Loading...
Res 19-013RESOLUTION NO. 19-013 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF POWAY, CALIFORNIA, APPROVING (I) A PURCHASE, SALE, AND DEVELOPMENT AGREEMENT WITH POWAY COMMONS, LLC, FOR CITY -OWNED PROPERTIES BEARING ASSESSOR'S PARCEL NUMBER 317-472-18, 317-472-23, 317-472-24, 317- 472-25 AND THE NORTHERLY APPROXIMATELY .64 ACRES OF 317-101-06, AND (II) A PROPERTY EXCHANGE IMPLEMENTATION AGREEMENT BETWEEN THE CITY AND THE CITY OF POWAY HOUSING AUTHORITY WHEREAS, the City of Poway (the "City") is a municipal corporation and general law city duly organized and existing under and pursuant to the Constitution and laws of the State of California; WHEREAS, the City is authorized to "control, dispose of, and convey" public property for "the benefit of the city" (Gov. Code Section 37351); WHEREAS, the City is also authorized to sell property to create an economic opportunity (Gov. Code Section 52201); WHEREAS, the City is the fee title owner of five (5) parcels comprising approximately 4.56 acres of real property generally located at 13100 Poway Road and bearing Assessor's Parcel Number 317-101-06, 317-472-18, 317-472-23, 317-472-24 and 317-472-25 (the "City Parcels"), in the City of Poway, County of San Diego, State of California; WHEREAS, the City of Poway Housing Authority (the "Authority") is the fee title owner of two (2) parcels comprising approximately 2.91 acres of real property generally located at 13021 and 13031 Poway Road and bearing Assessor's Parcel Numbers 317-472-01 and 317-472-06 (the "Housing Authority Parcels"), in the City of Poway, County of San Diego, State of California; WHEREAS, the Housing Authority Parcels and the City Parcels (with the exception of the southernmost approximately .9 acres of Assessor's Parcel Number 317-101-06 of the City Parcels, referred to hereinafter as the "Affordable Parcel") are collectively referred to as the "Properties", and are identified on the Vicinity Map, which is included as Exhibit A to this Resolution; WHEREAS, the City retained Integra Realty Resources to prepare an MAI appraisal of the Properties, which identified the current full fair market value of the Properties as $5,579,091; WHEREAS, the Properties are currently zoned for the Poway Road Specific Plan ("Specific Plan"), are designated as Town Center, and allow general commercial and multi -family residential uses; Resolution No. 19-013 Page 2 WHEREAS, City staff have negotiated a Purchase, Sale, and Development Agreement (the "PSDA") with Poway Commons, LLC, a California limited liability company ("Developer"), pursuant to which the City would sell the Properties to Developer for a purchase price of $6,400,500, and the Developer would be required to develop the Properties with a commercial retail development and residential uses permitted by, and in compliance with, the development standards set forth in, the Specific Plan (the "Project"), all as more particularly described in the PSDA; WHEREAS, pursuant to the PSDA, the Developer would be required to perform certain improvements to the Properties, including demolishing existing buildings, removing hazardous materials, and remediating contaminated soil, and would also be required to maintain the completed development in a good condition and repair; WHEREAS, pursuant to the PSDA, City would make a loan to the Developer to assist in the purchase of the Properties and the Developer would be required to execute a note evidencing its obligation to repay the City loan, with interest compounded monthly, with such repayment due in full on the fourth anniversary of the note; WHEREAS, concurrently with the negotiation of the PSDA, Housing Authority staff have negotiated an Affordable Housing and Property Disposition Agreement with the Developer (the "AHPDA"), pursuant to which the Housing Authority would sell to the Developer the Affordable Parcel, for the Developer's subsequent sale (after establishing the Affordable Parcel as a separate legal parcel and performing certain grading and infrastructure work on the Affordable Parcel) to a limited partnership established by Chelsea Investment Company, an experienced affordable housing developer, or similarly qualified affordable housing developer acceptable to the Authority (an "Affordable Developer"), and for the Affordable Developer's development and operation on the Affordable Parcel of a 44 unit senior affordable housing development; WHEREAS, City and Authority staff have determined that the proposed AHPDA and PSDA reflect the optimal development potential of the Affordable Parcel and Properties; WHEREAS, to facilitate the implementation of the AHPDA and PSDA, City and Authority staff have prepared a Property Exchange Implementation Agreement, pursuant to which, concurrently with the close of escrow under the AHPDA and PSDA, (i) the City would transfer the Affordable Parcel to Authority, (ii) Authority would transfer the Housing Authority Parcels to the City, and (iii) the City would deposit into the Authority's Low and Moderate Income Housing Asset Fund the sum of One Million Four Hundred Ninety -Three Thousand Three Hundred Five Dollars ($1,493,305), which is the difference between the value of the Affordable Parcel and the Housing Authority Parcels; WHEREAS, Government Code 52201 requires that the City prepare a Summary Report to consider the financial terms of the transaction, as set forth in the PSDA, that the City Council conduct a noticed public hearing with respect to the PSDA, and that the approval of the PSDA be accompanied by certain findings and determinations as set forth herein; WHEREAS, a Summary Report for the PSDA has been prepared and the public hearing has been conducted in accordance with applicable requirements of law; Resolution No. 19-013 Page 3 WHEREAS, the City Council has considered all the information and evidence set forth in the Summary Report presented by City staff and presented by persons wishing to appear and be heard concerning the impact of the PSDA on the City; WHEREAS, the PSDA is of benefit to and in the best interests of the City of Poway; and WHEREAS, City staff recommend that the City Council find and determine that the environmental impacts of the contemplated development of the parcels subject to the AHPDA and PSDA (the "Retail/Residential and Affordable Projects") are fully analyzed in and covered by the previously certified Poway Road Specific Plan ("PRSP") environmental impact report ("EIR"; SCH# 2017031035), and that the City, by approving this resolution, is not committing itself nor the City Council to approve any of the entitlements required for the Retail/Residential and Affordable Projects, and instead both the City and Housing Authority retain the discretion to deny the Retail/Residential and Affordable Projects, which will still be subject to further environmental review pursuant to the California Environmental Quality Act ("CEQA") to ensure the PRSP EIR covers all of the Retail/Residential and Affordable Projects' impacts, and no conditions set forth in Public Resources Code section 21166 and CEQA Guidelines section 15162 exist. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Poway as follows: Section 1: The foregoing recitals are true and correct and are a substantive part of this Resolution. Section 2: The environmental impacts of the Retail/Residential and Affordable Projects are fully analyzed in and covered by the previously certified PRSP EIR (SCH# 2017031035), and no conditions set forth in Public Resources Code section 21166 and CEQA Guidelines section 15162 exist. Section 3: Notwithstanding the foregoing, the City Council retains all discretion to deny any entitlements required for the Retail/Residential and Affordable Projects. The Retail/Residential and Affordable Projects will be subject to further environmental review pursuant to CEQA ensure the PRSP EIR covers all of the Retail/Residential and Affordable Projects' impacts, and no conditions set forth in Public Resources Code section 21166 and CEQA Guidelines section 15162 exist. Section 4: The City Council hereby finds and determines that the purchase price for the Properties pursuant to the PSDA is not less than the fair market value of the Properties at their highest and best use. Section 5: The City Council hereby finds and determines that the PSDA will assist in the creation of economic opportunity in that the PSDA will create at least one full-time equivalent, permanent job after full capacity and implementation. Section 6: The City Council approves the PSDA and the sale of the Properties to the Developer for the purchase price of $6,420,500, which purchase price is not less than the full fair market value of the Properties, pursuant to the PSDA, a copy of which is attached hereto as Exhibit B. Section 7: The City Council approves the Property Exchange Implementation Agreement, a copy of which is attached hereto as Exhibit C. Resolution No. 19-013 Page 4 Section 8: The City Council authorizes and directs the City Manager and City Attorney to make final modifications to the PSDA and Property Exchange Implementation Agreement that are consistent with the substantive terms of the PSDA and Property Exchange Implementation Agreement approved hereby, and to thereafter sign the PSDA and Property Exchange Implementation Agreement on behalf of the City. Section 9: The City Council authorizes and directs the City Manager to (i) sign such other and further documents, including but not limited to escrow instructions, that require the City's signature, and (ii) take such other and further actions, as may be necessary and proper to carry out the terms of the PSDA and Property Exchange Implementation Agreement. Section 10: This Resolution shall take effect from and after its adoption. PASSED, ADOPTED AND APPROVED by the City Council of the City of Poway, California, at a regular meeting this 19th day of March 2019. Steve Vaus, Mayor ATTEST: Faviola Medina, CMC, City Clerk STATE OF CALIFORNIA ) SS COUNTY OF SAN DIEGO ) I, Faviola Medina, City Clerk of the City of Poway, California, do hereby certify under penalty of perjury that the foregoing Resolution No. 19-013 was duly adopted by the City Council at a meeting of said City Council held on the 19th day of March 2019, and that it was so adopted by the following vote: AYES: LEONARD, FRANK, GROSCH, VAUS NOES: NONE ABSENT: NONE DISQUALIFIED: MULLIN Faviola Medina, CMC, City Clerk City of Poway Resolution No. 19-013 Page 5 Exhibit A Vicinity Map Resolution No. 19-013 Exhibit B PURCHASE, SALE, AND DEVELOPMENT AGREEMENT by and between CITY OF POWAY a California municipal corporation, and POWAY COMMONS, LLC a Delaware limited liability company 882/012782-0020 g9O2 ni t06/01/20 March 19, 2019 Item #3.1 Resolution No. 19-013 PURCHASE, SALE, AND DEVELOPMENT AGREEMENT THIS PURCHASE, SALE, AND DEVELOPMENT AGREEMENT (this "Agreement") is dated as of , 2019 (the "Effective Date"), and is entered into by and between POWAY COMMONS, LLC, a Delaware limited liability company ("Developer"), and the CITY OF POWAY, a California municipal corporation (the "City"). City and Developer enter into this Agreement with reference to the following recited facts (each a "Recital"): RECITALS A. City owns fee title to that certain real property located in the City of Poway, County of San Diego, State of California, commonly known as APN Nos. 317-472-18, 23, 24 & 25 (collectively, the "City -Owned Property"). B. City also owns fee title to that certain real property located in the City of Poway, County of San Diego, State of California, commonly known as APN No. 317-101- 06 (the "City -Owned Mixed Property"). C. Concurrently with the execution of this Agreement, City is entering into an agreement with the City of Poway Housing Authority ("Authority") to acquire that certain real property located in the City of Poway, County of San Diego, State of California, commonly known as APN No. 317-472-01 & 06 (the "Authority -Owned Property"). D. Developer has entered into purchase and sale agreements (the "Private Parcels Purchase Agreements") with the owners of the real property located at 13029, 13117, and 13126 Poway Road, in the City of Poway, County of San Diego, State of California (collectively, the "Private Parcels"). E. City and Developer desire by this Agreement for (i) Developer to close escrow under the Private Parcels Purchase Agreements and acquire fee title to the Private Parcels; (ii) City to sell to Developer fee title to the "City Parcels," which is comprised of (a) the City -Owned Property, (b) the City -Owned Mixed Property, other than approximately nine tenths (.9) acres located in the southernmost portion of the parcel, and (c) the Authority -Owned Property; (iii) Developer to (a) process through City one or more subdivision maps to create (1) from the southernmost nine tenths (.9) acre portion of the City -Owned Mixed Property, the "Affordable Housing Parcel", (2) a subdivision containing approximately four (4) parcels (collectively, the "Residential Parcels") for development thereon of a residential condominium development containing ninety-eight (98) condominium units and common area improvements and amenities to serve such units (collectively, the "Residential Development"), and (3) approximately two (2) parcels (the "Retail Parcels"); and (b)(1) construct on the Residential Parcels the Residential Development, and (2) diligently pursue and attempt to plan and develop a comprehensive retail development that includes the Retail Parcels and certain other real property within the City of Poway, County of San Diego, State of California, encompassing a minimum of twenty-five thousand square feet (25,000 sf) (a "Comprehensive Retail Development"). 882/012782-0020 98ioi 06/01 /20 March 19, 2019 Item #3.1 Resolution No. 19-013 F. The City -Owned Property, the City -Owned Mixed Property, and the Authority -Owned Property are legally described in Attachment No. 1, which is attached hereto and incorporated herein by this reference. G. The City -Owned Property, the City -Owned Mixed Property, the Authority - Owned Property, and the Private Parcels are depicted on the area site map attached hereto and incorporated herein as Attachment No. 2A (the "Area Site Map"). H. The proposed subdivisions and locations of the Affordable Housing Parcel, Residential Parcels, and Retail Parcels are depicted on the proposed subdivision map attached hereto and incorporated herein as Attachment No. 2B (the "Proposed Subdivision Map"). City's disposition of the City Parcels to Developer, and Developer's subsequent construction and completion of the "Project" (as that term is defined in Article II below), pursuant to the terms of this Agreement, are in the vital and best interest of the City of Poway and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of applicable federal, state, and local laws and requirements. NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION AND THE PROMISES AND COVENANTS OF THE PARTIES SET FORTH IN THIS AGREEMENT, CITY AND DEVELOPER AGREE, AS FOLLOWS: ARTICLE I RECITALS AND IDENTITIES OF PARTIES Section 1.1 Incorporation of Recitals. The Recitals of fact set forth above are true and correct and are incorporated into this Agreement in their entirety by this reference. Section 1.2 Parties to the Agreement. The Parties to this Agreement are City and Developer. Section 1.3 Restrictions on Change in Management or Control of Developer and Assignment or Transfer. (a) Developer acknowledges that the qualifications and identity of Developer are of particular importance to City. Developer further recognizes and acknowledges that City has relied and is relying on the specific qualifications and identity of Developer in entering into this Agreement with Developer and, as a consequence, Transfers are permitted only as expressly provided in this Agreement. (b) Developer shall promptly notify City in writing of any and all changes whatsoever in the identity of the business entities or individuals either comprising or in control of Developer, as well as any and all changes in the interest or the degree of control of Developer by any such person, of which information Developer or any of its partners, members or officers are notified or may otherwise have knowledge or information. If there 882/012782-0020 0f36/01/20 -2- March 19, 2019 Item #3.1 Resolution No. 19-013 is any Transfer, whether voluntary or involuntary, in membership, ownership, management or control of Developer (other than such changes occasioned by the death or incapacity of any individual) other than a Permitted Transfer or a Transfer that has been approved in writing by City prior to the time of such Transfer, then prior to the Project Completion Date City may exercise any remedy available to City under the terms of this Agreement; provided, however, that (i) City shall first notify Developer in writing of its intention to terminate this Agreement or to exercise any other remedy, and (ii) Developer shall have twenty (20) calendar days following its receipt of such written notice to commence and, thereafter, diligently and continuously proceed to cure the default of Developer and submit evidence of the initiation and satisfactory completion of such cure to City, in a form and substance reasonably satisfactory to City. (c) Except for Permitted Transfers or as otherwise set forth in this Section 1.3, and notwithstanding any provision to the contrary in this Agreement, prior to the Project Completion Date, Developer shall not sell, assign, convey, create any trust estate with respect to or otherwise Transfer any of its interests in this Agreement, the Property, and/or the Project, without the prior written approval of the City Manager, which approval shall not be unreasonably conditioned, delayed, or denied; this restriction shall not apply on and after the Project Completion Date. Developer recognizes that the qualifications and identity of Developer are of particular concern to City and that a sale, assignment, conveyance with respect to or other Transfer of any of Developer's interests in this Agreement, the Property, and/or the Project is for all practical purposes a transfer or disposition of the responsibilities of Developer with respect to this Agreement, the Property, and/or the Project and, therefore, are only allowed in accordance with the provisions of this Section 1.3. Except as expressly permitted in this Agreement, Developer represents and agrees that it has not made and will not create or suffer to be made or created, any Transfer, either voluntarily, involuntarily or by operation of law, without the prior written approval of City, until after the Project Completion Date. Any Transfer made in contravention of this Section 1.3 shall be voidable at the election of City and, if voided, shall be deemed to be an Event of Default by Developer, whether or not Developer knew of or participated in such Transfer. (d) Subject to the terms of paragraph (c) above in this Section 1.3, Developer is not required to give City advance notice of, nor shall City have the right to approve, a Permitted Transfer. Additionally, City may, in its reasonable discretion, approve in writing any other Transfer (meaning, a Transfer that is not a Permitted Transfer) requested by Developer, provided the proposed transferee can satisfactorily demonstrate successful experience in the development of a project of the same type as the Project, acquires fee title to the Property, and expressly assumes in writing all of the obligations of the Developer under this Agreement. Further, Developer may allow an investor to acquire an ownership interest in Developer, and/or Developer may assign (a) all of its rights and obligations under this Agreement, (b) all of its rights and obligations with respect to the Retail Parcels and the Comprehensive Retail Development, or (c) all of its rights and obligations with respect to (I) obtaining all of the Entitlements, (II) the Residential Parcels, (III) the Residential Development, and (IV) performance of all demolition and grading activities required by this Agreement to be performed on or with respect to the Property, to an entity in which Developer or an Affiliate thereof and an 882/012782-0020 ,igp 8foi g6/01 /20 -3- March 19, 2019 Item #3.1 Resolution No. 19-013 investor are the sole owners, provided (i) City approves the investor, and (ii) Poway Commons, LLC, a Delaware limited liability company, or an Affiliate thereof, retains control of the day-to-day operations of the development of the Project. City shall be required to approve any proposed investor that provides evidence to City that it (1) is a Person that has been legally established and is operating in good standing in the jurisdiction in which it has been established, (2) has experience in developing and/or financing development projects similar in nature to the Project, and (3) has the financial capability to undertake the obligations proposed to be undertaken pursuant to the contractual arrangement between said investor and Developer. All instruments and other legal documents proposed to effect any Transfer shall be submitted to City for review, prior to the Transfer, and the written approval or disapproval of City shall be provided to Developer, within fifteen (15) calendar days of City's receipt of Developer's request. (e) The provisions of this Section 1.3 shall terminate and be of no further force and effect upon issuance of a Release of Construction Covenants for the Project. (f) Upon an approved or Permitted Transfer of the Property by Developer prior to the Project Completion Date or any Transfer thereafter, Developer shall be deemed released from any obligations under this Agreement except for any indemnification obligations with respect to Claims based on actions and/or inactions occurring prior to such Permitted Transfer. ARTICLE II DEFINITIONS Section 2.1 Defined Terms. In addition to the usage of certain words, terms or phrases that are defined in the initial paragraph or Recitals of this Agreement, the following words, terms and phrases are used in this Agreement, including in ARTICLE I above, unless the particular context of usage of a word, term or phrase requires another interpretation: (a) "13033 Poway Road Parcel" means and refers to the portion of the City Parcels located at 13033 Poway Road. (b) "Additional Deposit" means and refers to the amount of One Hundred Twenty -Five Thousand Dollars ($125,000), in cash or other immediately available funds. (c) "Affiliate" means and refers to any Person, directly or indirectly, Controlling or Controlled by or under common Control with Developer, whether by direct or indirect ownership of equity interests, by contract or otherwise. (d) "Affordable Housing Parcel" means and refers to the southernmost portion of the City -Owned Mixed Property, which is designated as the "Affordable Housing Parcel" on the Proposed Subdivision Map. The Affordable Housing Parcel comprises approximately nine tenths (.9) acres. Notwithstanding anything in this Agreement to the contrary, the Affordable Housing Parcel shall not comprise a portion of the City Parcels 882/012782-0020 qy98foig6io-ii2o -4- March 19, 2019 Item #3.1 Resolution No. 19-013 or the Property, and the disposition and development of the Affordable Housing Parcel shall be addressed in the AHPDA. (e) "AHPDA" means and refers to that certain Affordable Housing and Property Disposition Agreement entered into between the Authority and Developer on or about the Effective Date, pursuant to which the Authority has agreed to sell to Developer the Affordable Housing Parcel, and Developer has agreed to perform certain grading and infrastructure work, and to thereafter transfer the Affordable Housing Parcel and assign its rights and obligations under the AHPDA to a limited partnership in which any of (i) Chelsea Investment Corporation, a California nonprofit public benefit corporation ("Chelsea"), (ii) an affiliate of Chelsea, or (iii) another entity experienced in the development and operation of affordable housing and acceptable to the Authority in the Authority's reasonable discretion, is a general partner, for said limited partnership to develop and operate on the Affordable Housing Parcel a forty-four (44) unit affordable senior rental apartment development. (f) "Authority" means and refers to the City of Poway Housing Authority. (g) "CEQA" means and refers to the California Environmental Quality Act, Public Resources Code Section 21000, et seq. (h) "CEQA Claims" means and refers to any appeals or protests (including litigation) taken or filed with respect to City's findings, determinations, and/or certifications pursuant to CEQA in connection with City's approval of this Agreement and in connection with City's approval, conditional approval, or denial, of the Entitlements. (i) "City" means and refers to the City of Poway, California. (j) "City and City Personnel" means and refers, collectively, to City, its elected and appointed officials, commissions, employees, agents, representatives, and attorneys. (k) "City Deed of Trust" means and refers to a deed of trust substantially in the form of Attachment No. 8 to this Agreement, securing Developer's obligation to repay the City Note. The City Deed of Trust shall be recorded against the Retail Parcels. (I) "City Grant Deed" means and refers to a grant deed substantially in the form of Attachment No. 5 to this Agreement, conveying all of City's interest in the Property to Developer. (m) "City Loan " means and refers to the loan to be made by City at the Close of Escrow, in the amount of One Million Seven Hundred Thousand Dollars ($1,700,000). The City Loan shall be provided to Developer in the form of a credit towards Developer's payment of the Purchase Price. 882/012782-0020 igylig6ioii2o -5- March 19, 2019 Item #3.1 Resolution No. 19-013 (n) "City Manager" means and refers to the person duly appointed to the position of City Manager of the City or his or her designee or successor in function. (o) "City Note" means and refers to a note substantially in the form of Attachment No. 7 to this Agreement, evidencing the City Loan. (p) "City -Owned Mixed Property" shall have the meaning ascribed thereto in Recital B. The City -Owned Mixed Property comprises approximately one and fifty-four hundredths (1.54) acres. The City -Owned Mixed Property is legally described in Attachment No. 1, which is incorporated herein by this reference. (q) "City Parcels" shall have the meaning ascribed thereto in Recital A. The City Parcels comprise approximately three and two hundredths (3.02) acres. The City Parcels are legally described in Attachment No. 1, which is attached hereto and incorporated herein by this reference. Notwithstanding anything to the contrary in this Agreement, the City Parcels shall not include the Affordable Housing Parcel. The Affordable Housing Parcel shall be conveyed to Developer pursuant to the AHPDA. (r) "City's Right of First Refusal" means and refers to City's right to acquire all or any portion of the Property pursuant to the terms set forth in Section 10.6 below. (s) "City's Title Notice Response" means and refers to the written response of City to Developer's Title Notice, in which City elects to (i) cause the removal from the Preliminary Report of some or all of the disapproved exceptions, or (ii) not to cause the removal from the Preliminary Title Report of any disapproved exceptions. (t) "City's Title Policy" means and refers to a standard ALTA lenders' policy of title insurance issued by the Title Company, with coverage in the full amount of the City Loan and insuring the priority of the City Loan. (u) "Claims" means any and all claims, losses, costs, damages, expenses, liabilities, liens, actions, causes of action (whether in tort or contract, at law or in equity, or otherwise), charges, awards, assessments, fines, and penalties of any kind (including consultant and expert expenses, court costs, and reasonable attorney's fees of counsel retained by the City Parties, expert fees, costs of staff time, and investigation costs, of whatever kind or nature), and judgments, including, but not limited to, Claims for: (1) injury to any person (including death at any time resulting from that injury); (2) loss of, injury or damage to, or destruction of, property (including all loss of use resulting from that loss, injury, damage, or destruction) regardless of where located, including the property of the City Parties; (3) any workers' compensation or prevailing wage determination; and (4) all economic losses and consequential or resulting damage of any kind. (v) "Close of Escrow" means and refers to the recording of the City Grant Deed in the Official Records of the Recorder of the County of San Diego, California, and completion of each of the actions set forth in ARTICLE IV by the Escrow Holder for 882/012782-0020 498i0i 506/01 /20 -6- March 19, 2019 Item #3.1 Resolution No. 19-013 City to sell the City Parcels to Developer and Developer to purchase the City Parcels from City. (w) "Comprehensive Retail Development" shall have the meaning ascribed thereto in Recital C. (x) "Control" means and refers to possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether by ownership of equity interests, by contract or otherwise. (y) having Control. Section 5.12. "Controlling" and "Controlled" mean and refer to exercising or (z) "Developer CC&Rs" shall have the meaning ascribed thereto in (aa) "Developer's Second Title Notice" means and refers to a written notice from Developer to City indicating Developer's continued disapproval of specific matters shown in Schedule B of the Preliminary Title Report or Supplement Report, as exceptions to coverage under the proposed Developer's Title Policy for the City Parcels, describing in suitable detail the actions that Developer reasonably believes are necessary to obtain Developer's approval of the state of the title to the City Parcels. (bb) "Developer's Title Notice" means and refers to a written notice from Developer to City indicating Developer's acceptance of the state of the title to the City Parcels, as described in the Preliminary Report or Supplemental Report, or Developer's disapproval of specific matters shown in Schedule B of the Preliminary Report or Supplemental Report, as exceptions to coverage under the proposed Developer's Title Policy for the City Parcels, describing in suitable detail the actions that Developer reasonably believes are necessary to obtain Developer's approval of the state of the title to the City Parcels. (cc) "Developer's Title Notice Waiver" means and refers to a written notice from Developer to City waiving Developer's previous disapproval in the Developer's Title Notice of specific matters shown in Schedule B of the Preliminary Report or in the Supplemental Report as exceptions to coverage under the proposed Developer's Title Policy for the City Parcels. (dd) "Developer's Title Policy" means and refers to a standard ALTA owners' policy of title insurance issued by the Title Company, with coverage in the full amount of the Purchase Price and insuring fee title to the City Parcels vested in the Developer; provided, however, that Developer shall have the right, at Developer's sole cost, to elect to obtain title endorsements and/or an extended coverage ALTA owner's policy, as further set forth in Section 4.8 below. (ee) "Development Agreement" means and refers to a Development Agreement entered into or to be entered into between City and Developer pursuant to Government Code section 65864 et seq., in a form acceptable to City and Developer. 882/012782-0020 Ri)98inig6/o1/20 -7- March 19, 2019 Item #3.1 Resolution No. 19-013 (ff) "Due Diligence Investigations" means and refers to Developer's due diligence investigations of the City Parcels to determine the condition of the City Parcels and the suitability of the City Parcels for development of the Project, and such other matters as Developer may deem relevant. (gg) "Due Diligence Investigation Conclusion Notice" means and refers to a written notice of Developer delivered to both City and the Escrow Holder, prior to the end of the Due Diligence Period, indicating Developer's acceptance of the City Parcels or indicating Developer's rejection of the City Parcels and refusal to accept a conveyance of fee title to the City Parcels, describing in reasonable detail the actions or circumstances that Developer reasonably believes are necessary to allow Developer to accept the City Parcels; provided, however, that Developer may, in its sole and absolute discretion, determine not to accept the City Parcels without identifying any such actions or circumstances. (hh) "Due Diligence Period" means and refers to the time period of one hundred twenty (120) continuous days commencing on the day immediately following the Escrow Opening Date. (ii) "Earnest Money Deposit" means and refers, collectively, to the Initial Deposit and the Additional Deposit. (jj) "Entitlement Approval Date" means the date that all of the Entitlements have been approved by each required Governmental Agency and all appeal and protest periods have expired with no appeals or protests (including litigation) taken or filed ("Entitlement Claims"), or, if any are so taken or filed, then upon the resolution of the Entitlement Claims upon terms acceptable to each of City and Developer, in their respective sole and absolute discretion. (kk) "Entitlements" means and refers to all of the discretionary entitlements, permits and approvals required for the development of the Project, including, without limitation, the Development Agreement, a Development Review and Tentative Map. (II) "Environmental Claims" means and refers to any and all claims, demands, damages, losses, liabilities, obligations, penalties, fines, actions, causes of action, judgments, suits, proceedings, costs, disbursements and expenses, including, without limitation, attorney fees, disbursements and costs of attorneys, environmental consultants and other experts, and all foreseeable and unforeseeable damages or costs of any kind or of any nature whatsoever directly or indirectly relating to or arising from any Environmental Matters existing or occurring during or arising from Developer's Due Diligence Investigations, Developer's ownership or occupancy of the Property or Developer's construction of the Project. (mm) "Environmental Laws" means and refers to all federal, state, local, or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees, or requirements of any governmental authority regulating, relating to, or imposing liability or 882/012782-0020 1 1 07,.006/01 /20 -8- March 19, 2019 Item #3.1 Resolution No. 19-013 standards of conduct concerning any Hazardous Substance, or pertaining to occupational health or industrial hygiene (to the extent that the occupational health or industrial hygiene laws, ordinances, or regulations relate to any Hazardous Substance on, under, or about the Property), occupational or environmental conditions on, under, or about the Property, as now or may, at any later time, be in effect, including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA") [42 U.S.C. Section 9601 et seq.]; the Resource Conservation and Recovery Act of 1976 ("RCRA") [42 U.S.C. Section 6901 et seq.]; the Clean Water Act, also known as the Federal Water Pollution Control Act ('FWPCA") [33 U.S.C. Section 1251 et seq.]; the Toxic Substances Control Act (TSCA") [15 U.S.C. Section 2601 et seq.]; the Hazardous Materials Transportation Act (HMTA") [49 U.S.C. Section 1801 et seq.]; the Insecticide, Fungicide, Rodenticide Act [7 U.S.C. Section 6901 et seq.] the Clean Air Act [42 U.S.C. Section 7401 et seq.]; the Safe Drinking Water Act [42 U.S.C. Section 300f et seq.]; the Solid Waste Disposal Act [42 U.S.C. Section 6901 et seq.]; the Surface Mining Control and Reclamation Act [30 U.S.C. Section 101 et seq.]; the Emergency Planning and Community Right to Know Act [42 U.S.C. Section 11001 et seq.]; the Occupational Safety and Health Act [29 U.S.C. Section 655 and 657]; the California Underground Storage of Hazardous Substances Act [Health and Safety Code Section 25280 et seq.]; the California Hazardous Substances Account Act [Health and Safety Code Section 25300 et seq.]; the California Safe Drinking Water and Toxic Enforcement Act [Health and Safety Code Section 24249.5 et seq.] the Porter -Cologne Water Quality Act [Water Code Section 13000 et seq.] together with any amendments of, or regulations promulgated under the statutes cited above and any other federal, state, or local law, statute, ordinance, or regulation, now in effect or later enacted, that pertains to occupational health or industrial hygiene, and only to the extent the occupational health or industrial hygiene laws, ordinances, or regulations relating to any Hazardous Substance on, under, or about the Property, or the regulation or protection of the environment, including ambient air, soil, soil vapor, groundwater, surface water, or land use. (nn) "Environmental Matters" means and refers to any of the following: (1) The presence of any Hazardous Substances on, in, under, from or affecting all or any portion of the Property or the Project; (2) The storage, holding, handling, release, threatened release, discharge, generation, leak, abatement, removal or transportation of any Hazardous Substances on, in, under, from or affecting the Property or the Project; (3) The violation of any law, rule, regulation, judgment, order, permit, license, agreement, covenant, restriction, requirement or the like by Developer, its agents or contractors, relating to or governing in any way Hazardous Substances on, in, under, from or affecting the Property or the Project; (4) The failure of Developer, its agents or contractors, to properly complete, obtain, submit and/or file any and all notices, permits, licenses, authorizations, 882/012782-0020 i91:Ifig6/o1/20 -9- March 19, 2019 Item #3.1 Resolution No. 19-013 covenants and the like in connection with Developer's activities on the Property or regarding the Project; (5) The implementation and enforcement by Developer, its agents or contractors of any monitoring, notification or other precautionary measures that may, at any time, become necessary to protect against the release, potential release or discharge of any Hazardous Substances on, in, under, from or affecting the Property or the Project; (6) The failure of Developer, its agents or contractors, in compliance with all applicable Environmental Laws, to lawfully remove, contain, transport or dispose of any Hazardous Substances existing, stored or generated on, in, under or from the Property or the Project; (7) Any investigation, inquiry, order, hearing, action or other proceeding by or before any Governmental Agency in connection with any Hazardous Substances on, in, under, from or affecting the Property or the Project or the violation of any Environmental Law relating to the Property. or the Project (oo) "Escrow" means and refers to an escrow, as defined in Civil Code Section 1057, that is conducted by the Escrow Holder with respect to the Property, pursuant to this Agreement. (pp) "Escrow Closing Date" means and refers to the earliest of: (1) a date two (2) business days after the date that Developer is issued the first grading permit for the Project, or fifteen (15) months after the Effective Date; provided, however, if any of such dates is not a business day (meaning a day that documents can be placed of record in San Diego County), then the applicable date shall be extended to the second such business day thereafter. Developer shall have the right, but not the obligation and upon five (5) days advance written notice to City, to extend the Escrow Closing Date for two successive periods of one (1) month each. (qq) "Escrow Holder" means and refers to First American Title Insurance Company, with its offices at 4380 La Jolla Village Drive, Suite 200, San Diego, CA 92122. (rr) "Escrow Opening Date" means and refers to the first date on which a fully executed copy of this Agreement, the Initial Earnest Money Deposit is deposited with the Escrow Holder. (ss) "Event of Default" shall have the meaning ascribed to the term in Section 9.2. (tt) "FIRPTA Affidavit" means and refers to an affidavit complying with Section 1445 of the United States Internal Revenue Code ("IRC 1445") evidencing that neither Developer nor Escrow Holder is required to withhold City's closing funds pursuant to IRC 1445. 882/012782-0020 g98foig6/01/20 -10- March 19, 2019 Item #3.1 Resolution No. 19-013 (uu) "First Phase" shall have the meaning ascribed to the term in Section 4.2(b)(17). (vv) "Form 593" means and refers to a California Franchise Tax Board Form 593-W evidencing that neither Developer nor Escrow Holder is required to withhold City's closing funds pursuant to California Revenue and Taxation Code Section 18662e). (ww) "Governmental Agency" means and refers to any and all courts, boards, agencies, commissions, offices, or authorities of any nature whatsoever for any governmental unit (federal, state, county, district, municipal, city, or otherwise), including the City, pursuant to its general police power jurisdiction, whether now or later in existence with jurisdiction over the Property or the construction of any portion of the Project. (xx) "Governmental Requirements" means and refers to all codes, statutes, ordinances, laws, permits, orders, and any rules and regulations promulgated thereunder of any Governmental Agency. (yy) "Hazardous Substance" means and refers to, without limitation, substances defined as a "Hazardous Substance," "hazardous material," "toxic substance," "solid waste," or "pollutant or contaminate" in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sections 9601, et seq.; the Toxic Substances Control Act ("TSCA") [15 U.S.C. Sections 2601, et seq.]; the Hazardous Materials Transportation Act, 49 U.S.C. Sections 1801, et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901, et seq.; those substances listed in the United States Department of Transportation (DOT) Table [ 49 CFR 172.101], or by the EPA, or any successor authority, as a Hazardous Substance [ 40 CFR Part 302]; and those substances defined as "hazardous waste" in Section 25117 of the California Health and Safety Code or, as a "Hazardous Substance" in Section 25316 of the California Health and Safety Code; other substances, materials, and wastes that are, or become, regulated or classified as hazardous or toxic under federal, state, or local laws or regulations and in the regulations adopted pursuant to said laws, and shall also include manure, asbestos, polychlorinated biphenyl, flammable explosives, radioactive material, petroleum products, and substances designated as a hazardous substance pursuant to 33 U.S.C. Section 1321 or listed pursuant to 33 U.S.C. Section 1317. (zz) "Initial Deposit" means and refers to the amount of One Hundred Twenty -Five Thousand Dollars ($125,000), in cash or other immediately available funds. (aaa) "Institutional Lender" means any of the following institutions having assets or deposits in the aggregate of not less than One Hundred Million Dollars ($100,000,000): a California chartered bank; a bank created and operated under and pursuant to the laws of the United States of America; an "incorporated admitted insurer" (as that term is used in Section 1100.1 of the California Insurance Code); a "foreign (other state) bank" (as that term is defined in Section 1700(1) of the California Financial Code); a federal savings and loan association (Cal. Fin. Code Section 8600); a commercial finance lender (within the meaning of Sections 2600 et seq. of the California Financial 882/012782-0020 14 O2 T 1 06/01 /20 -11- March 19, 2019 Item #3.1 Resolution No. 19-013 Code); a "foreign (other nation) bank" provided it is licensed to maintain an office in California, is licensed or otherwise authorized by another state to maintain an agency or branch office in that state, or maintains a federal agency or federal branch in any state (Section 1716 of the California Financial Code); a bank holding company or a subsidiary of a bank holding company which is not a bank (Section 3707 of the California Financial Code); a trust company, savings and loan association, insurance company, investment banker; college or university; pension or retirement fund or system, either governmental or private, or any pension or retirement fund or system of which any of the foregoing shall be trustee, provided the same be organized under the laws of the United States or of any state thereof; and a Real Estate Investment Trust, as defined in Section 856 of the Internal Revenue Code of 1986, as amended, provided such trust is listed on either the American Stock Exchange or the New York Stock Exchange. (bbb) "Lender" means and refers to any person or entity making a Loan to Developer. (ccc) "Loan" means and refers, individually, to any loan that Developer shall obtain, the proceeds of which are to be used and applied solely to pay the reasonable costs of obtaining such loan and: (1) the Purchase Price and the other costs of acquiring the Property through the Escrow and/or (2) the costs of developing the Project. (ddd) "Memorandum of Agreement" means and refers to the memorandum in substantially the form of Attachment No. 6 to this Agreement to be recorded against the Property at the Close of Escrow to provide constructive record notice of the existence and application of this Agreement to the Property. applicable. (eee) "Party" means and refers, individually, to either City or Developer, as (fff) "Parties" means and refers, collectively, to City and Developer. (ggg) "PCO Report" means and refers to a preliminary change of ownership report required under California Revenue and Taxation Code Section 480.3. (hhh) "Permitted Transfer" means and refers to any of the following types of Transfers by Developer, where the Person to which such Transfer is made, acquires the Property or a portion thereof (if such Permitted Transfer occurs after the Closing) and expressly assumes the obligations of Developer under this Agreement with respect to the portion of the Property so Transferred in a written instrument satisfactory to the City or acquires an equity interest in Developer: (1) Any Transfer of stock or equity of Developer that does not change management or operational control of the Property or the Project or is less than a 49% interest, as set forth in Section (1) of the definition of Transfer. (2) Any Transfer of any interest in Developer irrespective of the percentage of ownership (i) to any other owner of any interest in Developer; or (ii) to any 882/012782-0020 g902fi06/01 /20 -12- March 19, 2019 Item #3.1 Resolution No. 19-013 Affiliate, or (iii) to any other Person in which any holder of an interest (including any beneficial interest) in Developer as a manager, officer or partner or in which any of the aforementioned is a shareholder, member or partner (including a beneficial owner). (3) The pledge of any interest in the Property as security for a Loan. (4) Any foreclosure or deed in lieu of foreclose under the documents evidencing and securing repayment of a Loan. (5) Any Property Transfer to an entity in which Developer (or an Affiliate) has an ownership interest and which is formed with a third party to fund the development of the Project, and the exercise of any and all remedies under the applicable entity documents. (6) The recordation of replacement/permanent financing to replace a Loan. (7) The granting of easements and licenses in the ordinary course of the development and ownership of the Property and the Project. (8) A Transfer of the Retail Parcels to Sudberry Development Inc., a California corporation, or an Affiliate thereof. (iii) "Person" means and refers to any association, corporation, governmental entity or agency, individual, joint venture, joint-stock company, limited liability company, partnership, trust, unincorporated organization, or other entity of any kind. (jjj) "Poway Stoway Self -Storage Lease" means and refers to that certain month -to -month lease between City and Poway Stoway Self -Storage with respect to the 13033 Poway Road Parcel. (kkk) "Pre -Closing Liquidated Damages Amount" means and refers to the amount of Fifty Thousand Dollars ($50,000). (III) "Preliminary Report" means and refers to a preliminary report issued by the Title Company for the City Parcels, in contemplation of the issuance of the Developer's Title Policy, accompanied by copies of all documents listed in Schedule B of the report as exceptions to coverage under the proposed Developer's Title Policy. (mmm) "Private Parcels" shall have the meaning ascribed thereto in Recital C. The Private Parcels are legally described in Attachment No. 1, which is attached hereto and incorporated herein by this reference. (nnn) "Private Parcels Purchase Agreements" shall have the meaning ascribed thereto in Recital C. 882/012782-0020 g98foi 06/01 /20 -13- March 19, 2019 Item #3.1 Resolution No. 19-013 (000) "Project" means and refers to Developer's development of (i) the Residential Development on the Residential Property, (ii) the Comprehensive Retail Development on the Retail Parcels, and (iii) all required and/or associated on -site and off - site improvements, all as generally described in the Scope of Development, and all to be developed in accordance with plans and specifications approved by City and any conditions imposed by City in its approval of the Developer's development application(s) related to the Project. (ppp) "Project Budget" means and refers to the budget attached hereto and incorporated herein as Attachment No. 9. With respect to said attached budget, City acknowledges and agrees that Developer's cost estimates may change between the Effective Date and the Close of Escrow. Prior to the Close of Escrow, Developer shall submit its revised proposed budget to City for review and approval, which approval shall not be unreasonably withheld, conditioned or delayed. Upon City's approval thereof, said revised proposed budget shall become the Project Budget, and said budget shall be the budget upon which City bases its review pursuant to Section 4.2(b)(4). (qqq) "Project Completion Date" means and refers to the date on which City issues a Release of Construction Covenants for the Project. (rrr) "Property" means and refers to the City Parcels, the Private Parcels, and any other real property that Developer acquires during the term of this Agreement and proposes to develop as part of a Comprehensive Retail Development. (sss) "Property Transfer" means and refers to any "change in ownership," as defined in Revenue and Taxation Code Sections 60, et seq., of all or any portion of the Property. (ttt) "Purchase Price" means and refers to the amount of Six Million Four Hundred Twenty Thousand Five Hundred Dollars ($6,420,500). (uuu) "Record," "recorded," "recording" or "recordation" each mean and refer to recordation of the referenced document in the official records of the Recorder of the County of San Diego, California. (vvv) "Release of Construction Covenants" means and refers to the written certification of City that the Project is complete and in compliance with the terms and conditions of this Agreement, in substantially the form of Attachment No. 10 to this Agreement. (www) "Residential Development" shall have the meaning ascribed thereto in Recital D. Recital D. D. 882/012782-0020 ff98inig6/o1/20 (xxx) " Residential Property" shall have the meaning ascribed thereto in (yyy) "Retail Parcels" shall have the meaning ascribed thereto in Recital -14- March 19, 2019 Item #3.1 Resolution No. 19-013 (zzz) "Schedule of Performance" means and refers to the schedule for the performance of certain actions by City or Developer pursuant to the terms and conditions of this Agreement, attached to this Agreement as Attachment No. 4. (aaaa)"Scope of Development" means and refers to the detailed description of the primary elements of the Project attached to this Agreement as Attachment No. 3. (bbbb)Specific Plan" means and refers to the Poway Road Specific Plan, which was approved by the City Council of City on December 5, 2017. Developer's development and operation of the Project shall be in substantial conformance with the Specific Plan, as it may be amended from time to time in accordance with its provisions. In the event this Agreement is inconsistent with the Specific Plan, the terms of the Specific Plan shall prevail. (cccc) "Supplemental Report" means and refers to a supplement issued to the Preliminary Report by Title Company, accompanied by the additional documents referred to thereon. (dddd)"Tentative Map" means and refers to a tentative map subdividing the Property into multiple parcels, as necessary to accomplish the development of the Project. (eeee)'Title Company" means and refers to First American Title Insurance Company, with its offices at 4380 La Jolla Village Drive, Suite 200, San Diego, CA 92122. (ffff) "Transfer" means and refers to any of the following: (1) Any total or partial sale, assignment, conveyance, trust, power, or transfer in any other mode or form, by Developer of more than a 49% interest in Developer's interest in this Agreement, the Property, or the Project or a series of such sales, assignments and the like that, in the aggregate, result in a disposition of more than a 49% interest in Developer's interest in this Agreement, the Property, or the Project; or (2) Any total or partial sale, assignment, conveyance, or transfer in any other mode or form, of or with respect to any interest in Developer or a series of such sales, assignments and the like that, in the aggregate, result in a disposition of more than a 49% interest in any interest in Developer; or (3) Any merger, consolidation, sale or lease of all or substantially all of the assets of Developer or a series of such sales, assignments and the like that, in the aggregate, result in a disposition of more than a 49% interest of all or substantially all of the assets of Developer; or (4) Any Property Transfer; or (5) The recordation of any deed of trust, mortgage, lien or similar encumbrance against all or any portion of the Property or the Project other than a Loan. 882/012782-0020 g98ioig6to1/20 -15- March 19, 2019 Item #3.1 Resolution No. 19-013 (gggg)"Unavoidable Delay" means and refers to a delay in either Party performing any obligation under this Agreement, except payment of money, arising from or on account of any cause whatsoever beyond the Party's reasonable control, despite such Party's commercially reasonable efforts, including, without limitation, floods, earthquakes, or other extreme acts of nature, industry -wide strikes, unreasonable delays in obtaining governmental, utility company approvals or actions (provided, however, the Party claiming such delay makes a showing of reasonable and timely submission of all necessary materials and information, and that the response to such submittals was unusual, unreasonable and/or untimely), labor troubles or other union activities (but only to the extent such actions affect similar persons at that time and do not result from an act or omission of the Party), casualty, war, acts of terrorism or riots. Unavoidable Delay shall not include delay caused by a Party's financial condition, illiquidity, or insolvency. ARTICLE III PUBLIC PARCELS DISPOSITION; AS -IS SALE Section 3.1 Purchase and Sale. City shall sell the City Parcels to Developer and Developer shall purchase the City Parcels from City pursuant to the terms and conditions of this Agreement. For the purposes of exchanging funds and documents to complete the sale from City to Developer and the purchase by Developer from City of the City Parcels, pursuant to the terms and conditions of this Agreement, City and the Developer agree to open the Escrow with the Escrow Holder. ARTICLE IV of this Agreement constitutes the joint escrow instructions of the Parties to the Escrow Holder for the conduct of the Escrow for the sale of the Property. Developer and City shall execute the Escrow Holder's standard or general escrow instructions, provided, however, that the provisions of this Agreement shall be controlling, in the event of any conflict between the provisions of this Agreement and any such standard or general escrow instructions requested by the Escrow Holder. Section 3.2 Payment of Purchase Price. As further described in this Section 3.2, Developer shall deposit the Purchase Price less the sum of (a) the City Loan, and (b) the Earnest Money Deposit (for which Developer will receive a credit), into the Escrow in immediately available funds, as provided in this Agreement. (a) Earnest Money Deposit. Concurrent with its opening of the Escrow, Developer shall deposit the Initial Deposit into the Escrow. Upon Developer's acceptance of the City Parcels in a Due Diligence Investigation Conclusion Notice pursuant to Section 3.3, (i) Developer shall deposit the Additional Deposit into the Escrow, and (ii) Escrow Holder shall promptly release the entire Earnest Money Deposit to City. Upon the Close of Escrow, the Earnest Money Deposit shall be credited to Developer toward the Purchase Price. In the event the Close of Escrow does not occur as a result of the failure of one of Developer's conditions to closing to be satisfied, or waived by Developer, pursuant to the terms of this Agreement, or a material default by City, the Earnest Money Deposit shall be refundable to Developer. Notwithstanding anything in this Agreement to the contrary, a portion of the Earnest Money Deposit, in the amount of One Hundred Dollars ($100) (the "Independent Contract Consideration"), shall be released immediately to City as consideration for City's execution and delivery of this Agreement 882/012782-0020 g902i0i06/01/20 -16- March 19, 2019 Item #3.1 Resolution No. 19-013 and Developer's right to approve or disapprove any Developer contingencies set forth in this Agreement with respect to the Property. The Independent Contract Consideration is in all respects nonrefundable to Developer. (b) At Close of Escrow. At least one (1) business day preceding the Escrow Closing Date, Developer shall deposit into the Escrow the Purchase Price less the sum of (a) the Earnest Money Deposit, and (b) the City Loan. (c) Title Approval. As soon as practicable following the Escrow Opening Date, City shall obtain the Preliminary Report from the Title Company and deliver a copy of the Preliminary Report to Developer. In addition to the foregoing, Developer shall have a right, at its own cost, to conduct a survey of the City Parcels. Within forty-five (45) days following Developer's receipt of the Preliminary Report, Developer shall deliver the Developer's Title Notice to City. If Developer fails to deliver Developer's Title Notice to City, within such forty-five (45) day period, Developer will be deemed to approve the status of title to the City Parcels and to accept title to the City Parcels. Within twenty (20) days following the earlier of City's receipt of Developer's Title Notice or expiration of the time period provided in this Section 3.2 for delivery of Developer's Title Notice, City shall serve City's Title Notice Response. If the Developer's Title Notice does not disapprove any matter in the Preliminary Report, City shall not be required to serve City's Title Notice Response. If City does not serve City's Title Notice Response, if necessary, within twenty (20) days following its receipt of the Developer's Title Notice, City shall be deemed to elect not to cause any matter disapproved in the Developer's Title Notice to be removed from the Preliminary Report. If City elects in City's Title Notice Response to cause the removal of any matter disapproved in Developer's Title Notice from the Preliminary Report, City shall cause the removal of each such matter from the Preliminary Report, prior to or concurrently with the Escrow Closing Date. Notwithstanding anything herein to the contrary, City shall be obligated to remove from record, on or before the Escrow Closing Date, any liens, claims, encumbrances, deeds of trust or mortgages encumbering the Property, except to the extent directly caused by Developer. If City elects or is deemed to have elected not to cause the removal of any matter disapproved in the Developer's Title Notice from the Preliminary Report, then, within ten (10) days following the earlier of Developer's receipt of City's Title Notice Response or the expiration of the time period provided in this Section 3.2 for delivery of City's Title Notice Response, Developer shall either: (1) refuse to accept the title to and conveyance of the Property by delivering the Developer's Second Title Notice to City, or (2) waive its disapproval of any matters set forth in the Developer's Title Notice by delivering the Developer's Title Notice Waiver to City. Failure by Developer to deliver Developer's Title Notice Waiver, where City's Title Notice Response or City's failure to serve City's Title Notice Response indicates or results in City's election not to cause the removal of any one or more matters disapproved in Developer's Title Notice from the Preliminary Report, within ten (10) days following Developer's receipt of City's Title Notice Response or expiration of the time period for City to deliver City's Title Notice Response under this Agreement, will be deemed Developer's agreement to accept the title to and conveyance of the City Parcels. In the event Developer delivers Developer's Second Title Notice to City, either City or Developer shall have the right to cancel the Escrow and terminate this Agreement, each in their respective sole and absolute discretion, by delivery of a written 882/012782-0020 ity98foirio1/20 -17- March 19, 2019 Item #3.1 Resolution No. 19-013 notice of termination to both the other Party and the Escrow Holder, in which case the Parties and the Escrow Holder shall proceed pursuant to Section 4.10. (d) In the event that a Supplement is issued, the Parties shall follow and otherwise abide by the same process set forth in Section 3.2(c). Section 3.3 Developer Due Diligence Investigations. (a) City represents to Developer that prior to the Effective Date, City has provided Developer with hard copies, electronic files, or other access to all reports, plans, studies and other similar records with respect to the City Parcels (collectively, "City Reports") that are in City's possession and reasonably known to City. Developer acknowledges and agrees that (i) the City Parcels were acquired at different times and by various City entities, and (ii) although City has reviewed its real property files for City Reports, City has not conducted a comprehensive search of all City files for City Reports. (b) Developer shall complete all of its Due Diligence Investigations within the Due Diligence Period and shall conduct all of its Due Diligence Investigations at its sole cost and expense. (c) City licenses, permits and authorizes Developer to enter the City Parcels for the sole purpose of conducting Developer's Due Diligence Investigations, subject to all of the terms and conditions of this Agreement. Developer shall have the right, but not the obligation, to engage in environmental testing, soils testing and surveying on the City Parcels. Following the conduct of any Due Diligence Investigations on the City Parcels, Developer shall restore the City Parcels to substantially its condition prior to the conduct of such Due Diligence Investigations. (d) Any Due Diligence Investigations of the City Parcels by Developer shall not unreasonably disrupt any then -existing use or occupancy of the City Parcels or the operations of City, including without limitation the use by Poway Stoway Self -Storage of the 13033 Poway Road Parcel pursuant to the Poway Stoway Self -Storage Lease. The activities of Developer or its agents directly or indirectly related to Developer's Due Diligence Investigations shall be subject to Developer's indemnity, defense and hold harmless obligations pursuant to Section 9.8. Prior to commencing any Due Diligence Investigations on the City Parcels, Developer shall deliver all copies of policies or certificates of insurance required to be delivered pursuant to Section 5.11. (e) Developer shall deliver to City and the Escrow Holder prior to the end of the Due Diligence Period a Due Diligence Investigation Conclusion Notice that either rejects the City Parcels or unconditionally accepts the City Parcels. If Developer does not deliver a Due Diligence Investigation Conclusion Notice unconditionally accepting the City Parcels prior to the end of the Due Diligence Period, then Developer shall be deemed to have accepted the Property and agreed to accept conveyance of title to the City Parcels. If the City Parcels are rejected by Developer, then each of City or Developer shall have the right, in their sole and absolute discretion, to cancel the Escrow and terminate this Agreement, by delivery of a written notice of termination to the other Party 882/012782-0020 � 3902�,0� 06/01 /20 -18- March 19, 2019 Item #3.1 Resolution No. 19-013 and the Escrow Holder, in which case the Parties and the Escrow Holder shall proceed pursuant to Section 4.10. Section 3.4 Developer to Obtain all Project Approvals. (a) Following the Escrow Opening Date, City shall reasonably consent, as necessary, to Developer processing necessary entitlements, permits or applications with each Governmental Agency for development of the Project, including, as necessary, the City Manager signing any such applications on behalf of the City, as the owner of the City Parcels. (b) Developer shall, within the time period(s) for such actions set forth in the Schedule of Performance (subject to Unavoidable Delays), prepare and submit a complete application and any other required application, document, fee, charge or other item (including, without limitation, deposit, fund or surety) required for construction of the Project, pursuant to all Governmental Requirements, to each necessary Governmental Agency for review and approval. City's zoning, building and land use regulations (whether contained in ordinances, City's municipal code, conditions of approval or elsewhere), shall be applicable to the construction of the Project by Developer, pursuant to this Agreement. Developer acknowledges that all plans and specifications and any changes to plans and specifications for the Project shall be subject to all Governmental Requirements. No action by City with reference to this Agreement or any related documents shall be deemed to constitute a waiver of any required City permit, approval or authorization regarding the City Parcels, the Project, Developer, any successor -in -interest of the Developer or any successor -in -interest to the City Parcels. (c) The approval of this Agreement by City shall not constitute a pre - commitment by City or the City Council of City regarding any approvals required for development of the Project, including, without limitation, all required analysis under CEQA. Developer obtains no right or entitlement to construct the Project by virtue of this Agreement. City reserves unfettered discretion to approve, conditionally approve, or deny any entitlements and/or other approvals required for the Project and all proceedings and decisions in connection therewith. This Agreement shall not be construed as a grant of development rights or land use entitlements to construct the Project on the Property. All design, architectural, and building plans for the Project shall be subject to the review and approval of City and any other Governmental Agency. By its execution of this Agreement, City is not committing itself to or agreeing to undertake any acts or activities requiring the subsequent independent exercise of discretion by City or any agency or department thereof. (d) If any revisions of the Project are required by a Governmental Agency, Developer shall promptly make any such revisions, provided such revisions are generally consistent with the Scope of Development. (e) Notwithstanding any provision to the contrary in this Agreement, Developer agrees to abide by and comply fully with any and all conditions of approval applicable to all approvals, permits and other governmental actions regarding the 882/012782-0020 ii98foig6to1/20 -19- March 19, 2019 Item #3.1 Resolution No. 19-013 construction of the Project; provided, however, that Developer reserves its rights to challenge any illegally imposed condition of approval applicable to an approval, permit, or other governmental action regarding the construction of the Project. (f) Developer and City agree that City shall not provide any financial assistance to Developer in connection with the construction of the Project. Developer shall be solely responsible for paying for the costs of all design work, construction, labor, materials, fees, permit, application, surety bond and other expenses associated with the Project. Developer shall pay any and all fees pertaining to the review and approval of the Project by each Governmental Agency and utility service providers, including the costs of preparation of all required construction, planning and other documents reasonably required by each Governmental Agency or utility service provider pertinent to the construction of the Project, including, but not limited to, specifications, drawings, plans, maps, permit applications, land use applications, zoning applications, environmental review and disclosure documents and design review documents. Developer shall obtain any and all necessary governmental approvals, prior to the commencement of applicable portions of construction of the Project, and Developer shall take all necessary precautions to ensure the safety and stability of surrounding properties during the construction of the Project. (g) Developer shall obtain all entitlements, permits and other approvals for construction of the Project from each Governmental Agency, within the time periods for such actions set forth in the Schedule of Performance, subject to any extensions of time authorized by this Agreement upon the occurrence of an Unavoidable Delay. Section 3.5 Notice to Vacate. Within five (5) business days after the occurrence of the Entitlement Approval Date, City shall deliver to each tenant and occupant of any occupied City Parcels a written notice of termination. Section 3.6 Quate Court. If requested in writing by Developer, City staff will agendize, for City Council consideration, Developer's request to vacate Quate Court. ARTICLE IV JOINT ESCROW INSTRUCTIONS Section 4.1 Opening of Escrow. City and Developer shall cause the Escrow to be opened within five (5) days following the Effective Date. Escrow Holder shall promptly confirm in writing to each of the Parties the date of the Escrow Opening Date. This ARTICLE IV shall constitute the joint escrow instructions of City and Developer to Escrow Holder for conduct of the Escrow. Section 4.2 Conditions to Close of Escrow. The conditions set forth below in this Section 4.2 shall be satisfied or waived by the respective benefited Party on or before the Escrow Closing Date or the Party benefited by any unsatisfied condition shall not be required to proceed to close the Escrow. (a) Developer's Conditions. Developer's obligation to purchase the City Parcels from City on the Escrow Closing Date shall be subject to the satisfaction or waiver 882/012782-0020 ig98i0ig6/01/20 -20- March 19, 2019 Item #3.1 Resolution No. 19-013 of each of the following conditions precedent, each of which can only be waived in writing by Developer, in Developer's sole and absolute discretion: (1) Developer has not timely elected to terminate the Escrow and this Agreement pursuant to the provisions in Section 3.2; (2) The occurrence of the Entitlement Approval Date; (3) The Title Company is unconditionally committed to issue the Developer's Title Policy to Developer, at the Close of Escrow; (4) City has deposited all of the items into the Escrow required by Section 4.4; (5) Developer has reasonably approved the Escrow Holder's final estimated closing/settlement statement; (6) The escrow under the Private Parcels Purchase Agreements has closed, and Developer has acquired fee title to the Private Parcels; (7) City has acquired fee title to all of the City Parcels; (8) The escrow under the AHPDA has closed, and Developer has acquired fee title to the Affordable Housing Parcel; (9) The City Council of City has approved, and City and Developer have entered into, a Development Agreement; (10) Developer has obtained all City permits required to complete the rough grading of the Property; (11) The City Parcels have been vacated and are free from occupancy; and (12) City has performed all of its material obligations required to be performed by City under this Agreement prior to Close of Escrow; and is not in default of any of its obligations under this Agreement. (b) City's Conditions. City's obligation to sell the City Parcels to Developer on or before the Escrow Closing Date shall be subject to the satisfaction or waiver of each of the following conditions precedent, which can only be waived in writing by City, in City's sole and absolute discretion: (1) Developer has deposited the Earnest Money Deposit into Escrow, pursuant to Section 3.2(a), and the Earnest Money Deposit has been released to City; 882/012782-0020 itylig6to1/20 -21- March 19, 2019 Item #3.1 Resolution No. 19-013 (2) Developer has not timely elected to terminate the Escrow and this Agreement pursuant to the provisions in Section 3.2; (3) The occurrence of the Entitlement Approval Date; (4) Developer has provided evidence reasonably satisfactory to City that Developer has sufficient financing, or Developer has obtained commitments for sufficient financing, to develop the Project in accordance with the Project Budget, and any such financing for which Developer has obtained commitments shall close and be available to Developer on the Escrow Closing Date; (5) Developer has delivered to City, at least fourteen (14) days prior to the Escrow Closing Date, a legally binding written contract between Developer and a general contractor, licensed in California, experienced in the construction of projects similar to the Project, for the construction of the Project, which general contractor may be an Affiliate of Developer provided that the terms of the construction contract are standard, competitive, market -based terms; (6) Developer has deposited all of the items into Escrow required by Section 4.3; (7) City has reasonably approved the Escrow Holder's final estimated closing/settlement statement; (8) The escrow under the Private Parcels Purchase Agreements has closed and Developer has acquired fee title to the Private Parcels, (9) City has acquired fee title to all of the City Parcels; (10) The escrow under the AHPDA has closed and Developer has acquired fee title to the Affordable Housing Parcel; (11) Developer has performed all of its material obligations required to be performed by Developer under this Agreement prior to Close of Escrow; and is not in default of any of its obligations under this Agreement; (12) The Title Company is unconditionally committed to issue the City's Title Policy to City, at the Close of Escrow; (13) Developer has obtained all City permits required to complete the rough grading of the Property; (14) Developer, at its sole cost and expense, shall have provided to City all studies, reports, data, and supporting materials necessary for City to conduct all required analysis under CEQA, City shall have completed such analysis, and the City Council or City Planning Commission (as applicable), in its sole and absolute discretion, shall have made all requisite findings, determinations, and/or certifications necessary to enable the Project to move forward; 882/012782-0020 ig98fig6/o 1 /20 -22- March 19, 2019 Item #3.1 Resolution No. 19-013 (15) The City Parcels have been vacated and are free from occupancy; (16) The representations, warranties and covenants of Developer set forth in ARTICLE VIII are true and correct in all material respects on the Effective Date and continuing through and including on the Escrow Closing Date; (17) Developer has provided City with a residential real estate report or other documentation and/or analysis reasonably acceptable to the City Manager evidencing that the residential real estate market for new "for -sale" multifamily homes in general, and in the City of Poway in particular is in a condition to enable Developer to sell not less than twelve (12) "for -sale" multifamily homes (the "First Phase"), and (18) Developer has delivered to City organizational documents evidencing the establishment and good standing of Developer, and the authority of Developer to enter into this Agreement and perform its obligations hereunder. Section 4.3 Developer's Escrow Deposits. Following satisfaction or waiver of each of Developer's conditions to the Close of Escrow set forth in Section 4.2(a), at least one (1) business day prior to the Escrow Closing Date scheduled by the Escrow Holder in a writing delivered to each of the Parties, Developer shall deposit the following funds and documents into the Escrow and, concurrently, provide a copy of each such document to City: (a) Purchase Price. The Purchase Price, less the sum of (i) the Earnest Money Deposit, and (ii) the City Loan, plus any additional funds required to be deposited into the Escrow by Developer under the terms of this Agreement to close the Escrow, all in immediately available funds; (b) PCO Report. A Preliminary Change of Ownership Report executed by the authorized representative(s) of Developer; (c) Memorandum of Agreement. The Memorandum of Agreement executed by the authorized representative(s) of Developer in recordable form; (d) City Note. The City Note, executed by the authorized representative(s) of Developer; and (e) City Deed of Trust. The City Deed of Trust, executed by the authorized representative(s) of Developer. Section 4.4 City's Escrow Deposits. Following satisfaction or waiver of each of City's conditions to Close of Escrow set forth in Section 4.2(b), at least one (1) business day prior to the Escrow Closing Date scheduled by the Escrow Holder in a writing delivered to each of the Parties, City shall deposit the following funds and documents into the Escrow and, concurrently, provide a copy of each such document to Developer: 882/012782-0020 igylig6/o1/20 -23- March 19, 2019 Item #3.1 Resolution No. 19-013 (a) City Grant Deed. The City Grant Deed executed by the authorized representative(s) of City in recordable form; (b) FIRPTA Affidavit. The FIRPTA Affidavit completed and executed by the authorized representative( s) of City; (c) Memorandum of Agreement. The Memorandum of Agreement executed by the authorized representative(s) of City in recordable form; and (d) Form 593. A Form 593 executed by the authorized representative(s) of City. Section 4.5 Closing Procedure. When each of Developer's Escrow deposits, as set forth in Section 4.3, and each of City's Escrow deposits, as set forth in Section 4.4, are deposited into the Escrow, the Escrow Holder shall request confirmation in writing from both City and Developer that each of their respective conditions to the Close of Escrow, as set forth in Section 4.2, are satisfied or waived. Upon the Escrow Holder's receipt of written confirmation from both City and Developer that each of their respective conditions to the Close of Escrow are either satisfied or waived, the Escrow Holder shall close the Escrow by doing all of the following: (a) Insertion of Dates. Insert the Escrow Closing Date into the City Grant Deed, Memorandum of Agreement, City Note, and City Deed of Trust, as the date of such document, prior to the recordation of the City Grant Deed, Memorandum of Agreement and City Deed of Trust; (b) Recordation of Documents. File the City Grant Deed, the Memorandum of Agreement, and City Deed of Trust (as applicable) with the Office of the Recorder of the County of San Diego, California, for recordation in the order set forth in Section 4.7; (c) Distribution of Recorded Documents. Distribute conformed copies of each recorded document to the Party or person designated for such distribution in Section 4.7; (d) PCO Report. File the PCO Report with the Office of the Recorder of the County of San Diego, California; (e) FIRPTA Affidavit. Deliver the FIRPTA Affidavit to Developer, and deliver a copy to City; (f) Form 593. Deliver the Form 593 to Developer, and deliver a copy to City; (g) Developer's Title Policy. Obtain and deliver to Developer the Developer's Title Policy; 882/012782-0020 iy96i0ig6/01/20 (h) City's Title Policy. Obtain and deliver to City the City's Title Policy; -24- March 19, 2019 Item #3.1 Resolution No. 19-013 (i) Purchase Price. Deliver the Purchase Price to City, less the sum of (i) the Earnest Money Deposit, (ii) the City Loan, and (iii) any other charges to the account of City, and return all remaining funds held by the Escrow Holder for the account of Developer to Developer, less Developer's share of the Escrow closing costs, and less any other charges chargeable to the account of Developer under the terms of this Agreement; and (j) Report to IRS. Following the Close of Escrow and prior to the last date on which such report is required to be filed with the Internal Revenue Service, if such report is required pursuant to Section 6045(e) of the Internal Revenue Code, the Escrow Holder shall report the gross proceeds of the purchase and sale of the Property to the Internal Revenue Service on Form 1099-B, W-9 or such other form(s) as may be specified by the Internal Revenue Service pursuant to Section 6045(e). Upon the filing of such reporting form with the Internal Revenue Service, the Escrow Holder shall deliver a copy of the filed form to City and Developer. Section 4.6 Close of Escrow. Close of Escrow shall occur on or before the Escrow Closing Date. If for any reason the Close of Escrow has not occurred on or before the Escrow Closing Date, then any Party not then in default of this Agreement may cancel the Escrow and terminate this Agreement, without liability to the other Party or any other person for such cancellation and termination, by delivering written notice of termination to both the other Party and the Escrow Holder and, thereafter, the Parties shall proceed pursuant to Section 4.10. Without limiting the right of either Party to cancel the Escrow and terminate this Agreement pursuant to the preceding sentence, if the Escrow does not close on or before the Escrow Closing Date, and neither Party has exercised its contractual right to cancel the Escrow and terminate this Agreement before such time, then the Escrow shall close as soon as reasonably possible following the first date on which the Escrow Holder is in a position to close the Escrow, pursuant to the terms and conditions of this Agreement. Section 4.7 Recordation and Distribution of Documents. Escrow Holder shall cause the following documents to be recorded in the official records of the Recorder of the County of San Diego, California, in the following order at the Close of Escrow: (i) the City Grant Deed, (ii) the City Deed of Trust, (iii) the Memorandum of Agreement, and (iv) any other documents to be recorded through the Escrow upon the joint instructions of the Parties. The Escrow Holder shall deliver conformed copies of all documents recorded through the Escrow to City and Developer and any other person designated in the joint escrow instructions of the Parties to receive a conformed copy of each such document, each showing all recording information. Section 4.8 Escrow Closing Costs, Taxes and Title Policy Premium. Developer and City shall each pay half of the documentary transfer taxes, Escrow fees, and such other costs as the Escrow Holder may charge for the conduct of the Escrow. The Escrow Holder shall notify Developer and City of the costs to be borne by each of Developer and City at the Close of Escrow by delivering the Escrow Holder's estimated closing/settlement statement to both City and Developer, at least, four (4) business days prior to the Escrow Closing Date. City shall pay the premium charged by the 882/012782-0020 ig9(2A0i 506/01 /20 -25- March 19, 2019 Item #3.1 Resolution No. 19-013 Title Company for the Developer's Title Policy, with standard coverage, and for the City's Title Policy; provided, however, that Developer shall pay the costs of any endorsements or other supplements to the coverage of the Developer's Title Policy that may be requested by Developer, including the additional cost for extended ALTA coverage, if such coverage is elected by Developer. City shall pay any and all recording fees, and any and all other charges, fees and taxes levied by a governmental authority relative to the conveyance of the Property through the Escrow. Section 4.9 Escrow Cancellation Charges. If the Escrow fails to close due to City's material default under this Agreement, City shall pay all ordinary and reasonable cancellation charges relating to the Escrow, the Developer's Title Policy and the City's Title Policy. If the Escrow fails to close due to Developer's material default under this Agreement, or for any reason other than the material default of City, Developer shall pay all ordinary and reasonable cancellation charges relating to the Escrow, the Developer's Title Policy, and the City's Title Policy. Section 4.10 Escrow Cancellation. If the Escrow is cancelled and this Agreement is terminated pursuant to a contractual right granted to a Party in this Agreement to cancel the Escrow and terminate this Agreement, other than due to the default of another Party, the Parties shall do each of the following: (a) Cancellation Instructions. The Parties shall, within three (3) business days following receipt of the Escrow Holder's written request, execute any reasonable Escrow cancellation instructions requested by the Escrow Holder; (b) Return of Funds and Documents. Within ten (10) days following receipt by the Parties of a settlement statement from the Escrow Holder of cancellation charges regarding the Escrow, the Developer's Title Policy, and the City's Title Policy, if any: (i) Developer or the Escrow Holder shall return to City any documents previously delivered by City to Developer or the Escrow Holder regarding the Escrow, (ii) City or the Escrow Holder shall return to Developer all documents previously delivered by Developer to City or the Escrow Holder regarding the Escrow; and (iii) the Escrow Holder shall return to Developer any funds deposited into the Escrow, except as otherwise provided in either Section 3.2(a) or Section 9.3, less the customary and reasonable Escrow and title order cancellation charges regarding the Escrow, the Developer's Title Policy, and the City's Title Policy, if any. Section 4.11 Entitlement Claims; CEQA Claims. If any Entitlement Claims and/or CEQA Claims are taken or filed, then Developer shall have the right to elect to either defend the same or not defend the same, at Developer's cost, including, without limitation, all of the court costs, attorney fees, monetary awards, sanctions, attorney fee awards, expert witness and consulting fees, and the expenses of any and all financial or performance obligations resulting from the disposition of the legal action. If Developer elects to so defend the same, then Developer shall appoint counsel and direct strategy; provided, however, that such counsel shall be acceptable to City. If Developer elects not to so defend, then either City or Developer shall have the right to terminate this Agreement. 882/012782-0020 iggig6/01/20 -26- March 19, 2019 Item #3.1 Resolution No. 19-013 ARTICLE V PROJECT DEVELOPMENT Section 5.1 Developer Covenant to Undertake Project. Developer covenants and agrees for itself and its successors and assigns, to and for the exclusive benefit of City, that Developer shall develop the Project in a good and workmanlike manner, within the applicable time periods set forth in the Schedule of Performance, and in conformity with the terms and conditions of this Agreement, the Scope of Development, the Entitlements, any and all plans, specifications and similar development documents required by this Agreement and approved by City, including all conditions of approval issued in connection with any of the foregoing approvals, except for such changes as may be mutually agreed upon in writing by and between Developer and City, and all applicable laws, regulations, orders and conditions of each Governmental Agency. The covenants of this Section 5.1 shall run with the land of the City Parcels until the Project Completion Date. Section 5.2 Developer Changes to Project Plans and Specifications During Course of Construction. Developer shall have the right, during the course of construction of the Project, to make "Minor Field Changes" (as defined in the following sentence), without seeking the approval of City, if such changes do not affect the type of use to be conducted within all or any portion of a structure. "Minor Field Changes" shall be defined as those changes from the approved construction drawings, plans and specifications that: (1) have no substantial effect on the Project and are made in order to expedite, clarify or facilitate the work of construction in response to field conditions; (2) are changes to the Project's interior spaces that substantially conform to the drawings, plans, and specifications and/or are required pursuant to an applicable law by a lender or equity partner; (3) are changes that represent the selection of a particular design option or feature; (4) are changes that are required under applicable laws; and/or (5) are changes dictated by the identification of any unforeseen conditions. Nothing contained in this Section 5.2 shall be deemed to constitute a waiver of or change in any Governmental Requirements governing any such Minor Field Changes or in any approvals by any Governmental Agency otherwise required for any such Minor Field Changes. Section 5.3 Completion of Project. (a) Upon Developer's completion of the Project, Developer shall: (1) Record a Notice of Completion, in accordance with California Civil Code Section 3093, for the entirety of the Project; (2) Cause the Project to be inspected by each Governmental Agency and correct any defects and deficiencies that may be disclosed by any such inspection; and (3) Cause all occupancy certificates and other licenses, permits and authorizations necessary for the operation and occupancy of the completed Project to be duly issued. 882/012782-0020 4006I01I2O -27- March 19, 2019 Item #3.1 Resolution No. 19-013 (b) After commencement of the work of improvement of the Project, Developer shall not permit the work of improvement of the Project to cease or be suspended for a time period in excess of thirty (30) calendar days, either consecutively or in the aggregate. Notwithstanding the foregoing, such thirty (30) calendar day period may be extended by the City Manager for up to an additional thirty (30) calendar days, in the aggregate, unless caused by Unavoidable Delays. Section 5.4 Compliance with Laws. All work performed in connection with the construction of the Project shall comply with all Governmental Requirements. Section 5.5 Schedule of Performance. All planning, construction, and other development obligations and responsibilities of Developer related to the Project shall be initiated and completed within the times specified in the Schedule of Performance, or within such reasonable extensions of such times granted by City in writing or as otherwise provided for in this Agreement. Section 5.6 Developer Attendance at City Meetings. Developer agrees to have one or more of its employees or consultants who are knowledgeable regarding this Agreement and the development of the Project, such that such person(s) can meaningfully respond to City staff questions regarding the progress of the Project, attend meetings with City staff or meetings of the Poway City Council, when requested to do so by City staff. Section 5.7 City Right to Inspect Project and Property. Officers, employees, agents and representatives of City shall have the right of reasonable access to the Property, without the payment of charges or fees, during normal construction hours, during the period of construction of the Project. Any and all officers, employees, agents or representatives of City who enter the Property shall identify themselves at the construction management office or, if none, to the apparent on -site construction supervisor on the Property, upon their entrance onto the Property, and shall at all times be accompanied by a representative of Developer, while on the Property. Developer shall make a representative of Developer available for this purpose at all times during normal construction hours, upon reasonable advance notice from City. If in City's reasonable judgment it is necessary, City shall have the further right, from time to time, to retain a consultant or consultants to inspect the Project and verify compliance by Developer with the provisions of this Agreement. Developer acknowledges and agrees that any such City inspections are for the sole purpose of protecting City's rights under this Agreement, are made solely for City's benefit, may be superficial and general in nature, and are for the purposes of informing City of the progress of the Project and the conformity of the Project with the terms and conditions of this Agreement, and that Developer shall not be entitled to rely on any such inspection(s) as constituting City's approval, satisfaction or acceptance of any materials, workmanship, conformity of the Project with this Agreement or otherwise. Developer agrees to make its own regular inspections of the work of construction of the Project to determine that the quality of the Project and all other requirements of the work of construction of the Project are being performed in a manner satisfactory to Developer. 882/012782-0020 4006/O1I2O -28- March 19, 2019 Item #3.1 Resolution No. 19-013 Section 5.8 Construction in Compliance with Applicable Laws. (a) Developer shall be solely responsible, expressly or impliedly and legally and financially, for determining and effectuating compliance with all applicable federal, state and local public works requirements, prevailing wage laws, and labor laws and standards, and City makes no representation, either legally and/or financially, as to the applicability or non -applicability of any federal, state and local laws to Developer's construction of the Project. Developer expressly, knowingly and voluntarily acknowledges and agrees that City has not previously represented to Developer or to any representative, agent or affiliate of Developer, or any contractor(s) or any subcontractor(s) for the construction or development of the Project, in writing or otherwise, in a call for bids or otherwise, that the work and construction of the Project is (or is not) a "public work," as defined in Section 1720 of the Labor Code or under the Davis -Bacon Act, 40 U.S.C. Section 3141, et seq., and the regulations promulgated thereunder set forth at 29 CFR Part 1 (collectively, "Davis -Bacon"). (b) Developer knowingly and voluntarily agrees that Developer shall have the obligation to provide any and all disclosures or identifications as and to the extent required by Labor Code Section 1781 and/or by Davis -Bacon, as the same may be amended from time to time, or any other similar law or regulation. Developer shall indemnify, protect, pay for, defend and hold harmless City, with legal counsel reasonably acceptable to City from and against any and all loss, liability, damage, claim, cost, expense and/or "increased costs" (including reasonable attorney's fees, court and litigation costs, and fees of expert witnesses) which, in connection with the development, construction (as defined by applicable law) and/or operation of the Project, including, without limitation, any and all public works (as defined by applicable law), results or arises in any way from any of the following: (i) the noncompliance by Developer or its contractor with any applicable local, state and/or federal law or regulation, including, without limitation, any applicable federal and/or state labor laws or regulations (including, without limitation, if applicable, the requirement to pay state and/or federal prevailing wages and hire apprentices); (ii) the implementation of Section 1781 of the Labor Code and/or of Davis -Bacon, as the same may be amended from time to time, or any other similar law or regulation; and/or (iii) failure by Developer to provide any required disclosure or identification as required by Labor Code Section 1781 and/or by Davis -Bacon, as the same may be amended from time to time, or any other similar law or regulation. It is agreed by the Parties that, in connection with the development and construction (as defined by applicable law or regulation) of the Project, including, without limitation, any and all public works (as defined by applicable law or regulation), Developer shall bear all risks of payment or non-payment of prevailing wages under applicable federal, state and local law or regulation and/or the implementation of Labor Code Section 1781 and/or by Davis -Bacon, as the same may be amended from time to time, and/or any other similar law or regulation. The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the construction and development of the Project. "Increased costs," as used in this Section 5.8, shall have the meaning ascribed to it in Labor Code Section 1781, as the same may be amended from time to time. 882/012782-0020 4927006I01I2O -29- March 19, 2019 Item #3.1 Resolution No. 19-013 DEVELOPER, ON BEHALF OF ITSELF, ITS SUCCESSORS, AND ASSIGNS, WAIVES AND RELEASES CITY FROM ANY RIGHT OF ACTION THAT MAY BE AVAILABLE TO ANY OF THEM PURSUANT TO LABOR CODE SECTION 1781. DEVELOPER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 5.8, WHICH READS AS FOLLOWS: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH 1F KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. BY INITIALING BELOW, DEVELOPER KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS AND RELEASES OFT • �'• ECT1ON 5.8: all rrs Initials Section 5.9 AS -IS SALE; RELEASE (a) Developer acknowledges, agrees, and represents to City that Developer is experienced In the acquisition and development of land similar to the City Parcels and that as of the Close of Escrow, it has been given an adequateopportunity to review and inspect, and has approved ati aspects of, the City Parcels. Developer shall rely solely and exclusively upon the results of its Due Diligence Investigations of the City Parcels, including, without limitation, investigations regarding geotechnical soil conditions, compliance with applicable laws pertaining to the use of the Cry Parcels by Developer and any other maw relevant to the condition or suitability of the City Parcels for the Project, as Developer may deem necessary or appropriate. City makes no representation or warranty to Developer relating to the condition of (he City Parcels or suitability of the City Parcels for any intended use or development by Developer. (b) Developer shall accept all conditions of the City Parcels, without any liability of City whatsoever, upon Developer's acceptance of the City Parcels indicated m its Due Diligence Investigation Conclusion Notice, or Developer's deemed acceptance of the City Parcels by Developer's failure to deliver a Due Dligence Investigation Conclusion Notice. Developer's delivery of its Due Diligence Investigation Conclusion Notice indicating Developer's unconditional acceptance of the City Parcels, or Developer's deemed acceptance of the City Parcels by Developer's failure to deliver a Due Diligence Investigation Conclusion Notice, shall evidence Developer's unconditional and irrevocable acceptance of the City Parcels in the Public Paroel's AS IS, WHERE IS, SUBJECT TO ALL FAULTS CONDITION, WITHOUT WARRANTY AS TO QUALITY, CHARACTER, PERFORMANCE OR CONDITION and with full knowledge of the physical condition of the City Parcels, ail zoning, other land use laws and other Governmental ae2/0127ez-0oao ���sno -30- March 18, 2019 Item #3.1 Resolution No. 19-013 Requirements affecting the City Parcels, and of the conditions, restricfions, encumbrances and all matters of record relating to the City Parcels. Developer's delivery of its Due Diligence Investigation Conclusion Notice indicating Developer's unconditional acceptance of the City Parcels, Of Developer's deemed acceptance of the City Parcels by Developer's failure to defMer a Due Diligence Investigation Conclusion Notice, shall constitute Devefaper's representation and warranty to City that Developer has received assurances acceptable to Developer by means independent of City or any agent of City of the truth of all facts material to Developer's acquisition of the City Parcels pursuant to this Agreement, and that the City Parcels are being acquired by Developer as a result of is awn knowledge, inspection and investigation of the City Parcels and not as a result of any representations made by City or any employee, official, consultant or agent of City wing to the condition of the City Parcels, unless such statement or representation is expressly and specifically set forth in this Agreement. City hereby expressly and wily disclaims any express or implied warranties regarding the City Parcels. DEVELOPER, ON BEHALF OF ITSELF, ITS SUCCESSORS, AND ASSIGNS, WAIVES AND RELEASES CITY FROM ANY RIGHT OF ACTION THAT MAY BE AVAILABLE TO ANY OF THEM WITH RESPECT TO THE CONDITION OF THE PUBLIC PARCELS. DEVELOPER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 5.9, WHICH READS AS FOLLOWS: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY H I M OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. BY INITIALING BELOW, DEVELOPER KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS AND RELEASES OF THIS SEEK ON 5.9: Deve s Initials " Section 5.10 Environmental Indemnity of City by Developer. On and after the Escrow Closing Date, Developer agrees, at its sole cost and expense, to fully indemnify, protect, hold harmless, and defend (with counsel selected by Developer and approved by City) City and City Personnel, and each of them, from and against any and all claims, demands, damages, losses, liabilities, obligations, penalties, fines, actions, causes of action, judgments, suits, proceedings, costs, disbursements and expenses, including, without limitation, attorney fees, disbursements and costs of attorneys, environmental consultants and other experts, and all foreseeable and unforeseeable damages or costs of any kind or of any nature whatsoever (collectively, "Environmental Losses") that may, at any time, be imposed upon, incurred or suffered by, or claimed, asserted or awarded against, City directly or indirectly relating to or arising from any of the following a2/ot27ez�oo2o �a0011S/19 3 -31- March 19, 2019 item #3.1 Resolution No. 19-013 "Environmental Matters" occurring during and/or arising from Developer's ownership of the Property or construction or operation of the Project: (a) the presence of Hazardous Substances on, in, under, from or affecting all or any portion of the Property or the Project. (b) The storage, holding, handling, release, threatened release, discharge, generation, leak, abatement, removal or transportation of any Hazardous Substances on, in, under, from or affecting the Property or the Project. (c) The violation of any law, rule, regulation, judgment, order, permit, license, agreement, covenant, restriction, requirement or the like by Developer, its agents or contractors, relating to or governing in any way Hazardous Substances on, in, under, from or affecting the Property or the Project. (d) The violation of any law, rule, regulation, judgment, order, permit, license, agreement, covenant, restriction, requirement or the like by Developer, its agents or contractors, relating to or governing in any way the discharge of storm water on, in, under, from or affecting the Property or the Project, and the failure of Developer, its agents or contractors to comply with any permit issued pursuant to the National Pollutant Discharge Elimination System and applicable to the Project and/or Property. (e) The failure of Developer, its agents or contractors, to properly complete, obtain, submit and/or file any and all notices, permits, licenses, authorizations, covenants and the like in connection with Developer's activities on the Property or regarding the Project. (f) The implementation and enforcement by Developer, its agents or contractors of any monitoring, notification or other precautionary measures that may, at any time, become necessary to protect against the release, potential release or discharge of Hazardous Substances on, in, under, from or affecting the Property or the Project. (g) The failure of Developer, its agents or contractors, in compliance with all applicable Environmental Laws, to lawfully remove, contain, transport or dispose of any Hazardous Substances existing, stored or generated on, in, under or from the Property or the Project. (h) Any investigation, inquiry, order, hearing, action or other proceeding by or before any Governmental Agency in connection with any Hazardous Substances on, in, under, from or affecting the Property or the Project or the violation of any Environmental Law relating to the Property or the Project. On and after the Escrow Closing Date, Developer shall pay to City all costs and expenses including, without limitation, reasonable attorney's fees and costs, incurred by City in connection with enforcement of the aforementioned environmental indemnity. Section 5.11 Insurance. On and after the Escrow Closing Date, Developer, to protect City, and City Personnel against any and all claims and liability for death, injury, 882/012782-0020 4927006I01/20 -32- March 19, 2019 Item #3.1 Resolution No. 19-013 loss and damage resulting from Developer's actions in connection with this Agreement, the Property and the Project, shall secure and maintain the insurance coverage, described in and required by this Section 5.11. Developer shall pay any deductibles and self -insured retentions under all insurance policies issued in satisfaction of the terms of this Agreement. (a) Workers' Compensation Insurance Requirement. On and after the Escrow Closing Date, Developer shall submit written proof, if Developer has employees, that Developer is insured against liability for workers' compensation in accordance with the provisions of Section 3700 of the Labor Code. By executing this Agreement, Developer makes the following certification, required by Section 1861 of the Labor Code: "I am aware of the provisions of section 3700 of the Labor Code which require every employer to be insured against liability for workers' compensation or to undertake self- insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of the Agreement." (1) On and after the Escrow Closing Date, Developer shall require each contractor and sub -contractor performing work on the Project or the Property to provide workers' compensation coverage for all of such contractor's or sub -contractor's employees, unless the contractor's or sub -contractor's employees are covered by workers' compensation insurance provided by Developer. If any class of employees engaged in work or services performed in connection with the Project is not covered by Labor Code Section 3700, Developer shall provide and/or require each contractor or sub- contractor to provide adequate workers' compensation insurance covering such employees. (b) Liability and Permanent Insurance Requirements. (1) On and after the Escrow Closing Date, Developer shall maintain in full force and effect, until the Project Completion Date, subject to subsection (e), the following insurance coverage: Commercial General Liability Insurance coverage, including, but not limited to, Premises -Operations, Contractual Liability Insurance (specifically covering the indemnity obligations of Developer pursuant to this Agreement), Products -Completed Operations Hazards, Personal Injury (including bodily injury and death), and Property Damage for liability arising out of the construction of the Project and/or the Developer's operation of the Property or the Project. (i) Commercial general liability insurance coverage shall have minimum limits for Bodily Injury and Property Damage liability of FIVE MILLION 882/012782-0020 4927006/01I20 -33- March 19, 2019 Item #3.1 Resolution No. 19-013 DOLLARS ($5,000,000) each occurrence and TEN MILLION DOLLARS ($10,000,000) aggregate. (ii) Automobile Liability Insurance against claims of Personal Injury (including bodily injury and death) and Property Damage covering all owned, leased, hired and non -owned vehicles used by Developer with minimum limits for Bodily Injury and Property Damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate. Such insurance shall be provided by a business or commercial vehicle policy. (iii) If Developer hires a consultant to provide design services, such as architectural or engineering services in connection with the Project, or any portion of the Project, Developer shall require each such consultant to provide Professional Liability (Errors and Omissions) Insurance, for liability arising out of, or in connection with, the performance of such design services, with limits of not less than ONE MILLION DOLLARS ($1,000,000). (c) On and after the Escrow Closing Date, Developer shall require that each contractor performing work on the Project maintain the following insurance coverage, as specified below: (1) Each General Contractor shall maintain Builder's Risk Insurance to be written on an All Risk Completed Value form, in an aggregate amount equal to 100% of the completed insurable value of the Project. (2) Each General Contractor and each sub -contractor shall maintain Commercial General Liability Insurance with limits of not less than FIVE MILLION DOLLARS ($5,000,000) per occurrence and TEN MILLION DOLLARS ($10,000,000) aggregate to protect the Developer during the construction of the Project from claims involving bodily injury and/or death and damage to the property of others. (3) Each General Contractor and each sub -contractor shall maintain Automobile Liability Insurance against claims of personal injury (including bodily injury and death) and property damage covering all owned, leased, hired and non -owned vehicles used in the performance of the contractor's obligations with minimum limits for bodily injury and property damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate. Such insurance shall be provided by a business or commercial vehicle policy. (d) The Commercial General Liability Insurance required in subsection (b)(1)(i) above, shall include an endorsement naming City and City Personnel as additional insureds for liability arising out of this Agreement and any operation related to this Agreement. (e) If any of the insurance coverage required under this Agreement is written on a claims -made basis, such insurance policy shall provide an extended reporting period continuing through the fifth (5th) anniversary of the Project Completion Date. The requirements of this subsection (e) shall survive any expiration or termination of this 882/012782-0020 41)98fig6to1/20 -34- March 19, 2019 Item #3.1 Resolution No. 19-013 Agreement and the recordation of the City Grant Deed and City's issuance of the Release of Construction Covenants for the Project. (f) Receipt by City of evidence of insurance that does not comply with the above requirements shall not constitute a waiver of the insurance requirements of this Agreement. (g) Subject to subsection (e), the above required insurance coverage shall be maintained by Developer or its contractors, as required by the terms of this Agreement, shall not be reduced, modified, or canceled without, at least, thirty (30) days prior written notice to City. Also, phrases such as "endeavor to" and "but failure to mail such notice shall impose no obligation or liability of any kind upon the company" shall not be included in the cancellation wording of any Certificates of Insurance or any coverage for City and City Personnel. Developer shall immediately obtain replacement coverage for any insurance policy that is terminated, canceled, non -renewed, or whose policy limits are exhausted or upon insolvency of the insurer that issued the policy. (h) All insurance to be obtained and maintained by Developer under this Agreement shall be issued by a company or companies listed in the then current "Best's Key Rating Guide" publication with a minimum of an "A; IX" rating and be admitted to business in the State of California by the State of California Department of Insurance. (i) City will not accept self-insurance in satisfaction of the insurance requirements of this Section 5.11. (j) All insurance obtained and maintained by Developer in satisfaction of the requirements of this Agreement shall be primary to and not contributing to any insurance maintained by any of City and City Personnel. (k) Insurance coverage in the minimum amounts set forth in this Agreement shall not be construed to relieve Developer of any liability, whether within, outside, or in excess of such coverage, and regardless of solvency or insolvency of the insurer that issues the coverage; nor shall it preclude City from taking such other actions as are available to it under any other provision of this Agreement or otherwise at law. (I) Failure by Developer to maintain all insurance required by this Agreement in effect at all times shall be an Event of Default by Developer. City, at its sole option, may exercise any remedy available to it in connection with such an Event of Default. Additionally, City may purchase such required insurance coverage and City shall be entitled to immediate payment from Developer for any premiums and associated costs paid by City for such insurance coverage. Any election by City to purchase or not to purchase insurance for Developer shall not relieve Developer of its obligation to obtain and maintain the insurance coverage required by this Agreement. Section 5.12 Developer CC&Rs. Prior to City's issuance of a final certificate of occupancy for any of individual residential dwelling units in the Residential Development, Developer shall have submitted to City, obtained City's approval of (such approval not to be unreasonably withheld, conditioned or delayed), and recorded against the underlying 882/012782-0020 4igigwo1/20 -35- March 19, 2019 Item #3.1 Resolution No. 19-013 real property a declaration of covenants, conditions, and restrictions that (i) establishes a homeowners' association, (ii) is necessary to create a condominium regime for the condominiums described on the condominium plan to be recorded in accordance with all applicable laws (for any portion of the Residential Development developed with condominium -style units); and (iii) clearly sets forth the maintenance obligations of the owners of the residential dwelling units (the "Developer CC&Rs"). The Developer CC&Rs shall provide that the City is a third party beneficiary thereof with the right, but not the obligation, to enforce the terms thereof which are required by this Section 5.12 (the "City Required Provisions"), and shall require that (a) any proposed amendments to the Developer CC&Rs that would amend any of the City Required Provisions must be provided to City, (b) City shall have the right, in City's reasonable discretion, to provide a written objection to any such proposed amendment, within thirty (30) days after City's receipt of the proposed amendment, and (c) if no objection is provided by City within such thirty (30) day period, the proposed amendment may be approved. Section 5.13 Release of Construction Covenants. (a) Following the completion of the Residential Development or Retail Development (either of the foregoing, a "Project Component"), excluding any normal and minor building "punch -list" items to be completed by Developer, and upon written request from Developer for issuance of a Release of Construction Covenants, City shall inspect the Project Component to determine whether or not the Project Component has been completed in substantial conformance with this Agreement. If City determines that the Project Component is complete and in substantial conformance with this Agreement, which determination shall not be unreasonably withheld, City shall furnish Developer with a Release of Construction Covenants for the Project Component. If City determines that the Project Component is not in substantial conformance with this Agreement, City shall send written notice of each non -conformity to Developer, pursuant to Section 5.13(c). (b) A Release of Construction Covenants shall be evidence of City's conclusive determination of satisfactory completion of the Project Component pursuant to the terms of this Agreement. After the recordation of a Release of Construction Covenants for the Project Component, any person then owning or thereafter purchasing, leasing or otherwise acquiring any interest in the portion of the Property improved with the Project Component shall not (because of such ownership, purchase, lease or acquisition) incur any obligation or liability under this Agreement regarding construction of the Project Component, except that such person shall be bound by any reservations, covenants, conditions, restrictions and other interests affecting the such portion of the Property pursuant to this Agreement. (c) If City in its reasonable discretion fails or refuses to issue a Release of Construction Covenants for a Project Component, following a written request from Developer, City shall, within fifteen (15) calendar days following City's receipt of Developer's written request or within three (3) calendar days after the next regular meeting of the City Council, whichever date occurs later, provide Developer with a written statement setting forth in reasonable detail the reasons for City's failure or refusal to issue a Release of Construction Covenants. The statement shall also contain City's opinion of 882/012782-0020 4927006IO1/20 -36- March 19, 2019 Item #3.1 Resolution No. 19-013 the action(s) Developer must take to obtain a Release of Construction Covenants from City. If the reason for Developer's failure to complete the Project Component is confined to the immediate unavailability of specific items or materials for construction or landscaping at a price reasonably acceptable to Developer or other minor building "punch -list" items, City may issue its Release of Construction Covenants upon the posting of a bond or irrevocable standby letter of credit by Developer in a form reasonably acceptable to City in an amount representing the fair value of the work on the Project Component remaining to be completed, as reasonably determined by City. If City fails to provide such written statement, within the specified time period, Developer shall be deemed, conclusively and without further action of City, to have satisfied the requirements of this Agreement with respect to the Project Component, as if a Release of Construction Covenants had been issued by City pursuant to this Agreement. (d) A Release of Construction Covenants shall not be deemed to constitute a Notice of Completion under Section 3093 of the California Civil Code, nor shall it act to terminate the continuing covenants, restrictions or conditions contained in the City Grant Deed or any other instruments recorded against the Property or set forth in this Agreement or otherwise. A Release of Construction Covenants is not evidence of the compliance of the Project Component with any Governmental Requirements. A Release of Construction Covenants shall not evidence the satisfaction of any obligation of Developer to City under this Agreement or otherwise, except Developer's obligation to construct the Project Component. (e) Notwithstanding anything in this Section 5.13 to the contrary, at such time as Developer has completed construction of a residential dwelling unit comprising a portion of the Residential Development, as evidenced by City's issuance of a certificate of occupancy for said dwelling unit, City agrees to execute a document in a form reasonably acceptable to the Title Company terminating the Memorandum of Agreement with respect to such dwelling unit. Section 5.14 Comprehensive Retail Development; Phasing. Developer represents to City that as of the Effective Date, Developer has negotiated in good faith with the owners of various properties adjacent to the Retail Parcels to acquire those parcels on commercially reasonable terms. During the term of this Agreement, Developer shall continue to diligently pursue acquisition of suitable real properties, and attempt to plan and design a Comprehensive Retail Development. Commencing on the first day of the first calendar quarter following the Effective Date, Developer shall provide written updates to the City Manager, on a quarterly basis, describing in reasonable detail Developer's efforts during the immediately preceding quarter with respect to planning and designing a Comprehensive Retail Development, and the outcome of such efforts. (a) The Parties acknowledge and agree that the "Project" as defined in this Agreement contemplates that Developer will fully develop the Comprehensive Retail Development. Upon the Close of Escrow, Developer shall commence, and diligently proceed to completion, the "Phase 1 Retail Development Work," as described in the Scope of Development. If Developer is unable to plan and design a Comprehensive Retail Development within two (2) years following the Effective Date, Developer and City 882/012782-0020 gd98ioig6/o1/20 -37- March 19, 2019 Item #3.1 Resolution No. 19-013 shall meet and confer regarding an appropriate alternative development as the Comprehensive Retail Development (an "Alternative Development"). If by the third (3rd) anniversary of the Effective Date (the "Third Anniversary"), Developer has not been able to plan and design a Comprehensive Retail Development, and the Parties have not agreed on an appropriate Alternative Development, then City shall have a right to purchase the Retail Parcels from Developer ("City's Retail Parcels Purchase Right") for the greater of (i) the outstanding amount owed on the City Note, or (ii) eighty percent (80%) of the appraised value of the Retail Parcels as of that date (the "Retail Parcels Purchase Price"). City shall exercise City's Retail Parcels Purchase Right by providing a written notice to Developer, within sixty (60) days after the Third Anniversary, stating City's intention to exercise City's Retail Parcels Purchase Right, and purchase the Retail Parcels ("City's Notice of Exercise"). The appraised value of the Retail Parcels shall be determined by an appraisal conducted by an MAI appraiser selected by City and reasonably acceptable to Developer. At such time as the Parties receive the appraisal, City shall have the right to terminate its prior election to exercise City's Retail Parcels Purchase Right ("City's Right of Termination"). City shall exercise City's Right of Termination by providing a written notice to Developer, within thirty (30) days after the Parties receive the appraisal. Notwithstanding anything in this Section 5.14 to the contrary, the following shall apply if City elects to not exercise City's Retail Parcels Purchase Right: If at any time within the three (3) year period after such election by City Developer desires to develop the Retail Parcels with a residential development or sell the Retail Parcels, as a condition to either of such action, Developer shall be required to pay to City fifty percent (50%) of the difference between (a) the appraised value of the Retail Parcels for residential use, determined by an appraisal conducted by an MAI appraiser selected by City and reasonably acceptable to Developer, and (b) One Million Seven Hundred Thousand Dollars ($1,700,000), which is the portion of the Purchase Price attributable to the Retail Parcels. (b) The provisions of this subparagraph (b) shall apply in the event City exercises City's Retail Parcels Purchase Right, and does not exercise City's Right of Termination. The provisions of this subparagraph (b) shall also apply in the event City exercises its right of first refusal pursuant to Section 10.6 below, except to the extent the provisions in this subparagraph (b) conflict with the Acceptable Terms or Acceptable Offer (as applicable), as reasonably determined by the City Manager, in which case the conflicting provisions of the Acceptable Terms or Acceptable Offer (as applicable) shall control. (1) Within thirty (30) business days after City exercises City's Retail Parcels Purchase Right, Developer and City shall cause an escrow ("City's Repurchase Escrow") to be opened with the Escrow Holder for the conveyance of the Retail Parcels by Developer to City. City's Repurchase Escrow shall be deemed opened on the date City delivers to Escrow Holder (a) a copy of this Section 5.14, and (b) a copy of City's Notice of Exercise, accompanied by a written certification from City that City has not exercised City's Right of Termination ("Opening of City's Repurchase Escrow"). Escrow Holder shall notify Developer and City in writing of the date of the Opening of City's Repurchase Escrow promptly following the opening of City's Repurchase Escrow. 882/012782-0020 .13,09O27,.016/01 /20 -38- March 19, 2019 Item #3.1 Resolution No. 19-013 (2) City's Repurchase Escrow shall close on or before the date that is sixty (60) days after the Opening of City's Repurchase Escrow ("City's Repurchase Escrow Closing Date"). The terms "Close of City's Repurchase Escrow" and/or the "City's Repurchase Escrow Closing" shall mean the date the "City's Repurchase Grant Deed" (as that term is defined in paragraph (6) below) conveying fee title to the Retail Parcels to City is recorded in the Office of the County Recorder of San Diego County, California. Possession of the Retail Parcels shall be delivered to City at the Close of City's Repurchase Escrow free and clear of all tenancies, lessees, occupants, and all possessory rights of any kind or nature. (3) This Section 5.14, together with any standard instructions of Escrow Holder, shall constitute the joint escrow instructions of Developer and City to Escrow Holder as well as an agreement between Developer and City with respect to Developer's conveyance to City of the Retail Parcels. In the event of any conflict between the provisions of this Section 5.14 and Escrow Holder's standard instructions, this Section 5.14 shall prevail. (4) Developer shall convey and City shall accept fee simple title to the Retail Parcels free and clear of all recorded and unrecorded monetary liens, encumbrances, easements, leases, covenants, conditions, restrictions, and other exceptions to or defects in title, excepting only the following: (a) the title exceptions listed in City's Title Policy with respect to the Retail Parcels; (b) current taxes not yet delinquent; (c) the lien of any construction loan obtained by Developer for construction of the Project that has been approved by City; and (d) those additional title exceptions as may be approved in writing by City in its sole and absolute discretion. (5) Developer shall be responsible for all of the escrow fees, recording fees, documentary transfer taxes, and any other costs and expenses of escrow, and any property taxes and assessments and all costs required to place title in the condition described in paragraph (4) above. Concurrently with the conveyance of the Retail Parcels to City, and as a condition to City's acceptance of said conveyance, Developer shall cause the Title Company to deliver to City an ALTA standard owner's policy of title insurance showing title vested in City in the condition described in paragraph (4) above with insurance coverage in the amount of the Retail Parcels Purchase Price ("City's Repurchase Title Policy"). Developer shall pay the premium for the City's Repurchase Title Policy. City shall pay for any additional coverage or endorsements to the City's Repurchase Title Policy. (6) On or before 1:00 p.m. on the last business day preceding the scheduled City's Repurchase Escrow Closing Date, City shall deposit or cause to be deposited with Escrow Holder the following: the Retail Parcels Purchase Price, and any and all additional instruments or other documents required from City (executed and acknowledged if appropriate) as may be necessary in order to effect the transfer of the Retail Parcels to City. On or before 1:00 p.m. on the last business day preceding the scheduled City's Repurchase Escrow Closing Date, Developer shall deposit or cause to be deposited with Escrow Holder the following: (a) an executed and acknowledged grant deed conveying the Retail Parcels to City substantially in the form of the City Grant Deed 882/012782-0020 gigit36/01 /20 -39- March 19, 2019 Item #3.1 Resolution No. 19-013 ("Retail Parcels Grant Deed"); (b) all escrow fees and closing costs; and (c) any and all additional funds, instruments, or other documents required from Developer (executed and acknowledged if appropriate), as may be necessary in order to effect the transfer of the Retail Parcels to City. (7) On or before the City's Repurchase Escrow Closing Date, and when Escrow Holder has received all of the documents and funds listed in paragraph (6) above, and Escrow Holder is in a position to cause the City's Repurchase Title Policy referred to in paragraph (5) above to be issued to City, and provided City has approved the physical condition of the Retail Parcels, Escrow Holder shall close the City's Repurchase Escrow by (i) recording the Retail Parcels Grant Deed in the Office of the Official Records of San Diego County, California, (ii) delivering the recorded Retail Parcels Grant Deed to City, (iii) causing the City's Repurchase Title Policy to be issued to City, and (iv) delivering the Retail Parcels Purchase Price to Developer. Section 5.15 City Option to Repurchase Residential Parcels. (a) Grant of Option., Developer hereby grants to City an option to repurchase all or any portion of the Residential Parcels not yet then completed, as evidenced by City's issuance of a certificate of occupancy ("Residential Parcels Repurchase Option") on the terms set forth in this Section 5.15. The term of the Residential Parcels Repurchase Option shall commence on the Close of Escrow and shall extend to the Project Completion Date (the "Residential Parcels Repurchase Option Period"). City's rights under the Residential Parcels Repurchase Option are in addition to and are not limited by the City's Retail Parcels Purchase Right granted to City pursuant to Section 5.14 above. (b) Conditions to Exercise of Repurchase Option. City shall be entitled to exercise the Residential Parcels Repurchase Option during the Residential Parcels Repurchase Option Period in the event of the occurrence of any of the following events (any such event, a "Residential Parcels Repurchase Option Event"): (1) Developer's failure to commence vertical construction of the First Phase of the Residential Development on the Residential Parcels within the time frame therefor set forth in the Schedule of Performance, subject to the notice and right to cure provisions set forth in Section 9.2(a) below, unless such failure is a result of an "Adverse Market Condition" (as that term is defined below) or Unavoidable Delay. (2) Developer's failure to diligently and continuously develop the Residential Parcels and construct, complete and market residential units within the Residential Parcels. Without limitation of the following, any period of inactivity in actually conducting material construction work on the Residential Development within the Residential Parcels until completion for more than forty five (45) days, subject to the notice and right to cure provisions set forth in Section 9.2(a) below, unless such delays are caused by an Adverse Market Condition or Unavoidable Delay. 882/012782-0020 gy96foig6/o1/20 -40- March 19, 2019 Item #3.1 Resolution No. 19-013 As used in this Section 5.15, the term "Adverse Market Condition" shall mean and refer to adverse changes in economic conditions of the market for new homes in general or in the City of Poway in particular. In the event of an Adverse Market Condition that results in the occurrence of one of the failures described in paragraph (1) or (2) above, Developer shall provide reasonable evidence thereof to City. (c) Exercise of Residential Parcels Repurchase Option. City may, but shall not be obligated to, exercise its Residential Parcels Repurchase Option following the occurrence of any Residential Parcels Repurchase Option Event (but in no event later than six (6) months following the occurrence of such Residential Parcels Repurchase Option Event), City shall do so by delivery of written notice ("Residential Parcels Repurchase Option Notice") thereof to Developer. (d) Residential Parcels Repurchase Price. The price at which City shall be entitled to repurchase the Residential Parcels ("Residential Parcels Repurchase Price") shall be the lesser of (a) ninety percent (90%) of the appraised value of the Residential Parcels or portion thereof which City is entitled, and elects, to purchase or (b) the sum of (i) the "Base Price" plus (ii) the "Design and Hard Construction Costs" (as those terms are defined below), if any, actually paid by Developer with respect to the construction of improvements on the Residential Parcels or portion thereof which City is entitled, and elects, to purchase, provided such Design and Hard Construction Costs have been verified to City's reasonable satisfaction. Developer will present City with paid invoices or other reasonable evidence to support the calculation of such costs. For the purpose of this Section 5.15, the following defined terms shall have the following meanings: (i) "Base Price" means the applicable portion of Purchase Price paid by Developer to City and to private parties for the acquisition of the Residential Parcels or portion thereof which City is entitled, and elects, to purchase, and (ii) "Design and Hard Construction Costs" means actual out of pocket construction costs paid by Developer to any contractor (including but not limited to the Contractor) or subcontractor for construction costs and materials and inspection, payments made to consultants, architects, engineers, or other design professionals, and building permit and similar fees actually paid by Developer to City or other governmental agency for the construction of the Residential Development or portion thereof which City is entitled, and elects, to purchase. Design and Hard Construction Costs specifically exclude, without limitation, (1) salaries and other charges for office personnel, (2) office expenses, (3) overhead and general expense of any kind, (4) interest or return on capital, financing costs or expenses, or depreciation, (5) insurance expenses, (6) sales and marketing expenses, (7) legal and accounting fees and expenses, (8) taxes or assessments of any kind, or (9) any costs or expenses attributable to the negligence or misconduct of Developer of its employees, agents, or contractors. (e) The appraised value of the Residential Parcels or portion thereof which City is entitled, and elects, to purchase, shall be determined by an appraisal conducted by an MAI appraiser selected by City and reasonably acceptable to 882/012782-0020 b4 O2 T ;51 6/01 /20 -41- March 19, 2019 Item #3.1 Resolution No. 19-013 Developer. At such time as the Parties receive the appraisal, City shall have the right to terminate its prior election to exercise City's Residential Parcels Repurchase Option ("City's Residential Parcels Repurchase Option Right of Termination"). City shall exercise City's Residential Parcels Repurchase Option Right of Termination by providing a written notice to Developer, within thirty (30) days after the Parties receive the appraisal. In the event City does not timely deliver its Residential Parcels Repurchase Option Notice or in the event the City delivers the City's Residential Parcels Repurchase Option Right of Termination, then the City's Residential Parcels Repurchase Option shall be deemed terminated and of no further force or effect. (f) The provisions of this subparagraph (f) shall apply in the event City timely delivers its Residential Parcels Repurchase Option Notice and does not exercise City's Residential Parcels Repurchase Right of Termination. The provisions of this subparagraph (f) shall also apply in the event City exercises its right of first refusal pursuant to Section 10.6 below, except to the extent the provisions in this subparagraph (f) conflict with the Acceptable Terms or Acceptable Offer (as applicable), as reasonably determined by the City Manager, in which case the conflicting provisions of the Acceptable Terms or Acceptable Offer (as applicable) shall control. (1) Within thirty (30) days after receipt of the appraisal, Developer and City shall cause an escrow ("City's Residential Parcels Repurchase Escrow") to be opened with the Escrow Holder for the conveyance of the Residential Parcels or portion thereof which City has the right, and elects, to purchase, by Developer to City. City's Residential Parcels Repurchase Escrow shall be deemed opened on the date City delivers to Escrow Holder (a) a copy of this Section 5.15, and (b) a copy of City's Notice of Exercise, accompanied by a written certification from City that City has not exercised City's Right of Termination ("Opening of City's Residential Parcels Repurchase Escrow"). Escrow Holder shall notify Developer and City in writing of the date of the Opening of City's Residential Parcels Repurchase Escrow promptly following the opening of City's Residential Parcels Repurchase Escrow. (2) City's Residential Parcels Repurchase Escrow shall close on or before the date that is sixty (60) days after the Opening of City's Residential Parcels Repurchase Escrow ("City's Residential Parcels Repurchase Escrow Closing Date"). The terms "Close of City's Residential Parcels Repurchase Escrow" and/or the "City's Residential Parcels Repurchase Escrow Closing" shall mean the date the "City's Residential Parcels Repurchase Grant Deed" (as that term is defined in paragraph (6) below) conveying fee title to the Residential Parcels or portion thereof which City has the right, and elects, to purchase, to City is recorded in the Office of the County Recorder of San Diego County, California. Possession of the Residential Parcels or portion thereof which City has the right, and elects, to purchase, shall be delivered to City at the Close of City's Residential Parcels Repurchase Escrow free and clear of all tenancies, lessees, occupants, and all possessory rights of any kind or nature. (3) This Section 5.15, together with any standard instructions of Escrow Holder, shall constitute the joint escrow instructions of Developer and City to Escrow Holder as well as an agreement between Developer and City with respect to 882/012782-0020 gg98fois6to1/20 -42- March 19, 2019 Item #3.1 Resolution No. 19-013 Developer's conveyance to City of the Residential Parcels or portion thereof which City has the right, and elects, to purchase. In the event of any conflict between the provisions of this Section 5.15 and Escrow Holder's standard instructions, this Section 5.15 shall prevail. (4) Developer shall convey and City shall accept fee simple title to the Residential Parcels or portion thereof which City has the right, and elects, to purchase, free and clear of all recorded and unrecorded monetary liens, encumbrances, easements, leases, covenants, conditions, restrictions, and other exceptions to or defects in title, excepting only the following: (a) the title exceptions listed in Developer's Title Policy with respect to the Residential Parcels; (b) current taxes not yet delinquent; (c) the lien of any construction loan obtained by Developer for construction of the Project that has been approved by City; and (d) those additional title exceptions as may be approved in writing by City in its sole and absolute discretion. (5) Developer shall be responsible for all of the escrow fees, recording fees, documentary transfer taxes, and any other costs and expenses of escrow, and any property taxes and assessments and all costs required to place title in the condition described in paragraph (4) above. Concurrently with the conveyance of the Residential Parcels or portion thereof which City has the right, and elects, to purchase, to City, and as a condition to City's acceptance of said conveyance, Developer shall cause the Title Company to deliver to City an ALTA standard owner's policy of title insurance showing title vested in City in the condition described in paragraph (4) above with insurance coverage in the amount of the Residential Parcels Repurchase Price ("City's Residential Parcels Repurchase Title Policy"). Developer shall pay the premium for the City's Residential Parcels Repurchase Title Policy. City shall pay for any additional coverage or endorsements to the City's Residential Parcels Repurchase Title Policy. (6) On or before 1:00 p.m. on the last business day preceding the scheduled City's Residential Parcels Repurchase Escrow Closing Date, City shall deposit or cause to be deposited with Escrow Holder the following: the Residential Parcels Repurchase Price, and any and all additional instruments or other documents required from City (executed and acknowledged if appropriate) as may be necessary in order to effect the transfer of the Residential Parcels or portion thereof that City has the right, and elects, to purchase, to City. On or before 1:00 p.m. on the last business day preceding the scheduled City's Residential Parcels Repurchase Escrow Closing Date, Developer shall deposit or cause to be deposited with Escrow Holder the following: (a) an executed and acknowledged grant deed conveying the Residential Parcels or portion thereof which City has the right, and elects, to purchase, to City substantially in the form of the City Grant Deed ("Residential Parcels Repurchase Grant Deed"); (b) all escrow fees and closing costs; and (c) any and all additional funds, instruments, or other documents required from Developer (executed and acknowledged if appropriate), as may be necessary in order to effect the transfer of the Residential Parcels or portion thereof which City has a right, and elects, to purchase, to City. (7) On or before the City's Residential Parcels Repurchase Escrow Closing Date, and when Escrow Holder has received all of the documents and 882/012782-0020 gg98foig6/o1/20 -43- March 19, 2019 Item #3.1 Resolution No. 19-013 funds listed in paragraph (6) above, and Escrow Holder is in a position to cause the City's Residential Parcels Repurchase Title Policy referred to in paragraph (5) above to be issued to City, and provided City has approved the physical condition of the Residential Parcels or portion thereof which City has the right, and elects, to purchase, Escrow Holder shall close the City's Residential Parcels Repurchase Escrow by (i) recording the Residential Parcels Repurchase Grant Deed in the Office of the Official Records of San Diego County, California, (ii) delivering the recorded Residential Parcels Repurchase Grant Deed to City, (iii) causing the City's Repurchase Parcels Title Policy to be issued to City, and (iv) delivering the Residential Parcels Repurchase Price to Developer. ARTICLE VI USE AND OPERATION OF THE PROJECT Section 6.1 Encumbrances and Liens. Developer shall not record and shall not allow to be recorded against the Property or any portion of the Property any mortgage, trust deed, deed of trust, encumbrance or lien not expressly authorized by this Agreement. Developer shall remove, or shall have removed, any unauthorized lien, encumbrance, mortgage, levy or attachment made or recorded against the Property or any portion of the Property, or shall assure the satisfaction thereof to the satisfaction of City. The covenants of Developer set forth in this Section 6.2 regarding the placement of any unauthorized mortgage, trust deed, deed of trust, encumbrance or lien on the Property shall only remain in effect until the Project Completion Date. Section 6.2 Nondiscrimination. In addition to any other nondiscrimination provisions applicable to the Property under federal, state or local law, 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 any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, or any part thereof, nor shall Developer, 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 Property, or any part thereof. The foregoing covenants shall run with the land. Developer agrees for itself and any successor in interest that Developer shall refrain from restricting the rental, sale, or lease of any portion of the Property, or contracts relating to the Property, on the basis of race, color, creed, religion, sex, marital status, ancestry, or national origin 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 882/012782-0020 gy9gig6/01/20 -44- March 19, 2019 Item #3.1 Resolution No. 19-013 person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any 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 premises 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: "That there shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, 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. The foregoing covenants shall run with the land" 3. In contracts: "There shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises which are the subject of this agreement, nor shall the grantee or any person claiming under or through him or her, establish or permit any 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 premises herein conveyed. The foregoing covenants shall run with the land." Section 6.3 Effect of Covenants. The covenants established in this Agreement shall, without regard to technical classification and designation, be binding for the benefit and in favor of City and City's successors and assigns, and any successor in interest to the Property, together with any property acquired by Developer pursuant to this Agreement, or any part thereof. The covenants against discrimination shall remain in effect in perpetuity. Section 6.4 Taxes and Assessments. Developer shall pay prior to delinquency all real estate taxes and assessments on the Property, so long as Developer retains any ownership interest therein. Developer shall remove or have removed any levy or 882/012782-0020 gifylig6/01/20 -45- March 19, 2019 Item #3.1 Resolution No. 19-013 attachment made on the Property or any part thereof, or assure the satisfaction thereof within a reasonable time but in any event prior to any sale or transfer of all or any portions thereof. Notwithstanding the above, Developer shall have the right to contest the validity or amounts of any tax, assessment, or encumbrance available to Developer in respect thereto, and nothing herein shall limit the remedies available to Developer in respect thereto. Section 6.5 Developer Covenant to Defend this Agreement. Developer acknowledges that City is a "public entity" and/or a "public agency" as defined under applicable California law. Therefore, City must satisfy the requirements of certain California statutes relating to the actions of public entities, including, without limitation, CEQA. Also, as a California municipal corporation, City's action in approving this Agreement may be subject to proceedings to invalidate this Agreement or mandamus. Developer assumes the risk of delays and damages that may result to Developer from any third -party legal actions related to City's approval of this Agreement or the pursuit of the activities contemplated by this Agreement, including, without limitation, City's approval of any Project approvals and issuance of any permits required for development of the Project, even in the event that an error, omission or abuse of discretion by City is determined to have occurred. If a third -party files a legal action regarding City's approval of this Agreement or the pursuit of the activities contemplated by this Agreement, including, without limitation, City's approval of any Project approvals and issuance of any permits required for development of the Project, City may terminate this Agreement on thirty (30) days written notice to Developer of City's intent to terminate this Agreement, referencing this Section 6.6, without any further obligation to perform the terms of this Agreement and without any liability to Developer resulting from such termination, unless Developer unconditionally agrees to indemnify and defend City and City Personnel, with legal counsel acceptable to City, against such third -party legal action, as provided hereinafter in this Section 6.6 Within 30 days of receipt of City's notice of intent to terminate this Agreement, as provided in the preceding sentence, Developer may in Developer's sole and absolute discretion offer to defend City, with legal counsel acceptable to City, in the third -party legal action and pay all of the court costs, attorney fees, monetary awards, sanctions, attorney fee awards, expert witness and consulting fees, and the expenses of any and all financial or performance obligations resulting from the disposition of the legal action. At the request of Developer, City shall cooperate with and assist Developer in its defense of any such third -party legal action, provided that City shall not be obligated to incur any expense in connection with such cooperation or assistance. ARTICLE VII RIGHTS OF HOLDERS OF APPROVED SECURITY INTERESTS IN PROPERTY Notwithstanding anything to the contrary in this Agreement, the provisions in this Article VII shall automatically terminate upon City's issuance of a Release of Construction Covenants for the Project. 882/012782-0020 gg gi g6/01 /20 -46- March 19, 2019 Item #3.1 Resolution No. 19-013 Section 7.1 No Encumbrances Except Mortgages, Deeds of Trust, or Sale and Lease -Back for Development. Mortgages, deeds of trust, and sales and leases -back or any other method of financing shall be permitted before the completion of the Project only for the purpose of securing loans of funds to be used for financing the construction of the Project, if necessary, and only if such loans are provided by an Institutional Lender or other acceptable person or entity reasonably acceptable to City, on commercially reasonable terms. Developer shall notify City in advance of any mortgage, deed of trust, sale and lease -back or other form of conveyance for financing if Developer proposes to enter into the same. Any such form of conveyance (i) shall only encumber the Residential Parcels, and (ii) may be in a first -priority lien position. Any such construction loan may include terms that convert the loan to a term loan upon completion of construction of the Project. Developer shall not enter into any such conveyance that will encumber the Retail Parcels without the prior written approval of City, which approval City may withhold in its sole and absolute discretion. Section 7.2 Holder Not Obligated to Construct Project. 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, repair, or complete the Project or any portion thereof, or to guarantee such construction or completion; nor shall any covenant or any other provision in this Agreement 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 Property to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. Section 7.3 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 City may deliver any notice or demand to Developer with respect to any breach or default by Developer in completion of construction of the Project, City shall at the same time deliver a copy of such notice or demand to each holder of record of any mortgage or deed of trust authorized by this Agreement who has previously requested such notice in writing. Each such holder shall (insofar as the rights granted by City are concerned) have the right, at its option, but not the obligation, within thirty (30) days after the receipt of the notice, to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the Project, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed Developer's obligations to City by written agreement satisfactory to City. 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. Any such holder properly completing such improvement shall be entitled, upon compliance with the requirements of this Section 7.3, to a Release of Construction Covenants. It is understood that a holder shall be deemed to have satisfied the thirty (30) day time limit set forth above for commencing to cure or remedy a Developer default which requires title and/or possession of the Property (or portion of this Agreement) if and to the extent any such holder has within such thirty (30) day period commenced 882/012782-0020 d898ioig6/o1/20 -47- March 19, 2019 Item #3.1 Resolution No. 19-013 proceedings to obtain title and/or possession and thereafter the holder diligently pursues such proceedings to completion and cures or remedies the default. Section 7.4 Right of City to Cure Mortgage or Deed of Trust Default. In the event of a mortgage or deed of trust default or breach by Developer prior to the completion of construction of the Project or any part of this Agreement, Developer shall immediately deliver to City a copy of any mortgage holder's notice of default. If the holder of any mortgage or deed of trust has not exercised its option to construct, City shall have the right but no obligation to cure the default. In such event, City shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by City in curing such default. City shall also be entitled to a lien upon the Property to the extent of such costs and disbursements. Any such lien shall be junior and subordinate to the mortgages or deeds of trust permitted pursuant to Section 7.1. Section 7.5 Right of City to Satisfy Other Liens on the Property. After the Close of Escrow and prior to the completion of construction, and after Developer has had written notice and has failed, after a reasonable time, to challenge, cure, or satisfy any other liens or encumbrances on the Property, City shall have the right but no obligation to satisfy any such other liens or encumbrances. ARTICLE VIII REPRESENTATIONS AND WARRANTIES OF DEVELOPER Section 8.1 Representations and Warranties by Developer. Developer makes the following representations, covenants and warranties, which shall be deemed to have been given on the Effective Date and on each date thereafter until the Project Completion Date, and acknowledges that the execution of this Agreement by City is made in material reliance by City on such covenants, representations and warranties of Developer: (a) Developer has taken all requisite action and obtained all requisite consents in connection with entering into this Agreement, such that this Agreement is valid and enforceable against Developer in accordance with its terms and each instrument to be executed by Developer pursuant to or in connection with this Agreement will, when executed, be valid and enforceable against Developer in accordance with its terms. No approval, consent, order or authorization of, or designation or declaration of any other person, is required in connection with the valid execution, delivery or performance of this Agreement by Developer. (b) If Developer becomes aware of any act or circumstance that would change or render incorrect, in whole or in part, any representation or warranty made by Developer under this Agreement, whether as of the date given or any time thereafter, whether or not such representation or warranty was based upon Developer's knowledge and/or belief as of a certain date, Developer will give immediate written notice of such changed fact or circumstance to City. 882/012782-0020 � 39O27r0���06/01 /20 -48- March 19, 2019 Item #3.1 Resolution No. 19-013 ARTICLE IX DEFAULTS, REMEDIES AND TERMINATION Section 9.1 Defaults - General. (a) Subject to any extensions of time provided for in this Agreement, failure or delay by either Party to perform any term or provision of this Agreement within thirty (30) calendar days after receipt of written notice from the injured Party specifying such default, or if such default cannot reasonably be cured within thirty (30) days, to commence to cure, correct or remedy such default and to diligently and continuously prosecute such cure, correction or remedy to completion, shall constitute a default under this Agreement. (b) Delay in giving such written notice shall not constitute a waiver of any default nor shall it change the time of default. (c) Any failure or delays by either Party in asserting any of their rights and/or remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies. Delays by either Party in asserting any of their rights and/or remedies shall not deprive either Party of its right to institute and maintain any actions or proceedings that it may deem necessary to protect, assert or enforce any such rights or remedies. Section 9.2 Events of Default. In addition to other acts or omissions of Developer that may constitute a default or breach of this Agreement, the occurrence of any of the following specific events, prior to the issuance of a Release of Construction Covenants for the Project, shall constitute an "Event of Default" under this Agreement and shall not be subject to the provisions of Section 9.1: (a) Any default by Developer of any of the non -monetary covenants and conditions of this Agreement that is not cured within thirty (30) days following written notice of the default to Developer from City or the expiration of an applicable shorter cure period set forth in this Agreement, or if such default cannot reasonably be cured within the applicable cure period, to commence to cure, correct or remedy such and to diligently and continuously prosecute such cure, correction or remedy to completion. (b) Any representation, warranty or disclosure made to City by Developer regarding this Agreement or the Project is materially false or misleading at the time it is made. (c) Developer fails to make any payment or deposit of funds required under this Agreement, or to pay any other charge set forth in this Agreement, following seven (7) days' written notice to Developer from City of such failure. (d) Any material deviation in the work of improvement of the Project from the approved Scope of Development, other than Minor Field Changes, without the prior written approval of City, which approval shall not be unreasonably withheld or delayed, or the appearance, during the course of initial construction, of materially defective 882/012782-0020 gi98fig6/01/20 -49- March 19, 2019 Item #3.1 Resolution No. 19-013 workmanship or materials and such material defects are not corrected or substantially corrected, within thirty (30) days after receipt of written notice thereof from City to Developer, subject to a time extension as required in order to address any subcontractor disputes, design a "fix" for the defects and to allow the same to be so repaired. (e) The construction of the Project is delayed or suspended, or the development of the Project does not proceed with reasonable due diligence, pursuant to the Schedule of Performance, subject to the occurrence of Unavoidable Delays. (f) The Developer sells, Transfers, hypothecates, encumbers or assigns its interest in this Agreement, the Property or any portion thereof, whether voluntarily or involuntarily or by operation of law, in violation of the terms and conditions of this Agreement; it being agreed that Permitted Transfers shall not be in violation hereof. Section 9.3 Liquidated Damages to City. (a) UPON THE OCCURRENCE, PRIOR TO THE CLOSE OF ESCROW, OF AN EVENT OF DEFAULT, OR OTHER MATERIAL DEFAULT OF DEVELOPER UNDER THIS AGREEMENT THAT IS NOT CURED WITHIN THE APPLICABLE CURE PERIOD SET FORTH IN THIS AGREEMENT, CITY MAY TERMINATE THIS AGREEMENT AND CANCEL THE ESCROW, PURSUANT TO SECTION 4.10, WITHOUT ANY LIABILITY OF CITY TO DEVELOPER OR ANY OTHER PERSON ARISING FROM SUCH ACTIONS. CITY AND DEVELOPER ACKNOWLEDGE THAT IT IS EXTREMELY DIFFICULT AND IMPRACTICAL, IF NOT IMPOSSIBLE, TO ASCERTAIN THE AMOUNT OF DAMAGES THAT WOULD BE SUFFERED BY CITY, IN THE EVENT OF A TERMINATION OF THIS AGREEMENT DUE TO THE OCCURRENCE, PRIOR TO THE CLOSE OF ESCROW, OF AN EVENT OF DEFAULT, OR OTHER MATERIAL DEFAULT OF DEVELOPER UNDER THIS AGREEMENT THAT IS NOT CURED WITHIN THE APPLICABLE CURE PERIOD SET FORTH IN THIS AGREEMENT. HAVING MADE DILIGENT BUT UNSUCCESSFUL ATTEMPTS TO ASCERTAIN THE ACTUAL DAMAGES CITY WOULD SUFFER, IN THE EVENT OF A TERMINATION OF THIS AGREEMENT DUE TO THE OCCURRENCE, PRIOR TO THE CLOSE OF ESCROW, OF AN EVENT OF DEFAULT, OR OTHER MATERIAL DEFAULT OF DEVELOPER UNDER THIS AGREEMENT THAT IS NOT CURED WITHIN THE APPLICABLE CURE PERIOD SET FORTH IN THIS AGREEMENT, CITY AND DEVELOPER AGREE THAT A REASONABLE ESTIMATE OF CITY'S DAMAGES IN SUCH EVENT IS THE EARNEST MONEY DEPOSIT OF TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000). THEREFORE, UPON THE TERMINATION OF THIS AGREEMENT BY CITY DUE TO THE OCCURRENCE, PRIOR TO THE CLOSE OF ESCROW, OF AN EVENT OF DEFAULT, OR OTHER MATERIAL DEFAULT OF DEVELOPER UNDER THIS AGREEMENT THAT IS NOT CURED WITHIN THE APPLICABLE CURE PERIOD SET FORTH IN THIS AGREEMENT, ESCROW HOLDER SHALL IMMEDIATELY CANCEL THE ESCROW AND CITY SHALL BE ENTITLED TO RETAIN THE EARNEST MONEY DEPOSIT. RETENTION OF THE EARNEST MONEY DEPOSIT SHALL BE CITY'S SOLE AND EXCLUSIVE REMEDY UPON THE OCCURRENCE, PRIOR TO THE CLOSE OF ESCROW, OF AN EVENT OF DEFAULT OR OTHER MATERIAL DEFAULT OF DEVELOPER UNDER THIS 882/012782-0020 gggi g6/01 /20 -50- March 19, 2019 Item #3.1 Resolution No. 19-013 AGREEMENT THAT IS NOT CURED WITHIN THE APPLICABLE CURE PERIOD SET FORTH IN THIS AGREEMENT. (b) CITY ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 9.3, WHICH CIVIL CODE SECTION READS AS FOLLOWS: A general release does not extend to claims which the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party. (c) BY INITIALING BELOW, CITY KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS AND RELEASES OF THIS SECT -ION 9.3: \J/vk CITY'S INITIALS Section 9.4 Developer's Limitation on Recovery of Damages Prior to Close of Escrow. (a) IN THE EVENT OF ANY MATERIAL BREACH OF THIS AGREEMENT BY CITY PRIOR TO THE CLOSE OF ESCROW, DEVELOPER'S REMEDIES SHALL BE LIMITED TO A CHOICE BETWEEN (1) SPECIFIC PERFORMANCE OR (2) TERMINATION OF THIS AGREEMENT AND RECOVERY OF THE EARNEST MONEY DEPOSIT. DEVELOPER WAIVES ANY RIGHT TO RECOVER ANY OTHER SUMS FROM CITY ARISING FROM A MATERIAL BREACH OF THIS AGREEMENT BY CITY PRIOR TO THE CLOSE OF ESCROW. NOTWITHSTANDING THE FOREGOING OR ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, IF SPECIFIC PERFORMANCE OF THIS AGREEMENT IS NOT AVAILABLE TO DEVELOPER BECAUSE (A) CITY HAS SOLD, OR GRANTED AN OPTION AS TO, THE PROPERTY TO A THIRD PARTY, OR (B) CITY HAS MORTGAGED OR OTHERWISE BY AFFIRMATIVE ACTION OF CITY ENCUMBERED THE PROPERTY, AND IS UNWILLING OR UNABLE TO REMOVE SUCH MORTGAGE OR ENCUMBRANCE (IT BEING UNDERSTOOD THAT IF CITY IS UNWILLING OR UNABLE TO REMOVE SUCH MORTGAGE OR ENCUMBRANCE, DEVELOPER SHALL HAVE THE RIGHT TO REMOVE SUCH MORTGAGE OR ENCUMBRANCE THROUGH PAYMENT ON BEHALF OF CITY AND TO OBTAIN A CREDIT TOWARDS THE PURCHASE PRICE IN THE AMOUNT OF SUCH PAYMENT), THEN IN ADDITION TO THE RETURN OF THE EARNEST MONEY DEPOSIT, CITY SHALL REIMBURSE DEVELOPER FOR DEVELOPER'S ACTUAL OUT-OF-POCKET, THIRD PARTY COSTS IN CONNECTION WITH ITS DUE DILIGENCE INVESTIGATION AND RELATED ACTIVITIES AND ITS LEGAL FEES IN NEGOTIATING AND DRAFTING THIS AGREEMENT AND RELATED DOCUMENTS, SUCH AMOUNT NOT TO EXCEED TWO HUNDRED THOUSAND DOLLARS ($200,000) IN TOTAL, WHICH EXPENSES 882/012782-0020 gigni18l19 -51- March 19, 2019 Item #3.1 Resolution No. 19-013 SHALL BE IDENTIFIED ON A WRITTEN SCHEDULE (TOGETHER WITH REASONABLY SUFFICIENT BACK-UP DOCUMENTATION EVIDENCING THE EXPENSES INCURRED) DELIVERED BY DEVELOPER TO CITY. DEVELOPER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 9.4, WHICH CML CODE SECTION READS AS FOLLOWS: A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. (b) BY INITIALING BELOW, DEVELOPER KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE W D RELEASES OF THIS SECTION 9.4: F3ER'S INITIALS Section 9.5 Legal Actions. (a) In addition to any other rights or remedies and subject -to the restrictions set forth in this Agreement, following the Close of Escrow, either Party may institute an action at law or equity to seek specific is performance of the terms of this Agreement, or to cure, correct or remedy any default, to recover damages for any default (subject to the restriction on Developer's rights to recover monet iy damages against City set forth in the final clause of this sentence), or to obtain any other remedy consistent with the purpose of this Agreement provided, however, that notwithstanding anything in the foregoing to the contrary, with the exception of Developer's rights pursuant to Section 9.4 above, in no event shall Developer be entitled to obtain monetary damages of any kind from City, including but not limited to damages for economic loss, lost profits, or any other economic or consequential damages of any kind. Such legal actions must be instituted in the Superior Court of the State of California in and for the County of San Diego, California, in any other appropriate court within the County of San Diego, California, or in the United States District Court for the Central District of California. (b) The laws of the State of California shall govern the interpretation and enforcement of this Agreement. The Parties acknowledge and agree that this Agreement is entered into, is to be fully performed in and relates to real property located in the City of Poway, County of San Diego, California. Section 9.6 Rights and Remiodieg are. Cumulative. Except as otherwise expressly stated in this Agreement, the rights andremedies of the Parties as set forth in this Section 9.6 are cumulative and the exercise by either Party of one or more of such aaaro� 2rexoo2o ISH9 -52- March 19, 2019 Item #3.1 Resolution No. 19-013 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. Section 9.7 Attorneys' 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 attorneys' fees. If either Party to this Agreement is required to initiate or defend litigation with a third party because of the violation of any term or provision of this Agreement by the other Party, then the Party so litigating shall be entitled to reasonable attorneys' fees from the other Party to this Agreement. Attorneys' 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, retaining expert witnesses, taking depositions and discovery, and all other necessary costs incurred with respect to 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. Section 9.8 Developer Indemnification of the City. In addition to any other specific indemnification or defense obligations of the Developer set forth in this Agreement, the Developer agrees to indemnify, defend (upon written request by the City and with counsel reasonably acceptable to the City) and hold harmless the City and City Personnel from any and all losses, liabilities, charges, damages, claims, liens, causes of action, awards, judgments, costs and expenses, including, but not limited to reasonable attorney's fees of counsel retained by the City, expert fees, and investigation costs, of whatever kind or nature (collectively, "Claims"), that are in any manner directly or indirectly caused, occasioned or contributed to in whole or in part, through any act, omission, fault or negligence, whether active or passive, of Developer or Developer's officers, agents, employees, independent contractors, subcontractors of any tier, or authorized representatives, relating in any manner to this Agreement, any work to be performed by Developer related to this Agreement, the Project, or any authority or obligation exercised or undertaken by Developer under this Agreement, except to the extent any such Claims are caused by the willful misconduct or active negligence of any of City and City Personnel. Without limiting the generality of the foregoing, Developer's obligation to indemnify City shall include injury or death to any person or persons, damage to any property, regardless of where located, including the property of City, any workers' compensation or prevailing wage determination, claim or suit or any other matter arising from or connected with any goods or materials provided or services or labor performed regarding the Project or the Property on behalf of Developer by any person or entity. ARTICLE X GENERAL PROVISIONS Section 10.1 Notices, Demands and Communications Between the Parties. (a) Any and all notices, demands or communications submitted by any Party to another Party pursuant to or as required by this Agreement shall be proper, if in writing and dispatched by messenger for immediate personal delivery, by a nationally 882/012782-0020 gg98foig6/o1/20 -53- March 19, 2019 Item #3.1 Resolution No. 19-013 recognized overnight courier service or by registered or certified United States mail, postage prepaid, return receipt requested, to the principal office of City or Developer, as applicable, as designated in subsection (b). 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. Any such notice, demand or communication shall be deemed to be received by the addressee, regardless of whether or when any return receipt is received by the sender or the date set forth on such return receipt, on the day that it is delivered by personal delivery, on the date of delivery by a nationally recognized overnight courier service or three (3) calendar days after it is placed in the United States mail, as provided in this Section 10.1(a). (b) The following are the authorized addresses for the submission of notices, demands or communications to the Parties: To the Developer: Poway Commons, LLC c/o Meridian Development, LLC 9988 H i be rt Street, Suite 210 San Diego, CA 92131 Attention: Guy As a ro With copy to: Higgs, Fletcher & Mack, LLP 401 West "A" Street, Suite 2600 San Diego, CA 92101 Attention: Tim Waters, Esq. To the City: City of Poway 13325 Civic Center Drive Poway, CA 92064 Attention: City Manager With copies to: Rutan & Tucker, LLP 611 Anton Blvd., Suite 1400 Costa Mesa, CA 92626 Attention: Alan Fenstermacher, Esq. Rutan & Tucker, LLP 611 Anton Blvd., Suite 1400 Costa Mesa, CA 92626 Attention: John A. Ramirez, Esq. Section 10.2 Conflict of Interest. No member, official or employee of City having any conflict of interest, direct or indirect, related to this Agreement or the development of the Project shall participate in any decision relating to this Agreement. The Parties represent and warrant that they do not have knowledge of any such conflict of interest. Section 10.3 Warranty Against Payment of Consideration for Agreement. Developer warrants that it has not paid or given, and will not pay or give, any third party any money or other consideration for obtaining this Agreement. Third parties, for the 882/012782-0020 gy98foig6/01/20 -54- March 19, 2019 Item #3.1 Resolution No. 19-013 purposes of this Section 10.3, shall not include persons to whom fees are paid for professional services, if rendered by attorneys, financial consultants, accountants, engineers, architects and the like when such fees are considered necessary by Developer. Section 10.4 Non -liability of City Officials and Employees. No member, official or employee of City shall be personally liable to Developer, or any successor in interest, in the event of any default or breach by City under this Agreement or for any amount that may become due to Developer or to its successor, or on any obligations under the terms of this Agreement, except as may arise from the gross negligence or willful acts of such member, official or employee. Section 10.5 Unavoidable Delay; Extension of Time of Performance. (a) Subject to specific provisions of this Agreement, performance by either Party under this Agreement shall not be deemed to be in default, or considered to be a default, where any such delays or defaults are due to an Unavoidable Delay that is not attributable to the fault of the Party claiming an extension of time to perform. An extension of time for any Unavoidable Delay shall be for the period of the Unavoidable Delay and shall commence to run from the date of occurrence of the Unavoidable Delay, but only if the Party asserting the existence of the Unavoidable Delay has first provided the other Party with written notice of the occurrence of the Unavoidable Delay, within ten (10) days of the commencement of such asserted Unavoidable Delay. (b) The Parties expressly acknowledge and agree that changes in either general economic conditions or changes in the economic assumptions of either of them that may have provided a basis for entering into this Agreement and that occur at any time after the execution of this Agreement, do not constitute an Unavoidable Delay and do not provide any Party with grounds for asserting the existence of an Unavoidable Delay in the performance of any covenant or undertaking arising under this Agreement. Each Party expressly assumes the risk that changes in general economic conditions or changes in such economic assumptions relating to the terms and covenants of this Agreement could impose an inconvenience or hardship on the continued performance of such Party under this Agreement. Section 10.6 Right of First Refusal. Upon the Close of Escrow, City shall have a right of first refusal with respect to any sale of the Property, pursuant to the following process: If at any time prior to the Project Completion Date, Developer (i) receives an offer acceptable to Developer for the purchase of the Property (or any portion thereof not completed) (an "Acceptable Offer"), or (ii) determines terms on which Developer is willing to sell the Property (or applicable portion thereof) ("Acceptable Terms"), then Developer shall forthwith forward a copy of such Acceptable Offer or Acceptable Terms (as applicable) to City. 882/012782-0020 gig i i06/01/20 -55- March 19, 2019 Item #3.1 Resolution No. 19-013 City shall have a period of sixty (60) days after receiving such copy of the Acceptable Offer or Acceptable Terms (as applicable) within which to notify Developer that City elects to purchase the Property (or applicable portion thereof) on the terms contained therein (except, with respect to an Acceptable Offer, any terms not relevant to City's purchase of the Property (or applicable portion thereof), such as contingency clauses, etc.) (a "Right of First Refusal Exercise Notice"). Any Right of First Refusal Exercise Notice shall be accompanied by any earnest money required under the terms of the Acceptable Offer (if applicable), and collectively with the Acceptable Offer or Acceptable Terms (as applicable) shall then constitute a contract between City and Developer. If City does not provide a Right of First Refusal Notice within the sixty (60) day period stated in the immediately preceding paragraph, City shall be deemed to have waived its right of first refusal with respect to the foregoing Acceptable Offer or Acceptable Terms, and City shall upon request execute and deliver an instrument in recordable form appropriate to evidence City's relinquishment of its rights under this Section 10.6 with respect to such transaction. Notwithstanding any such relinquishment, City's rights under this Section 10.6 shall remain in effect if the transaction contemplated by the Acceptable Offer or a transaction pursuant to the Acceptable Terms (as applicable) fails for any reason to close, with respect to any subsequent offer to purchase the Property (or applicable portion thereof). Nothing in this Section 10.6 authorizes Developer to sell any portion of the Property in violation of the provisions of Section 1.3 of this Agreement. Section 10.7 Real Estate Commissions. City shall not be liable for any real estate commissions, brokerage fees or finder fees that may arise from or be related to this Agreement. Developer shall pay any fees or commissions or other expenses related to its retention or employment of real estate brokers, agents or other professionals. Section 10.8 Binding on Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective heirs, executors, administrators, legal representatives, successors and assigns. Section 10.9 Entire Agreement. This Agreement integrates all of the terms and conditions mentioned in this Agreement or incidental to this Agreement, and supersedes all negotiations or previous agreements between the Parties with respect to the Property and the Project. Section 10.10 No Merger. None of the terms, covenants, agreements or conditions set forth in this Agreement shall be deemed to be merged with any deed conveying title to the Property, and this Agreement shall continue in full force and effect before and after such conveyances. Section 10.11 Waivers. All waivers of the provisions of this Agreement and all amendments to this Agreement must be in writing and signed by the authorized representative(s) of both City and Developer. 882/012782-0020 gg98foig6to1/20 -56- March 19, 2019 Item #3.1 Resolution No. 19-013 Section 10.12 Survival of Indemnity Obligations. All general and specific indemnity and defense obligations of the Parties set forth in this Agreement shall survive the expiration or termination of this Agreement and the execution or recordation of the City Grant Deed and/or City's issuance of a Release of Construction Covenants for the Project for a period of three (3) years. Section 10.13 City Approvals and Actions. City shall maintain authority of this Agreement and the authority to implement this Agreement through the City Manager (or his or her duly authorized representative). The City Manager shall have the authority to make approvals, issue interpretations, execute documents, waive provisions, and/or enter into certain amendments of this Agreement on behalf of City so long as such actions do not materially or substantially change the basic business terms hereof, change the uses or development permitted on the Property, or add to the costs incurred or to be incurred by City as specified herein, and such approvals, interpretations, waivers and/or amendments may include extensions of time to perform as set forth in Section 5.5. All other material and/or substantive interpretations, waivers, or amendments shall require the consideration, action and written consent of the City Council. Section 10.14 Developer Termination. In the event that prior to the Close of Escrow all or a portion of the Property is condemned or there is a written threat of condemnation issued by a governmental authority or there is a spill or release of any Hazardous Substances not caused by Developer upon the Property, then Developer shall have the right, but not the obligation and upon written notice to City, to terminate the Agreement and be refunded the Earnest Money Deposit. Section 10.15 Possession. Upon the Escrow Closing Date, City shall deliver possession of the Property to Developer (or its assignee) free and clear of all rights or claims to possession and use. Section 10.16 Termination. Except where expressly set forth herein, Developer's obligations hereunder shall terminate upon the issuance of the Release of Construction Covenants. Section 10.17 Counterparts. This Agreement may be executed in several counterparts, and all so executed shall constitute one agreement binding on both Parties hereto, notwithstanding that both Parties are not signatories to the same counterpart. 882/012782-0020 ity98ioig6/o1/20 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK, SIGNATURE PAGE FOLLOWS] -57- March 19, 2019 Item #3.1 Resolution No. 19-013 IN WITNESS WHEREOF, City and Developer have executed this Purchase, Sale, and Development Agreement by and through the signatures of their duly authorized representative(s) set forth below: "City" CITY OF POWAY, a California municip I corporatio By: / 6'76U / --7.—_ Tina M. White, City Manager ATTEST: ice• • �v� . V ( �l� Faviola M:tir� . ,City erk APPROVED AS TO FORM: Alan Fenstermacher, City Attorney "Developer": POWAY COMMONS, LLC, a Delaware limited liability company By: _58- Guy Asaro, Manager Resolution No. 19-013 IN WITNESS WHEREOF, City and Developer have executed this Purchase, Sale, and Development Agreement by and through the signatures of their duly authorized representative(s) set forth below: acity CITY OF POWAY, a California municipal corporation By: ATTEST: Faviola Medina, City Clerk APPROVED AS TO FORM: RUTAN & TUCKER, LLP Alan Fensterrnacher, City Attorney asuaizraz-oozy iralirw" Tina M. White, City Manager "Develo►per": POWAY COMMONS, LLC, liability compan By: n ger aware limited March 19, 2019 ftem #3.1 Resolution No. 19-013 ATTACHMENT NO. 1 LEGAL DESCRIPTIONS A. Legal Description of City -Owned Property 13029 1/2 Poway Road: Real property in the City of Poway, County of San Diego, State of California, described as follows: PARCEL A: PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979. EXCEPTING THAT PORTION DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE WESTERLY ALONG THE SOUTHERLY LINE THEREOF A DISTANCE OF 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 0° 51' 30" EAST OF 0.40 FEET; THENCE SOUTH 89° 08' 30" EAST PARALLEL WITH SAID SOUTH LINE A DISTANCE OF 19.80 FEET; THENCE SOUTH 88° 59' 58" EAST 80.49 FEET TO THE INTERSECTION WITH THE EASTERLY LINE OF SAID PARCEL 2; THENCE SOUTHERLY ALONG SAID EASTERLY LINE A DISTANCE OF 0.20 FEET TO THE POINT OF BEGINNING. PARCEL B. AN EASEMENT FOR ROAD AND PUBLIC UTILITY PURPOSES OVER, UNDER, ALONG AND ACROSS THE WESTERLY 30.00 FEET OF PARCEL 1, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979. PARCEL C: AN EASEMENT FOR ROAD AND PUBLIC UTILITY PURPOSES OVER, UNDER, ALONG AND ACROSS A STRIP OF LAND 30.00 FEET IN WIDTH LYING WITHIN THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF, THE EASTERLY LINE OF SAID STRIP BEING THE MOST WESTERLY LINE OF PARCELS 1 AND 2 AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979. AP N : 317-472-25 882/012782-0020 ii98fig6/01/20 March 19, 2019 Item #3.1 Resolution No. 19-013 13053 Poway Road: Real property in the City of Poway, County of San Diego, State of California, described as follows: PARCEL A: THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE EASTERLY 133.495 FEET OF THE WESTERLY 466.99 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO OFFICIAL PLAT THEREOF. PARCEL B: AN EASEMENT FOR ROAD AND PUBLIC UTILITY PURPOSES TO BE USED IN COMMON WITH OTHERS OVER, UNDER, ALONG, AND ACROSS A STRIP OF LAND 60.00 FEET IN WIDTH LYING WITHIN THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO OFFICIAL PLAT THEREOF, THE CENTER LINE OF SAID 60.00 FOOT STRIP BEING DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHWESTERLY CORNER OF PARCEL 1 ABOVE; THENCE NORTHERLY ALONG THE WESTERLY LINE OF SAID PARCEL 1 AND THE NORTHERLY EXTENSION OF SAID WESTERLY LINE 265.00 FEET TO THE SOUTH LINE OF THE NORTH 50.00 FEET OF THE SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13. EXCEPTING THEREFROM THAT PORTION INCLUDED WITHIN PARCEL A HEREINABOVE DESCRIBED. PARCEL C: AN EASEMENT FOR PUBLIC UTILITY PURPOSES OVER, UNDER, AND ACROSS THE SOUTHERLY 5.00 FEET OF THE NORTHERLY 315.00 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, , STATE OF CALIFORNIA, ACCORDING TO OFFICIAL PLAT THEREOF, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE OF SAID SOUTHWEST QUARTER, SOUTH 00° 49' 00" WEST, 614.99 FEET TO THE MOST WESTERLY NORTHWEST CORNER OF LAND DESCRIBED IN DEED TO RUDOLPH WALTER MATZ, ET AL, RECORDED SEPTEMBER 13, 1956 IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS; THENCE ALONG THE BOUNDARY OF SAID MATZ'S LAND AS FOLLOWS: SOUTH 89° 08' 30" EAST, 733.99 FEET, AND NORTH 01 ° 07' 00" EAST, 615.00 FEET TO THE NORTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 13; 882/012782-0020 ig9dig6/01/20 -2- March 19, 2019 Item #3.1 Resolution No. 19-013 THENCE ALONG THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THE WESTERLY 466.99 FEET. EXCEPTING THEREFROM THE EASTERLY 134.26 FEET. PARCEL D: THAT PORTION OF PARCEL 2, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE ALONG THE SOUTHERLY LINE OF SAID PARCEL 2 NORTH 89° 08' 30" WEST, 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 00° 51' 30" EAST. 0.40 FEET; THENCE PARALLEL WITH THE SOUTHERLY LINE OF SAID PARCEL 2, SOUTH 89° 08' 30' EAST, 19.80 FEET; THENCE SOUTH 88° 59' 58" EAST, 80.49 FEET TO THE EASTERLY LINE OF SAID PARCEL 2; THENCE ALONG SAID EASTERLY LINE SOUTH 00° 49' 00" WEST, 0.20 FEET TO THE POINT OF BEGINNING. AP N : 317-472-24 882/012782-0020 i,3498i0ig6/01/20 -3- March 19, 2019 Item #3.1 Resolution No. 19-013 13033 Poway Road: Real property in the City of Poway, County of San Diego, State of California, described as follows: PARCEL 1: LOT 2 AND THAT PORTION OF LOT 1 OF K.N.Q. DEVELOPMENT IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA ACCORDING TO MAP THEREOF NO. 8019 FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, SEPTEMBER 12, 1974, BEING A PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, ACCORDING TO THE U.S. GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHWEST CORNER OF SAID LOT 2 OF MAP NO. 8019; THENCE ALONG THE SOUTHERLY LINE OF SAID MAP 8019 SOUTH 89°08'30" EAST 281.73 FEET; THENCE NORTH 1 °07'00" EAST 270.00 FEET TO THE NORTH LINE OF SAID LOT 1; THENCE NORTH 89°08'30" WEST 149.67 FEET TO A TANGENT 30.00 FOOT RADIUS CURVE CONCAVE NORTHEASTERLY; THENCE ALONG SAID CURVE THROUGH A CENTRAL ANGLE OF 90°00'00" A DISTANCE OF 47.12 FEET; THENCE NORTH 89°08'30" WEST 103.50 FEET TO THE WEST LINE OF SAID MAP 8019; THENCE SOUTH 0°49'00" WEST 300.00 FEET TO THE POINT OF BEGINNING. PARCEL 2: AN EASEMENT AND RIGHT OF WAY FOR ROAD AND PUBLIC UTILITY PURPOSES OVER, UNDER, ALONG AND ACROSS A STRIP OF LAND 60.00 FEET IN WIDTH, LYING WITHIN THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO UNITED STATES GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, THE CENTER LINE OF SAID STRIP OF LAND BEING THE EASTERLY LINE OF THE SOUTHERLY 265.00 FEET OF THE NORTHERLY 315.00 FEET OF THE WEST HALF OF THE EASTERLY 266.99 FEET OF THE WESTERLY 466.99 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO UNITED STATES GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE OF SAID SOUTHWEST QUARTER, SOUTH 00°49'00" WEST, 614.99 FEET TO THE MOST WESTERLY NORTHWEST CORNER OF LAND DESCRIBED IN DEED TO RUDOLPH WALTER MATZ, ET AL., RECORDED SEPTEMBER 13, 1956, IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS; THENCE ALONG THE BOUNDARY OF SAID MATZ'S LAND AS 882/012782-0020 iggig6/o1/20 -4- March 19, 2019 Item #3.1 Resolution No. 19-013 FOLLOWS: SOUTH 89°08'30" EAST, 733.99 FEET, AND NORTH 01 °07'00" EAST, 615.00 FEET TO THE NORTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, NORTH 89°08'30" WEST TO THE POINT OF BEGINNING. APN: 317-472-18 882/012782-0020 ig98foig6to1/20 -5- March 19, 2019 Item #3.1 Resolution No. 19-013 Real property in the City of Poway, County of San Diego, State of California, described as follows: PARCEL 2 OF PARCEL MAP NO. 9105, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, AUGUST 30, 1979 AS INSTRUMENT NO. 79-366067 OF OFFICIAL RECORDS. AP N : 317-472-23 882/012782-0020 iy98foig6/o1/20 -6- March 19, 2019 Item #3.1 Resolution No. 19-013 B. Legal Description of City -Owned Mixed Property 13100 Poway Road: The land referred to herein is situated in the State of California, County of San Diego and is described as follows: That portion of the Southwest Quarter of the Northwest Quarter of Section 13, Township 14 South, Range 2 West, San Bernardino Base and Meridian, in the City of Poway, County of San Diego, State of California, according to Official Plat thereof described as follows: Beginning at a point on the Southerly line of said Southwest Quarter of the Northwest Quarter, distant, thereon South 89°08'30" East 332.00 feet from the Southwest corner thereof, said point being the Southeast corner of land conveyed to James Albert Silkwood and wife, by deed recorded in Book 5316, Page 83 of Official Records; thence continuing South 89°08'30" East 281.00 feet; thence parallel with the West line of said Northwest Quarter North 01 °26'10" East 50 feet to the North line of the South 50 feet of said Northwest Quarter being the True Point of Beginning; thence along said line South 89°08'30" East 176.48 feet to a tangent 20 foot radius curve, concave Northwesterly in the Westerly line of Tarascan Drive as shown on Heritage Hills according to Map No. 5934 filed in the Office of the County Recorder of San Diego County; thence along the boundary line of said Map No. 5934, Northeasterly along said curve 31.17 feet; thence tangent to said curve North 1 °33'47" East 320.27 feet; thence North 89°08'30" West 68 feet; thence leaving said boundary North 89°08'30" West 129 feet to a line which bears North 01 °26'10" East parallel with said West line from the True Point of Beginning; thence South 01 °26'10" West 340.02 feet to the True Point of Beginning. APN: 317-101-06 882/012782-0020 igylig6/01/20 -7- March 19, 2019 Item #3.1 Resolution No. 19-013 C. Legal Description of Authority -Owned Property 13021 Poway Road: Real property in the City of Poway, County of San Diego, State of California, described as follows: THE WEST 200.00 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13 HEREIN DESCRIBED; THENCE SOUTH 0° 49' 00" WEST, 614.99 FEET; THENCE SOUTH 89° 08' 30" EAST, 733.99 FEET TO THE SOUTHWEST CORNER OF THAT PORTION OF PROPERTY CONVEYED TO RUDOLPH WALTER MATZ ET AL, ON SEPTEMBER 13, 1956 IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS; THENCE ALONG THE WESTERLY LINE OF THE PROPERTY CONVEYED TO MATZ, NORTH 1 ° 07' 00" EAST, 615.00 FEET TO THE NORTH LINE OF SAID SOUTHWEST QUARTER OF SECTION 13 HEREIN DESCRIBED; THENCE ALONG THE NORTH LINE OF THE SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THE NORTH 50.00 FEET OF THE WEST 200.00 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST. AP N : 317-472-01 882/012782-0020 iggi 06/01 /20 -8- March 19, 2019 Item #3.1 Resolution No. 19-013 13031 Poway Road: Real property in the City of Poway, County of San Diego, State of California, described as follows: PARCEL 1: THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE WEST HALF OF THE EASTERLY 266.99 FEET OF THE WESTERLY 466.99 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY, APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE OF SAID SOUTHWEST QUARTER SOUTH 00° 49' 00" WEST, 614.99 FEET TO THE MOST WESTERLY NORTHWEST CORNER OF LAND DESCRIBED IN DEED TO RUDOLPH WALTER MATZ, ET AL, RECORDED SEPTEMBER 13, 1956, IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS; THENCE ALONG THE BOUNDARY OF SAID MATZ'S LAND AS FOLLOWS: SOUTH 89° 08' 30" EAST, 733.99 FEET AND NORTH 01 ° 07' 00" EAST, 615.00 FEET TO THE NORTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. PARCEL 2: AN EASEMENT FOR ROAD AND PUBLIC UTILITY PURPOSES, TO BE USED IN COMMON WITH OTHERS OVER, UNDER, ALONG, AND ACROSS A STRIP OF LAND 60 FEET WIDE IN THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO UNITED STATES GOVERNMENT SURVEY APPROVED, NOVEMBER 19, 1880, THE CENTER LINE OF SAID 60 FOOT STRIP BEING DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEASTERLY CORNER OF PARCEL 1 ABOVE; THENCE NORTHERLY ALONG THE EASTERLY LINE OF SAID PARCEL 1 AND THE NORTHERLY EXTENSION OF SAID EASTERLY LINE, 265 FEET TO THE SOUTH LINE OF THE NORTH 50 FEET OF THE SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13. EXCEPTING THEREFROM THAT PORTION INCLUDED WITH PARCEL 1 ABOVE. AP N : 317-472-06-00 882/012782-0020 zid98foi 06/01 /20 -9- March 19, 2019 Item #3.1 Resolution No. 19-013 ATTACHMENT NO. 2A AREA SITE MAP ATTACHMENT 2A _ • ` .. _,.. , ( ^ NIL. hryryry---- PARCrt-. PE-i 1'F•:r.f ,1:IY I IE9 n BC3,,, . A•P ) . l‘kb LEGEND I , .fit ._...:.•k ... . . , .. • _ ' . �- �- �_ -..- � y-'�f Y Z =^1.=-_ A.,_ �S tn. �.'�1.. � �i'i: �- f'L-^r���� - - .�. . ..�_-�x{^ 1• Tt .. ! M M'M If'• -. - ��� ., .1 ..:L 7 7 `I r � ♦ . . i�rI.'R!r,��' j _. i•iW �7iiiiiffaili -_ ��/ may�yi� ♦♦,, f 1 #tlll#,� 1. P/MiCa 7 r ♦,-1i•.w + F Lk—%1 rn� -_ 4•'Tf. \.»-"._M 'tJ m ..: ,`,-- •/•••••#4 i ME§ w: .r u \ 1Gr:_R�7 ,. , t • 1/41,tv • , . (i Z!Ir1kI u _ ,� ..,:v ! •: _ 1 PARTS 1 o PA.. ',fart\ "4, `1E� • ���� _.. r- 4 t•1 •K.i 40,40 ia�aa I aaa!� li .,„, 'S♦,14 w. ...i, Vil ad E Iaa►/=eaaaaxJf t :1 •, . z _ IQKra"2"" taaaaaa� taa/ laaWE= ... ;mina aaa.em laaaaaaaaa Mita• *00 .4. _'4 ;4 \ /.OE�'.i0nrniusat Malta I. r� - 1 N - 1 ,.; .. , 3 x IatitudeE M Ffx Zr iY 1fY /U7111/IC =v !I.:. 882/012782-0020 1V1902 T ;51 /01 /20 March 19, 2019 Item #3.1 Resolution No. 19-013 ATTACHMENT 2B PROPOSED SUBDIVISION MAP [SEE ATTACHED] EXHIBIT 2B PROPOSED SUBDIVISION MAP MER,ID1 lik7/1111 MN OM UM 111111111111111.1" 1111111111111W 111 111111111111111111110111r t 119 j9. 1111111111111 /1111111 4x. 882/012782-0020 5)6/01/20 RETAIL AREA -Approx 2.3 gross acres AFFORDABLE AREA - Approx 0.9 gross acres RESIDENTIAL AREA - Approx 6.1 gross acres March 19, 2019 Item #3.1 Resolution No. 19-013 ATTACHMENT NO. 3 SCOPE OF DEVELOPMENT (Total Project Site area includes approximately 9.6 gross acres) The Project will consist of: • A retail land area on the Retail Parcels comprising approximately 2.2 acres that could include approximately 25,000 square feet of retail. The Phasel Retail Development Work shall include: (i) establishment of at least two legal lots defining the approximately 2.2 acre Retail Parcels area; (ii) completing remedial, rough and finish grading to an approved City plan, in accordance with compaction standards, (iii) installing wet and dry backbone utility services to ultimately service the future retail project, and (iv) stabilizing the Retail Parcels in accordance with the City's storm water standards. • A residential component that will include development of approximately 98 units of for -sale housing. All units are contemplated to be type V non -rate wood framed. Architectural style is "Gill / Monterrey style," subject to City approval. The units are generally described as follows: o Approximately 38 units of two-story attached condominiums. Unit size generally ranges from 1400-1600 square footage. The units will be configured 2-3 bedrooms, with approximately 2.5 baths. Each unit will have an attached two -car garage. o Approximately 54 units configured in three-story buildings. Product consists of three-story attached buildings, containing two-story townhomes and flat condominiums. Unit size generally ranges from 1700-2200 square footage. The units will be configured 3 bed rooms/lofts with 2 to 3 baths. Each unit will have an attached two -car garage. o Approximately 6 units of three-story attached condominiums. Unit size generally ranges from 1300-1800 square footage. The units will be configured 2-3 bedrooms, 2.5 baths. Each unit will have an attached two - car garage. This product will include a small live/work space associated with the units along Poway Road. Land development consists of demolition of approximately 59,000 square feet of existing structures, grading and remediation of soils, installation of wet & dry utilities and surface improvements. 882/012782-0020 gg98ioig6/o1/20 March 19, 2019 Item #3.1 Resolution No. 19-013 ATTACHMENT Na 4. SCHEDULE OF PERFORMANCE Task(Event Time for Performance 1. Open of Escrow 2. Developer submits tentative map application and design review package. Within 120 days of Escrow opening . After City staff approval* and within 60 days of said approval, City Councils approval of tentative map and design review package. Within 150 days of submittal . Developer submits grading plan Within 30 days of tentative map and design review approval • City Staff approval of grading plans Within 120 days of submittal 6. Close of Escrow. Developer submits improvement plans and final map. Within 30 days of grading plan approval 7. Developerposts bonds for grading,pulls p p grading permit, and after City staff approval* commences grading. 1 Within 30 days of Close of Escrow Y $• Developer post bonds for improvement plans. City Staff approval* of public improvement plans. City Council approval of final map after City staff approval. within 150 days of submittal after City staff approval . Developer commences improvements and submits residential building plans Within 60 days of City's approval of final map 10. Developer completes all public improvements required in the public improvement plans and rough grading and for first phase of all residential and retail 04,,, ir,,L.., ,.n «,} %,%tn rL� \Nithin 150 days of Developer start of improvements 11. Developer obtains building permits and commences construction of first phase of Residential Development, .... ......... . Wthin 30 days after Developer's completion of first phase site improvements * City staff approval is contingent upon developer addressing all staff corrections. Developer hereby advises City that the residential units comprising the Residential Development are expected to sell at a rate of 4.0f units per month. The pace of construction and completion of units after the first phase of the Residential Development will be commensurate with sales performance, bank covenants on sales, inventory, backlog and other lending guidelines as well as general economic conditions. 882/012782-0020 13J092Z.011y3115/19 March 19, 2019 Item #3.1 Resolution No. 19-013 ATTACHMENT NO. 5 FORM OF CITY GRANT DEED [SEE ATTACHED] 882/012782-0020 6w98ioi g6/01/20 March19, 2019 Item #3.1 cording Requested By: tt American Title Company HoniebuiIder Services Division RECORDING REQUESTED BY: AND WHEN RECORDED MAIL TO: Mail 1-610.c aferneat Poway Commons, LLC Attention: Guy Asaro 9988 Hibert Street, Suite 210 San Diego, CA 92131 Ore- t46*.51D311 31-7-47 DOC# 2020-0221514 1111111 1111111111111#11111111111111 11 1111111 1E Apr 30, 2020 03:54 PM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $1,921.00 (SB2 Atkins: $0.00) PCOR: YES PAGES: 10 (Space above for Recorder's Use Only) GRANT DEED The undersigned declares: Documentary transfer tax $ Pc-0, Computed on the consideration of the full value of property conveyed Exempt from recorder's fee pursuant to Government Code Section 27383 The undersigned declares exemption under the following: Exempt from fee per Government Code Section 27388.1 (a)(2)(D) For valuable consideration, the receipt of which is hereby acknowledged, the CITY OF POWAY, a California municipal corporation (the "City"), hereby grants to POWAY COMMONS, LLC, a Delaware limited liability company (the "Grantee"), the real property legally described in Exhibit "A" attached hereto and made a part hereof (the "Property"), subject to all matters of record and subject to the following: Grantee, on behalf of itself and its successors and assigns to all or any portion of the Property, covenants and agrees as follows: Section 1, Nondiscrimination Covenants. That there shall be no discrimination against or segregation of any person, or group of persons on any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, or any part thereof, nor shall Grantee, 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, 9565558.3 sublessees or vendees of the Property, or any part thereof. The foregoing covenants shall run with the land. Section 2. Nondiscrimination Clauses in Agreements. Grantee agrees for itself and any successor in interest that Grantee shall refrain from restricting the rental, sale, or lease of any portion of the Property, or contracts relating to the Property, on the basis of race, color, creed, religion, sex, marital status, ancestry, or national origin of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: 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 any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any 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 premises herein conveyed. The foregoing covenants shall run with the land." ii. 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: "That there shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, 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." iii. In contracts relating to the sale, transfer, or leasing of the land or any interest therein: "There shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and_Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises which are the subject of this agreement, nor shall the grantee or any person claiming under or through him or her, establish or permit any 9565558.3 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 premises herein conveyed. The foregoing covenants shall run with the land." The foregoing nondiscrimination covenants shall remain in effect in perpetuity. IN WITNESS WHEREOF, the City has causecilhis Grant Deed to be executed by its authorized representative(s) on this Aq7by of aprii 2020. City: CITY OF POWAY, a California municipal corporation By: Chris Hazel ine, City Manager By execution below, Grantee accepts and agrees to be bound by all of the covenants, restrictions, and obligations set forth in this Grant Deed. Grantee: POWAY COMMONS, LLC A Delaware limited liability company By: 9565558.3 Signed in Courrterpart Guy Asaro, Manager 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 premises herein conveyed. The foregoing covenants shall run with the land." The foregoing nondiscrimination covenants shall remain in effect in perpetuity. IN WITNESS WHEREOF, the City has causeAthis Grant Deed to be executed by its authorized representative(s) on thisaq'clay of 2020. City: CITY OF POWAY, a California municipal corporation By: Signed in Counterpart Chris Hazeltine, City Manager By execution below, Grantee accepts and agrees to be bound by all of the covenants, restrictions, and obligations set forth in this Grant Deed. Grantee: POWAY COMMONS, C A Delawar ited • By: 9565553.3 ility company Guy Asaro, Manager A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of at On Aio rt 1 4- q, c)--vc)--v , before me, agia 1411, PO4-41 Paist;6 (insert, name and title of the ancer) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person* whose name() is/ar-e subscribed to the within instrument and acknowledged to me that he/sheithey executed the same in his/h.edthetr authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the persons-)- acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature edia 9565558.3 4 (Seal) CAROL S LEGG Notary Public- California San Diego County Commission # 2283958 My Comm. Expires Apr 28. 2023 A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of ccict4- ale50 On 8v; 7 fdtd0 Notary Public, personally appeared , before me, Ai 01, W;1/4hcoi-, (In.sert name and title of the °nicer) Askvo who proved to me on the basis of satisfactory evidence to be the person(61 whose nxnefes)6are subscribed to the witM instrument and acknowledged to me thatbd/sh they executed the same inMfheritheir authorized capacity(jesl, and that by /her/their signaturecsl on the instrument the person(s), or the entity upon behalf of which the person(s acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature Ari.d_KL I/UM 9565558.3 (Seal) ANNETTE M. WILKINSON Notary Public - California San Diego County Commission # 2157324 My Comm. Expires Jul 17, 2020 EXHIBIT "A" LEGAL DESCRIPTION OF PROPERTY Real property in the City of Poway, County of San Diego, State of California, described as follows: PARCEL 1 THE WEST 200.00 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13 HEREIN DESCRIBED; THENCE SOUTH 0° 49' 00" WEST, 614.99 FEET; THENCE SOUTH 89° 08' 30" EAST, 733.99 FEET TO THE SOUTHWEST CORNER OF THAT PORTION OF PROPERTY CONVEYED TO RUDOLPH WALTER MATZ ET AL, ON SEPTEMBER 13, 1956 IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY; THENCE ALONG THE WESTERLY LINE OF THE PROPERTY CONVEYED TO MATZ, NORTH 1 ° 07' 00" EAST, 615.00 FEET TO THE NORTH LINE OF SAID SOUTHWEST QUARTER OF SECTION 13 HEREIN DESCRIBED; THENCE ALONG THE NORTH LINE OF THE SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THE NORTH 50.00 FEET OF THE WEST 200.00 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST. ALSO EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. Page 1 of 4 PARCEL 2 9565558.3 THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE WEST HALF OF THE EASTERLY 266.99 FEET OF THE WESTERLY 466.99 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY, APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE OF SAID SOUTHWEST QUARTER SOUTH 00°49' 00" WEST, 614.99 FEET TO THE MOST WESTERLY NORTHWEST CORNER OF LAND DESCRIBED IN DEED TO RUDOLPH WALTER MATZ, ET AL, RECORDED SEPTEMBER 13, 1956, IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY; THENCE ALONG THE BOUNDARY OF SAID MATZ'S LAND AS FOLLOWS: SOUTH 89° 08' 30" EAST, 733.99 FEET AND NORTH 01 ° 07' 00" EAST, 615.00 FEET TO THE NORTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01 ° 16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. Page 2 of 4 9565558.3 PARCEL 3 THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE EASTERLY 133.495 FEET OF THE WESTERLY 466.99 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO OFFICIAL PLAT THEREOF. EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. PARCEL 4 THAT PORTION OF PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE ALONG THE SOUTHERLY LINE OF SAID PARCEL 2 NORTH 89°08'30" WEST, 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 00°51'30" EAST, 0.40 FEET; THENCE PARALLEL WITH THE SOUTHERLY LINE OF SAID PARCEL 2, SOUTH 89°08'30" EAST, 19.80 FEET; THENCE SOUTH 88°59'58" EAST 80.49 FEET TO THE EASTERLY LINE OF SAID PARCEL 2; THENCE ALONG SAID EASTERLY LINE SOUTH 00°49'00" WEST, 0.20 FEET TO THE POINT OF BEGINNING. Page 3 of 4 9565558.3 PARCEL 5 PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979. EXCEPTING THAT PORTION DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE WESTERLY ALONG THE SOUTHERLY LINE THEREOF A DISTANCE OF 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 0°51'30" EAST A DISTANCE OF 0.40 FEET; THENCE SOUTH 89°08'30" EAST PARALLEL WITH SAID SOUTH LINE A DISTANCE OF 19.80 FEET; THENCE SOUTH 88°59'58" EAST 80.49 FEET TO THE INTERSECTION WITH THE EASTERLY LINE OF SAID PARCEL 2; THENCE SOUTHERLY ALONG SAID EASTERLY LINE A DISTANCE OF 0.20 FEET TO THE POINT OF BEGINNING. Page 4 of 4 M:133451081Le al Descri tions1A05 Deed -City to Poway Commons- Uo m m . do cx l 3 2104.9a03 15119 Resolution No, 19-013 882/012782-0020 6310914.0ig�aQ6/01/20 ATTACHMENT NO. 6 FORM OF MEMORANDUM OF AGREEMENT [SEE ATTACHED] March 19, 2019 Item #3.1 RIECLELEFAE ri,-UQUET-SLTED 513'n First American Title Company D 0 44. 7,7 virrialm REtZMED DTDCLN-1E17 City of Poway 13325 Civic Center Drive Attn: City Clerk Poway, CA 92064 A.P.N.: 317-472-18-00 and 317-472-23-00 and 317-472-24-00 and 317-472-25-00 and 317-101-06-00 Prope.rbi Address: vacant land, Poway, CA Memorandum of Aareement Title of Document 1[111111, III! ii11111111111111111'1111 11 Apr 30, 2020 03:54, PM OFFICIAL RECORDS. Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER, FEES: $0.00 (5B2 Atkins: $0.00) PAGES: 1-1 .f\i.,-;Div,•?. This Line for Recorder's Use.. Oni7 Fie lo.: DTR-5903772 (SK) (x ) Recorded [concurrently] in connection with a transfer of real property subject to the imposition of Documentary Transfer Tax per GC 27338.1 (a) (2). ) Recorded [concurrently] in connection with a transfer of real property that is residential dwelling to an owner - occupier per GC 27388.1 (a) (2). ) Maximum fee of $225 has been reached per GC 27388.1 (a) (1). ()Not related to real property GC 27388.1 (a) (1). ()Transfer of real property subject to the imposition of Documentary Transfer Tax - GC 27388.1 (a)(2) ) Transfer of real property that is a residential dwelling to an owner -occupier - GC 27388.1 (a)(2) ) Exempt from Tee under GC.27388.1 due to being recorde-d in connection with a transaction that was subject to documentary transfer tax which was paid on document recorded as Document No. of Official Records ) Exempt from fee under GC 27388.1 due to the ma,,imum fees having been paid on document(s) recorded as Document No. of Official Records ()Exempt from fee under GC 27388.1 due to it being recorded in connection with a transfer of real properb/ that is a residential dwelling to an owner -occupier. The recorded document transferring the dwelling to the owner - occupier was recorded as document No. of Official Records. ()Exempt from fee under GC 27338.1 for the following reasons: THIS PAGE ADDED TO PROVIDE EXEMPTION INFORMATION FOR THE BUILDING HOMES AND 3035 ACT FEE (58-2; AFFORDABLE HOUSING FEE) ($3.00 Additional recording fee applies) • ••_, • Liompany Homebuilder Services Division RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Poway 13325 Civic Center Drive Poway, CA 92064 Attn: City Clerk Order 14o:,51b)11S (Space above for Recorder's Use Only) [Recordation of this Document is Exempt From Fees Payable to the Recorder Under Government Code Section 27383] CITY OF POWAY MEMORANDUM OF AGREEMENT (PURCHASE, SALE, AND DEVELOPMENT AGREEMENT — RETAIL PORTION) This MEMORANDUM OF AGREEMENT (PURCHASE, SALE, AND DEVELOPMENT AGREEMENT) ("Memorandum") is entered into as of this , day of , 2020, by and between POWAY COMMONS, LLC, a Delaware limited liability company (the "Developer") and the CITY OF POWAY, a California municipal corporation (the "City"). This Memorandum is made with reference to the following: 1. Developer is the owner in fee of that certain real property located in the City of Poway, County of San Diego, State of California, more particularly described in the legal description attached hereto as Exhibit "A" and incorporated herein by this reference ("Property"). 2. On or about April 11, 2019, City and Developer entered into that certain tAn — Purchase, Sale, and Development Agreement, as amended by that certain First ReroR, Amendment to Purchase, Sale and Development Agreement dated as of August 12, 2019 and by that certain Second Amendment to Purchase, Sale and Development Agreement dated as of December 5, 2019 (collectively, "PSDA") which provides for, among other things, Developer to develop a development with 97 detached single family residential units and common area improvements and amenities to serve such units, and a retail development. Developer has assigned the residential portion of the PSDA to its affiliate, MC Poway 97 LLC, a Delaware limited liability company ("MC Poway 97"). MC Poway 97 and the City are executing and causing to be recorded concurrently herewith a similar Memorandum of Agreement with respect to the property to be acquired by MC Poway 97 under the PSDA. 3. The PSDA provides City with (i) a right of first refusal to purchase the Properly (or certain portions thereof) if Developer desires to sell the Property, and (ii) a right to purchase the retail portion of the Property on the occurrence of certain, specified events, all as more fully described in the PSDA. 882/012782-0020 13092704.7 a03/13/19 9565773.2 4. The PSDA provides for City and Developer to enter into this Memorandum and to record the same in the Official Records of San Diego County, California, to provide notice to all persons of the existence of said PSDA, which PSDA is binding on Developer and Developer's successors -in -interest as to the Property. 5. A copy of the PSDA is on file with the City Clerk of City and is available for inspection and copying by interested persons as a public record of City during the regular business hours of City. 6. This Memorandum may be executed in several counterparts, and all so executed shall constitute one agreement binding on both parties hereto, notwithstanding that both parties are not signatories to the original or the same counterpart. THIS MEMORANDUM OF AGREEMENT is dated as of A-yr) ' , 20 , and has been executed on behalf of Developer and City by and through the signatures of their authorized representative(s) set forth below. This Memorandum of Agreement may be executed in counterparts and when fully executed each counterpart shall be deemed to be one original instrument. nte rim City Clef k 0 VA. A-e6\a"), / 6-Ni\ APPROVED AS TO FORM: RUTAN & TUCKER, LLP Siignedii Couctilei---pa1 Alan Fenstermacher, City Attorney 882/012782-0020 13092704.7 a03/13/19 9565773.2 -2- "City" CITY OF POWAY, a California municipal corporation By: 1 r Chris Haz,-.1' , City Manager "Developer" POWAY COMMONS, LLC, a Delaware limited liability company Simed By: Guy Asaro, Manager 4. The PSDA provides for City and Developer to enter into this Memorandum and to record the same in the Official Records of San Diego County, California, to provide notice to all persons of the existence of said PSDA, which PSDA is binding on Developer and Developer's successors -in -interest as to the Property. 5. A copy of the PSDA is on file with the City Clerk of City and is available for inspection and copying by interested persons as a public record of City during the regular business hours of City. 6. This Memorandum may be executed in several counterparts, and all so executed shall constitute one agreement binding on both parties hereto, notwithstanding that both parties are not signatories to the original or the same counterpart. THIS MEMORANDUM OF AGREEMENT is dated as of a POI X, 2020 and has been executed on behalf of Developer and City by and through the signatures of their authorized representative(s) set forth below. This Memorandum of Agreement may be executed in counterparts and when fully executed each counterpart shall be deemed to be one original instrument. "City" CITY OF POWAY, a California municipal corporation By: ATTEST: A. Kay Vinson, Interim City Clerk Sigel in Counteraat- Chris Hazeltine, City Manager APPROVED AS TO FORM: "Developer" RUTAN n TUCKER, LLP 2 7=` / (-;11 ,' Alan Fenstermacher, City Attorney 882/012782-0020 13092704.7 a03/13/19 9565773.2 -2- P WAY COMMONS, LLC, a Delaware limited liability company By: Sligned in Cotratetpon Guy Asaro, Manager 4. The PSDA provides for City and Developer to enter into this Memorandum and to record the same in the Official Records of San Diego County, California, to provide notice to all persons of the existence of said PSDA, which PSDA is binding on Developer and Developer's successors -in -interest as to the Property. 5. A copy of the PSDA is on file with the City Clerk of City and is available for inspection and copying by interested persons as a public record of City during the regular business hours of City. 6. This Memorandum may be executed in several counterparts, and all so executed shall constitute one agreement binding on both parties hereto, notwithstanding that both parties are not signatories to the original or the same counterpart. THIS MEMORANDUM OF AGREEMENT is dated as of hprigi 4, 202A and has been executed on behalf of Developer and City by and through the signatures of their authorized representative(s) set forth below. This Memorandum of Agreement may be executed in counterparts and when fully executed each counterpart shall be deemed to be one original instrument. ATTEST: Signed in Coupa A. Kay Vinson, Interim City Clerk A R OVED AS TO FOR N E,?-.; TUCKER, LLP Siped in Cott Alan Fenstermacher, City Attorney 882/012782-0020 13092704.7 a03/13/19 9565773.2 -2- "City" CITY OF POWAY, a California municipal corporation By: Signed in COUTItaii-pal Chris Hazeltine, City Manager "Developer" POWAY COMMONS, LJ limited liability pany / / / /___/ -- / 6/ By: anager a Delaware A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On A-pc,t 4-1) before me, 24/v( P 04r4,41, Pit u , (insert name and title of the officdr) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature agel-d d (1) CAROL S LEGG p li ,4•:...,-%---.`1,7-:,,,:,,,, Notary Public - California li San Diego County ,L; ..4 ,,.;-: 7 - ';-‘L--',.., Commission 1,t 2233958 My Cor-rr. Eq)ires Aor 23" 2023 1--,-_---,--------1--------- . (Seal) A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On , before me, (insert name and title of the officer) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 882/012782-0020 13092704.7 a03/13/19 9565773.2 A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On , before me, 1YJv1kJ (insert name and title of the officer) Ili Notary Public, personally appeared &Ix who proved to me on the basis of satisfact&y evidence to be the person(s) whose name(S) as/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under that the foregoing paragraph is true and correct. '4; •-y'-';T:'-P'ANNETTE M. WILKINSON Notary Public - California San Diego County WITNESS my hand and official seal. :: ,-,,.,,,,L.__44,:; ',1, \\''','-'7:5-,t\-- Commission # 2157324- :I Mv Comm: E;:pives Jul 1 7, 2020 A:4:-,;!14 ..7—WikiliF.Ad~ Signature /‘ /1/41- 0/1 "Wit#‘.\_ (Seal) Iifornia A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On , before me, (insert name and title of the officer) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 882/012782-0020 13092704.7 a03/13/19 9565773.2 Exhibit A LEG °tL DESCRIPTION OF PROPERTY Real property in the City of Poway County of San Diego, State of California, described as follows: PARCEL 1 THE WEST 200.00 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13 HEREIN DESCRIBED; THENCE SOUTH 0° 49' 00" WEST, 614.99 FEET; THENCE SOUTH 89° 08' 30" EAST, 733.99 FEET TO THE SOUTHWEST CORNER OF THAT PORTION OF PROPERTY CONVEYED TO RUDOLPH WAL T ER MATZ ET AL, ON SEPTEMBER 13, 1956 IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY; THENCE ALONG THE WESTERLY LINE OF THE PROPERTY CONVEYED TO MATZ, NORTH 1 ° 07' 00" EAST, 615.00 FEET TO THE NORTH LINE OF SAID SOUTHWEST QUARTER OF SECTION 13 HEREIN DESCRIBED; THENCE ALONG THE NORTH LINE OF THE SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THE NORTH 50.00 FEET OF THE WEST 200.00 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST. ALSO EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. Page 1 of 4 882/012782-0020 13092704.7 a03/13/19 9565773.2 PARCEL 2 THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE WEST HALF OF THE EASTERLY 266.99 FEET OF THE WESTERLY 466.99 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY, APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE OF SAID SOUTHWEST QUARTER SOUTH 00°49' 00" WEST, 614.99 FEET TO THE MOST WESTERLY NORTHWEST CORNER OF LAND DESCRIBED IN DEED TO RUDOLPH WALTER MATZ, ET AL, RECORDED SEPTEMBER 13, 1956, IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY; THENCE ALONG THE BOUNDARY OF SAID MATZ'S LAND AS FOLLOWS: SOUTH 89° 08' 30" EAST, 733.99 FEET AND NORTH 01 ° 07' 00" EAST, 615.00 FEET TO THE NORTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. 882/012782-0020 13092704.7 a03/13/19 9565773.2 Page2of4 -3- PARCEL 3 THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE EASTERLY 133.495 FEET OF THE WESTERLY 466.99 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO OFFICIAL PLAT THEREOF. EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. PARCEL 4 THAT PORTION OF PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE ALONG THE SOUTHERLY LINE OF SAID PARCEL 2 NORTH 89°08'30" WEST, 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 00°51'30" EAST, 0.40 FEET; THENCE PARALLEL WITH THE SOUTHERLY LINE OF SAID PARCEL 2, SOUTH 89°08'30" EAST, 19.80 FEET; THENCE SOUTH 88°59'58" EAST 80.49 FEET TO THE EASTERLY LINE OF SAID PARCEL 2; THENCE ALONG SAID EASTERLY LINE SOUTH 00°49'00" WEST, 0.20 FEET TO THE POINT OF BEGINNING. 882/012782-0020 13092704.7 a03/13/19 9565773.2 Page 3 of 4 -4- PARCEL 5 PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979. EXCEPTING THAT PORTION DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE WESTERLY ALONG THE SOUTHERLY LINE THEREOF A DISTANCE OF 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 0°51'30" EAST A DISTANCE OF 0.40 FEET; THENCE SOUTH 89°08'30" EAST PARALLEL WITH SAID SOUTH LINE A DISTANCE OF 19.80 FEET; THENCE SOUTH 88°59'58" EAST 80.49 FEET TO THE INTERSECTION WITH THE EASTERLY LINE OF SAID PARCEL 2; THENCE SOUTHERLY ALONG SAID EASTERLY LINE A DISTANCE OF 0.20 FEET TO THE POINT OF BEGINNING. Page 4 of 4 lid:\3345\08\Legal Descriptions\A05 Deed -City to Poway Commons-Comm.docx13092704.9a03/15/19 882/012782-0020 13092704.7 a03/13/19 9565773.2 Resolution No. 19-013 ATTACHMENT NO. 7 CITY NOTE [SEE ATTACHED] 882/012782-0020 6t)96i0i LS 6/01/20 March 19, 2019 Item #3.1 PROMISSORY NOTE SECURED BY DEED OF TRUST $1,700,000 Poway, California , 2020 (the "Note Date") FOR VALUE RECEIVED, the undersigned ("Maker") promises to pay to the CITY OF POWAY, a California municipal corporation ("Holder"), at 13325 Civic Center Drive, Poway, CA 92064, or at such other address as Holder may direct from time to time in writing, One Million Seven Hundred Thousand Dollars ($1,700,000) (the "Note Amount"), together with interest thereon as hereafter set forth. All sums hereunder shall be payable in lawful money of the United States of America. This Promissory Note Secured by Deed of Trust (the "Promissory Note" or "Note") is secured by a Deed of Trust with Assignment of Rents and Rider to Deed of Trust Attached Hereto of even date herewith, executed by Maker as Trustor in favor of Holder as Beneficiary (the "Deed of Trust"). 1. Purchase, Sale, and Development Agreement. This Promissory Note is made and delivered pursuant to and in implementation of that certain Purchase, Sale, and Development Agreement entered into between Holder and Maker on or about April 11, 2019, as amended by that certain First Amendment to Purchase, Sale and Development Agreement dated as of August 12, 2019 and by that certain Second Amendment to Purchase, Sale and Development Agreement dated as of December 5, 2019 (collectively, the "Agreement"), a copy of which is on file as a public record with Holder and is incorporated herein by reference. Pursuant to the terms of the Agreement, Holder sold to Maker certain real property located at in the City of Poway, County of San Diego, State of California (the "Property"), for a purchase price of Six Million Four Hundred Twenty Thousand Five Hundred Dollars ($6,420,500).(the "Purchase Price"). At the close of the escrow under the Agreement, Maker paid to Holder a portion of the Purchase Price, in the amount of Four Million Seven Hundred Twenty Thousand Five Hundred Dollars ($4,720,500), in cash. Holder agreed to loan to Maker the balance of the Purchase Price, which is the Note Amount. 2. Interest. Interest on the Note Amount shall accrue at the "Applicable Rate", which shall be the sum of (i) the rate published by the United States Department of the Treasury, as the interest rate for its Five -Year Treasury Bill, plus (ii) two and one - quarter percent (2.25%), compounded monthly. With respect to repayment of the Note Amount, the Applicable Rate shall be determined on the date that is fourteen (14) days prior to the date such repayment is due. 3. Time and Amount of Payment. The Note Amount, and all accrued interest thereon, shall be paid on the fourth (4th) anniversary of the Note Date. 4. Default Rate. Any amounts (including but not limited to amounts of principal and interest on the Note Amount) which Maker does not pay when otherwise due under the terms of this Note, shall bear interest at the rate of the lesser of ten percent (10%) or the maximum rate allowed per law per annum ("Default Rate"), simple 882/012782-0020 13092704.7 a03/13/19 9565736.3 interest, from the date which is ten (10) days after such amount would otherwise be due until the date paid. 5. Events of Acceleration. The entire outstanding principal balance of this Note, together with any outstanding interest and other amounts payable hereunder, shall, at the election of Holder and upon notice to Maker thereof, become immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby waived by Maker, if: a. Notwithstanding the payment terms set forth in Section 3 above, upon the occurrence of any "Event of Default" as set forth in Section 10 below; or b. Maker effects an assignment of this Note and/or sells or transfers any or all of its interests in the Property in violation of the terms and conditions of the Agreement. 6. Security for Note. This Promissory Note is secured by the Deed of Trust. 7. Prepayment of Note. Maker may prepay all or any portion of the outstanding principal or interest due under this Note to Holder without penalty. 8. Holder May Assign. Holder may, at its option and without obtaining the consent of Maker, assign its right to receive payment under this Promissory Note. 9. Maker Assignment. In no event shall Maker assign or transfer any portion of the Property or this Promissory Note except in compliance with the terms and conditions of the Agreement. Any assignment prohibited by this Section 9 shall be null and void. 10. Events of Default. The occurrence of any of the following shall, after the giving of any notice and expiration of any applicable cure period as described herein, constitute an event of default by Maker hereunder ("Event of Default"): a. The failure of Maker to pay or perform any monetary covenant or obligation under the terms of this Note without curing such failure within ten (10) days after receipt of written notice of such default from Holder (or from any party authorized by Holder to deliver such notice as identified by Holder in writing to Maker); b. The failure of Maker to perform any non -monetary covenant or obligation under this Note or the Deed of Trust without curing such failure within thirty (30) days after receipt of written notice of such default from Holder (or from any party authorized by Holder to deliver such notice as identified by Holder in writing to Maker) specifying the nature of the event or deficiency giving rise to the default and the action required to cure such deficiency. Provided, however, that if any default with respect to a non -monetary obligation is such that it cannot be cured within a thirty (30) day period, it shall be deemed cured if Maker commences the cure within said thirty (30) day period and diligently prosecutes such cure to completion thereafter. Notwithstanding anything 882/012782-0020 13092704.7 a03/13/19 9565736.3 -2- herein to the contrary, the herein described notice requirements and cure periods shall not apply to any Event of Default described in Sections 10(c) or 10(d) below; c. Maker shall (i) apply for or consent to the appointment of a receiver, trustee, liquidator or custodian or the like of its property, (ii) fail to pay or admit in writing its inability to pay its debts generally as they become due, (iii) make a general assignment for the benefit of creditors, (iv) be adjudicated bankrupt or insolvent or (v) commence a voluntary petition that is not withdrawn within ten (10) days of the filing thereof or answer seeking an arrangement with creditors or an order for relief or seeking to take advantage of any insolvency law or file an answer admitting the material allegations of a petition filed against it in any bankruptcy or insolvency proceeding; d. If without the application, approval or consent of Holder, a proceeding shall be instituted in any court of competent jurisdiction, under any law relating to bankruptcy, in respect of Holder, for an order for relief or an adjudication in bankruptcy, a composition or arrangement with creditors, a readjustment of debts, the appointment of a trustee, receiver, liquidator or custodian or the like of Holder or of all or any substantial part of Holder's assets, or other like relief in respect thereof under any bankruptcy or insolvency law, and, if such proceeding is being contested by Holder, in good faith, the same shall (i) result in the entry of an order for relief or any such adjudication or appointment, or (ii) continue undismissed, or pending and unstayed, for any period of ninety (90) consecutive days; or e. Maker shall be in default under any of the terms of any loan obtained by Maker that is secured by the Property, unless the default is cured within the cure period, if any, applicable thereto under the terms and obligation which is in default. f. Maker shall be in default under any of the terms of the Agreement, unless the default is cured within the cure period, if any, applicable thereto under the Agreement. 11. Holder Remedies. Upon the occurrence and during the continuance of an Event of Default hereunder, Holder may, in its sole discretion, take any one or more of the following actions: a. Declare the entire then unpaid outstanding balance due under this Note immediately due and payable, and the same shall become due and payable without further demand, protest or further notice of any kind, all of which are expressly waived. Upon such declaration, outstanding principal and (to the extent permitted by law) interest and any other sums outstanding in connection with this Note shall thereafter bear interest at the Default Rate, payable from the date of such declaration until paid in full; b. Take any and all actions and do any and all things which are allowed, permitted or provided by law, in equity or by statute, in the sole discretion of Holder, to collect the amounts then due and thereafter to become due hereunder, to 882/012782-0020 13092704.7 a03/13/19 9565736.3 -3- exercise its rights under the Deed of Trust, and to enforce performance and observance of any obligation, agreement or covenant of Maker under this Note; No remedy herein conferred upon or reserved to Holder is intended to be exclusive of any other available remedy or remedies, but each such remedy shall be cumulative and shall be in addition to every other remedy given under this Note or now existing at law or in equity or by statute; and may be exercised in such number, at such times and in such order as Holder may determine in its sole discretion. No delay or omission to exercise any right or power upon the occurrence of any Event of Default hereunder shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient by Holder. In order to entitle Holder to exercise any right or remedy reserved to it under this Note, no notice shall be required except as expressly provided herein. 12. Agreement to Pay Attorneys' Fees and Expenses. In the event that Holder brings any action or files any proceeding in connection with the enforcement of its rights under this Note or the Deed of Trust, as a consequence of any breach by Maker of its obligations hereunder or thereunder, the prevailing party in such action or proceeding shall be entitled to have its reasonable attorneys' fees and out-of-pocket expenditures paid by the losing party. The attorneys' fees so recovered shall include fees for prosecuting or defending any appeal and shall be awarded for any supplemental proceedings until the final judgment is satisfied in full. In addition to the foregoing award of attorneys' fees, the prevailing party in any lawsuit on this Note or the Deed of Trust shall also be entitled to its reasonable attorneys' fees incurred in any post judgment proceedings to collect or enforce the judgment. In addition to the foregoing, Maker agrees to pay or reimburse Holder, upon demand by Holder, for all costs incurred by Holder in connection with enforcement of this Note or the Deed of Trust, including without limitation, reasonable attorneys' fees and costs, if there shall be filed by or against Maker any proceedings under any federal or state bankruptcy or insolvency laws, whether Holder is a creditor in such proceedings or otherwise. 13. Amendments. This Note may not be modified or amended except by an instrument in writing expressing such intention executed by the parties sought to be bound thereby, which writing must be so firmly attached to this Note so as to become a permanent part thereof. 14. Maker's Waivers. Maker waives any rights to require the Holder to: (a) demand payment of amounts due (known as "presentment"), (b) give notice that amounts due have not been paid (known as "notice of dishonor"), and (c) obtain an official certification of nonpayment (known as "protest"). 15. Notice. Any notice that must be given to Maker under this Note shall be in writing and shall be effective when personally delivered or delivered by reputable overnight courier that provides a receipt with the date and time of delivery, or forty-eight (48) hours after deposit in the United States Mail, as certified or registered mail, return receipt requested, first-class postage and fees prepaid, addressed to Maker at: City of 882/012782-0020 13092704.7 a03/13/19 9565736.3 -4- Poway, 13325 Civic Center Drive, Poway, CA 92064, Attn: City Treasurer, or such other address as Maker shall direct from time to time in writing, and to Holder at Holder's address stated in the preamble to this Note. Failure or delay in giving any notice required hereunder shall not constitute a waiver of any default or late payment, nor shall it change the time for any default or payment. 16. Successors Bound. This Promissory Note shall be binding upon the parties hereto and their respective heirs, successors and assigns. 17. Severability. The invalidity or unenforceability of any one or more provisions of this Note will in no way affect any other provisions. 18. Interpretation. Whenever the context requires, all words used in the singular will be construed to have been used in the plural, and vice versa, and each gender will include any other gender. The captions of the paragraphs of this Note are for convenience only and do not define or limit any terms or provisions. Time is of the essence in the performance of this Note by Maker. Maker has been represented by counsel in the negotiation of this Note, and it shall not be interpreted in favor of or against any party on account of relative responsibilities in drafting. Notwithstanding any other provision of this Note, nothing in this Section 18 or elsewhere in this Note shall be deemed to require Maker to pay interest in an amount in excess of any applicable usury law or other legal limitation on interest, and the terms of this Note shall be interpreted to require in each instance the lesser of (a) the amount stated in this Note, and (b) the maximum applicable legal limit. 19. No Waiver; Consents. Any waiver by Holder must be in writing and will not be construed as a continuing waiver. No waiver will be implied from any delay or failure by Holder to take action on account of any default of Maker. Consent by Holder to any act or omission by Maker will not be construed to be a consent to any other or subsequent act or omission or to waive the requirements for Holder's consent to be obtained in any future or other instance. 20. Governing Law. This Note shall be governed by the internal laws of the State of California without regard to conflict of law principles. [End —Signature Page Follows] 882/012782-0020 13092704.7 a03/13/19 9565736.3 IN WITNESS WHEREOF, Maker has executed this Promissory Note. "Maker" POWAY COMMONS, LLC, a Delaware limited liability company By: Guy anager 882/012782-0020 13092704.7 a03/13/19 9565736.3 -6- Dated: /3rt./ Z �- � Z7Zo Resolution No. 19-013 ATTACHMENT NO. 8 CITY DEED OF TRUST [SEE ATTACHED] 882/012782-0020 i iii27aiii/01/20 March 19, 2019 Item #3.1 10 RECORDING REQUESTED BY: First American Title Company WHEN RECORDED MAIL DOCUMENT TO: City of Poway 13325 Civic Center Drive Attn: City Clerk Poway, CA 92064 Property Address: vacant land, Poway, CA DOC# 2O2OO221516 IIIIIIIIIIIIIIIIIilllllllllllllllll IIIIIIII IIIIIIIIIIIIIillllIII Apr 30, 2020 03:54 PM OFFICIAL RECORDS Ernest J. Dronenburg, Jr., SAN DIEGO COUNTY RECORDER FEES: $0.00 (SB2 Atkins: $0.00) PCOR: N/A PAGES: 14 Space Above This Line for Recorder's Use Only File No.: DTR-5903778 (SK) Deed of Trust with Assignment of Rents Title of Document (x ) Recorded [concurrently] in connection with a transfer of real property subject to the imposition of Documentary Transfer Tax per GC 27388.1 (a) (2). ()Recorded [concurrently] in connection with a transfer of real property that is residential dwelling to an owner - occupier per GC 27388.1 (a) (2). ()Maximum fee of $225 has been reached per GC 27388.1 (a) (1). ()Not related to real property GC 27388.1 (a) (1). ()Transfer of real property subject to the imposition of Documentary Transfer Tax - GC 27388.1 (a)(2) ()Transfer of real property that is a residential dwelling to an owner -occupier - GC 27388.1 (a)(2) ()Exempt from fee under GC 27388.1 due to being recorded in connection with a transaction that was subject to documentary transfer tax which was paid on document recorded as Document No. of Official Records () Exempt from fee under GC 27388.1 due to the maximum fees having been paid on document(s) recorded as Document No. of Official Records ()Exempt from fee under GC 27388.1 due to it being recorded in connection with a transfer of real property that is a residential dwelling to an owner -occupier. The recorded document transferring the dwelling to the owner - occupier was recorded as document No. of Official Records. () Exempt from fee under GC 27388.1 for the following reasons: THIS PAGE ADDED TO PROVIDE EXEMPTION INFORMATION FOR THE BUILDING HOMES AND JOBS ACT FEE (S6-2; AFFORDABLE HOUSING FEE) ($3.00 Additional recording fee applies) First American Title Company Flomebuilder Services Division RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of Poway 13325 Civic Center Drive Poway, California 92064 Attn: City Clerk ' ,r tea` 1• G' I� (Space Above This Line For Recorder's Use) (Exempt From Recording Fees Pursuant To Government Code Section 27383) DEED OF TRUST WITH ASSIGNMENT OF RENTS AND RIDER ATTACHED HERETO NOTE: RIDER ATTACHED TO THIS DEED OF TRUST CONTAINING TERMS INCLUDING SECURITY AGREEMENT AND FIXTURE FILING. This DEED OF TRUST WITH ASSIGNMENT OF RENTS AND RIDER ATTACHED HERETO ("Deed of Trust"), is made ,"\ p� } 2.1 , 2020, between POWAY COMMONS, LLC, a Delaware J limited liability company, herein called TRUSTOR, whose address is 9988 Hibert Street, Suite 210, San Diego, CA 92131, FIRST AMERICAN TITLE INSURANCE COMPANY, a California corporation, herein called TRUSTEE, and CITY OF POWAY, a California municipal corporation, herein called BENEFICIARY. WITNESSETH: That Trustor grants to Trustee in trust, with power of sale, Trustor's estate, dated on or about the date hereof, in that property in the City of Poway, County of San Diego, State of California, described in Exhibit "A" (the "Property"), together with the rents, issues and profits thereof, subject, however, to the right, power and authority hereinafter given to and conferred upon Beneficiary to collect and apply such rents, issues and profits for the purpose of securing (1) payment of the sum of ONE MILLION SEVEN HUNDRED THOUSAND DOLLARS ($1,700,000), with interest thereon according to the terms of a promissory note or notes of even date herewith made by Trustor, payable to order of Beneficiary, and extensions or renewals thereof; (2) the performance of each agreement of Trustor incorporated by reference or contained herein; and (3) payment of additional sums and interest thereon which may hereafter be loaned to Trustor, or its successors or assigns, when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust. To protect the security of this Deed of Trust, and with respect to the Property above described, Trustor expressly makes each and all of the agreements, and adopts and agrees to perform and be bound by each and all of the terms and provisions set forth in subdivision A, and it is mutually agreed that each and all of the terms and provisions set forth in subdivision B of the fictitious deed of trust recorded in Orange County August 17, 1964, and in all other counties August 18, 1964, in the book and at the page 882/012782-0020 13092704.7 a03/13/19 9565740.2 of Official Records in the office of the county recorder of the county where said property is located, noted below opposite the name of such county, namely: COUNTY Alameda Alpine Amador Butte Calaveras Colusa Contra Costa Del Norte El Dorado Fresno Glenn Humboldt Imperial lnyo Kern BOOK 1288 3 133 1330 185 323 4684 101 704 5052 469 801 1189 165 3756 PAGE 556 130-31 438 513 338 391. 1 549 635 623 76 83 701 672 690 COUNTY Kings Lake Lassen Los Angeles Madera Marin Mariposa Mendocino Merced Modoc Mono Monterey Napa Nevada Orange BOOK 858 437 192 T-3878 911 1849 90 667 1660 191 69 357 704 363 7182 PAGE 713 110 367 874 136 122 453 99 753 93 302 239 742 94 18 COUNTY BOOK PAGE COUNTY Placer 1028 379 Sierra Plumas 166 1307 Siskiyou Riverside 3778 347 Solano Sacramento 5039 124 Sonoma San Benito 300 405 Stanislaus San Bernardino 6213 768 Sutter San Francisco A-804 596 Tehama San Joaquin 2855 283 Trinity San Luis Obispo 1311 137 Tulare San Mateo 4778 175 Tuolumne Santa Barbara 2065 881 Ventura Santa Clara 6626 664 Yolo Santa Cruz 1638 607 Yuba Shasta 800 633 San Diego SERIES 5 Book 1964, Page 149774 BOOK 38 506 1287 2067 1970 655 457 108 2530 177 2607 769 398 PAGE 187 762 621 427 56 585 183 595 108 160 237 16 693 shall inure to and bind the parties hereto, with respect to the property above described. Said agreements, terms and provisions contained in said subdivisions A and B (identical in all counties, and printed on pages 3 and 4 hereof) are by the within reference thereto, incorporated herein and made a part of this Deed of Trust for all purposes as fully as if set forth at length herein, and Beneficiary may charge for a statement regarding the obligation secured hereby, provided the charge therefor does not exceed the maximum allowed by law. The undersigned Trustor, requests that a copy of any notice of default and any notice of sale hereunder be mailed to him at his address hereinbefore set forth. SEE RIDERS ATTACHED TO THIS DEED OF TRUST By: POWAY COMM f ' S, LLC, a Dela limi d liabilitycompany p Y By: Guy"s.:ro anager 882/012782-0020 13092704.7 a03/13/19 9565740.2 -2- A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On , before me, r r . , a� , NotaryPublic, personally appeared , if,, ., a/,f- .a who proved to me on the basis of satisfactoryJevidence to be the personsrwhose name(s) ,-is'/are subscribed to the within instrument and acknowledged to me that heshe/the executed the same in his/her/their authorized ca acifi ies) , and that Y p YC, � by ;his/her/their si nature s� -on the instrument the erson s , or the entityupon behalf of r g C.,;) p C) p which the person(s)'acted, executed the instrument. • (insert name and title of the officer) I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature 882/012782-0020 13092704.7 a03/13/19 9565740.2 ANNETTE M. WILKINSON Notary Public - California San Diego County Commission 4 2157324 My Comm. Expires Jul 17, 2020 (Seal DO NOT RECORD The following is a copy of Subdivisions A and B of the fictitious Deed of Trust recorded in each county in California as stated in the foregoing Deed of Trust and incorporated by reference in said Deed of Trust as being a part thereof as if set forth at length therein. A. To protect the security of this Deed of Trust, Trustor agrees: 1) To keep said property in good condition and repair, not to remove or demolish any building thereon; to complete or restore promptly and in a good and workmanlike manner any building which may be constructed, damaged or destroyed thereon and to pay when due all claims for labor performed and materials furnished therefor, to comply with all laws affecting said property or requiring any alterations or improvements to be made thereon; not to commit or permit waste thereof; not to commit, suffer or permit any act upon said property in violation of law; to cultivate, irrigate, fertilize, fumigate, prune and do all other acts which from the character or use of said property may be reasonably necessary, the specific enumerations herein not excluding the general. 2) To provide, maintain and deliver to Beneficiary fire insurance satisfactory to and with loss payable to Beneficiary. The amount collected under any fire or other insurance policy may be applied by Beneficiary upon any indebtedness secured hereby and in such order as Beneficiary may determine, or at the option of Beneficiary the entire amount so collected or any part thereof may be released to Trustor. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. 3) To appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee; and to pay all costs and expenses, including cost of evidence of title and attorney's fees in a reasonable sum, in any such action or proceeding in which Beneficiary or Trustee may appear, and in any suit brought by Beneficiary to foreclose this Deed. 4) To pay: at least ten (10) days before delinquency all taxes and assessments affecting said property, including assessments on appurtenant water stock; when due, all encumbrances, charges and liens, with interest, on said property or any part thereof, which appear to be prior or superior hereto; all costs, fees and expenses of this Trust. Should Trustor fail to make any payment or to do any act as herein provided, then Beneficiary or Trustee, but without obligation so to do and without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may: make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon said property for such purposes; appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee; pay, purchase, contest or compromise any encumbrance, charge or lien which in the judgment of either appears to be prior or superior hereto; and, in exercising any such powers, pay necessary expenses, employ counsel and pay his or her reasonable fees. 5) To pay immediately and without demand all sums so expended by Beneficiary or Trustee, with interest from the date of expenditure at the amount allowed by law in effect at the date hereof, and to pay for any statement provided for by law in effect at the date hereof regarding the obligation secured hereby any amount demanded by the Beneficiary not to exceed the maximum allowed by law at the time when said statement is demanded. B. It is mutually agreed: 1) That any award in connection with any condemnation for public use of or injury to said property or any part thereof is hereby assigned and shall be paid to Beneficiary who may apply or release such moneys received by him in the same manner and with the same effect as above provided for disposition of proceeds of fire or other insurance. 2) That by accepting payment of any sum secured hereby after its due date, Beneficiary does not waive its right either to require prompt payment when due of all other sums so secured or to declare default for failure so to pay. 3) That at any time or from time to time, without liability therefor and without notice, upon written request of Beneficiary and presentation of this Deed and said note for endorsement, and without affecting the personal liability of any person for payment of the indebtedness secured hereby, Trustee may: reconvey any part of said property; consent to the making of any map or plat thereof; join in granting any easement thereon, or join in any extension agreement or any agreement subordinating the lien or charge hereof. 4) That upon written request of Beneficiary stating that all sums secured hereby have been paid, and upon surrender of this Deed and said note to Trustee for cancellation and retention or other disposition as Trustee in its sole discretion may choose and upon payment of its fees, Trustee shall reconvey, without warranty, 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 such reconveyance may be described as "the person or persons legally entitled thereto". 5) That as additional security, Trustor hereby gives to and confers upon Beneficiary the right, power and authority, during the continuance of these Trusts, to collect the rents, issues and profits of said property, reserving unto Trustor the right, prior to any default by Trustor in payment of any indebtedness secured hereby or in the performance of any agreement hereunder, to collect and retain such rents, issues and profits as they become due and payable. Upon any such default (beyond any applicable cure period, and during the continuance of such default), Beneficiary may at any time without notice, either in person, by agent, or be a receiver to be appointed by a court, and without regard to the adequacy of any security for the indebtedness hereby secured, enter upon and take possession of said property or any part thereof, in its own 882/012782-0020 13092704.7 a03/13/19 9565740.2 name sue for or otherwise collect such rents, issues, and profits, including those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including reasonable attomey's fees, upon any indebtedness secured hereby, and in such order as Beneficiary may determine. The entering upon and taking possession of said property, the collecting 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 pursuant to such notice. 6) That upon default by Trustor in payment of any indebtedness secured hereby or in the performance of any agreement hereunder, Beneficiary may declare all sums secured hereby immediately due and payable by delivery to Trustee of written declaration of default and demand for sale and of written notice of default and of election to cause to be sold said property, which notice Trustee shall cause to be filed for record. Beneficiary also shall deposit with Trustee this Deed, said note and all documents evidencing expenditures secured hereby. After the lapse of such time as may then be required by law following the recordation of said notice of default, and notice of sale having been given as then required by law, Trustee, without demand on Trustor, shall sell said property at the time and place fixed by it in said notice of sale, either as a whole or in separate parcels, 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 time of sale. Trustee may postpone sale of all or any portion of said property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement at the time fixed by the preceding postponement. Trustee shall deliver to such purchaser its deed 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 Trustor, Trustee, or Beneficiary as hereinafter defined, may purchase at such sale. After deducting all costs, fees and expenses of Trustee and of this Trust, including cost of evidence of title in connection with sale, Trustee shall apply the proceeds of sale to payment of: all sums expended under the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect at the date hereof; all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled thereto. 7) Beneficiary, or any successor in ownership of any indebtedness secured hereby, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument, executed by the Beneficiary and duly acknowledged and recorded in the office of the recorder of the county or counties where said property is situated shall be conclusive proof of proper substitution of such successor Trustee or Trustees, who shall, without conveyance from the Trustee predecessor, succeed to all its title, estate, rights, powers and duties. Said instrument must contain the name of the original Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed is recorded and the name and address of the new Trustee. 8) That this Deed applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term Beneficiary shall mean the owner and holder, including pledgees, of the note secured hereby, whether or not named as Beneficiary herein. In this Deed, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural. 9) That Trustee accepts this Trust when this Deed, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other Deed of Trust or of any action or proceeding in which Trustor, Beneficiary or Trustee shall be a party unless brought by Trustee. DO NOT RECORD REQUEST FOR FULL RECONVEYANCE TO , TRUSTEE: The undersigned is the legal owner and holder of the note or notes and of all indebtedness secured by the foregoing Deed of Trust. Said note or notes, together with all other indebtedness secured by said Deed of Trust, have been fully paid and satisfied; and you are hereby requested and directed, on payment to you of any sums owing to you under the terms of said Deed of Trust, to cancel said note or notes above mentioned, an all other evidences of indebtedness secured by said Deed of Trust delivered to you herewith, together with the said Deed of Trust, and to reconvey, without warranty, to the parties designated by the terms of said Deed of Trust, all the estate now held by you under the same. Dated Please mail Deed of Trust, Note and Reconveyan_ce to Do Not lose or destroy this Deed of Trust OR THE NOTE which it secures. Both must be delivered to the Trustee for cancellation before reconveyance will be made. 882/012782-0020 13092704.7 a03/13/19 9565740.2 -2- Exhibit A LEGAL DESCRIPTION OF PROPERTY Real property in the City of Poway County of San Diego, State of California, described as follows: PARCEL 1 THE WEST 200.00 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13 HEREIN DESCRIBED; THENCE SOUTH 0° 49' 00" WEST, 614.99 FEET; THENCE SOUTH 89° 08' 30" EAST, 733.99 FEET TO THE SOUTHWEST CORNER OF THAT PORTION OF PROPERTY CONVEYED TO RUDOLPH WALTER MATZ ET AL, ON SEPTEMBER 13, 1956 IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY; THENCE ALONG THE WESTERLY LINE OF THE PROPERTY CONVEYED TO MATZ, NORTH 1 ° 07' 00" EAST, 615.00 FEET TO THE NORTH LINE OF SAID SOUTHWEST QUARTER OF SECTION 13 HEREIN DESCRIBED; THENCE ALONG THE NORTH LINE OF THE SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THE NORTH 50.00 FEET OF THE WEST 200.00 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST. ALSO EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. Page 1 of 4 882/012782-0020 13092704.7 a03/13/19 9565740.2 PARCEL 2 THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE WEST HALF OF THE EASTERLY 266.99 FEET OF THE WESTERLY 466.99 FEET OF THAT PORTION OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO BASE AND MERIDIAN, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO THE UNITED STATES GOVERNMENT SURVEY, APPROVED NOVEMBER 19, 1880, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE OF SAID SOUTHWEST QUARTER SOUTH 00°49' 00" WEST, 614.99 FEET TO THE MOST WESTERLY NORTHWEST CORNER OF LAND DESCRIBED IN DEED TO RUDOLPH WALTER MATZ, ET AL, RECORDED SEPTEMBER 13, 1956, IN BOOK 6255, PAGE 520 OF OFFICIAL RECORDS OF SAID SAN DIEGO COUNTY; THENCE ALONG THE BOUNDARY OF SAID MATZ'S LAND AS FOLLOWS: SOUTH 89° 08' 30" EAST, 733.99 FEET AND NORTH 01 ° 07' 00" EAST, 615.00 FEET TO THE NORTHERLY LINE OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE NORTHERLY LINE OF SAID SOUTHWEST QUARTER, NORTH 89° 08' 30" WEST TO THE POINT OF BEGINNING. EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. Page 2 of 4 882/012782-0020 13092704.7 a03/13/19 9565740.2 PARCEL 3 THE SOUTHERLY 100.00 FEET OF THE NORTHERLY 315.00 FEET OF THE EASTERLY 133.495 FEET OF THE WESTERLY 466.99 FEET OF THE NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, TOWNSHIP 14 SOUTH, RANGE 2 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO OFFICIAL PLAT THEREOF. EXCEPTING THEREFROM THAT PORTION LYING SOUTHERLY OF THE FOLLOWING DESCRIBED LINE: COMMENCING AT THE NORTHWEST CORNER OF THE SOUTHWEST QUARTER OF SAID SECTION 13; THENCE ALONG THE WESTERLY LINE THEREOF SOUTH 01°16'17" WEST, (RECORD SOUTH 00°49'00" WEST), 301.85 FEET TO THE TRUE POINT OF BEGINNING; THENCE LEAVING SAID WESTERLY LINE SOUTH 88°39'00" EAST, 62.70 FEET; THENCE SOUTH 43°39'00" EAST, 4.87 FEET; THENCE SOUTH 88°39'00" EAST, 400.87 FEET TO THE EASTERLY LINE OF THE WESTERLY 466.99 FEET OF SAID NORTHWEST QUARTER OF THE SOUTHWEST QUARTER OF SECTION 13, SAID POINT BEING THE POINT OF TERMINUS. PARCEL 4 THAT PORTION OF PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979, MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE ALONG THE SOUTHERLY LINE OF SAID PARCEL 2 NORTH 89°08'30" WEST, 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 00°51'30" EAST, 0.40 FEET; THENCE PARALLEL WITH THE SOUTHERLY LINE OF SAID PARCEL 2, SOUTH 89°08'30" EAST, 19.80 FEET; THENCE SOUTH 88°59'58" EAST 80.49 FEET TO THE EASTERLY LINE OF SAID PARCEL 2; THENCE ALONG SAID EASTERLY LINE SOUTH 00°49'00" WEST, 0.20 FEET TO THE POINT OF BEGINNING. Page 3 of 4 882/012782-0020 13092704.7 a03/13/19 9565740.2 PARCEL 5 PARCEL 2, IN THE CITY OF POWAY, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, AS SHOWN AT PAGE 8847 OF PARCEL MAPS, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, JUNE 21, 1979. EXCEPTING THAT PORTION DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID PARCEL 2; THENCE WESTERLY ALONG THE SOUTHERLY LINE THEREOF A DISTANCE OF 100.29 FEET; THENCE LEAVING SAID SOUTHERLY LINE NORTH 0°51'30" EAST A DISTANCE OF 0.40 FEET; THENCE SOUTH 89°08'30" EAST PARALLEL WITH SAID SOUTH LINE A DISTANCE OF 19.80 FEET; THENCE SOUTH 88°59'58" EAST 80.49 FEET TO THE INTERSECTION WITH THE EASTERLY LINE OF SAID PARCEL 2; THENCE SOUTHERLY ALONG SAID EASTERLY LINE A DISTANCE OF 0.20 FEET TO THE POINT OF BEGINNING. Page 4 of 4 M:\3345\08\Legal Descriptions\A05 Deed -City to Poway Commons-Comm.docx13092704.9a03/15/19 882/012782-0020 13092704.7 a03/13/19 9565740.2 RIDER TO DEED OF TRUST WITH ASSIGNMENT OF RENTS This RIDER TO DEED OF TRUST WITH ASSIGNMENT OF RENTS ("Rider") is executed this :(-1:2 4 day of ,,—%. r .;/ 2020, by POWAY COMMONS, LLC, a Delaware limited liability company, herein "Trustor," in favor of the CITY OF POWAY, a California municipal corporation, herein "Beneficiary," the same parties to that certain form Deed of Trust With Assignment of Rents, of even date hereto, to which this Rider is attached. This Rider is made a part of and is incorporated into said Deed of Trust. This Rider shall supersede any conflicting term or provision of the form Deed of Trust to which it is attached. Reference is made to that certain Promissory Note executed by Trustor on or about the date set forth above, the repayment of which by Trustor is secured by this Deed of Trust ("City Note") The parties hereto agree: 1. Property. The estate subject to this Deed of Trust is Trustor's fee estate in the real property legally described in the foregoing Deed of Trust to which this Rider is attached (the "Property"). 2. Obligations Secured. Trustor makes this grant and assignment for the purpose of securing the following obligations ("Secured Obligations"): a. Payment to Beneficiary of all indebtedness at any time owing under the terms of the City Note; b. Payment and performance of all obligations of Trustor under this Deed of Trust; c. All modifications, extensions and renewals of any of the obligations secured hereby, however evidenced. 3. Obligations. The term "obligations" is used herein in its broadest and most comprehensive sense and shall be deemed to include, without limitation, all interest and charges, prepayment charges, late charges and fees at any time accruing or assessed on any of the Secured Obligations. 4. Incorporation. All terms of the City Note and the Secured Obligations are incorporated herein by this reference. All persons who may have or acquire an interest in the Property shall be deemed to have notice of the terms of all of the foregoing documents. 5. Mortgagee -in -Possession. Neither the assignment of rents set forth in the Deed of Trust nor the exercise by Beneficiary of any of its rights or remedies hereunder shall be deemed to make Beneficiary a "mortgagee -in -possession" or otherwise liable in any manner with respect to the Property, unless Beneficiary, in person or by agent, assumes actual possession thereof. Nor shall appointment of a receiver for the 882/012782-0020 13092704.7 a03/13/19 9565740.2 Property by any court at the request of Beneficiary or by agreement with Trustor, or the entering into possession of the Property by such receiver, be deemed to make Beneficiary a "mortgagee -in -possession" or otherwise liable in any manner with respect to the Property. 6. No Cure. In the event Beneficiary collects and receives any rents under the Deed of Trust upon any default hereof, such collection or receipt shall in no way constitute a curing of the default, except if and to the extent the same are sufficient to cure all monetary defaults and no other defaults then exist. 7. Possession Upon Default. Upon the occurrence of and during the continuation of a default, Beneficiary, after having given notice and the applicable cure periods having expired with the default having not been cured (hereinafter, a "default"), may, at its option, without any action on its part being required and without in any way waiving such default, take possession of the Property in accordance with applicable law and have, hold, manage, lease and operate the same, on such terms and for such period of time as Beneficiary may deem proper, and may collect and receive all rents and profits, with full power to make, from time to time, all commercially reasonable alterations, renovations, repairs or replacements thereto as may seem proper to Beneficiary, and to apply such rents and profits to the payment of (a) the cost of all such alterations, renovations, repairs and replacements, and all costs and expenses incident to taking and retaining possession of the Property, and the management and operation thereof, and keeping the same properly insured; (b) all taxes, charges, claims, assessments, and any other liens which may be prior in lien or payment of the City Note, and premiums for insurance, with interest on all such items; and (c) the indebtedness secured hereby, together with all costs and attorney's fees, in such order or priority as to any of such items as Beneficiary in its sole discretion may determine, any statute, law, custom or use to the contrary notwithstanding. Any amounts received by Beneficiary or its agents in the performance of any acts prohibited by the terms of this assignment, including, but not limited to, any amounts received in connection with any cancellation, modification or amendment of any lease prohibited by the terms of this assignment and any rents and profits received by Trustor after the occurrence of a default shall be held by Trustor as trustee for Beneficiary and all such amounts shall be accounted for to Beneficiary and shall not be commingled with other funds of the Trustor. Any person receiving any portion of such trust funds shall receive the same in trust for Beneficiary as if such person had actual or constructive notice that such funds were impressed with a trust in accordance therewith. 8. Receiver. In addition to any and all other remedies of Beneficiary set forth under this Deed of Trust or permitted at law or in equity, if a default shall have occurred and not have been cured within any applicable cure period, Beneficiary, to the extent permitted by law and without regard to the value, adequacy or occupancy of the security for the Note and other sums secured hereby, shall be entitled as a matter of right if it so elects to the appointment of a receiver to enter upon and take possession of the Property and to collect all rents and profits and apply the same as the court may direct, and such receiver may be appointed by any court of competent jurisdiction by ex parte application and without notice, notice of hearing being hereby expressly waived. The 882/012782-0020 13092704.7 a03/13/19 9565740.2 expenses, including receiver's fees, attorneys' fees, costs and agent's compensation, incurred pursuant to the power herein contained shall be secured by this Deed of Trust. 9. Notice to Beneficiary. Notices to Beneficiary shall be sent to Beneficiary addressed to: City of Poway 13325 Civic Center Drive Poway, CA 92064 Attn: City Clerk [End —Signature page follows] 882/012782-0020 13092704.7 a03/13/19 9565740.2 IN WITNESS WHEREOF, Trustor has executed this Rider on the date of Trustor's acknowledgment herein below, to be effective for all purposes as of the day and year first set forth above. POWAY COMMONS, LLC, a Delaware limited liability .. pan Dated: I/2 f Z , 2020 By: manager 882/012782-0020 13092704.7 a03/13/19 9565740.2 Resolution No. 19-013 ATTACHMENT NO. 9 PROJECT BUDGET Poway Commons, LLC Preliminary Project Cost Budget I. Project Description Site Area Average Unit Size Number of Units Future Retail Pads 9.30 Acres 1,721 SF 98 Units 2.30 Acres II. Development Costs A. Direct Costs Site Improvements $6,451,000 Direct Vertical Construction $20,100,034 Other/Contingency $2,340,260 Total Direct Costs $28,891,294 B. Indirect Costs Engineering $1,092,000 Permits & Fees $2,205,000 Other Soft Costs (Prop Tax, Title, Escrow, Bonding) $1,335,667 G&A $2,376,340 Selling & Marketing Costs $5,391,933 Other Indirects $950,000 Total Indirect Costs $13,350,939 C. Financing Costs $2,233,416 D. Developer Land Cost $8,300,000 E. Total Development Costs $52,775,649 *These are preliminary budget estimates based on preliminary site plans. Subject to change with entitlement, project conditions and approved plans. 882/012782-0020 l OT �L�/01/20 March 19, 2019 Item #3.1 Resolution No. 19-013 882/012782-0020 37 t520T iL5/01/20 ATTACHMENT NO. 10 FORM OF RELEASE OF CONSTRUCTION COVENANTS [SEE ATTACHED] March 19, 2019 Item #3.1 Resolution No. 19-013 Page 102 RECORDING REQUESTED BY: AND WHEN RECORDED MAIL TO: (Space above for Recorder's Use Only) CITY OF POWAY RELEASE OF CONSTRUCTION COVENANTS A. POWAY COMMONS, LLC, a Delaware limited liability company ("Developer"), is the owner of fee title to that certain real property legally described in Exhibit "A" attached hereto and incorporated herein by reference (the "Site"); and B. By a Purchase, Sale, and Development Agreement (hereinafter referred to as the "Agreement") dated , 2019, by and between Developer and the City of Poway, a California municipal corporation ("City"), the Developer has redeveloped the Site in accordance with the Agreement; and C. Pursuant to Section 5.13 of the Agreement, promptly after Developer's completion of the "Project" (as that term is defined in the Agreement) upon the Site, and upon request by Developer, City shall furnish Developer with a Release of Construction Covenants in such form as to permit it to be recorded in the Official Records of the County of San Diego; and D. The issuance by City of the Release of Construction Covenants shall be conclusive evidence that Developer has complied with the terms of the Agreement pertaining to the development of the Site; and E. Developer has requested that City furnish Developer with the Release of Construction Covenants; and F. City has conclusively determined that the development of the Site has been satisfactorily completed as required by the Agreement. NOW, THEREFORE: 1. As provided in the Agreement, City does hereby certify that development of the Site has been fully and satisfactorily performed and completed, and that such development is in full compliance with said Agreement. 882/012782-0020 13092704.9 a03/21 /19 Resolution No. 19-013 Page 103 2. This Release of Construction Covenants shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance construction work on the Site, or any part thereof. 3. This Release of Construction Covenants is not a Notice of Completion as referred to in California Civil Code Section 3093. 4. Except as stated herein, nothing contained in this instrument shall modify in any way any other provisions of the Agreement or any other provisions of any agreements or documents referenced therein. IN WITNESS WHEREOF, City has executed this Release of Construction Covenants as of this day of , 20 . 882/012782-0020 13092704.9 a03/21/19 City Manager, City of Poway ATTEST: City Clerk, City of Poway -2- Resolution No. 19-013 Page 104 A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. before me, (insert name and title of the officer) , I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. before me, (insert name and title of the officer) , I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature (Seal) 882/012782-0020 13092704.9 a03/21/19 Resolution No. 19-013 Page 105 EXHIBIT "A" LEGAL DESCRIPTION OF PROPERTY Real property in the City of Poway, County of San Diego, State of California, described as follows: 882/012782-0020 13092704.9 a03/21/19 EXHIBIT "A" Resolution No. 19-013 DEPICTION OF CITY EXCHANGE PROPERTY AND AUTHORITY EXCHANGE PROPERTY Future City FErcels Future Airdab! e Site