04-0907_PUEBLO SERRA WORSHIP HOLDINGS_Development AgreementRecorded in Offici Records, Orange County
Tom Daly, Clerk -Recorder
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Recording Requested by And When Recorded Return to:
Meg Monahan
City Clerk
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, Ca. 92675 n
[Exempt From Recording Fees-G.C. 6103]
DEVELOPMENT AGREEMENT
(Assessor's Parcel #649-361-03;
649-011-025; 649-011-30, County
of Orange, California)
This Development Agreement is made this `day of004, by
and between the City of San Juan Capistrano ("City') and PueGbIoCterra Worship
Holdings, a California not for profit religious corporation ("Developer"). The City
and Developer are also referred to as "Parties" and individually as a "Party".
RECITALS
Whereas, Developer owns in fee simple title approximately 9 acres of real
property adjacent to, and east of, Camino Capistrano and northerly of Junipero
Serra Road and designated as Orange County Assessor's Parcel # 649-361-03.
Developer currently has a vested leasehold interest in approximately 29 acres of
unimproved real property southerly of Junipero Serra Road and designated as
Orange County Assessor's Parcel # 649-011-025, & 649-011-30. All three above
stated parcels are collectively referred to herein as the "Subject Property", and
Whereas, Assessor's Parcel # 649-361-03 is commonly referred to as the
"north campus" and Assessor's Parcels # 649-011-025 & 649-011-30 are
commonly referred to as the "south campus", and
Whereas, on or about July 25, 2002, citizens of San Juan Capistrano
commenced circulation of the "JSerra Education Initiative" which is hereby
expressly incorporated by this reference as if set forth in full ("the Initiative"), and
Whereas, the City Council on May 19, 2003 adopted the Initiative
pursuant to the requirements of the state Elections Code, and
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Whereas, on June 30, 2004, the California Court of Appeal, in Native
American Sacred Site and Environmental Protection Association v. City of San
Juan Capistrano (Case. No. G033198) affirmed that the City's adoption of the
Initiative on May 19, 2003 was lawful; and
Whereas, the Initiative contains General Plan and zoning regulations that
allow the previously -entitled structures on the north campus to be used as a
private Catholic high school and also allow the development of supporting school
facilities on the south campus, and
Whereas, construction of improvements on the south campus parcels as
applied for by Developer entail Architectural Control land use approvals from the
City, and
Whereas, the Parties agree that this Agreement will promote and
encourage the development of the Subject Property by providing the Developer,
and its successors, assigns, and lenders, with a greater degree of certainty as to
the Developer's ability to complete the Project, and that the consideration to be
received by the City pursuant to this Agreement and the rights secured to
Developer hereunder constitute sufficient consideration to support the covenants
and agreements of the Parties, and
Whereas, the Agreement provides a mechanism by which the City can
obtain valuable public revenues which will assist in the long-standing, desired
economic development of the Subject Property and which will offset costs for City
services such as police, fire, and recreational services, while at the same time
ensuring the prompt processing of applications for the development and
operation of a Catholic high school on the Subject Property; and
Whereas, the City has processed, considered, and approved an
environmental impact report that has fully analyzed the environmental impacts of
the project
NOW, THEREFORE, City and Developer mutually agree as follows:
ARTICLE 1. General Provisions.
1.1 Ownership of the Property. The City and Developer
acknowledge and agree that Developer has the requisite legal or
equitable interest in the Subject Property, and thus, Developer is
qualified to enter into and be a party to this Agreement in
accordance with Government Code section 65865(b).
1.2 Assignment of Rights. Developer shall be permitted to assign or
otherwise transfer this Agreement, and its rights and obligations
hereunder, to any other person, firm or entity, but only if the prior
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written consent of the City or the City's delegate is obtained. Such
consent of the City shall not be unreasonably withheld.
Notwithstanding any other provisions in this Agreement (including,
but not limited to, the previous two sentences), Developer or its
successors in interest may assign or otherwise transfer this
Agreement and its rights and obligations hereunder to any entity or
entities owned or controlled either directly or indirectly by Junipero
Serra High School, a California non-profit religious corporation
("JSerra High School") (each such entity being a "Permitted
Transferee"). Assignments or transfers of the Agreement, or rights
or obligations thereunder, to a Permitted Transferee do not require
the prior written consent of the City, such consent being
affirmatively given herein. As used in this subsection "owned or
controlled by" means an entity in which JSerra High School has
either a direct or indirect equitable or beneficial ownership interest
equal to at least 25% or an amount sufficient to exercise control, or
a limited liability company in which Timothy R. Busch or an entity
controlled by Timothy R. Busch serves as a managing member.
The provisions of this Agreement shall be binding upon and shall
inure to the benefit of the Parties and their respective successors
and assigns. To the extent of the interest of the Developer, and its
assigns, in the Subject Property, the covenants of Developer set
forth in this Agreement shall be covenants running with the land
and enforceable to the full extent permitted by applicable law.
1.3 Term. Unless otherwise terminated as provided in this Agreement
or otherwise provided, this Agreement shall continue in full force
and effect for a period of 20 years from its effective date.
ARTICLE 2. Development of the Property.
2.1 Vested Right to Develop. Pursuant to Government Code sections
65865.4 and 65866, Developer is obtaining vested rights to develop
the Subject Property in accordance with applicable General Plan
and zoning regulations, as amended by the Initiative, the terms of
this Agreement, and Architectural Approval (AC) 02-07. Unless
amended or terminated in the manner specified in this Agreement
(and subject to the provisions of this Agreement), Developer shall
have the rights and benefits afforded by this Agreement and this
Agreement shall be enforceable by Developer and the City
notwithstanding any growth control measure or any development
moratorium adopted after the Execution Date, or any change in
applicable general or specific plans, zoning, or subdivision
regulation adopted by the City which alter or amend the City's
General Plan or Zoning Code or effect a change to City policies that
prevent or materially adversely affect development of the Project as
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contemplated by this Agreement and Architectural Approval (AC)
02-07. Developer agrees to comply with all conditions of approval
imposed on the project through City's adoption of Architectural
Approval (AC) 02-07.
2.2 Permitted Uses. (a) Unless otherwise provided by this Agreement,
the land use rules, regulations and official policies governing the
permitted uses of the Subject Property, governing density, design,
improvement, and construction standards and specifications,
applicable to development of the property shall be those rules,
regulations, and official policies set forth in the Initiative, the
Architectural Approval, and the land use rules, regulations, and
official policies in force at the time of the execution of the
agreement. Pursuant to Government Code section 65866, the City
in subsequent land use actions applicable to the Property may
apply new rules, regulations, and policies which do not conflict with
those rules, regulations, and policies which are applicable to the
Subject Property. (b) In addition, at no time shall the student
population of the school exceed 2,000 full time equivalent students.
Full time equivalent students does not include individuals who are
not enrolled in the school and who attend after school programs at
the school facilities. (c) Performing Arts Center. Developer
intends to propose a Performing Arts Center on the South Campus
at a future point in time. Developer may apply for an exception to
the City's 35 foot height rule as part of an architectural control
("AC") application by filing an exception request with the AC
application. The following criteria shall apply in the Planning
Commission's determination of whether to grant a height limitation
exception: (1) whether the design and layout of the structure is
compatible with surrounding land uses; (2) whether the general
design considerations, including the character, scale, and quality of
the design are consistent with the City's Design Guidelines; (3)
whether the design and layout would pose significant impairment of
view sheds; (4) whether Developer has demonstrated that feasible
design solutions have been studied such that the specific height
proposed represents the only feasible means available to construct
the proposed structure. (d) If any provision of the City's Title 9
Zoning regulations otherwise applicable to the South Campus
project is found to be in conflict with the Architectural Control
approval for the South Campus or the terms of this Development
Agreement, then the Architectural Control approval and the
Development Agreement shall control and supercede the conflicting
provisions in the City's Zoning Regulations,
2.3 Future Developer Requested Land Uses Changes. Developer
shall not be entitled to any change, modification, revision or
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alteration in applicable General Plan and zoning regulations or
Architectural Control (AC) 02-07 without review and approval by the
City in accordance with City's Municipal Code requirements as they
relate to modification of such land use entitlement requirements.
2.4 Future Voter Actions. Notwithstanding any other provision of this
Agreement to the contrary, any general plan amendment, zoning
ordinance or regulation, or any other law, policy, or procedure
adopted by the voters of the City after the Execution Date of this
Agreement shall not apply, in whole or in part, to the Subject
Property or the JSerra High School project, unless such voter
approved amendments expressly further the development of the
Subject Property for the JSerra High School Project. Additionally,
because the Supreme Court held in Pardee Construction Co. v.
City of Camarillo (1984) 37 Cal.3d 465 that the failure of the parties
therein to provide for the timing of development permitted a later
enacted ordinance restricting the timing of development, it is the
intent of the Developer and the City to hereby acknowledge and
provide a right for the Developer to develop the Project in such an
order and at such rate and time as Developer deems appropriate
within the exercise of its sole and subjective business judgment.
2.5 Reservation of Authority/Exceptions. Notwithstanding any other
provision of this Agreement, the following additional subsequent
land use regulations shall apply to the development of the Subject
Property:
(a) Processing fees and charges of every kind and nature
imposed or enacted by the City to cover the estimated actual
costs to the City of processing applications for land use
approvals or for monitoring compliance with applicable land
use approvals;
(b) Procedural regulations consistent with this Agreement
relating to hearing bodies, applications, notices, findings,
records, hearing, reports, recommendations, appeals and
any other matter of procedure;
(c) Changes adopted by the International Conference of
Building Officials, or other similar body, as part of the then
most current versions of the Uniform Building Code, Uniform
Fire Code, Uniform Plumbing Code, Uniform Mechanical
Code, National Electrical Code, or Dangerous Building
Code.
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(d) Regulations that are in conflict with Developer's Project
provided Developer has given written consent to the
application of such regulations to the Subject Property.
(e) (e) Federal, state, county, and multi -jurisdictional laws and
regulations which the City is required to enforce as against
the Subject Property or development of the Subject Property.
(f) Utility connection fees which would ordinarily be required to
be paid by Developer.
(g) Regulations that do not apply to the development of the
Subject Property but to future potential temporary uses such
as temporary use permits.
2.6 Modification or Suspension by Federal, State, County, or Multi -
Jurisdictional law. In the event that federal, state, county, or
multi -jurisdictional laws or regulations, enacted after the effective
date of this Agreement, prevent or preclude compliance with one or
more of the provisions of this Agreement, such provisions of this
Agreement shall be modified or suspended as may be necessary to
comply with such federal, state, county, or multi -jurisdictional laws
or regulations, and this Agreement shall remain in full force and
effect to the extent it is not inconsistent with such laws or
regulations and to the extent such laws or regulations do not render
such remaining provision impractical to enforce.
ARTICLE 3. PUBLIC BENEFITS
3.1 General. The Parties acknowledge and agree that Developer's
Project will result in demands on public services and further
acknowledge and agree that this Agreement confers unique
benefits to Developer that can be balanced by the provision of
public benefits to the City. Accordingly, the Parties intend by this
Agreement to provide additional consideration to the public that
exceeds the costs attributed to the demands on public services
created by the project.
3.2 Per Student Fee Imposition. Developer shall make payments to
the City as follows:
3.2.1 For the school year commencing September 1, 2005 through
August 31, 2006, Developer shall pay City a single Per
Student Mitigation Fee of One Hundred Seventy -Two
Thousand Dollars ($172,000).
3.2.2 For the school years commencing September 1, 2006
through August 31, 2007 and each school year thereafter for
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the duration of this Agreement, Developer shall pay the City
an annual fee ("Per Student Mitigation Fee") equal to Two
Hundred Dollars ($200) per student enrolled in the regular
full time curriculum at the School as of October 1, but in any
event not less than Two Hundred Thousand Dollars
($200,000) per school year. As an example, if during the
September 1, 2006 through August 31, 2007 school year,
Developer has a student enrollment of 500 students,
Developer shall pay the City $200,000 to cover the annual
payment for that school year ($200 x 500= $100,000, which
is less than $200,000). If, however, during this same school
year, Developer has a student enrollment of 2,000 students,
Developer shall pay the City Four Hundred thousand Dollars
($400,000) for that school year ($200 x 2,000= $400,000).
3.2.3 In addition to the above provisions, commencing the third
year the Per Student Mitigation Fee (initially at $200 per
student) is to be paid by Developer pursuant to Section
3.2.2, the Per Student Mitigation Fee shall be increased two
percent (2%) per year (on original base amount).
3.2.4 The Parties expressly acknowledge that at this point in time,
it is unclear whether the Subject Property will be deemed by
the applicable authority to be exempt from the payment of
real property taxes. To this end, notwithstanding any of the
provisions of this Agreement, if the Subject Property is not
deemed to be tax exempt in its entirety, Developer shall
continue to be obligated to pay the annual Per Student
Mitigation Fee set forth above, but the amount due shall be
reduced by an amount equal to the sum of (1) the gross real
property taxes and assessments attributable to the Subject
Property that is allocated to (a) the City, (b) City -controlled
special districts, and (c) other City -controlled taxing entities,
and (2) the gross property tax increment attributable to the
Subject Property allocated to the Community
Redevelopment Agency of the City pursuant to Health and
Safety Code section 33670(b) or successor statute
(collectively, the "City/Agency Property Tax Allocation"). The
City/Agency Property Tax Allocation shall not include the
diversion of all or a portion of City or Agency property tax
receipts attributable to the Subject Property to the
Educational Revenue Augmentation Fund, but shall include
all other tax amounts attributable to the Subject Property
which would otherwise be received by the City or Agency but
for the other acts of the County of Orange, State of
California, or federal government. If the Per Student
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Mitigation Fee is less than zero (e.g., City/Agency Property
Tax Allocation exceeds the Per Student Mitigation Fee owed
for a particular year), Developer shall not be obligated to
make any Per Student Mitigation Fee Payment for that
school year and the amount less than zero shall be carried
over to the following year and added to the City/Agency
Property Tax Allocation for the following year. The
City/Agency Property Tax Allocation is determined on the
basis of a July 1 to June 30 fiscal year. The City/Agency
Property Tax Allocation for a particular fiscal year shall
correspond to the school year falling principally within the
fiscal year (e.g., the City/Agency Property Tax Allocation for
the period July 1, 2005 to June 30, 2006, shall apply to the
school year falling September 1, 2005 to August 31, 2006).
3.2.5 Notwithstanding the provisions of Sections 3.2.1 through
3.2.4 above, the Per Student Mitigation Fee shall never
exceed, per fiscal year, that amount equal to the City/Agency
Property Tax Allocation the City, City -controlled special
districts, other City controlled taxing entities, and the
Community Redevelopment Agency of the City of San Juan
Capistrano would have received if the Subject Property was
not deemed to be tax exempt. The parties expressly agree
that the purpose of this provision is to ensure that no party
obtains a financial windfall.
3.2.6 Timing of Payment. Developer shall be obligated to make
the Per Student Mitigation Fee for the school year falling
principally within the corresponding fiscal year and such
payment shall be made within sixty (60) days after such
fiscal year ending June 30, subject to notification of
Developer of the amount due, if applicable.
3.2.7 Interest Penalty for Late Payments. If Developer fails to
make a payment of the Per Student Mitigation Fee to the
City (if required when the credit for the City/Agency Property
Tax Allocation is applied) within four (4) weeks from delivery
of written notice from the City setting forth the amount of the
Per Student Mitigation Fee due for such year, then a penalty
at the rate of the Prime Rate plus three percent (3%) per
annum shall be applied to the payment. For purposes of this
section, the applicable Prime Rate shall be published in the
Wall Street Journal on the 15th day of the prior month (or
preceding business day if the 15th day is not a business
day).
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3.2.8 Reconciliation of Per Student Mitigation Fee Payments.
The Parties hereby expressly acknowledge and agree that
the Per Student Mitigation Fee Payments may need to be
reconciled on a yearly basis to ensure effectuation of and
adherence to the Parties' intentions as expressed in this
Article. To this end, the Parties agree to create a
mechanism by which to ensure that no overpayments or
underpayments of the Per Student Mitigation Fee Payments
are made.
3.2.9 Security. If Developer fails to make a Per Student
Mitigation Fee payment to the City (if required when the
credit for the City/Agency Tax Allocation is applied) within
four (4) weeks from delivery of written notice from the City
setting forth the amount due, Developer shall be required to
provide immediate payment of the amount in arrears and
shall also be required to immediately deposit with City, to be
held in trust in a separate, segregated fund, $200,000 to
cover one year's worth of a Per Student Mitigation Fee
Payment. This amount held in trust shall not be expended
by the City for any purpose, and shall be held as security for
Developer's obligations set forth herein. The $200,000
security shall be held in an interest bearing account to be
mutually agreed upon by Developer and the City, with
interest bearing on the account to be payable to the
Developer on January 31 of every year.
3.2.10 Audit. City at its discretion is entitled to request and
Developer shall cooperate with a third party audit of school
records pertaining to the student fee obligation.
3.3 Joint Public Use of Project Facilities. Developer and City agree
to enter into a memorandum of understanding for the joint use of
certain designated portions of the south campus facilities by the
City. The Parties acknowledge that the "Joint Facilities Use
Agreement", dated April 22, 1996, between the City and the
Capistrano Unified School District will serve as a model of the
memorandum of understanding to be entered into between the City
and Developer pursuant to this Section.
3.4 Financial Aid for, and Outreach to, City Children. Developer
agrees to designate a portion of its financial aid program
exclusively for children of City residents. A committee made up of
local individuals (e.g., a Councilmember, Developer representative,
cultural commission member, etc.) will distribute awards. Such
awards shall be reviewed and approved by JSerra's financial aid
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committee. Developer also shall adopt a proactive outreach
program to attract students from the City focusing particularly on
the economically distressed areas of the City.
3.5 Commitment to On -Site Private Security. Developer agrees to
provide private, 24-hour security at the School utilizing a
combination of electronic monitoring systems and patrols.
3.6 Traffic Mitigation Obligation. Developer shall perform certain
traffic impact mitigation activities more particularly set forth in
Exhibit A, attached and incorporated herein by reference, under the
terms and conditions as set forth in Exhibit A.
ARTICLE 4. REVIEW FOR COMPLIANCE
4.1 Periodic Review. The City Council shall review this Agreement
annually, on or before the anniversary of the Effective Date, in
order to ascertain the good faith compliance by Developer, with the
terms of the Agreement. As part of that review, Developer shall
submit an annual monitoring review statement describing its actions
in compliance with the Agreement, in a form acceptable to the City
Manager or his/her authorized designee, within thirty (30) days after
written notice therefrom requesting such a statement. The
statement shall be accompanied by an annual review and
administration fee sufficient to defray the estimated costs of review
and administration of the Agreement during the succeeding year.
The amount of the annual review and administration fee shall be
the actual costs incurred by City as determined by the City
Manager, but not to exceed $1,000 without the express prior
approval of the Developer. No failure on the part of the City to
conduct or complete the review as provided herein shall have any
impact on the validity of this Agreement.
4.2 Special Review. The City Council may, in its sole and absolute
discretion, order a special review of compliance with this
Agreement at any time at City's sole cost. Developer shall
cooperate with the City in the conduct of such special reviews.
4.3 Procedure. Each Party shall have a reasonable opportunity to
assert matters which it believes have not been undertaken in
accordance wit the Agreement, to explain the basis for such
assertion, to receive from the other Party a justification of is position
on such matters.
4.3.1 If on the basis of the Parties' review of any terms of the
Agreement, either Party concludes that the other Party has
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not complied in good faith with the terms of the Agreement,
then such Party may issue a written "Notice of Non -
Compliance" specifying the grounds therefore and all facts
demonstrating such non-compliance.
4.3.2 The Party receiving a Notice of Non -Compliance shall have
thirty (30) days to cure or remedy the non-compliance
identified in the Notice of Compliance, or if such cure or
remedy is not reasonably capable of being cured or
remedied with such thirty (30) days period, to commence to
cure or remedy the non-compliance and to diligently and in
good faith prosecute such cure or remedy to completion.
4.3.3 If the Party receiving the Notice of Non -Compliance does not
believe it is out of compliance and contests the Notice, it
shall do so by responding in writing to said Notice within ten
(10) calendar days after receipt of the Notice.
4.3.4 If the response to the Notice of Non -Compliance has not
been received in the offices of the Party alleging the non-
compliance within the prescribed time period, the Notice of
Non -Compliance shall be presumed to be valid unless good
cause exists for not responding within the time period.
4.3.5 If a Notice of Non -Compliance is contested, the Parties shall,
for a period of not less than fifteen (15) days following
receipt of the response, seek to arrive at a mutually
acceptable resolution of the matter(s) occasioning the
Notice. In the event that a cure or remedy is not timely
effected or, if the Notice is contested and the Parties are not
able to arrive at a mutually acceptable resolution of the
matter(s) by the end of the fifteen (15) day period, the party
alleging the non-compliance may thereupon pursue the
remedies provided in Section 5.4 of this Agreement.
4.3.6 Neither Party hereto shall be deemed in breach if the reason
for noncompliance is due to a "force majeure" as defined in,
and subject to the provisions of Section 10.7 below.
4.4 Certificate of Agreement Compliance. If, at the conclusion of a
periodic or special review, Developer is found to be in compliance
with this Agreement, City shall, upon request by Developer, issue a
Certificate of Agreement Compliance ("Certificate") to Developer
stating that after the most recent Periodic or Special Review and
based upon the information known or made known to the City
Council that (1) this Agreement remains in effect and that (2)
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Developer is in compliance. The Certificate, whether issued after a
Periodic or Special Review, may be in recordable form if required,
shall contain information necessary to communicate constructive
record notice of the finding of compliance, and shall state that the
Certificate expires upon the earlier of (i) one (1) year form the date
thereof, or (ii) the date of recordation of a Notice of Termination of
Development Agreement. Additionally, Developer may at any time
request from the City a Certificate stating, in addition to the
foregoing, which obligations under this Agreement have been fully
satisfied with respect to the Subject Property, or any lot or parcel
within the Subject Property. Developer may record the Certificate
with the County Recorder. If City does not expressly issue a
Certificate, or expressly decline to issue a Certificate within 15
calendar days of after the conclusion of the periodic or special
review, a Certificate shall be deemed to have been provided to
Developer.
ARTICLES. TERMINATION/DEFAULT AND REMEDIES
5.1 Termination for Default by Developer. The City may terminate
this Agreement for any failure of Developer to perform any of its
material duties or obligations hereunder to comply in good faith with
the terms of this Agreement (hereinafter referred to as "default" or
"breach"); provided, however, the City may terminate this
Agreement pursuant to this Section only after following the
procedure set forth in Section 4.3.
5.2 Termination of Agreement for Default of City. Developer may
terminate this Agreement pursuant to this Section only after
following the procedure set forth in Section 4.3 and thereafter
providing written notice by Pueblo Serra to the City of the default
setting forth the nature of the default and the actions, if any,
required by the City to cure such default and, where the default can
be cured, the failure of the City to cure such default within thirty (30)
days after the effective date of such notice or, in the event that such
default cannot be cured within such thirty (30) day period, the
failure of the City to commence to cure such default within such
thirty (30) day period and to diligently proceed to complete such
actions and to cure such default.
5.3 Rights and Duties Following Termination. Upon the termination
of this Agreement, no Party shall have any further right or obligation
hereunder except with respect to (i) any obligations to have been
performed prior to said termination, or (ii) any material default in the
performance of the provisions of this Agreement which has
occurred prior to said termination.
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5.4 Dispute Resolution by Binding Arbitration. Subject to the notice
of default and opportunity to cure under Section 4.3, all disputes,
claims, and questions regarding the rights and obligations of the
Parties under the terms of this Agreement shall be resolved by
binding arbitration.
In case of a dispute, either party may make a demand for
Arbitration by filing such demand in writing with the other party
within ten (10) days after the notice of default and cure process has
been exhausted.
The arbitrator shall be mutually selected by the Parties. In the
event that the Parties cannot agree on an arbitrator within ten (10)
days, then one or both Parties shall file a written request with the
Judicial Arbitration and Mediation Service ("JAMS") for a list of nine
(9) potential arbitrators. Upon receipt of such list, the Parties shall
promptly conduct a strike -off of unacceptable names. A coin toss
shall be initially conducted to determine which Party shall strike off
the first name.
Once the arbitrator is chosen, the Parties immediately shall
forthwith request JAMS to set an arbitration hearing not later than
120 days from date of the arbitration request. Costs of the
arbitration proceeding shall be shared equally.
5.5 Surety Bond. Nothing in this Article shall prevent City from making
a demand on the surety bond for untimely performance of the traffic
mitigation measures set forth in Exhibit A provided the provisions of
section 4.3 have been complied with.
ARTICLE 6. THIRD PARTY LITIGATION
The City shall promptly notify Developer of any claim, action, or
proceeding filed and served against the City to challenge, set aside, void, annul,
limit or restrict the approval and continued implementation and enforcement of
this Agreement. Developer agrees to fully defend and indemnify the City for all
costs of defense and/or judgment obtained in any such action or proceeding.
Developer shall assume the obligation of providing a legal defense in such
litigation, including the choice of defense legal counsel, unless otherwise
provided for by mutual stipulation of the Parties.
ARTICLE 7. MORTGAGEE PROTECTION
7.1 The Parties hereto agree that this Agreement shall not prevent or
limit Pueblo Serra, in any manner, at Pueblo Serra's sole discretion,
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from encumbering the Subject, Property or any portion thereof or
any improvement thereon by any mortgage, deed of trust or other
security device securing financing with respect to the Subject
Property. The City acknowledges that the lenders providing such
financing may require certain Agreement interpretations and
modifications and agrees upon request, from time to time, to meet
with Pueblo Sera and representatives of such lenders to negotiate
in good faith any such request for interpretation or modification.
Subject to compliance with applicable laws, the City will not
unreasonably withhold its consent to any such requested
interpretation or modification provided the City determine such
interpretation or modification is consistent wit the intent and
purposes of this Agreement.
7.2 Any Mortgagee of the Subject Property shall be entitled to the
following rights and privileges:
(a) Neither entering into this Agreement nor a breach of this
Agreement shall defeat, render invalid, diminish or impair the
lien of any mortgage on the Subject Property made in good
faith and for value, unless otherwise required by law.
(b) The Mortgagee of any mortgage or deed of trust
encumbering the Subject Property, or any part thereof, which
Mortgagee has submitted a request in writing to the City in
the manner specified herein for giving notices, shall be
entitle to receive written notification from the City of any
default by Pueblo Serra in the performance of Pueblo
Serra's obligations under this Agreement.
(c) If the City timely receives a request from a Mortgagee
requesting a copy of any notice of default given to Pueblo
Serra under the terms of this Agreement, the City shall make
a good faith effort to provide a copy of that notice to the
Mortgagee within ten (10) days of sending the notice of
default to Pueblo Serra. The Mortgagee shall have the right,
but not the obligation, to cure the default during the period
that is the longer of (i) the remaining cure period allowed
such Party under this Agreement or (ii) thirty (30) days.
(d) Any Mortgagee who comes in to possession of the Subject
Property, or any part thereof, pursuant to foreclosure of the
mortgage or deed of trust, or deed in lieu of such
foreclosure, shall take the Subject Property, or party thereof,
subject to the terms of this Agreement. Notwithstanding any
other provision of this Agreement to the contrary, no
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Mortgagee shall have an obligation or duty under this
Agreement to perform any of Pueblo Serra's obligations or
other affirmative covenants of Pueblo Serra hereunder, or to
guarantee such performance; except that (i) to the extent
that any covenant to be performed by Pueblo Serra is a
condition precedent to the performance of a covenant by the
City, the performance thereof shall continue to be a condition
precedent to the City's performance hereunder, and (ii) in
the event any Mortgagee seeks to develop or use any
portion of the Property acquired by such Mortgagee by
foreclosure, deed of trust or deed in lieu of foreclosure, such
Mortgagee shall strictly comply with all of the terms,
conditions and requirements of this Agreement and the
Development Plan applicable to the Subject Property or
such part thereof so acquired by the Mortgagee.
ARTICLE 8. INSURANCE
Developer shall submit within 30 days from date of adoption of the
ordinance approving this Development Agreement to the City duplicate originals
of policies and endorsements, or appropriate certificates of insurance, of public
liability insurance and broad form property damage insurance policies in the
amount of not less than Two Million Dollars ($2,000,000), combined single limits,
for death and injury to any person and property damage, naming the City and its
officers, officials, employees, agents, and representatives as additional insureds,
and in addition all such insurance:
(a) shall be primary insurance and not contributory with any
other insurance the City or its officers, officials, employees,
agents, and representatives may have;
(b) shall contain no special limitations on the scope of protection
affordable to the City and its officers, officials, employees,
agents, and representatives;
(c) shall be "date of occurrence" and not "claims -made"
insurance;
(d) shall apply separately to each insured against whom claim is
made or suit is brought, except with the respect to the limits
of the insurer's liability;
(e) shall provide that the policy shall not be canceled by the
insurer or Developer unless there is a minimum of ninety
(90) days prior written notice to the City;
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2304hCity of SJC/Development Agr betw PSWH and City CL 15
(f) shall be endorsed to include a waiver of subrogation rights
against the City or its officers, Officials, employees, agents,
and representatives; and
(g) shall otherwise be in a form acceptable to the Office of the
City Attorney.
ARTICLE 9.
Developer agrees to and shall indemnify, defend, and hold harmless the
City and the City's officers, officials, members, employees, agents, and
representatives, from and against any and all claims, liabilities, damages, and
losses, including without limitation reasonable attorneys' fees and litigation
expenses, including court, courts and expert witness fees (collectively, "Claims")
arising out of City's approval of land use entitlements for Developer's project and
this development agreement; or due to the death or personal injury of any
person, or physical damage to any person's real or personal property, caused by
construction of improvements by, or construction -related activities of, Developer
or Developer's employees, agents, representatives, servants, invitees,
consultants, contractors, or subcontractors (collectively, "Developer's
Representatives") on the Property, or for any construction defects in any
improvements constructed by Developer or Developer's Representatives on the
Subject Property; provided, however, that Developer shall not be required to
indemnify the City for any and all misconduct of the City, or the City's officers,
officials, members, employees, agents, or representatives, subject to any
immunities which may apply to the City with respect to such Claims. The
foregoing indemnification provision shall survive the termination of this
Agreement.
ARTICLE 10. MISCELLANEOUS PROVISIONS
10.1 Entire Agreement. This Agreement sets forth and contains the
entire understanding and agreement of the Parties with respect to
the subject matter set forth herein, and there are no oral or written
representations, understandings or ancillary covenants,
undertakings or agreements which are not contained or expressly
referred to herein. No testimony of evidence of any such
representations, understandings or covenants shall be admissible
in any proceeding of any kind or nature to interpret or determine the
terms or conditions of this Agreement.
10.2 Severability. If any word, phrase, term, provision, clause,
covenant or condition of this Agreement shall be determined
invalid, void or unenforceable, the invalid provision shall be deemed
to be severable from the, remaining provisions contained within the
Agreement. The Parties hereby state and acknowledge they would
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23841\City of SX/Development Agr betw PSWH and City CL1 16
have adopted each and every provision contained within this
Agreement notwithstanding the presence of an invalid provision.
10.3 Interpretation and Governing Law. This Agreement and any
dispute arising hereunder shall be governed and interpreted in
accordance with the laws of the State of California. This
Agreement shall be construed as a whole according to its fair
language and common meaning to achieve the objectives and
purposes of the Parties, and the rule of construction to the effect
that ambiguities are to be resolved against the drafting party or in
favor of the City shall not be employed in interpreting this
Agreement, all Parties having been represented by counsel in the
negotiation and preparation hereof.
10.4 Section Headings. All section headings and subheadings are
inserted for convenience only and shall not affect any construction
or interpretation of this Agreement.
10.5 Waiver. Failure of a Party to insist upon the strict performance of
any of the provisions of this Agreement by the other Party, or the
failure by a Party to exercise it s rights upon the default of the other
Party, shall not constitute a waiver of such Party's right to insist and
demand strict compliance by the other Party with the terms of this
Agreement thereafter.
10.6 No Third Party Beneficiaries. This Agreement is made an entered
into for the sole protection and benefit for the Parties and their
successors and assigns. No other person shall have any right of
action based upon any provision of this Agreement.
10.7 Force Majeure. Upon the Effective Date of this Agreement,
Neither Party shall be deemed to be in default where failure or
delay in performance of any of its obligations under this Agreement
is caused by earthquakes, other acts of God, fires, wars, riots or
similar hostilities, strikes and other labor difficulties beyond the
party's control (including the Party's employment force), court
actions (such as restraining orders or injunctions), or other causes
of a similar nature beyond the Party's reasonable control. If any
such events shall occur, the term of this Agreement and the time for
performance shall be extended for the duration of each such event,
provided that the term of this Agreement shall not extended under
any circumstances of more than five (5) years.
10.8 Mutual Covenants. The covenants contained herein are mutual
covenants and also constitute conditions to the concurrent or
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23841\City of SJC/Development Agr betw PSWH and City CL1 17
subsequent performance by the Party benefited thereby of the
covenants to be performed hereunder by such benefited Party.
10.9 Litigation Expenses. In the event of any action pursuant to
section 5.4 between the City and Pueblo Serra seeking
enforcement of any of the terms and conditions to this Agreement,
the prevailing party in such action shall be awarded, in addition to
such relief to which such party entitled under this Agreement, its
reasonable litigation costs and expenses, including without
limitation its expert witness fees and reasonable attorneys' fees.
10.10 Covenant Not to Sue. The Parties to this Agreement, and each of
them, agree that this Agreement and each term hereof is legal,
valid, binding, and enforceable. The Parties to this Agreement, and
each of them, hereby covenant and agree that each of them will not
commence, maintain, or prosecute any claim, demand, cause of
action, suit, or other proceeding against any other Party to this
Agreement, in law or in equity, or based on an allegation, or assert
in any such action that this Agreement or any term hereof is void,
invalid, or unenforceable under the Development Agreement
legislation.
10.11 Project as a Private Undertaking. It is specifically understood and
agreed by and between the Parties that the Development of the
Subject Project is a private development, that neither Party is acting
as the agent of the other in any respect hereunder, and that each
Party is an independent contracting entity with respect to the terms,
covenants and conditions contained in this Agreement. No
partnership, joint venture or other association of any kind is formed
by this Agreement. The only relationship between the City and
Pueblo Serra is that of a government entity regulating the
Development of private property, on the one hand, and the holder
of a legal or equitable interest in such property and as a current or
future holder of fee title to such property, on the other hand.
10.12 Corporate Authority. The person(s) executing this Agreement on
behalf of each of the Parties hereto represent and warrant that (i)
such Party are duly organized and existing, (ii) they are duly
authorized to execute and deliver this Agreement on behalf of said
Party, (iii) by so executing this Agreement such Party is formally
bound to the provisions of this Agreement, and (iv) the entering into
this Agreement such Party is formally bound to the provisions of
this Agreement, and (iv) the entering into this Agreement does not
violate any provision of any other agreement to which such Party is
bound.
1032/022359-0003
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23641\City of WC/Development Agr betw PSWH and City CL1 18
10.13 Notices. All notices under this Agreement shall be effective upon
personal delivery, via facsimile so long as the sender receives
confirmation of successful transmission from the sending machine,
or three (3) business days after deposit in the United States mail,
first class, postage fully prepaid and addressed to the respective
Parties as set forth below or as to such other address as the
Parties may from time to time designate in writing:
To City: City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attn: City Manager
Facsimile: (949) 488-3874
To Pueblo Serra: Pueblo Serra Worship Holdings
2532 Dupont Drive
Irvine, CA 92612
Attn: Timothy Busch
Telephone: (949)474-7368x100
Facsimile: (949) 474-7732
Copy to: Rutan & Tucker, LLP
611 Anton Boulevard, 14th Floor
Costa Mesa, CA 92626
Attn: John A. Ramirez, Esq.
Facsimile: (714) 564-9035
And
George Mulcaire
The Busch Firm
2532 Dupont Drive
Irvine, CA 92612
Telephone: (939) 474-7368 x205
Facsimile: (949) 474-7732
10.14 Notability of City Officials. No officer, official, member,
employee, agent, or representatives of the City shall be liable for
any amounts due hereunder, and no judgment or execution thereon
entered in any action hereon shall be personally enforced against
any such officer, official, member, employee, agent, or
representative.
10.15 Time of the Essence. The Parties expressly acknowledge and
that time is of the essence in the performance of the provisions of
this Agreement.
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23541\City of SJC/Development Agr betw PSW H and City CLI 19
10.16 Execution Date. The Execution Date of this Agreement is that
date on which all parties have executed this Agreement.
10.17 Effective Date/Condition Subsequent. This Agreement shall not
go into effect until the earlier of the occurring of the following: (a) 60
days following the lapsing of any and all statutes of limitation
applicable to any legal challenge to any of the project approvals,
including Architectural Permit _, this Agreement, and to any and
all environmental impact reports prepared in connection with the
project approvals, or (b) 60 days following the entry of a final, non -
appealable judgment in any action challenging any of the project
approvals, including Architectural Permit_, this Agreement, and
any and all environmental impact reports prepared in connection
with the project approvals. If litigation results in the invalidation of
any of the project approvals, including Architectural Permit_, this
Agreement, or any and all environmental impact reports prepared in
connection with the project, this Agreement shall be void and shall
be of no further force and effect.
10.18 Survival Clause. Notwithstanding Section 1.3 of this Agreement,
Sections 2.2(b), 3.2, 3.3, 3.4, 4.1, 4.2, 4.3, 4.4, 5.1, 5.2, 5.3, 5.4,
7. 1, and 7.2 shall survive the termination of this Agreement after 20
years pursuant to Section 1.3.
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23541\City of WC/Development Agr betty PSWH and City CL1 20
IN WITNESS WHEREOF, the Parties hereto have executed this
Agreement on the day and year first set forth above. n
ATTEST:
Mona
Clerk
I_TUTW Z • a_ •. ;
In Shaw, City Attorney
STATE OF CALIFORNIA
COUNTY OF 0 f G ,nc e
City: Y OF S N U N APISTRANO
By
_z
Mayor, r
of San Juan Capistrano
SS.
PUEBLO SERRA WORSHIP
HOLDINGS,
a California n-QagFofit religious
cor
By
Pr nted Nam Ti othy R. Busch
Itt: Chief Executive Officer
On A Q . ,�) o Q! , before me, ( r ,_ ] _ . 3e, [r.�, a Notary Public,
personally appeared T, . 14-L y Q u Seo
NY personally known to me -OR- [ ] proved to me on the basis of satisfactory evidence to be the
e sono whose name* is/am subscribed to the within instrument and acknowledged to me that
he/shaft" executed the same in his s authorized capacityo*, and that by hisAwwthek
signature(* on the instrument the person* or the entity upon behalf of which the personjiiii;
acted, executed the instrument.
Witness my hand and official seal.
AHERINL. DANKER'r
V COMM, # 1337311 3
(� CTENOTARY PUBLIC.CALIFORNIAU)
ORANGE COUNTY 0
COMM, EXP, JAN, 30. 2006''
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23841\City of SJC/Development Agr betty PSWH and City CLI 21
SIGNATURE OF NOTARY
•PUBLIC AGENCY FORM OF ACKNOWLEDGEMENT
State of California )
County of Orange ) ss.
City of San Juan Capistrano )
(Gov't Code 40814 & Civil Code 1181)
On September 22, 2004 before me, Margaret R. Monahan, City Clerk, personally appeared Joe Soto
personally known to me to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and that by his signature
on the instrument the person, or the entity upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official seal.
Capacity Claimed by Signers
Mayor
Title
Signers are Representing
City of San Juan Capistrano
OPTIONAL
Description of Attached Document
Development Agreement
APN 649-361-03; 649-011-025; 649-011-20,
County of Orange, CA
Exhibit A:
TRAFFIC MITIGATION REQUIREMENTS
A. Mitigation Measures.
Camino Capistrano & Junipero Serra Road. At this location, Developer shall
construct intersection improvements consisting of: an additional northbound
through lane (this shall consist of an additional northbound lane from its
intersection with Junipero Serra Road, northerly to a distance of
approximately 160 feet, to provide a new entry only, no exit, driveway to
align with existing drive aisle in the Sycamore Commons parking lot — the
design to be subject to the approval of the City Engineer); a northbound
right -turn lane; an additional westbound left -turn lane; and a westbound
right -turn lane. Developer shall also construct appropriate and necessary
traffic signal modifications to conform to the intersection improvements
required under this section. Developer shall complete the above stated
work in complete accordance with the plans and specifications for the work
prior to student enrollment reaching 501 students.
2. 1-5 Northbound Ramps & Junipero Serra Road: At this location, Developer
shall construct intersection improvements consisting of: an additional left -
turn lane for the northbound off -ramp in a manner required and approved by
Cal -Trans; widen Junipero Serra Road to five lanes between the 1-5
Northbound and Southbound ramps. Developer shall also construct
appropriate and necessary traffic signal modifications to conform to the
improvements required under this section. Developer shall complete the
above stated work in complete accordance with the plans and specifications
for the work prior to student enrollment reaching 1501 students. Developer's
obligation to construct these improvements shall be subject to a fair share
reimbursement agreement with Developer, with a fair share responsibility
being limited to 31 % of the total cost of the improvements. The remaining
cost of the improvements shall be reimbursed to Developer pursuant to the
terms of the reimbursement agreement, unless prior to the completion of the
improvements required under this section, this improvement shall be added
to the City's CCFP Program. If this improvement is added to the City's
CCFP Program, not more than 69% of the cost of completion of these
improvements incurred by Developer shall be credited against Developer's
total allocation of CCFP fees required so that the total amount of CCFP fees
required to be paid by Developer are reduced on a dollar -for -dollar basis in
an amount equal to the total cost of completion of these of these
improvements.
23641\City of SJC\Exhibit A GPM CL2 -1-
3. Camino Capistrano & Del Obispo Street: Payment of CUP fees, or
satisfaction of Developer's CUP fee obligation, as provided in this Exhibit
A, shall be deemed to be full mitigation for and satisfaction of Developer's
obligations for any improvements to this intersection that have been
identified as necessary due to the roughly proportional impacts imposed on
this intersection by the project. Developer shall not be required to construct
these improvements.
4. Junipero Serra Road & Proiect Driveway: At this location, Developer shall
construct intersection improvements consisting of: a traffic signal, and a
westbound left -turn lane. Engineering plans shall be designed to
accommodate an eastbound left turn lane. Developer shall complete the
above stated work in complete accordance with the plans and specifications
for the work prior to student enrollment reaching 501 students.
5. Camino Capistrano & Oso Road/Proiect Driveway: At this location,
Developer shall construct intersection improvements consisting of:
improving the intersection of Camino Capistrano and Oso Road/Project
driveway by completing construction of a traffic signal, widening Oso Road
to two through lanes eastbound and westbound and an eastbound left turn
lane and a westbound left turn lane, along with the associated railroad
crossing modifications and preemption, grading and landscaping. City shall
reimburse Developer for 100% of the costs and expenses incurred by
Developer in designing and constructing such improvements.
Reimbursement of Developer's costs and expenses shall be paid by City to
Developer upon completion of the improvements after City's review of
reasonable and customary documentation of such costs and expenses as
set forth in the reimbursement agreement to be entered into between
Developer and City. Developer shall complete the above stated work in
complete accordance with plans and specifications for the work prior to
student enrollment reaching 671 students. City will use its best efforts to
assist Developer in connection with any railroad crossing improvements,
including negotiating and/or documenting any necessary agreements with
the Southern California Regional Rail Authority ("SCRRA").
6. Junipero Serra Road from Camino Capistrano along Proiect Frontage: At this
location, Developer shall widen Junipero Serra from Camino Capistrano
across the project frontage to a four -lane divided roadway with a taper to the
existing roadway at the Ultramar Station, which shall be approved by the
City Engineer. Dedication of right-of-way required for this improvement, as
shown on the approved improvement plans, is required at no cost to the
City, prior to completion and acceptance of these improvements. Developer
shall complete the above stated work in complete accordance with the plans
and specifications for the work prior to student enrollment reaching 501
students.
23641\City of SJC\Exhibit A GPM CL2 -2-
7. Camino Capistrano from Junipero Serra Road to Oso Road/Project
Driveway: At this location, Developer shall Widen Camino Capistrano to a
four -lane divided roadway. The improvements shall include a five (5) foot
Class II on road bike lane on each side of the roadway, including all
appurtenant improvements associated with grading and landscaping.
Dedication of all required right-of-way to complete such improvements to the
City, as shown on the approved improvement plans, is required at no cost to
the City, prior to completion and acceptance of these improvements.
Developer shall complete the above stated work in complete accordance
with the plans and specifications for the work prior to student enrollment
reaching 501 students.
8. CUP Fees: Developer shall pay the statutorily -required CUP fee as a
private school as follows: Developer shall pay the requisite CUP private
school fee for not less than 500 students concurrent with the issuance of the
first building permit for the South Campus facilities. Subsequent CUP fees
shall be paid in 100 -student increments in advance of student enrollment
reaching said thresholds. For example, once enrollment reaches 600
students, CUP fees for 700 students shall be paid within 60 days of
enrollment reaching 600 students. There shall be no refund of CUP if
enrollment drops. Notwithstanding the above, any CUP fees paid in
connection with the development of the North Campus (Sycamore
Commons) shall be used as a credit against JSerra's CUP private school
fees. Further, notwithstanding the foregoing or anything to the contrary
contained herein, the fair value costs incurred by Developer in completing
the improvements specified in Table 1 attached hereto and incorporated
herein shall be credited against the CUP fees due under this Section 8, so
that the total amount of CUP fees required to be paid by Developer are
reduced on a dollar -per -dollar basis in an amount equal to the costs to
complete the improvements specified on Table 1. In addition, completion of
the improvements specified in Table 1 by Developer shall be deemed an
accelerated payment of the CUP private school fees set forth above to the
extent that such improvement costs exceed the CUP fees that would then
be payable by Developer based on student enrollment. For example, if the
costs payable by Developer to complete the improvements specified in
Table 1 exceed the total CUP fees that would be owed upon student
enrollment reaching 2,000 students, no additional CUP shall be due or
payable from Developer thereafter upon completion of such improvements
even though the actual student enrollment at the time of completion of such
improvements may be less than 2,000 students. Further, provided
Developer has posted the bond required under Section B hereinbelow, no
CUP fees will be due by Developer upon issuance of a building permit and
Developer may satisfy the CUP obligations by completion of the
improvements specified hereinabove. Prior to Developer commencing
construction of any mitigation measures, Developer and City will enter into a
reimbursement agreement to provide for CUP reimbursement payments
23841\City of SJC\Exhibit A GPM CL2 -3-
and fair share reimbursement payments to Developer, which shall be
payable in equal annual installments over a 15 year period.
B. Surety Bond Requirements.
1. Developer shall post a Faithful Performance Bond with the City in the total
amount of $2.4 million (i.e., 2.4 million as the estimated cost of traffic
mitigation improvements) to guarantee performance of the construction of
traffic mitigation measures required under this Development Agreement.
When construction of specified mitigation measure is completed, the amount
of the Faithful Performance Bond shall be reduced, on a dollar by dollar
basis, by the total amount of the costs incurred by Developer to construct
the completed mitigation improvement.
2. The Surety Bond company shall have a Best Rating of at least B plus.
3. The bond shall be in a form acceptable to the City Attorney.
4. The bond shall be posted within 30 days of the Effective Date of the
Development Agreement as specified in section 10.17 of the Development
Agreement. Subject to reduction in the amount of the bond as provided
above, the bond shall remain in full force and effect until all of the above
stated obligations are fulfilled.
2364hCity of SJCIExhibit A GPM CL2 -4-