04-0131_SJD PARTNERS, LTD._Estoppel CertificateC]
SunCal Companies
CORPORATE OFFICE
2392 MORSE AVENUE
IRVINE. CA 92614
MAIN 949 777 4000
FAX 949 777 4050
WWW. SUNCAL COM
August 18, 2008
City of San Juan Capistrano Woodruff, Spradlin & Smart
Attention: Dave Adams, City Manager Attention: Omar Sandoval, Esq.
32400 Paseo Adelanto 555 Anton Boulevard, Suite 1200
San Juan Capistrano, California 92675 Costa Mesa, California 92626
Re: Pacifica San Juan - Notice of Foreclosure
Mr. Adams and Mr. Sandoval,
SJD Partners, Ltd., a California limited partnership ("Developer"), is the current owner and
developer of the Pacifica San Juan project in San Juan Capistrano, California ("Proiec["). Pursuant to an
Amended and Restated Loan Agreement dated as of January 31, 2004 (the "Loan Agreement'), Lehman
ALI, Inc., a Delaware corporation ("Lehman"), has previously made a loan to Developer (as the same may
be renewed, extended, amended, supplemented, restated or increased from time to time, the "Loan"). The
Loan is secured (together with certain other obligations) by, among other things, an Amended and Restated
Deed of Trust, Security Agreement and Fixture Filing Statement with Assignment of Rents -dated as of
January 31, 2004 (herein, as it may have been or may be from time to time renewed, extended, amended or
supplemented, called the "Deed of Trust"), recorded on January 30, 2004, in the real property records of
Orange County, California, as Instrument No. 2004000075050, covering, among other property, the
Project.
In respect of Developer's default under the Loan, Lehman has determined to foreclose the Deed of
Trust, which action may include, at Lehman's sole discretion, a sale under the lien of the Deed of Trust in
favor of Lehman, either by judicial proceedings or by virtue of any power of sale reserved therein, or a
conveyance by Developer to Lehman or one of its affiliates, one of its subsidiaries, or any other purchaser
designated by Lehman in lieu of foreclosure. The entity acquiring the Project pursuant to such action is
referred to below as the "Acquiring Entity."
Developer has also entered into those certain agreements with the City shown on Schedules A -I
and A.-22 attached hereto (the "Agreements"). This letter memorializes Developer's, Lehman's and the
City's understanding that (1) none of the Agreements require Developer to obtain the consent of the.City to
the transfer of the Project to the Acquiring Entity in the context of a foreclosure because the Agreements
run with the land and the transfer is occurring by operation of law, (2) the Acquiring Entity will be a
"successor in interest" to Developer by operation of law, and as such, the Acquiring Entity will be subject
to both the benefits of the Agreements as well as their burdens and liabilities and (3) with regard to the
Development Agreement (as defined herein), the provision found in Section 4.2 which provides that an
assignment of the Development Agreement shall be subject to prior consent of the City is not applicable in
the context of a foreclosure action.
Notwithstanding the foregoing, Developer and Lehman are hereby requesting that the City execute
the enclosed estoppel certificate no later than August 25, 2008, in order to acknowledge and agree that, to
the best of the City's knowledge, as of the date hereof, (a) there exists no breach, default, event or condition
which, with the giving of notice or the passage of time or both, would constitute a breach or default under
the agreements shown on Schedule A-1, including without limitation, with respect to any timeframes set
forth thereunder that were required to have been met prior to the date hereof, and (b) there are no existing
claims, defenses or offsets against payments due or to become due thereunder.
If you have any questions, please do not hesitate to contact me.
Sincerely, _
David Placek
Vice President, Project Management
Acknowledged and Agreed:
"CITY"
CITY OF SAN JUAN CAPISTRANO,
a municipal corporation
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Name: b00. t� F- A a F s
Title: C'+!�,
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SCHEDULE A-1
1. Amendment and Restatement of Development Agreement recorded July 12, 2004, as Instrument
No. 2004000624737 in the Official Records of Orange County, California ("Development
Agreement').
2. Improvement and Reimbursement Agreement recorded August 9, 1999, as Instrument No.
19990581258 in the Official Records of Orange County, California, as amended by that certain
Amendment to Improvement and Reimbursement Agreement recorded November 28, 2005, as
Instrument No. 2005000945594 in the Official Records of Orange County, California
(collectively, the "Reimbursement Agreement').
SCHEDULE A-2
1. Water Facilities Agreement dated September 2, 2003, as amended by that certain Amendatory
Agreement to Water Facilities Agreement dated March 16, 2004.
2. Special 4(d) Interim Habitat Loss Implementation Agreement dated July 3, 2006.
3. Subdivision Improvement Agreement for Final Tract Map 15609, not dated.
4. Subdivision Improvement Agreement for Final Tract Map 16752, not dated.
5. Subdivision Improvement Agreement for Final Tract Map 16747, not dated.
6. Subdivision Improvement Agreement for Final Tract Map 16749, not dated.
7. Subdivision Improvement Agreement for Final Tract Map 16751, not dated.
10
ESTOPPEL CERTIFICATE
4 -
THIS ESTOPPEL CERTIFICATE ("Estoppel") is made as of theo2i9� of August,
2008, by THE CITY OF SAN JUAN CAPISTRANO, a municipal corporation ("City")for the
benefit of SJD PARTNERS, LTD., a California limited partnership ("Developer") and
LEHMAN ALI, INC., a Delaware corporation ("Lehman"), with reference to the following
facts:
A. City and Developer entered into that certain Amendment and Restatement of
Development Agreement for the Pacifica San Juan Project, effective July 16, 2004 (the
"Development Agreement"), and recorded July 12, 2004, as Instrument No. 2004000624737 in
the Official Records of Orange County, California ("Official Records"), pertaining to the
development of certain real property owned by Developer and located in the City of San Juan
Capistrano, California, informally known as the Pacifica San Juan Project (the "Property").
B. City and Developer also entered into that certain Improvement and
Reimbursement Agreement recorded August 9, 1999, as Instrument No. 19990581258 in the
Official Records, as amended by that certain Amendment to Improvement and Reimbursement
Agreement recorded November 28, 2005, as Instrument No. 2005000945594 in the Official
Records (collectively, the "Reimbursement Agreement", and together with the Development
Agreement, the "Agreements").
C. Pursuant to an Amended and Restated Loan Agreement dated as of January 31,
2004 (the "Loan Agreement"), Lehman has previously made a loan to Developer (as the same
may be renewed, extended, amended, supplemented, restated or increased from time to time, the
"Loan"), The Loan is secured (together with certain other obligations) by, among other things,
an Amended and Restated Deed of Trust, Security Agreement and Fixture Filing Statement with
Assignment of Rents dated as of January 31, 2004 (herein, as it may have been or may be from
time to time renewed, extended, amended or supplemented, called the "Deed of Trust"),
recorded on January 30, 2004, in the Official Records, as Instrument No. 2004000075050,
covering, among other property, the Property.
D. In respect of Developer's default under the Loan, Lehman has determined to
foreclose the Deed of Trust, which action may include, at Lehman's sole discretion, a sale under
the lien of the Deed of Trust in favor of Lehman, either by judicial proceedings or by virtue of
any power of sale reserved therein, or a conveyance by Developer to Lehman or one of its
affiliates, one of its subsidiaries, or any other purchaser designated by Lehman in lieu of
foreclosure (any such action, a "Foreclsure Action"), The entity acquiring the Project pursuant
to such action is referred to below as the "Acquiring Entity".
E. Upon the completion of any Foreclosure Action, the Acquiring Entity shall by
operation of law become the legal successor -in -interest to Developer under the Agreements.
F. Lehman has requested that Developer obtain this Estoppel from the City prior to
the Foreclosure Action.
NOW THEREFORE, in consideration of the foregoing facts, the City hereby agrees As
follows:
1. The Agreements are in full force and effect and are a binding obligation of the
parties. The Agreements have not been amended or modified either orally or in writing.
2. There exists no breach, default, event or condition which, with the giving of
notice or the passage of time or both, would constitute a breach or default under the Agreements,
including, without limitation, with respect to any timeframes set forth thereunder that were
required to have been met prior to the date hereof.
3. There are no existing claims, defenses or offsets against payments due or to
become due under the Agreements.
4. This Estoppel may be executed in counterparts which taken together shall
constitute one and the same instrument.
[SIGNATURE PAGES TO FOLLOW]
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above.
IN WITNESS WHEREOF, City has executed this Estoppel as of the date first set forth
"CITY"
CITY OF SAN JUAN CAPISTRANO,
a municipal corporation
By:
Name: Sr v
Title: Community Development Director
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Signature Page — Estoppel Certificate — City of San Juan Capistrano
Pacifica San Juan
R 52279-00280