10-0415_ST. MARGARET EPISCOPAL SCHOOL_Development agreement Recorded in Official Records, Orange County
Tom Daly, Clerk-Recorder
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RECORDING REQUESTED BY AND NO FEE
2010000163395 2:12 pm 04/07/10
WHEN RECORDED MAIL TO: 106 416 Al2 38
City Clerk 0.00 0.00 0.00 0.00 111.00 0.00 0.00 0.00
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
(Space Above This Line for Recorder's Office Use Only) i
(Exempt from Recording Fee per Gov.Code§§6103 and 27383)
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DEVELOPMENT AGREEMENT
(ST. MARGARET'S EPISCOPAL SCHOOL EXPANSION PROJECT)
by and between
CITY OF SAN JUAN CAPISTRANO
and
ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL
Effective April 15, 2010 (Ordinance No. 968 adopted March 16, 2010)
TABLE OF CONTENTS
Page
1. DEFINITIONS...................................................................................................................4
1.1 Authorizing Ordinance...........................................................................................4
1.2 Campus Parcels......................................................................................................4
1.3 CEQA.....................................................................................................................5
1.4 CITY.......................................................................................................................5
1.5 City Council ...........................................................................................................5
1.6 Default....................................................................................................................5
1.7 Develop or Development or Developing ...............................................................5
1.8 Developer...............................................................................................................5
1.9 Development Agreement Legislation.....................................................................5
1.10 Development Exactions..........................................................................................5
1.11 Development Plan..................................................................................................5
1.12 Development Plan Approval(s)..............................................................................6
1.13 Development Transferee ........................................................................................6
1.14 Effective Date.........................................................................................................6
1.15 Expansion Parcels ..................................................................................................6
1.16 Future Development Approvals.............................................................................6
1.17 On-Site Improvements ...........................................................................................6
1.18 [Reserved] ..............................................................................................................6
1.19 Party or Parties.......................................................................................................6
1.20 Property..................................................................................................................6
1.21 Planning Commission ............................................................................................6
1.22 Project.....................................................................................................................7
1.23 Property..................................................................................................................7
1.24 St. Margaret's Episcopal School Master Plan........................................................7
1.25 Term.......................................................................................................................7
2. GENERAL PROVISIONS.................................................................................................7
2.1 Binding Covenants.................................................................................................7
2.2 Interest of SMES ....................................................................................................7
2.3 Term.......................................................................................................................7
2.4 Termination............................................................................................................8
2.5 Transfers and Assignments ....................................................................................8
3. DEVELOPMENT PROVISIONS......................................................................................9
3.1 Vesting ...................................................................................................................9
3.2 Reserved Authority ..............................................................................................10
3.3 Further Assurances to SMES Regarding Exercise of Reserved Authority..........12
3.4 Vested Right.........................................................................................................12
3.5 Amendment of Development Agreement.............................................................13
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3.6 Future Amendments to Development Plan ..........................................................14
3.7 Future Development Approvals ...........................................................................15
4. MISCELLANEOUS OBLIGATIONS OF THE PARTIES.............................................15
4.1 SMES's Rights and Obligations With Respect to Implementing St. Margaret's
Episcopal School Master Plan..............................................................................15
4.2 Future Development Approvals.................................................................................17
5. INDEMNIFICATION......................................................................................................17
6. RELATIONSHIP OF PARTIES......................................................................................18
7. AMENDMENT OR CANCELLATION OF AGREEMENT..........................................18
8. PERIODIC REVIEW OF COMPLIANCE WITH AGREEMENT.................................18
8.1 Periodic Review...................................................................................................18
8.2 Good Faith Compliance .......................................................................................18
8.3 Failure to Conduct Annual Review......................................................................18
8.4 Initiation of Review by City Council...................................................................18
8.5 Administration of Agreement...............................................................................19
8.6 Availability of Documents...................................................................................19
9. EVENTS OF DEFAULT: REMEDIES AND TERMINATION.....................................19
9.1 Defaults by SMES................................................................................................19
9.2 Defaults by CITY.................................................................................................19
9.3 Specific Performance Remedy.............................................................................19
9.4 Institution of Legal Action...................................................................................20
9.5 Estoppel Certificates ............................................................................................20
10. WAIVERS AND DELAYS .............................................................................................21
10.1 No Waiver............................................................................................................21
10.2 Third Parties.........................................................................................................21
10.3 Force Majeure ......................................................................................................21
10.4 Extensions ............................................................................................................21
10.5 Notice of Delay ....................................................................................................22
11. NOTICES.........................................................................................................................22
12. ATTORNEYS' FEES. ......................................................................................................23
13. RECORDING...................................................................................................................23
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Page
14. EFFECT OF AGREEMENT ON TITLE.........................................................................24
14.1 Effect on Title.......................................................................................................24
14.2 Encumbrances and Lenders' Rights......................................................................24
15. SEVERABILITY OF TERMS.........................................................................................24
16. SUBSEQUENT AMENDMENT TO AUTHORIZING STATUTE. ..............................24
17. RULES OF CONSTRUCTION AND MISCELLANEOUS TERMS.............................25
17.1 Interpretation and Governing Law.......................................................................25
17.2 Section Headings..................................................................................................25
17.3 Gender..................................................................................................................25
17.4 Time of Essence ...................................................................................................25
17.5 Recitals.................................................................................................................25
17.6 Entire Agreement .................................................................................................25
18. NOT FOR BENEFIT OF THIRD PARTIES...................................................................26
19. COOPERATION IN EVENT OF LEGAL CHALLENGE.............................................26
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DEVELOPMENT AGREEMENT
(ST. MARGARET'S EPISCOPAL SCHOOL EXPANSION PROJECT)
This DEVELOPMENT AGREEMENT (ST. MARGARET'S EPISCOPAL SCHOOL
EXPANSION PROJECT) (the "Agreement") is dated for reference purposes only as of the 2nd
day of March, 2010, and is being entered into by and between the CITY OF SAN JUAN
CAPISTRANO, a municipal corporation, organized and existing under the laws of the State of
California ("CITY"), and ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL, a
California non-profit public benefit corporation ("SMES"), pursuant to the authority of Sections
65864 through 65869.5 of the California Government Code (the "Development Agreement
Legislation") and Article XI, Section 2, of the California Constitution. CITY and SMES are
sometimes hereinafter referred to as the "Parties."
RECITALS
This Agreement is predicated upon the following facts:
A. These Recitals refer to and utilize certain capitalized terms which are defined in
this Agreement. The Parties intend to refer to those definitions in conjunction with the use
thereof in these Recitals.
B. The Development Agreement Legislation authorizes CITY to enter into binding
development agreements with persons having legal or equitable interests in real property for the
development of such property in order to, among other things: ensure high quality development
in accordance with comprehensive plans; provide certainty in the approval of development
projects so as to avoid the waste of resources and the escalation in the cost of housing and other
development to the consumer; provide assurance to the applicants for development projects that
they may proceed with their projects in accordance with existing policies, rules, and regulations,
subject to the applicable conditions of approval, in order to strengthen the public planning
process and encourage private participation in comprehensive planning and reduce the private
and public economic costs of development; and encourage and provide for the development of
public infrastructure and amenities to support the development of new housing and commercial
projects.
C. SMES and its single member, the Protestant Episcopal Church in the Diocese of
Los Angeles ("Diocese"), are the fee owners of that certain real property consisting of 26.89
acres of land located in and adjacent to a block defined by Ortega Highway, La Novia Avenue,
Calle Arroyo and Rancho Viejo Road in the in the City of San Juan Capistrano, County of
Orange, State of California, that is more particularly described and depicted in Exhibit "A"
attached hereto and made a part hereof(the "Property").
D. Of the total Property's 26.89 acres, 18.82 acres comprise the development
commonly known as "St. Margaret's Episcopal School" depicted and described as the "Campus
Parcels" in Exhibit "A", and the remaining approximately 8.07 acres constitute the "Expansion
Parcels" depicted and described in Exhibit "A". The Diocese is the fee owner of the Campus
Parcels and SMES has the exclusive right to use the Campus Parcels pursuant to a Memorandum
of Agreement between SMES and the Diocese and is the owner of all of the buildings thereon.
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SMES is the fee owner of the Expansion Parcels. SMES owns the three Rancho Viejo Road lots
of the Expansion Parcels as the sole member of Ortega III LLC.
E. SMES applied for, and CITY approved Development of the Campus Parcels and
Expansion Parcels pursuant to General Plan Amendment 06-03, Rezone 07-05, Architectural
Control 07-22, Saint Margaret's Episcopal School Master Plan, in accordance with the
provisions of this Agreement, the Saint Margaret's Episcopal School Master Plan ("Master
Plan"), and other applicable regulations of the City of San Juan Capistrano and other
governmental agencies having jurisdiction over the Property and the "Project" as defined in
Section 1.22 below.
F. SMES has applied for, and CITY has approved, this Agreement in order to create
a beneficial development project and a physical environment that will conform to and
complement the goals of CITY, be sensitive to human needs and values, and facilitate efficient
traffic circulation. By its approval and execution of this Agreement CITY has determined that
CITY (including, without limitation the existing and future residents of CITY) will receive the
following direct and indirect benefits from the implementation of this Agreement:
1. The Project will conform to CITY's goal to manage growth through the
use of, among other things, comprehensive planning and design, project-wide continuity
of landscaping and architectural design, state-of-the-art development standards, and
planning concepts.
2. The traffic and circulation elements of the Development Plan will conform
to CITY's General Plan by reducing the impact of the average daily trips generated by the
Development of the Project on arterial roads and thoroughfares adjacent to the Expansion
Parcels consistent with Transportation and Traffic Mitigation Measures set forth in the
Mitigation Monitoring and Reporting Program for the Project.
3. As a religious organization, SMES is exempt from paying property taxes
on land dedicated to educational and religious uses. SMES does pay property taxes today
on the Expansion Parcels, which in the future, upon conversion to school uses, would be
subject to the property tax exemption. Also, the CITY would potentially lose sales tax
revenue as a result of the Project's removal of commercial buildings from the Expansion
Parcels and development of the Expansion Parcels for non-commercial uses.
Notwithstanding the SMES exemption from property taxes by virtue of its status as a
religious organization, in exchange for CITY's agreement to enter into and perform its
obligations set forth in this Agreement, SMES has agreed that SMES shall make an
annual payment to CITY as set forth in Section 4.1.3 below to, among other things,
compensate CITY for the loss of property taxes from removing the Expansion Parcels
from the tax rolls and loss of potential sales tax revenues, thereby providing substantial
benefits to CITY and its residents.
4. The Project will result in the expansion of the existing St. Margaret's
Episcopal School which will be of benefit to CITY and its residents by providing
additional educational resources to the community. Approximately 250 students (20% of
the students currently enrolled at St. Margaret's Episcopal School) are residents of San
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Juan Capistrano, and 700 students (57% of currently enrolled students) would otherwise
attend the Capistrano Valley Unified School District. In exchange for CITY's agreement
to enter into and perform its obligations set forth in this Agreement, SMES has agreed to
provide for increased financial aid to expand enrollment of students who are residents of
San Juan Capistrano, as set forth in Sections 4.1.4 below.
5. The Project will result in dedication of an easement to CITY for a multi-
use trail connector along La Novia Avenue along the frontage of SMES upon CITY's
approval of a final trail alignment as part of CITY's General Plan.
6. The Project will result in a shared parking agreement with CITY providing
an additional parking lot to serve CITY's Cook Park and Trails that will provide
substantial benefits to CITY and its residents.
7. SMES will allow the Ortega Equestrian Center ("OEC") to continue
operating on the Project site until May 31, 2012 or any later date agreed upon in writing
by both SMES and OEC, and will work with OEC to accommodate relocation of the
facilities in an orderly manner by May 31, 2012, or any later date agreed upon in writing
by both SMES and OEC.
G. The following actions have been taken with respect to this Agreement and the
Project:
1. On or about March 2, 2010, pursuant to the applicable provisions of the
California Environmental Quality Act, Public Resources Code Section 21000 et seq., and
the regulations promulgated by the Secretary of Resources pursuant thereto (Title 14 of
the California Code of Regulations, Section 15000 et seq.) (collectively, "CEQA"), the
City Council of CITY found and determined that all of the significant environmental
impacts of the Project, including this Agreement, were adequately mitigated and adopted
a Mitigated Negative Declaration;
2. On or about March 2, 2010, the City Council of CITY approved the
Project;
3. On or about January 26, 2010, following a duly noticed and conducted
public hearing, the Planning Commission of CITY recommended to the City Council that
it approve this Agreement;
4. On or about March 2, 2010, after a duly noticed and conducted public
hearing, the City Council of CITY determined that the provisions of this Agreement are
consistent with the General Plan of CITY; and
5. On or about March 2, 2010, after a duly noticed and conducted public
hearing, the City Council of CITY introduced Ordinance No. approving and
authorizing the execution of this Agreement and on March 16, 2010, the City Council of
CITY adopted said Ordinance (hereinafter the "Authorizing Ordinance"), a copy of which
Authorizing Ordinance is on file in the City Clerk's office at City Hall.
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H. In consideration of the substantial public improvements and benefits to be
provided by SMES and the Project, and in order to strengthen the public planning process and
provide significant educational and economic benefits to the City of San Juan community, by
this Agreement CITY intends to provide to SMES the assurance that it can proceed with
Development of the Project for the Term of this Agreement pursuant to the terms and conditions
of this Agreement and in accordance with the CITY's General Plan, ordinances, policies, rules,
and regulations existing as of the Effective Date. In reliance on CITY's covenants in this
Agreement concerning Development of the Property, SMES has and will in the future incur
substantial costs in site preparation and the construction and installation of major infrastructure
and facilities in order to make the Master Plan feasible.
I. Pursuant to Section 65867.5 of the Development Agreement Legislation, the City
Council has found and determined that: (i) this Agreement and the Development Plan for the
Project implement the goals and policies of CITY's General Plan, provide balanced and
diversified land uses and impose appropriate standards and requirements with respect to land
development and usage in order to maintain the overall quality of life and the environment
within the City of San Juan Capistrano, (ii) this Agreement is in the best interests of and not
detrimental to the public health, safety, and general welfare of CITY and its residents; (iii)
adopting this Agreement is consistent with CITY's General Plan and constitutes a present
exercise of CITY's police power; and (iv) this Agreement is being entered into pursuant to and in
compliance with the requirements of Section 65867 of the Development Agreement Legislation.
J. CITY and SMES agree that it may be beneficial to enter into additional
agreements and operating memoranda, or to modify this Agreement with respect to the
implementation of the separate components of the Development Plan when more information
concerning the details of each component is available, and that this Agreement should expressly
allow for such contemplated additional agreements, operating memoranda, and modifications to
this Agreement.
AGREEMENT
NOW, THEREFORE, pursuant to the authority contained in the Development Agreement
Legislation, as it applies to CITY, pursuant to Article XI, Section 2 of the California
Constitution, and in consideration of the foregoing recitals of fact, all of which are expressly
incorporated into this Agreement, the mutual covenants set forth in this Agreement, and for the
further consideration described in this Agreement, the Parties agree as follows:
1. Definitions.
The following words and phrases are used as defined terms throughout this Agreement
and each defined term shall have the meaning set forth below:
1.1 Authorizin¢ Ordinance. "Authorizing Ordinance" means Ordinance No.
approving this Agreement.
1.2 Campus Parcels. "Campus Parcels" has the meaning ascribed in Recital D of this
Agreement.
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1.3 CEOA. "CEQA" has the meaning ascribed to that term in Recital F.1 of this
Agreement.
1.4 CITY. "CITY" means the City of San Juan Capistrano, a California municipal
corporation, duly organized and existing under the Constitution and laws of the State of
California, and all of its officials, employees, agencies, and departments.
1.5 City Council. "City Council" means the duly elected and constituted city council
of CITY,
1.6 Default. "Default" has the meaning ascribed in Section 9.1 or 9.2 of this
Agreement, as applicable.
1.7 Develop or Development or Developing. "Develop" or "Development" or
"Developing" means the improvement and use of the Property for purposes consistent with the
Project and this Agreement, including, without limitation: subdividing, grading, the construction
of infrastructure and public facilities related to the St. Margaret's Episcopal School Master Plan,
the construction of structures and buildings, and the installation of landscaping, all in accordance
with the provisions of this Agreement, but does not include the maintenance, repair,
reconstruction, or redevelopment of any building, structure, improvement, or facility after the
initial construction and completion thereof.
1.8 Developer. Developer means St. Margaret's of Scotland Episcopal School, all
successors in interest, in whole or part, to the right, title, and interest of any of such entity in and
to this Agreement with respect to all or any portion of the Property.
1.9 Development Agreement Legislation. "Development Agreement Legislation"
means Sections 65864 through 65869.5 of the California Government Code as it exists on the
Effective Date.
1,10 Development Exactions. "Development Exactions" means any requirement of
CITY for the dedication of land (including without limitation through the encumbrance of land
with an casement or use restriction in favor of a public agency, the public, or a private non-profit
entity), the construction or improvement of public improvements or facilities (including without
limitation improvements or facilities located on land that is encumbered with an easement or use
restriction in favor of a public agency, the public, or a private non-profit entity), or the formation
of any Financing District and/or payment of any special taxes, assessments, or fees, in order to
provide any such public improvements or facilities in conjunction with Development or to
lessen, offset, mitigate, or compensate for the impacts of development on the environment or
other public interests consistent with the Project and this Agreement.
1,11 Development Plan. "Development Plan" means the plan for Developing the
Project on the Property in accordance with this Agreement, the Development Plan Approval(s),
and the Future Approvals. As of the Effective Date, the Development Plan consists of the
Master Plan, provisions of CITY's General Plan (as amended through the General Plan
Amendment referred to in Recital E) applicable to the Property, the narrative description of the
Project set forth in Exhibit `B"to this Agreement, the Development Plan Approvals set forth in
Exhibit "C"to this Agreement, and the express provisions set forth in this Agreement that define
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or describe the Project. The Future Development Approvals automatically shall become a part of
the Development Plan and included within the scope of SMES's vested rights provided for in this
Agreement without the need for any amendment of this Agreement when the same are issued or
approved by CITY and become effective. Each of the documents memorializing the
Development Plan is (or will be) maintained in the official records of CITY and shall be utilized
whenever required to interpret or apply this Agreement.
1.12 Development Plan Approval(s). "Development Plan Approval(s)" means the
approvals of the City Council described in Exhibit "C" hereto insofar as the same relate to the
Property and the Development Plan, including those amendments to this Agreement made in
accordance with Section 3.5 hereof, those amendments to the Development Plan Approval(s)
made in accordance with Section 3.6 hereof, and those Future Development Approvals made in
accordance with Section 3.7 hereof.
1.13 Development Transferee. "Development Transferee" means a person or entity
that expressly assumes obligations under this Agreement pursuant to Section 2.5 hereof.
1.14 Effective Date. "Effective Date" means the date the Authorizing Ordinance
becomes effective.
1.15 Expansion Parcels. "Expansion Parcels" has the meaning ascribed in Recital D of
this Agreement.
1.16 Future Development Approvals. "Future Development Approvals" means those
entitlements and approvals that are: (a) made in accordance with Section 3.7 hereof-, and
(b)requested by SMES in order to authorize the Development to occur upon the Property in a
manner consistent with the Development Plan Approval(s). By way of enumeration, and not
limitation of the foregoing, the Future Development Approvals include such development
permits, development plan reviews, use permits, variances, grading permits, building permits,
and occupancy permits that are required as a condition to SMES's right to Develop pursuant to
the Development Approvals for all or any portion of the Project. There is no intention to include
any approvals that are beyond the implementation of the specific development listed on Exhibit
B.
1.17 On-Site Improvements. "On-Site Improvements" means physical infrastructure
improvements or facilities that are or will be located on the Property consistent with the
Development Plan Approvals.
1.18 [RESERVED]
1.19 Party or Parties. "Party" means either CITY or SMES, as the context dictates, and
"Parties" means CITY and SMES.
1.20 Property. "Property" means the Property referred to in Recital C and more
particularly described in Exhibit "A"to this Agreement.
1.21 Planning Commission. "Planning Commission" means the duly appointed and
constituted planning commission of CITY.
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1.22 Project. "Project" means the Development and approvals summarized in
Recital E,the planning elements of which are more specifically described in Exhibit "B"hereto.
1.23 Prope 'Property" means the Property referred to in Recital C and more
particularly described in Exhibit "A"to this Agreement.
1.24 St. Margaret's Episcopal School Master Plan. "St. Margaret's Episcopal School
Master Plan" means the Master Plan approved by CITY Council Resolution No. 10-03-02-03.
1.25 Term. "Term" means the period of time that this Agreement remains in effect
with respect to the Property or any portion thereof, as provided in Section 2.3.
2. General Provisions.
2.1 Binding Covenants. The provisions of this Agreement to the extent permitted by
law shall constitute covenants which shall run with the Property for the benefit thereof, and the
benefits and burdens of this Agreement shall bind and inure to the benefit of the Parties and all
successors in interest to the Parties hereto.
2.2 Interest of SMES. As of the date this Agreement is being executed by the Parties,
SMES represents that SMES and its single member, the Protestant Episcopal Church in the
Diocese of Los Angeles ("Diocese"), are the fee owners of that certain real property consisting
of 26.89 acres of land located in and adjacent to a block defined by Ortega Highway, La Novia
Avenue, Calle Arroyo and Rancho Viejo Road in the in the City of San Juan Capistrano,
County of Orange, State of California, that is more particularly described and depicted in
Exhibit "A" attached hereto and made a part hereof(the "Property"). Of the total Property's
26.89 acres, 18.82 acres comprise the development commonly known as "St. Margaret's
Episcopal School' depicted and described as the "Campus Parcels" in Exhibit "A", and the
remaining approximately 8.07 acres constitute the "Expansion Parcels" depicted and described
in Exhibit "A". The Diocese is the fee owner of the Campus Parcels and SMES has the
exclusive right to use the Campus Parcels pursuant to a Memorandum of Agreement between
SMES and the Diocese and is the owner of all of the buildings thereon. SMES is the fee owner
of the Expansion Parcels. SMES owns the three Rancho Viejo Road lots of the Expansion
Parcels as the sole member of Ortega III LLC.
2.3 Term. Subject to the provisions of Section 10.4 of this Agreement, the initial
term (hereinafter called "Term") of this Agreement shall commence on the Effective Date and
shall terminate at the end of the day immediately preceding the twentieth (20th) anniversary of
the Effective Date, subject to the termination provisions set forth herein; provided, however,
that so long as SMES is not in Default of this Agreement and the Agreement has not been
otherwise terminated, SMES may, without the prior written consent of CITY, extend the Term
for one (1) additional period of two (2) years; and provided further that with respect to such 2-
year extension option, SMES shall give CITY written notice of its intent to extend the Term not
more than one hundred eighty (180) days and not less than sixty (60) days before the end of the
initial Term. Pursuant to California Government code sections 65863.9 and 66452.6(a), the
expiration date of all Development Plan Approval(s) shall be extended through the Term of this
Agreement, and any extension pursuant to this Section 2.3. Notwithstanding any other
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provision of this Agreement, the provisions of Sections 4.1.3 and 4.1.4 shall survive termination
of this Agreement and shall remain in effect coterminous with Conditional Use Permit 02-14.
2.4 Termination. This Agreement shall be deemed terminated and of no further effect
upon the occurrence of any of the following events:
(i) If termination occurs pursuant to any specific provision of this Agreement;
or
(ii) As to provisions of this Agreement governing On-Site Improvements on
any separate legal lot(s) or parcel(s) within the Property, upon the completion of On-Site
Improvements on and with respect to said lot(s) or parcel(s) pursuant to the terms of this
Agreement and CITY's issuance of all required occupancy permits or final inspections, as
applicable, and acceptance of all dedications and improvements required to complete
such On-Site Improvements; or
(iii) Entry after all appeals have been exhausted of a final judgment or issuance
of a final order directed to CITY invalidating this Agreement.
The termination of this Agreement in its entirety or with respect to a particular lot(s) or
parcel(s) shall not affect any right or duty of SMES arising from any provisions of this
Agreement that remain effective or from a source other than this Agreement.
In the event this Agreement terminates in its entirety or with respect to a particular lot(s)
or parcel(s), and notwithstanding any other provision set forth herein, upon request by SMES, or
any other successor or assignee of either of them, CITY shall cooperate, at no cost to CITY, in
executing in recordable form a document prepared by the requesting party that confirms the
termination of this Agreement with respect to the Property or applicable portion thereof.
2.5 Transfers and Assignments.
2.5.1 SMES and/or the Protestant Episcopal Church in the Diocese of Los
Angeles ("Owners") shall not assign all or any part of this Agreement without the prior written
approval of the City. Such written approval by the City shall not be unreasonably withheld,
provided that: (a) if Owners' proposed assignee is an entity, such entity shall be legally formed
and qualified to conduct business in the State of California; (b) Owners shall have delivered
evidence to City that Owners' proposed assignee has the ability to comply with the Agreement;
(c) Owners and its/their assignee execute an assignment and assumption agreement pursuant to
which the assignee expressly assumes all of Owners' obligations under the Agreement; and (d)
City shall bear no expenses in connection with such assignment. Notwithstanding any other
provision of this Agreement, Owners need not obtain the prior written approval of City for the
assignment of this Agreement to a limited liability company, limited partnership or corporation
wholly-owned by, or under common control with, Owners.
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3. Development Provisions.
3.1 Vesting.
3.1.1 Project. CITY covenants SMES has and shall have the right to Develop
the Project on the Property consistent with the Development Plan and the Development Plan
Approval(s), including, without limitation, the Future Development Approvals after the same
have been issued or approved by CITY and become effective ("vested right").
3.1.2 Limits on Development. The California Supreme Court held in Pardee
Construction Company v. City of Camarillo, 37 Ca1.3d 465 (1984), that the failure of the parties
to address certain limits on a city's ability to condition, restrict, or regulate a development
allowed a later adopted initiative to restrict the development. This Agreement is intended to cure
that deficiency by expressly addressing the timing for the Development, the vested rights
afforded by this Agreement, and the scope of CITY's reserved authority described in Section 3.2
hereof. Except as expressly set forth in the Development Plan and Development Plan
Approval(s), regardless of any future enactment, whether by initiative or otherwise, SMES shall
have the vested right to Develop the various components of the Project in such order, at such
rate, in one phase or in multiple phases, and at such times as SMES deems appropriate within the
exercise of its subjective business judgment. Specifically, CITY agrees that SMES shall be
entitled to apply for and receive the Future Development Approvals and to Develop and use the
Property at any time, provided that such application is made and such Development occurs in
accordance with this Agreement and the other Development Plan Approval(s). No future
amendment of any CITY law and no future adoption of any CITY law or other action that
purports to limit the scope, rate, or timing of Development on the Property or to alter the
sequencing of the Development in a manner inconsistent with the Development Plan or the
Development Plan Approval(s) (including without limitation the Future Development Approvals
when issued by CITY), whether the same are adopted or imposed by the City Council or through
the initiative or referendum process, shall apply to the Property. Notwithstanding the foregoing,
nothing in this Section 3.1 shall limit or restrict CITY's reserved authority as described in
Section 3.2.
3.1.3 Entitlements, Permits, and Approvals—Cooperation.
3.1.3.1 Processing. CITY agrees that it shall accept and expeditiously
process, pursuant to CITY's regular procedures, complete applications for the Future
Development Approvals and, if applicable, SMES's complete applications for
amendments to this Agreement, to the Development Plan Approval(s), and to any of the
Future Development Approvals (after the same have been initially approved).
3.1.3.2 Other Permits. CITY further agrees to reasonably cooperate
with SMES, at no cost to CITY, in securing any County, State, and Federal permits or
authorizations which may be required in connection with Development of the Property
that are consistent with the Development Plan and Development Plan Approval(s);
provided, that nothing in this Section 3.1.3.2 shall be deemed to require CITY's
assumption of any obligations under any said permits or authorizations.
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3.1.3.3 Acquisition of Off-Site Property. CITY shall not postpone or
refuse approval of any Future Development Approval because SMES or a Development
Transferee has failed to acquire off-site property required for the construction or
installation of offsite improvements. To the extent CITY, SMES, or a Development
Transferee does not have sufficient title or interest to permit any of such offsite
improvements that are such entity's responsibility to be constructed or installed at the
time the application for a Future Development Approval is processed or approved by
CITY, SMES or the Development Transferee shall make a good faith effort to acquire the
required property. If SMES or the Development Transferee is unable to acquire the
required property, CITY shall consider in good faith the acquisition of the required
property. If CITY is unable to acquire the required property by negotiation or
condemnation within the time frame provided for in Government Code Section 66462.5,
CITY shall continue to issue the Future Development Approval(s) for the Property
despite the fact that the offsite improvement has not been completed. Notwithstanding
the foregoing, CITY's obligation to continue to issue the Future Development Approvals
as provided for in this Section is contingent upon: (i) SMES or the Development
Transferee submitting the improvement plans required for the improvement to CITY; and
(ii) consistent with Government Code Section 66462.5, SMES or the Development
Transferee entering into a mutually acceptable agreement with CITY that requires SMES
or the Development Transferee to pay or reimburse or secure the future payment or
reimbursement of CITY for SMES's fair share of the costs incurred in acquiring the land
and constructing the applicable offsite improvement(s) at such time as CITY acquires the
required land.
3.2 Reserved Authority.
3.2.1 Reservation of Authority With Respect to Future Development
Approvals: Future Changes in Development Exactions. Notwithstanding any other provision set
forth in this Agreement to the contrary, CITY reserves the right after the Effective Date of this
Agreement to change its development standards applicable to the Property and the Project and to
exercise the same degree of discretion and control in its consideration of Future Development
Approvals that it would have in the absence of this Agreement to impose conditions under
CEQA and other applicable laws and regulations that apply to all similar development
throughout the CITY in order to mitigate the Project's impact on the environment, subject to the
following limitations:
(i) No such future changes in CITY's development standards or
mitigation measures shall be inconsistent with the Development Plan, the Project
Development Approvals, or any of the provisions set forth in Sections 3.1 or 4.1-
4.2 of this Agreement, nor shall any such future changes materially jeopardize or
impair the rights of SMES thereunder;
(ii) No change in CITY's development standards or mitigation
measures adopted or imposed after the Effective Date with respect to the affected
portion of the Property shall apply except to the extent the same shall be
applicable to similarly situated properties or projects on a citywide or areawide
basis; and
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(iii) CITY shall not require the Project or the Property to participate in
regional programs (i.e., programs that are not initiated by CITY and that include
properties located in whole or in part outside the City of San Juan Capistrano) nor
shall CITY require the Project or the Property to pay or contribute to regional
Development Exactions to the extent that such programs or Development
Exactions are not in effect as of the Effective Date with respect to the affected
portion of the Property, including without limitation any such programs or
Development Exactions initiated by the County of Orange.
3.2.2 Uniform Codes. This Agreement shall not prevent CITY from applying
to the Project new uniform construction standards adopted by the State of California as State
Codes, such as the Uniform Building Code, National Electrical Code, Uniform Mechanical
Code, and Uniform Fire Code, provided those same standards are applied to all other
development within the City of San Juan Capistrano.
3.2.3 State and Federal Laws and Regulations. SMES shall comply with all
applicable state and federal laws and regulations, provided that nothing in this Agreement shall
be deemed to limit or restrict the right of SMES to contest or challenge the validity of any such
laws or regulations or their applicability to the Property or the Project. In the event that either
CITY or SMES determines that a state or federal law or regulation prevents the full
implementation of the Development Plan and/or any of the Development Plan Approval(s), that
Party shall provide the other Party with written notice of the state or federal law or regulation, a
copy of the law or regulation, and a written statement of the conflicts between such state or
federal law or regulation and this Agreement. Promptly thereafter CITY and SMES shall meet
and confer in good faith in a reasonable attempt to determine whether a modification or
suspension of this Agreement is required, provided that each Party reserves its discretion with
respect thereto. CITY agrees to cooperate with SMES in resolving the conflict in a manner
which minimizes any adverse fiscal or other impact of the conflict upon SMES, provided only
that in no event does CITY agree that in such event it will materially increase its financial
obligations set forth in this Agreement or otherwise materially increase its obligations. CITY
also agrees to process in a prompt manner SMES's proposed changes to the Development Plan
and/or Development Plan Approval(s) as may be necessary to comply with such federal or state
law or regulation; provided, however, that the approval of such changes by CITY shall be subject
to the discretion of CITY, consistent with this Agreement.
3.2.4 Suspension of Development in Order to Protect Health and Safety.
Nothing in this Agreement shall be construed to be in derogation of CITY's police power to
suspend the right of SMES to develop all or any portion of the Project in order to protect the
public health and safety (e.g., in the event of the unavailability of adequate water, wastewater
treatment, or storm drainage facilities). In the event that CITY determines that the public health
or safety require a suspension of SMES's right to develop all or any portion of the Project, the
scope of the suspension shall be limited to the extent determined by CITY to be reasonably
necessary to protect the public health or safety, the term of the suspension shall be limited to the
period of time during which the public health or safety concern continues, and CITY shall
exercise reasonable good faith efforts to minimize the period of such suspension to the extent
that the cause thereof is within CITY's control. As soon as is reasonably practicable after the
commencement of an event that results in a suspension of the rights of SMES to develop
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hereunder due to public health or safety concerns, CITY shall provide SMES with written notice
of the existence of such event, a detailed explanation of CITY's proposed action, and a written
statement of any conflicts with the provisions of this Agreement that require a suspension of any
of the terms hereof. Promptly thereafter CITY and SMES shall meet and confer in good faith in
a reasonable attempt to determine whether a modification or suspension of this Agreement in
whole or in part, is necessary. In such negotiations, CITY and SMES agree to preserve the terms
of this Agreement and the rights of SMES as derived from this Agreement to the maximum
feasible extent while resolving the conflict. CITY agrees to cooperate with SMES in a good faith
reasonable effort to resolve any such conflict in a manner which minimizes any adverse financial
or other impact of the conflict upon SMES without materially increasing the obligations of CITY
under this Agreement. CITY also agrees in such event to process in an expedited manner
SMES's proposed changes to the Development Plan and any previously issued Development
Plan Approval(s) as may be necessary to appropriately respond to the public health and safety
concern with respect to the portion of the Property owned by SMES; provided, however, that the
approval of any such changes by CITY shall be subject to the discretion of CITY, consistent with
this Agreement, and no such change shall apply to any other portion of the Property without the
prior written consent of the owner(s) thereof.
3.3 Further Assurances to SMES Regarding Exercise of Reserved Authority. The
Parties further acknowledge that the public benefits to be provided by SMES to CITY pursuant
to this Agreement are in consideration for and reliance upon assurances that the Property may
be developed and used in accordance with the Development Plan and the Development Plan
Approval(s). Accordingly, while recognizing that the Development of the Property may be
affected by the exercise of the authority and rights reserved and excepted as provided in
Sections 3.1 ("Vesting") and 3.2 ("Reserved Authority"), SMES is concerned that normally the
judiciary extends to local agencies significant deference in the adoption of rules, regulations,
and policies and that in the absence of an express provision set forth in this Agreement such
judicial deference might be construed to permit CITY, in violation of the limitations on its
reserved authority, to attempt to apply rules, regulations, and policies that are inconsistent with
the Development Plan and the Development Plan Approval(s). Accordingly, SMES desires
assurances that CITY shall not, and CITY agrees that it shall not, further restrict or limit the
Development of the Property in violation of this Agreement except in strict accordance with the
reserved authority described in Section 3.2 hereof, which exercising of CITY's reserved
authority shall not be considered to be a violation of this Agreement. In this regard, from and
after the date that CITY approves the St. Margaret Episcopal School Master Plan for the
Project, if SMES judicially (including by way of a reference proceeding) challenges CITY's
purported exercise of its reserved authority as being in violation of this Agreement, SMES shall
bear the burden of alleging that such purported exercise by CITY of its Reserved Authority is
inconsistent with the Development Plan or the Development Plan Approval(s) and CITY
thereafter shall bear the burden of proof in establishing by a preponderance of the evidence that
such exercise of its Reserved Authority is in accordance with and not a violation of this
Agreement.
3.4 Vested Right. By entering into this Agreement and relying thereupon, SMES is
obtaining certain vested rights to proceed with the Development anticipated by the
Development Plan and the Development Approvals and in accordance with the terms and
conditions of this Agreement (as the same may be amended and supplemented from time to
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time as expressly set forth herein). By entering into this Agreement and relying thereupon,
CITY is securing certain public benefits which enhance the public health, safety, and welfare.
CITY therefore agrees to the following:
3.4.1 No Conflicting Enactments. Except as provided in Section 3.2 of this
Agreement, after the Effective Date neither the City Council nor any other agency of CITY shall
enact a rule, regulation, ordinance, or other measure (collectively, "law") applicable to the
Property which is inconsistent or in conflict with this Agreement. Not by way of limitation of
the foregoing, any law, whether by specific reference to this Agreement or otherwise, shall be
considered to be inconsistent and in conflict with this Agreement if it has any of the following
effects:
(i) It limits or reduces the enrollment, density or intensity of the
Project as provided for in the Development Plan or the Development Plan
Approval(s);
(ii) It applies to the Property, but is not uniformly applied by CITY to
all substantially similar development within CITY; or
(iii) It imposes Development Exactions on the Property other than
those in effect on the Effective Date or as otherwise expressly permitted by
Section 3.2.1 of this Agreement.
3.4.2 Consistent Enactments. By way of enumeration and not limitation, the
following types of laws shall be considered consistent and not in conflict with this Agreement:
(i) Laws that provide for the relocation of structures within the
Property pursuant to an application from SMES;
(ii) Laws that provide for changes in the phasing of the Development
pursuant to an application from SMES; and
(iii) Any law that is expressly authorized by this Agreement.
3.4.3 Initiative Measures. In addition to and not in limitation of the foregoing,
it is the intent of SMES and CITY that no moratorium or other limitation (whether relating to the
Development of all or any part of the Property and whether enacted by initiative or otherwise)
affecting site development permits, precise plans, site development plans, building permits,
occupancy certificates, or other entitlements to use approved, issued, or granted within CITY, or
portions of CITY, shall apply to the Property to the extent such moratorium or other limitation
would restrict SMES's right to Develop the various elements of the Project on the Property in
such order and at such rate as SMES deems appropriate.
3.5 Amendment of Development Agreement.
3.5.1 Initiation of Amendment. Any Party may propose an amendment to this
Agreement, and all Parties agree that it may be beneficial to enter into additional written
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agreements or modifications of this Agreement in connection with the Development of the
separate components of the Development Plan.
Notwithstanding any provision of this Agreement to the contrary, no amendment
to the Development Plan or to any conditions of approval contained therein shall require an
amendment of this Agreement.
3.5.2 Procedure. Except as set forth in Section 3.5.4 below, the procedure for
proposing and adopting an amendment to this Agreement shall be the same as the procedure
required for entering into this Agreement in the first instance.
3.5.3 Consent. Except as expressly provided in this Agreement, any
amendment to this Agreement shall require the written consent of all affected Parties. An
amendment to this Agreement shall not be deemed to affect a portion of the Property if it does
not alter, jeopardize, or impair the rights and does not increase the obligations of SMES that
owns said portion of the Property. No amendment to all or any provision of this Agreement shall
be effective unless set forth in writing and signed by duly authorized representatives of each of
the affected Parties.
3.5.4 [RESERVED]
3.5.5 Operating Memoranda. The Parties acknowledge that refinements and
further development of the Development Plan may demonstrate that changes are appropriate with
respect to the details and performance of the Parties under this Agreement. The Parties desire to
retain a certain degree of flexibility with respect to the details of the Development Plan and with
respect to those items covered in general terms under this Agreement. If and when the Parties
mutually find that changes, adjustments, or clarifications are appropriate to further the intended
purposes of this Agreement, they may, unless otherwise required by law, effectuate such
changes, adjustments, or clarifications without amendment to this Agreement through operating
memoranda mutually approved by the Parties, which, after execution, shall be attached hereto as
addenda and become a part hereof and which may be further changed and amended from time to
time. To the maximum extent permitted by law, the City Manager shall have the authority, on
behalf of CITY, to approve and execute such operating memoranda and the Headmaster Officer
of SMES shall have the authority, on behalf of SMES, to approve and enter into such operating
memoranda. Unless otherwise required by law or by the Development Plan Approval(s), no such
changes, adjustments, or clarifications shall require prior notice or hearing.
3,6 Future Amendments to Development Plan. The following rules apply to future
amendments to the Development Plan:
3.6.1 SMES's Written Consent. Any Development Plan amendment to which
SMES does not agree in writing shall not apply to the Property while this Agreement is in effect.
3.6.2 Concurrent Development Agreement Amendment. Any Development
Plan amendment requiring amendment of this Agreement shall be processed concurrently with
an amendment to this Agreement.
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3.6.3 Effect of Amendment. Except as expressly set forth in the Development
Plan amendment itself or this Agreement, a Development Plan amendment shall not alter, affect,
impair, or otherwise impact the rights, duties, and obligations of the Parties set forth in this
Agreement.
3.7 Future Development Approvals.
3.7.1 Exercise of CITY Discretion. In connection with Future Development
Approvals or any other actions which CITY is expressly permitted to take consistent with this
Agreement relating to the Property, to the maximum extent permitted by law CITY shall exercise
its discretion or take action in a manner which complies and is consistent with the Development
Plan, any Development Plan Approval(s) issued by CITY consistent with this Agreement prior to
the date CITY takes final action on the Future Development Approval then in question, and the
other terms and conditions set forth herein.
3.7.2 Concurrent Development Agreement Amendment. Any Future
Development Approval requiring amendment of this Agreement, as provided for in Section 3.5
hereof, shall be processed concurrently with an amendment to this Agreement.
3.7.3 Effect of Future Development Approvals. To the maximum extent
permitted by law and except as expressly set forth in this Section 3.7, a Future Development
Approval shall not alter, affect, impair, or otherwise affect the rights, duties, and obligations of
any of the Parties set forth in this Agreement. To the extent a Future Development Approval is
approved in accordance with Sections 3.7.1 and 3.7.2, the Future Development Approval shall
constitute for all purposes a Development Plan Approval.
4. Miscellaneous Obligations of the Parties.
4.1 SMES's Rights and Obligations With Respect to Implementing St. Margaret's
Episcopal School Master Plan.
In carrying out the Master Plan, SMES shall comply with the following:
1. The Project shall conform to CITY's goal to manage growth through the
use of, among other things, comprehensive planning and design, project-wide continuity
of landscaping and architectural design, state-of-the-art development standards, and
planning concepts.
2. The traffic and circulation elements of the Development Plan will conform
to CITY's General Plan and will be designed to reduce the impact of the average daily
trips generated by the development of the Project on arterial roads and thoroughfares
adjacent to the Expansion Parcels by implementing the Mitigation Measures set forth in
the Mitigation Monitoring and Reporting Program for the Project.
3. As a religious organization, SMES is exempt from paying property taxes
on land dedicated to educational and religious uses. SMES does pay property taxes today
on the Expansion Parcels, which in the future, upon conversion to school uses, would be
subject to the property tax exemption. Also, the CITY would potentially lose sales tax
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revenue as a result of the Project's removal of commercial buildings from the Expansion
Parcels and development of the Expansion Parcels for non-commercial uses.
Notwithstanding the SMES exemption from property taxes by virtue of its status as a
religious organization, in exchange for CITY's agreement to enter into and perform its
obligations set forth in this Agreement, SMES has agreed that SMES shall make an
annual payment to CITY in an amount calculated as set forth in this Section 4.1.3,
providing substantial benefits to CITY and its residents:
In order to fully mitigate potential impacts of the lost property tax and
sales tax revenues associated with the Development Plan and provide financial benefits to
CITY and its residents, SMES shall pay to CITY each year an amount calculated as
follows for CITY's General Fund:
(1) $25,000 by September 30, 2011
(2) $50,000 by September 30, 2012
(3) $75,000 by September 30, 2013 and by September 30 of every
year thereafter
(4) The above payments shall be increased by 2% compounded
annually beginning October 1, 2013
This is described further in Exhibit "D".
4. The Project will result in the expansion of the existing St. Margaret's
Episcopal School which will be of benefit to CITY and its residents by providing
additional educational resources to the community. As of this date, approximately 250
students (20% of the students enrolled at St. Margaret's Episcopal School) are residents
of San Juan Capistrano, and 700 students (57% of currently enrolled students) would
otherwise attend the Capistrano Valley Unified School District. Compliance with the
student enrollment cap established by Conditional Use Permit 02-14 ("Cap") shall be
determined annually, based on SMES's enrollment count as reported to the California
Department of Education. In order to encourage enrollment of high-need San Juan
Capistrano Students, SMES shall be entitled to enroll students who will be exempt from
the Cap, as detailed below and as described further in Exhibit "D":
(1) SMES may, in its sole discretion, enroll up to thirty (30) students who are
residents of San Juan Capistrano and are receiving financial aid of 80% or more
of tuition fees ("SJC80 Students"); and
(2) For each SJC80 Student in excess of twenty (20) (i.e. for the 21" through
30th SJC80 Student enrolled), SMES may, in its sole discretion, enroll up to one
additional student ("Non-SJC80 Student") up to a maximum of ten (10) Non-
SJC80 Students.
(3) The SJC80 students (up to 30) and Non-SJC80 students (up to 10) allowed
by this Section 4.1.4 shall be exempt from the Cap established by Conditional Use
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Permit 02-14 and shall not be included in SMES's annual calculation of full time
equivalent students.
The traffic and other potential impacts associated with the increased number of students
authorized by this Section 4.1.4 are mitigated to a level below significant by the
Development Plan's removal of commercial buildings and commercial uses from the
Expansion Parcels.
5. The Project will result in dedication of an easement to CITY for a multi-
use trail connector along .La Novia Avenue along the frontage of SMES upon CITY's
approval of a final trail alignment as part of CITY's General Plan.
6. The Project will result in a shared parking agreement with CITY providing
an additional parking lot to serve CITY's Cook Park and Trails that will provide
substantial benefits to CITY and its residents.
7. SMES will allow the Ortega Equestrian Center ("OEC") to continue
operating on the Project site under the terms of its existing lease with SMES until May
31, 2012, or any later date agreed upon in writing by both SMES and OEC, and will work
with OEC to accommodate relocation of the facilities in an orderly manner by May 31,
2012, or any later date agreed upon in writing by both SMES and OEC.
4.2 Future Development Approvals. To the maximum extent permitted by law CITY
agrees to expedite the processing of the Future Development Approvals, and to use its reasonable
good faith efforts to approve or adopt the Future Development Approvals in form and content
reasonably satisfactory to SMES; provided, however, that nothing in this Section 4.2 shall, or
shall be construed to, constitute a promise or commitment by CITY to approve the Future
Development Approvals or to approve the same with or without any particular requirements or
conditions, and provided further that prior to the date that the Future Development Approvals
may be so approved, CITY reserves its full legislative police power authority with respect
thereto consistent with its obligations set forth elsewhere in this Agreement. To the extent a
Future Development Approval is approved that pertains to the Property, the Future Development
Approval shall constitute for all purposes a Development Plan Approval.
5. Indemnification.
Except to the extent of the gross negligence or willful misconduct of CITY and its agents,
officers, contractors, attorneys, and employees (the "Indemnified Parties"), SMES, and with
respect to the portion of the Property transferred to them, the Development Transferee agree: to
indemnify, defend, and hold harmless the Indemnified Parties from and against each and every
claim, action, proceeding, cost, fee, legal cost, damage, award or liability of any nature arising
from alleged damages caused to third parties and alleging that CITY is liable therefor as a direct
or indirect result of CITY's approval of or performance under this Agreement. The duties of
SMES under this Section 5 are solely subject to and conditioned upon the Indemnified Parties'
written request to SMES to defend and/or indemnify CITY. Without in any way limiting the
provisions of this Section 5, the Parties hereto agree that this Section 5 shall be interpreted in
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accordance with the provisions of California Civil Code Section 2778 in effect as of the
Effective Date.
6. Relationship of Parties.
The contractual relationship between CITY and SMES is such that SMES is an
independent contractor and not an agent or employee of CITY. CITY and SMES hereby
renounce the existence of any form of joint venture or partnership between them, and agree that
nothing contained in this Agreement or in any document executed in connection with the
Property shall be construed as making CITY and SMES joint venturers or partners.
7. Amendment or Cancellation of Agreement.
This Agreement may be amended or canceled in whole or in part only by mutual consent
of the Parties in the manner provided for in Government Code Section 65868. No amendment or
modification of this Agreement or any provision hereof shall be effective unless set forth in
writing and signed by duly authorized representatives of each Parry hereto. This provision shall
not limit any Party's remedies as provided by Section 9.
8. Periodic Review of Compliance with Agreement.
8.1 Periodic Review. CITY and SMES shall review this Agreement at least once
every 12-month period from the date this Agreement is executed, in September or such other
month as the City may notify SMES. CITY shall notify SMES in writing of the date for review
at least thirty (30) days prior thereto. Such periodic review shall be conducted in accordance
with Government Code Section 65865.1.
8.2 Good Faith Compliance. During each periodic review, SMES shall be required to
demonstrate good faith compliance with the terms of this Agreement, including, but not limited
to: its compliance with SMES's enrollment Cap, calculated in accordance with Section 4.1.4
above; and the annual payment required by Section 4.1.3 above. SMES agrees to furnish such
reasonable evidence of good faith compliance as CITY, in the exercise of its reasonable
discretion, may require. If requested by SMES, CITY agrees to provide to SMES a certificate
that SMES or its Development Transferee is in compliance with the terms of this Agreement,
provided SMES reimburses CITY for all reasonable and direct costs and fees incurred by CITY
with respect thereto.
8.3 Failure to Conduct Annual Review. The failure of CITY to conduct the annual
review shall not be a Default by SMES, nor shall any such failure alter, suspend, or terminate
any of the Parties' other rights and obligations hereunder. Further, SMES shall not be entitled
to any remedy for a failure by CITY to conduct this annual review.
8.4 Initiation of Review by City Council. In addition to the annual review, the City
Council may at any time initiate a review of this Agreement by giving written notice to SMES.
Within thirty (30) days following receipt of such notice, SMES shall submit evidence to the
City Council of SMES's good faith compliance with this Agreement and such review and
determination shall proceed in the same manner as is provided in Sections 8.1 and 8.2 and the
Development Agreement Legislation for the annual review. The City Council shall initiate its
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review pursuant to this Section 8.4 only if it has probable cause to believe CITY's general
health, safety, or welfare is at risk as a result of specific acts or failures to act by SMES.
8.5 Administration of Agreement. Any final decision by the CITY's staff concerning
the interpretation and administration of this Agreement and Development of the Property in
accordance herewith may be appealed by SMES to the City Council, provided that any such
appeal shall be filed with the City Clerk within ten (10) days after SMES receives written notice
that the staff decision is final. The City Council shall render, at a noticed public hearing, its
decision to affirm, reverse, or modify the staff decision within thirty (30) days after the appeal
is so filed.
8.6 Availability of Documents. If requested by SMES, CITY agrees to provide to
SMES copies of any documents, reports, or other items reviewed, accumulated, or prepared by
or for CITY in connection with any periodic compliance review by CITY, provided SMES
reimburses CITY for all reasonable and direct costs and fees incurred by CITY with respect
thereto. CITY shall respond to SMES's request on or before ten (10) business days have
elapsed from CITY's receipt of such request.
9. Events of Default: Remedies and Termination.
9.1 Defaults by SMES. If CITY determines on the basis of a preponderance of the
evidence that SMES has not complied in good faith with the terms and conditions of this
Agreement, CITY may, by written notice to SMES, specify the manner in which SMES has
failed to so comply and state the steps SMES must take to bring itself into compliance. If,
within sixty (60) days after the effective date of notice from CITY specifying the manner in
which SMES has failed to so comply, SMES does not commence all steps reasonably necessary
to bring itself into compliance as required and thereafter diligently pursue such steps to
completion, then SMES shall be deemed to be in default under the terms of this Agreement (a
"Default"), In such event, CITY may terminate this Agreement pursuant to Government Code
Section 65865.1 with respect to the Property. In material event of Default by SMES, except as
provided in Section 9.3, CITY's sole remedy for any breach of this section 9.1 shall be CITY's
right to terminate this Agreement.
9.2 Defaults by CITY. If SMES determines on the basis of a preponderance of the
evidence that CITY has not complied in good faith with the terms and conditions of this
Agreement, SMES may, by written notice to CITY, specify the manner in which CITY has
failed to so comply and state the steps CITY must take to bring itself into compliance. If,
within sixty (60) days after the effective date of notice from SMES specifying the manner in
which CITY has failed to so comply, CITY does not commence all steps reasonably necessary
to bring itself into compliance as required and thereafter diligently pursue such steps to
completion, then CITY shall be deemed to be in default under the terms of this Agreement (a
"Default"), In such event, SMES may terminate this Agreement with respect to the Property
and, in addition, may pursue any other remedy available at law or equity, including specific
performance as set forth in Section 9.3.
9.3 Specific Performance Remedy. Due to the size, nature, and scope of the
Development Plan, it will not be practical or possible to restore the Property to its pre-
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development condition once implementation of this Agreement has begun. After such
implementation, SMES may be foreclosed from other choices they may have had to utilize the
Property and provide for other benefits. SMES has invested significant time and resources and
performed extensive planning and processing of the Development Plan and Development Plan
Approval(s) in agreeing to the terms of this Agreement and will be investing even more
significant time and resources in implementing the Development Plan and Development Plan
Approval(s) in reliance upon the terms of this Agreement, and it is not possible to determine the
sum of money which would adequately compensate SMES for such efforts. For the above
reasons, CITY and SMES agree that damages would not be an adequate remedy if CITY fails to
carry out its obligations under this Agreement and that SMES shall have the right to seek and
obtain injunctive relief and specific performance as a remedy for any Default by CITY
hereunder. CITY and SMES further acknowledge that, if SMES fails to carry out its
obligations under this Agreement, CITY shall have the right to refuse to issue any permits or
other approvals which SMES otherwise would have been entitled to pursuant to this Agreement
that are related to and depend upon SMES's performance hereunder. Therefore, CITY's remedy
specific performance pursuant to Section 9.1, or else the remedy of terminating this Agreement
as to the portion of the Property as to which a material breach of Section 9.1 exists shall be
sufficient in most circumstances if SMES fails to carry out its obligations hereunder.
Notwithstanding the foregoing, if CITY issues a permit or other approval pursuant to this
Agreement in reliance (explicitly stated in writing) upon a specified condition being satisfied in
the future, and if SMES then fails to satisfy such condition, CITY shall be entitled to specific
performance for the sole purpose of causing SMES to satisfy such condition. CITY's right to
specific performance shall be limited to those circumstances set forth above, and CITY shall
have no right to seek specific performance to cause SMES to otherwise proceed with the
Development of the Property in any manner.
9.4 Institution of Legal Action. Except to the extent a non-Defaulting Party's rights
or remedies are limited by the express provisions set forth herein, SMES or CITY may institute
legal action to cure, correct, or remedy any Default, to enforce any covenants or agreements
herein, to enjoin any threatened or attempted violation hereof, to recover damages for any
Default, or to obtain any other remedies consistent with the purpose of this Agreement. Such
legal action shall be heard by a reference from the Orange County Superior Court.
9.5 Estoppel Certificates. Any Party or the holder or prospective holder of a
mortgage or deed of trust secured by an interest in any portion of the Property (a "holder") may
at any time during the Term of this Agreement deliver written notice to the other Party
requesting an estoppel certificate(the "Estoppel Certificate") stating:
(i) The Agreement is in full force and effect and is a binding obligation of the
Parties;
(ii) This Agreement has not been amended or modified either orally or in
writing or, if so amended, identifying the amendments;
(iii) No Default exists hereunder, nor would any Default exist with the passage
of time or the giving of notice, or both, or, if a Default or failure does exist, the nature
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thereof and the actions required to be taken by the non-performing Party to cure the
Default or prevent the same from occurring; and
(iv) Any other matter affecting the status of the rights and obligations of the
Parties hereunder as to which the requesting Party or the holder may inquire.
A Party receiving a request for an Estoppel Certificate shall provide a signed certificate to
the requesting Party or holder within thirty (30) days after receipt of the request. The City
Manager or any person designated by the City Manager may sign Estoppel Certificates on behalf
of CITY. The Headmaster of SMES may sign on behalf of SMES. An Estoppel Certificate may
be relied on by the holder and by Development Transferees.
In the event that one Party requests an Estoppel Certificate from another Party of Parties,
the requesting Party shall reimburse the other Party or Parties for all reasonable and direct costs
and fees incurred by such Party or Parties with respect thereto.
10. Waivers and Delays.
10.1 No Waiver. Failure by a Party to insist upon the strict performance of any of the
provisions of this Agreement by another Party, and failure by a Party to exercise its rights upon
a Default by another Party hereto, shall not constitute a waiver of.such Party's right to demand
strict compliance by such other Party or Parties in the future for the same, similar, or any
different Default.
10.2 Third Parties. The Parties' respective performance obligations hereunder shall not
be delayed or excused because of any act or failure to act by a third person, except as provided
in Section 10.3.
10.3 Force Maieure. Notwithstanding any other provision set forth in this Agreement
to the contrary, SMES shall not be deemed to be in Default where failure or delay in
performance of any of its obligations under this Agreement is caused by floods, earthquakes,
other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties
beyond SMES's control, SMES's inability to obtain required permits or approvals from
governmental agencies with jurisdiction over the applicable portions of the Property and the
Project, government regulations (including, without limitation, local, state, and federal
environmental and natural resource regulations), voter initiative or referenda, moratoria
(including, without limitation, any "development moratorium" as that term is applied in
Government Code Section 66452.6), litigation, or any other causes that are without the fault
and beyond the reasonable control of SMES.
10.4 Extensions. The Term of this Agreement and the times for performance by SMES
or CITY of any of its obligations hereunder or pursuant to the Development Plan Approval(s)
shall be extended by the period of time that any of the events described in Section 10.3 exist
and/or prevent performance of such obligations. In addition, the Term shall be extended for
delays arising from the following events for a time equal to the duration of each delay which
occurs during the Term:
-21-
(i) The period of time after the Effective Date during which litigation
challenging the validity or enforceability of this Agreement or related to the Development
Plan Approval(s) or having the actual effect of delaying implementation of the
Development Plan is pending, including litigation pending on the Effective Date. This
period shall include any time during which appeals may be filed or are pending; and
(ii) Any delay resulting from the acts or omissions of CITY or any other
governmental agency or public utility and beyond the reasonable control of SMES.
10.5 Notice of Delay. SMES shall give notice to CITY of any delay which SMES
believes to have occurred as a result of the occurrence of any of the events described in Section
10.3. For delays of six months or longer, this notice shall be given within a reasonable time
after SMES becomes aware that the delay has lasted six months or more. In no event, however,
shall notice of a delay of any length be given later than thirty days after the end of the delay or
thirty days before the end of the Term, whichever comes first.
11. Notices.
All notices required or provided for under this Agreement shall be in writing and
delivered in person or sent by certified mail, postage prepaid, return receipt requested.
Notices to CITY shall be addressed as follows:
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attention: City Manager
with a copy to:
Woodruff, Spradlin& Smart
555 Anton Boulevard, Suite 1200
Costa Mesa, CA 92626
Attention: Omar Sandoval, City Attorney
Notices to SMES shall be addressed as follows:
The Headmaster
Saint Margaret's of Scotland Episcopal School
31641 La Novia
San Juan Capistrano, CA 92675
with a copy to:
Gibson Dunn & Crutcher, LLP
3161 Michelson Drive
Irvine, CA 92612
Attention: Joseph P. Busch III, Esq.
-22-
Any notice given as required herein shall be deemed given only if in writing and upon
delivery personally or by independent courier service. A Party may change its address for
notices by giving notice in writing to the other Parties as required herein and thereafter notices
shall be addressed and transmitted to the new address.
CITY shall additionally provide written notice of any Default by SMES (including, as
applicable, any Development Transferee) and any act or omission by SMES (or such
Development Transferee) that would constitute a Default with the passage of time or giving of
notice or both, to the holder of any mortgage or deed of trust secured by all or any interest in the
Property which (i) delivers a written notice to CITY requesting such notices and (ii)provides
CITY with such holder's address(es) for notice purposes.
12. Attorneys' Fees.
If legal action is brought by one Party against another Party for breach of this Agreement,
including actions derivative from the performance of this Agreement, or to compel performance
under this Agreement, the prevailing Party shall be entitled to an award of its costs, including
reasonable attorneys' fees, and shall also be entitled to recover its contribution to the costs of the
referee referred to in Section 9.4 above as an item of damage and/or recoverable costs.
13. Recording.
This Agreement and any amendment or cancellation hereto shall be recorded against the
Property at no cost to CITY, in the Official Records of Orange County by the City Clerk within
the period required by Section 65868.5 of the Government Code. In addition, at such time that
SMES acquires fee title to any of the Expansion Parcels and such parcel(s) is (are) added to this
Agreement as provided in Section 3.5.4 this Agreement, this Agreement and any amendment or
cancellation hereto shall be recorded, at no cost to CITY, with respect to any such Expansion
Parcel(s). Notwithstanding the foregoing, in no event shall any failure or delay in recording this
Agreement and any amendment to this Agreement limit or restrict the validity or enforceability
of this Agreement.
14. Effect of Agreement on Title.
14.1 Effect on Title. The Parties agree that this Agreement shall not continue as an
encumbrance against the Property once the Agreement has terminated. Notwithstanding the
foregoing, the provisions of Sections 4.1.3 and 4.1.4 shall remain effective coterminous with
Conditional Use Permit 02-14.
14.2 Encumbrances and Lenders' Rights. The Parties hereby agree that this Agreement
shall not prevent or limit SMES (including without limitation any Development Transferee
hereunder), at any time or from time to time in any manner, at its or their sole discretion, from
encumbering the Property, the improvements thereon, or any portion thereof with any
mortgage, deed of trust, sale and leaseback arrangement, or other security device. CITY
acknowledges that the holder of any such security interest in all or any portion of the Property
may require certain clarifications, interpretations, or modifications to this Agreement or the
Development Plan and CITY agrees, upon request, from time to time, to meet with the
applicable Party and/or representatives of any such holder to negotiate in good faith any such
-23-
request for clarification, interpretation, or modification. CITY further agrees that it will not
unreasonably withhold its consent to any such requested clarification or interpretation to the
extent such clarification or interpretation is consistent with the intent and purpose of this
Agreement. A Default under this Agreement shall not defeat, render invalid, diminish, or
impair the lien of any such holder.
The mortgagee of a mortgage or beneficiary of a deed of trust or holder of any other
security interest in the Property or any portion thereof and its or their successors and assigns,
including without limitation the purchaser at a judicial or non judicial foreclosure sale or a
person or entity which obtains title by deed-in-lieu of foreclosure (collectively, a "holder") shall
be entitled to receive a copy of any notice of Default (as defined in Section 9.1 hereof) delivered
to SMES as to whose portion of the Property such a Default exists and, as a pre-condition to the
institution of legal proceedings or termination proceedings, CITY shall deliver to all such holders
written notification of any Default by SMES in the performance of its obligations under this
Agreement which is not cured within sixty (60) days (the "Second Default Notice") and shall
allow the holder(s) an opportunity to cure such Defaults as set forth herein. The Second Notice
of Default shall specify in detail the alleged Default and the suggested means to cure it. After
receipt of the Second Default Notice, each such holder shall have the right, at its sole option,
within ninety (90) days to cure such Default or, if such Default cannot reasonably be cured
within that ninety (90) day period, to commence to cure such Default, in which case no Default
shall exist and CITY shall take no further action. Notwithstanding the foregoing, if such Default
-shall be a Default which can only be remedied by such holder obtaining possession of the
applicable portion of the Property, and such holder seeks to obtain possession, such holder shall
have until ninety (90) days after the date obtaining such possession to cure or, if such Default
cannot reasonably be cured within such period, then to commence to cure such Default. Further,
a holder shall not be required to cure any non-curable Default of SMES, and any such Default
shall be deemed cured if any lender obtains possession.
15. Severability of Terms.
If any term, provision, covenant, or condition of this Agreement shall be determined
invalid, void, or unenforceable, the remainder of this Agreement shall not be affected thereby if
the tribunal finds that the invalidity was not a material part of consideration for the affected Party
or Parties. The covenants contained herein are mutual covenants. The covenants contained
herein constitute conditions to the concurrent or subsequent performance by each Party benefited
thereby of the covenants to be performed hereunder by such benefited Party.
16. Subsequent Amendment to Authorizing Statute.
This Agreemegt has been entered into in reliance upon the provisions of the Development
Agreement Legislation in effect as of the Effective Date. Accordingly, to the extent that
subsequent amendments to the Development Agreement Legislation would affect the provisions
of this Agreement, such amendments shall not be applicable to this Agreement unless necessary
for this Agreement to be enforceable or required by law or unless this Agreement is modified
pursuant to the provisions set forth in this Agreement and Government Code Section 65868 as in
effect on the Effective Date.
-24-
L
17. Rules of Construction and Miscellaneous Terms.
17.1 Interpretation and Governing Law. The language in all parts of this Agreement
shall, in all cases, be construed as a whole and in accordance with its fair meaning. This
Agreement and any dispute arising hereunder shall be governed and interpreted in accordance
with the internal laws of the State of California, with regard to conflict of laws rules. The
Parties understand and agree that this Agreement is not intended to constitute, nor shall be
construed to constitute, an impermissible attempt to contract away the legislative and
governmental functions of CITY, and in particular, CITY's police powers. In this regard, the
Parties understand and agree that this Agreement is a current exercise of CITY's police powers
and except as expressly provided for herein this Agreement shall not be deemed to prevent the
future exercise by CITY of its lawful governmental powers over the Property.
17.2 Section Headings. All section headings and subheadings are inserted for
convenience only and shall not affect any construction or interpretation of this Agreement.
17.3 Gender. The singular includes the plural; the masculine gender includes the
feminine; "shall" is mandatory, "may" is permissive.
17.4 Time of Essence. Time is of the essence regarding each provision of this
Agreement as to which time is an element.
17.5 Recitals. All Recitals set forth herein are incorporated in this Agreement as
though fully set forth herein.
17.6 Entire Agreement. This Agreement constitutes the entire agreement between and
among the Parties with respect to the subject matter hereof, and this Agreement supersedes all
previous negotiations, discussions, and agreements between and among the Parties with respect
thereto.
18. Not for Benefit of Third Parties.
This Agreement and all provisions hereof are for the exclusive benefit of CITY and
SMES and their respective Development Transferees and shall not be construed to benefit or be
enforceable by any third party, excepting only to the extent of the limited rights provided to the
holders of security interests in all or a portion of the Property.
19. Cooperation in Event of Legal Challenge.
CITY agrees to cooperate with SMES as may be needed in order to keep this Agreement
in full force and effect during the entire Tenn. In the event of any legal action instituted by a
third party or other governmental entity or official challenging the validity or enforceability of
any provision of this Agreement or any of the Development Plan Approval(s) (including without
limitation any Future Development Approvals after the same have been issued by CITY), the
Parties hereby agree to cooperate in defending such action and, in this regard, CITY shall not
allow its default to be taken in such legal action or otherwise compromise the legal action
without SMES's prior written consent. In the event of any such litigation, to the maximum
extent permitted by law this Agreement shall remain in full force and effect while such litigation,
-25-
including any appellate review, is pending. Notwithstanding the foregoing, SMES shall be
responsible for all costs, including but not limited to attorney's fees, costs, expert witness fees,
and the like, incurred with respect to any such litigation.
[Remainder of Page Intentionally Left Blank]
-26-
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day
and yea77, 2010
b
Dated: "CITY"
CITY OF N AN CAPISTRANO, a
municipal co oration
By:
Name: Dr. L ndres Uso
Title: Mayor
ATTESa
Cit Cle
A O EDASTOF(L
City Attorney
Dated: ' 2010 "SMES"
ST. MARGARET'S OF SCOTLAND
EPISCOPAL SCHOOL, a California non-profit
public benefit corporation
By:
Nam . Marcus D. Hurlbut
Title: Headmaster
By:
Name: David J. Bush
Title: Director of Finance & Operations
-27-
PUBLIC AGENCY FORM OF ACKNOWLEDGEMENT
State of California )
County of Orange ) ss.
City of San Juan Capistrano )
(Gov't Code 40814 & Civil Code 118 1)
On April 1, 2010, before me, Maria Morris, City Clerk, personally appeared
Dr.Londres Uso,Mayor,who proved to me on the basis of satisfactory evidence to the be 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, and that by his/her/there signature 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.
(SEAL)
WI S hand and official seal.
M 'a rri , City Cl k
OPTIONAL
Capacity Claimed by Signers Description of Attached Document
Title or Type of Document
Officer title
Development Agreement (St. Margaret's
Mayor Episcopal School Expansion Project) by and
between City of San Juan Capistrano and St.
Signers are Representing Margaret of Scotland Episcopal School
City of San Juan Capistrano
Original
CALIFORNIA ALL-PURPOSE
CERTIFICATE OF ACKNOWLEDGMENT
State of California
County of h
On ,ZD/D before me, T J. I1721AJeier
^� ' / I
(Here insert name and title of the-officer)
icer)
I'1
personally appeared M6MCUS 94blCb 017d I)QV/R —T Ush
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s)istlare subscribed to
the within instrument and acknowledged to me that hetshe/they executed the same in 1364w/their authorized
capacity(ies), and that by hisAw/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.
o.uttz►t� rt
WITNESS my ha and o ial seal. a Notar Pubk•CiFfifMill o
(Notary Seal)
Signature of Notary Pu lic
ADDITIONAL OPTIONAL INFORMATION
INSTRUCTIONS FOR COMPLETING THIS FORM
Any acknowledgment completed in California must contain verbiage exactly as
DESCRIPTION OF THE ATTACHED DOCUMENT appears above in the notary section or a separate acknowledgment form must be
�D m ���� properly completed and attached to that document. The only exception is ti
�,
document g e be recorded outside e pritedCalifornia.n/n such instances, any alternative
_iqvC%/— Titl r deter pti fatpgbed dncuq /y acknowledgment verbiage the
may be primed et such a document o long as the
verbiage does not require the notary to do something that is illegal for a notary in
California ('.e. certifying the authorized capacity of the signer). Please check the
QT �n nn document carefully for proper notarial wording and attach this form f required.
9Ef or�t��attache ocu)ne �t nued)
Num of Pages Document
Date • State and County information must be the arate and County where the document
signer(s)personally appeared before the notary public for acknowledgment.
• Date of notarization must be the date that the signer(s)personally appeared which
must also be the same date the acknowledgment is completed
(Additional information) • The notary public must print his or her name as it appears within his or her
commission followed by a comma and then your title(notary public).
• Print the name(s) of document signers) who personally appear at the time of
notarization.
CAPACITY CLAIMED BY THE SIGNER • Indicate the correct singular or plural forms by crossing off incorrect forms It e.
❑ Individual(S) he/she/they-is/ere)or circling the correct forms.Failure to correctly indicate this
information may lead to rejection of document recording.
❑ Corporate Officer • The notary seal impression must be clear and photographically reproducible.
Impression must not cover text or lines. If seal impression smudges, re-seal if a
(Title) sufficient area permits,otherwise complete a different acknowledgment form.
❑ Partner(s) • Signature of the notary public must match the signature on file with the office of
the county clerk.
1:1 Attorney-in-Fact Additional information is not required but could help to ensure this
❑ Trustee(S) acknowledgment is not misused or attached to a different document.
❑ Other Indicate title or type of attached document,number of pages and date.
Indicate the capacity claimed by the signer. If the claimed capacity is a
corporate officer,indicate the title(i.e.CEO,CFO,Secretary).
• Securely attach this document to the signed document
2008 Version CAPA v 12 M07 800-873-9865 www.NotaryClasses.com
EXHIBIT "A"
LEGAL DESCRIPTION AND SITE PLAN OF THE SMES PROPERTY
That certain real property located in the City of San Juan Capistrano, County of Orange, State of California, described as follows:
CAMPUS PARCELS:
Location APN Acres Attached Map Reference
31641 La Novia 666-272-09 11.90 A
27461 Calle Arroyo 666-251-04 1.21 B
27481 Calle Arroyo 666-251-05 1.30 C
Calle Arroyo 666-251-06 3.07 D
Ortega Village Center 666-261-11 0.33 E
Ortega Village Center 666-261-10 0.36 F
Ortega Village Center 666-261-09 0_65 G
Total 18.82
EXPANSION PARCELS:
Location APN Acres Attached Map Reference
31732 Rancho Viejo Road 666-261-03 1.11 H
31658 Rancho Viejo Road 666-261-02 0.47 I
31648 Rancho Viejo Road 666-261-01 0.38 J
27252 Calle Arroyo 666-232-04 5.20 K
Cal le Arroyo 666-123-01&2 0.91 L
Total 8.07
- 1 -
EXHIBIT "A"
Leval Description of ST. Margaret's Episcopal Properties
Campus Parcels: A through G , !
ORTEGA
Expansion Parcels: H through L
Y1
I nig€I
- i��11R119111lF1A _- IlAAR1TfIIIIRfIAIh�lA!!I �,� �, � �,
-
`.'
.. . '
l:A i�i�l
CALLE
ARROVO
.fir
EXHIBIT "B"
NARRATIVE DESCRIPTION OF THE PROJECT
• Construction of a 41,777 SF Performing Arts Education Center and adjacent parking lot
reconfiguration, on the site of the current 7th and 8`h grade classrooms and Middle School
administration offices
• Construction of a 24,116 SF Middle School classroom building and adjacent pedestrian
area reconfiguration, on the site of two buildings in the Ortega Business Center
• To facilitate construction of the above, installation of new temporary modular classroom
buildings to house displaced 7`h and 8th grade students
• Renovation of existing Church administrative building and adjacent courtyard
• Reconfiguration of parking space in the Ortega Business Center
• Construction of a new satellite parking facility at La Novia and Calle Arroyo
• Grant of easement over school property to facilitate City construction of a multi-use trail
along La Novia
• Conversion of existing `Sillers Hall' multi-purpose room to a dedicated all-school dining
facility
• Renovation, and possible 10,500 SF second-story expansion, of the Lower School
classroom buildings
• Renovation of the existing Campaigne Center building including a 1,000 SF addition
• Renovation of the second floor of the existing Gateway building
• Renovation and 3,000 SF expansion of the Chapel
• Development of 5 acres of land on Calle Arroyo, currently leased to the Ortega
Equestrian Center, as a multi-sport athletic field, with a 3,000 SF maintenance and
restroom building
• Establishment of calculation procedure for SMES enrollment cap of 1,194 full-time
equivalent students, to exclude the students that would otherwise exceed the cap as
described in Exhibit D.
- 1 -
EXHIBIT "C"
DEVELOPMENT PLAN APPROVALS
1. Conditional Use Permit 02-14
2. General Plan Amendment 06-03
3. Rezone 06-06, 07-05
4. Architectural Control 07-22
5. St. Margaret's Episcopal School Master Plan
6. Development Agreement (Ordinance No.
7. Mitigated Negative Declaration
8. Future Development Approvals (as and when, and in the form and substance, adopted by
CITY).
- 2 -
EXHIBIT "D"
FURTHER DESCRIPTION OF ENROLLMENT CAP AND CITY FEE PAYMENTS
# of # of Enrollment Cap Total
SJC80 Non- Students
students SJC80 Enrolled
students
1,194 Full-Time 1,194
Terms of Conditional Use Permit 02-14 0 0 Equivalent
Students
Terms of this Agreement — Enrollment
Cap
The first twenty (20) enrolled SJC80 0 - 20 0 1,194 Full-Time Up to 1,214
students shall be excluded from the Equivalent
enrollment cap Students Plus up
to 20 SJC80
Students*
Up to an additional ten (10) enrolled SJC80 21-30 1-10 1,194 Full-Time Up to 1,234
students shall be excluded from the Equivalent
enrollment cap. For each such additional Students Plus up
SJC80 student, one Non-SJC80 student may to 30 SJC80
be enrolled and excluded from the Students and up
enrollment cap to 10 Non-SJC80
Students*
Annual Fee to
Terms of this Agreement — Annual City City
Fee
September 30, 2011 $25,000
September 30, 2012 $50,000
September 30, 2013 $75,000
September 30, 2014 and every year $75,000 + 2%
thereafter Compounded
annually
* The additional SJ80 students (up to 30) and Non-SJ80 students (up to 10) allowed pursuant to
Section 4.1.4 of the Development Agreement shall be exempt from the Cap established by
Conditional Use Permit 02-14 and shall not be included in SMES's annual calculation of full
time equivalent students.
- 3 -
ORDINANCE NO. 968
AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO
APPROVING AND ADOPTING A DEVELOPMENT AGREEMENT FOR
THE SAINT MARGARETS EPISCOPAL SCHOOL MASTER PLAN
PROJECT (ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL)
The City Council of the City of San Juan Capistrano hereby ordains as follows:
SECTION 1. Recitals & Findings
1. St. Margaret of Scotland Episcopal School has requested approval of a
Development Agreement, entitled "Development Agreement (St. Margaret's
Episcopal School Expansion Project) by and between the City of San Juan
Capistrano and St. Margaret of Scotland Episcopal School'; and,
2. The City's Environmental Administrator reviewed the Initial Study prepared by
Ed Almanza & Associates pursuant to Section 15063 and 15064 of the California
Environmental Quality Act (CEQA) Guidelines; has issued a Mitigated Negative
Declaration pursuant to Section 15070 of those guidelines; has caused a Notice
of Negative Declaration to be posted and mailed to affected property owners
pursuant to Section 15072 of those guidelines; and has otherwise complied with
all applicable provisions of the California Environmental Quality Act (1970); and
all mitigation measures have been included herein; and,
3. The Planning Commission conducted duly-noticed public hearings on June 23,
2009, July 14, 2009, December 8, 2009, January 12, 2010, and January 26,
2010 pursuant to Title 9, Land Use Code, Section 9-2.335, Public Hearing
Procedures to consider the environmental determination and documentation
pursuant to Section 15074 of the California Environmental Quality Act, and to
consider public testimony on the proposed project and has considered all
relevant public comments; and,
4. The City Council conducted a duly-noticed public hearing on February 16, 2010
pursuant to Title 9, Land Use Code, Section 9-2.335, Public Hearing Procedures
to consider the environmental determination and documentation pursuant to
Section 15074 of the California Environmental Quality Act, and to consider public
testimony on the proposed project, has considered all relevant public comments.
SECTION 2. Amendment.
Pursuant to Government Code sections 65864 et seq., the City Council does
hereby approve and adopt the "Development Agreement (St. Margaret's Episcopal
School Expansion Project) by and between the City of San Juan Capistrano and St.
Margaret of Scotland Episcopal Schoof', which is attached as Exhibit A, and
incorporated herein by reference and "Covenant and Agreement Regarding Mitigation of
1 0968
Financial Impacts and Calculation of Student Enrollment Cap" which is attached as
Exhibit B, and incorporated herein by reference. The Mayor is hereby authorized to
execute said agreement on behalf of the City of San Juan Capistrano.
SECTION 3. Effective Date.
This Ordinance shall take effect and be in force thirty (30) days after its passage.
SECTION 4. City Clerk's Certification
The City Clerk shall certify to the adoption of this Ordinance and cause the same
to be posted .at the duly designated posting places within the City and published once
within fifteen (15) days after passage and adoption as required by law; or, in the
alternative, the City Clerk may cause to be published a summary of this Ordinance and
a certified copy of the text of this Ordinance shall be posted in the Office of the City
Clerk five (5) days prior to the date of adoption of this Ordinance; and, within fifteen (15)
days after adoption, the City Clerk shall cause to be published the aforementioned
summary and shall post a certified copy of this Ordinance, together with the vote for and
against the same, in the Office of the City Clerk.
PASSED, APPROVED AND ADOPTE this 1 nddfty of March, 2010.
DR. LONE SO, MAYOR
ATT T:
MARI M CITY RK
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss.
CITY OF SAN JUAN CAPISTRANO )
I, MARIA MORRIS, appointed City Clerk of the City of San Juan Capistrano, do hereby certify
that the foregoing is a true and correct copy of Ordinance No. 968 which was regularly
introduced and placed upon its first reading at the Regular Meeting of the City Council on the
2nd day of arch 2010 and that thereafter, said Ordinance was duly adopted and passed at the
Regular eet' of the City Council on the 16th day of March 2010 by the following vote, to wit:
AYES: I COUNCIL MEMBERS: Allevato, Hribar, Nielsen, Freese, and Mayor Uso
NOES- NCIL MEMBERS: None
ABSEN ( NCIL MEMBERS: None
MARIA RIS, Cl CLERK
1
2 0 968
STATE OF CALIFORNIA )
COUNTY OF ORANGE ) ss AFFIDAVIT OF POSTING
CITY OF SAN JUAN CAPISTRANO )
I, MARIA MORRIS, declare as follows: That I am the duly appointed and qualified City Clerk of
the City of San Juan Capistrano; That in compliance with State laws, Government Code section
36933(1) of the State of California, on the 4`h day of March 2010, at least 5 days prior to March
16, 2010, the date of adoption of the ordinance, I caused to be posted, in the City Clerk's Office
a certified copy of the proposed Ordinance entitled:
AN ORDINANCE OF THE CIT F SAN JUAN CAPISTRANO
APPROVING AND ADOPTING A D V OPMENT AGREEMENT FOR
THE SAINT MARGARETS EPI C SCHOOL ASTER PLAN
PROJECT (ST. MARGARET OF SCO A EPISC AL SCHOOL)
M RI IS, C CLERK
S J Capistran alifornia
STATE OF CALIFORNIA )
COUNTY OF ORANGE } ss AFFIDAVIT OF POSTING
CITY OF SAN JUAN CAPISTRANO )
I, MARIA MORRIS, declare as follows: That I am the duly appointed and qualified City Clerk of
the City of San Juan Capistrano; That in compliance with State laws, Government Code section
36933(1) of the State of California. On the 23rd day of March 2010, 1 caused to be posted, in the
City Clerk's office, a certified copy of Ordinance No. 968, adopted by the City Council on March
16, 2010 entitled:
AN ORDINANCE OF THE CIT SAN JUAN CAPISTRANO
APPROVING AND ADOPTING A D E OPMENT AGREEMENT FOR
THE SAINT MARGARETS EPIC A SCHOOL MASTER PLAN
PROJECT (ST. MARGARET OF SCOL D EPISCOPAL SCHOOL)
MARI IS, CI CLERK
San Capistrano, ifornia
EXHIBIT A
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City Clerk
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
(Space Above This Line for Recofdets Office Use Only)
(Exempt from Rewriting Fee per Gov.Code§§6103 and 27383)
DEVELOPMENT AGREEMENT
(ST. MARGARET'S EPISCOPAL SCHOOL EXPANSION PROJECT)
by and between
CITY OF SAN JUAN CAPISTRANO
and
ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL
909188.5
DEVELOPMENT AGREEMENT
(ST. MARGARET'S EPISCOPAL SCHOOL EXPANSION PROJECT)
This DEVELOPMENT AGREEMENT (ST. MARGARET'S EPISCOPAL SCHOOL
EXPANSION PROJECT) (the "Agreement") is dated for reference purposes only as of the _
day of 2009, and is being entered into by and between the CITY OF SAN
JUAN CAPISTRANO, a municipal corporation, organized and existing under the laws of the
State of California("CITY"), and ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL, a
California non-profit public benefit corporation ("SMES"), pursuant to the authority of Sections
65864 through 65869.5 of the California Government Code (the "Development Agreement
Legislation") and Article XI, Section 2, of the California Constitution. CITY and SMES are
sometimes hereinafter referred to as the "Parties."
RECITALS
This Agreement is predicated upon the following facts:
A. These Recitals refer to and utilize certain capitalized terms which are defined in
this Agreement. The Parties intend to refer to those definitions in conjunction with the use
thereof in these Recitals.
B. The Development Agreement Legislation authorizes CITY to enter into binding
development agreements with persons having legal or equitable interests in real property for the
development of such property in order to, among other things: ensure high quality development
in accordance with comprehensive plans; provide certainty in the approval of development
projects so as to avoid the waste of resources and the escalation in the cost of housing and other
development to the consumer; provide assurance to the applicants for development projects that
they may proceed with their projects in accordance with existing policies, rules, and regulations,
subject to the applicable conditions of approval, in order to strengthen the public planning
process and encourage private participation in comprehensive planning and reduce the private
and public economic costs of development; and encourage and provide for the development of
public infrastructure and amenities to support the development of new housing and commercial
projects.
C. SMES and its single member, the Protestant Episcopal Church in the Diocese of
Los Angeles ("Diocese"), are the fee owners of that certain real property consisting of 26.89
acres of land located in and adjacent to a block defined by Ortega Highway, La Novia Avenue,
Calle Arroyo and Rancho Viejo Road in the in the City of San Juan Capistrano, County of
Orange, State of California, that is more particularly described and depicted in Exhibit "A"
attached hereto and made a part hereof(the "Property").
D. Of the total Property's 26.89 acres, 18.82 acres comprise the development
commonly known as "St. Margaret's Episcopal School" depicted and described as the "Campus
Parcels" in Exhibit "A", and the remaining approximately S.07 acres constitute the "Expansion
Parcels" depicted and described in Exhibit "A". The Diocese is the fee owner of the Campus
Parcels and SMES has the exclusive right to use the Campus Parcels pursuant to a Memorandum
of Agreement between SMES and the Diocese and is the owner of all of the buildings thereon.
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SMES is the fee owner of the Expansion Parcels. SMES owns the three Rancho Viejo Road lots
of the Expansion Parcels as the sole member of Ortega III LLC.
E. SMES applied for, and CITY approved Development of the Campus Parcels and
Expansion Parcels pursuant to General Plan Amendment 06-03, Rezone 07-05, Architectural
Control 07-22, Saint Margaret's Episcopal School Master Plan, in accordance with the
provisions of this Agreement, the Saint Margaret's Episcopal School Master Plan ("Master
Plan"), and other applicable regulations of the City of San Juan Capistrano and other
governmental agencies having jurisdiction over the Property and the "Project" as defined in
Section 1.22 below.
F. SMES has applied for, and CITY has approved, this Agreement in order to create
a beneficial development project and a physical environment that will conform to and
complement the goals of CITY, be sensitive to human needs and values, and facilitate efficient
traffic circulation. By its approval and execution of this Agreement CITY has determined that
CITY (including, without limitation the existing and future residents of CITY) will receive the
following direct and indirect benefits from the implementation of this Agreement:
1. The Project will conform to CITY's goal to manage growth through the
use of, among other things, comprehensive planning and design, project-wide continuity
of landscaping and architectural design, state-of-the-art development standards, and
planning concepts.
2. The traffic and circulation elements of the Development Plan will conform
to CITY's General Plan by reducing the impact of the average daily trips generated by the
Development of the Project on arterial roads and thoroughfares adjacent to the Expansion
Parcels consistent with Transportation and Traffic Mitigation Measures set forth in the
Mitigation Monitoring and Reporting Program for the Project.
3. As a religious organization, SMES is exempt from paying property taxes
on land dedicated to educational and religious uses. SMES does pay property taxes today
on the Expansion Parcels, which in the future, upon conversion to school uses, would be
subject to the property tax exemption. Also, the CITY would potentially lose sales tax
revenue as a result of the Project's removal of commercial buildings from the Expansion
Parcels and development of the Expansion Parcels for non-commercial uses.
Notwithstanding the SMES exemption from property taxes by virtue of its status as a
religious organization, in exchange for CITY's agreement to enter into and perform its
obligations set forth in this Agreement, SMES has agreed that SMES shall make an
annual payment to CITY as set forth in Section 4.1.3 below to, among other things,
compensate CITY for the loss of property taxes from removing the Expansion Parcels
from the tax rolls and loss of potential sales tax revenues, thereby providing substantial
benefits to CITY and its residents.
4. The Project will result in the expansion of the existing St. Margaret's
Episcopal School which will be of benefit to CITY and its residents by providing
additional educational resources to the community. Approximately 250 students (20% of
the students currently enrolled at St. Margaret's Episcopal School) are residents of San
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Juan Capistrano, and 700 students (57% of currently enrolled students) would otherwise
attend the Capistrano Valley Unified School District. In exchange for CITY's agreement
to enter into and perform its obligations set forth in this Agreement, SMES has agreed to
provide for increased financial aid to expand enrollment of students who are residents of
San Juan Capistrano, as set forth in Sections 4.1.4 below.
5. The Project will result in dedication of an easement to CITY for a multi-
use trail connector along La Novia Avenue along the frontage of SMES upon CITY's
approval of a final trail alignment as part of CITY's General Plan.
6. The Project will result in a shared parking agreement with CITY providing
an additional parking lot to serve CITY's Cook Park and Trails that will provide
substantial benefits to CITY and its residents.
7. SMES will allow the Ortega Equestrian Center ("OEC") to continue
operating on the Project site until May 31, 2012 or any later date agreed upon in writing
by both SMES and OEC, and will work with OEC to accommodate relocation of the
facilities in an orderly manner by May 31, 2012, or any later date agreed upon in writing
by both SMES and OEC.
G. The following actions have been taken with respect to this Agreement and the
Project:
1. On or about 2009, pursuant to the applicable provisions of
the California Environmental Quality Act, Public Resources Code Section 21000 et seq.,
and the regulations promulgated by the Secretary of Resources pursuant thereto (Title 14
of the California Code of Regulations, Section 15000 et seq.) (collectively, "CEQA"), the
City Council of CITY found and determined that all of the significant environmental
impacts of the Project, including this Agreement, were adequately mitigated in Mitigated
Negative Declaration No. ;
2. On or about 2009, the City Council of CITY approved the
Project;
3. On or about 2009, following a duly noticed and conducted
public hearing, the Planning Commission of CITY recommended to the City Council that
it approve this Agreement;
4. On or about 2009, after a duly noticed and conducted public
hearing, the City Council of CITY determined that the provisions of this Agreement are
consistent with the General Plan of CITY; and
5. On or about , 2009, after a duly noticed and conducted public
hearing, the City Council of CITY introduced Ordinance No. _ approving and
authorizing the execution of this Agreement and on 2009, the City Council
of CITY adopted said Ordinance (hereinafter the "Authorizing Ordinance"), a copy of
which Authorizing Ordinance is on file in the City Clerk's office at City Hall.
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H. In consideration of the substantial public improvements and benefits to be
provided by SMES and the Project, and in order to strengthen the public planning process and
provide significant educational and economic benefits to the City of San Juan community, by
this Agreement CITY intends to provide to SMES the assurance that it can proceed with
Development of the Project for the Term of this Agreement pursuant to the terms and conditions
of this Agreement and in accordance with the CITY's General Plan, ordinances, policies, rules,
and regulations existing as of the Effective Date. In reliance on CITY's covenants in this
Agreement concerning Development of the Property, SMES has and will in the future incur
substantial costs in site preparation and the construction and installation of major infrastructure
and facilities in order to make the Master Plan feasible.
I. Pursuant to Section 65867.5 of the Development Agreement Legislation, the City
Council has found and determined that: (i) this Agreement and the Development Plan for the
Project implement the goals and policies of CITY's General Plan, provide balanced and
diversified land uses and impose appropriate standards and requirements with respect to land
development and usage in order to maintain the overall quality of life and the environment
within the City of San Juan Capistrano, (ii) this Agreement is in the best interests of and not
detrimental to the public health, safety, and general welfare of CITY and its residents; (iii)
adopting this Agreement is consistent with CITY's General Plan and constitutes a present
exercise of CITY's police power; and (iv) this Agreement is being entered into pursuant to and in
compliance with the requirements of Section 65867 of the Development Agreement Legislation.
J. CITY and SMES agree that it may be beneficial to enter into additional
agreements and operating memoranda, or to modify this Agreement with respect to the
implementation of the separate components of the Development Plan when more information
concerning the details of each component is available, and that this Agreement should expressly
allow for such contemplated additional agreements, operating memoranda, and modifications to
this Agreement.
AGREEMENT
NOW, THEREFORE, pursuant to the authority contained in the Development Agreement
Legislation, as it applies to CITY, pursuant to Article XI, Section 2 of the California
Constitution, and in consideration of the foregoing recitals of fact, all of which are expressly
incorporated into this Agreement, the mutual covenants set forth in this Agreement, and for the
further consideration described in this Agreement, the Parties agree as follows:
1. Definitions.
The following words and phrases are used as defined terms throughout this Agreement
and each defined term shall have the meaning set forth below:
1.1 Authorizing Ordinance. "Authorizing Ordinance" means Ordinance No.
approving this Agreement.
1.2 Campus Parcels. "Campus Parcels" has the meaning ascribed in Recital D of this
Agreement.
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1.3 CE A. "CEQA" has the meaning ascribed to that term in Recital F.1 of this
Agreement.
1.4 CITY. "CITY" means the City of San Juan Capistrano, a California municipal
corporation, duly organized and existing under the Constitution and laws of the State of
California, and all of its officials, employees, agencies, and departments.
1.5 City Council. "City Council" means the duly elected and constituted city council
of CITY.
1.6 Default. "Default" has the meaning ascribed in Section 9.1 or 9.2 of this
Agreement, as applicable.
1.7 Develolor Development or Developing. "Develop" or "Development" or
"Developing" means the improvement and use of the Property for purposes consistent with the
Project and this Agreement, including, without limitation: subdividing, grading, the construction
of infrastructure and public facilities related to the St. Margaret's Episcopal School Master Plan,
the construction of structures and buildings, and the installation of landscaping, all in accordance
with the provisions of this Agreement, but does not include the maintenance, repair,
reconstruction, or redevelopment of any building, structure, improvement, or facility after the
initial construction and completion thereof.
1.8 Developer. Developer means St. Margaret's of Scotland Episcopal School, all
successors in interest, in whole or part, to the right, title, and interest of any of such entity in and
to this Agreement with respect to all or any portion of the Property.
1.9 Development Agreement Legislation. "Development Agreement Legislation"
means Sections 65864 through 65869.5 of the California Government Code as it exists on the
Effective Date.
1.10 Development Exactions. "Development Exactions" means any requirement of
CITY for the dedication of land (including without limitation through the encumbrance of land
with an easement or use restriction in favor of a public agency, the public, or a private non-profit
entity), the construction or improvement of public improvements or facilities (including without
limitation improvements or facilities located on land that is encumbered with an easement or use
restriction in favor of a public agency, the public, or a private non-profit entity), or the formation
of any Financing District and/or payment of any special taxes, assessments, or fees, in order to
provide any such public improvements or facilities in conjunction with Development or to
lessen, offset, mitigate, or compensate for the impacts of development on the environment or
other public interests consistent with the Project and this Agreement.
1.11 Development Plan. "Development Plan" means the plan for Developing the
Project on the Property in accordance with this Agreement, the Development Plan Approval(s),
and the Future Approvals. As of the Effective Date, the Development Plan consists of the
Master Plan, provisions of CITY's General Plan (as amended through the General Plan
Amendment referred to in Recital E) applicable to the Property, the narrative description of the
Project set forth in Exhibit `B"to this Agreement, the Development Plan Approvals set forth in
Exhibit "C"to this Agreement, and the express provisions set forth in this Agreement that define
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or describe the Project. The Future Development Approvals automatically shall become a part of
the Development Plan and included within the scope of SMES's vested rights provided for in this
Agreement without the need for any amendment of this Agreement when the same are issued or
approved by CITY and become effective. Each of the documents memorializing the
Development Plan is (or will be) maintained in the official records of CITY and shall be utilized
whenever required to interpret or apply this Agreement.
1.12 Development Plan Approval(s). "Development Plan Approval(s)" means the
approvals of the City Council described in Exhibit "C" hereto insofar as the same relate to the
Property and the Development Plan, including those amendments to this Agreement made in
accordance with Section 3.5 hereof, those amendments to the Development Plan Approval(s)
made in accordance with Section 3.6 hereof, and those Future Development Approvals made in
accordance with Section 3.7 hereof.
1.13 Development Transferee. "Development Transferee" means a person or entity
that expressly assumes obligations under this Agreement pursuant to Section 2.5 hereof.
1.14 Effective Date. "Effective Date" means the date the Authorizing Ordinance
becomes effective.
1.15 Expansion Parcels. "Expansion Parcels" has the meaning ascribed in Recital D of
this Agreement.
1.16 Future Development Approvals. "Future Development Approvals" means those
entitlements and approvals that are: (a) made in accordance. with Section 3.7 hereof, and
(b)requested by SMES in order to authorize the Development to occur upon the Property in a
manner consistent with the Development Plan Approval(s). By way of enumeration, and not
limitation of the foregoing, the Future Development Approvals include such development
permits, development plan reviews, use permits, variances, grading permits, building permits,
and occupancy permits that are required as a condition to SMES's right to Develop pursuant to
the Development Approvals for all or any portion of the Project.
1.17 On-Site Improvements. "On-Site Improvements" means physical infrastructure
improvements or facilities that are or will be located on the Property consistent with the
Development Plan Approvals.
1.18 [RESERVED]
1.19 Party or.Parties. "Party" means either CITY or SMES, as the context dictates, and
"Parties" means CITY and SMES.
1.20 Property. "Property" means the Property referred to in Recital C and more
particularly described in Exhibit "A"to this Agreement.
1.21 Planning Commission. "Planning Commission" means the duly appointed and
constituted planning commission of CITY.
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1.22 Project. "Project" means the Development and approvals summarized in
Recital E, the planning elements of which are more specifically described in Exhibit "B"hereto.
1.23 Pro e . 'Property" means the Property referred to in Recital C and more
particularly described in Exhibit "A"to this Agreement.
1.24 St. Margaret's Episcopal School Master Plan. "St. Margaret's Episcopal School
Master Plan" means the Master Plan approved by CITY Council Resolution No.
1.25 Tern. "Term" means the period of time that this Agreement remains in effect
with respect to the Property or any portion thereof, as provided in Section 2.3.
2. General Provisions.
2.1 Binding Covenants. The provisions of this Agreement to the extent permitted by
law shall constitute covenants which shall run with the Property for the benefit thereof, and the
benefits and burdens of this Agreement shall bind and inure to the benefit of the Parties and all
successors in interest to the Parties hereto.
2.2 Interest of SMES. As of the date this Agreement is being executed by the Parties,
SMES represents that SMES and its single member, the Protestant Episcopal Church in the
Diocese of Los Angeles ("Diocese"), are the fee owners of that certain real property consisting
of 26.89 acres of land located in and adjacent to a block defined by Ortega Highway, La Novia
Avenue, Calle Arroyo and Rancho Viejo Road in the in the City of San Juan Capistrano,
County of Orange, State of California, that is more particularly described and depicted in
Exhibit "A" attached hereto and made a part hereof (the "Property"). Of the total Property's
26.89 acres, 18.82 acres comprise the development commonly known as "St. Margaret's
Episcopal School" depicted and described as the "Campus Parcels" in Exhibit "A", and the
remaining approximately 8.07 acres constitute the "Expansion Parcels" depicted and described
in Exhibit "A". The Diocese is the fee owner of the Campus Parcels and SMES has the
exclusive right to use the Campus Parcels pursuant to a Memorandum of Agreement between
SMES and the Diocese and is the owner of all of the buildings thereon. SMES is the fee owner
of the Expansion Parcels. SMES owns the three Rancho Viejo Road lots of the Expansion
Parcels as the sole member of Ortega III LLC.
2.3 Term. Subject to the provisions of Section 10.4 of this Agreement, the initial
term (hereinafter called "Term") of this Agreement shall commence on the Effective Date and
shall terminate at the end of the day immediately preceding the twentieth (20th) anniversary of
the Effective Date, subject to the termination provisions set forth herein; provided, however,
that so long as SMES is not in Default of this Agreement and the Agreement has not been
otherwise terminated, SMES may, without the prior written consent of CITY, extend the Term
for one (1) additional period of two (2) years; and provided further that with respect to such 2-
year extension option, SMES shall give CITY written notice of its intent to extend the Term not
more than one hundred eighty (I80) days and not less than sixty(60)days before the end of the
initial Term. Pursuant to California Government code sections 65863.9 and 66452.6(a), the
expiration date of all Development Plan Approval(s) shall be extended through the Term of this
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Agreement, and any extension pursuant to this Section 2.3. Notwithstanding any other
provision of this Agreement,the provisions of Sections 4.1.3 and 4.1.4 shall survive termination
of this Agreement and shall remain in effect coterminous with Conditional Use Permit 02-14.
2.4 Termination. This Agreement shall be deemed terminated and of no further effect
upon the occurrence of any of the following events:
(i) If termination occurs pursuant to any specific provision of this Agreement;
or
(ii) As to provisions of this Agreement governing On-Site Improvements on
any separate legal lot(s) or parcel(s) within the Property, upon the completion of On-Site
Improvements on and with respect to said lot(s) or parcel(s) pursuant to the terms of this
Agreement and CITY's issuance of all required occupancy permits or final inspections, as
applicable, and acceptance of all dedications and improvements required to complete
such On-Site Improvements; or
(iii) Entry after all appeals have been exhausted of a final judgment or issuance
of a final order directed to CITY invalidating this Agreement.
The termination of this Agreement in its entirety or with respect to a particular lot(s) or
parcel(s) shall not affect any right or duty of SMES arising from any provisions of this
Agreement that remain effective or from a source other than this Agreement.
In the event this Agreement terminates in its entirety or with respect to a particular lot(s)
or parcel(s), and notwithstanding any other provision set forth herein, upon request by SMES, or
any other successor or assignee of either of them, CITY shall cooperate, at no cost to CITY, in
executing in recordable form a document prepared by the requesting party that confirms the
termination of this Agreement with respect to the Property or applicable portion thereof.
2.5 Transfers and Assignments.
2.5.1 SMES and/or the Protestant Episcopal Church in the Diocese of Los
Angeles ("Owners") shall not assign all or any part of this Agreement without the prior written
approval of the City. Such written approval by the City shall not be unreasonably withheld,
provided that: (a) if Owners' proposed assignee is an entity, such entity shall be legally formed
and qualified to conduct business in the State of California; (b) Owners shall have delivered
evidence to City that Owners' proposed assignee has the ability to comply with the Agreement;
(c) Owners and its/their assignee execute an assignment and assumption agreement pursuant to
which the assignee expressly assumes all of Owners' obligations under the Agreement; and (d)
City shall bear no expenses in connection with such assignment. Notwithstanding any other
provision of this Agreement, Owners need not obtain the prior written approval of City for the
assignment of this Agreement to a limited liability company, limited partnership or corporation
wholly-owned by, or under common control with, Owners.
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3. Development Provisions.
3.1 Vesting.
3.1.1 Pr iect. CITY covenants SMES has and shall have the right to Develop
the Project on the Property consistent with the Development Plan and the Development Plan
Approval(s), including, without limitation, the Future Development Approvals after the same
have been issued or approved by CITY and become effective ("vested right").
3.1.2 Limits on Development. The California Supreme Court held in Pardee
Construction Company v. City of Camarillo, 37 Cal.3d 465 (1984), that the failure of the parties
to address certain limits on a city's ability to condition, restrict, or regulate a development
allowed a later adopted initiative to restrict the development. This Agreement is intended to cure
that deficiency by expressly addressing the timing for the Development, the vested rights
afforded by this Agreement, and the scope of CITY's reserved authority described in Section 3.2
hereof. Except as expressly set forth in the Development Plan and Development Plan
Approval(s), regardless of any future enactment, whether by initiative or otherwise, SMES shall
have the vested right to Develop the various components of the Project in such order, at such
rate, in one phase or in multiple phases, and at such times as SMES deems appropriate within the
exercise of its subjective business judgment. Specifically, CITY agrees that SMES shall be
entitled to apply for and receive the Future Development Approvals and to Develop and use the
Property at any time, provided that such application is made and such Development occurs in
accordance with this Agreement. and the other Development Plan Approval(s). No future
amendment of any CITY law and no future adoption of any CITY law or other action that
purports to limit the scope, rate, or timing of Development on the Property or to alter the
sequencing of the Development in a manner inconsistent with the Development Plan or the
Development Plan Approval(s) (including without limitation the Future Development Approvals
when issued by CITY), whether the same are adopted or imposed by the City Council or through
the initiative or referendum process, shall apply to the Property. Notwithstanding the foregoing,
nothing in this Section 3.1 shall limit or restrict CITY's reserved authority as described in
Section 3.2.
3.1.3 Entitlements, Permits, and Approvals—Cooperation.
3.1.3.1 Processing. CITY agrees that it shall accept and expeditiously
process, pursuant to CITY's regular procedures, complete applications for the Future
Development Approvals and, if applicable, SMES's complete applications for
amendments to this Agreement, to the Development Plan Approval(s), and to any of the
Future Development Approvals (after the same have been initially approved).
3.1.3.2 Other Permits. CITY further agrees to reasonably cooperate
with SMES, at no cost to CITY, in securing any County, State, and Federal permits or
authorizations which may be required in connection with Development of the Property
that are consistent with the Development Plan and Development Plan Approval(s);
provided, that nothing in this Section 3.1.3.2 shall be deemed to require CITY's
assumption of any obligations under any said permits or authorizations.
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3.1.3.3 Acquisition of Off-Site Property. CITY shall not postpone or
refuse approval of any Future Development Approval because SMES or a Development
Transferee has failed to acquire off-site property required for the construction or
installation of offsite improvements. To the extent CITY, SMES, or a Development
Transferee does not have sufficient title or interest to permit any of such offsite
improvements that are such entity's responsibility to be constructed or installed at the
time the application for a Future Development Approval is processed or approved by
CITY, SMES or the Development Transferee shall make a good faith effort to acquire the
required property. If SMES or the Development Transferee is unable to acquire the
required property, CITY shall consider in good faith the acquisition of the required
property. If CITY is unable to acquire the required property by negotiation or
condemnation within the time frame provided for in Government Code Section 66462.5,
CITY shall continue to issue the Future Development Approval(s) for the Property
despite the fact that the offsite improvement has not been completed. Notwithstanding
the foregoing, CITY's obligation to continue to issue the Future Development Approvals
as provided for in this Section is contingent upon: (i) SMES or the Development
Transferee submitting the improvement plans required for the improvement to CITY; and
(ii) consistent with Government Code Section 66462.5, SMES or the Development
Transferee entering into a mutually acceptable agreement with CITY that requires SMES
or the Development Transferee to pay or reimburse or secure the future payment or
reimbursement of CITY for SMES's fair share of the costs incurred in acquiring the land
and constructing the applicable offsite improvement(s) at such time as CITY acquires the
required land.
3.2 Reserved Authority.
3.2.1 Reservation of Authority With Respect to Future Development
Approvals; Future Changes in Development Exactions. Notwithstanding any other provision set
forth in this Agreement to the contrary, CITY reserves the right after the Effective Date of this
Agreement to change its development standards applicable to the Property and the Project and to
exercise the same degree of discretion and control in its consideration of Future Development
Approvals that it would have in the absence of this Agreement to impose conditions under
CEQA and other applicable laws and regulations that apply to all similar development
throughout the CITY in order to mitigate the Project's impact on the environment, subject to the
following limitations:
(i) No such future changes in CITY's development standards or
mitigation measures shall be inconsistent with the Development Plan, the Project
Development Approvals, or any of the provisions set forth in Sections 3.1 or 4.1-
4.2 of this Agreement, nor shall any such future changes materially jeopardize or
impair the rights of SMES thereunder;
(ii) No change in CITY's development standards or mitigation
measures adopted or imposed after the Effective Date with respect to the affected
portion of the Property shall apply except to the extent the same shall be
applicable to similarly situated properties or projects on a citywide or areawide
basis; and
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(iii) CITY shall not require the Project or the Property to participate in
regional programs (i.e., programs that are not initiated by CITY and that include
properties located in whole or in part outside the City of San Juan Capistrano) nor
shall CITY require the Project or the Property to pay or contribute to regional
Development Exactions to the extent that such programs or Development
Exactions are not in effect as of the Effective Date with respect to the affected
portion of the Property, including without limitation any such programs or
Development Exactions initiated by the County of Orange.
3.2.2 Uniform Codes. This Agreement shall not prevent CITY from applying
to the Project new uniform construction standards adopted by the State of California as State
Codes, such as the Uniform Building Code, National Electrical Code, Uniform Mechanical
Code, and Uniform Fire Code, provided those same standards are applied to all other
development within the City of San Juan Capistrano.
3.2.3 State and Federal Laws and Regulations. SMES shall comply with all
applicable state and federal laws and regulations, provided that nothing in this Agreement shall
be deemed to limit or restrict the right of SMES to contest or challenge the validity of any such
laws or regulations or their applicability to the Property or the Project. In the event that either
CITY or SMES determines that a state or federal law or regulation prevents the full
implementation of the Development Plan and/or any of the Development Plan Approval(s), that
Party shall provide the other Party with written notice of the state or federal law or regulation, a
copy of the law or regulation, and a written statement of the conflicts between such state or
federal law or regulation and this Agreement. Promptly thereafter CITY and SMES shall meet
and confer in good faith in a reasonable attempt to determine whether a modification or
suspension of this Agreement is required, provided that each Party reserves its discretion with
respect thereto. CITY agrees to cooperate with SMES in resolving the conflict in a manner
which minimizes any adverse fiscal or other impact of the conflict upon SMES, provided only
that in no event does CITY agree that in such event it will materially increase its financial
obligations set forth in this Agreement or otherwise materially increase its obligations. CITY
also agrees to process in a prompt manner SMES's proposed changes to the Development Plan
and/or Development Plan Approval(s) as may be necessary to comply with such federal or state
law or regulation; provided, however, that the approval of such changes by CITY shall be subject
to the discretion of CITY, consistent with this Agreement.
3.2.4 Suspension of Development in Order to Protect Health and Safety.
Nothing in this Agreement shall be construed to be in derogation of CITY's police power to
suspend the right of SMES to develop all or any portion of the Project in order to protect the
public health and safety (e.g., in the event of the unavailability of adequate water, wastewater
treatment, or storm drainage facilities). In the event that CITY determines that the public health
or safety require a suspension of SMES's right to develop all or any portion of the Project, the
scope of the suspension shall be limited to the extent determined by CITY to be reasonably
necessary to protect the public health or safety, the term of the suspension shall be limited to the
period of time during which the public health or safety concern continues, and CITY shall
exercise reasonable good faith efforts to minimize the period of such suspension to the extent
that the cause thereof is within CITY's control. As soon as is reasonably practicable after the
commencement of an event that results in a suspension of the rights of SMES to develop
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hereunder due to public health or safety concerns, CITY shall provide SMES with written notice
of the existence of such event, a detailed explanation of CITY's proposed action, and a written
statement of any conflicts with the provisions of this Agreement that require a suspension of any
of the terms hereof. Promptly thereafter CITY and SMES shall meet and confer in good faith in
a reasonable attempt to determine whether a modification or suspension of this Agreement in
whole or in part, is necessary. In such negotiations, CITY and SMES agree to preserve the terms
of this Agreement and the rights of SMES as derived from this Agreement to the maximum
feasible extent while resolving the conflict. CITY agrees to cooperate with SMES in a good faith
reasonable effort to resolve any such conflict in a manner which minimizes any adverse financial
or other impact of the conflict upon SMES without materially increasing the obligations of CITY
under this Agreement. CITY also agrees in such event to process in an expedited manner
SMES's proposed changes to the Development Plan and any previously issued Development
Plan Approval(s) as may be necessary to appropriately respond to the public health and safety
concern with respect to the portion of the Property owned by SMES; provided, however, that the
approval of any such changes by CITY shall be subject to the discretion of CITY, consistent with
this Agreement, and no such change shall apply to any other portion of the Property without the
prior written consent of the owner(s)thereof.
3.3 Further Assurances to SMES Regarding Exercise of Reserved Authority. The
Parties further acknowledge that the public benefits to be provided by SMES to CITY pursuant
to this Agreement are in consideration for and reliance upon assurances that the Property may
be developed and used in accordance with the Development Plan and the Development Plan
Approval(s). Accordingly, while recognizing that the Development of the Property may be
affected by the exercise of the authority and rights reserved and excepted as provided in
Sections 3.1 ("Vesting") and 3.2 ("Reserved Authority"), SMES is concerned that normally the
judiciary extends to local agencies significant deference in the adoption of rules, regulations,
and policies and that in the absence of an express provision set forth in this Agreement such
judicial deference might be construed to permit CITY, in violation of the limitations on its
reserved authority, to attempt to apply rules, regulations, and policies that are inconsistent with
the Development Plan and the Development Plan Approval(s). Accordingly, SMES desires
assurances that CITY shall not, and CITY agrees that it shall not, further restrict or limit the
Development of the Property in violation of this Agreement except in strict accordance with the
reserved authority described in Section 3.2 hereof, which exercising of CITY's reserved
authority shall not be considered to be a violation of this Agreement. In this regard, from and
after the date that CITY approves the St. Margaret Episcopal School Master Plan for the
Project, if SMES judicially (including by way of a reference proceeding) challenges CITY's
purported exercise of its reserved authority as being in violation of this Agreement, SMES shall
bear the burden of alleging that such purported exercise by CITY of its Reserved Authority is
inconsistent with the Development Plan or the Development Plan Approval(s) and CITY
thereafter shall bear the burden of proof in establishing by a preponderance of the evidence that
such exercise of its Reserved Authority is in accordance with and not a violation of this
Agreement.
3.4 Vested Right. By entering into this Agreement and relying thereupon, SMES is
obtaining certain vested rights to proceed with the Development anticipated by the
Development Plan and the Development Approvals and in accordance with the terms and
conditions of this Agreement (as the same may be amended and supplemented from time to
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time as expressly set forth herein). By entering into this Agreement and relying thereupon,
CITY is securing certain public benefits which enhance the public health, safety, and welfare.
CITY therefore agrees to the following:
3.4.1 No Conflicting Enactments. Except as provided in Section 3.2 of this
Agreement, after the Effective Date neither the City Council nor any other agency of CITY shall
enact a rule, regulation, ordinance, or other measure (collectively, "law") applicable to the
Property which is inconsistent or in conflict with this Agreement. Not by way of limitation of
the foregoing, any law, whether by specific reference to this Agreement or otherwise, shall be
considered to be inconsistent and in conflict with this Agreement if it has any of the following
effects:
(i) It limits or reduces the enrollment, density or intensity of the
Project as provided for in the Development Plan or the Development Plan
Approval(s);
(ii) It applies to the Property, but is not uniformly applied by CITY to
all substantially similar development within CITY; or
(iii) It imposes Development Exactions on the Property other than
those in effect on the Effective Date or as otherwise expressly permitted by
Section 3.2.1 of this Agreement.
3.4.2 Consistent Enactments. By way of enumeration and not limitation, the
following types of laws shall be considered consistent and not in conflict with this Agreement:
(i) Laws that provide for the relocation of structures within the
Property pursuant to an application from SMES;
(ii) Laws that provide for changes in the phasing of the Development
pursuant to an application from SMES; and
(iii) Any law that is expressly authorized by this Agreement.
3.4.3 Initiative Measures. In addition to and not in limitation of the foregoing,
it is the intent of SMES and CITY that no moratorium or other limitation (whether relating to the
Development of all or any part of the Property and whether enacted by initiative or otherwise)
affecting site development permits, precise plans, site development plans, building permits,
occupancy certificates, or other entitlements to use approved, issued, or granted within CITY, or
portions of CITY, shall apply to the Property to the extent such moratorium or other limitation
would restrict SMES's right to Develop the various elements of the Project on the Property in
such order and at such rate as SMES deems appropriate.
3.5 Amendment of Development Agreement.
3.5.1 Initiation of Amendment. Any Party may propose an amendment to this
Agreement, and all Parties agree that it may be beneficial to enter into additional written
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agreements or modifications of this Agreement in connection with the Development of the
separate components of the Development Plan.
Notwithstanding any provision of this Agreement to the contrary, no amendment
to the Development Plan or to any conditions of approval contained therein shall require an
amendment of this Agreement.
3.5.2 Procedure. Except as set forth in Section 3.5.4 below, the procedure for
proposing and adopting an amendment to this Agreement shall be the same as the procedure
required for entering into this Agreement in the first instance.
3.5.3 Consent. Except as expressly provided in this Agreement, any
amendment to this Agreement shall require the written consent of all affected Parties. An
amendment to this Agreement shall not be deemed to affect a portion of the Property if it does
not alter, jeopardize, or impair the rights and does not increase the obligations of SMES that
owns said portion of the Property. No amendment to all or any provision of this Agreement shall
be effective unless set forth in writing and signed by duly authorized representatives of each of
the affected Parties.
3:54 jRESERVEDI
Agreement 4e the ee»4rer3. CITY agrees s c ne...e.
3.5.4.1 in the event c1 ES i its sole and absolute diseret:e., obtains e
legal or equitable interest in .," of the Opti v eel cMES hall hm,e 4h, right but n04
the-ebligatiert to annetE any of all of theOpfien Parsels irate-this Agreement. Sacs"
may eeetif on a par-eel
by p ..eel basis et e time o multiple times Any
affl-ne*mien shall be effeetWe
upon the entityy ve,...: iag any e..eh Opti.. nereel
6-Ang GITY
vffitten netiee-of saeh annexation and, if applieable exeewingan
�eadme.,t or addendum to this Agreement : e form r nably satisC.tei.y to CTTY's
rr
a#eey agreeing to he bound,thereby with r-espeet to sueh Optien Dereel(s) /the
" 1BtEatisR Effeetiye-Date—in the-eTeat-of any suerhi--atinaexatien(8), 4^-a OptieEi
Pareel(s) shall be deemed to be ..art of the Drepei4y for all pwpeses and s .sh Optie
Dewae1Ls) shell he ubjeet trights and hl: e4io s thatafe et f i4h herein with
w � ..o the ou.aa..
.espeet to the baianee-of the-Preperty €recti and after- 4he Atmexation Ef€eefiye Batu
the e,4e.'st that the Development Agree Legislation CITY ed
_ ___-_ ___- ._.__„Y...-..- _b.�_........ ..,mob....»...... .�.y....�., �.. ... »».,Y. »
b , as Y herein, V agrees to •pvrete 4th the entity e •:ig the
to
n sins, Pa eel(..) lisp said oe . e t,. e xte..t i
r \ � »'1' bjetihiai4ixixaxxrv�r �" od 1..7`in'v ,
the Annexation Effeetive Date shall be the date said subsequefA or-dinanee beeefaes
eff-eetive, and CITY eavenants to ,.t 4el.e any aetion between h date : reeeives .r-k4e
would adversely dverse.y aff et .. impaif SMES's vested rightsher-etffiden
3.5.4.2 Net A4thste»dingan), ether pfevisien vet C h in th:Pafeelse
the Pfoperty be renditioned or dependent upon SMES's aequisitien of any of the Option
, Y y
the f the /Ogen Par-eels, or- the a se enc by afky of the
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of the Option n l to to with CITY or SMES . th e to the Project
o�arixcri-orma�peroix-r-£n'coxTco-owpcifscvs 'i mx rcg... ... .,�..
Not b way f limitation of the foregoing, to the nwr..t SIMMQ ares ....t
the appheant for land tise entitlements fef all or mly portion of the Option Pareels, SN
ball not be obligated to o rate ...:N, a .a1. aeananshall nee_ tr
n ppht d ll t bobligated
w
nrN stn ....1... el.. h -.t F Nen atr,.etio of off site .,t
• n...a m. rr..
... n« « ns. �++�f�rr��rufnu
rr
Y" .. �.. � "YY � , -c -
related to s .eh Option Darreln
3.5.5 Operating_Memoranda. The Parties acknowledge that refinements and
further development of the Development Plan may demonstrate that changes are appropriate with
respect to the details and performance of the Parties under this Agreement. The Parties desire to
retain a certain degree of flexibility with respect to the details of the Development Plan and with
respect to those items covered in general terms under this Agreement. If and when the Parties
mutually find that changes, adjustments, or clarifications are appropriate to further the intended
purposes of this Agreement, they may, unless otherwise required by law, effectuate such
changes, adjustments, or clarifications without amendment to this Agreement through operating
memoranda mutually approved by the Parties, which, after execution, shall be attached hereto as
addenda and become a part hereof and which may be further changed and amended from time to
time. To the maximum extent permitted by law, the City Manager shall have the authority, on
behalf of CITY, to approve and execute such operating memoranda and the Headmaster Officer
of SMES shall have the authority, on behalf of SMES, to approve and enter into such operating
memoranda. Unless otherwise required by law or by the Development Plan Approval(s), no such
changes, adjustments, or clarifications shall require prior notice or hearing.
3.6 Future Amendments to Development Plan. The following rules apply to future
amendments to the Development Plan:
3.6.1 SMES's Written Consent. Any Development Plan amendment to which
SMES does not agree in writing shall not apply to the Property while this Agreement is in effect.
3.6.2 Concurrent Development Agreement Amendment. Any Development
Plan amendment requiring amendment of this Agreement shall be processed concurrently with
an amendment to this Agreement.
3.6.3 Effect of Amendment. Except as,expressly set forth in the Development
Plan amendment itself or this Agreement, a Development Plan amendment shall not alter, affect,
impair, or otherwise impact the rights, duties, and obligations of the Parties set forth in this
Agreement.
3.7 Future Development Approvals.
3.7.1 Exercise of CITY Discretion. In connection with Future Development
Approvals or any other actions which CITY is expressly permitted to take consistent with this
Agreement relating to the Property,to the maximum extent permitted by law CITY shall exercise
its discretion or take action in a manner which complies and is consistent with the Development
Plan, any Development Plan Approval(s) issued by CITY consistent with this Agreement prior to
the date CITY takes final action on the Future Development Approval then in question, and the
other terms and conditions set forth herein.
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3.7.2 Concurrent Development Agreement Amendment. Any Future
Development Approval requiring amendment of this Agreement, as provided for in Section 3.5
hereof, shall be processed concurrently with an amendment to this Agreement.
3.7.3 Effect of Future Development Approvals. To the maximum extent
permitted by law and except as expressly set forth in this Section 3.7, a Future Development
Approval.shall not alter, affect, impair, or otherwise affect the rights, duties, and obligations of
any of the Parties set forth in this Agreement. To the extent a Future Development Approval is
approved in accordance with Sections 3.7.1 and 3.7.2, the Future Development Approval shall
constitute for all purposes a Development Plan Approval.
4. Miscellaneous Obligations of the Parties.
4.1 SMES's Rights and Obligations With Respect to Implementing St. Margaret's
Episcopal School Master Plan.
In carrying out the Master Plan, SMES shall comply with the following:
I. The Project shall conform to CITY's goal to manage growth through the
use of, among other things, comprehensive planning and design, project-wide continuity
of landscaping and architectural design, state-of-the-art development standards, and
planning concepts.
2. The traffic and circulation elements of the Development Plan will conform
to CITY's General Plan and will be designed to reduce the impact of the average daily
trips generated by the development of the Project on arterial roads and thoroughfares
adjacent to the Expansion Parcels by implementing the Mitigation Measures set forth in
the Mitigation Monitoring and Reporting Program for the Project.
3. As a religious organization, SMES is exempt from paying property taxes
on land dedicated to educational and religious uses. SMES does pay property taxes today
on the Expansion Parcels, which in the future, upon conversion to school uses, would be
subject to the property tax exemption. Also, the CITY would potentially lose sales tax
revenue as a result of the Project's removal of commercial buildings from the Expansion
Parcels and development of the Expansion Parcels for non-commercial uses.
Notwithstanding the SMES exemption from property taxes by virtue of its status as a
religious organization, in exchange for CITY's agreement to enter into and perform its
obligations set forth in this Agreement, SMES has agreed that SMES shall make an
annual payment to CITY in an amount calculated as set forth in this Section 4.1.3,
providing substantial benefits to CITY and its residents:
In order to fully mitigate potential impacts of the lost property tax and
sales tax revenues associated with the Development Plan and provide financial benefits to
CITY and its residents, SMES shall pay to CITY each year an amount calculated as
follows for CITY's General Fund:
(1) $25,000 by September 30, 2011
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(2) $50,000 by September 30, 2012
(3) $75,000 by September 30, 2013 and by September 30 of every
year thereafter
(4) The above payments shall be increased by 2% compounded
annually beginning October 1, 2013
This is described further in Exhibit"D".
4. The Project will result in the expansion of the existing St. Margaret's
Episcopal School which will be of benefit to CITY and its residents by providing
additional educational resources to the community. As of this date, approximately 250
students (20% of the students enrolled at St. Margaret's Episcopal School) are residents
of San Juan Capistrano, and 700 students (57% of currently enrolled students) would
otherwise attend the Capistrano Valley Unified School District. Compliance with the
student enrollment cap established by Conditional Use Permit 02-14 ("Cap") shall be
determined annually, based on SMES's enrollment count as reported to the California
Department of Education. In order to encourage enrollment of high-need San Juan
Capistrano Students, SMES shall be entitled to enroll students who will be exempt from
the Cap, as detailed below and as described further in Exhibit"D":
(1) SMES may, in its sole discretion, enroll up to thirty (30) students who are
residents of San Juan Capistrano and are receiving financial aid of 80% or more
of tuition fees ("SJC80 Students"); and
(2) For each SJC80 Student in excess of twenty (20) (i.e. for the 21" through
30th SJC80 Student enrolled), SMES may, in its sole discretion, enroll up to one
additional student ("Non-SJC80 Student") up to a maximum of ten (10) Non-
SJC80 Students.
(3) The SJC80 students (up to 30) and Non-SJC80 students (up to 10) allowed
by this Section 4.1.4 shall be exempt from the Cap established by Conditional Use
Permit 02-14 and shall not be included in SMES's annual calculation of full time
equivalent students.
The traffic and other potential impacts associated with the increased number of students
authorized by this Section 4.1.4 are mitigated to a level below significant by the
Development Plan's removal of commercial buildings and commercial uses from the
Expansion Parcels.
5. The Project will result in dedication of an easement to CITY for a multi-
use trail connector along La Novia Avenue along the frontage of SMES upon CITY's
approval of a final trail alignment as part of CITY's General Plan.
6. The Project will result in a shared parking agreement with CITY providing
an additional parking lot to serve CITY's Cook Park and Trails that will provide
substantial benefits to CITY and its residents.
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7. SMES will allow the Ortega Equestrian Center ("OEC") to continue
operating on the Project site under the terms of its existing lease with SMES until May
31, 2012, or any later date agreed upon in writing by both SMES and OEC, and will work
with OEC to accommodate relocation of the facilities in an orderly manner by May 31,
2012, or any later date agreed upon in writing by both SMES and OEC.
4.2 Future Development Approvals. To the maximum extent permitted by law CITY
agrees to expedite the processing of the Future Development Approvals, and to use its reasonable
good faith efforts to approve or adopt the Future Development Approvals in form and content
reasonably satisfactory to SMES; provided, however, that nothing in this Section 4.2 shall, or
shall be construed to, constitute a promise or commitment by CITY to approve the Future
Development Approvals or to approve the same with or without any particular requirements or
conditions, and provided further that prior to the date that the Future Development Approvals
may be so approved, CITY reserves its full legislative police power authority with respect
thereto consistent with its obligations set forth elsewhere in this Agreement. To the extent a
Future Development Approval is approved that pertains to the Property, the Future Development
Approval shall constitute for all purposes a Development Plan Approval.
5. Indemnification.
Except to the extent of the gross negligence or willful misconduct of CITY and its agents,
officers, contractors, attorneys, and employees (the "Indemnified Parties"), SMES, and with
respect to the portion of the Property transferred to them, the Development Transferee agree: to
indemnify, defend, and hold harmless the Indemnified Parties from and against each and every
claim, action, proceeding, cost, fee, legal cost, damage, award or liability of any nature arising
from alleged damages caused to third parties and alleging that CITY is liable therefor as a direct
or indirect result of CITY's. approval of or performance under this Agreement. The duties of
SMES under this Section 5 are solely subject to and conditioned upon the Indemnified Parties'
written request to SMES to defend and/or indemnify CITY. Without in any way limiting the
provisions of this Section 5, the Parties hereto agree that this Section 5 shall be interpreted in
accordance with the provisions of California Civil Code Section 2778 in effect as of the
Effective Date.
6. Relationship of Parties.
The contractual relationship between CITY and SMES is such that SMES is an
independent contractor and not an agent or employee o f CITY. CITY and SMES hereby
renounce the existence of any form of joint venture or partnership between them, and agree that
nothing contained in this Agreement or in any document executed in connection with the
Property shall be construed as making CITY and SMES joint venturers or partners.
7. Amendment or Cancellation of Agreement.
This Agreement may be amended or canceled in whole or in part only by mutual consent
of the Parties in the manner provided for in Government Code Section 65868. No amendment or
modification of this Agreement or any provision hereof shall be effective unless set forth in
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writing and signed by duly authorized representatives of each Party hereto. This provision shall
not limit any Party's remedies as provided by Section 9.
8. Periodic Review of Compliance with Agreement.
8.1 Periodic Review. CITY and SMES shall review this Agreement at least once
every 12-month period from the date this Agreement is executed, in September or such other
month as the City my notify SMES. CITY shall notify SMES in writing of the date for review
at least thirty (30) days prior thereto. Such periodic review shall be conducted in accordance
with Government Code Section 65865.1.
8.2 Good Faith Compliance. During each periodic review, SMES shall be required to
demonstrate good faith compliance with the terms of this Agreement, including, but not limited
to: its compliance with SMES's enrollment Cap, calculated in accordance with Section 4.1.4
above; and the annual payment required by Section 4.1.3 above. SMES agrees to furnish such
reasonable evidence of good faith compliance as CITY, in the exercise of its reasonable
discretion, may require. If requested by SMES, CITY agrees to provide to SMES a certificate
that SMES or its Development Transferee is in compliance with the terms of this Agreement,
provided SMES reimburses CITY for all reasonable and direct costs and fees incurred by CITY
with respect thereto.
8.3 Failure to Conduct Annual Review. The failure of CITY to conduct the annual
review shall not be a Default by SMES, nor shall any such failure alter, suspend, or terminate
any of the Parties' other rights and obligations hereunder. Further, SMES shall not be entitled
to any remedy for a failure by CITY to conduct this annual review.
8.4 Initiation of Review by Citv Council. In addition to the annual review, the City
Council may at any time initiate a review of this Agreement by giving written notice to SMES.
Within thirty (30) days following receipt of such notice, SMES shall submit evidence to the
City Council of SMES's good faith compliance with this Agreement and such review and
determination shall proceed in the same manner as is provided in Sections 8.1 and 8.2 and the
Development Agreement Legislation for the annual review. The City Council shall initiate its
review pursuant to this Section 8.4 only if it has probable cause to believe CITY's general
health, safety, or welfare is at risk as a result of specific acts or failures to act by SMES.
8.5 Administration of Agreement. Any final decision by the CITY's staff concerning
the interpretation and administration of this Agreement and Development of the Property in
accordance herewith may be appealed by SMES to the City Council, provided that any such
appeal shall be filed with the City Clerk within ten (10) days after SMES receives written notice
that the staff decision is final. The City Council shall render, at a noticed public hearing, its
decision to affirm, reverse, or modify the staff decision within thirty (30) days after the appeal
is so filed.
8.6 Availability of Documents. If requested by SMES, CITY agrees to provide to
SMES copies of any documents, reports, or other items reviewed, accumulated, or prepared by
or for CITY in connection with any periodic compliance review by CITY, provided SMES
reimburses CITY for all reasonable and direct costs and fees incurred by CITY with respect
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thereto. CITY shall respond to SMES's request on or before ten (10) business days have
elapsed from CITY's receipt of such request.
9. Events of Default: Remedies and Termination.
9.1 Defaults by SMES. If CITY determines on the basis of a preponderance of the
evidence that SMES has not complied in good faith with the terns and conditions of this
Agreement, CITY may, by written notice to SMES, specify the manner in which SMES has
failed to so comply and state the steps SMES must take to bring itself into compliance. If,
within sixty (60) days after the effective date of notice from CITY specifying the manner in
which SMES has failed to so comply, SMES does not commence all steps reasonably necessary
to bring itself into compliance as required and thereafter diligently pursue such steps to
completion, then SMES shall be deemed to be in default under the terms of this Agreement (a
"Default"). In such event, CITY may terminate this Agreement pursuant to Government Code
Section 65865.1 with respect to the Property. In material event of Default by SMES, except as
provided in Section 9.3, CITY's sole remedy for any breach of this section 9.1 shall be CITY's
right to terminate this Agreement.
9.2 Defaults by CITY. If SMES determines on the basis of a preponderance of the
evidence that CITY has not complied in good faith with the terms and conditions of this
Agreement, SMES may, by written notice to CITY, specify the manner in which CITY has
failed to so comply and state the steps CITY must take to bring itself into compliance. If,
within sixty (60) days after the effective date of notice from SMES specifying the manner in
which CITY has failed to so comply, CITY does not commence all steps reasonably necessary
to bring itself into compliance as required and thereafter diligently pursue such steps to
completion, then CITY shall be deemed to be in default under the terms of this Agreement (a
"Default"). In such event, SMES may terminate this Agreement with respect to the Property
and, in addition, may pursue any other remedy available at law or equity, including specific
performance as set forth in Section 9.3.
9.3 Specific Performance Remedy. Due to the size, nature, and scope of the
Development Plan, it will not be practical or possible to restore_the Property to its pre-
development condition once implementation of this Agreement has begun. After such
implementation, SMES may be foreclosed from other choices they may have had to utilize the
Property and provide for other benefits. SMES has invested significant time and resources and
performed extensive planning and processing of the Development Plan and Development Plan
Approval(s) in agreeing to the terms of this Agreement and will be investing even more
significant time and resources in implementing the Development Plan and Development Plan
Approval(s) in reliance upon the terms of this Agreement, and it is not possible to determine the
sum of money which would adequately compensate SMES for such efforts. For the above
reasons, CITY and SMES agree that damages would not be an adequate remedy if CITY fails to
cant' out its obligations under this Agreement and that SMES shall have the right to seek and
obtain injunctive relief and specific performance as a remedy for any Default by CITY
hereunder. CITY and SMES further acknowledge that, if SMES fails to carry out its
obligations under this Agreement, CITY shall have the right to refuse to issue any permits or
other approvals which SMES otherwise would have been entitled to pursuant to this Agreement
that are related to and depend upon SMES's performance hereunder. Therefore, CITY's remedy
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specific performance pursuant to Section 9.1, or else the remedy of terminating this Agreement
as to the portion of the Property as to which a material breach of Section 9.1 exists shall be
sufficient in most circumstances if SMES fails to carry out its obligations hereunder.
Notwithstanding the foregoing, if CITY issues a permit or other approval pursuant to this
Agreement in reliance (explicitly stated in writing) upon a specified condition being satisfied in
the future, and if SMES then fails to satisfy such condition, CITY shall be entitled to specific
performance for the sole purpose of causing SMES to satisfy such condition. CITY's right to
specific performance shall be limited to those circumstances set forth above, and CITY shall
have no right to seek specific performance to cause SMES to otherwise proceed with the
Development of the Property in any manner.
9.4 Institution of Legal Action. Except to the extent a non-Defaulting Party's rights
or remedies are limited by the express provisions set forth herein, SMES or CITY may institute
legal action to cure, correct, or remedy any Default, to enforce any covenants or agreements
herein, to enjoin any threatened or attempted violation hereof, to recover damages for any
Default, or to obtain any other remedies consistent with the purpose of this Agreement. Such
legal action shall be heard by a reference from the Orange County Superior Court.
9.5 Estoppel Certificates. Any Party or the holder or prospective holder of a
mortgage or deed of trust secured by an interest in any portion of the Property (a "holder")may
at any time during the Term of this Agreement deliver written notice to the other Party
requesting an estoppel certificate(the "Estoppel Certificate") stating:
(i) The Agreement is in full force and effect and is a binding obligation of the
Parties;
(ii) This Agreement has not been amended or modified either orally or in
writing or, if so amended, identifying the amendments;
(iii) No Default exists hereunder, nor would any Default exist with the passage
of time or the giving of notice, or both, or, if a Default or failure does exist, the nature
thereof and the actions required to be taken by the non-performing Party to cure the
Default or prevent the same from occurring; and
(iv) Any other matter affecting the status of the rights and obligations of the
Parties hereunder as to which the requesting Party or the holder may inquire.
A Party receiving a request for an Estoppel Certificate shall provide a signed certificate to
the requesting Party or holder within thirty (30) days after receipt of the request. The City
Manager or any person designated by the City Manager may sign Estoppel Certificates on behalf
of CITY. The Headmaster of SMES may sign on behalf of SMES. An Estoppel Certificate may
be relied on by the holder and by Development Transferees.
In the event that one Party requests an Estoppel Certificate from another Party of Parties,
the requesting Party shall reimburse the other Party or Parties for all reasonable and direct costs
and fees incurred by such Party or Parties with respect thereto.
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10. Waivers and Delays.
10.1 No Waiver. Failure by a Party to insist upon the strict performance of any of the
provisions of this Agreement by another Party, and failure by a Parry to exercise its rights upon
a Default by another Party hereto, shall not constitute a waiver of such Party's right to demand
strict compliance by such other Party or Parties in the future for the same, similar, or any
different Default.
10.2 Third Parties. The Parties' respective performance obligations hereunder shall not
be delayed or excused because of any act or failure to act by a third person, except as provided
in Section 10.3.
10.3 Force Majeure. Notwithstanding any other provision set forth in this Agreement
to the contrary, SMES shall not be deemed to be in Default where failure or delay in
performance of any of its obligations under this Agreement is caused by floods, earthquakes,
other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties
beyond SMES's control, SMES's inability to obtain required permits or approvals from
governmental agencies with jurisdiction over the applicable portions of the Property and the
Project, government regulations (including, without limitation, local, state, and federal
environmental and natural resource regulations), voter initiative or referenda, moratoria
(including, without limitation, any "development moratorium" as that term is applied in
Government Code Section 66452.6), litigation, or any other causes that are without the fault
and beyond the reasonable control of SMES.
10.4 Extensions. The Term of this Agreement and the times for performance by SMES
or CITY of any of its obligations hereunder or pursuant to the Development Plan Approval(s)
shall be extended by the period of time that any of the events described in Section 10.3 exist
and/or prevent performance of such obligations. In addition, the Term shall be extended for
delays arising from the following events for a time equal to the duration of each delay which
occurs during the Term:
(i) The period of time after the Effective Date during which litigation
challenging the validity or enforceability of this Agreement or related to the Development
Plan Approval(s) or having the actual effect of delaying implementation of the
Development Plan is pending, including litigation pending on the Effective Date. This
period shall include any time during which appeals may be filed or are pending; and
(ii) Any delay resulting from the acts or omissions of CITY or any other
governmental agency or public utility and beyond the reasonable control of SMES.
10.5 Notice of Delay. SMES shall give notice to CITY of any delay which SMES
believes to have occurred as a result of the occurrence of any of the events described in Section
10.3. For delays of six months or longer, this notice shall be given within a reasonable time
after SMES becomes aware that the delay has lasted six months or more. In no event, however,
shall notice of a delay of any length be given later than thirty days after the end of the delay or
thirty days before the end of the Term, whichever comes first.
_22_
11. Notices.
All notices required or provided for under this Agreement shall be in writing and
delivered in person or sent by certified mail, postage prepaid, return receipt requested.
Notices to CITY shall be addressed as follows:
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attention: City Manager
with a copy to:
Woodruff, Spradlin& Smart
555 Anton Boulevard, Suite 1200
Costa Mesa, CA 92626
Attention: Omar Sandoval, City Attorney
Notices to SMES shall be addressed as follows:
The Headmaster
Saint Margaret's of Scotland Episcopal School
31641 La Novia
San Juan Capistrano, CA 92675
with a copy to:
Gibson Dunn& Crutcher, LLP
3161 Michelson Drive
Irvine, CA 92612
Attention: Joseph P. Busch III, Esq.
Any notice given as required herein shall be deemed given only if in writing and upon
delivery personally or by independent courier service. A Party may change its address for
notices by giving notice in writing to the other Parties as required herein and thereafter notices
shall be addressed and transmitted to the new address.
CITY shall additionally provide written notice of any Default by SMES (including, as
applicable, any Development Transferee) and any act or omission by SMES (or such
Development Transferee) that would constitute a Default with the passage of time or giving of
notice or both, to the holder of any mortgage or deed of trust secured by all or any interest in the
Property which (i) delivers a written notice to CITY requesting such notices and (ii)provides
CITY with such holder's address(es) for notice purposes.
-23-
12. Attorneys' Fees.
If legal action is brought by one Parry against another Party for breach of this Agreement,
including actions derivative from the performance of this Agreement, or to compel performance
under this Agreement, the prevailing Party shall be entitled to an award of its costs, including
reasonable attorneys' fees, and shall also be entitled to recover its contribution to the costs of the
referee referred to in Section 9.4 above as an item of damage and/or recoverable costs.
13. Recording.
This Agreement and any amendment or cancellation hereto shall be recorded against the
Property at no cost to CITY, in the Official Records of Orange County by the City Clerk within
the period required by Section 65868.5 of the Government Code. In addition, at such time that
SMES acquires fee title to any of the Expansion Parcels and such parcel(s) is (are) added to this
Agreement as provided in Section 3.5.4 this Agreement, this Agreement and any amendment or
cancellation hereto shall be recorded, at no cost to CITY, with respect to any such Expansion
Parcel(s). Notwithstanding the foregoing, in no event shall any failure or delay in recording this
Agreement and any amendment to this Agreement limit or restrict the validity or enforceability
of this Agreement.
14. Effect of Agreement on Title.
14.1 Effect on Title. The Parties agree that this Agreement shall not continue as an
encumbrance against the Property once the Agreement has terminated. Notwithstanding the
foregoing, the provisions of Sections 4.1.3 and 4.1.4 shall remain effective coterminous with
Conditional Use Permit 02-14.
14.2 Encumbrances and Lenders' Rights. The Parties hereby agree that this Agreement
shall not prevent or limit SMES (including without limitation any Development Transferee
hereunder), at any time or from time to time in any manner, at its or their sole discretion, from
encumbering the Property, the improvements thereon, or any portion thereof with any
mortgage, deed of trust, sale and leaseback arrangement, or other security device. CITY
acknowledges that the holder of any such security interest in all or any portion of the Property
may require certain clarifications, interpretations, or modifications to this Agreement or the
Development Plan and CITY agrees, upon request, from time to time, to meet with the
applicable Party and/or representatives of any such holder to negotiate in good faith any such
request for clarification, interpretation, or modification. CITY further agrees that it will not
unreasonably withhold its consent to any such requested clarification or interpretation to the
extent such clarification or interpretation is consistent with the intent and purpose of this
Agreement. A Default under this Agreement shall not defeat, render invalid, diminish, or
impair the lien of any such holder.
The mortgagee of a mortgage or beneficiary of a deed of trust or holder of any other
security interest in the Property or any portion thereof and its or their successors and assigns,
including without limitation the purchaser at a judicial or non judicial foreclosure sale or a
person or entity which obtains title by deed-in-lieu of foreclosure (collectively, a "holder") shall
be entitled to receive a copy of any notice of Default (as defined in Section 9.1 hereof) delivered
-24-
to SMES as to whose portion of the Property such a Default exists and, as a pre-condition to the
institution of legal proceedings or termination proceedings, CITY shall deliver to all such holders
written notification of any Default by SMES in the performance of its obligations under this
Agreement which is not cured within sixty (60) days (the "Second Default Notice") and shall
allow the holder(s) an opportunity to cure such Defaults as set forth herein. The Second Notice
of Default shall specify in detail the alleged Default and the suggested means to cure it. After
receipt of the Second Default Notice, each such holder shall have the right, at its sole option,
within ninety (90) days to cure such Default or, if such Default cannot reasonably be cured
within that ninety (90) day period, to commence to cure such Default, in which case no Default
shall exist and CITY shall take no further action. Notwithstanding the foregoing, if such Default
shall be a Default which can only be remedied by such holder obtaining possession of the
applicable portion of the Property, and such holder seeks to obtain possession, such holder shall
have until ninety (90) days after the date obtaining such possession to cure or, if such Default
cannot reasonably be cured within such period, then to commence to cure such Default. Further,
a holder shall not be required to cure any non-curable Default of SMES, and any such Default
shall be deemed cured if any lender obtains possession.
15. Severability of Terms.
If any term, provision, covenant, or condition of this Agreement shall be determined
invalid, void, or unenforceable, the remainder of this Agreement shall not be affected thereby if
the tribunal finds that the invalidity was not a material part of consideration for the affected Party
or Parties. The covenants contained herein are mutual covenants. The covenants contained
herein constitute conditions to the concurrent or subsequent performance by each Party benefited
thereby of the covenants to be performed hereunder by such benefited Party.
16. Subsequent Amendment to Authorizing Statute.
This Agreement has been entered into in reliance upon the provisions of the Development
Agreement Legislation in effect as of the Effective Date. Accordingly, to the extent that
subsequent amendments to the Development Agreement Legislation would affect the provisions
of this Agreement, such amendments shall not be applicable to this Agreement unless necessary
for this Agreement to be enforceable or required by law or unless this Agreement is modified
pursuant to the provisions set forth in this Agreement and Government Code Section 65868 as in
effect on the Effective Date.
17. Rules of Construction and Miscellaneous Terms.
17.1 Interpretation and Governing Law. The language in all parts of this Agreement
shall, in all cases, be construed as a whole and in accordance with its fair meaning. This
Agreement and any dispute arising hereunder shall be governed and interpreted in accordance
with the internal laws of the State of California, with regard to conflict of laws rules. The
Parties understand and agree that this Agreement is not intended to constitute, nor shall be
construed to constitute, an impermissible attempt to contract away the legislative and
governmental functions of CITY, and in particular, CITY's police powers. In this regard, the
Parties understand and agree that this Agreement is a current exercise of CITY's police powers
25
and except as expressly provided for herein this Agreement shall not be deemed to prevent the
future exercise by CITY of its lawful governmental powers over the Property.
17.2 Section Headings. All section headings and subheadings are inserted for
convenience only and shall not affect any construction or interpretation of this Agreement.
17.3 Gender. The singular includes the plural; the masculine gender includes the
feminine; "shall" is mandatory, "may" is permissive.
17.4 Time of Essence. Time is of the essence regarding each provision of this
Agreement as to which time is an element.
17.5 Recitals. All Recitals set forth herein are incorporated in this Agreement as
though fully set forth herein.
17.6 Entire Agreement. This Agreement constitutes the entire agreement between and
among the Parties with respect to the subject matter hereof, and this Agreement supersedes all
previous negotiations, discussions, and agreements between and among the Parties with respect
thereto.
18. Not for Benefit of Third Parties.
This Agreement and all provisions hereof are for the exclusive benefit of CITY and
SMES and their respective Development Transferees and shall not be construed to benefit or be
enforceable by any third party, excepting only to the extent of the limited rights provided to the
holders of security interests in all or a portion of the Property.
19. Cooperation in Event of Legal Challenge.
CITY agrees to cooperate with SMES as may be needed in order to keep this Agreement
in full force and effect during the entire Term. In the event of any legal action instituted by a
third party or other governmental entity or official challenging the validity or enforceability of
any provision of this Agreement or any of the Development Plan Approval(s) (including without
limitation any Future Development Approvals after the same have been issued by CITY), the
Parties hereby agree to cooperate in defending such action and, in this regard, CITY shall not
allow its default to be taken in such legal action or otherwise compromise the legal action
without SMES's prior written consent. In the event of any such litigation, to the maximum
extent permitted by law this Agreement shall remain in full force and effect while such litigation,
including any appellate review, is pending. Notwithstanding the foregoing, SMES shall be
responsible for all costs, including but not limited to attorney's fees, costs, expert witness fees,
and the like, incurred with respect to any such litigation.
[Remainder of Page Intentionally Left Blank]
-26-
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day
and year dated below.
Dated: 200 "CITY"
CITY OF SAN JUAN CAPISTRANO, a
municipal corporation
By:
Name:
Title: Mayor
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
Dated: 200 "SMES"
ST. MARGARET'S OF SCOTLAND
EPISCOPAL SCHOOL, a California non-profit
public benefit corporation
By:
Name:
Title:
By:
Name:
Title:
_27-
STATE OF CALIFORNIA )
) ss
COUNTY OF ORANGE )
On before me,
a Notary Public,personally appeared
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 declare 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.
Notary Public
[SEAL]
STATE OF CALIFORNIA )
ss
COUNTY OF ORANGE )
On before me,
a Notary Public, personally appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
I declare 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.
Notary Public
[SEAL]
909188.5
EXHIBIT "A"
LEGAL DESCRIPTION AND SITE PLAN OF THE SMES PROPERTY
That certain real property located in the City of San Juan Capistrano, County of Orange, State of California, described as follows:
CAMPUS PARCELS:
Location APN Acres Attached Man Reference
31641 La Novia 666-272-09 11.90 A
27461 Calle Arroyo 666-251-04 1.21 B
27481 Calle Arroyo 666-251-05 1.30 C
Calle Arroyo 666-251-06 3.07 D
Ortega Village Center 666-261-11 0.33 E
Ortega Village Center 666-261-10 0.36 F
Ortega Village Center 666-261-09 0.65 G
Total 18.82
EXPANSION PARCELS:
Location APN Acres Attached Mao Reference
31732 Rancho Viejo Road 666-261-03 1.11 H
31658 Rancho Viejo Road 666-261-02 0.47 I
31648 Rancho Viejo Road 666-261-01 0.38 J
27252 Calle Arroyo 666-232-04 5.20 K
Calle Arroyo 666-123-01&2 0.91 L
Total 8.07
1 - 909188.9
EXHIBIT "A"
Legal Description of ST. Margaret's Episcopal
School
Campus •arcets: A through Gi
Expansion Parcels: H through L
ORTEGA
--
n
CALLE
ARROVO
log
I.
EXHIBIT "B"
NARRATIVE DESCRIPTION OF THE PROJECT
• Construction of a 41,777 SF Performing Arts Education Center and adjacent parking lot
reconfiguration, on the site of the current 7s' and 8t'grade classrooms and Middle School
administration offices
• Construction of a 24,116 SF Middle School classroom building and adjacent pedestrian
area reconfiguration, on the site of two buildings in the Ortega Business Center
• To facilitate construction of the above, installation of new temporary modular classroom
buildings to house displaced 7a' and 8a' grade students
• Renovation of existing Church administrative building and adjacent courtyard
• Reconfiguration of parking space in the Ortega Business Center
• Construction of a new satellite parking facility at La Novia and Calle Arroyo
• Grant of easement over school property to facilitate City construction of a multi-use trail
along La Novia
• Conversion of existing `Sillers Hall' multi-purpose room to a dedicated all-school dining
facility
• Renovation, and possible 10,500 SF second-story expansion, of the Lower School
classroom buildings
• Renovation of the existing Campaigne Center building including a 1,000 SF addition
• Renovation of the second floor of the existing Gateway building
• Renovation and 3,000 SF expansion of the Chapel
• Development of 5 acres of land on Calle Arroyo, currently leased to the Ortega
Equestrian Center, as a multi-sport athletic field, with a 3,000 SF maintenance and
restroom building
• Establishment of calculation procedure for SMES enrollment cap of 1,194 full-time
equivalent students,to exclude the students that would otherwise exceed the cap as
described in Exhibit D.
1 - 909188.5
EXHIBIT "C
DEVELOPMENT PLAN APPROVALS
1. Conditional Use Permit 02-14
2. General Plan Amendment 06-03
3. Rezone 06-06, 07-05
4. Architectural Control 07-22
5. St. Margaret's Episcopal School Master Plan
6. Development Agreement
7. Mitigated Negative Declaration
8. Future Development Approvals (as and when, and in the form and substance, adopted by
CITY).
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document property name.-Error!Unknown document
property name.
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document property name a03/04/IOe63FB3ABe03/B9F}9 - 2 - 909188.5
EXHIBIT "D"
FURTHER DESCRIPTION OF ENROLLMENT CAP AND CITY FEE PAYMENTS .
# of #of Enrollment Cap Total
SJC80 Non- Students
students SJC80 Enrolled
students
1,194 Full-Time 1,194
Terms of Conditional Use Permit 02-14 0 0 Equivalent
Students
Terms of this Agreement — Enrollment
Cap
The first twenty (20) enrolled SJC80 0- 20 0 1,194 Full-Time Up to 1,214
students shall be excluded from the I Equivalent
enrollment cap Students Plus up
to 20 SJC80
Students*
Up to an additional ten (10) enrolled SJC80 21-30 1-10 1,194 Full-Time Up to 1,234
students shall be excluded from the Equivalent
enrollment cap. For each such additional Students Plus up
SJC80 student, one Non-SJC80 student may to 30 SJC80
be enrolled and excluded from the Students and up
enrollment cap to 10 Non-SJC80
Students*
Annual Fee to
Terms of this Agreement — Annual City City
Fee
September 30, 2011 $25,000
September 30,2012 $50,000
September 30, 2013 $75,000
September 30, 2014 and every year $75,000+2%
thereafter Compounded
annually
* The additional SJ80 students (up to 30) and Non-SJ80 students (up to 10) allowed pursuant to
Section 4.1.4 of the Development Agreement shall be exempt from the Cap established by
Conditional Use Permit 02-14 and shall not be included in SMES's annual calculation of full
time equivalent students.
Error!Unknown document property name./Error!Unknown
document property name.-Error!Unknown document
property name.
Error!Unknown document property name..Error!Unknown
document property name.a03/04110 - 3 - 909199.5
TABLE OF CONTENTS
Page
1. DEFINITIONS...................................................................................................................5
1.1 Authorizing Ordinance...........................................................................................5
1.2 Campus Parcels......................................................................................................5
1.3 CEQA.....................................................................................................................5
1.4 CITY......................................................................................................................5
1.5 City Council...........................................................................................................5
1.6 Default....................................................................................................................5
1.7 Develop or Development or Developing...............................................................5
1.8 Developer...............................................................................................................5
1.9 Development Agreement Legislation....................................................................5
1.10 Development Exactions.........................................................................................5
1.11 Development Plan..................................................................................................6
1.12 Development Plan Approval(s)..............................................................................6
1.13 Development Transferee........................................................................................6
1.14 Effective Date ........................................................................................................6
1.15 Expansion Parcels..................................................................................................6
1.16 Future Development Approvals.............................................................................6
1.17 On-Site Improvements...........................................................................................6
1.18 [Reserved]..............................................................................................................7
1.19 Party or Parties.......................................................................................................7
1.20 Property.................................................................................................................. 7
1.21 Planning Commission............................................................................................7
1.22 Project....................................................................................................................7
1.23 Property..................................................................................................................7
1.24 St. Margaret's Episcopal School Master Plan........................................................7
1.25 Term............................................................................................................:..........7
2. GENERAL PROVISIONS ................................................................................................7
2.1 Binding Covenants.................................................................................................7
2.2 Interest of SMES....................................................................................................7
2.3 Term.......................................................................................................................7
2.4 Termination............................................................................................................8
2.5 Transfers and Assignments.................................................................................... 8
3. DEVELOPMENT PROVISIONS .....................................................................................9
3.1 Vesting...................................................................................................................9
3.2 Reserved Authority.............................................................................................. 11
3.3 Further Assurances to SMES Regarding Exercise of Reserved Authority.......... 12
3.4 Vested Right......................................................................................................... 13
3.5 Amendment of Development Agreement............................................................ 14
-1- 909188.5
Page
3.6 Future Amendments to Development Plan.......................................................... 16
3.7 Future Development Approvals........................................................................... 16
4. MISCELLANEOUS OBLIGATIONS OF THE PARTIES............................................ 16
4.1 SMES's Rights and Obligations With Respect to Implementing St. Margaret's
Episcopal School Master Plan ............................................................................. 16
4.2 Future Development Approvals................................................................................. 18
5. INDEMNIFICATION...................................................................................................... 18
6. RELATIONSHIP OF PARTIES...................................................................................... 18
7. AMENDMENT OR CANCELLATION OF AGREEMENT......................................... 18
8. PERIODIC REVIEW OF COMPLIANCE WITH AGREEMENT................................ 19
8.1 Periodic Review................................................................................................... 19
8.2 Good Faith Compliance....................................................................................... 19
8.3 Failure to Conduct Annual Review...................................................................... 19
8.4 Initiation of Review by City Council................................................................... 19
8.5 Administration of Agreement.............................................................................. 19
8.6 Availability of Documents................................................................................... 19
9. EVENTS OF DEFAULT: REMEDIES AND TERMINATION.................................... 19
9.1 Defaults by SMES................................................................................................ 19
9.2 Defaults by CITY.................................................................................................20
9.3 Specific Performance Remedy.............................................................................20
9.4 Institution of Legal Action...................................................................................21
9.5 Estoppel Certificates............................................................................................21
10. WAIVERS AND DELAYS.............................................................................................21
10.1 No Waiver............................................................................................................21
10.2 Third Parties.........................................................................................................22
10.3 Force Majeure......................................................................................................22
10.4 Extensions.......................:....................................................................................22
10.5 Notice of Delay....................................................................................................22
11. NOTICES.........................................................................................................................22
12. ATTORNEYS' FEES.......................................................................................................23
13. RECORDING..................................................................................................................24
-ii- 909188.5
Page
14. EFFECT OF AGREEMENT ON TITLE ........................................................................24
14.1 Effect on Title......................................................................................................24
14.2 Encumbrances and Lenders' Rights.....................................................................24
15. SEVERABILITY OF TERMS ........................................................................................25
16. SUBSEQUENT AMENDMENT TO AUTHORIZING STATUTE...............................25
17. RULES OF CONSTRUCTION AND MISCELLANEOUS TERMS.............................25
17.1 Interpretation and Governing Law.......................................................................25
17.2 Section Headings .................................................................................................25
17.3 Gender..................................................................................................................25
17.4 Time of Essence...................................................................................................25
17.5 Recitals.................................................................................................................26
17.6 Entire Agreement.................................................................................................26
18. NOT FOR BENEFIT OF THIRD PARTIES...................................................................26
19. COOPERATION IN EVENT OF LEGAL CHALLENGE.............................................26
-111- 909188.5
Recorded at the request of and mail to: EXHIBIT B
City Clerk
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano,CA 92675
(Space Above This Line for Recmder9 Office Use Only)
(Exempt from Recording Fee per Gov.Code§§6103 and 27383)
APN: 666-272-09, 666-251-04, 666-251-05, 666-251-06, 666-261-11, 666-261-10, 666-261-09, 666-261-03, 666-
261-02, 666-261-01, 666-232-04, 666-123-01&2
COVENANT AND AGREEMENT
REGARDING MITIGATION OF FINANCIAL IMPACTS AND CALCULATION OF STUDENT
ENROLLMENT CAP
RECITALS
A. ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL ("Owner') hereby certifies that
it is the owner of real property located in the City of San Juan Capistrano, State of California,
Assessor's Parcel Numbers , which is legally described as follows (and more
particularly described in the attached Exhibit "A") ("Property'):
[SEE ATTACHED EXHIBIT A]
B. Owner and City have entered into the Development Agreement recorded concurrently
herewith and adopted on 2010 pursuant to City Council Ordinance No.
(St. Margaret's Episcopal School Expansion Project) securing the issuance of various land use
entitlements allowing the Owner to expand its existing educational institution on said Property
consistent with the Development Plan described therein.
C. This Covenant and Agreement is executed and recorded for the purpose of
memorializing the provisions of Section 4.1.3 and 4.1.4 of the Development Agreement
applicable to the Property that survive termination of the Development Agreement, and
providing constructive notice of the provisions of Section 4.1.3 and 4. of the Development
Agreement to any successors or assignees of Owner's fee interest therein. Any capitalized
terms not defined herein shall have the meanings ascribed to such terms in the Development
Agreement.
COVENANTS
1. The Owner hereby agrees and covenants with the City of San Juan Capistrano ("City')
that so long as the above legally-described property shall be held for use pursuant to
Conditional Use Permit 02-14 as an educational institution exempt from taxation it shall fully
mitigate potential financial impacts of lost property tax and sales tax revenues to the City of
San Juan Capistrano and its residents associated with the Development Plan by making the
following payments to the City for its general fund each year:
1
672404.1
945080.1
(1) $25,000 by September 30, 2011
(2) $50,000 by September 30, 2012
(3) $75,000 by September 30, 2013 and by September 30 of every year thereafter
(4) The above payments in item (3) shall be increased by 2% compounded annually
beginning October 1, 2013.
2. The City hereby agrees and covenants with the Owner that compliance with the student
enrollment cap established by Conditional Use Permit 02-14 ("Cap") shall be determined
annually, based on Owner's enrollment count as reported to the Department of Education. In
order to encourage enrollment of high-need San Juan Capistrano students, Owner shall be
entitled to enroll students who will be exempt from the Cap, as detailed below:
(1) Owner may, in its sole discretion, enroll up to thirty (30) students who are
residents of San Juan Capistrano and are receiving financial aid of 80% or more
of tuition fees ("SJC80 Students"); and
(2) For each SJC80 Student in excess of twenty (20) (i.e. for the 21st through
30th SJC80 Student enrolled), Owner may, in its sole discretion, enroll up to one
additional student ("Non-SJC80 Student") up to a maximum of ten (10) Non-
SJC80 Students.
(3) The SJC80 students (up to 30) and Non-SJC80 students (up to 10)
allowed by this Section 4.1.4 shall be exempt from the Cap established by
Conditional Use Permit 02-14 and shall not be included in Owner's annual
calculation of full time equivalent students.
The traffic and other, potential impacts associated with the increased number of students
authorized by this Covenant and Agreement are mitigated to a level below significant by the
Development Plan.
3. This Covenant and Agreement shall run with all of the above-described land and shall
be binding upon and inure to the benefit of the City and the Owner, and all future owners,
encumbracers, their successors, heirs or assignees and shall continue in effect until released
by the authority of the City Council of the City upon evidence that this Covenant and
Agreement is no longer required.
IN WITNESS WHEREOF, the Parties hereto have executed this Covenant and
Agreement on the day and year dated below.
Dated: , 2010 ,CITY"
CITY OF SAN JUAN CAPISTRANO, a municipal
corporation
By:
Name:
Title: Mayor
ATTEST:
2
672404.1
945080.1
Maria Morris, City Clerk
APPROVED AS TO FORM:
Omar Sandoval, City Attorney
Dated: 2010 "OWNER"
ST. MARGARET'S OF SCOTLAND EPISCOPAL
SCHOOL, a California non-profit public benefit
corporation
By:
Name:
Title:
By:
Name:
Title:
Dated this day of
3
672404.1
945080.1
EXHIBIT"A"
LEGAL DESCRIPTION OF THE SMES PROPERTY
That certain real property located in the City of San Juan Capistrano, County of Orange, State
of California, described as follows:
CAMPUS PARCELS:
Location APN Acres
31641 La Novia 666-272-09 11.90
27461 Calle Arroyo 666-251-04 1.21
27481 Calle Arroyo 666-251-05 1.30
Calle Arroyo 666-251-06 3.07
Ortega Village Center 666-261-11 0.33
Ortega Village Center 666-261-10 0.36
Ortega Village Center 666-261-09 0.65
Total 18.82
EXPANSION PARCELS:
Location APN Acres
31732 Rancho Viejo Road 666-261-03 1.11
31658 Rancho Viejo Road 666-261-02 0.47
31648 Rancho Viejo Road 666-261-01 0.38
27252 Calle Arroyo 666-232-04 5.20
Calle Arroyo 666-123-01&2 0.91
Total 8.07
4
672404.1
945080.1
STATE OF CALIFORNIA )
COUNTY OF ORANGE )
On before me, a 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 declare 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.
Notary Public
5
672404.1
945080.1
AFFIDAVIT OF PUBLICATION PROOF OF PUBLICATION
STATE OF CALIFORNIA, )
) Ss.
County of Orange )
I art a citizen of the [Jutted States and a resident
of the County aforesaid, I am over the age of
eighteen years, and not a party to or interested in CITY OF SAN JUAN CAPISTRANO
INTRODUCTION OF AN ORDINANCE
the above entitled matte Y. I and the principal clerk Nefiee is heraby gloom that on March 16,2010 the city Council will consider attention of an
of the Capistrano Valley News, a newspaper ordinance castled:
AN ORDINANCE OF THE CITY EV SAN JUAN AGREEMENT
CALIFORNIA,AP-
PROVING AND ADOPTING A DEVELOPMENT AGREEMENT FOR THE SAINT
that has been adJndged t0 be a newspaper Of ETSOF COTI-AND
SCHOOL)RPLANPROJECT(ST.MARGAR-
ET'S OF SCOTLAND EPISCOPAL SCHOOL)
general circulation by the Superior Court of the The development agreement approves a project that consists of ex ending an existing
k-12 nvate school campus by 75,251 gross square feet(GSF)from 15].731 to 232,902
(GSF)and to expand the campus acreage from 1].48 to 2664 acres located at 31641 Le
County of Orange, State of California, on June 7, Novia Avenue, and generally located along the west side of La Nevis Avenue between
Calle Arroyo and Rancho Viejo Road an the north ads of Calle Arroyo between La Nevis
Avenue and Rancho Viejo Road on pro erty located at 31641
1984, Case No. A-122949 in and for the City of Noma Avenue wnlen is General PPandeargnafed s gPaben s maewfienal and "3.6
Neighborhood Commerceir and classified as"PC" (Planned C(ammunity)on the Official
Zoning Map and which requires an amendment to the land use designations established
San Juan Capistrano, County Of Orange, State of by Comprehensive Development Plane-01,Ortega Business Center.
California; that the notice, Of which the annexed
A certrfred copy of the complete text of the Ordinance Is posted and may be read in the
City Clerks Department,32400 Paseo Adelson,San Juan Capistrano.and/or a copy may
be obtained from that office at a nominal charge.
ir;a if printed copy, has been published in each Dated March 3,2010
regular and entire issue of said newspaper and Is/Maria Monis,Cry Clerk
Miah'.Capistrano Valley News,March 11,20109213574
not in any supplernen( thereof on the following
dates. to wit:
March 11,2010
"I certify (or declare) under the penalty of
perjury under the laws of the State of California
that the foregoing is true and correct":
t,XCCUted at Santa Ana, Orange County,
California, on
Date: March 11,20 10
car
Signature ➢' o
21 ED 1J
a M
Capistrano Valley News c y
625 N. Grand Ave. _
Santa Ana,CA 92701 — 00
(714)796-2209
N3 i
Cn
�1 �
h1AR-lW-217110 11:25 OCR 714?952232 P.O3
CRY OF SAN JUAN CAPISTRANO
INTRODUCTION OF AN ORDINANCE
Notice is hereby Amen that on March 16,2010 the City Council will consder adoption of an
Comence emdled
AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO,CALIFORNIA,AP-
PROVING AND ADOPTING A DEVELOPMENT AGREEMENT FOR THE SAINT
MARGAREPS EPISCOPAL SCHOOL MASTER PIAN PROJECT(ST.MARGAR-
ET'S OF SCOTLAND EPISCOPAL SCHOOL)
The devenooment agreement approves a protect that omelets of sWalWinp an exletln0
k.12 private school tempus by 15,251 gross square feet(GSF)from 157,731 to 232.9d2
(GSF)and to expand the campus acreage from 17.48 to 2664 acres located at 31641 La
Novae Avenue, and penemllp boated alone the west side of La Novia Avenue between
Calle Arroyo and Rancho ViI Read an the north aide gt Calle Arroyo between La N.
Avenue and Rancho Vlelo Road on propedy,located at 31641
La News Avenue which is Gerleml Plandev.phated "5.0P Pubic&Institutional and "3 0
Nmghborhood Commercial'and Gasseaed as"PC' (Planned Community)on the Oeacaal
2onlnp Map and which haul an amendment to the land uee designations establiehod
by Comprehensive Development Plan 75-01,Ortega Business Center.
A cemtmb copy of the Complete had of the Ordinance is posted and may,be read In the
Crty Clerk's Department,32400 Paseo Adelanlo,San Juan Capistrano,and/or a copy may
be obeined from that 0111 at a nominal charge.
Oaleo:March 3,2010
/s/Marla Morris,City Clark
Publish:Capistrano Valley News,March 11,20109213574
TOTAL P.03
NOTICE OF TRANSMITTAL
CAPISTRANO VALLEY NEWS
Legal Publications
CHARGE TO ACCOUNT NO. 0041125000
FOR PUBLICATION ON: THURSDAY, March 11, 2010
DOCUMENT TO BE PUBLISHED: CITY OF SAN JUAN CAPISTRANO —
INTRODUCTION OF ORDINANCE —
St. Margaret's Episcopal School Master
Plan — Development Agreement
PROOF OF PUBLICATION: Please send to:
City Clerk's Office, City Hall
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
fax (949) 493-1053/telephone (949) 493-1171
AUTHORIZED BY:
Marollcls, Ci erk
DATE: March 3, 2010
Date notice published - 03/11/2010
Date affidavit received -
Date notice posted in
designated posting places (3) - 03/11/2010
CITY OF SAN JUAN CAPISTRANO
INTRODUCTION OF AN ORDINANCE
Notice is hereby given that on March 16, 2010 the City Council will consider adoption of
an Ordinance entitled:
AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO,
CALIFORNIA, APPROVING AND ADOPTING A DEVELOPMENT
AGREEMENT FOR THE SAINT MARGARET'S EPISCOPAL SCHOOL
MASTER PLAN PROJECT (ST. MARGARET'S OF SCOTLAND
EPISCOPAL SCHOOL)
The development agreement approves a project that consists of expanding an existing
k-12 private school campus by 75,251 gross square feet (GSF) from 157,731 to
232,982 (GSF) and to expand the campus acreage from 17.48 to 26.64 acres located at
31641 La Novia Avenue, and generally located along the west side of La Novia Avenue
between Calle Arroyo and Rancho Viejo Road an the north side of Calle Arroyo
between La Novia Avenue and Rancho Viejo Road on property located at 31641
La Novia Avenue which is General Plan-designated "5.0-Public & Institutional and "3.0
Neighborhood Commercial" and classified as "PC" (Planned Community) on the Official
Zoning Map and which requires an amendment to the land use designations established
by Comprehensive Development Plan 78-01, Ortega Business Center.
A certified copy of the complete text of the Ordinance is posted and may be read in the
City Clerk's Department, 32400 Paseo Adelanto, San Juan Capistrano, and/or a copy
may be obtained from that office at a nominal charge.
Dated: March 3, 2010
/s/ Maria Morris, City Clerk
Publish: Capistrano Valley News, March 11, 2010
Christy Jakl
From: Christy Jakl
Sent: Wednesday, March 03, 2010 11:43 AM
To: 'Michael Collins'
Cc: Maria Morris
Subject: Items for Publication - City of SJC
Attachments: 10-0216 St. Margaret's Ord- Development Agreement.doc; 10-0302 Urgency O 967 -temp
signs.doc; 10-0216 St. Margaret's Ord.doc
Importance: High
Good Morning,
Attached are items for publication from the City Clerk's office of the City of San Juan Capistrano.
Included in the attachments are the Notice of Transmittal with appropriate publication date(s) and
account number as well as the publication. Please email or fax a proof to my attention at (949)493-
1053 or oakl(alsanjuancapistrano.org for review and approval.
Sincerely,
Christi Jaki
Administrative Specialist, City Clerk's Office
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
(949) 443-6310 1 (949) 493-1053 fax
1
3/16/2010
AGENDA REPORT H1
TO: Joe Tait, City Managey %r
FROM: Maria Morris, City Clerk
SUBJECT: Adoption of an Ordinance Approving a Development Agreement
for St. Margaret's Episcopal School Master Plan
(St. Margaret's Episcopal School)
RECOMMENDATION:
By motion, approve second reading and adoption of an ordinance entitled,
"AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO, CALIFORNIA,
APPROVING AND ADOPTING A DEVELOPMENT AGREEMENT FOR THE
ST. MARGARET'S EPISCOPAL SCHOOL MASTER PLAN PROJECT
(ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL)"
SITUATION:
On March 2, 2010 the City Council approved, first reading and introduction of an
ordinance approving the Development Agreement for the St. Margaret's Episcopal
School Master Plan Project. Staff recommends the City Council approve the second
reading and adoption of this ordinance. The ordinance will go into effect 30 days after
its passage.
NOTIFICATION:
The City Clerk's office will provide all necessary publication and posting of the
ordinance as required by law.
tt;fullysubmittecl, Prepared risJDeputy City Clerk
Attachments: 1. Ordinance
ORDINANCE NO.
AN ORDINANCE OF THE CITY OF SAN JUAN CAPISTRANO
APPROVING AND ADOPTING A DEVELOPMENT AGREEMENT FOR
THE SAINT MARGARETS EPISCOPAL SCHOOL MASTER PLAN
PROJECT (ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL)
The City Council of the City of San Juan Capistrano hereby ordains as follows:
SECTION 1. Recitals & Findings
1. St. Margaret of Scotland Episcopal School has requested approval of a
Development Agreement, entitled "Development Agreement (St. Margaret's
Episcopal School Expansion Project) by and between the City of San Juan
Capistrano and St. Margaret of Scotland Episcopal Schoof'; and,
2. The City's Environmental Administrator reviewed the Initial Study prepared by
Ed Almanza & Associates pursuant to Section 15063 and 15064 of the California
Environmental Quality Act (CEQA) Guidelines; has issued a Mitigated Negative
Declaration pursuant to Section 15070 of those guidelines; has caused a Notice
of Negative Declaration to be posted and mailed to affected property owners
pursuant to Section 15072 of those guidelines; and has otherwise complied with
all applicable provisions of the California Environmental Quality Act (1970); and
all mitigation measures have been included herein; and,
3. The Planning Commission conducted duly-noticed public hearings on June 23,
2009, July 14, 2009, December 8, 2009, January 12, 2010, and January 26,
2010 pursuant to Title 9, Land Use Code, Section 9-2.335, Public Hearing
Procedures to consider the environmental determination and documentation
pursuant to Section 15074 of the California Environmental Quality Act, and to
consider public testimony on the proposed project and has considered all
relevant public comments; and,
4. The City Council conducted a duly-noticed public hearing on February 16, 2010
pursuant to Title 9, Land Use Code, Section 9-2.335, Public Hearing Procedures
to consider the environmental determination and documentation pursuant to
Section 15074 of the California Environmental Quality Act, and to consider public
testimony on the proposed project, has considered all relevant public comments.
SECTION 2. Amendment.
Pursuant to Government Code sections 65864 et seq., the City Council does
hereby approve and adopt the "Development Agreement (St. Margaret's Episcopal
School Expansion Project) by and between the City of San Juan Capistrano and St.
Margaret of Scotland Episcopal Schoor', which is attached as Exhibit A, and
incorporated herein by reference and "Covenant and Agreement Regarding Mitigation of
1 Attachment 1
Financial Impacts and Calculation of Student Enrollment Cap' which is attached as
Exhibit B, and incorporated herein by reference. The Mayor is hereby authorized to
execute said agreement on behalf of the City of San Juan Capistrano.
SECTION 3. Effective Date.
This Ordinance shall take effect and be in force thirty (30) days after its passage.
SECTION 4. City Clerk's Certification
The City Clerk shall certify to the adoption of this Ordinance and cause the same
to be posted at the duly designated posting places within the City and published once
within fifteen (15) days after passage and adoption as required by law; or, in the
alternative, the City Clerk may cause to be published a summary of this Ordinance and
a certified copy of the text of this Ordinance shall be posted in the Office of the City
Clerk five (5) days prior to the date of adoption of this Ordinance; and, within fifteen (15)
days after adoption, the City Clerk shall cause to be published the aforementioned
summary and shall post a certified copy of this Ordinance, together with the vote for and
against the same, in the Office of the City Clerk.
PASSED, APPROVED AND ADOPTED this 16 Id day of March, 2010.
DR. LONDRES USO, MAYOR
ATTEST:
MARIA MORRIS, CITY CLERK
2
Exhibit A
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City Clerk
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
(Space Above This Line for Recorder's Office Use Only)
(Exempt from Recording Fee per Gov.Code§§6103 and 27383)
DEVELOPMENT AGREEMENT
(ST. MARGARET'S EPISCOPAL SCHOOL EXPANSION PROJECT)
by and between
CITY OF SAN JUAN CAPISTRANO
and
ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL
Effective April 15, 2010 (Ordinance No. adopted March 16, 2010)
Exhibit A
DEVELOPMENT AGREEMENT
(ST. MARGARET'S EPISCOPAL SCHOOL EXPANSION PROJECT)
This DEVELOPMENT AGREEMENT (ST. MARGARET'S EPISCOPAL SCHOOL
EXPANSION PROJECT) (the "Agreement") is dated for reference purposes only as of the 2nd
day of March, 2010, and is being entered into by and between the CITY OF SAN JUAN
CAPISTRANO, a municipal corporation, organized and existing under the laws of the State of
California ("CITY"), and ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL, a
California non-profit public benefit corporation ("SMES"), pursuant to the authority of Sections
65864 through 65869.5 of the California Government Code (the "Development Agreement
Legislation") and Article XI, Section 2, of the California Constitution. CITY and SMES are
sometimes hereinafter referred to as the "Parties."
RECITALS
This Agreement is predicated upon the following facts:
A. These Recitals refer to and utilize certain capitalized terms which are defined in
this Agreement. The Parties intend to refer to those definitions in conjunction with the use
thereof in these Recitals.
B. The Development Agreement Legislation authorizes CITY to enter into binding
development agreements with persons having legal or equitable interests in real property for the
development of such property in order to, among other things: ensure high quality development
in accordance with comprehensive plans; provide certainty in the approval of development
projects so as to avoid the waste of resources and the escalation in the cost of housing and other
development to the consumer; provide assurance to the applicants for development projects that
they may proceed with their projects in accordance with existing policies, rules, and regulations,
subject to the applicable conditions of approval, in order to strengthen the public planning
process and encourage private participation in comprehensive planning and reduce the private
and public economic costs of development; and encourage and provide for the development of
public infrastructure and amenities to support the development of new housing and commercial
projects.
C. SMES and its single member, the Protestant Episcopal Church in the Diocese of
Los Angeles ("Diocese"), are the fee owners of that certain real property consisting of 26.89
acres of land located in and adjacent to a block defined by Ortega Highway, La Novia Avenue,
Calle Arroyo and Rancho Viejo Road in the in the City of San Juan Capistrano, County of
Orange, State of California, that is more particularly described and depicted in Exhibit "A"
attached hereto and made a part hereof(the "Property").
D. Of the total Property's 26.89 acres, 18.82 acres comprise the development
commonly known as "St. Margaret's Episcopal School" depicted and described as the "Campus
Parcels" in Exhibit "A", and the remaining approximately 8.07 acres constitute the "Expansion
Parcels" depicted and described in Exhibit "A". The Diocese is the fee owner of the Campus
Parcels and SMES has the exclusive right to use the Campus Parcels pursuant to a Memorandum
of Agreement between SMES and the Diocese and is the owner of all of the buildings thereon.
-1-
SMES is the fee owner of the Expansion Parcels. SMES owns the three Rancho Viejo Road lots
of the Expansion Parcels as the sole member of Ortega III LLC.
E. SMES applied for, and CITY approved Development of the Campus Parcels and
Expansion Parcels pursuant to General Plan Amendment 06-03, Rezone 07-05, Architectural
Control 07-22, Saint Margaret's Episcopal School Master Plan, in accordance with the
provisions of this Agreement, the Saint Margaret's Episcopal School Master Plan ("Master
Plan"), and other applicable regulations of the City of San Juan Capistrano and other
governmental agencies having jurisdiction over the Property and the "Project" as defined in
Section 1.22 below.
F. SMES has applied for, and CITY has approved, this Agreement in order to create
a beneficial development project and a physical environment that will conform to and
complement the goals of CITY, be sensitive to human needs and values, and facilitate efficient
traffic circulation. By its approval and execution of this Agreement CITY has determined that
CITY (including, without limitation the existing and future residents of CITY) will receive the
following direct and indirect benefits from the implementation of this Agreement:
1. The Project will conform to CITY's goal to manage growth through the
use of, among other things, comprehensive planning and design, project-wide continuity
of landscaping and architectural design, state-of-the-art development standards, and
planning concepts.
2. The traffic and circulation elements of the Development Plan will conform
to CITY's General Plan by reducing the impact of the average daily trips generated by the
Development of the Project on arterial roads and thoroughfares adjacent to the Expansion
Parcels consistent with Transportation and Traffic Mitigation Measures set forth in the
Mitigation Monitoring and Reporting Program for the Project.
3. As a religious organization, SMES is exempt from paying property taxes
on land dedicated to educational and religious uses. SMES does pay property taxes today
on the Expansion Parcels, which in the future, upon conversion to school uses, would be
subject to the property tax exemption. Also, the CITY would potentially lose sales tax
revenue as a result of the Project's removal of commercial buildings from the Expansion
Parcels and development of the Expansion Parcels for non-commercial uses.
Notwithstanding the SMES exemption from property taxes by virtue of its status as a
religious organization, in exchange for CITY's agreement to enter into and perform its
obligations set forth in this Agreement, SMES has agreed that SMES shall make an
annual payment to CITY as set forth in Section 4.1.3 below to, among other things,
compensate CITY for the loss of property taxes from removing the Expansion Parcels
from the tax rolls and loss of potential sales tax revenues, thereby providing substantial
benefits to CITY and its residents.
4. The Project will result in the expansion of the existing St. Margaret's
Episcopal School which will be of benefit to CITY and its residents by providing
additional educational resources to the community. Approximately 250 students (20% of
the students currently enrolled at St. Margaret's Episcopal School) are residents of San
-2-
Juan Capistrano, and 700 students (57% of currently enrolled students) would otherwise
attend the Capistrano Valley Unified School District. In exchange for CITY's agreement
to enter into and perform its obligations set forth in this Agreement, SMES has agreed to
provide for increased financial aid to expand enrollment of students who are residents of
San Juan Capistrano, as set forth in Sections 4.1.4 below.
5. The Project will result in dedication of an easement to CITY for a multi-
use trail connector along La Novia Avenue along the frontage of SMES upon CITY's
approval of a final trail alignment as part of CITY's General Plan.
6. . The Project will result in a shared parking agreement with CITY providing
an additional parking lot to serve CITY's Cook Park and Trails that will provide
substantial benefits to CITY and its residents.
7. SMES will allow the Ortega Equestrian Center ("OEC") to continue
operating on the Project site until May 31, 2012 or any later date agreed upon in writing
by both SMES and OEC, and will work with OEC to accommodate relocation of the
facilities in an orderly manner by May 31, 2012, or any later date agreed upon in writing
by both SMES and OEC.
G. The following actions have been taken with respect to this Agreement and the
Project:
1. On or about March 2, 2010, pursuant to the applicable provisions of the
California Environmental Quality Act, Public Resources Code Section 21000 et seq., and
the regulations promulgated by the Secretary of Resources pursuant thereto (Title 14 of
the California Code of Regulations, Section 15000 etseq.) (collectively, "CEQA"), the
City Council of CITY found and determined that all of the significant environmental
impacts of the Project, including this Agreement, were adequately mitigated and adopted
a Mitigated Negative Declaration;
2. On or about March 2, 2010, the City Council of CITY approved the
Project;
3. On or about January 26, 2010, following a duly noticed and conducted
public hearing, the Planning Commission of CITY recommended to the City Council that
it approve this Agreement;
4. On or about March 2, 2010, after a duly noticed and conducted public
hearing, the City Council of CITY determined that the provisions of this Agreement are
consistent with the General Plan of CITY; and
5. On or about March 2, 2010, after a duly noticed and conducted public
hearing, the City Council of CITY introduced Ordinance No. approving and
authorizing the execution of this Agreement and on March 16, 2010, the City Council of
CITY adopted said Ordinance (hereinafter the "Authorizing Ordinance"), a copy of which
Authorizing Ordinance is on file in the City Clerk's office at City Hall.
-3-
H. In consideration of the substantial public improvements and benefits to be
provided by SMES and the Project, and in order to strengthen the public planning process and
provide significant educational and economic benefits to the City of San Juan community, by
this Agreement CITY intends to provide to SMES the assurance that it can proceed with
Development of the Project for the Term of this Agreement pursuant to the terms and conditions
of this Agreement and in accordance with the CITY's General Plan, ordinances, policies, rules,
and regulations existing as of the Effective Date. In reliance on CITY's covenants in this
Agreement concerning Development of the Property, SMES has and will in the future incur
substantial costs in site preparation and the construction and installation of major infrastructure
and facilities in order to make the Master Plan feasible.
I. Pursuant to Section 65867.5 of the Development Agreement Legislation, the City
Council has found and determined that: (i) this Agreement and the Development Plan for the
Project implement the goals and policies of CITY's General Plan, provide balanced and
diversified land uses and impose appropriate standards and requirements with respect to land
development and usage in order to maintain the overall quality of life and the environment
within the City of San Juan Capistrano, (ii) this Agreement is in the best interests of and not
detrimental to the public health, safety, and general welfare of CITY and its residents; (iii)
adopting this Agreement is consistent with CITY's General Plan and constitutes a present
exercise of CITY's police power; and (iv) this Agreement is being entered into pursuant to and in
compliance with the requirements of Section 65867 of the Development Agreement Legislation.
J. CITY and SMES agree that it may be beneficial to enter into additional
agreements and operating memoranda, or to modify this Agreement with respect to the
implementation of the separate components of the Development Plan when more information
concerning the details of each component is available, and that this Agreement should expressly
allow for such contemplated additional agreements, operating memoranda, and modifications to
this Agreement.
AGREEMENT
NOW, THEREFORE, pursuant to the authority contained in the Development Agreement
Legislation, as it applies to CITY, pursuant to Article XI, Section 2 of the California
Constitution, and in consideration of the foregoing recitals of fact, all of which are expressly
incorporated into this Agreement, the mutual covenants set forth in this Agreement, and for the
further consideration described in this Agreement, the Parties agree as follows:
1. Deflinitions.
The following words and phrases are used as defined terms throughout this Agreement
and each defined term shall have the meaning set forth below:
1.1 Authorizing Ordinance. "Authorizing Ordinance" means Ordinance No.
approving this Agreement.
1.2 Campus Parcels. "Campus Parcels" has the meaning ascribed in Recital D of this
Agreement.
-4-
1.3 CE-QA. "CEQA" has the meaning ascribed to that term in Recital F.1 of this
Agreement.
1.4 CITY, "CITY" means the City of San Juan Capistrano, a California municipal
corporation, duly organized and existing under the Constitution and laws of the State of
California, and all of its officials, employees, agencies, and departments.
1.5 City Council. "City Council" means the duly elected and constituted city council
of CITY.
1.6 Default. "Default" has the meaning ascribed in Section 9.1 or 9.2 of this
Agreement, as applicable.
1.7 Develop or Development or Developin¢. "Develop" or "Development" or
"Developing" means the improvement and use of the Property for purposes consistent with the
Project and this Agreement, including, without limitation: subdividing, grading, the construction
of infrastructure and public facilities related to the St. Margaret's Episcopal School Master Plan,
the construction of structures and buildings, and the installation of landscaping, all in accordance
with the provisions of this Agreement, but does not include the maintenance, repair,
reconstruction, or redevelopment of any building, structure, improvement, or facility after the
initial construction and completion thereof.
1.8 Developer. Developer means St. Margaret's of Scotland Episcopal School, all
successors in interest, in whole or part, to the right, title, and interest of any of such entity in and
to this Agreement with respect to all or any portion of the Property.
1.9 Development Agreement Legislation. "Development Agreement Legislation"
means Sections 65864 through 65869.5 of the California Government Code as it exists on the
Effective Date.
1.10 Development Exactions. "Development Exactions" means any requirement of
CITY for the dedication of land (including without limitation through the encumbrance of land
with an easement or use restriction in favor of a public agency, the public, or a private non-profit
entity), the construction or improvement of public improvements or facilities (including without
limitation improvements or facilities located on land that is encumbered with an easement or use
restriction in favor of a public agency, the public, or a private non-profit entity), or the formation
of any Financing District and/or payment of any special taxes, assessments, or fees, in order to
provide any such public improvements or facilities in conjunction with Development or to
lessen, offset, mitigate, or compensate for the impacts of development on the environment or
other public interests consistent with the Project and this Agreement.
1.11 Development Plan. "Development Plan" means the plan for Developing the
Project on the Property in accordance with this Agreement, the Development Plan Approval(s),
and the Future Approvals. As of the Effective Date, the Development Plan consists of the
Master Plan, provisions of CITY's General Plan (as amended through the General Plan
Amendment referred to in Recital E) applicable to the Property, the narrative description of the
Project set forth in Exhibit "B"to this Agreement, the Development Plan Approvals set forth in
Exhibit "C"to this Agreement, and the express provisions set forth in this Agreement that define
-5-
or describe the Project. The Future Development Approvals automatically shall become a part of
the Development Plan and included within the scope of SMES's vested rights provided for in this
Agreement without the need for any amendment of this Agreement when the same are issued or
approved by CITY and become effective. Each of the documents memorializing the
Development Plan is (or will be) maintained in the official records of CITY and shall be utilized
whenever required to interpret or apply this Agreement.
1.12 Development Plan Approval(s). "Development Plan Approval(s)" means the
approvals of the City Council described in Exhibit "C" hereto insofar as the same relate to the
Property and the Development Plan, including those amendments to this Agreement made in
accordance with Section 3.5 hereof, those amendments to the Development Plan Approval(s)
made in accordance with Section 3.6 hereof, and those Future Development Approvals made in
accordance with Section 3.7 hereof.
1.13 Development Transferee. "Development Transferee" means a person or entity
that expressly assumes obligations under this Agreement pursuant to Section 2.5 hereof.
1.14 Effective Date. "Effective Date" means the date the Authorizing Ordinance
becomes effective.
1.15 Expansion Parcels. "Expansion Parcels" has the meaning ascribed in Recital D of
this Agreement.
1.16 Future Development Approvals. "Future Development Approvals" means those
entitlements and approvals that are: (a) made in accordance with Section 3.7 hereof; and
(b) requested by SMES in order to authorize the Development to occur upon the Property in a
manner consistent with the Development Plan Approval(s). By way of enumeration, and not
limitation of the foregoing, the Future Development Approvals include such development
permits, development plan reviews, use permits, variances, grading permits, building permits,
and occupancy permits that are required as a condition to SMES's right to Develop pursuant to
the Development Approvals for all or any portion of the Project. There is no intention to include
any approvals that are beyond the implementation of the specific development listed on Exhibit
B.
1.17 On-Site Improvements. "On-Site Improvements" means physical infrastructure
improvements or facilities that are or will be located on the Property consistent with the
Development Plan Approvals.
1.18 [RESERVED]
1.19 Party or Parties. "Party" means either CITY or SMES, as the context dictates, and
"Parties"means CITY and SMES.
1.20 Property. "Property" means the Property referred to in Recital C and more
particularly described in Exhibit "A"to this Agreement.
1.21 Planning Commission. "Planning Commission" means the duly appointed and
constituted planning commission of CITY.
-6-
1.22 Project. "Project" means the Development and approvals summarized in
Recital E, the planning elements of which are more specifically described in Exhibit "B"hereto.
1.23 Propert . "Property" means the Property referred to in Recital C and more
particularly described in Exhibit "A"to this Agreement.
1.24 St. Margaret's Episcopal School Master Plan. "St. Margaret's Episcopal School
Master Plan" means the Master Plan approved by CITY Council Resolution No. 10-03-02-03.
1,25 Term. "Term" means the period of time that this Agreement remains in effect
with respect to the Property or any portion thereof, as provided in Section 2.3.
2. General Provisions.
2.1 Binding Covenants. The provisions of this Agreement to the extent permitted by
law shall constitute covenants which shall run with the Property for the benefit thereof, and the
benefits and burdens of this Agreement shall bind and inure to the benefit of the Parties and all
successors in interest to the Parties hereto.
2.2 Interest of SMES. As of the date this Agreement is being executed by the Parties,
SMES represents that SMES and its single member, the Protestant Episcopal Church in the
Diocese of Los Angeles ("Diocese"), are the fee owners of that certain real property consisting
of 26.89 acres of land located in and adjacent to a block defined by Ortega Highway, La Novia
Avenue, Calle Arroyo and Rancho Viejo Road in the in the City of San Juan Capistrano,
County of Orange, State of California, that is more particularly described and depicted in
Exhibit "A" attached hereto and made a part hereof(the "Property"). Of the total Property's
26.89 acres, 18.82 acres comprise the development commonly known as "St. Margaret's
Episcopal School" depicted and described as the "Campus Parcels" in Exhibit "A", and the
remaining approximately 8.07 acres constitute the "Expansion Parcels" depicted and described
in Exhibit "A". The Diocese is the fee owner of the Campus Parcels and SMES has the
exclusive right to use the Campus Parcels pursuant to a Memorandum of Agreement between
SMES and the Diocese and is the owner of all of the buildings thereon. SMES is the fee owner
of the Expansion Parcels. SMES owns the three Rancho Viejo Road lots of the Expansion
Parcels as the sole member of Ortega III LLC.
2.3 Term. Subject to the provisions of Section 10.4 of this Agreement, the initial
term (hereinafter called "Tenn") of this Agreement shall commence on the Effective Date and
shall terminate at the end of the day immediately preceding the twentieth (20th) anniversary of
the Effective Date, subject to the termination provisions set forth herein; provided, however,
that so long as SMES is not in Default of this Agreement and the Agreement has not been
otherwise terminated, SMES may, without the prior written consent of CITY, extend the Term
for one (1) additional period of two (2) years; and provided further that with respect to such 2-
year extension option, SMES shall give CITY written notice of its intent to extend the Term not
more than one hundred eighty(180) days and not less than sixty(60) days before the end of the
initial Term. Pursuant to California Government code sections 65863.9 and 66452.6(a), the
expiration date of all Development Plan Approval(s) shall be extended through the Term of this
Agreement, and any extension pursuant to this Section 2.3. Notwithstanding any other
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provision of this Agreement, the provisions of Sections 4.1.3 and 4.1.4 shall survive termination
of this Agreement and shall remain in effect coterminous with Conditional Use Permit 02-14.
2.4 Termination. This Agreement shall be deemed terminated and of no further effect
upon the occurrence of any of the following events:
(i) If termination occurs pursuant to any specific provision of this Agreement;
or
(ii) As to provisions of this Agreement governing On-Site Improvements on
any separate legal lot(s) or parcel(s) within the Property, upon the completion of On-Site
Improvements on and with respect to said lot(s) or parcel(s) pursuant to the terms of this
Agreement and CITY's issuance of all required occupancy permits or final inspections, as
applicable, and acceptance of all dedications and improvements required to complete
such On-Site Improvements; or
(iii) Entry after all appeals have been exhausted of a final judgment or issuance
of a final order directed to CITY invalidating this Agreement.
The termination of this Agreement in its entirety or with respect to a particular lot(s) or
parcel(s) shall not affect any right or duty of SMES arising from any provisions of this
Agreement that remain effective or from a source other than this Agreement.
In the event this Agreement terminates in its entirety or with respect to a particular lot(s)
or parcel(s), and notwithstanding any other provision set forth herein, upon request by SMES, or
any other successor or assignee of either of them, CITY shall cooperate, at no cost to CITY, in
executing in recordable form a document prepared by the requesting party that confirms the
termination of this Agreement with respect to the Property or applicable portion thereof.
2.5 Transfers and Assignments.
2.5.1 SMES and/or the Protestant Episcopal Church in the Diocese of Los
Angeles ("Owners") shall not assign all or any part of this Agreement without the prior written
approval of the City. Such written approval by the City shall not be unreasonably withheld,
provided that: (a) if Owners' proposed assignee is an entity, such entity shall be legally formed
and qualified to conduct business in the State of California; (b) Owners shall have delivered
evidence to City that Owners' proposed assignee has the ability to comply with the Agreement;
(c) Owners and its/their assignee execute an assignment and assumption agreement pursuant to
which the assignee expressly assumes all of Owners' obligations under the Agreement; and (d)
City shall bear no expenses in connection with such assignment. Notwithstanding any other
provision of this Agreement, Owners need not obtain the prior written approval of City for the
assignment of this Agreement to a limited liability company, limited partnership or corporation
wholly-owned by, or under common control with, Owners.
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3. Development Provisions.
3.1 Vesting.
3.1.1 Project. CITY covenants SMES has and shall have the right to Develop
the Project on the Property consistent with the Development Plan and the Development Plan
Approval(s), including, without limitation, the Future Development Approvals after the same
have been issued or approved by CITY and become effective ("vested right").
3.1.2 Limits on Development. The California Supreme Court held in Pardee
Construction Company v. City of Camarillo, 37 Ca1.3d 465 (1984), that the failure of the parties
to address certain limits on a city's ability to condition, restrict, or regulate a development
allowed a later adopted initiative to restrict the development. This Agreement is intended to cure
that deficiency by expressly addressing the timing for the Development, the vested rights
afforded by this Agreement, and the scope of CITY's reserved authority described in Section 3.2
hereof. Except as expressly set forth in the Development Plan and Development Plan
Approval(s), regardless of any future enactment, whether by initiative or otherwise, SMES shall
have the vested right to Develop the various components of the Project in such order, at such
rate, in one phase or in multiple phases, and at such times as SMES deems appropriate within the
exercise of its subjective business judgment. Specifically, CITY agrees that SMES shall be
entitled to apply for and receive the Future Development Approvals and to Develop and use the
Property at any time, provided that such application is made and such Development occurs in
accordance with this Agreement and the other Development Plan Approval(s). No future
amendment of any CITY law and no future adoption of any CITY law or other action that
purports to limit the scope, rate, or timing of Development on the Property or to alter the
sequencing of the Development in a manner inconsistent with the Development Plan or the
Development Plan Approval(s) (including without limitation the Future Development Approvals
when issued by CITY), whether the same are adopted or imposed by the City Council or through
the initiative or referendum process, shall apply to the Property. Notwithstanding the foregoing,
nothing in this Section 3.1 shall limit or restrict CITY's reserved authority as described in
Section 3.2.
3.1.3 Entitlements, Permits, and Approvals—Cooperation.
3.1.3.1 Processing. CITY agrees that it shall accept and expeditiously
process, pursuant to CITY's regular procedures, complete applications for the Future
Development Approvals and, if applicable, SMES's complete applications for
amendments to this Agreement, to the Development Plan Approval(s), and to any of the
Future Development Approvals (after the same have been initially approved).
3.1.3.2 Other Permits. CITY further agrees to reasonably cooperate
with SMES, at no cost to CITY, in securing any County, State, and Federal permits or
authorizations which may be required in connection with Development of the Property
that are consistent with the Development Plan and Development Plan Approval(s);
provided, that nothing in this Section 3.1.3.2 shall be deemed to require CITY's
assumption of any obligations under any said permits or authorizations.
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3.1.3.3 Acquisition of Off-Site Property. CITY shall not postpone or
refuse approval of any Future Development Approval because SMES or a Development
Transferee has failed to acquire off-site property required for the construction or
installation of offsite improvements. To the extent CITY, SMES, or a Development
Transferee does not have sufficient title or interest to permit any of such offsite
improvements that are such entity's responsibility to be constructed or installed at the
time the application for a Future Development Approval is processed or approved by
CITY, SMES or the Development Transferee shall make a good faith effort to acquire the
required property. If SMES or the Development Transferee is unable to acquire the
required property, CITY shall consider in good faith the acquisition of the required
property. If CITY is unable to acquire the required property by negotiation or
condemnation within the time frame provided for in Govemment Code Section 66462.5,
CITY shall continue to issue the Future Development Approval(s) for the Property
despite the fact that the offsite improvement has not been completed. Notwithstanding
the foregoing, CITY's obligation to continue to issue the Future Development Approvals
as provided for in this Section is contingent upon: (i) SMES or the Development
Transferee submitting the improvement plans required for the improvement to CITY; and
(ii) consistent with Government Code Section 66462.5, SMES or the Development
Transferee entering into a mutually acceptable agreement with CITY that requires SMES
or the Development Transferee to pay or reimburse or secure the future payment or
reimbursement of CITY for SMES's fair share of the costs incurred in acquiring the land
and constructing the applicable offsite improvement(s) at such time as CITY acquires the
required land.
3.2 Reserved Authority.
3.2.1 Reservation of Authority With Respect to Future Development
Approvals: Future Changes in Development Exactions. Notwithstanding any other provision set
forth in this Agreement to the contrary, CITY reserves the right after the Effective Date of this
Agreement to change its development standards applicable to the Property and the Project and to
exercise the same degree of discretion and control in its consideration of Future Development
Approvals that it would have in the absence of this Agreement to impose conditions under
CEQA and other applicable laws and regulations that apply to all similar development
throughout the CITY in order to mitigate the Project's impact on the environment, subject to the
following limitations:
(i) No such future changes in CITY's development standards or
mitigation measures shall be inconsistent with the Development Plan, the Project
Development Approvals, or any of the provisions set forth in Sections 3.1 or 4.1-
4.2 of this Agreement, nor shall any such future changes materially jeopardize or
impair the rights of SMES thereunder;
(ii) No change in CITY's development standards or mitigation
measures adopted or imposed after the Effective Date with respect to the affected
portion of the Property shall apply except to the extent the same shall be
applicable to similarly situated properties or projects on a citywide or areawide
basis; and
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(iii) CITY shall not require the Projector the Property to participate in
regional programs (i.e., programs that are not initiated by CITY and that include
properties located in whole or in part outside the City of San Juan Capistrano) nor
shall CITY require the Project or the Property to pay or contribute to regional
Development Exactions to the extent that such programs or Development
Exactions are not in effect as of the Effective Date with respect to the affected
portion of the Property, including without limitation any such programs or
Development Exactions initiated by the County of Orange.
3.2.2 Uniform Codes. This Agreement shall not prevent CITY from applying
to the Project new uniform construction standards adopted by the State of California as State
Codes, such as the Uniform Building Code, National Electrical Code, Uniform Mechanical
Code, and Uniform Fire Code, provided those same standards are applied to all other
development within the City of San Juan Capistrano.
3.2.3 State and Federal Laws and Regulations. SMES shall comply with all
applicable state and federal laws and regulations, provided that nothing in this Agreement shall
be deemed to limit or restrict the right of SMES to contest or challenge the validity of any such
laws or regulations or their applicability to the Property or the Project. In the event that either
CITY or SMES determines that a state or federal law or regulation prevents the full
implementation of the Development Plan and/or any of the Development Plan Approval(s), that
Party shall provide the other Party with written notice of the state or federal law or regulation, a
copy of the law or regulation, and a written statement of the conflicts between such state or
federal law or regulation and this Agreement. Promptly thereafter CITY and SMES shall meet
and confer in good faith in a reasonable attempt to determine whether a modification or
suspension of this Agreement is required, provided that each Party reserves its discretion with
respect thereto. CITY agrees to cooperate with SMES in resolving the conflict in a manner
which minimizes any adverse fiscal or other impact of the conflict upon SMES, provided only
that in no event does CITY agree that in such event it will materially increase its financial
obligations set forth in this Agreement or otherwise materially increase its obligations. CITY
also agrees to process in a prompt manner SMES's proposed changes to the Development Plan
and/or Development Plan Approval(s) as may be necessary to comply with such federal or state
law or regulation; provided, however, that the approval of such changes by CITY shall be subject
to the discretion of CITY, consistent with this Agreement.
3.2.4 Suspension of Development in Order to Protect Health and Safety.
Nothing in this Agreement shall be construed to be in derogation of CITY's police power to
suspend the right of SMES to develop all or any portion of the Project in order to protect the
public health and safety (e.g., in the event of the unavailability of adequate water, wastewater
treatment, or storm drainage facilities). In the event that CITY determines that the public health
or safety require a suspension of SMES's right to develop all or any portion of the Project, the
scope of the suspension shall be limited to the extent determined by CITY to be reasonably
necessary to protect the public health or safety, the term of the suspension shall be limited to the
period of time during which the public health or safety concern continues, and CITY shall
exercise reasonable good faith efforts to minimize the period of such suspension to the extent
that the cause thereof is within CITY's control. As soon as is reasonably practicable after the
commencement of an event that results in a suspension of the rights of SMES to develop
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hereunder due to public health or safety concerns, CITY shall provide SMES with written notice
of the existence of such event, a detailed explanation of CITY's proposed action, and a written
statement of any conflicts with the provisions of this Agreement that require a suspension of any
of the terms hereof. Promptly thereafter CITY and SMES shall meet and confer in good faith in
a reasonable attempt to determine whether a modification or suspension of this Agreement in
whole or in part, is necessary. In such negotiations, CITY and SMES agree to preserve the terms
of this Agreement and the rights of SMES as derived from this Agreement to the maximum
feasible extent while resolving the conflict. CITY agrees to cooperate with SMES in a good faith
reasonable effort to resolve any such conflict in a manner which minimizes any adverse financial
or other impact of the conflict upon SMES without materially increasing the obligations of CITY
under this Agreement. CITY also agrees in such event to process in an expedited manner
SMES's proposed changes to the Development Plan and any previously issued Development
Plan Approval(s) as may be necessary to appropriately respond to the public health and safety
concern with respect to the portion of the Property owned by SMES; provided, however, that the
approval of any such changes by CITY shall be subject to the discretion of CITY, consistent with
this Agreement, and no such change shall apply to any other portion of the Property without the
prior written consent of the owner(s) thereof.
3.3 Further Assurances to SMES Regarding Exercise of Reserved Authority. The
Parties further acknowledge that the public benefits to be provided by SMES to CITY pursuant
to this Agreement are in consideration for and reliance upon assurances that the Property may
be developed and used in accordance with the Development Plan and the Development Plan
Approval(s). Accordingly, while recognizing that the Development of the Property may be
affected by the exercise of the authority and rights reserved and excepted as provided in
Sections 3.1 ("Vesting") and 3.2 ("Reserved Authority"), SMES is concerned that normally the
judiciary extends to local agencies significant deference in the adoption of rules, regulations,
and policies and that in the absence of an express provision set forth in this Agreement such
judicial deference might be construed to permit CITY, in violation of the limitations on its
reserved authority, to attempt to apply rules, regulations, and policies that are inconsistent with
the Development Plan and the Development Plan Approval(s). Accordingly, SMES desires
assurances that CITY shall not, and CITY agrees that it shall not, further restrict or limit the
Development of the Property in violation of this Agreement except in strict accordance with the
reserved authority described in Section 3.2 hereof, which exercising of CITY's reserved
authority shall not be considered to be a violation of this Agreement. In this regard, from and
after the date that CITY approves the St. Margaret Episcopal School Master Plan for the
Project, if SMES judicially (including by way of a reference proceeding) challenges CITY's
purported exercise of its reserved authority as being in violation of this Agreement, SMES shall
bear the burden of alleging that such purported exercise by CITY of its Reserved Authority is
inconsistent with the Development Plan or the Development Plan Approval(s) and CITY
thereafter shall bear the burden of proof in establishing by a preponderance of the evidence that
such exercise of its Reserved Authority is in accordance with and not a violation of this
Agreement.
3.4 Vested Right. By entering into this Agreement and relying thereupon, SMES is
obtaining certain vested rights to proceed with the Development anticipated by the
Development Plan and the Development Approvals and in accordance with the terms and
conditions of this Agreement (as the same may be amended and supplemented from time to
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time as expressly set forth herein). By entering into this Agreement and relying thereupon,
CITY is securing certain public benefits which enhance the public health, safety, and welfare.
CITY therefore agrees to the following:
3.4.1 No Conflicting Enactments. Except as provided in Section 3.2 of this
Agreement, after the Effective Date neither the City Council nor any other agency of CITY shall
enact a rule, regulation, ordinance, or other measure (collectively, "law") applicable to the
Property which is inconsistent or in conflict with this Agreement. Not by way of limitation of
the foregoing, any law, whether by specific reference to this Agreement or otherwise, shall be
considered to be inconsistent and in conflict with this Agreement if it has any of the following
effects:
(i) It limits or reduces the enrollment, density or intensity of the
Project as provided for in the Development Plan or the Development Plan
Approval(s);
(ii) It applies to the Property, but is not uniformly applied by CITY to
all substantially similar development within CITY; or
(iii) It imposes Development Exactions on the Property other than
those in effect on the Effective Date or as otherwise expressly permitted by
Section 3.2.1 of this Agreement.
3.4.2 Consistent Enactments. By way of enumeration and not limitation, the
following types of laws shall be considered consistent and not in conflict with this Agreement:
(i) Laws that provide for the relocation of structures within the
Property pursuant to an application from SMES;
(ii) Laws that provide for changes in the phasing of the Development
pursuant to an application from SMES; and
(iii) Any law that is expressly authorized by this Agreement.
3.4.3 Initiative Measures. In addition to and not in limitation of the foregoing,
it is the intent of SMES and CITY that no moratorium or other limitation (whether relating to the
Development of all or any part of the Property and whether enacted by initiative or otherwise)
affecting site development permits, precise plans, site development plans, building permits,
occupancy certificates, or other entitlements to use approved, issued, or granted within CITY, or
portions of CITY, shall apply to the Property to the extent such moratorium or other limitation
would restrict SMES's right to Develop the various elements of the Project on the Property in
such order and at such rate as SMES deems appropriate.
3.5 Amendment of Develooment Agreement.
3.5.1 Initiation of Amendment. Any Party may propose an amendment to this
Agreement, and all Parties agree that it may be beneficial to enter into additional written
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agreements or modifications of this Agreement in connection with the Development of the
separate components of the Development Plan.
Notwithstanding any provision of this Agreement to the contrary, no amendment
to the Development Plan or to any conditions of approval contained therein shall require an
amendment of this Agreement.
3.5.2 Procedure. Except as set forth in Section 3.5.4 below, the procedure for
proposing and adopting an amendment to this Agreement shall be the same as the procedure
required for entering into this Agreement in the first instance.
3.5.3 Consent. Except as expressly provided in this Agreement, any
amendment to this Agreement shall require the written consent of all affected Parties. An
amendment to this Agreement shall not be deemed to affect a portion of the Property if it does
not alter, jeopardize, or impair the rights and does not increase the obligations of SMES that
owns said portion of the Property. No amendment to all or any provision of this Agreement shall
be effective unless set forth in writing and signed by duly authorized representatives of each of
the affected Parties.
3.5.4 [RESERVED]
3.5.5 Operating Memoranda. The Parties acknowledge that refinements and
further development of the Development Plan may demonstrate that changes are appropriate with
respect to the details and performance of the Parties under this Agreement. The Parties desire to
retain a certain degree of flexibility with respect to the details of the Development Plan and with
respect to those items covered in general terms under this Agreement. If and when the Parties
mutually find that changes, adjustments, or clarifications are appropriate to further the intended
purposes of this Agreement, they may, unless otherwise required by law, effectuate such
changes, adjustments, or clarifications without amendment to this Agreement through operating
memoranda mutually approved by the Parties, which, after execution, shall be attached hereto as
addenda and become a part hereof and which may be further changed and amended from time to
time. To the maximum extent permitted by law, the City Manager shall have the authority, on
behalf of CITY, to approve and execute such operating memoranda and the Headmaster Officer
of SMES shall have the authority, on behalf of SMES, to approve and enter into such operating
memoranda. Unless otherwise required by law or by the Development Plan Approval(s), no such
changes, adjustments, or clarifications shall require prior notice or hearing.
3.6 Future Amendments to Development Plan. The following rules apply to future
amendments to the Development Plan:
3.6.1 SMES's Written Consent. Any Development Plan amendment to which
SMES does not agree in writing shall not apply to the Property while this Agreement is in effect.
3.6.2 Concurrent Development Agreement Amendment. Any Development
Plan amendment requiring amendment of this Agreement shall be processed concurrently with
an amendment to this Agreement.
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3.6.3 Effect of Amendment. Except as expressly set forth in the Development
Plan amendment itself or this Agreement, a Development Plan amendment shall not alter, affect,
impair, or otherwise impact the rights, duties, and obligations of the Parties set forth in this
Agreement.
3.7 Future Development Approvals.
3.7.1 Exercise of CITY Discretion. hi connection with Future Development
Approvals or any other actions which CITY is expressly permitted to take consistent with this
Agreement relating to the Property, to the maximum extent permitted by law CITY shall exercise
its discretion or take action in a manner which complies and is consistent with the Development
Plan, any Development Plan Approval(s) issued by CITY consistent with this Agreement prior to
the date CITY takes final action on the Future Development Approval then in question, and the
other terms and conditions set forth herein.
3.7.2 Concurrent Development Agreement Amendment. Any Future
Development Approval requiring amendment of this Agreement, as provided for in Section 3.5
hereof, shall be processed concurrently with an amendment to this Agreement.
3.7.3 Effect of Future Development Approvals. To the maximum extent
permitted by law and except as expressly set forth in this Section 3.7, a Future Development
Approval shall not alter, affect, impair, or otherwise affect the rights, duties, and obligations of
any of the Parties set forth in this Agreement. To the extent a Future Development Approval is
approved in accordance with Sections 3.7.1 and 3.7.2, the Future Development Approval shall
constitute for all purposes a Development Plan Approval.
4. Miscellaneous Obligations of the Parties.
4.1 SMES's Rights and Obligations With Respect to Implementing St. Margaret's
Episcopal School Master Plan.
In carrying out the Master Plan, SMES shall comply with the following:
1. The Project shall conform to CITY's goal to manage growth through the
use of, among other things, comprehensive planning and design, project-wide continuity
of landscaping and architectural design, state-of-the-art development standards, and
planning concepts.
2. The traffic and circulation elements of the Development Plan will conform
to CITY's General Plan and will be designed to reduce the impact of the average daily
trips generated by the development of the Project on arterial roads and thoroughfares
adjacent to the Expansion Parcels by implementing the Mitigation Measures set forth in
the Mitigation Monitoring and Reporting Program for the Project.
3. As a religious organization, SMES is exempt from paying property taxes
on land dedicated to educational and religious uses. SMES does pay property taxes today
on the Expansion Parcels, which in the future, upon conversion to school uses, would be
subject to the property tax exemption. Also, the CITY would potentially lose sales tax
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revenue as a result of the Project's removal of commercial buildings from the Expansion
Parcels and development of the Expansion Parcels for non-commercial uses.
Notwithstanding the SMES exemption from property taxes by virtue of its status as a
religious organization, in exchange for CITY's agreement to enter into and perform its
obligations set forth in this Agreement, SMES has agreed that SMES shall make an
annual payment to CITY in an amount calculated as set forth in this Section 4.1.3,
providing substantial benefits to CITY and its residents:
In order to fully mitigate potential impacts of the lost property tax and
sales tax revenues associated with the Development Plan and provide financial benefits to
CITY and its residents, SMES shall pay to CITY each year an amount calculated as
follows for CITY's General Fund:
(1) $25,000 by September 30, 2011
(2) $50,000 by September 30, 2012
(3) $75,000 by September 30, 2013 and by September 30 of every
year thereafter
(4) The above payments shall be increased by 2% compounded
annually beginning be innin October 1, 2013
This is described further in Exhibit"D".
4. The Project will result in the expansion of the existing St. Margaret's
Episcopal School which will be of benefit to CITY and its residents by providing
additional educational resources to the community. As of this date, approximately 250
students (20% of the students enrolled at St. Margaret's Episcopal School) are residents
of San Juan Capistrano, and 700 students (57% of currently enrolled students) would
otherwise attend the Capistrano Valley Unified School District. Compliance with the
student enrollment cap established by Conditional Use Permit 02-14 ("Cap") shall be
determined annually, based on SMES's enrollment count as reported to the California
Department of Education. In order to encourage enrollment of high-need San Juan
Capistrano Students, SMES shall be entitled to enroll students who will be exempt from
the Cap, as detailed below and as described further in Exhibit"D":
(1) SMES may, in its sole discretion, enroll up to thirty (30) students who are
residents of San Juan Capistrano and are receiving financial aid of 80% or more
of tuition fees ("SJC80 Students"); and
(2) For each SJC80 Student in excess of twenty (20) (i.e. for the 21a` through
30`x' SJC80 Student enrolled), SMES may, in its sole discretion, enroll up to one
additional student ("Non-SJC80 Student") up to a maximum of ten (10) Non-
SJC80 Students.
(3) The SJC80 students (up to 30) and Non-SJC80 students (up to 10) allowed
by this Section 4.1.4 shall be exempt from the Cap established by Conditional Use
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Permit 02-14 and shall not be included in SMES's annual calculation of full time
equivalent students.
The traffic and other potential impacts associated with the increased number of students
authorized by this Section 4.1.4 are mitigated to a level below significant by the
Development Plan's removal of commercial buildings and commercial uses from the
Expansion Parcels.
5. The Project will result in dedication of an easement to CITY for a multi-
use trail connector along La Novia Avenue along the frontage of SMES upon CITY's
approval of a final trail alignment as part of CITY's General Plan.
6. The Project will result in a shared parking agreement with CITY providing
an additional parking lot to serve CITY's Cook Park and Trails that will provide
substantial benefits to CITY and its residents.
7. SMES will allow the Ortega Equestrian Center ("OEC") to continue
operating on the Project site under the terms of its existing lease with SMES until May
31, 2012, or any later date agreed upon in writing by both SMES and OEC, and will work
with OEC to accommodate relocation of the facilities in an orderly manner by May 31,
2012, or any later date agreed upon in writing by both SMES and OEC.
4.2 Future Development Approvals. To the maximum extent permitted by law CITY
agrees to expedite the processing of the Future Development Approvals, and to use its reasonable
good faith efforts to approve or adopt the Future Development Approvals in form and content
reasonably satisfactory to SMES; provided, however, that nothing in this Section 4.2 shall, or
shall be construed to, constitute a promise or commitment by CITY to approve the Future
Development Approvals or to approve the same with or without any particular requirements or
conditions, and provided further that prior to the date that the Future Development Approvals
may be so approved, CITY reserves its full legislative police power authority with respect
thereto consistent with its obligations set forth elsewhere in this Agreement. To the extent a
Future Development Approval is approved that pertains to the Property, the Future Development
Approval shall constitute for all purposes a Development Plan Approval.
5. Indemnification.
Except to the extent of the gross negligence or willful misconduct of CITY and its agents,
officers, contractors, attorneys, and employees (the "Indemnified Parties"), SMES, and with
respect to the portion of the Property transferred to them, the Development Transferee agree: to
indemnify, defend, and hold harmless the Indemnified Parties from and against each and every
claim, action, proceeding, cost, fee, legal cost, damage, award or liability of any nature arising
from alleged damages caused to third parties and alleging that CITY is liable therefor as a direct
or indirect result of CITY's approval of or performance under this Agreement. The duties of
SMES under this Section 5 are solely subject to and conditioned upon the Indemnified Parties'
written request to SMES to defend and/or indemnify CITY. Without in any way limiting the
provisions of this Section 5, the Parties hereto agree that this Section 5 shall be interpreted in
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accordance with the provisions of California Civil Code Section 2778 in effect as of the
Effective Date.
6. Relationship of Parties.
The contractual relationship between CITY and SMES is such that SMES is an
independent contractor and not an agent or employee of CITY. CITY and SMES hereby
renounce the existence of any form of joint venture or partnership between them, and agree that
nothing contained in this Agreement or in any document executed in connection with the
Property shall be construed as making CITY and SMES joint venturers or partners.
7. Amendment or Cancellation of Agreement.
This Agreement may be amended or canceled in whole or in part only by mutual consent
of the Parties in the manner provided for in Government Code Section 65868. No amendment or
modification of this Agreement or any provision hereof shall be effective unless set forth in
writing and signed by duly authorized representatives of each Party hereto. This provision shall
not limit any Party's remedies as provided by Section 9.
8. Periodic Review of Compliance with Aereement.
8.1 Periodic Review. CITY and SMES shall review this Agreement at least once
every 12-month period from the date this Agreement is executed, in September or such other
month as the City may notify SMES. CITY shall notify SMES in writing of the date for review
at least thirty (30) days prior thereto. Such periodic review shall be conducted in accordance
with Government Code Section 65865.1.
8.2 Good Faith Compliance. During each periodic review, SMES shall be required to
demonstrate good faith compliance with the terms of this Agreement, including, but not limited
to: its compliance with SMES's enrollment Cap, calculated in accordance with Section 4.1.4
above; and the annual payment required by Section 4.1.3 above. SMES agrees to furnish such
reasonable evidence of good faith compliance as CITY, in the exercise of its reasonable
discretion, may require. If requested by SMES, CITY agrees to provide to SMES a certificate
that SMES or its Development Transferee is in compliance with the terms of this Agreement,
provided SMES reimburses CITY for all reasonable and direct costs and fees incurred by CITY
with respect thereto.
8.3 Failure to Conduct Annual Review. The failure of CITY to conduct the annual
review shall not be a Default by SMES, nor shall any such failure alter, suspend, or terminate
any of the Parties' other rights and obligations hereunder. Further, SMES shall not be entitled
to any remedy for a failure by CITY to conduct this annual review.
8.4 Initiation of Review by City Council. In addition to the annual review, the City
Council may at any time initiate a review of this Agreement by giving written notice to SMES.
Within thirty (30) days following receipt of such notice, SMES shall submit evidence to the
City Council of SMES's good faith compliance with this Agreement and such review and
determination shall proceed in the same manner as is provided in Sections 8.1 and 8.2 and the
Development Agreement Legislation for the annual review. The City Council shall initiate its
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review pursuant to this Section 8.4 only if it has probable cause to believe CITY's general
health, safety, or welfare is at risk as a result of specific acts or failures to act by SMES.
8.5 Administration of Agreement. Any final decision by the CITY's staff concerning
the interpretation and administration of this Agreement and Development of the Property in
accordance herewith may be appealed by SMES to the City Council, provided that any such
appeal shall be filed with the City Clerk within ten (10) days after SMES receives written notice
that the staff decision is final. The City Council shall render, at a noticed public hearing, its
decision to affirm, reverse, or modify the staff decision within thirty (30) days after the appeal
is so filed.
8.6 Availability of Documents. If requested by SMES, CITY agrees to provide to
SMES copies of any documents, reports, or other items reviewed, accumulated, or prepared by
or for CITY in connection with any periodic compliance review by CITY, provided SMES
reimburses CITY for all reasonable and direct costs and fees incurred by CITY with respect
thereto. CITY shall respond to SMES's request on or before ten (10) business days have
elapsed from CITY's receipt of such request.
9. Events of Default: Remedies and Termination.
9.1 Defaults by SMES. If CITY determines on the basis of a preponderance of the
evidence that SMES has not complied in good faith with the terms and conditions of this
Agreement, CITY may, by written notice to SMES, specify the manner in which SMES has
failed to so comply and state the steps SMES must take to bring itself into compliance. If,
within sixty (60) days after the effective date of notice from CITY specifying the manner in
which SMES has failed to so comply, SMES does not commence all steps reasonably necessary
to bring itself into compliance as required and thereafter diligently pursue such steps to
completion, then SMES shall be deemed to be in default under the terms of this Agreement (a
"Default"). In such event, CITY may terminate this Agreement pursuant to Government Code
Section 65865.1 with respect to the Property. In material event of Default by SMES, except as
provided in Section 9.3, CITY's sole remedy for any breach of this section 9.1 shall be CITY's
right to terminate this Agreement.
9.2 Defaults by CITY. If SMES determines on the basis of a preponderance of the
evidence that CITY has not complied in good faith with the terms and conditions of this
Agreement, SMES may, by written notice to CITY, specify the manner in which CITY has
failed to so comply and state the steps CITY must take to bring itself into compliance. If,
within sixty (60) days after the effective date of notice from SMES specifying the manner in
which CITY has failed to so comply, CITY does not commence all steps reasonably necessary
to bring itself into compliance as required and thereafter diligently pursue such steps to
completion, then CITY shall be deemed to be in default under the terms of this Agreement (a
"Default"). In such event, SMES may terminate this Agreement with respect to the Property
and, in addition, may pursue any other remedy available at law or equity, including specific
performance as set forth in Section 9.3.
9.3 Specific Performance Remedy. Due to the size, nature, and scope of the
Development Plan, it will not be practical or possible to restore the Property to its pre-
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development condition once implementation of this Agreement has begun. After such
implementation, SMES may be foreclosed from other choices they may have had to utilize the
Property and provide for other benefits. SMES has invested significant time and resources and
performed extensive planning and processing of the Development Plan and Development Plan
Approval(s) in agreeing to the terms of this Agreement and will be investing even more
significant time and resources in implementing the Development Plan and Development Plan
Approval(s) in reliance upon the terms of this Agreement, and it is not possible to determine the
sum of money which would adequately compensate SMES for such efforts. For the above
reasons, CITY and SMES agree that damages would not be an adequate remedy if CITY fails to
carry out its obligations under this Agreement and that SMES shall have the right to seek and
obtain injunctive relief and specific performance as a remedy for any Default by CITY
hereunder. CITY and SMES further acknowledge that, if SMES fails to carry out its
obligations under this Agreement, CITY shall have the right to refuse to issue any permits or
other approvals which SMES otherwise would have been entitled to pursuant to this Agreement
that are related to and depend upon SMES's performance hereunder. Therefore, CITY's remedy
specific performance pursuant to Section 9.1, or else the remedy of terminating this Agreement
as to the portion of the Property as to which a material breach of Section 9.1 exists shall be
sufficient in most circumstances if SMES fails to carry out its obligations hereunder.
Notwithstanding the foregoing, if CITY issues a permit or other approval pursuant to this
Agreement in reliance (explicitly stated in writing) upon a specified condition being satisfied in
the future, and if SMES then fails to satisfy such condition, CITY shall be entitled to specific
performance for the sole purpose of causing SMES to satisfy such condition. CITY's right to
specific performance shall be limited to those circumstances set forth above, and CITY shall
have no right to seek specific performance to cause SMES to otherwise proceed with the
Development of the Property in any manner.
9.4 Institution of Legal Action. Except to the extent a non-Defaulting Party's rights
or remedies are limited by the express provisions set forth herein, SMES or CITY may institute
legal action to cure, correct, or remedy any Default, to enforce any covenants or agreements
herein, to enjoin any threatened or attempted violation hereof, to recover damages for any
Default, or to obtain any other remedies consistent with the purpose of this Agreement. Such
legal action shall be heard by a reference from the Orange County Superior Court.
9.5 Estoppel Certificates. Any Party or the holder or prospective holder of a
mortgage or deed of trust secured by an interest in any portion of the Property (a "holder") may
at any time during the Term of this Agreement deliver written notice to the other Party
requesting an estoppel certificate (the "Estoppel Certificate") stating:
(i) The Agreement is in full force and effect and is a binding obligation of the
Parties;
(ii) This Agreement has not been amended or modified either orally or in
writing or, if so amended, identifying the amendments;
(iii) No Default exists hereunder, nor would any Default exist with the passage
of time or the giving of notice, or both, or, if a Default or failure does exist, the nature
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thereof and the actions required to be taken by the non-performing Party to cure the
Default or prevent the same from occurring; and
(iv) Any other matter affecting the status of the rights and obligations of the
Parties hereunder as to which the requesting Party or the holder may inquire.
A Party receiving a request for an Estoppel Certificate shall provide a signed certificate to
the requesting Party or holder within thirty (30) days after receipt of the request. The City
Manager or any person designated by the City Manager may sign Estoppel Certificates on behalf
of CITY. The Headmaster of SMES may sign on behalf of SMES. An Estoppel Certificate may
be relied on by the holder and by Development Transferees.
In the event that one Party requests an Estoppel Certificate from another Party of Parties,
the requesting Party shall reimburse the other Party or Parties for all reasonable and direct costs
and fees incurred by such Party or Parties with respect thereto.
10. Waivers and Delays.
10.1 No Waiver. Failure by a Party to insist upon the strict performance of any of the
provisions of this Agreement by another Party, and failure by a Party to exercise its rights upon
a Default by another Party hereto, shall not constitute a waiver of such Party's right to demand
strict compliance by such other Party or Parties in the future for the same, similar, or any
different Default.
10.2 Third Parties. The Parties' respective performance obligations hereunder shall not
be delayed or excused because of any act or failure to act by a third person, except as provided
in Section 10.3.
10.3 Force Majeure. Notwithstanding any other provision set forth in this Agreement
to the contrary, SMES shall not be deemed to be in Default where failure or delay in
performance of any of its obligations under this Agreement is caused by floods, earthquakes,
other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties
beyond SMES's control, SMES's inability to obtain required permits or approvals from
governmental agencies with jurisdiction over the applicable portions of the Property and the
Project, government regulations (including, without limitation, local, state, and federal
environmental and natural resource regulations), voter initiative or referenda, moratoria
(including, without limitation, any "development moratorium" as that term is applied in
Government Code Section 66452.6), litigation, or any other causes that are without the fault
and beyond the reasonable control of SMES.
10.4 Extensions. The Term of this Agreement and the times for performance by SMES
or CITY of any of its obligations hereunder or pursuant to the Development Plan Approval(s)
shall be extended by the period of time that any of the events described in Section 10.3 exist
and/or prevent performance of such obligations. In addition, the Term shall be extended for
delays arising from the following events for a time equal to the duration of each delay which
occurs during the Term:
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(i) The period of time after the Effective Date during which litigation
challenging the validity or enforceability of this Agreement or related to the Development
Plan Approval(s) or having the actual effect of delaying implementation of the
Development Plan is pending, including litigation pending on the Effective Date. This
period shall include any time during which appeals may be filed or are pending; and
(ii) Any delay resulting from the acts or omissions of CITY or any other
governmental agency or public utility and beyond the reasonable control of SMES.
10.5 Notice of Delay. SMES shall give notice to CITY of any delay which SMES
believes to have occurred as a result of the occurrence of any of the events described in Section
10.3. For delays of six months or longer, this notice shall be given within a reasonable time
after SMES becomes aware that the delay has lasted six months or more. In no event, however,
shall notice of a delay of any length be given later than thirty days after the end of the delay or
thirty days before the end of the Term, whichever comes first.
11. Notices.
All notices required or provided for under this Agreement shall be in writing and
delivered in person or sent by certified mail, postage prepaid, return receipt requested.
Notices to CITY shall be addressed as follows:
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attention: City Manager
with a copy to:
Woodruff, Spradlin & Smart
555 Anton Boulevard, Suite 1200
Costa Mesa, CA 92626
Attention: Omar Sandoval, City Attorney
Notices to SMES shall be addressed as follows:
The Headmaster
Saint Margaret's of Scotland Episcopal School
31641 La Novia
San Juan Capistrano, CA 92675
with a copy to:
Gibson Dunn& Crutcher, LLP
3161 Michelson Drive
Irvine, CA 92612
Attention: Joseph P. Busch III, Esq.
_22_
Any notice given as required herein shall be deemed given only if in writing and upon
delivery personally or by independent courier service. A Party may change its address for
notices by giving notice in writing to the other Parties as required herein and thereafter notices
shall be addressed and transmitted to the new address.
CITY shall additionally provide written notice of any Default by SMES (including, as
applicable, any Development Transferee) and any act or omission by SMES (or such
Development Transferee) that would constitute a Default with the passage of time or giving of
notice or both, to the holder of any mortgage or deed of trust secured by all or any interest in the
Property which (i) delivers a written notice to CITY requesting such notices and (ii)provides
CITY with such holder's address(es) for notice purposes.
12, Attorneys' Fees.
If legal action is brought by one Party against another Party for breach of this Agreement,
including actions derivative from the performance of this Agreement, or to compel performance
under this Agreement, the prevailing Party shall be entitled to an award of its costs, including
reasonable attorneys' fees, and shall also be entitled to recover its contribution to the costs of the
referee referred to in Section 9.4 above as an item of damage and/or recoverable costs.
13. Recording.
This Agreement and any amendment or cancellation hereto shall be recorded against the
Property at no cost to CITY, in the Official Records of Orange County by the City Clerk within
the period required by Section 65868.5 of the Government Code. In addition, at such time that
SMES acquires fee title to any of the Expansion Parcels and such parcel(s) is (are) added to this
Agreement as provided in Section 3.5.4 this Agreement, this Agreement and any amendment or
cancellation hereto shall be recorded, at no cost to CITY, with respect to any such Expansion
Parcel(s). Notwithstanding the foregoing, in no event shall any failure or delay in recording this
Agreement and any amendment to this Agreement limit or restrict the validity or enforceability
of this Agreement.
14. Effect of Agreement on Title.
14.1 Effect on Title. The Parties agree that this Agreement shall not continue as an
encumbrance against the Property once the Agreement has terminated. Notwithstanding the
foregoing, the provisions of Sections 4.1.3 and 4.1.4 shall remain effective coterminous with
Conditional Use Permit 02-14.
14.2 Encumbrances and Lenders' Rights. The Parties hereby agree that this Agreement
shall not prevent or limit SMES (including without limitation any Development Transferee
hereunder), at any time or from time to time in any manner, at its or their sole discretion, from
encumbering the Property, the improvements thereon, or any portion thereof with any
mortgage, deed of trust, sale and leaseback arrangement, or other security device. CITY
acknowledges that the holder of any such security interest in all or any portion of the Property
may require certain clarifications, interpretations, or modifications to this Agreement or the
Development Plan and CITY agrees, upon request, from time to time, to meet with the
applicable Party and/or representatives of any such holder to negotiate in good faith any such
-23-
request for clarification, interpretation, or modification. CITY further agrees that it will not
unreasonably withhold its consent to any such requested clarification or interpretation to the
extent such clarification or interpretation is consistent with the intent and purpose of this
Agreement. A Default under this Agreement shall not defeat, render invalid, diminish, or
impair the lien of any such holder.
The mortgagee of a mortgage or beneficiary of a deed of trust or holder of any other
security interest in the Property or any portion thereof and its or their successors and assigns,
including without limitation the purchaser at a judicial or non-judicial foreclosure sale or a
person or entity which obtains title by deed-in-lieu of foreclosure (collectively, a "holder") shall
be entitled to receive a copy of any notice of Default (as defined in Section 9.1 hereof) delivered
to SMES as to whose portion of the Property such a Default exists and, as a pre-condition to the
institution of legal proceedings or termination proceedings, CITY shall deliver to all such holders
written notification of any Default by SMES in the performance of its obligations under this
Agreement which is not cured within sixty (60) days (the "Second Default Notice") and shall
allow the holder(s) an opportunity to cure such Defaults as set forth herein. The Second Notice
of Default shall specify in detail the alleged Default and the suggested means to cure it. After
receipt of the Second Default Notice, each such holder shall have the right, at its sole option,
within ninety (90) days to cure such Default or, if such Default cannot reasonably be cured
within that ninety (90) day period, to commence to cure such Default, in which case no Default
shall exist and CITY shall take no further action. Notwithstanding the foregoing, if such Default
shall be a Default which can only be remedied by such holder obtaining possession of the
applicable portion of the Property, and such holder seeks to obtain possession, such holder shall
have until ninety (90) days after the date obtaining such possession to cure or, if such Default
cannot reasonably be cured within such period, then to commence to cure such Default. Further,
a holder shall riot be required to cure any non-curable Default of SMES, and any such Default
shall be deemed cured if any lender obtains possession.
15. Severability of Terms.
If any tern, provision, covenant, or condition of this Agreement shall be determined
invalid, void, or unenforceable, the remainder of this Agreement shall not be affected thereby if
the tribunal finds that the invalidity was not a material part of consideration for the affected Party
or Parties. The covenants contained herein are mutual covenants. The covenants contained
herein constitute conditions to the concurrent or subsequent performance by each Party benefited
thereby of the covenants to be performed hereunder by such benefited Party.
16. Subsequent Amendment to Authorizing Statute.
This Agreement has been entered into in reliance upon the provisions of the Development
Agreement Legislation in effect as of the Effective Date. Accordingly, to the extent that
subsequent amendments to the Development Agreement Legislation would affect the provisions
of this Agreement, such amendments shall not be applicable to this Agreement unless necessary
for this Agreement to be enforceable or required by law or unless this Agreement is modified
pursuant to the provisions set forth in this Agreement and Government Code Section 65868 as in
effect on the Effective Date.
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17. Rules of Construction and Miscellaneous Terms.
17.1 Intemretation and Governing Law. The language in all parts of this Agreement
shall, in all cases, be construed as a whole and in accordance with its fair meaning. This
Agreement and any dispute arising hereunder shall be governed and interpreted in accordance
with the internal laws of the State of California, with regard to conflict of laws rules. The
Parties understand and agree that this Agreement is not intended to constitute, nor shall be
construed to constitute, an impermissible attempt to contract away the legislative and
governmental functions of CITY, and in particular, CITY's police powers. In this regard, the
Parties understand and agree that this Agreement is a current exercise of CITY's police powers
and except as expressly provided for herein this Agreement shall not be deemed to prevent the
future exercise by CITY of its lawful governmental powers over the Property.
17.2 Section Headings. All section headings and subheadings are inserted for
convenience only and shall not affect any construction or interpretation of this Agreement.
17.3 Gender. The singular includes the plural; the masculine gender includes the
feminine; "shall" is mandatory, "may" is permissive.
17.4 Time of Essence. Time is of the essence regarding each provision of this
Agreement as to which time is an element.
17.5 Recitals. All Recitals set forth herein are incorporated in this Agreement as
though fully set forth herein.
17.6 Entire Agreement. This Agreement constitutes the entire agreement between and
among the Parties with respect to the subject matter hereof, and this Agreement supersedes all
previous negotiations, discussions, and agreements between and among the Parties with respect
thereto.
18. Not for Benefit of Third Parties.
This Agreement and all provisions hereof are for the exclusive benefit of CITY and
SMES and their respective Development Transferees and shall not be construed to benefit or be
enforceable by any third party, excepting only to the extent of the limited rights provided to the
holders of security interests in all or a portion of the Property.
19. Cooperation in Event of Leaal Challenge.
CITY agrees to cooperate with SMES as may be needed in order to keep this Agreement
in full force and effect during the entire Term. In the event of any legal action instituted by a
third party or other governmental entity or official challenging the validity or enforceability of
any provision of this Agreement or any of the Development Plan Approval(s) (including without
limitation any Future Development Approvals after the same have been issued by CITY), the
Parties hereby agree to cooperate in defending such action and, in this regard, CITY shall not
allow its default to be taken in such legal action or otherwise compromise the legal action
without SMES's prior written consent. In the event of any such litigation, to the maximum
extent permitted by law this Agreement shall remain in full force and effect while such litigation,
-25-
including any appellate review, is pending. Notwithstanding the foregoing, SMES shall be
responsible for all costs, including but not limited to attorney's fees, costs, expert witness fees,
and the like, incurred with respect to any such litigation.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day
and year dated below.
Dated: , 2010 "CITY"
CITY OF SAN JUAN CAPISTRANO, a
municipal corporation
By:
Name: Dr. Londres Use
Title: Mayor
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
Dated: 2010 "SMES"
ST. MARGARET'S OF SCOTLAND
EPISCOPAL SCHOOL, a California non-profit
public benefit corporation
By:
Name:
Title:
By:
Name:
Title:
-27-
STATE OF CALIFORNIA )
ss
COUNTY OF ORANGE )
On before me,
a Notary Public, personally appeared
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 declare 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.
Notary Public
[SEAL]
STATE OF CALIFORNIA )
ss
COUNTY OF ORANGE )
On before me,
a Notary Public, personally appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be the
person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that
he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which the person(s)
acted, executed the instrument.
I declare 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.
Notary Public
[SEAL]
EXHIBIT "A"
LEGAL DESCRIPTION AND SITE PLAN OF THE SMES PROPERTY
That certain real property located in the City of San Juan Capistrano, County of Orange, State of California, described as follows:
CAMPUS PARCELS:
Location APN Acres Attached Map Reference
31641 La Novia 666-272-09 11.90 A
27461 Calle Arroyo 666-251-04 1.21 B
27481 Calle Arroyo 666-251-05 1.30 C
Calle Arroyo 666-251-06 3.07 D
Ortega Village Center 666-261-11 0.33 E
Ortega Village Center 666-261-10 0.36 F
Ortega Village Center 666-261-09 0.65 G
Total 18.82
EXPANSION PARCELS:
Location APN Acres Attached Map Reference
31732 Rancho Viejo Road 666-261-03 1.11 H
31658 Rancho Viejo Road 666-261-02 0.47 1
31648 Rancho Viejo Road 666-261-01 0.38 J
27252 Calle Arroyo 666-232-04 5.20 K
Calle Arroyo 666-123-01&2 0.91 L
Total 8.07
- 1 -
EXHIBIT "A"
Legal Description Properties
Campus Parcels: A through G
�.
Parcels:Expansion � ,
V .
�rfIRIL�IAIFfA _. IIAIAL11fAl IA!}AI}h ��- . . III �;��
.. ... •+r ��: ..,.1��"( '�.:,�Y's iii������I � ✓���_��;��
EXHIBIT "B"
NARRATIVE DESCRIPTION OF THE PROJECT
• Construction of a 41,777 SF Performing Arts Education Center and adjacent parking lot
reconfiguration, on the site of the current 7th and 8`h grade classrooms and Middle School
administration offices
• Construction of a 24,116 SF Middle School classroom building and adjacent pedestrian
area reconfiguration, on the site of two buildings in the Ortega Business Center
• To facilitate construction of the above, installation of new temporary modular classroom
buildings to house displaced 7`h and 8`h grade students
• Renovation of existing Church administrative building and adjacent courtyard
• Reconfiguration of parking space in the Ortega Business Center
• Construction of a new satellite parking facility at La Novia and Calle Arroyo
• Grant of easement over school property to facilitate City construction of a multi-use trail
along La Novia
• Conversion of existing `Sillers Hall' multi-purpose room to a dedicated all-school dining
facility
• Renovation, and possible 10,500 SF second-story expansion, of the Lower School
classroom buildings
• Renovation of the existing Campaigne Center building including a 1,000 SF addition
• Renovation of the second floor of the existing Gateway building
• Renovation and 3,000 SF expansion of the Chapel
• Development of 5 acres of land on Calle Arroyo, currently leased to the Ortega
Equestrian Center, as a multi-sport athletic field, with a 3,000 SF maintenance and
restroom building
• Establishment of calculation procedure for SMES enrollment cap of 1,194 full-time
equivalent students, to exclude the students that would otherwise exceed the cap as
described in Exhibit D.
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EXHIBIT "C"
DEVELOPMENT PLAN APPROVALS
1. Conditional Use Permit 02-14
2. General Plan Amendment 06-03
3. Rezone 06-06, 07-05
4. Architectural Control 07-22
5. St. Margaret's Episcopal School Master Plan
6. Development Agreement (Ordinance No.
7. Mitigated Negative Declaration
8. Future Development Approvals (as and when, and in the form and substance, adopted by
CITY).
- 2 -
EXHIBIT "D"
FURTHER DESCRIPTION OF ENROLLMENT CAP AND CITY FEE PAYMENTS
# of # of Enrollment Cap Total
SJC80 Non- Students
students SJC80 Enrolled
students
1,194 Full-Time 1,194
Terms of Conditional Use Permit 02-14 0 0 Equivalent
Students
Terms of this Agreement — Enrollment
Cap
The first twenty (20) enrolled SJC80 0 - 20 0 1,194 Full-Time Up to 1,214
students shall be excluded from the Equivalent
enrollment cap Students Plus up
to 20 SJC80
Students*
Up to an additional ten (10) enrolled SJC80 21-30 1-10 1,194 Full-Time Up to 1,234
students shall be excluded from the Equivalent
enrollment cap. For each such additional Students Plus up
SJC80 student, one Non-SJC80 student may to 30 SJC80
be enrolled and excluded from the Students and up
enrollment cap to 10 Non-SJC80
Students*
Annual Fee to
Terms of this Agreement — Annual City City
Fee
September 30, 2011 $25,000
September 30, 2012 $50,000
September 30, 2013 $75,000
September 30, 2014 and every year $75,000 + 2%
thereafter Compounded
annually
* The additional SJ80 students (up to 30) and Non-SJ80 students (up to 10) allowed pursuant to
Section 4.1.4 of the Development Agreement shall be exempt from the Cap established by
Conditional Use Permit 02-14 and shall not be included in SMES's annual calculation of full
time equivalent students.
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TABLE OF CONTENTS
Page
1. DEFINITIONS...................................................................................................................4
1.1 Authorizing Ordinance...........................................................................................4
1.2 Campus Parcels......................................................................................................4
1.3 CEQA..................................................................................................................... 5
1.4 CITY...................................................................................................................... 5
1.5 City Council...........................................................................................................5
1.6 Default....................................................................................................................5
1.7 Develop or Development or Developing............................................................... 5
1.8 Developer............................................................................................................... 5
1.9 Development Agreement Legislation.................................................................... 5
1.10 Development Exactions......................................................................................... 5
1.11 Development Plan.................................................................................................. 5
1.12 Development Plan Approval(s)..............................................................................6
1.13 Development Transferee........................................................................................6
1.14 Effective Date ........................................................................................................6
1.15 Expansion Parcels..................................................................................................6
1.16 Future Development Approvals.............................................................................6
1.17 On-Site Improvements...........................................................................................6
1.18 [Reserved]..............................................................................................................6
1.19 Party or Parties.......................................................................................................6
1.20 Property..................................................................................................................6
1.21 Planning Commission............................................................................................6
1.22 Project....................................................................................................................7
1.23 Property..................................................................................................................7
1.24 St. Margaret's Episcopal School Master Plan........................................................ 7
1.25 Term....................................................................................................................... 7
2. GENERAL PROVISIONS ................................................................................................7
2.1 Binding Covenants.................................................................................................7
2.2 Interest of SMES....................................................................................................7
2.3 Term.......................................................................................................................7
2.4 Termination............................................................................................................ 8
2.5 Transfers and Assignments.................................................................................... 8
3. DEVELOPMENT PROVISIONS .....................................................................................9
3.1 Vesting...................................................................................................................9
3.2 Reserved Authority.............................................................................................. 10
3.3 Further Assurances to SMES Regarding Exercise of Reserved Authority.......... 12
3.4 Vested Right......................................................................................................... 12
3.5 Amendment of Development Agreement............................................................ 13
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Page
3.6 Future Amendments to Development Plan.......................................................... 14
3.7 Future Development Approvals........................................................................... 15
4. MISCELLANEOUS OBLIGATIONS OF THE PARTIES ............................................ 15
4.1 SMES's Rights and Obligations With Respect to Implementing St. Margaret's
Episcopal School Master Plan ............................................................................. 15
4.2 Future Development Approvals................................................................................. 17
5. INDEMNIFICATION...................................................................................................... 17
6. RELATIONSHIP OF PARTIES...................................................................................... 18
7. AMENDMENT OR CANCELLATION OF AGREEMENT ......................................... 18
8. PERIODIC REVIEW OF COMPLIANCE WITH AGREEMENT................................ 18
8.1 Periodic Review................................................................................................... 18
8.2 Good Faith Compliance....................................................................................... 18
8.3 Failure to Conduct Annual Review...................................................................... 18
8.4 Initiation of Review by City Council................................................................... 18
8.5 Administration of Agreement.............................................................................. 19
8.6 Availability of Documents................................................................................... 19
9. EVENTS OF DEFAULT: REMEDIES AND TERMINATION.................................... 19
9.1 Defaults by SMES................................................................................................ 19
9.2 Defaults by CITY................................................................................................. 19
9.3 Specific Performance Remedy............................................................................. 19
9.4 Institution of Legal Action...................................................................................20
9.5 Estoppel Certificates............................................................................................20
10. WAIVERS AND DELAYS.............................................................................................21
10.1 No Waiver............................................................................................................21
10.2 Third Parties.........................................................................................................21
10.3 Force Majeure......................................................................................................21
10.4 Extensions............................................................................................................21
10.5 Notice of Delay....................................................................................................22
11. NOTICES.........................................................................................................................22
12. ATTORNEYS'FEES.......................................................................................................23
13. RECORDING..................................................................................................................23
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Page
14. EFFECT OF AGREEMENT ON TITLE ........................................................................24
14.1 Effect on Title......................................................................................................24
14.2 Encumbrances and Lenders'Rights.....................................................................24
15. SEVERABILITY OF TERMS ........................................................................................24
16. SUBSEQUENT AMENDMENT TO AUTHORIZING STATUTE...............................24
17. RULES OF CONSTRUCTION AND MISCELLANEOUS TERMS.............................25
17.1 Interpretation and Governing Law.......................................................................25
17.2 Section Headings .................................................................................................25
17.3 Gender..................................................................................................................25
17.4 Time of Essence...................................................................................................25
17.5 Recitals.................................................................................................................25
17.6 Entire Agreement.................................................................................................25
18. NOT FOR BENEFIT OF THIRD PARTIES...................................................................26
19. COOPERATION IN EVENT OF LEGAL CHALLENGE.............................................26
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Recorded at the request of and mail to: EXHIBIT B
City Clerk
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano,CA 92675
(Space Above This Line for Recorder's Office Use Only)
(Exempt from Recording Fee per Gov.Code§§6103 and 27383)
APN: 666-272-09, 666-251-04, 666-251-05, 666-251-06, 666-261-11, 666-261-10, 666-261-09, 666-261-03, 666-
261-02, 666-261-01, 666-232-04, 666-123-01&2
COVENANT AND AGREEMENT
REGARDING MITIGATION OF FINANCIAL IMPACTS AND CALCULATION OF STUDENT
ENROLLMENT CAP
RECITALS
A. ST. MARGARET OF SCOTLAND EPISCOPAL SCHOOL ("Owner") hereby certifies that
it is the owner of real property located in the City of San Juan Capistrano, State of California,
Assessor's Parcel Numbers , which is legally described as follows (and more
particularly described in the attached Exhibit "A") ("Property"):
[SEE ATTACHED EXHIBIT A]
B. Owner and City have entered into the Development Agreement recorded concurrently
herewith and adopted on 2010 pursuant to City Council Ordinance No.
(St. Margaret's Episcopal School Expansion Project) securing the issuance of various land use
entitlements allowing the Owner to expand its existing educational institution on said Property
consistent with the Development Plan described therein.
C. This Covenant and Agreement is executed and recorded for the purpose of
memorializing the provisions of Section 4.1.3 and 4.1.4 of the Development Agreement
applicable to the Property that survive termination of the Development Agreement, and
providing constructive notice of the provisions of Section 4.1.3 and 4. of the Development
Agreement to any successors or assignees of Owner's fee interest therein. Any capitalized
terms not defined herein shall have the meanings ascribed to such terms in the Development
Agreement.
COVENANTS
1. The Owner hereby agrees and covenants with the City of San Juan Capistrano ("City")
that so long as the above legally-described property shall be held for use pursuant to
Conditional Use Permit 02-14 as an educational institution exempt from taxation it shall fully
mitigate potential financial impacts of lost property tax and sales tax revenues to the City of
San Juan Capistrano and its residents associated with the Development Plan by making the
following payments to the City for its general fund each year:
672404, 1 Exhibit B
945080.1
(1) $25,000 by September 30, 2011
(2) $50,000 by September 30, 2012
(3) $75,000 by September 30, 2013 and by September 30 of every year thereafter
(4) The above payments in item (3) shall be increased by 2% compounded annually
beginning October 1, 2013.
2. The City hereby agrees and covenants with the Owner that compliance with the student
enrollment cap established by Conditional Use Permit 02-14 ("Cap") shall be determined
annually, based on Owner's enrollment count as reported to the Department of Education. In
order to encourage enrollment of high-need San Juan Capistrano students, Owner shall be
entitled to enroll students who will be exempt from the Cap, as detailed below:
(1) Owner may, in its sole discretion, enroll up to thirty (30) students who are
residents of San Juan Capistrano and are receiving financial aid of 80% or more
of tuition fees ("SJC80 Students"); and
(2) For each SJC80 Student in excess of twenty (20) (i.e. for the 21st through
30th SJC80 Student enrolled), Owner may, in its sole discretion, enroll up to one
additional student ("Non-SJC80 Student") up to a maximum of ten (10) Non-
SJC80 Students.
(3) The SJC80 students (up to 30) and Non-SJC80 students (up to 10)
allowed by this Section 4.1.4 shall be exempt from the Cap established by
Conditional Use Permit 02-14 and shall not be included in Owner's annual
calculation of full time equivalent students.
The traffic and other potential impacts associated with the increased number of students
authorized by this Covenant and Agreement are mitigated to a level below significant by the
Development Plan.
3. This Covenant and Agreement shall run with all of the above-described land and shall
be binding upon and inure to the benefit of the City and the Owner, and all future owners,
encumbracers, their successors, heirs or assignees and shall continue in effect until released
by the authority of the City Council of the City upon evidence that this Covenant and
Agreement is no longer required.
IN WITNESS WHEREOF, the Parties hereto have executed this Covenant and
Agreement on the day and year dated below.
Dated: , 2010 "CITY"
CITY OF SAN JUAN CAPISTRANO, a municipal
corporation
By:
Name:
Title: Mayor
ATTEST:
2
672404
945080.1
Maria Morris, City Clerk
APPROVED AS TO FORM:
Omar Sandoval, City Attorney
Dated: , 2010 "OWNER"
ST. MARGARET'S OF SCOTLAND EPISCOPAL
SCHOOL, a California non-profit public benefit
corporation
By:
Name:
Title:
By:
Name:
Title:
Dated this day of
3
672404.1
945080.1
EXHIBIT "A"
LEGAL DESCRIPTION OF THE SMES PROPERTY
That certain real property located in the City of San Juan Capistrano, County of Orange, State
of California, described as follows:
CAMPUS PARCELS:
Location APN Acres
31641 La Novia 666-272-09 11.90
27461 Calle Arroyo 666-251-04 1.21
27481 Calle Arroyo 666-251-05 1.30
Calle Arroyo 666-251-06 3.07
Ortega Village Center 666-261-11 0.33
Ortega Village Center 666-261-10 0.36
Ortega Village Center 666-261-09 0.65
Total 18.82
EXPANSION PARCELS:
Location APN Acres
31732 Rancho Viejo Road 666-261-03 1.11
31658 Rancho Viejo Road 666-261-02 0.47
31648 Rancho Viejo Road 666-261-01 0.38
27252 Calle Arroyo 666-232-04 5.20
Calle Arroyo 666-123-01&2 0.91
Total 8.07
4
672404.1
94`080.1
STATE OF CALIFORNIA )
COUNTY OF ORANGE )
On before me, a 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 declare 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.
Notary Public
5
672404 1
945080.1
Christy Jakl
From: Ayako Rauterkus
Sent: Tuesday, March 23, 2010 11:45 AM
To: Christy Jakl
Cc: Bill Ramsey
Subject: RE: St. Margaret's Development Agreement
Hi Christy:
We are waiting for St. Margaret to sign and notarize the agreement. I will forward the agreement as soon as it's ready!
Thank you,
Ayako Rauterkus
Community Development Department
arauterkus@sanivancapistrano.org
949.443.6325
Fax: 949.661.5451
From: Christy Jakl
Sent: Tuesday, March 23, 2010 11:25 AM
To: Ayako Rauterkus
Cc: Bill Ramsey
Subject: St. Margaret's Development Agreement
Good Morning,
I wanted to find out the progress of the Development Agreement for St. Margaret's approved at the
3/2/2010 City Council Meeting.
Once all the signatures and notaries are collected, feel free to forward the agreement to our office for
recording and tracking. If you wish to handle everything through your office that's fine as well;
please provide the originally recorded document with all back up documents to our office for filing.
Please let me know if you have any questions. Thanks! O
Sincerely,
Christi Jakl
Deputy City Clerk
City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
(949) 443-6310 1 (949) 493-10S3 fax
1
. din
32400 PASEO ADELANTO MEMBERS OF THE CITY COUNCIL
SAN JUAN CAPISTRANO,CA 92675
(949)493.1171 ,/y LAURA FREES
(949)4931053 FAX • fy IAOAIAAAIFI LAURA FREESE
ISIII0SHI 1861 THOMAS W.HRIBAR
wwwsanjuancapistrano.org 1776 MARK NIELSEN
• • DR.LONDRES USO
April 1, 2010
Clerk-Recorder's Office
County of Orange
P.O. Box 238
Santa Ana, California 92701
Re: Document for Recording — Development Agreement (St. Margaret's Episcopal
School Expansion Project)
The noted document is enclosed for recording:
When placed of record, please return the recorded documents to this office.
Thank you for your assistance.
Very truly yours,
Christy Jakl
Deputy City Clerk
San Juan Capistrano: Preserving the Past to Enhance the Future
�, Printed on 10%recycled paper
Today's Date: March 29, 2010 Transmittal Routing
(Check All That Apply)
® City Attorney
❑ City Manager
® City Clerk
CONTRACT TRANSMITTAL
CIP No. (if any):
Project Manager's Last Name: Ramsey Phone Extension: 6334
Council or CRA Meeting Date (if applicable): March 16, 2010
APPROVING AUTHORITY: (Check One)
❑ Mayor
❑ CRA Chair
❑ City Manager
Provide (1) executed original contract for each signing party, including the City. If the agreement is to be
recorded —only (1) original will be recorded with certified copies going to other parties.
Please provide the mailing address of any party to receive an agreement — unless the mailing address is
included within the body of the agreement:
Names Street city St Zi
OTHER INSTRUCTIONS:
Please retur o Clerk's office once Omar's signed. Thanks.
'n Sor- vs .
n
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Form Date:01-2004 D -7