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15-0602_SOUTH COAST INVESTOR_F15_Agenda Report_Supplementary6/2/2015 F15 City of San Juan Capistrano Supplementary Agenda Report TO: Honorable Mayor and Members of the City Council FROM: Charles View, Development Services DirectoA^ Prepared by; Sergio Klotz, Assistant Development Services Director DATE: June 2, 2015 SUBJECT: Consideration of Assignment and Assumption of Development Agreement for the Plaza Banderas Hotel and Mixed Use Project (South Coast Investor II, LLC, a Subsidiary of Rivendell Land Company, Inc.) RECOMMENDATION: By motion, adopt a Resolution approving the assignment and assumption of the Stroscher G3, LLC interest in the Development Agreement, for the Plaza Banderas Hotel and Mixed Use Project to South Coast Investor II, LLC a subsidiary of Rivendell Land Company, Inc. SITUATION: The Recommended Action is to approve the assignment and assumption of Stroscher G3, LLC interest in the Development Agreement, for the Plaza Banderas Hotel and Mixed Use Project to South Coast Investor II, LLC a subsidiary of Rivendell Land Company, Inc. While the recommended action does not modify the content of the Development Agreement, a copy of the Development Agreement is attached as an information item for City Council review. FISCAL IMPACT: Not applicable. ENVIRONMENTAL IMPACT: Not applicable. ATTACHMENTfS): Attachment 1 - Plaza Banderas Hotel and Mixed Use Project Development Agreement RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City Clerk City of Sim Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Recorded in Official Records, Orange County Tom Daly. Clerk-Recorder niiiiji NO FEE 2011000382839 11:21 am 08/04/11 62 417A12 194 0.00 0.00 0.00 0.00 579.00 0.00 0.00 0.00 {Sivdf:t Abuvc This Line for Recorder's Office Use Only) {L\enipt from Recording Fee per Gov. Code §§ (j103 and 27383) DE VELOPMENT AGREEMENT (PLAZA BANDERAS HOTEL AND MIXED USE PROJECT) by and between CITY OF SAN JUAN CAPISTRANO and STROSCHER G3, LLC Effective August 3. 2011 (Ordinance No. 988 adopted July 5, 2011) ATTACHMENT 1 DEVELOPMENT AGREEMENT (PLAZA BANDERAS HOTEL AND MIXED USE PROJECT) This DEVELOPMENT AGREEMENT (PLAZA BANDERAS HOTEL AND MIXED USE PROJECT) (ihe "Agrccmcnl") is dated for reference purposes only as of the S^^day of Jul v. 2011, 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 STROSCHER 03, LLC, a California limited liability company ("STROSCHER"), pursuant to the authority of Sections 65864 tlirough 65869.5 of the California Government Code (the "Development Agreement Legislation") and Article XI, Section 2, of the California Constitution. CITY and STROSCHER 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 ivith persons having legal or equitable interests in real property for the development of such property in order to, among other things: ensure high quality de\'clopment in accordance with comprehensive plans; provide ceitainty in the approval of developmenl 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 tlie development of public infrastructure and amenities to support the development of new housing and commercial projects. C. STROSCHER is the fee owner of that certain real property consisting of 3.18 acres of land located at the corner of Ortega Highway and El Camino Real 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. The Property consists of 3.18 acres, with a three-story, 124-room hotel, consisting of 76,363 square feet ("Hotel") on approximately 2 acres; 10,169 square feet two story office/retail building consisting of 6.467 square feel of retail on the first floor ("Retail Component") and 3,702 square feet of private office on tlie second floor (the "Private Office Space") ; 6.095 square feet for a restaurant ("Restaurant") and 190 parking .spaces (the Hotel, Retail Component, the Private Office Space, Restaurant and parking spaces are collectively, the "Project"). E. In connection with approval of the Project, STROSCHER applied for. and CITY approved, General Plan Amendment 10-001; Rezone 10-001: Architectural Control 10-002; Grading Plan Modification 10-001; Tree Removal Permit 10-003; Floodplain Land Use Permit 10-001; and Tentative Parcel Map 10-001 (collectively, the "Development Plan .A-pprovais"), in accordance with -1- the provisions of this Agreement, and other applicable regulations of the CITY and other governmental agencies having Jurisdiction over the Property and the '-Project" as defined in Section 1.24 below. F. STROSCHER has applied for, and CITY has approved, this Agreement in order to create a beneficial development project and a physical environment that will confonn to and complement the goals of CITY, be sensitive to human needs and -wilues, 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 CTTY's goal to manage growah through the use of, among other things, comprehensive plamiing and design, project-wide continuity of landscaping and architectural design, state-of-tlie-art development standards, and planning concepts. 2. The traffic and circulation elements of the Development Plan wall 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 ("MMRP") for the Project. 3. Dedication to CITY of an easement interest in the air space over a portion of the Property, to be used by the City as a parking lot or parking facility ("Parking Lot Air Space Parcel"), to increase the number of parking spaces available for visitors to the Mission San Juan Capistrano. J he Parking Lot Air Space Parcel shall not eliminate any of the Project's parking spaces and improvements to this air space shall not disrupt Development or operation of the Project. A depiction of the Parking Lot Air Space Parcel is attached hereto at Exhibit "B" and made a part hereof. 4. Development of the Project will generate significant increases in revenue to the City, through Project generation of Transit Occupancy Tax revenues (San Juan Municipal Code ("SJMC") Section 3-3.601 et seq.), sales tax revenues and increased property tax revenues. G. The following actions have been taken with respect to this Agreement and the Project: 1. On or about October 5, 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 .\greement, were adequately mitigated and adopted an Environmental Impact Report; 2. On or about Scptcmhcr 14. 2010. following three duly noticed and conducted public hearings, the Planning Commission of CITY took action on the Project; 3. On or about October 5, 2010, ihe City Council of CITY approved the Development Plan Approvals; 4. On or about June 30, 2011, after a duly noticed and conducted public hearing, the City Council of CITY determined that the provisions of this Agreement were consistent with the General Plan of CJ l Y; 5. On or about June 30, 2011, pursuant to CEQA, the CII Y Council of CITY found and determined that the previously certified Environmental Impact Report for the Project adequately describes the Agreement's environmental setting, impacts and alternatives and mitigation measures related to each significant impact; and 5. On or about June 30, 201 1, after a duly noticed and conducted public hearing, the City Council of CITY introduced Ordinance No. 988 approving and authorizing the execution of This Agreement and on _July 5, 2011, 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. H. In consideration of the substantial public improvements and benefits to be provided by STROSCHER and the Project, and in order to strengthen the public planning process and provide significant educational and economic benefits to the City of San .luan community, by this Agreement CITY intends to provide to STROSCHER the assm-ance that it can proceed with Development of tlie Projcet for the Term of this Agreement pursuant to the tenns and conditions of this Agreement and in accordance with the ClTY'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, STROSCHER 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 malce 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 S TROSCHHR agree thai 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 infonnation concerning the details of each component is available, and that this Agreement should express!}' allow for such contemplated additional agreements, operating memoranda, and modifications to this Agreement. K. Project Mitigation Measure MM 4.11.201b and Project Condition of Approval No. 48 require STROSCHER to construct a loop system to run from a POC in the 350C system at the intersection of EI Horno and the 1-5 Freeway ("El Horno Section") to a connection to the 350C system at the intersection of Ortega Highway and Avenida Los Cerritos ("Ortega Section"). The "Oi'tega Section" to which the El Homo Section is to connect includes the water line from a point 200 foot east of the intersection of Camino Capistrano and Ortega Hwy., then continuing easterly on Ortega Hwy. to the intersection of Ortega Highway and Avenida Los Cerritos. Compliance of these conditions may be resolved as Ibllows: 1. During the future reconstruction of the Ortega Bridge over the 1-5, CITY has requested Caltrans to provide for the water interconnect required to create the Ortega Section loop. Should the El Horno Section provide sufficient fire flow as determined by the fire marshall, STROSCHER shall not be required to construct the Ortega Section. Prior to tlie time the Ortega Section is to be constructed, STROSCHER and CITY "may reconsider STROSCHER's fair shai-e for the cost of construction and/or the Parties may enter into a reimbursement agreement to specify STROSCHER's fair share and reimbursement should new development be proposed, which would benefit from the Ortega Section construction. City will waive this requirement in tlic event that grant funding becomes available to fund die construction of the Ortega Section. 2. STROSCHER shall construct the El Horno Section to provide sufficient fire flow to the Property as determined by the fire marshall. STROSCHER and CITY may reconsider STROSCHER's fair share for the cost of construction should new development be proposed, which would benefit from the El Horno Section construction. The Parties may fuither enter into a reimbursement agreement to specify STROSCHER's fair share and reimbufsement should new development be proposed, which would benefit from the El Horno Section construction. City will waive this requirement in the event that grant funding becomes available to fund the construction of the Ei Horno Section. 3. Subject to exercising its legislative discretion, the CITY shall consider the creation of a utility district to fund the undergrounding of power lines along El Camino Real ("Undergrounding of Power Lines"). L. CITY agrees, subject to exercising its legislative discretion, to assist STROSCHER in its attempts to have Caltrans reconstruct the entryway to the Project, which may be required due to the future relocation and expansion of Ortega Highway by Caltrans. CITY's assistance to STROSCHER shall not include the provision of any financial assistance, unless CITY, in its sole discretion, determines to provide financial assistance. M. The Sti-Qscher Family previously conveyed to the County of Orange rights-of-way which were to be used in the construction of the Ortega Highway. Ultimately, the City succeeded to the interest of the County of Orange, and present!)' owns the rights-of-wa>'. which no longer are needed for future improvement of the Ortega Highway ("Excess Ortega Rights-of-Way"). The Excess Ortega Rights-of-Way ai'c depicted on Exhibit "C" attached hereto and made a part hereof. AGREEMENT NOW, T1IERJ3F0RE, 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, .4„ and in consideration of the foregoing recitals of fact, all of which ai'c 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. 988 approving this Agreement. 1-2 CEQA. "CEQA" has the meaning ascribed to that term in Recital F.l of this Agreement. 1.3 CITY- "C]XY" means the City of San Juan Capistrano, a California municipal corporation, duly organized and existing under the Constitution and laws of the Stale of California, and all of its officials, employees, agencies, and departments. 1.4 Cilv Council. "City Council" means the duly elected and constituted city council of CITY. 1.5 Default. "Default" has the meaning ascribed in Section 9.1 or 9.2 of this Agreement, as applicable. 1.6 Develop. Development or Developing. "Develop," "Development" or "Developing" means the improvement and use of the Property, as the term "Development" is defined in California Government Code Section 65927, for purposes consistent with the Project and this Agreement, 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. 1-7 Developer. Developer means Stroscher G3, LLC, 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. 1.8 Development Agreement Legislation. "Development Agreement Legislation" means Sections 65864 tlirough 65869.5 of the California Government Code as it exists on the Effective Date. 1.9 Deveiopmcnt Exactions. "Development Exactions" means any requirement of CITY in connection with the Existing or Subsequent Land Use Regulations or Development Plan Approvals, for the dedication of land (including without limitation through the encumbrance of land with an easement or use restriction), 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. 1.10 Development Impact Fees. "Development Impact Fees" shall mean those fees established and adopted by CITY with respect to development and its impacts pursuant to applicable governmental requirements, including Section 66000 et seq., of the California Government Code, including impacts fees, linlcage fees, exactions, assessments or fair share charges or other similar impact fees or charges imposed on or in connection with new development by the CITY. Development Impact Fees do not mean or include Processing Fees. The Development Impact Fees are the only Deveiopmcnt Impact Fees that the City may impose or levy on the Project. 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 *'D" to this Agreement, the Development Plan Approvals set forth in Exhibit "E" to this Agreement, and the express provisions set forth in this Agreement that define or describe the Project. The Future Development Approvals automatically shall become a part of the Development Plan and included within the scope of STROSCHER'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 Develomnent Plan Approval(s). "Development Plan Approval(s)" means the approvals of the City Council described in Exhibit "E" hereto insofar as the same relate to the Property and the Development Plan, including those amendments to this Agreement made in accordance with Section 3.8 hereof, those amendments to the Development Plan Approval(s) made in accordance with Section 3.9 hereof, and those Future Development Approvals made in accordance with Section 3.6 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 Discretionary Action(s) or Discretionary ApprovaKs"). "Discretionary Action(s)" or "Discretionary Approval(s)" means an action which requires the exercise of judgment, deliberation or discretion on the part of the CITY including any board, agency, commission or department and any officer of employee thereof, in the process of approving or disapproving a particular activity, as distinguished from an activity which is defined herein as a Ministerial Permit or Ministerial Approval. 1.15 Effective Date. "Effective Date" means the date the Authorizing Ordinance becomes effective. 1.16 Existing Land Use Regulations. "Existing Land Use Regulations" means all ordinances, laws, resolutions, codes, rules, regulations, policies, requirements, guidelines or other action of CITY, including but not limited to the CITY's General Plan Municipal Code and Zoning -6- Code and including all Development Impact Fees, which affect, govern or apply to the Development and use of the Property, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, the maximum height and size of proposed buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the Development of the Property, subject to the terms of this Agreement, whether adopted by the City Council or the voters in an initiative, which are in effect on the Effective Date, pursuant to California Government Code Section 65866. 1.17 Future Development Approvals. "Future Development Approvals" means those entitlements and approvals that are: (a) made in accordance with Section 3,6 hereof; and (b) requested by STROSCHER in order to authorize the Development to occur upon the Properly 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 pennits, and occupancy permits that are required as a condition to STROSCFTER'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 "D ". 1.18 Ministerial Approval(s) or Ministerial Actfs). "Ministerial Approval(s)" or "Ministerial Act(s)" means a permit approval or clearance, conformance with the Existing Land Use Regulations, including, without limitation, conformance maps for tentative tract maps, determinations of compliance with the Project Conditions of Approval of the Existing Project Approvals, site plans, grading plans, improvement plans, building plans and specifications, and ministerial issuance of one or more final maps, zoning clearances, grading permits, improvement permits, wall permits, building permits, lot line adjustments, encroachment permits, temporary use permits, certificates of use and occupancy, and approvals and entitlements and related matters as necessary for the completion of the Development of the Property as distinguished from an activity which is included in the definition of Discretionary Action or Discretionary Approval. 1.19 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. 1.20 Owner. "Owner" means STROSCITER. 1.21 Party or Parties. "Party" means either CITY or STROSCHER, as the context dictates, and "Parties" means CflT and STROSCHER. 1.22 Planning Commission. "Planning Commission" means the duly appointed and constituted planning commission of CITY. 1.23 Processing Fees. "Processing Fees" means all fees and charges of every kind and nature imposed by City to cover the estimated actual costs to City of processing applications for Future Development Approvals. 1-24 Project. "Project" means the Development and Approvals summarized in Recital E, the planning elements of which are more specifically described in Exhibit "E" hereto. -7- 1.25 Property. "Property" means the Property referred to in Recital C and more particularly described in Exhibit "A " to this Agreement. 1.26 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 STROSCHER. As of the date this Agreement is being executed by the Parties, STROSCHER represents that STROSCHER is the fee owner of that certain real property consisting of 3.18 acres of land located at the northwest corner of Ortega Highway and EI Camino Real in the City of San Juan Capistrano, County of Orange, Slate of Califomia, that is more particularly described and depicted in Exhibit "A " attached hereto and made a part hereof (the "Property"). 2.3 Term. In addition 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 fifth (5^'^) anniversary of the Effective Date, subject to the termination provisions set forth herein; provided, however, that so long as STROSCHER is not in Default of this Agreement and the Agreement has not been otherwise terminated, STROSCHER may request CITY to extend the Term for up to three (3) one-year extensions of the Term. City shall have the discretion as to whether to approve or deny any such extension request(s) made by STROSCHER. STROSCHER's request(s) to extend the Term shall be submitted not more than one hundred eighty (180) days and no less than sixty (60) days before the end of the Term. Pursuant to California Government Code Sections 65863.9 and 66452.6(a), the expiration date of all Development Plan Approvals shall be extended for the greater of the Term of this Agreement, in which case no such extension application need be filed, or such lime approved in accordance with state law or the Plxisting Land Use Regulations. The Parties agree that phased final subdivision maps may be processed and recorded. 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 fmal judgment or issuance of a final order directed to CITY invalidating this Agreement. -8- The termination of this Agreement in its entirely or with respect to a particular lot(s) or parcel(s) shall not affect any riglit or duty of STROSCHER ai'ising 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 ioi(s) or parcel(s), and notwithstanding any other provision set forth herein, upon request by STROSCHER, 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 Propeily or applicable portion thereof. 2.5 Transfers and Assignments. 2.5.1 STROSCHER ("Owner") shall not assign all or any part of this Agreement without the prior WTitten approval of the CITY. Such written approval by the CITY shall not be unreasonably withheld, provided that: (a) if Owner's proposed assignee is an entity, such entity shall be legally formed and qualified to conduct business in the State of California; (b) Owner shall have delivered evidence to CITY that Owner's proposed assignee has the ability to comply with the Agreement; (c) Owner and its/their assignee execute an assignment and assumption agreement pursuant to which the assignee expressly assumes all of Owner's obligations under the Agreement, and (d) CITY shall bear no expenses in connection with such assignment. Notwithstanding any other provision of this Agreement, Owner 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 Owner's control. 3, Development Provisions. 3.1 Vesting. 3.1.1 Project. CITY covenants STROSCHER has and shall have the right to Develop the Project on the Property consistent with the Development Plan and tlie 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 deveiopmcnt. 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 fortJi in the Deveiopmcnt Plan and Development Plan Approval(s), regardless of any future enactment, whether by initiative or otherwise, STROSCHER shall have the vested right to Develop the various components of the Project in such order, at such rate, and at such times as STROSCHER deems appropriate within the exercise of its subjective business judgment. Specifically, CITY agrees that STROSCHER 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 ainendmcnt 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 .9. Property or lo alter the sequencing of the Development in a manner inconsistent with tlie Deveiopmcnt Plan or the Development Plan Approval{s) (including without limitation the Future Development Approvals when issued by CITY), whether the same arc 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 -- Cooneration. 3.1.3.1 Processing. CITY agrees that ii shall accept and expeditiously process, pursuant lo CITY's regular procedures, complete applications for the Future Development Approvals and, if applicable, STROSCHER's complete applications for amendments to this Agreement, to the Development Plan Approval(s), and to any of the Future Dc\clopment Approvals (after the same have been initially approved). 3.1.3.2 Other Permits. CITY further agrees to reasonably cooperate with STROSCHER, at no cost to CITY, in securing any County, Stale, and Federal permits or authorizations which may be required in connection with Development of the Property that are consislenl 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. 3.1.3.3 Acquisition of Off-Site Property. CITY shall not postpone or refuse approval of any Future Development Approval because STROSCHER or a Development Transferee has failed to acquire off-site property required for the construction or installation of offsite improvements. To the extent CITY, STROSCHER. 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, STROSCHER or the Deveiopmcnt Transferee shall make a good faith effort to acquire the required property. If STROSCHER 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 lo acquire the required property by negotiation or condemnation within the time frame pro^nded for in Government Code Section 66462.5, CITY shall continue to issue the Future Development Approval(s) for the Propetty 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) STROSCHER or the Development Transferee submitting the improvement plans required for the improvement to CITY; and (ii) consistent with Government Code Section 66462.5, STROSCHER or the Development Transferee entering into a mutually acceptable agreement with CITY that requires STROSCHER or the Development Transferee to pay or reimburse or secure the future payment or reimbm-sement of CITY for STROSCHER's fair share of the costs incurred in acquiring the land and constructing the applicable offsite improvcmcnt(s) at such time as CITY acquires the required land. -10- 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 the Existing Land Use Regulations 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) Although CITY reserves the authority to change its Existing Land Use Regulations, no such future changes in the Existing Land Use Regulations shall apply to the Project, if such future changes in the Existing Land Use Regulation would be inconsistent with the Development Plan, the Project Development Approvals, or any of the provisions of this Agreement, nor shall any such future changes applicable to the Project materially jeopardize or impair the rights of STROSCHER thereunder or materially increase the cost of Developing the Project; (ii) Upon request by STROSCHER, CITY shall provide WTitten support to S TROSCHER, if STROSCHER files a request for waiver or reduction of a Deveiopmcnt Exaction imposed by any governmental or quasi-governmental agency, aside from the CITY 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. STROSCHER 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 STROSCHER 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 STROSCHER determines that a slate 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 slate or federal law or regulation, a copy of the law or regulation, and a WTitten statement of the conllicls between such state or federal law or regulation and this Agreement. Promptly thereafter CITY and STROSCHER 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 Parly reserves its discretion with respect thereto. CITY agrees to cooperate with STROSCHER in resolving the conflict in a manner which minimizes any adverse fiscal or other impact of the conflict upon STROSCHER, 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 STROSCHER's proposed changes to the Development Plan and/or Development Plan Appro\'aI(s) as may be necessary to comply with such federal or state law or regulation; provided, however, that the -n- 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 STROSCHER 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 STROSCHER'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 lo 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 STROSCHER to develop hereunder due to public health or safety concerns, CITY shall provide STROSCHER with waitten 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 STROSCHER 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 pai't, is necessary. In such negotiations, CITY and STROSCHER agree to preserve the terms of this Agreement and the rights of STROSCHER as derived from this Agreement to the maximum feasible extent while resolving the conflict. CITY agrees to cooperate with STROSCHER in a good faith reasonable effort to resolve any such contlict in a manner which minimizes any adverse financial or other impact of the conflict upon STROSCHER without materially increasing the obligations of CITY under this Agreement. CITY also agrees in such event to process in an expedited manner STROSCHER's proposed changes to the Deveiopmcnt Plan and any previously issued Development Plan Approval(s) as may be necessary lo appropriately respond to the public health and safety concern with respect to the portion of the Property owned by STROSCHER; 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 wTitten consent of the owmer(s) thereof. 3.3 Further Assurances to STROSCHER Regarding Exercise of Reserved Authority. The Parties further acknowledge that the public benefits to be provided by STROSCHER 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"), STROSCHER is concerned that normally the judiciai'y 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, STROSCHER 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 CTTY's reserved authority shall not be considered to be a -12- violation of this Agreement. In this regard, from and after the date that CITY approves the Project, if STROSCHER judicially (including by way of a reference proceeding) challenges CITY's purported exercise of its reserved authority as being in violation of this Agreement, STROSCHER shall bear the burden of alleging that such purported exercise by CITY of its Reseiwed 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 Ibis Agreement and relying thereupon, STROSCHER is obtaining certain vested rights to proceed with the Development anticipated by the Development Plan and the Developmenl Approvals and in accordance with the terms and conditions of this Agreement (as the same may be amended and supplemented from time to time as expressly set forth herein) and the Existing Land Use Regulations. 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 occupancy, density or intensity of the Project as provided for in the Development Plan or the Development Plan Approval(s): or (ii) It imposes Development Exactions on the Property other than those in effect on the Effective Date or as othemise 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) Eav,'s that provide for the relocation of structures within the Property pursuant to an application from STROSCHER; and (ii) Any law that is expressly authorized by this Agreement. 3.4.3 Initiative Measures. In accordance with state law, in addition to and not in limitation of the foregoing, it is the intent of STROSCHER and CITY that no moratorium or other limitation (whether relating to the Development of all or any pail of the Property and whether enacted by initiative or otherwise) affecting site development pennits, precise plans, site development plans, building permits, occupancy certificates, or other entitlements lo use approved, issued, or granted within CITY, or portions of CI TY, shall apply to the Property to the extent such moratorium or other limitation would restrict STROSCHER's right to Develop the various elements of the Project on the Property in such order and at such rate as STROSCITER deems appropriate. 3-5 Subsequent CEQA Review. -13- 3.5.1 The EIR. The CITY certifies that the EIR prepared on behalf of the CITY in conjunction with the Project is a complete and accurate document which satisfies all the requirements of the California Environmental Quality Act ("CEQA," California Public Resources Code Section 21000 et seq.) and the State CEQA Guidelines (14 California Code of Regulations 15000 ei seq.) with respect to the Project and this Agreement, CITY agrees that no mitigation measures arising out of environmental concerns that are not included in the MMRP for the EIR or this Agreement shall be imposed on the Project except as otherwise provided in this Section. In exercising its legislative discretion to enter into this Agreement and to commit CITY to the completion of the Project, CITY has further reviewed and considered from a variety of perspectives, and has analyzed pursuant to a variety of assumptions, the projected future regional and cumulative environmental demands that will compete with the Project for available capacities and cumulatively add to potential adverse impacts. 3.5.2 Subsequent CEQA Review, In accordance with state law, the Parties Lo this Agreement intend that the EIR fully and adequately addresses all potential ad^'erse enviromnental impacts from full development of the Project. After consideration of the potential adverse environmental impacts associated with the Project, the CITY has imposed initigation measures in accordance with CEQA, as specified in the MMRP to the fullest extent the CITY considers feasible and necessaiy. The CITY has determined that the Deveiopmcnt of the Project in the manner contemplated by the Project Approvals and this Agreement will provide the mitigation measures needed to alleviate short-nm and long-run potential adverse environmental impacts created by the Project, and that the public benefits to be derived from the Development of the Project override any potential adverse enviromnental impacts which may arise from the Development of the Project. Therefore, the CITY agrees that no subsequent or supplemental EIR shall be required by the CITY for any Subsequent Discretionary Project Approvals implementing the Development of the Project unless required pursuant to California Public Resources Code Section 21166 and Title 14 California Code of Regulations, Section 15162. For pur|70ses of this analysis, the term "new information" does not mean discovery that probabilities of adverse (or beneficial) results considered in the approval of this Agreement, the Existing Project Approvals or the FIR may prove incorrect, or that such probabilities are or are not becoming, or have or have not become, realities; but instead, "'new information" requires that the actual quantitative or qualitative extent of the underlying issues were not considered and could not have been considered in the enviromnental analysis associated with the approval of the Existing Project Approvals, this Agreement and the EIR. 3.6 Subsequent Project Approvals. 3.6.1 Basis for Denying or Conditional Granting Subsequent Project Approvals. The CITY is bound to permit the uses on the Property that are permitted by the Existing Land Use Regulations and the Development Plan Approvals. The CITY agrees to grant and implement all Ministerial Approvals, as long as the Ministerial Approvals comply with the Existing Land Use Regulations, the Agreement, and are consistent with the Dexelopmenl Plan Approvals, including but not limited to, building plans and permits, specifications, reclamation plans, landscape plans, grading plans and permits, and use permits reasonably necessary or desirable to accomplish the goals, objectives, policies and plans described in this Agreement. 4'his Agreement shall not prevent the CITY from denying or condilionaiiy approving any Discretionary Approval on the basis of the Existing Land Use Regulations, subject, however, to the provisions of Sections 3.1 and 3.4 of this Agreement. -14- 3.6.2 Duty to Grant and Implement. Subject to the requirements of state law and the CITY Kfunicipal Code, the CITY's obligation to grant and implement any Ministerial or Discretionary Approvals shall not infringe upon the CITY's right lo withhold such Futui'e Development Approvals for failure of the applicable Application to conform to the Existing Land Use Regulations. If the CI TY rejects an application for a Ministerial or Discretionary Approval, it shall provide, in good faith, a specific list of rea.son.s why the application was rejected, along with a description of reasonable measures ("Measures to Correct") to correct each basis for rejection. If Developer resubmits its application incorporating all the Measures to Correct, the CITY shall not unreasonably deny Developer's application. 3.6.3 Processing Obligations. I'he CITY hereby agrees that it will accept from the Developer for processing and review all applications for Future Development Approvals, in accordance with the Existing Land Use Regulations. To the fullest extent allowed by law, the CITY shall process ail applications filed in connection with the Development of the Project as expeditiously as possible and shall complete at the earliest possible lime all steps necessary for the implementation of this Developmenl Agreement and the Development of the Project, including, but not limited to, the following: (a) The processing of applications for and the issuance of all Project Approvals requiring the exercise of judgment and deliberation by the CITY, including without limitation, the Subscqucnl Project Approvals; (b) The retention, upon the Developer's request, of outside plan check consultants, to be selected by CITY, in consultation with STROSCHER, to assist in processing of applications and plans (including infrastructure and storm drain plans), at the Developer's cost: (c) The holding of any required public hearing.s: and (d) CITY performance ol' all required inspections called for by Developer within fifteen (15) business days following the request for inspection by Developer. 3.6.4 Changes in the Project. In accordance with the City Municipal Code, CITY acknowledges that the Developer may in Ihe future desire to change or modify the Project based on precise planning, changes in market demand for aggregate products, changes in development occurring in the vicinity of the Property, or other factors. All such Project revisions shall be subject to the provisions of Subsections 3.5.1, 3.5.2, 3.6.1. 3,6.2 and 3.6.3 of this Agreement. In such event, CITY' sliall cooperate with Developer to expcditioush- review and take final action on such requested changes in accordance with the Existing Land Use Regulations. No change to the Project which is consistent with the Existing Land L'se Regulations shall require an amendment to this Agreement and. in the event any change to the Project proposed by Developer is approved by the CITY, the references in this Agreement to the Project of applicable portion thereof shall be deemed to refer to the Project as so changed. 3-7 Development Impact Fees. N<nwithstanding anvlhing to the contrary in this Agreement, and subject to the provisions of Section 3.7.1, the only Development Impact Fees that may be applied to the Project, Developer or Property in connection with the Project shall be those existing on the Entry Date. Development Impact Fees shall be paid at the fee rate in effect at the -15- lime when payment for such fees is due and payable, for the portion of the Property to which such fees apply. 3.7.1 Applicability of Temporary Reductions in Developmenl Impact Fees. On July 20, 2010, the City Council adopted Resolution No. 10-7-20-01, mandating a seventy-five percent (75%) reduction in sewer, traffic, and water Development Impact Fees for hotels and vehicle dealerships from the rale otherwise applicable for commercial/industrial uses (collectively, the "Decreased Impact Pees"). Notwithstanding the July 31, 20II expiration date of Resolution No. 10- 07-20-01, the Project shall be subject to the Decreased Impact Fees, as long as the first building permit for construction of the hotel building is issued on or before the second (2"^) anniversary of the Effective Date. If the first building permit for construction of the hotel building is issued after the second (2"*^) anniversary of the Effective Date and before the third (3^*^) anniversary of the Effective Date, then the Project shall qualify for a fifty percent (50%) reduction in sewer, traffic and water Development Impact Fees. If the fust building permit for construction of the hotel building is issued after the third (3'^'^) anniversary of the Effective Date and before the fourth (4"^) amiiversary of the Effective Date, then the Project shall qualify for a fifty percent (25%) reduction in sewer, traffic and water Development Impact Fees. No reduction will be available after the fourth (4"') anniversary of the Effective Date. Pursuant to Resolution No. 10-7-20-01, the Decreased Impact Fees shall apply to the hotel portion of the Project. Furthermore, the parties agree that if the expiration date of Resolution 10-7-20-01 is extended or a similar fee reduction program is established which provides lower fees than those stipulated to herein, the lower fee program shall apply. 3.7.2 Developer's Right to Contest Increases in Development Impact Fees. Nothing in this Agreement shall prevent Developer from contesting, in any appropriate forum, the imposition or the amount of any new Processing Fees or any increase in the Development Impact Fees. Such right of protest shall not extend to the current amount of any Development Impact Fees or Processing Fees in effect as of the Entry Date of this Agreement, and the Developer hereby agrees to pay the same pui'suant to the terms of this Agreement and the CITY's normal fee payment schedule. Notwithstanding any pending contest of such fees, CITY shall proceed with issuance of all required Project Approvals and shall not withhold or delay issuance of those Project Approvals based upon any pending protest or appeal with respect to such fee. 3.8 Amendment of Development Agreement. 3,8.1 Initiation of Amendment. Any Party may propose an amendment to this Agreement, and all Parties agree thai it may be beneficial to enter into additional written 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 tlie Development Plan or to any conditions of approval contained therein shall require an amendment of this Agreement. 3-8.2 Procedure. Except as set forth in Section 3.8.4 below, the procedure for proposing and adopting an amendment to this Agreement shall be the same as the jirocedure required for entering into this Agreement in the first instance. -16- 3.8.3 Consent. Except as expressly provided in this Agreement, any amendment to this Agreement shall require the WTitten 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, jeopai-dize, or impair the rights and does not increase the obligat ions of STROSCHER that owns said portion of the Property. No amendment to all or any provision of this Agreement shall be cffccti\'c unless set forth in writing and signed by duly authorized representatives of each of the affected Parties. 3.8.4 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 llexibility 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 minor in nature and are appropriate to further the intended puiqjoses 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 lime to lime. The City Manager shall have the authority, on behalf of CITY, to approve and execute such operating memoranda and S I ROSCHER shall have the authority, on behalf of STROSCHER, to approve and enter into such operating memoranda. Unless otherwise required b\ law or by the Development Plan Approval(s), no such changes, adjustments, or clarifications shall require prior notice or hearing. 3.9 Future Amendments to Developmenl Plan. Subject to the provisions of Sections 3.5 and 3.6 of this Agreement. The following rules apply to future amendments to the Development Plan: 3.9.1 STROSCHER's Written Consent. Any Development Plan amendment to which STROSCHER does not agree in witing shall not apply to the Property while this Agreement is in effect. 3.9.2 Concurrent Development Agreement Amendment. Any Developmenl Plan amendment requiring amendment of this Agreement shall be processed concurrently with an amendment to this Agreement, 3.9.3 Effect of Amendment. E.xccpt 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. 4. Miscellaneous Obligations of the Parties. 4.1 STROSCHER's Obligations. 4.1.1 Project Conformance with CITY Policies and Us General Plan. 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. The traffic and circulation elements of the Developmenl Plan will conform lo CITY's General Plan. -17- 4-1-2 DcdicaTion of Easement Interest for Parking Lot Air Space Parcel. As depicted in Exhibit "B", prior lo approval of a final map for the Property, STROSCHER shall dedicate to the CITY, an easement interest in the Parking Lot Air Space Parcel. If the CITY does not accept this dedication before this Agreement expires, then the CITY agrees that tlie Parking Lot Air Space Parcel will revert to STROSCHER. In no event shall dedication of the easement interest of the Parking Lot Air Space Pai-cel eliminate any of the Project's parking spaces, and future improvements in this air space shall not disrupt the Development or operation of the Project. 4.1.3 Water System Upgrade. Project Mitigation Measure MM 4.11.201b and Project Condition of Approval No. 48 require STROSCHER to construct a loop system to run from a POC in the 350C system at the intersection of El Horno and the [-5 Freeway ("El Horno Section") to a connection lo the 350C system at the intersection of Ortega Highway and Avenida Los Cerritos ("Ortega Section"). Compliance of these conditions may be resolved as follows: a. During the future reconstruction of tJie Ortega Bridge over the 1-5, CITY has requested Caltrans to provide for the water interconnect required to create the Ortega Section loop. Should the El Horno Section provide sufficient fire flow as determined by the fire marshall, STROSCHER shall not be required to construct the Ortega Section. Prior to the time the Ortega Section is to be constructed. STROSCHER and CITY may reconsider STROSCHER's fair share for the cost of construction and/or the Parties may enter into a reimbursement agreement lo specify S TROSCHER's fair share and reimbursement should new dcvciopment be proposed, which would benefit from the Ortega Section construction. City will waive this requirement in the event that grant funding becomes available to fluid the construction of the Ortega Section. b. STROSCHER shall construct the El Horno Section to provide sufficient fire flow to the Property as determined by the fire marshall. STROSCHER and CITY may reconsider STROSCHER's fair shai"e for the cost of construction should new development be proposed, which would benefit from the El Horno Section construction. 7he Parties may further enter into a reimbursement agreement to specify STROSCHER's fair share and reimbursement should new development be proposed, which would benefit from the El Homo Section construction. City will waive this requirement in the event that grant funding becomes available to fund the construction of the Ortega Section. 4.2 CITY'S Obligations. 4.2.1 Undcrurounding of Power Tines. Subject to exercising its legislative discretion, CITY shall consider the creation of a utility district ("Utility District") to fund the Undergrounding of Powxt Lines. Regardless of when the Utility District is formed, the Utility District shall be responsible for funding, designing, and constructing the Undergrounding of Power Lines. STROSCHER shall support creation of a Utility District, and agrees to have the Property subject lo assessment, if such a district is formed by CITY. In such a situation, S TROSCHER shall be deemed to have satisfied Project Condition of Approval No. 118. If formed, the Utility District shall consist of additional benefitted properties, in addition to the Property. If CITY has not created the Utility District, and not imposed the assessment on relevant properties in the area, including the Property, before issuance of the first (C^) certificate of occupancy for the Project, CITY agrees that STROSCHER shall have no obligation lo Underground the Power Lines, and STROSCHER shall not be required to comply with Project Condition of Approval No. 118. If CITY forms and funds the Utility District after the issuance of the first (C) certificate of occupancy, STROSCHER shall support creation of the Utility District and agrees to have the Properly subject to assessment, if such -18- district is formed by the CITY. If CITY or the Utility District elects to Underground the Power Lines, STROSCHER agrees to provide CITY or Utility District with a temporary construction easement, with the terms of such easement to be mutually agreed upon by the Parties, to allow the undergrounding of the lines to occur. 4.2.2 Reconstruction of Project Entryway. Subject to exercising its legislative discretion, CITY agrees to assist STROSCHER in its attempts to have Caltrans reconstruct the Project entryway, due to the future relocation and expansion of Ortega Highway. CITY's assistance to STROSCHER shall not include any financial assistance unless CITY, in its sole discretion, determines to provide financial assistance. 4.2.3 Reversion of Portions of the Ortega Highway Riuhts-of-Way. Subject to exercising of its legislative discretion, CITY agrees to undertake all reasonable good faith efforts to reconvey to STROSCHER the Excess Ortega Rights-of-Way. 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"), STROSCHER, 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 STROSCHER under this Section 5 are solely subject to and conditioned upon the Indemnified Parties' written request to STROSCHER 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 STROSCHER is such that STROSCHER is an independent contractor and not an agent or employee of CITY. CITY and STROSCHER 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 STROSCHER 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 v/riting and signed by duly authorized representatives of each Party hereto. This provision shall not limit any Party's remedies as provided by Section 9. -19- 8. Periodic Review of ComnUancc with Agreement 8.1 Periodic Review. CITY and STROSCHER 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 STROSCHER. CITY shall notify Sl^ROSCHER 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, STROSCHER shall be required to demonstrate good faith compliance with the terms of this Agreement. S'l'ROSCHER agrees to furnish such reasonable evidence of good faith compliance as CITY, in the exercise of its reasonable discretion, may require. If requested by STROSCHER, CITY agrees lo provide to ST'ROSCHER a certificate that STROSCHER or its Developmenl Transferee is in compliance with the terms of this Agreement, provided STROSCHER reimburses CITY for all actual and direct costs and fees incurred by CITY with respect thereto. If CITY fails lo undertake the annual review process specified in Section 8,1 of this Agreement, STROSCHER shall be deemed to be in full compliance with the Agreement, and the Agreement shall be deemed to be in full force and effect. 8.3 Failui-e to Conduct Annual Review. The failure of CITY to conduct the annual review shall not be a Default by STROSCHER. nor shall any such failure alter, suspend, or terminate any of the Parties' other rights and obligations hereunder. Aside from the provisions of Section 8.2 of this Agreement, STROSCHER shall not be entitled to any remedy for a failure by CITY to conduct this annual review. 8.4 Initiation of Review bv City Council. In addition to the annual review, the City Council may at any lime initiate a review of this Agreement by giving written notice to STROSCHER. Within thirty (30) days following receipt of such notice, STROSCHER shall submit evidence to the City Council of STROSCHER'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 STROSCHER. 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 herewitl"] may be appealed b>- STROSCHER to the City Council, provided that any such appeal shall be filed with the City Clerk within ten (10) days after STROSCHER 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 STROSCHER, CITY agrees to provide to STROSCHER 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 STROSCHER reimburses CITY for al! reasonable and direct costs and fees incurred by CITY with respect thereto. CHW shall respond to STROSCHER's request on or before ten (10) business days have elapsed from CITY's receipt of such request. -20- 9. Events of Default: Remedies and Termination. 9.1 Defaults bv STROSCHER. If CITY determines on the basis of a preponderance of the evidence that SIROSCHER has not complied in good faith with the terms and conditions of this Agreement, CITY may, by written notice lo STROSCHER, specify the manner in which STROSCHER has failed to so comply and state the steps STROSCHER 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 STROSCHER has failed to so comply, STROSCHER does not commence all steps reasonably necessary to bring itself into compliance as required and thereafter diligently pursue such steps to completion, then STROSCHER shall be deemed to be in default under the terms of this Agreement (a "Default"). In such event, CITY may terminate this Agreement pursuant lo Government Code Section 65865.1 with respect lo the Property. In material event of Default by STROSCHER, 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 STROSCHER 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, STROSCHER 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 STROSCHER 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, STROSCHER's sole remedy is to terminate this Agreement with respect to the Property or pursue 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 lo restore the Property to its pre-development condition once implementation of this Agreement has begun. After such implementation, STROSCHER may be foreclosed Ifom other choices they may have had to utilize the Property and provide for other benefits. STROSCHER 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 Developmenl 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 STROSCHER for such efforts. For the above reasons, CITY and STROSCHER agree that damages would hot be an adequate remedy if CITY fails to carry out its obligations under this Agreement and that SIROSCHER shall have the right to seek and obtain injunctive relief and specific performance as a remedy for any Default by CITY hereunder. CITY and STROSCHER further acknowledge that, if STRO'sCHER'fails lo cairy out its obligations under this Agreement, CITY shall have the right to refuse to issue any permits or other approvals which STROSCHER otherwise \\-ould have been entitled to pursuant to this Agreement that are related lo and depend upon STROSCtlER's performance hereunder. Therefore, CITY's remedy of specific perfomiance 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 STROSCHER 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 -21- STROSCHER then fails to satisfy such condition, CITY shall be entitled to specific performance for the sole purpose of causing STROSCFIER 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 STROSCHER to othervvise 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, STROSCHER 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 Paily 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 cither orally or in witing 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. 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 Parlies for all actual and direct costs and fees incurred by such Party or Parties with respect thereto. 10. Waivers and Delays. iO.l 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. -22- 10.2 Third Parties. The Parlies' 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 Majeui-e. Notwithstanding any other provision set forth in this Agreement to the contrary, STROSCHER 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 STROSCHER's control, STROSCHER'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 anv other causes that are without the fault and beyond the reasonable control of STROSCHER. 10.4 Extensions. In addition to qualifying for a possible extension of the Term of this Agreement, as provided in Section 2.3, the Term of this Agreement and the times for performance by STROSCHER or CITY of any of sis obligations hereunder or pursuant to the Dcvciopment Plan Approval(s) shall be extended by the period of lime that any of the events described in Section 10.3 exist andfar 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 ifom the acts or omissions of CITY or any other governmental agency or public utility and beyond the reasonable control of STROSCHER. 10.5 Notice of Delay. STROSCHER shall give notice to CITY of any delay which STROSCHER 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 STROSCHER 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 proAaded 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 -23- San Juan Capistrano, CA 92675 Atlenlion: City Manager with a conv to: Woodruff, Spradlin & Smail 555 Anton Boulevard, Suite 1200 Costa Mesa, CA 92626 Attention: Omar Sandoval, City Attorney Notices to STROSCHER shall be addressed as follows: Gretchen Stroscher Thomson Stroscher G3, LLC P.O. Box 129 San Juan Capistrano, CA 92693 Tom MeiTell Civic Solutions, Inc. 27362 Calle Arroyo San Juan Capistmno, CA 92675 with a copy to: Alien Matkins Leek Gamble Mallory & Natsis LLP 1900 Main Street. 5"Mloor Irvine, CA 92614 Attention: John Condas, 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 Parly may change its address for notices by giving notice in writing lo 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 STROSCHER (including, as applicable, any Development Transferee) and any act or omission by STROSCHER (or such Developmenl 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 puiposes. 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 lo CITY, in the Onicial Records of Orange County by the City Clerk within the period required by Section 65868.5 of the Government Code. 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 Properly once the Agreement has terminated. 14.2 Encumbrances and Lenders' Rights. The Parties hereby agree that this Agreement shall not prevent or limit STROSCHER (including without limitation any Development Transferee hereunder), at any lime 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 witli any mortgage, deed of trust, sale and leaseback aiTangcmcnt, or other security dc3'ice. 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 lo this Agreement or the Deveiopmcnt 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. CTfY 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 purj^ose 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-Ueu of foreclosui'e (collectively, a "holder") shall be entitled to receive a copy of any notice of Default (as defined in Section 9.1 hereoi) delivered to STROSCHER 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 wTitlcn notification of any Default by STROSCHER 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. 7'he 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 erne 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 cia-ed within such period, then to commence to cure such Default. Further, a holder shall not be required to cure any non-curable Default of STROSCHER, and any such Default shall be deemed cured if any lender obtains possession. 15. SeverabilitA' of Terms. If any lerm, 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 arc mutual covenants. The covenants contained herein constitute conditions to the concurrent or subsequent performance by each Party benefited thereby of the covenants lo 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 MisceUancous 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 govemed and inteipreted 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 lo constitute, nor shall be construed to constitute, an impermissible attempt to contract away the legislative and governmental functions of CITY, and in paiticular, CTTY'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 STROSCHER and their respecti3'e 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 STROSCHER 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 STROSCHER's prior wTilten consent. In the event of any such litigation, lo 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, STROSCHER 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. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the day and year dated below. Dated: Of fyJ^J ,2011 "CITY" Cn Y OF SAN JUAN CAPISTRANO, a municipal corporation Dated: f-.26 ,2011 "STROSCHFR" -27- PUBLIC AGENCY FORM OF ACKNOWLEDGEMENT State of California County of Orange ) ) ss. City of San Juan Capistrano ) (GovT Code 40814 & Civil Code 1181) On July 28, 2011 . before me, Maria Morris, City Clerk, personally appeared Sam AUevato, Mayor, who proved to me on the basis of satisfactory evidence lo the be person(s) whose namc(s) is/are subscribed lo the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacily, 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) ,/ \\ OPTIONAL Capacity Claimed by Signers Description of Attached Document Title or Type of Document Mayor Title Development Agreement (Plaza Banderas Hotel and Mixed Use Project) City of San Juan Capistrano and Stroscher G3, LLC Signer is Representing City of San Juan Capistrano Date of Document: July 5, 2011 Number of Pages: 194 STROSCHER G3, LLC, a Califoniia limited liability company By: Stroscher Capistrano, LLC, a Delaware limited liability company Its: SolcM Gretchen Stroscher Thomson, as Trustee of the Thomson Family Taist ii/d/t dated Octobers, 1990 Its: Authorized Person STATE OF CALIFORNIA ) ) ss COUNTY OF ORANGE ) On tsCf-j /9 / Ao i I before mc, RviU'CtZj Cg^-^J a Notary Public, personally appeared __£2j~jrR£^ \? JptpA'-^O^ / ^ -"--^ proved to me on the basis of satisfactory evidence to be the person{s) whose name(s) is/are subscribed lo the within instrument and acknowledged to me that he/she/lhey 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. 1 declare under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and con'ect. Witness ray hand and official seal. [SEAL] COMMJ 1672181! ^ KotHryTublic STATE OF CALIFORNIA ) ) ss COUNTY OF ORANGE ) On before me, a Notaiy Public, personally appeared personally known to me (or proved to me on tlie basis of satisfactory evidence) to be the pcrson(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. Wimess my hand and official seal. Notary Public [SEAL] EXHIBIT "A" LEGAL DESCRIPTION OF THE STROSCHER PROPERTY PARCtl DESCRIPTIONS PARCEL 1: THAT PORTION OF LOT 12 OF TRACT NO, l(l3, IN THE COUNTY Ot ORANGE. STATE OF CALEFOR- NIA, AS PER MAP RECORDED IN BOOK 11. PAGHS 29 TO 33 INCLUSIVE OF MISCELLANEOUS MAPS. IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DBSCRIBF.D AS FOI.I OWS- BEGINNING AT THE SOUTHWEST CORNER OfSAID LOT 12. THENCE NORTH 8 ' 18? 07' WEST 154.00 FEET ALONG THE WESTERLY LINE OF SAID LOT; THE CE SOUTH 84' 27? 07" EAST 129.00 FEET PARALLEL WITH THE NORTHERLY LINE OF SAID LOT; HIENCE SOUTH 8' 187 07" EAST 15S.O0 FEET, MORE OR LESS, TO THE NORTHERLY LINE OF THAT CERTAIN BO.OO FOOT STRIP OF LAND CON- VEYED TO THE STATE Of CALIFORNIA BY DEED RECORDED JUNE 28. 194Q IN BOOK 1049,PAGE 349 OF OFFICIAL RECORDS. BEING A CURVE CONCAVE NORTHERLY AND HAVING A RADIUS OF 960.00 FEET. THENCE WESTERLY ALONG SAID NORTHERJ-Y LINE AND ALONG THE SOUTHERI..Y LINE OF SAID lOT 12 TO THE POINT OF BEGINNING. APN. 124-170-14 PARCEL 2; THAT PORTION OF LOT 12 IN TRACT NO. 103, IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK U, PAGES 29 TO 33 INCLUSIVE OF MISCED.ANEOUS MAPS. IN T™ OFFICE OF THE COUNTY 8f CORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT A POINT ON THE WESTERLY LINE OF SAID LOT 13. NORTH S' 1S? 07' WEST, 154.00 FEEI FROM THESOUIHWESTCURNERUFSAIDLOT 12;THP.NCE SOUTH 84'27? 07" EAST 129.00 FEET PARALLEL WITH THE NORTHERLY LINE OF SAID LOT 12. THENCE SOUTH 8' 197 OT EAST 155.00 FEET, MORE OR LESS, TO THE NORTHERLY LINE Of THAT CERTAIN 80.00 FOOT STRIP OF LANT) CONVEYED TO THE STATE OF CALIFORNIA BY DKFD RECORDED JUNE 28,1940 IN BOOK 1049. PAGE 349 OF OFFICIAL RECORDS. BEING ACURVE CONCAVE NORTHERLY AND HAVING A RADIUS OF 960.00 FEET; THENCE EASTERLY 11.40 FEET ALONG SAID CURVE TO THE NORTHWEST- ERI,V LINE OF THE LAND DESCRIBED AS PARCEL 1. DJ THE DEED TO THE STATE OF CAIJFORNIA RECORDED NOVEMBER 2], 1957 IN BOOK 4110, PAGE 52(1 OF OFFICIAL RECORDS, THENCE NORTH 73 • 027 13" EAST ALONG SAID NORTHWESTERLY LINE TO A LINE PARALLEL WITH AND EASTERLY 70.00 FEET, MEASURED AT RIGHT ANGLES FROM THE LAST DESCRIBED LINE HAVING A BEARING OF SOUTH 8' 187 07" EAST; THENCE ALONG SAID PARALLEL LINE NORTH 8' 187 07- WEST TO A LINE PARALLEL WITH AND NORTHERLY 70,00 FEET, MEASURED AT RIGHT ANGLES FROM THE COURSE DESCRIBED ABOVE AS BEARING SOUTH 84' 27? 07" liAST 129.00 FEET; THENCE ORTH 84 ' 27? 07" WEST ALONG SAID PARALLEL LINE TO 'DIE WESTERLY LINE Of SAID LOT 12; [-HENCE SOUTH B' 187 07" EAST 72,10 FEET TO THE POINT OF BECINNTNQ. APN: 124-170-12 PARCEL 3: TH.AT PORTION OF LOT 12 Ot TRACT NO. 103, IN THE CITY OF SAN JUAN CAPISTRANO. AS SHOWN ON A MAP THEREOF RECORDED IN BOOK 11, PAGES 29 TO 33 INCLUSIVE, MISCELLANEOUS MAPS, ROCORDS OF SAID ORANGE COUNTY, DESCRIBED AS FOLLOWS. BEGINNING ATAPOINTON THE WESTERLY LINE OF SAID LOT 12. NORTH 8' 187 07" WEST 154. 00 FEF.T FROM THE SOUTHWEST CORNER OF SAID LOT 12, THENCE SOUTH 84 ' 27? 07" EAST 129,(10 FEET PARALLEL WITH THE NORTHERLY LINE OF SAID LOT 12; THENCE SOUTH B' 187 07 " EAST 153.00 FEET, MORE OR LESS, TO THE NORTHERLY LINE OF THAT CERTAIN 80.00 FOOT STRIP OF LAND CONVEYED TO THE STATE OF CALIFORNIA BY DEED RECORDED JUNE 28, 1940 IN BOOK 1049 , PAGE 349. OFFICIAL RECORDS. BEING A CURVE CONCAVE NORTHERLY AND HAVING A RADIUS OF 960.00 FEET THENCE EASTERLY 11.40 FEET ALONG SAID CURVE TOTHENORTirWESTERLYLINEOFTHELANDDESCRlBED AS PARCEL I IN THE DEED TO THE STATF OF CALIFORNIARECORDED NOVEMBER 21, 1957 IN BOOK 4110, PAGE 520, OFHCIAL RECORDS; THENCE NORTHEASTERLY ALONG SAID NORTHWFISTE.RLY LINE TO THE SOUTH- WESTERJ.Y LINE OF THE LAND DESCRIBED AS PARCEL 2 OF SAID DEED RECORDED IN BOOK 4110, PAGE 520, OFFICIAL RECORDS; THENCE ALONG SAID SOUTHWESTERLY LINE, NORTH SB' 287 05 " WEST 174.39 FEET TO THE NORTH LINE OF SAID LOT 12: THENCE ALONG SAID NORTH LINE NORTH 84' 277 07" WEST 435.25 FEET TO APOINT SOUTl! 84' 277 07" EAST 120.00 FEET FROM THE NORTHWFST CORNER OP SAID LOT 13; THF.NCP. AT RIGHT ANGLES SOimi .5' 32? 53" WEST 60.00 FEET: THENCE AT RIGHT ANGLES NORTH 84' 277 07" WEST IfiS .21 FEET TO THE WEST I INF, OP SAID LOT 12; THENCE SOUTH 8' 187 07" EAST 86.41 FEET TO THE POINT OF BEGINNLNG. FDiCEPT TllAT PORTION THEREOF DESCRIBED AS FOLLOWS: BEGINNING AT A POINT ON THE WESTERLY UNE OF S-AID LOT 12, NORTH B' 18? 07" WEST 154. 0 0 FEET FROM THE SOUTHWKIT CORNER OF SAID LOT 12; THENCE SOUTH 84' 277 07 " FAST 129.00 FEET PARALLEL WITH THE NORTHERLY LINE OF SATO LOT 12; THENCE SOUTH B' 187 07" EAST 155,00 FEET, MORE OR LESS TO THE NORTHERLY LINE OF THAT CERTAIN 80.00 FOOT STRIP OF LAND tXJNVEYED TO HIE STATE OF CALIFORNIA BY DEED RECORDED JUNE 28. 1940 IN BOOK 1049, PAGE 349, 01TICLAL RECORDS. BEING ACURVE CONCAVE NORTHERLY AND HAVING A RADIUS OF 960.00 FEET; THENCE EASTERi.Y 11.40 FEET ALONG SAID CURVE TO THE NORTHWESTERLY LCSE OF THE LAND DESCTLEBEU AS PARCEL 1, IN THE DEED TO THE STATE OF CALH-QRNIA, RECORDED NQ-VEMBER 21, 1937 IN BOOK 4110, FACE 520, OFFICIAL RECORDS; THENCE NORTH 73' 02? 13" EAST ALONG SAID NORTHWESTERLY LINE TO A LINE PARALLEL WITH AND EASTERLY 70.00 FEET. MEASURED AT RIGHT ANGLES FROM THE LAST DtiCRJBEU LINE HAVING A BEARLNG Of SOUTH S' 187 08" EAST; THENCE ALONG SAID PAR- ALLEL LINE NORTH 8' 18? 07' EAST 129.00 FEET; THENCE NORTH 84' 277 07 ' WEST ALONO SAID PARALLEL LINE TO THE WESTERLY LINE OF SAID LOT 12; THENCE SOUTH 8' 18? 07" EAST 72.10 FEET TO THE POINT OF BEGDININO. APN: 124-170-15 and 124-170-16 EXHIBIT "A" EXHIBIT "B DEriCTION AND LEGAL DESCRIPTION OF PARKING LOT AIR SPACE PARCEL LEGAL DESCRIPTION THAT PORTION OF LOT 12 OF TRACT NO, 103, IN THE CITY OF SAN RJAN CAPISTRANO, COUNTY OF ORANGE, STATE OF CALIFOR- NIA, AS SHOWN ON A MAP RECORDED IN BOOK 11, PAGES 29 TO 3 3 INCLUSIVE. OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERLY CORNER OF SAID LOT 12; THENCE SOUTH 00°29'25" WEST ALONG THE WESTERLY LINE OF SAID LOT 12 ADISTANCE OF 76.70 FEET TO THE TRUE POINT OF BEGINNTNG; THENCE SOUTH 00='29'25" WEST ALONG THE WESTERLY LINE OF SAID LOT 12 A DISTANCE OF 48.11 FEET; THENCE SOUTH 69°45'3S" WEST ALONG A LINE PARALLEL WITH AND DISTANT NORTHERLY 40.00 FEET, MEASURED AT RIGHT ANGLES, FROM THE CENTER LINE OF ORTEGA HIGHWAY AS DESCRIBED IN EASEMENT DEED TO THE STATE OF CALIFOR- NIA RECORDED IN BOOK 1049 AT PAGE 349 OF OFFICIAL RECORDS, A DISTANCE OF 155.16 FEET; THENCE NORTH 20°37'55" WEST, A DISTANCE OF 63.31 FEET TO A POINT OF NON TANGENCY WITH A CURVE, CONCAVE NORTHERLY, HAVING A RADIUS OF 442.00 FEET; THENCE EASTERLY ALONG SAID CURVE, THROUGH A CENTRAL ANGLE OF 4°48'57", A DISTANCE OF 37.15 FEET; THENCE NORTH 62°58'27" EAST, A DISTANCE OF 53.96 FEET; THENCE NORTH 65°40'50"WEST, A DISTANCE OF 69,32 FEET; THENCE NORTH 84°26'57" WEST, A DISTANCE OF 11.82 FEET; THENCE NORTH 11° 15'29" EAST, A DISTANCE OF 65.32 FEET, SAID POINT LYING ON THE NORTHERLY LINE OF SAID LOT 12; THENCE SOUTH 58°27'57" EAST, A DISTANCE OF 174.39 FEET TO TllV. TRUE POINT OF BEGINTtlNG. Exhibit "B EXHIBIT "C" DEPICTION AND LEGAL DESCRIPTIONS OF EXCESS ORTEGA RIGHTS-OF-WAY LEGAL DESCRIPTION THAT PORTION OF LOT 12 OF TRACT NO. 103, IN THE CITY OF SAN JUAN CAPISTRANO, COUNTY OF ORANGE, STATE OF CALIFOR- NIA, AS SHOWN ON A MAP RECORDED IN BOOK II, PAGES 29 TO 33 INCLUSIVE, OF MISCELLANEOUS MAPS, IN THE OPnCE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHEASTERLY CORNER OF SAID LOT 12; THENCE SOUTH 00°29'25" WEST ALONG THE WESTERLY LINE OF SAID LOT 12 A DISTANCE OF 76.70 FEET TO THE TRUE POINT OF BEGINNING; THENCE SOUTH 00=29'25" WEST ALONG THE WESTERLY LINE OF SAID LOT 12 ADISTANCE OF 48.11 FEET; THENCE SOUTH 69M5'38" WEST ALONG A LINE PARALLEL WITH AND DISTANT NORTHERLY 40.00 FEET. ME.VSURED AT RIGHT ANGLES, FROM THE CENTER LINE OF ORTEGA HIGHWAY AS DESCRIBED IN EASEMENT DEED it) I HE SIAI E OF CALIFORNIA RECORDED IN BOOK 1049 AT PAGE 349 OF OFFICIAL RECORDS, A DISTANCE OF 177.30 FEET TO A POINT OF TANGENCY WITH A CURVE, CONCAVE NORTHERLY. HAVING A RADIUS OF 960,00 FEET; THENCE WESTERLY ALONG SAID CURVE, THROUGH A CENTRAL ANGLE OF 2I°2I'48", A DISTANCE OF 357.95 FEET; THENCE NORTH 73°Or58" EAST, A DISTANCE OF 119.12 FEET TO A POINT OF NON TANGENCY WITH A CURVE, CONCAVE NORTHERLY HAVING A RADIUS OF 729.69 FEET: THENCE EASTERLY ALONG SAID CURVE, THROUGH A CENTRAL ANGLE OF ]ri8'25", ADIS- TANCE OF 144.00 FEET; THENCE NORTH 69°45'38" EAST, A DISTANCE OF 282.05 FEET TO THE TRUE POINT OF BEGINNTNG . EXHIBIT "C" EXHIBIT "D" NARRATIVE DESCRIPTION OF THE PROJECT The Project consists of a three-story, 76,363 square feet, 124-room hotel, on approximately 2 acres; a 10, 169 square foot, two story office/retail building consisting of 6,467 square feet of retail on the first floor and 3,702 square feet of private office and balcony aea on the second floor and II 6,095 square foot restau- rant. The Project providcsl90 parking spaces to serve all uses on the 3.18 acre site. Access to the Project will be from one right turn in and out only driveway on Ortega Highway, one full access driveway on EI Camino Real and one full access driveway at the easterly terminus of Spring Street. Upon the ultimate realignment of Ortega Highway as part of the freeway interchange reconstruction project by CalTrans, the access onto Ortega Highway will be extended as shown on the plans approved by the City of San Juan Capistrano. The Project site and landscape plan is shown in the exhibit below. EXHIBIT "D