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14-0902_TNHC SAN JUAN, LLC_Soils Subsidence Remediation Program AI, recording REQUESTED BY: Recorded In Official Records, Orange County Hu h Ngugen Clerk-Recorder City of San Juan Capistrano ����� � � �������������� NO FEE + $ R 0 0 0 r 0 0 2 4 0 5 8 # 2014000398567 9:03 am 10101114 42 418 Al2 F13 24 WHEN RECORDED MAIL TO: 0.00 0.00 0.00 0,00 88.00 0.00 0.00 0.00 City of San Juan Capistrano Attn: City Clerk 32400 Paseo Adelanto San Juan Capistrano, CA 92675 SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY [EXEMPT FROM RECORDER'S FEE PURSUANT TO GOVERNMENT CODE SECTION 273831 AGREEMENT ESTABLISHING SOILS SUBSIDENCE REMEDIATION PROGRAM 1V C THIS AGREEMENT ESTABLISHING SOILS SUBSIDENCE REMEDIATION PROGRAM ("Agreement") is entered into as of Uka "s: 1 2014 ("Effective Date") , by and among TNHC SAN JUAN LLC, a Delaware limited liability company ("Developer"i , Oliva Maintenance Corporation, a California nonprofit mutual benefit corporation ("Association" ) and the CITY OF SAN JUAN CAPISTRANO ("City") , (Developer, Association and the City are each a "Party" and collectively, the "Parties") , and pertains to that certain real property more particularly described on Exhibit "A" attached hereto and incorporated herein by this reference ( "Property" ) . RECITALS This Agreement is made with reference to the following facts: A. Developer is in the process of developing the Property as a common interest development, more particularly described in Section 4175 of the California Civil Code as a "planned devel- opment" (hereinafter referred to as the "Project") , consisting of single-family detached homes, landscaped areas and other improve- ments, in the City of San Juan Capistrano, County of Orange, State of California. References in this Agreement to "Lots" or "residential Lots" or "individually owned Lots" shall mean and refer to a Lot for residential purposes described and or depicted on a final map for the Property, and defined in the Declaration. References to "Common Area" or "Common Area lots or parcels' in this Agreement shall mean and refer to real property designated "Common Area" or "Association Maintenance Areas" in the Declaration defined below. B. On September 15, 1987, the City Council ("Council") of the City passed, approved and adopted Ordinance No. 605 ("Original Ordinance") , requiring that certain residential development in the City include a Soils Subsidence Remediation Program. On November 15, 2002, the Council passed, approved and adopted Ordinance No. 869 ("Amended Ordinance") , amending Title 9 of the San Juan Capistrano Municipal Code to add Section 9-3 . 545, entitled "Soils Subsidence Remediation Program" and deleting Title 8, Chapter 10 of the San Juan Capistrano Municipal Code as established by the Original Ordinance. C. The City approved Tentative Tract Map No. 16146 (e.g. , Final Tract Map 17713) and all applicable conditions of approvals associated with such map, i.e. , City Council Resolution Nos. 05-12- 20-02, 09-03-17-07, and 07-04-17-03 . D. The Association is a California nonprofit mutual benefit corporation which will own the Common Area within the Property and will serve as the homeowners' association for the residents of the Property. E. In compliance with Title 9, Section 9-3 .545 of the San Juan Capistrano Municipal Code, Developer is required to establish and the Association is required to operate a Soils Subsidence Remediation Program. The City also requires the Developer and the Association to enter into this Agreement . This Agreement shall set forth the terms for the implementation of a Soils Subsidence Remediation Program ("Soils Subsidence Remediation Program") with respect to the Property. F. In addition, the Property will be subject to the terms of that certain Declaration of Covenants, Conditions, Restrictions and Reservation of Easements for Oliva recorded substantially concurrently herewith ("Declaration") . G. The Parties hereto desire to enter into this Agreement as it relates to the Soils Subsidence Remediation Program only and as it relates solely to the Property, to, among other things, more clearly set forth the rights and obligations of the Parties with respect to the Soils Subsidence Remediation Program. H. By entering into and recording this Agreement, Developer satisfies in full with respect to the Property (i) all conditions of approval relating to the Soils Subsidence Remediation Program, (ii) all requirements of the Amended Ordinance, and (iii) all conditions and requirements of the City in any way relating to any soils subsidence remediation programs at any time implemented by the City. 2 AGREEMENT 1. Definitions. Defined terms whose initial letters are capitalized herein shall have the meanings given to such terms as set forth in this Agreement, including on Exhibit "B" attached hereto (if not already defined in the text of this Agreement or the Declaration) . 2 . Soils Subsidence Remediation Program. 2 .1 Soils Subsidence Remediation Program and Term. Developer is required to impose on the Property a Soils Subsidence Remediation Program. This Agreement sets forth the above-referenced Soils Subsidence Remediation Program as it relates to the Property. 2 .2 Developer Repair Period. Pursuant to Municipal Code Section 9-3 .545 c (1)C, Developer shall be responsible for making all "Covered Repairs" necessitated by Soils Subsidences (as defined in Exhibit "B") at its sole expense during the "Developer Repair Period, " which commences on the date of completion of rough grading of the entire site, and continues until the later of the third anniversary of completion of rough grading, or the date of the last close of escrow for the sale by Developer of a Lot in the Property. Notwithstanding this foregoing, Developer shall have the right to reduce or set off its payment obligation for any Covered Repair to the extent the Covered Repair is caused by the negligence or willful act of the City, the Association, members or the Association, Owners of Lots in the Property, or guests and invitees of Owners. In such event Developer shall have every remedy available under this Agreement and applicable law to cause the City, the Association, or the responsible Owner (as applicable) or individual to contribute to the actual costs of making the Covered Repair, to the extent the damage is caused by the City, Association or the responsible Owner, as applicable. If, during the Developer Repair Period, the Developer fails to make Covered Repairs as provided herein, then the City shall have the remedies provided in Section 6 .3 below (subject to notice and hearing and dispute resolution processes described in Section 6) , including the right to draw upon the Developer Repair Period Security to pay the actual costs of making Covered Repairs. 2 .3 Long-Term Covered Repairs; Administration After Developer Repair Period. Upon the expiration of the Developer Repair Period and continuing through the Soils Subsidence Remediation Period, the Association shall assume and perform all its obligations under this Agreement, and the Developer shall have no further obligations under this Agreement. In addition: 3 (a) Covered Repairs necessitated by Soils Subsidences occurring between the expiration of the Developer Repair Period and the end of the Soils Subsidence Remediation Period are "Long-Term Covered Repairs, " the actual cost of which shall be paid from the Surficial Soils Subsidence Fund (defined in Section 2 .4) to the extent funds are available; and (b) As of the date of this Agreement, the City is considering the formation of a Geologic Hazard Assessment District ( "GRAD") for the Property, which, if formed, will have responsibility for performing or causing the performance of such Long-Term Covered Repairs. If the GHAD is formed, it shall, in accordance with Municipal Code Section 9-3 .545(c) (1) (A) , be activated on the first Long-Term Covered Repair, and the GHAD's actual costs incurred in making such Long-Term Covered Repairs shall be paid from the Surficial Soils Subsidence Fund. 2 .4 Surficial Soils Subsidence Fund. No later than the expiration of the Developer Repair Period, Developer shall establish and fund a restricted reserve account in the name of the Association ("Surficial Soils Subsidence Fund") . The Surficial Soils Subsidence Fund shall be regulated, funded and used as follows: (a) In accordance with Section 9 .3-545 of the San Juan Capistrano Municipal Code, Developer shall deposit in the Surficial Soils Subsidence Fund good funds in the amount of the Project Fund Amount as defined in Exhibit "B, " and the City shall concurrently exonerate the Developer Repair Period Security described in Section 6 below; (b) Funds deposited in the Surficial ' Soils Subsidence Fund shall be applied only to actual costs incurred in making Long-Term Covered Repairs, and to the reasonable costs incurred by the Association' s Claims Adjuster (as defined in Section 4 .2) in reviewing claims for Long-Term Covered Repairs. (c) The Surficial Soils Subsidence Fund shall be put under the control of the Association to be managed and funded by it as a restricted reserve fund; (d) The Association shall maintain the balance of the Surficial Soils Subsidence Fund at no less than the Project Fund Amount. Subject to Section 7 . 1 below, the Association shall levy Special Assessments against the Lots as necessary to maintain the balance of Surficial Soils Subsidence Fund and to pay for Long- Term Covered Repairs to the extent funds in the Surficial Soils Subsidence Fund are insufficient to cover the actual costs thereof; 2 .5 Applicability of Soils Subsidence Remediation Program. The slopes which are subject to the Soils Subsidence 4 Remediation Program ("Covered Slopes") are shown on Exhibit "C" attached hereto. 2 .6 Reserved Rights. Developer and the Association reserve the right to assert claims against any person or entity responsible in whole or in part, by reason of negligence or willful misconduct of the person or entity against whom the claim is asserted, for displacement of soil on the slopes, whether covered by the Soils Subsidence definition or not, including without limitation, claims against one another. These reserved rights are subject to all applicable statutes of limitation, including without limitation, the ten (10) year limitations period provided by Section 337 .15 of the California Code of Civil Procedure and the Right to Repair Law provided in Title 7, Section 895 to 945 .5 of the California Civil Code. 2 .7 Inspection and Repair Rights. The Association and GRAD (if formed) shall have licenses or nonexclusive easements to enter onto Common Area and individual Lots to inspect and repair (if necessary) all landscaping, irrigation and drainage devices, and all other natural and artificial conditions which affect or might affect the integrity of Covered Slopes . 2 .8 Prior Review of Owner Improvements . Any proposed alterations by Owners to the landscaping, grading, irrigation or drainage installed on Covered Slopes on individually owned Lots shall be subject to prior review and approval by the Association and the City. 3 . Claims Procedures and Adiustments During Developer Repair Period. During the Developer Repair Period, the Soils Subsidence Remediation Program shall be administered by the Developer. 4 . Claims Procedures and Adiustments After Expiration of Developer Repair Period. After expiration of the Developer Repair Period and continuing through the Soils Subsidence Remediation Period, the Soils Subsidence Remediation Program shall be administered by the Association. The Association shall retain the services of an independent Claims Adjuster (defined below) for all Long-Term Covered Repairs in accordance with the requirements set forth in Section 4 .2 below. The Claims Adjuster shall be responsible to adjust all claims for work which are claimed to be within the coverage of this program. Claims asserted to be within the coverage of this program will be processed on forms substantially in the form attached hereto as Exhibit "D" and filed with the Claims Adjuster, who will promptly adjust such claims after obtaining an analysis on the scope and cost of completing all necessary repairs. Funds in the Surficial Soils Subsidence Fund shall be applied to the cost of the Claims Adjuster' s services. 5 4 .1 Notice of Claim. In the event any Party receives notice of a claim that a Soils Subsidence has occurred, such Party shall give all other Parties written notice of such claim setting forth the name and address of the claimant and the nature and extent of the claim to the extent such information is available. 4 .2 Claims Adjuster. Within fifteen (15) days after receipt of any such notice, the Association shall select an independent and reputable claims adjusting service, geologist and/or soils engineer (duly licensed to the extent required) with experience in handling soils and Soils Subsidence matters (referred to herein as a "Claims Adjuster") . (a) The Claims Adjuster shall be responsible for promptly investigating, allocating responsibility for, and adjusting all claims which allege that a Soils Subsidence has occurred that is within the coverage of the Soils Subsidence Remediation Program. After reasonably appropriate investigation and analysis, the approved Claims Adjuster shall determine, among other things: (i) whether the claim is covered by the Soils Subsidence Remediation Program and if so, then the scope and estimated cost of the Covered Repairs, (ii) who has responsibility under this Agreement for actually performing the Covered Repairs or causing them to be performed, and (iii) who has under this Agreement the financial responsibility for the requisite Covered Repairs. (b) The Claims Adjuster shall complete its analysis as soon as reasonably possible and shall thereupon issue a written report to all of the Parties to this Agreement, which written report shall set forth its findings on the issues referred to above and such other matters as the Claims Adjuster deems appropriate . (c) The Parties agree that they shall promptly comply with the decisions and findings of the Claims Adjuster as set forth in such report. The Parties intend that the decisions and findings of the Claims Adjuster shall be deemed binding upon them and shall be enforceable against them by a court of competent jurisdiction and any Party failing to comply with such decisions and findings of the Claims Adjuster as they affect such Party shall be liable for damages and all other relief as may be determined appropriate by a court of competent jurisdiction. 5 . Grace Period. A Party shall only be deemed in default under this Agreement if such Party fails to perform any of its duties or obligations under this Agreement and such failure is not 6 i cured within thirty (30) days after written notice of such failure has been given to such Party. If such failure cannot reasonably be cured within thirty (3 0) days after the giving of such notice, then said Party shall not be deemed in default under this Agreement if such Party commences to cure the failure within said thirty (30) day period and thereafter diligently and in good faith continues to prosecute such curative action to completion. The notice of failure referred to in this Section 5 shall specify the alleged failure in detail . 6 . Security for Developer' s obligations. 6 .1 Developer Repair Period Security. Developer shall guaranty and secure performance of its obligations under Section 2 .2 above by one of the following alternatives (each, "Developer Repair Period Security") , at the option of Developer with the approval of the City: (a) Corporate sureties in form reasonably approved by the City Attorney with a face amount of the lesser of $31, 390 . 80 or $0.30 per square foot of the Covered Slopes, representing the fully funded amount of the Surficial Soils Subsidence Fund, together with funds representing premiums for annual renewal of the security during the three-year term of the Developer Repair Period; or (b) A deposit of cash in the amount of $31, 390 . 80, either with a responsible escrow agent or trust company, of money or negotiable bonds of the kind approved for securing deposits of public moneys; or (c) An instrument of credit in the face amount of $31, 390 .80, from one or more financial institutions subject to regulation by the state or federal government, pledging that the funds necessary to carry out the Soils Subsidence Remediation Program during the Developer Repair Period are on deposit and guaranteed for payment. 6 .2 Release of Developer Repair Period Security. T h e Developer Repair Period Security is subject to release pursuant to the requirements and procedure set forth in Municipal Code Section 9-3 .545c (2)D(ii) . 6.3 Rights of City Upon Default. If Developer, during the Developer Repair Period in accordance with Section 2 .2 above, or the Association, during the period subsequent to the Developer Repair Period pursuant to the terms of Section 2 .3 above, fails to perform its obligations as required under those Sections, the City Attorney shall provide written notice to Developer or the Association (as applicable) of such failure and provide Developer or the Association (as applicable) with an opportunity to cure in accordance with Section 5, above. In the event Developer or the 7 Association (as applicable) does not cure its failure of performance within the cure period, then the Council may, by resolution or other official Council action, after a noticed public hearing, authorize the Public Works Director ("Director") to draw upon the Developer Repair Period Security (in the case of a Developer default during the Developer Repair Period) or the Surficial Soils Subsidence Fund (in the case of an Association default) to pay for the required work or otherwise cure the default hereunder ("Authorized Monies") . The Surficial Soils Subsidence Fund and the Developer Repair Period Security shall be vested such that the Director can access such funds or security after such Council action and submittal to dispute resolution (if requested by a Party) pursuant to Section 6 .5 below. 6 .4 Public Hearing. Developer or the Association (as applicable) will be entitled to reasonable notice of such public hearing, will have the right to appear at the hearing where the Council action is considered, and will be entitled to assert any and all defenses which Developer or the Association (as applicable) may possess as to such Council action including, without limitation, a claim that the work proposed to be performed is not within the scope of this Agreement or is not reasonably necessary. 6 .5 Dispute Resolution. In the event of a dispute between the City and Developer or the Association (as applicable) involving any aspect of the penalty provided for herein including, without limitation, the propriety of the Council action provided for herein, such dispute shall be resolved by a judicial reference pursuant to Section 8 below. 7 . Special Assessments to Replenish the Surficial Soils Subsidence Fund. Following the expiration of the Developer Repair Period and the concurrent initial funding by Developer of the Surficial Soils Subsidence Fund, the Association shall automatically assume responsibility for administration of the Soils Subsidence Remediation Program and the Surficial Soils Subsidence Fund. The Association' s obligations include the ongoing obligation throughout the remainder of the Soils Subsidence Remediation Period to assess the Lots and Owners in the Property as necessary to maintain at least the Project Fund Amount in the Surficial Soils Subsidence Fund. Notwithstanding anything in this Agreement to the contrary, the Association shall be under no obligation to impose any special assessment to pay for a Long-Term Covered Repair except in accordance with provisions in the Declaration or applicable section of the California Civil Code statutes . 7.1 Replenishment Following Long-Term Covered Repairs. If payments for Long-Term Covered Repairs cause the balance in the Surficial Soils Subsidence Fund to fall below the Project Fund Amount described in Exhibit "B, " then, within a reasonable period determined by the Board in exercise of its business judgment and with the consent of the City (all subject to the provisions of the 8 Declaration and California Civil Code Section 5600 et seq. and successor statutes) , the Association shall restore the total amount in the Association' s Surficial Soils Subsidence Fund to the Project Fund Amount by assessing the Owners and their Lots . 7 .2 Special Assessment to Make Long-Term Covered Repairs. In the event a Long-Term Covered Repair is determined by the Claims Adjuster (described below) to be necessary, but funds available in the Surficial Soils Subsidence Fund are insufficient to cover the cost of such Long-Term Covered Repair, then the Association shall specially assess the Owners at a rate sufficient to cover the cost of such Long-Term Covered Repair within a reasonable period determined by the Board in exercise of its business judgment and with the consent of the City (all subject to the provisions of the Declaration and California Civil Code Section 5600 et seq. and successor statutes) . In the alternative, the Association' s Board may, in the exercise of its business judgment and with the consent of the City, elect to defer such Long-Term Covered Repair to the extent necessary to first accumulate within a reasonable period of time (determined by the Board in exercise of its business judgment and subject to the provisions of the Declaration and California Civil Code Section 5600 et seq. and successor statutes) sufficient funds to cover the costs thereof and then to replenish the balance of the Surficial Soils Subsidence Fund to at least the Project Fund Amount. 7 .3 Cessation of Special Assessments when Proiect Fund Amount Reached. Except in the event that the estimated cost of Long-Term Covered Repairs exceed the Project Fund Amount, the Association may cease levying and collecting special assessments when the total balance of the Association' s Surficial Soils Subsidence Fund reaches the Project Fund Amount. 7.4 Responsibility of the Association and its Board of Directors. The Association and its Board of Directors shall be responsible for establishing and maintaining the Association's Surficial Soils Subsidence Fund as herein provided, and for levying and using best efforts to collect special assessments to restore the balance of the Surficial Soils Subsidence Fund as herein provided. 8. Dispute Resolution. Any dispute arising out of this Agreement, but excluding any construction defect claims or right to repair claims made under Sections 895 to 945 .5 of the California Civil Code, shall be resolved in accordance with the article in the Declaration entitled "Dispute Resolution. " 9. Miscellaneous. 9.1 Additional Limitations on Soils Subsidence Remediation Program. Nothing to the contrary in this Agreement withstanding, it is agreed that: 9 (a) The Soils Subsidence Remediation Program provided herein expressly excludes Soils Subsidence or any other soils or earth movement or failure of slopes, regardless of cause, not expressly referred to herein, and any and all resulting damage, whether arising out of covered Soils Subsidence or not. (b) In no event will performance of repair work by any person or entity or any other circumstances extend the Developer Repair Period provided herein. 9.2 Reservations of License and Right to Enter. (a) There is hereby reserved for the benefit of Developer and its successors, and the Association, and their respective contractors and agents, a license and right to enter onto the Common Areas and individually-owned Lots within the Property so that Developer or its successors and the Association and their respective contractors and agents may (i) inspect all landscaping, irrigation and drainage devices, and all other natural and artificial conditions which affect or might affect the integrity of the Covered Slopes, and (ii) perform the duties of Developer (during the Developer Repair Period) and the Association (after the Developer Repair Period) to the full extent provided for herein. (b) Appropriate provisions in the grant deeds will grant the Developer and the Association and their respective contractors and agents a license and right to enter onto the Common Areas and individually-owned Lots of the Property so that the Developer, the Association and their respective contractors and agents may inspect, maintain and repair the Covered Slopes to the full extent provided for herein. 9.3 Review and Approval by Association Any proposed alterations by homeowners or any other person or entity to the landscaping, grading, irrigation or drainage on the residential Lots or Common Areas will be subject to review and approval by the Board of the Association and/or by its Architectural Review Committee. 9.4 Reference in Deeds. The grant deeds for the residential Lots will reference this Agreement and the Soils Subsidence Remediation Program provided herein. The provisions of this Agreement constitute covenants running with the land and an equitable servitude as to the real property referenced herein. 9 .5 Collection and Reporting The Board of the Association will be responsible for the imposition and collection of special assessments to replenish the Surficial Soils Subsidence Fund, and for accounting for such special assessments and interest thereon. The Board of the Association will report to Developer and to the City the incidence of covered and non-covered claims during the 10 reporting period, as well as the balance in the Association's Surficial Soils Subsidence Fund as of the date of the report. Such reports will be made on or before January 31 and July 31 of each year. The Boards will also provide to Developer at its request, and to the City at the City' s request, any further information, documentation and cooperation as is reasonably necessary to effectuate the purposes of this Agreement. 9.6 Further Acts. The Parties to this Agreement agree to perform such other and further acts and execute such other and further documents as are necessary to effectuate the intent of this Agreement. 9.7 Headings. The headings in this Agreement are inserted for convenience and identification only and are in no way intended to describe, define or limit the scope, intent or interpretation of this Agreement or any provisions hereof. i 9.8 No Representations. No Party or any agent, employee, representative, or attorney of or for any Party has made any statement or representation to any other Party regarding any fact i relied upon in entering into this Agreement, and no Party relies upon any statement, representation or promise of any other Party or of any agent, employee, representative or attorney of any other Party, in executing this Agreement, or making this settlement provided for herein, except as expressly stated in this Agreement. 9 .9 Entire Agreement. This Agreement is the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous oral and written agreements and discussions. This Agreement may be amended only by an agreement in writing among Developer (or its successors in interest or assignees) , the City, and the Association. 9 . 10 Binding Upon Successors. This Agreement is binding upon and shall inure to the benefit of the Parties hereto, their respective successors and assigns. (a) This Agreement is binding upon Developer' s successors in interest or assignees as to the Property, and any or all of them. (b) Effective upon the sale or other conveyance of the Property or any portion thereof in bulk, Developer will be relieved of its obligations under this Agreement as to the real property so sold or conveyed, to the extent that such obligations are assumed in writing by Developer' s successors in interest or assignees, including without limitation the obligation to provide security for the Developer Repair Period herein. Upon the City' s receipt of reasonably adequate substitute security from any assuming Party, the Developer's Security or the appropriate pro rata portion 11 I i thereof shall be appropriately released and exonerated to Developer by the City. 9.11 Construction of Agreement. Each Party has cooperated in the drafting and the preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against any Party. This Agreement shall be construed under California law. 9.12 Counterparts. This Agreement may be executed in counterparts, and when each Party has signed and delivered to the other at least one such counterpart, each counterpart shall be deemed an original, and when taken together with the other signed counterparts, shall constitute one agreement, which shall be binding upon and effective as to all Parties. 9 . 13 Severability and No Waiver. The invalidity or unenforceability of any provision of this Agreement shall not invalidate or render unenforceable any of the other provisions of this Agreement. No waiver of any provision of this Agreement shall constitute a waiver of any other provision, nor shall any such waiver constitute a continuing waiver unless otherwise agreed in writing. 9.14 Termination. Unless otherwise agreed among the Parties, this Agreement shall automatically terminate upon expiration of the Soils Subsidence Remediation Period, at which time the obligations on the part of the Association (or its successors in interest or assignees) will automatically terminate, and any unused funds remaining in the Surficial Soils Subsidence Fund shall be applied to such purposes as the Association deems necessary or desirable in the business judgment of its Board. This Agreement shall not be deemed terminated as provided in this Section 9. 14 as to obligations and liabilities arising because of Slope Subsidence occurring prior to the expiration of the Soils Subsidence Remediation Period so long as a good faith written claim with respect to such Slope Subsidence has been received by the Parties prior to the expiration of the Soils Subsidence Remediation Period. 9.15 Notices. Any notice which either Party may desire to give to the other Party must be in writing and may be given by personal delivery, by mailing the same by registered or certified mail, return receipt requested, postage prepaid, or by Federal Express or other reputable overnight delivery service, or by facsimile or other reliable electronic type mail system to the Party to whom the notice is directed at the address of such Party hereinafter set forth, or such other address and to such other persons as the Parties may hereafter designate. Any such notice shall be deemed given upon receipt if by personal delivery, forty- eight (48) hours after deposit in the United States mail, if sent 12 by mail pursuant to the foregoing, or twenty-four (24) hours after deposit with Federal Express or other reputable overnight delivery service, or twenty-four (24) hours after transmission by facsimile or other reliable electronic type mail system. To Developer: TNHC SAN JUAN LLC c/o The New Home Company 95 Enterprise, Suite 325 Aliso Viejo, CA 92656 Attention: David J. Mello, Jr. , Senior Project Manager Copy To: Gallagher & Moore 2 Park Plaza, Suite 680 Irvine, CA 92614 Attention: Fred Moore To the City: The City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Attn: Public Works Director Facsimile: (949) 493-1251 To Association: Oliva Maintenance Corporation Copy To: The City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 Attn: City Attorney 13 IN WITNESS WHEREOF, this Agreement was executed on the date first above written. City: The City of Juan Capistrano BY: Name: S AI(QJA-IO I-{iGtcf(7(APPROVED AS TO FORM: Attest BY: Hans n Ligten, City Attorney Developer: TNHC SAN JUAN LLC, a Delaware limited liability company By: The New Home Company Southern California LLC, a Delaware limited liability company Its : Manager BY: Name: rd'-� ;V/ra- Title: Authorized Signatory Association: Oliva Maintenance Corporation a California nonprofit mutual benefit corporation By: Name: a.. -r . M-;L10?2, Title: On� iaeP7 By: " r Name: Title: 14 PUBLIC AGENCY FORM OF ACKNOWLEDGEMENT State of California ) County of Orange ) as. City of San Juan Capistrano ) (Gov't Code 40814&Civil Code 118 1) On September 24, 2014, before me, Maria Morris, City Clerk, personally appeared Sam Allevato. Mayor and Hans Van Listen, City Attorney, who proved to me on the basis of satisfactory evidence to the be person(s)whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity,and that by his/hedthere signature on the instrument the person(s),or the entityupon behalf of which the person(s) acted, executed the instrument . I certify under PENALTY OF PERJURY uJES the laws of the State of California that the foregoing paragraph is true and correct. % (SEAL) W TI y nd and official seal. I Maria I Cit kcIerk OPTIONAL Capacity Claimed by Signers Description of Attached Document Title or Type or Document Mayor and City Attorney Agreement Establishing Soils Subsidence Remediation Program(Oliva) Title Signers are Representing City of San Juan Capistrano STATE OF CALIFORNIA ) COUNTY OF ORANGE ) On 201 , before me, Ine t i D" j Name and Title of Officer personally appeared )(7 (Y1 `�C��%l�Z who proved to me on the basis of satisfactory evidence to be the person(s) whose name (s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signature (s) on the instrument, the person(s) or the entity upon behalf of which the person(s) acted executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. LONI MICHEL nature of NotaryPublic 'a u Commissian•2030519 z Notary Publlo California Orange County UE�My Comm.Ea Ires Ju120,2017 SEAL) 15 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) On has 2014 , before me, LN2{ \U I(&O L, hl(�Act Y 160(( ( 1�,,'� N me and Titled Mite personally appeared �.WnQ�, \, 1c�(�I�r, '� Lbmka& vircacord who proved to me on the basis of satisfactory evidence to be the person(s) whose name (s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in hie/her/their authorized capacity(ies) , and that by his/her/their signatures) on the instrument, the person(s) or the entity upon behalf of which the person(s) acted executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. LONIMICHEL Commission#2030519 i Notary Public-California i nature of Notary Public Orange Courcy M Comm.Expires Jol 20,2017 (SEAL) .-21317.rcn 070214 16 STATE OF CALIFORNIA ) COUNTY OF ORANGE ) On 201_, before me, Name and Title of Officer personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name (s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) , and that by his/her/their signature (s) on the instrument, the person(s) or the entity upon behalf of which the person(s) acted executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal . Signature of Notary Public (SEAL) 17 EXHIBIT "A" LEGAL DESCRIPTION OF THE PROPERTY The Property is more particularly described as that certain real property located in the City of San Juan Capistrano, County of Orange, State of California, more generally described as: Tract No. 17713, in the City of San Juan Capistrano, State of California, as per map recorded in Book , Pages through , inclusive, of Miscellaneous Maps, in the Office of the County Recorder of said County. 18 EXHIBIT "B" DEFINITIONS The defined terms set forth below shall have the definitions given to them herein: "Amended Ordinance" shall have the meaning given to such term in Paragraph B of the Recital to the Agreement. "Amending Resolution" shall have the definition given to such term in Paragraph C of the Recitals to the Agreement. "Association" shall mean Oliva Maintenance Corporation, a California nonprofit mutual benefit corporation. "Authorized Monies" shall have the meaning given to it in Section 6 .3 of the Agreement. "Board" shall mean the Board of Directors of the Association. "City" means the City of San Juan Capistrano, California. "Claims Adjuster" shall have the meaning given to such term in Section 4 .2 of the Agreement. "Common Area" shall have the meaning given it in Preamble Paragraph A. "Council" shall have the meaning given to it in Paragraph "B" of Recitals of the Agreement . "Covered Repairs" shall mean repair of damage to Lots, structures, Common Area or public/private improvements necessitated by Soils Subsidences. "Covered Slopes" means certain slopes described in Section 2 .5 of the Agreement and shown on Exhibit "C" attached hereto. "Declaration" shall have the meaning given to it in Paragraph "E" of Recitals of the Agreement. "Developer" means TNHC SAN JUAN LLC, a Delaware limited liability company and its successors (as described in Section 9.10) . "Developer Repair Period" shall have the meaning given it in Section 2 .2 . "Developer Repair Period Security" shall have the meaning given it in Section 6 . 1. 19 "Director" shall have the meaning given to it in Section 6 .3 of the Agreement. "Effective Date" is defined in the first paragraph of this Agreement. "Geologic Hazard Assessment District" or "GHAD" has the meaning given it in Section 2 .3 (b) . "Long-Term Covered Repair" shall have the meaning given it in Section 2 .3 (a) . "Lot" or "residential Lot" shall have the meaning given it in Preamble Paragraph A. "Project Fund Amount" means $23, 543 . 10, which is 75%5 of the fully-funded Surficial Soils Subsidence Fund balance. "Property" means that certain real property more particularly described on Exhibit "A" attached hereto. "Soils Subsidence" is defined in San Juan Capistrano Municipal Code Section 9.3- 545 (c) (2) (A) as a catastrophic displacement of a Covered Slope at a depth up to three feet with a vertical movement of one foot or more, regardless of cause. Soils Subsidence does not include surface cracking and fissures, including desiccation cracks, or erosion (defined as the wearing away of surface of the slope, as opposed to movement of the slope, resulting from the force of water, wind, persons, or vehicles moving over the surface, unless erosion ultimately results in displacement) . Surficial damage shall be considered catastrophic if due to the extent of movement, funds in the Surficial Soils Subsidence Fund are not sufficient to repair the damage. "Soils Subsidence Remediation Program" shall have the meaning given to it in Paragraph C of the Recitals . "Soils Subsidence Remediation Period" means the period of time commencing on the Effective Date and ending on the 10th year thereafter. "Surficial Soils Subsidence Fund" is defined in Section 2 .4 of this Agreement. The fully-funded balance of the Surficial Soils Subsidence Fund is $31, 390.80, which is attributable to 104, 636 square feet of Covered Slopes at the City-determined reserve amount of $0.30 per square foot of Covered Slopes . 20 EXHIBIT "C" COVERED SLOPES 21 Exhibit C HOA MAINTAINED SLOPES & SLOPES GREATER THAN 5' IN HEIGHT TRACT 17713 TR V655 LOTS 1-9 TR 17773 LOTS 1.22 TR 16146 LOTS 23-31 TR 16146 --� -- ® LOTS 2339 z - -'`--- - - TR 177!3 LOTS 1.22 LEGEND ® TRACT 17713 104.636 SO. FT. NOTE': THE DEPICTIONS HEREON ARE FOR ILLUSTRATIVE PURPOSES ONLY AND THE AS—BUILT CONDITION BY DECLARANT SHALL BE CONTROLLING P OTTEC BY: uonor je sw DATE .w 30. 1014 059}V au -i_E E\0730\.E+q�n e•mq\SF_1£t46\Exp HW\Exn C_'7713-Sopes.o.q 1 EXHIBIT "D" NOTICE OF CLAIM FOR LONG-TERM COVERED REPAIR OLIVA NOTICE OF CLAIM UNDER SOILS SUBSIDENCE REMEDIATION PROGRAM TO: FROM: CLAIMS ADJUSTER (Name) (Name) (Address) (Address of Claim Property) (City, ZIP) (Mailing Address if different from above) (Phone) This Notice of Claim is made in accordance with the terms of the Agreement Establishing Soils Subsidence Remediation Program ("Slope Agreement") governing the remediation of certain Covered Slopes in the Oliva community in the City of San Juan Capistrano. Owners are advised that the Soils Subsidence Remediation Program applies only to "Covered Slopes" identified on Exhibit C to the Slope Agreement. Claims for damage unrelated to Covered Slopes, Claims otherwise found to be outside the coverage of the Slope Agreement, and Claims for damage found to be caused by the Owner through negligence or willful act will be rejected. Owner agrees to cooperate with requests for entry made by the Claims Adjuster, Developer and GRAD personnel (as applicable) in connection with the investigation of this Claim and any and all remediation work that may be ordered in connection therewith. Capitalized terms used in this Notice of Claim are defined in the Slope Agreement, if not otherwise defined herein. The above-named Owner hereby requests the Claims Adjuster to investigate, allocate responsibility for, and adjust the following claim in connection with a "Soils Subsidence, " as defined in San Juan Capistrano Municipal Code Section 9.3-545 (c) (2) (A) . Description of Claim (attach extra pages, including damage estimates, if necessary) : Location of Claimed Damage (attach extra pages or maps if necessary) : 22