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HomeMy WebLinkAbout04926 - PALM HILLS DEVELOPMENT AGREEMENT 4 DA4 ORDINANCE NO. 1741 AN ORDINANCE OF THE CITY OF PALM SPRINGS, CALIFORNIA, VACATING, RESCINDING, REPEALING AND OTHERWISE SETTING ASIDE APPROVAL OF ORDINANCE NOS. 1657 AND 1658 RELATING TO THE PALM HILLS PROJECT. City Attorney's Summary This ordinance vacates, rescinds, repeals and otherwise sets aside approval of Ordinance Nos. 1657 and 1658 relating to the Palm Hills project. THE CITY OF PALM SPRINGS, CALIFORNIA, DOES HEREBY ORDAIN: SECTION 1. Ordinance No. 1657 approving a change of zone relating to the Palm Hills project is hereby vacated, rescinded, repealed and otherwise set aside. SECTION 2. Ordinance No. 1658 approving the development agreement relating to the Palm Hills project is hereby vacated, rescinded, repealed and otherwise set aside_ SECTION 3. The Council finds that this Ordinance is in furtherance of a determination of the voters of the City of Palm Springs at an election held and conducted in March 8, 2005 and, consistent with the provisions of Charter Section 315(a) can be adopted at the time of introduction and will become effective at the time of adoption. SECTION 4. The Mayor shall sign and the City Clerk shall certify to the passage and adoption of this Ordinance and shall cause the same, or the summary thereof, to be published and posted pursuant to the provisions of law and this Ordinance shall take effect upon adoption. PASSED, APPROVED, AND ADOPTED THIS 2No DAY OF APRIL, 2008_ STEPHEN P. POLIGNET, OR ATTEST: AMES THOMPSON, CITY CLERK oS� x Ordinance No. 1741 Page 2 CERTIFICATION STATE OF CALIFORNIA ) COUNTY OF RIVERSIDE ) ss. CITY OF PALM SPRINGS ) I, JAMES THOMPSON, City Clerk of the City of Palm Springs, do hereby certify that Ordinance No. 1741 is a full, true and correct copy, and was adopted at a regular meeting of the Palm Springs City Council on the 2"0 day of April, 2008, by the following vote: AYES: Councilmember Hutcheson, Councilmember Mills, Councilmember Weigel, Mayor Pro Tern Foat and Mayor Pougnet. NOES: None. ABSENT: None. ABSTAIN: None. /J. mes Thompson, City Clerk _.r /�p(�dp� City of Palm Springs, California P DOC a 20®5--O2G1328 04/04/2005 08:00R Fee:NC Page 1 of 45 Recorded in official Records County of Riverside Larry W. Ward , County Clerk & Recorder RECORDING REQUESTED BY AND WHEN RECORDED,MAIL TO: ��NIII11111 II Ell III 1111111 ) CITY CLERK ) M S U PAGE E DA PCDR NOCCR MF MISG City of Palen Springs ) Post Office Box 2743 ) Ll Palm Springs, California 92263 ) °' A R L OCPY LONG REFUND NCNG FRAM Palm Hills Land Corp. Development Agr. #4 AGREEMENT #4926 Ord 1658, 7-21-04 f V DEVELOPMENT AGREEMENT between THE CITY OF PALM SPRINGS ("City") and PALM HILLS LAND CORP. A California corporation ("Developer") Designated As "Development Agreement No. 4" or "DA4" f RECORDING REQUESTED BY ) AND WHEN RECORDED, MAIL TO: ) CITY CLERK ) City of Palm Springs ) Post Office Box 2743 ) Palm Springs, California 92263 ) DEVELOPMENT AGREEMENT between THE CITY OF PALM SPRINGS ("City") and PALM HILLS LAND CORP. A California corporation ("Developer") Designated As "Development Agreement No. 4" or "DA4" DEVELOPMENT AGREEMENT THIS DEVELOPMENT AGREEMENT (this "Development Agreement" or this "Agreement") is entered into on 12004, by the CITY OF PALM SPRINGS (the "City"), a municipal corporation, and PALM HILLS LAND CORP., a California corporation(the "Developer")pursuant to Article 2.5 of Chapter 4 of Division 1 of Title 7, Sections 65864 through 65869.5 of the California Government Code.The City and Developer shall be referred to within this Development Agreement jointly as the"Parties" and individually as a"Party." RECITALS: A. Capitalized Terms. The capitalized terms used in these recitals and throughout this Agreement shall have the meaning assigned to them in Section 1.Any capitalized terms not defined in Section I shall have the meaning otherwise assigned to them in this Agreement or apparent from the context in which they are used. B. Development of Property. The City approved the following land use approvals: (1) General Plan Amendment, Case No. 5-0732,(2)Palm Hills Specific Plan(Planning Area#1),Case No. 5-0732, (3) Planned Development District No. 258, Case No. 5-0826-PD-258, (4) Tentative Parcel Map 29101, and (5) Tentative Tract Map 29100 for the development of approximately 900 acres more or less in the southeastern portion of Palm Springs (the "PDD Area") and at the same time certified the Environmental Impact Report No. 98061043 by Resolution No.20993 Developer has a legal or equitable interest in a portion of the PDD Area as described in Exhibit "A" (the "Developer's Property"). C. Legislation Authorizing Development Agreements.To strengthen the public planning process,encourage private participation in comprehensive planning and reduce the economic risk of development,the legislature of the State of California adopted the Development Agreement Statute, Sections 65864, of seq., of the Government Code, authorizing City to enter into an agreement with any person having a legal or equitable interest in real property providing for the development of such property and establishing certain development rights therein. The legislative findings and declarations underlying the Development Agreement Statute and the provisions governing contents of development agreements state,in Government Code Sections 65864(c)and 65865.2,that the lack of public facilities, including, but not limited to, streets, sewerage, transportation, drinking water, school, and utility facilities is a serious impediment to the development of new housing, and that applicants and local governments may include provisions in development agreements relating to applicant financing of necessary public facilities and subsequent reimbursement over time. D. Intent of the Parties. Developer and City have determined that the Project is a development for which a development agreement is appropriate. The parties desire to define the parameters within which the obligations of Developer for infrastructure and public improvements and facilities will be met, and to provide for the orderly development of the Developer's Property, assist in attaining the most effective utilization of resources within the City, and otherwise achieve the goals of the Development Agreement Statute. In consideration of these benefits to the City and the public benefits of the development of the Developer's Property, Developer will receive #31284 v6-Development Agreement-Palm Hills 1 assurances that the City shall grant all permits and approvals required for total development of the Developer's Property in accordance with this Agreement. E. Public Benefits of Project.The grant of development rights hereunder is consideration for Developer's good faith efforts to complete the development of a multi-million dollar destination resort project composed of(1)an 18-hole championship golf course and clubhouse, (2)a maximum of 129-164 custom residential estates, (3) a maximum of 382 vacation ownership units, and (4) a maximum of 351 room hotel, as described in the PDD. The project as approved by the PDD is hereinafter referred to as the"Project." The Project will benefit the City by creating new jobs in the community,will aid in the revitalization of the tourist trade, and will create a residential area of the highest quality and unique in the desert. The Project will pay all City development fees, including Quimby park fees,which will assure that all costs of the Project will be mitigated. Moreover,to the extent timeshare units are being developer in lieu of hotel units and to pay for certain infrastructure improvements and to pay for landscaping, lighting and other public maintenance expenses, Developer agrees that a Financial Impact Mitigation Fee("FIM Fee") shall be paid to the City, as described herein and in the Declaration attached to the DDA as Exhibit F. Finally,the public benefit of the Project includes the receipt of certain tax revenues. When all phases are developed, the Project will have a net economic benefit to the City of approximately$1,500,00 to $1,600,000 per year. The residential component provides approximately$300,000 to$400,000 in property taxes and the hotel/vacation ownership units provide the remaining$1,300,000 in forecast property tax, sales tax and transient occupancy tax. F. Public Hearings: Findings. In accordance with the requirements of the California Environmental Quality Act(Public Resources Code Sections 21000,et seq.("CEQX)),appropriate studies, analyses,reports or documents were prepared and considered by the Planning Commission and the City Council. The Planning Commission, after a public hearing on May 26, 2004, recommended,and the City Council,after making appropriate findings,certified,by Resolution No. 20993 adopted on July 7,2004 a Final Environmental Impact Report for the Project in compliance with CEQA,more specifically identified as the"Palm Hills Land Corp.Development District Final Environmental Impact Report", State Clearinghouse No. 98061043, Case No. 5-0826-PD-258 (the "EIR") .On May 26,2004,the Planning Commission of the City(the"Planning Commmission"),after giving notice pursuant to Government Code Sections 65090,65091,65092 and 65094,held a public hearing on Developer's application for this Agreement. On July 7, 2004, the City Council, after providing public notice as required by law,held a public hearing to consider Developer's application for this Agreement. The Planning Commission and the City Council have found on the basis of substantial evidence that the Agreement is consistent with all applicable plans,rules,regulations and official policies of the City. G. Mutual Agreement. Based on the foregoing and subject to the terns and conditions set forth herein, Developer and City desire to enter into this Development Agreement. NOW, THEREFORE, in consideration of the mutual promises and covenants herein contained, and having determined that the foregoing recitals are true and correct and should be and hereby are incorporated into this Agreement, the parties agree as follows: 1. DEFINITIONS #3I284 v6-Development Agreement-Palm Hills 2 The following words and phrases are used as defined terms throughout this Development Agreement. Each defined term shall have the meaning set forth below. 1.1 Applications. The tern "Application(s)" shall mean a complete application for the applicable land use approvals (such as a subdivision map, planned development district, etc.) meeting all of the current ordinances of the City provided that any additional or alternate requirements in said ordinances enacted after the Effective Date which affect the Project application shall apply only to the extent permitted by this Agreement. 1.2 Approved Master Parcel Map. "Approved Master Parcel Map"shall mean a master parcel map which has been approved by the City in accordance with the California Subdivision Map Act establishing fourteen(14)parcels for financing purposes only consistent with the PDD. 1.3 Approved Master Tentative Map. "Approved Master Tentative Map"shall mean a master tentative map which has been approved by the City in accordance with the California Subdivision Map Act showing a resort and residential project consistent with the PDD. 1.4 Approved Specific Plan. The"Approved Specific Plan"shall mean the Palm Hills Specific Plan No. 1 as prepared by The Keith Companies,Planning Consultants,and approved by the City. 1.5 Assignment. All forms of use of the verb "assign"and the nouns "assignment' and "assignee" shall include all contexts of hypothecations, sales, conveyances, transfers, leases, and assignments. - 1.6 Authorizing Ordinance. The"Authorizing Ordinance"means Ordinance No. 16-58 approving this Development Agreement. 1.7 The Ci . The "City"means the City of Palm Springs, California. 1.8 City Council. The "City Council' means the governing body of the City of Palm Springs. 1.9 City Development Agreement Ordinance. The "City Development Agreement Ordinance" means Section 9408 of the Zoning Ordinance which establishes a procedure for the consideration and approval of development agreements pursuant to the Development Agreement Statute. 1.10 Claims or Litigation. The term "Claims or Litigation"shall mean any challenge by adjacent owners or any other third parties(i)to the legality,validity or adequacy of the General Plan, Land Use Regulations, this Development Agreement, Development Approvals, or other actions of Citypertaining to the Project,or(ii)seeking damages against City as a consequence of the foregoing actions or for the taking or diminution in value of their property, or in any other manner. 1.11 Default.A"Default'refers to anymaterial default,breach,orviolation of a provision of this Development Agreement as defined in Section 11.A"City Default'refers to a Default by the City, while an "Developer Default'refers to a Default by Developer. #31284 v6-Development Agreement-Palm Hills 3 1.12 Development. "Development"means the improvement of the Developer's Property for purposes of effecting the structures, improvements and facilities comprising the Project including,without limitation: grading,the construction of infrastructure and public facilities related to the Project whether located within or outside the Developer's Property; the constriction of structures and buildings; and the installation of landscaping; but not including the maintenance, repair, reconstruction or redevelopment of any structures, improvements or facilities after the construction and completion thereof. 1.13 Development Agreement Statute. The "Development Agreement Statute" means Sections 65864 through 65869.5 of the California Government Code as it exists on the Development Agreement Date. 1.14 Development Approvals."Development Approvals"means all site-specific(meaning specifically applicable to the Developer's Property only and not generally applicable to some or all other properties within the City) plans, maps, permits, and entitlements to use of every kind and nature. Development Approvals includes, but is not limited to, specific plans, site plans, tentative and final subdivision maps, vesting tentative maps, variances, zoning designations, planned unit developments,conditional use permits,grading,building,and other similar permits,the site-specific provisions of general plans,environmental assessments,including environmental impact reports,and any amendments or modifications to those plans,maps,permits, assessments and entitlements.The term Development Approvals does not include rules,regulations,policies,and other enactments of general application within the City. 1.15 Development Plan. The "Development Plan" means the Existing Development Approvals, Future Development Approvals and Existing Land Use Regulations. 1.16 Effective Date. The "Effective Date" means the date the Agreement becomes effective as set forth in Section 3.2. 1.17 Exaction."Exaction"means dedications of land,payment of development fees and/or construction of public infrastructure by Developer as part of the Development. The development will be subject to all development and/or in-lieu fees currently in the process ofbeing studied by the City so long as they are adopted prior to issuance of building permits for specific portions of the development proposed herein. The amount of the fees shall be as required at the time of issuance of building permits. 1.18 Existing Development Approvals.The"Existing Development Approvals"means only the Development Approvals which are listed on Exhibit "C". 1.19 Existing Land Use Regulations. The"Existing Land Use Regulations"means those certain Land Use Regulations applicable to the Property in effect on the Effective Date. 1.20 Future Development Approvals. "Future Development Approvals" means those Development Approvals applicable to the Property approved by the City after the Effective Date such as tentative tract maps,subdivision improvement agreements and other more detailed planning engineering approval requirements. #31284 v6-Development Agreement-Palm Hills 4 1.21 Land Use Regulations. The"Land Use Regulations"means those ordinances, laws, statutes,rules,regulations,initiatives,policies,requirements,guidelines,constraints, codes or other actions of the City which affect, govern, or apply to the Property or the implementation of the Development Plan.Land Use Regulations include the ordinances and regulations adopted by the City which govern permitted uses of land, density and intensity of use and the design of buildings, applicable to the Property, including, but not limited to, the General Plan, specific plans, zoning ordinances, development moratoria, implementing growth management and phased development programs, ordinances establishing development exactions, subdivision and park codes, any other similar or related codes and building and improvements standards,mitigation measures required in order to lessen or compensate for the adverse impacts of a project on the environment and other public interests and concerns or similar matters. The term Land Use Regulations does not include, however, regulations relating to the conduct of business, professions, and occupations generally; taxes and assessments; regulations for the control and abatement of nuisances; building codes; encroachment and other permits and the conveyances of rights and interests which provide for the use of or entry upon public property, any exercise of the power of eminent domain; or similar matters. 1.22 Legal or Equitable Interest. The term"legal or equitable interest" shall mean(i) an option as evidenced by a recorded memorandum of option,and appropriate title insurance issued in favor of Developer, or (ii) fee title evidenced by appropriate title insurance issued in favor of Developer. 1.23 Mortgage. "Mortgage" means a mortgage, deed of trust, or sale and leaseback arrangement or other transaction in which all or anyportion of or interest in the Developer's Property is pledged as security. 1.24 Mortgagee."Mortgagee"refers to the holder of a beneficial interest under a Mortgage. 1.25 Developer."Developer"means Palm Hills Land Corp.,a California corporation,and any permitted assignee in accordance with Section 12. 1.26 Developer's Property. The"Developer's Property"means that real property shown and described on Exhibit"A" in which Developer currently holds a legal or equitable interest. 1.27 Planned Development District or PDD. The "Planned Development District" or "PDD"means the zoning designation of the City of Palm Springs designed to provide for compatible land uses within a planned development as specifically approved by the City for the Project under Planned Development District No. 258 on July 7, 2004 by Resolution No. 20993. 1.28 PDD Area.The"PDD Area"means all that real property which is subject to the PDD. 1.29 Phase or Phases.The term"Phase"or"Phases"or references to a specific Phase shall mean those portions of the Project as designated in the Phasing Plan summarized on Exhibit`B." 1.30 Phasing Plan. The tern "Phasing Plan" shall mean the phasing plan for the Project summarized on Exhibit`B". #31284 v6-Development Agreement-Palm Hills 5 1.31 Pluming Director. "Planning Director" shall mean the Director of Planning and Zoning or similar officer of City. 1.32 Project.The"Project"means the development of the Developer's Property pursuant to the Development Plan and this Agreement. 1.33 Reservations of Authority. The term "Reservation of Authority" shall have the meaning set forth in Section 9 of this Agreement. 1.34 Tenn. The "Term" means that period of time during which this Development Agreement shall be in effect and bind the Parties, as defined in Section 3.1. 1.35 Financial Impact Mitigation Fee. The term"FIM Fee"shall mean the fee described in Exhibit F which shall be paid on timeshare intervals so that these units contribute to the payment for City services as would hotel units. In addition the FIM Fee will pay for Project costs including infrastructure costs, payment for maintenance of public landscaping, lighting and improvements, access to trails on City property, and to pay for other service enhancements and obligations of the Developer. 2. EXHIBITS. The following are the Exhibits to this Agreement: Exhibit A: Map and Legal Description of the Developer's Property Exhibit B: Phase Plan Exhibit C: Existing Development Approvals Exhibit D: Estoppel Certificate Exhibit E: Summary of Fees,Taxes and Assessments Existing as of the Effective Date or in progress and adopted prior to issuance of a building permit Exhibit F: Financial Impact Mitigation Fee 3. TERM. 3.1 Tenn.The term of this Development Agreement(the"Tenn")shall commence on the Effective Date and shall continue for a period of fifteen (15) years ("Original Term") unless otherwise expressly provided by this Agreement. 3.2 Effective Date.This Agreement shall become effective upon the date thirty(30)days after the adoption of the Authorizing Ordinance. 4. DEVELOPMENT OF THE DEVELOPER'S PROPERTY. #31284 v6-Development Agreement-Palm Hills 6 4.1 Right to Develop. During the Term, Developer shall have a vested right to develop the Developer's Property (subject to Section 5 below) to the full extent pennitted by the Development Plan and this Development Agreement. Except as provided within this Development Agreement, the Development Plan shall exclusively control the development of the Property (including the uses of the Property, the density or intensity of use,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 Project). 4.2 Existing Development Approvals. Only those items specifically set forth on Exhibit"C"hereto are deemed Existing Development Approvals for purposes of this Agreement. Any approvals not included within Exhibit"C"shall not apply to the Project with the exception of those reservations set forth in Section 9 below. 4.3 Obligation of City Respecting Financing.Nothing to the contrary in this Agreement withstanding, the Developer shall have the right to request City to commence proceedings to consider forming assessment, benefit,maintenance or other districts (including without limitation Mello-Roos Community Facilities Districts)under applicable laws to pay for the costs and expenses associated with the Public Improvements or any of them and if in the exercise of its sole and absolute discretion the City elects to so form a district,City shall issue or cause to be issued project bonds of such district in an amount to be detennined by City. The Developer may request City to consider utilizing any other financing method then available under applicable laws; provided that in connection with any such request relating to any other financing method, City shall give due consideration to utilization of the requested other financing method, taking into account the requirements of applicable laws, and the benefit to be derived with respect to development of the Project of such public financing methods as they relate to reduction in cost of development of the Project and the enhancement thereof to achieve the intent of the parties hereunder.If,after such good faith consideration as aforesaid,City in its sole discretion decides to provide such public assistance, then City agrees to use its best efforts to take all actions as may be necessary or appropriate in order to do so, and the Developer shall cooperate in connection therewith. The City makes no representation to Participant that project bonds may be issued respecting this Project and/or the amount of same due to a number of potential legal issues, including but not limited to, that if any portion of the underlying real property interest is a leasehold interest on Indian land then upon a default under the leasehold, the fee interest may not be subject to the applicable requirements. Furthermore,Developer understands and agrees that nothing herein shall be construed to require City to issue general obligation bonds, or to pledge its full faith and credit to any bond issues. 4.4 Obligations of Developer Respecting Financing. Except as specifically provided herein, it is expressly understood that developer is fully responsible for the cost of the Project and obtaining any necessary construction or long term financing therefore. 4.5 Later Enacted Measures. This Development Agreement is a legally binding contract which will supersede any initiative, measure, moratorium, statute, ordinance, or other limitation enacted after the Effective Date, except as provided in Section 9 and/or in Exhibit E. Any such enactment which affects, restricts, impairs, delays, conditions, or otherwise impacts the implementation of the Development Plan (including the issuance of all necessary Future Project #31284 v6-Development Agreement-Palm Hills 7 Approvals or permits for the Project)in anyway contrary to the terms and intent of this Development Agreement shall not apply to the Project unless otherwise provided by State law. 5. TIME FOR CONSTRUCTION AND COMPLETION OF PROJECT. 5.1 Right of Developer to Control Timing. Developer cannot fully predict the timing, phasing,or sequencing in which the Project will be developed,if at all. Such decisions depend upon numerous factors,many of which are not completely within the control ofDeveloper,such as market orientation and demand,interest rates,absorption,completion,and the state of the general economy. Therefore, Developer may decide, subject to meeting the specific requirements of Exhibit B, the timing, phasing, and sequencing of the Project. In addition, although Developer will develop the minimum number of units as specified in Exhibit B,Developer may reduce the number of vacation ownerships and hotel units below the maximum provided for herein if Developer can demonstrate to City's satisfaction,based on independent economic analysis,that the$1.3M revenue projection to the City will be met from the reduced number of hotel/vacation units (in 2004 dollars). 5.2 Timing Constraints to Development Plan. The Phasing Plan sets forth Developer's present plan for the development of the Project. Although Developer may modify the timing, phasing and sequencing of the Project and amend the Phasing Plan accordingly, in all events, the Project will be undertaken consistent with the following timing constraints: (a) Developer will submit a completed Application for a final planned development district for Phase I within two(2)years of the Effective Date;provided, however, that said time limit shall be extended by the amount of time that the Original Term is extended pursuant to Section 3.1. (b)Developer willcommence construction of Phase I(Golf Course) and the thirty(30)units of Phase 11(Single Family—East)within five(5)years of Effective Date of this Agreement. (c) Developer shall commence construction of Phase IIIB (Hotel/Vacation Ownership)of two hundred(200)units for hotel one hundred and five(105)units for vacation ownership within five(5) years of the Effective Date of this Agreement. (d)Developer shall commence construction of remaining phases(Phase IIIA, Phase IV)within the term of this Agreement. (e)The timing constraints for construction ofpublic improvements shall be as provided in Section 5.3. (f)Any construction which is commenced shall be completed in accordance with the terms of the permit which is issued. 5,3 Public Improvements.The parties understand and agree that PDD identifies the public infrastructure but does not specify precisely the phasing of the public infrastructure.The City desires that required public infrastructure generally be constructed in the early phases of the development cycle subject to the guidelines specified below. In consideration of the foregoing, notwithstanding #31284 v6-Development Agreement-Palm Hills 8 any provision herein to the contrary,the City shall retain the right to condition any Future Approvals to require Developer to dedicate necessary land for public improvements,pay the development fees specified in Section 6, and/or to construct the required public infrastructure ("Exactions") at such time as City shall determine subject to the following conditions: (a) The dedication, payment or construction must be to alleviate an impact caused by the Project or be of benefit to the Project; and (b)The timing of the Exaction should be reasonably related to the phasing of the development of the Project and said public improvements shall be phased to be commensurate with the logical progression of the Project development as well as the reasonable needs of the public and completed based upon the needs of the public existing from time to time. When Developer is required by this Development Agreement and/or the Development Plan to construct any public works facilities which will be dedicated to the City or,any other public agency upon completion and if required by applicable laws to do so,Developer shall perform such work in the same manner and subj ect to the same construction standards as would be applicable to the City or such other public agency should it have undertaken such construction work. 6. FEES. TAXES AND ASSESSMENTS. The City shall not, without the prior written consent of Developer, impose any additional fees, taxes or assessments on all or any portion of the Project, whether as a condition to a Future Development Approval or otherwise,except such fees,taxes and assessments as are described in or required by this Development Agreement and/or the Development Plan. The amount of the fees, taxes and assessments shall be that amount in effect at the time said fee, tax or assessment is due. For example,development fees are typically paid at the time building permits are issued. Therefore, the amount of the fees shall be based on the fee schedule at that time. This Development Agreement shall not prohibit the application of fees, taxes or assessments as follows: (a)Developer shall be obligated to pay those fees,taxes or assessments which exist as of the Effective Date and any increases or decreases in same as adopted by the City Council and imposed on a city-wide basis. A list of the fees, taxes and assessments in effect in the City as of the Effective Date are set forth on Exhibit"E" attached hereto. (b)Developer shall be obligated to pay any fees or taxes imposed on a City- wide basis which are not related to construction or development activities such as business license fees or taxes and utility taxes. (c) Developer shall be obligated to pay all fees applicable to a permit application as.charged by the City at the time such application is filed by Developer. (d) Developer shall be obligated to pay any new fees, taxes or assessments which are imposed on a city-wide basis or area-wide basis such as a utility tax, landscape or lighting assessment,or a community services assessment so long as the #31284 v6-Development Agreement-Palm Hills 9 tax,fee or assessment was not directed exclusively or even primarily against owners, lessees, businesses, residents or occupants of the Project. (e) Developer shall be obligated to pay any fees as imposed pursuant to any assessment district established within the Project otherwise proposed or consented to by Developer. (f) Developer shall be obligated to pay any fees which were imposed as conditions of approval in the PDD, Specific Plan,Mitigation Monitoring Program or any other condition or mitigation measure, required as part of the approval for Existing or Future Development Approvals. (g) Developer shall be obligated to pay all recently enacted planning department processing and development fees based upon the fee study prepare by City, as well as City's new Quimby fees for park purposes, as enacted pursuant to Park Fee Ordinance No. 1632. (n) City may form a Community Facilities District under authority of Governmental Section 53311 et. seq.. or other appropriate. 7. PROCESSING OF REOUESTS AND APPLICATIONS: OTHER GOVERNMENT PERMITS. 7.1 Processin>T.In reviewing Future Development Approvals which are discretionary,the City may impose only those conditions, exactions, and restrictions which are allowed by the Development Plan and this Development Agreement.Upon satisfactory completion by Developer of all required preliminary actions, meetings, submittal of required information and payment of appropriate processing fees, if any, the City shall promptly commence and diligently proceed to complete all required steps necessary for the implementation of this Development Agreement and the development by Developer of the Project in accordance with the Existing Development Approvals. In this regard, Developer, in a timely manner, will provide City with all documents, applications, plans and other information necessary for the City to carry out its obligations hereunder and will cause Developer's planners, engineers and all other consultants to submit in a timely manner all required materials and documents therefor. It is the express intent of this Development Agreement that the parties cooperate and diligently work to implement any zoning or other land use, site plan, subdivision, grading,building or other approvals for development of the Project in accordance with the Existing Development Approvals.Notwithstanding the foregoing,nothing contained herein shall be construed to require City to process Developer's applications ahead of other projects in process in the City and City's obligations hereunder shall be subject to the City's workload and staffing at any given time. If Developer elects, in its sole discretion, to request the City to incur overtime or additional consulting services to receive expedited processing by the City, Developer shall pay all such overtime costs, charges or fees incurred by City for such expedited processing. 7.2 Tentative Subdivision Maps.The City shall extend through the Term hereof(pursuant to Government Code Section 66452.6)all Tentative Subdivision Maps applied for by Owner during the term of this Agreement and approved by the City in the future. #31284 v6-Development Agreement-Palm Hills 10 7.3 Phased Final Maps.Developer may file as many phased final maps for the Project as it deems appropriate and consistent with this Agreement. 7.4 Other Governmental Permits.Developer shall apply in a timelymanner for such other permits and approvals as maybe required from other governmental or quasi-governmental agencies having jurisdiction over the Project as may be required for the development of, or provision of services to, the Project in accordance with the phasing requirements set forth herein. The City shall cooperate with Developer in its efforts to obtain such permits and approvals. 7.5 Public Agency Coordination. The City and Developer shall cooperate and use reasonable efforts in coordinating the implementation of the Development Plan with other public agencies, if any, having jurisdiction over the Property or the Project. 8. AMENDMENT OF DEVELOPMENT AGREEMENT. 8.1 Initiation of Amendment. Either Party may propose an amendment to this Development Agreement. 8.2 Procedure.Except as set forth in Section 8.4 below,the procedure for proposing and adopting an amendment to this Development Agreement shall be the same as the procedure required for entering into this Development Agreement in the first instance. 8.3 Consent. Except as expressly provided in this Development Agreement, no amendment to all or any provision of this Development Agreement shall be effective unless set forth in writing and signed by duly authorized representatives of each of the parties hereto and recorded in the Official Records of Riverside County. 8.4 Minor Modifications. (a) Implementation of the Project may require minor modifications of the details of the Development Plan and performance of the Parties under this Development Agreement. The Parties desire to retain a certain degree of flexibility with respect to those items covered in general terms under this Development Agreement. Therefore, non-substantive and procedural modifications of the Development Plan shall not require modification of this Development Agreement. (b) A modification will be deemed non-substantive and/or procedural if it does not result in a material change in fees,maximum residential density,minimum number of hotel rooms, maximum intensity of use, permitted uses, the maximum height and size of buildings,the reservation or dedication of land for public purposes, or the improvement and construction standards and specifications for the Project, including density transfers between Phases. (c) Notwithstanding the foregoing, City will process any change to this Development Agreement consistent with state law and will hold public hearings therein if so required by state law and the parties expressly agree nothing herein is intended to deprive any party or person of due process of law. #31284 v6-Development Agreement-Palm Hills 11 8.5 Effect of Amendment to Development Agreement. The Parties agree that except as expressly set forth in any such amendment, an amendment to this Development Agreement will not alter, affect, impair, modify, waive, or otherwise impact any other rights, duties, or obligations of either Party under this Development Agreement. 9. RESERVATIONS OF AUTHORITY. 9.1 Limitations.Reservations and Exceptions.Notwithstanding anything to the contrary set forth hereinabove,in addition to the Existing Land Use Regulations,onlythe following Land Use Regulations adopted by City hereafter shall apply to and govern the Development of the Developer's Property("Reservation of Authority"): (a) Future Regulations. Future Land Use Regulations which (i) are not in conflict with the Existing Land Use Regulations, or (ii) if in conflict with the Existing Land Use Regulations but the application of which to the Development of the Developer's Property has been consented to in writing by Developer. (b) State and Federal Laws and Regulations. Where state or federal laws or regulations enacted after the Effective Date prevent or preclude compliance with one or more provisions of the Development Agreement, those provisions shall be modified, through revision or suspension, to the extent necessary to comply with such state or federal laws or regulations. (c)Public Health and Safety/Uniform Codes. (i) Adoption Automatic Regarding Uniform Codes. This Development Agreement shall not prevent the City from adopting Future Land Use Regulations or amending Existing Regulations which are uniform codes and are based on recommendations of a multi-state professional organization and become applicable throughout the City,such as,but not limited to,the Uniform Building, Electrical, Plumbing, Mechanical, or Fire Codes. (ii) Adoption Regarding Public Health and Safetv/Unif6mr Codes.This Development Agreement shall not prevent the City from adopting Future Land Use Regulations respecting public health and safety to be applicable throughout the City which directly result from findings by the City that failure to adopt such Future Land Use Regulations would result in a condition injurious or detrimental to the public health and safety and that such Future General Regulations are the only reasonable means to correct or avoid such injurious or detrimental condition. (iii)Adoption Automatic Regarding Regional Programs.This Development Agreement shall not prevent the City from adopting Future Land Use Regulations or amending Existing Regulations #31284 v6-Development Agieemeut-Palm Hills 12 which are regional codes and are based on recommendations of a county or regional organization and become applicable throughout the region, such as Coachella Valley Association of Governments. (d) Planned Development District Regulations. Notwithstanding the provisions of Section 5.1,it is recognized by the parties that the Existing Approvals, including the PDD, are generalized and that the City's procedures for approving development involve a more precise and detailed review including final planned development district approval and building plan check review and approval.At these levels of review, site specific criteria are considered, along with factors such as building heights,parking and loading requirements,front yard setbacks,minimum lot frontages, open space requirements and similar matters as specified in applicable portions of the Palm Springs Municipal Code. For example, although the PDD specifies the general location of the hotel and residential subdivision, the City, through its Planning Commission, at the time of the approval process for the final planned development district must approve the exact location with due consideration for topography, geology, compatibility with surrounding property and other constraints. In addition, the City has not fully evaluated the need for or timing of construction of public infrastructure but such requirements by City shall be subject to the restrictions specified in Section 5.3. Therefore, the City retains the right to impose appropriate conditions of approval in granting Future Approvals, consistent with its Existing Land Use Regulations,to further the purposes of this Development Agreement, so long as said Future Approvals permit Developer to construct the Project with the density and intensity of use provided in the PDD, and the Specific Plan and in accordance with this Development Agreement. 9.2 Regulation by Other Public Agencies. It is acknowledged by the parties that other public agencies not within the control of the City possess authority to regulate aspects of the Development of the Developer's Property separately from or jointly with the City and this Development Agreement does not limit the reasonable authority of such other public agencies. 10. ANNUAL REVIEW. 10.1 Annual Monitoring Review. Following commencement of construction, City and Developer shall review the performance of this Agreement,and the Development of the Project,on or about each anniversary of the Effective Date provided that if development does not proceed in accordance with the Phasing Plan(Exhibit B), an earlier monitoring review maybe conducted.The cost of the annual monitoring review shall be borne by Developer.As part of such annual monitoring review, within thirty(30) days after each anniversary of this Agreement,Developer shall deliver to City all information reasonably requested by City(i)regarding Developer's performance under this Agreement demonstrating that Developer has complied in good faith with terns in this Agreement and (ii) as required by the Existing Land Use Regulations. If the City determines that Developer has substantially complied with the terns and conditions of this Development Agreement, the review shall be concluded. If the City finds and determines that Developer has not substantially complied with the terns and conditions of this #31284 v6-Development Agiecment-Palm Hills 13 Development Agreement for the period under review,the City may declare a default by Developer in accordance with Section 11.1. 10.2 Certificate of Compliance.If at the conclusion of aperiodic review the City finds that Developer is in substantial compliance with this Development Agreement, the City shall, upon request by Developer,issue an Estoppel Certificate to Developer in the form shown on Exhibit"D". 10.3 Failure to Conduct Annual Review. The failure of the City to conduct the Annual Review shall not be a Developer Default. 11. DEFAULT, REMEDIES AND TERMINATION. 11.1 Rights of Non-Defaulting Party after Default. The parties acknowledge that both Parties shall have hereunder all legal and equitable remedies as provided by law following the occurrence of a default(as defined in Section 11.2 below)or to enforce any covenant or agreement herein.Before this Agreement maybe terminated or action maybe taken to obtain judicial relief the Party seeking relief("Nondefaulting Party")shall comply with the notice and cure provisions of this Section 11. 11.2 Notice and Opportunity to Cure.A Non-Defaulting Party in its discretion may elect to declare a default under this Development Agreement in accordance with the procedures hereinafter set forth for any failure or breach of the other party("Defaulting Party )to perform anymaterial duty or obligation of said Defaulting Partyunder the terms of this Development Agreement.However,the Non-Defaulting Party must provide written notice to the Defaulting Party setting forth the nature of the breach or failure and the actions, if any, required by Defaulting Party to cure such breach or failure. The Defaulting Party shall be deemed in "default"under this Development Agreement, if said breach or failure can be cured,but the Defaulting Party has failed to take such actions and cure such default within thirty (30) days after the date of,such notice or ten (10) days for monetary defaults (or such lesser time as may be specifically provided in this Agreement). However, if such non-monetary default cannot be cured within such thirty(30) day period, and if and, as long as the Defaulting Party does each of the following: (a)Notifies the Non-Defaulting Party in writing with a reasonable explanation as to the reasons the asserted default is not curable within the thirty(30)day period; (b) Notifies the Non-Defaulting Party of the Defaulting Party's proposed cause of action to cure the default; (c)Promptly commences to cure the default within the thirty(30)day period; (d)Makes periodic reports to the Non-Defaulting Party as to the progress of the program of cure; and (e) Diligently prosecutes such cure to completion, then the Defaulting Party shall not be deemed in breach of this Agreement.Notwithstanding the foregoing,the Defaulting Party shall be deemed in default under this Agreement if said breach or failure involves the payment of money but the Defaulting Party has failed to #31284 v6-Development Agreement-Pahn Hills 14 completely cure said monetary default within ten (10) days (or such lesser time as may be specifically provided in this Agreement) after the date of such notice. 11.3 Waiver of Breach. By recordation of a final map on all or any portion of the Developer's Property, Developer shall be deemed to have waived any claim that any condition of approval of the map is improper or that the map as approved constitutes a breach of the provisions of this Development Agreement. 11.4 Monetary Default. In the event Developer fails to perform any monetary obligation under this Agreement,Developer shall pay interest thereon at the lesser of.(i)ten percent(10%)per annum, or (ii) the maximum rate permitted by law, from and after the due date of said monetary obligation until payment is actually received by City. 11.5 Rights and Duties Following Termination.Upon the termination ofthis Development Agreement, no Party shall have any further right or obligation hereunder except(i)with respect to any obligations to have been performed prior to said termination or with respect to any default in the performance of the provisions of this Development Agreement which has occurred prior to said termination, and(ii)with respect to the indemnity obligations set forth herein. 12. ASSIGNMENT. 12.1 Right to Assign. (a)General.Neither Party shall assign(as hereinafter defined)or transfer(as hereinafter defined) its interests, rights or obligations under this Development Agreement without the prior written consent of the other,which consent shall not be unreasonably withheld or delayed. The term"assignment"as used in this Development Agreement shall include successors-in-interest to the City that may be created by operation of law. Notwithstanding the foregoing,City shall have the right to sell,assign or transfer its interest in any real property dedicated or transferred to City pursuant to the terms of this Development Agreement or to another public agency. As used in this Section, the term"transfer" shall include the transfer to any person or group of persons acting in concert of more than seventy percent(70%)of the present equity ownership and/or more than fifty percent (50%) of the voting control of Developer (jointly and severally referred to herein as the "Trigger Percentages") or any general partner of Developer in the aggregate, taking all transfers into account on a cumulative basis, except transfers of such ownership or control interest between members of the same immediate family, or transfers to a trust,testamentary or otherwise,in which the beneficiaries are limited to members of the transferor's immediate family. A transfer of interests (on a cumulative basis)in the equity ownership and/or voting control of Developer in amounts less than Trigger Percentages shall not constitute a transfer subject to the restrictions set forth herein. In the event Developer or any general partner comprising Developer or its successor is a corporation or trust, such transfer shall refer to the transfer of the issued and 931284 v6-Development Agreement-Palm Hills 15 outstanding capital stock of Developer, or of beneficial interests of such trust;in the event that Developer or any general partner comprising Developer is a limited or general partnership, such transfer shall refer to the transfer of more than the Trigger Percentages in the limited or general partnership interest;in the event that Developer or any general partner is a joint venture, such transfer shall refer to the transfer of more than the Trigger Percentages of such joint venture partner, taking all transfers into account on a cumulative basis. Developer shall not transfer this Agreement or any of Developer's rights hereunder, or any interest in the Developer's Property or in the improvements thereon, directly or indirectly,voluntarily or by operation of law,except as provided below, without the prior written approval of City, and if so purported to be transferred, the same shall be null and void. In considering whether it will grant approval to any transfer by Developer, which transfer requires City approval, City shall consider factors such as(i)the financial strength and capability of the proposed transferee to perform City's obligations hereunder;and(ii)the proposed transferee's experience and expertise in the planning, financing, development, ownership, and operation of similar projects. In addition, no attempted assignment of any of Developer's obligations hereunder shall be effective unless and until the successor party executes and delivers to City an assumption agreement in a form approved by the City assuming such obligations.No consent or approval by City of any transfer requiring City's approval shall constitute a further waiver of the provision of this Section 12.1(a) and furthermore,City's consent to a transfer shall not be deemed to release Developer of liability for performance under this Agreement unless such release is specific and in writing executed by City. The foregoing prohibition shall not apply to any of the following: (i)Anymortgage,deed of trust,sale/lease-back,or other form of conveyance for financing and any resulting foreclosure therefrom. (ii) The granting of easements or dedications to any appropriate governmental agency or utility or permits to facilitate the development of the Developer's Property. (iii) A sale or transfer resulting from or in connection with a reorganization as contemplated by the provisions of the Internal Revenue Code of 1986, as amended or otherwise, in which the ownership interests of a corporation are assigned directly or by operation of law to a person or persons, firm or corporation which acquires the control of the voting capital stock of such corporation or all or substantially all of the assets of such corporation. (iv) A sale or transfer of less than the Trigger Percentages between members of the same immediate family, or transfers to a 431284 v6-Development Agreement-Pahn Hills 16 trust, testamentary or otherwise, in which the beneficiaries consist solely of immediate family members of the trustor or transfers to a corporation or partnership in which the immediate familymembers or shareholders of the transferor who owns at least ten percent(10%)of the present equity ownership and/or at least fifty percent(50%)of the voting control of Developer. (v) A transfer of common areas to a property owner's association. (b) Subject to Terms of Agreement. Following any such assignment or transfer of any of the rights and interests of Developer under this Development Agreement, in accordance with Section 12.1(a) above, the exercise, use and enjoyment shall continue to be subject to the terms of this Development Agreement to the same extent as if the assignee or transferee were Developer. (c) Release of Developer. Upon the written consent of the City to the complete assignment of this Agreement and the express written assumption of the assigned obligations of Developer under this Development Agreement by the assignee,Developer shall be relieved of its legal duty from the assigned obligations under this Development Agreement, except to the extent Developer is in default under the terms of this Development Agreement prior to said transfer. (d)No Approval of Terms of Loan by City.Notwithstanding anything to the contrary set forth herein with regards to the approval by City of hypothecation, encumbrances or mortgages, City shall only have the right to approve the identity of Developer's lender, which approval will not be unreasonably withheld, taking into consideration such lender's financial strength,reputation,and other relevant factors. City shall not have any right to approve any of the terns or conditions of Developer's financing arrangements with third party lenders. 12.2 Sale to Residential Builder. Nothing herein shall prevent Developer from selling a portion of the Property for residential development subject to any approved final subdivision map to a residential builder for construction of houses in accordance with the terns of this Agreement provided that said transferee must enter into appropriate agreements including with City to assure that all development restrictions hereunder, including with regards to timing, will be met. 12.3 Termination of Agreement With Respect to Individual Parcels Upon Sale to Public. Notwithstanding any provisions of this Development Agreement to the contrary,this Development Agreement shall terminate as to any lot which has been finally subdivided and improved with all required public improvements and which is individually(and not in"bulk") sold to an owner-user and thereupon and without the execution or recordation of any further document or instrument such lot shall be released from and no longer be subject to the provisions of this Development Agreement; provided, however, that CC&R's are placed of record in accordance with Section 12.4. 12.4 Declaration of Covenants. Conditions and Restrictions. Prior to the transfer of any portion of the Project to a third party, Developer shall submit a proposed form of Declaration of Covenants,Conditions and Restrictions to be recorded against the applicable subdivision to City for 431284 v6-Development Agreement-Palm Hills 1 its review and approval ("CC&RS"). It is anticipated that said CC&RS will contain, among other things, protective covenants to protect and preserve the integrity and value in the subdivision, including but not limited to use restrictions, maintenance covenants, FIM Fee, EIR mitigation measures,restrictions under this Development Agreement and the PDD which will continue to apply to the subdivision, covenants for construction and completion of the improvements within a time certain, and a provision giving the City the right to enforce said CC&RS. 13. INDEMNITY. 13.1 Third-Party Litigation. (a) Non-liability of City. As set forth above, City has determined that this Agreement is consistent with the General Plan and that the General Plan and Development Approvals meets all of the legal requirements of state law.The parties acknowledge that: (i) In the future there may be challenges to legality, validity and adequacy of the General Plan, the Development Approvals and/or this Agreement; and (ii) If successful, such challenges could delay or prevent the performance of this Agreement and the development of the Property. In addition to the otherprovisions ofthis Development Agreement,including, without limitation,the provisions of this Section 13,City shall have no Iiabilityunder this Development Agreement for any failure of City to perform under this Development Agreement or the inability of Developer to develop the Developer's Property as contemplated by the Development Plan or this Development Agreement as the result of a judicial determination that on the Effective Date, or at any time thereafter,the General Plan,the Land Use Regulations,the Development Approvals, this Development Agreement,or portions thereof,are invalid or inadequate or not in compliance with law. (b) Revision of Land Use Restrictions. If for any reason the General Plan, Land Use Regulations,Development Approvals,this Development Agreement or any part thereof is hereafter judicially determined as provided above to be not in compliance with the State or Federal Constitutions, laws or regulations and if such noncompliance can be cured by an appropriate amendment thereof otherwise conforming to the provisions of this Agreement, then this Development Agreement shall remain in full force and effect to the extent pennitted by law.The Development Plan,Development Approvals and this Agreement shall be amended,as necessary,in order to comply with such judicial decision. (c)Participation in Litigation:Indemnity.The Developer agrees to indemnify the City and its elected boards, commissions, officers, agents and employees and will hold and save them and each of them harmless from any and all actions, suites, claims,liabilities,losses,damages,penalties,obligations and expenses(includingbut #31284 0-Development Agreement-Palm Hills is not limited to attorneys' fees and costs) against the City and/or Agent for any such Claims or Litigation (as defined in Section 1.10) and shall be responsible for any judgment arising therefrom.City shall provide Developer with notice of the pendency of such action and request that Developer defend such action.Developer may utilize the City Attorney's office or use legal counsel of its choosing,but shall reimburse the City for any necessary legal cost incurred by City. If Developer fails to do so, City may defend the action and Developer shall pay the cost thereof,but if City chooses not to defend the action, it shall have no liability to Developer. Developer's obligation to pay the defense cost shall extend until judgment. In the event of an appeal, or a settlement offer, the parties will confer in good faith as to how to proceed. Notwithstanding Developer's indemnity for claims and litigation, City retains the right to settle any litigation brought against it in its sole and absolute discretion and Developer shall remain liable except as follows: (i) the settlement would reduce the scope of the Project by 10% or more, and(ii) Developer opposes the settlement. In such case the City may still settle the litigation but shall then be responsible for its own litigation expense but shall bear no other liability to Developer. 13.2 Hold Harmless: Developer's Construction and Other Activities. Developer hereby agrees to, and shall defend, save and hold City and its elected and appointed boards, commissions, officers, agents, and employees harmless from any and all claims, costs (including attorneys' fees) and liability for any damages,personal injury or death,which may arise,directly or indirectly,from Developer's or Developer's agents, contractors, subcontractors, agents, or employees' operations under this Development Agreement, whether such operations be by Developer or by any of Developer's agents,contractors or subcontractors or by any one or more persons directly or indirectly employed by or acting as agent for Developer or any of Developer's agents, contractors or subcontractors.Nothing herein is intended to make Developer liable for the acts of City's officers, employees, agents, contractors of subcontractors. 13.3 Survival of Indemnity Obligations. All indemnity provisions set forth in this Development Agreement shall survive termination of this Agreement for any reason other than City's Default. 14. EFFECT OF AGREEMENT ON TITLE. 14.1 Covenant Run with the Land. Subject to the provisions of Sections 12 and 16: (a) All of the provisions, agreements, rights, powers, standards, terms, covenants and obligations contained in this Development Agreement shall be binding upon the parties and their respective heirs, successors (by merger, consolidation, or otherwise) and assigns, devisees, administrators, representatives, lessees, and all other persons acquiring any rights or interests in the Developer's Property, or any portion thereof,whether by operation of laws or in any manner whatsoever and shall inure to the benefit of the parties and their respective heirs, successors (by merger, consolidation or otherwise) and assigns; 931284 v6-Development Agreement-Pal on Hills 19 (b)All of the provisions of this Development Agreement shall be enforceable as equitable servitudes and constitute covenants running with the land pursuant to applicable law; and (c) Each covenant to do or refrain from doing some act on the Developer's Property hereunder(i)is for the benefit of and is a burden upon every portion of the Developer's Property, (ii)runs with such lands, and(iii)is binding upon each party and each successive owner during its ownership of such properties or any portion thereof, and each person having any interest therein derived in any manner through any owner of such lands,or any portion thereof,and each other person succeeding to an interest in such lands. 15. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION. 15.1 Non-liability of City Officers and Employees. No official, agent, contractor, or employee of the City shall be personally liable to the Developer, or any successor in interest,in the event of any default or breach by the City or for any amount which may become due to the Developer or to its successor, or for breach of any obligation of the terms of this Development Agreement. 15.2 Conflict of Interest. No officer or employee of the City shall have any financial interest,direct or indirect, in this Development Agreement nor shall any such officer or employee participate in any decision relating to the Agreement which affects the financial interest of any corporation,partnership or association in which he is,directly or indirectly,interested,in violation of any state statute or regulation. 15.3 Covenant Against Discrimination. Developer covenants that, by and for itself, its heirs, executors, assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the performance of this Development Agreement.Developer shall take affirmative action to insure that employees are treated during employment without regard to their race, color, creed religion, sex, marital status, national origin or ancestry. 16. MORTGAGEE PROTECTION. 16.1 Definitions.As used in this Section,the term"mortgage"shall include anymortgage, whether a leasehold mortgage or otherwise,deed of trust,or other security interest,or sale and lease- back, or any other form of conveyance for financing. The term"holder"shall include the holder of any such mortgage, deed of trust, or other security interest, or the lessor under a lease-back, or the grantee under any other conveyance for financing. 16.2 No Encumbrances Except Mortgages to Finance the Project. Notwithstanding the restrictions on transfer in Section 12,mortgages required for any reasonable method of financing of the construction of the improvements are pennitted but only for the following: (a)for the purpose of securing loans of funds used or to be used for financing the acquisition of a separate lot(s) or parcel(s), for the construction of improvements thereon, in payment of interest and other financing costs, and for any other expenditures necessary and appropriate to develop the Project under this #31284 v6-Development Agreement-Palm Hills 20 Agreement,or for restructuring or refinancing any for same.The Developer(or any entity permitted to acquire title under this Agreement)shall notify the City in advance of any future mortgage or any extensions or modifications thereof.Any lender which has so notified the City shall not be bound by any amendment, implementation, or modification to this Agreement without such lender giving its prior written consent thereto. City acknowledges the existence of the Existing Trust Deed and that said lender is entitled to the protections set forth in this Section 16.In any event,the Developer shall promptly notify the City of any mortgage, encumbrance, or lien that has been created or attached thereto prior to completion of construction,whether by voluntary act of the Developer or otherwise. 16.3 Developer's Breach Not Defeat Mortgage Lien. Developer's breach of any of the covenants or restrictions contained in this Agreement shall not defeat or render void the lien of any mortgage made in good faith and for value but unless otherwise provided herein, the terms, conditions, covenants,restrictions, easements, and reservations of this Agreement shall be binding and effective against the holder of any such mortgage whose interest is acquired by foreclosure, trustee's sale or otherwise. 16.4 Holder Not Obligated to Construct or Complete Improvements. The holder of any mortgage shall in no way be obligated by the provisions of this Agreement to construct or complete the improvements or to guarantee such construction or completion.Nothing in this Agreement shall be deemed or construed to permit or authorize any such holder to devote the Project or any portion thereof to any uses,or to construct any improvements thereon,other than those uses or improvements provided for or authorized by this Agreement. 16.5 Notice of Default to Mortgagee Deed of Trust or Other Security Interest Holders. Whenever City shall deliver any notice or demand to Developer with respect to any breach or default by Developer hereunder, City shall at the same time deliver a copy of such notice or demand to each holder of record of any mortgage who has previously made a written request to City therefor, or to the representative of such lender as may be identified in such a written request by the lender. No notice of default shall be effective as to the holder unless such notice is given. 16.6 Right to Cure.Each holder(insofar as the rights of City are concerned)shall have the right, at its option, within ninety(90) days after the receipt of the notice, and one hundred twenty (120) days after Developer's cure rights have expired, whichever is later, to: (a) Obtain possession, if necessary, and to commence and diligently pursue said cure until the same is completed, and (b) Add the cost of said cure to the security interest debt and the lien or obligation on its security interest; provided that in the case of a default which cannot with diligence be remedied or cured within such cure periods referenced above in this Section 16.6, such holder shall have additional time as reasonably necessary to remedy or cure such default. In the event there is more than one such holder,the right to cure or remedy a breach or default of Developer under this Section shall be exercised by the holder first in priority or as the holders may #31284 v6-Development Agyeement-Palm Hills 21 otherwise agree among themselves, but there shall be only one exercise of such right to cure and remedy a breach or default of Developer under this Section. No holder shall undertake or continue the construction or completion of the improvements (beyond the extent necessary to preserve or protect the improvements or construction alreadymade) without first having expressly assumed Developer's obligations to City by written agreement satisfactory to City with respect to the Project or any portion thereof in which the holder has an interest. The holder must agree to complete, in the manner required by this Agreement, the improvements to which the lien or title of such holder relates,and submit evidence satisfactory to the City that it has the qualifications and financial responsibility necessary to perform such obligations. 16.7 Citv's Rights upon Failure of Holder to Complete Improvements.In any case where one hundred eighty (180) days after default by Developer in completion of construction of im- provements under this Agreement,the holder of any mortgage creating alien or encumbrance upon the Projector portion thereof has not exercised the option to construct afforded in this Section or if it has exercised such option and has not proceeded diligently with construction,City may,after ninety (90)days'notice to such holder and if such holder has not exercised such option to construct within said ninety(90)day period,purchase the mortgage,upon payment to the holder of an amount equal to the sum of the following: (a) The unpaid mortgage, debt plus any accrued and unpaid interest(less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings, if any); (b)All expenses, incurred by the holder with respect to foreclosure, if any; (c)The net expenses (exclusive of general overhead),incurred by the holder as a direct result of the ownership or management of the applicable portion of the Project, such as insurance premiums or real estate taxes, if any; (d) The costs of any improvements made by such holder, if any; and (e) An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage debt and such debt had continued in existence to the date of payment by the City. If the City has not purchased the mortgage within ninety(90) days of the expiration of the ninety(90) days referred to above, then the right of the City to purchase shall expire. In the event that the holder does not exercise its option to construct afforded in this Section, and City elects not to purchase the mortgage of holder, upon written request by the holder to City, City agrees to use reasonable efforts to assist the holder selling the holder's interest to a qualified and responsible party or parties (as determined by City),who shall assume the obligations of making or completing the improvements required to be constructed by Developer,or such other improvements in their stead as shall be satisfactory to City. The proceeds of such a sale shall be applied first to the holder of those items specified in subparagraphs (a) through (e) hereinabove, and any balance remaining thereafter shall be applied as follows: 431284 v6-Development Agreement-Pahn Hills 22 (i)First,to reimburse City, on its own behalf and on behalf of the City, for all costs and expenses actually and reasonably incurred by City, including but not limited to payroll expenses, management expenses, legal expenses, and others; (ii)Second,to reimburse City, on its own behalf and on behalf of the City, for all payments made by City to discharge any other encumbrances or liens on the applicable portion of the Project or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults, or acts of Developer, its successors or transferees; and (iii)Third,to reimburse City,on its own behalf and on behalf of the City, for all costs and expenses actually and reasonably incurred by City,in connection with its efforts assisting the holder in selling the holder's interest in accordance with this Section. (iv)Fourth, any balance remaining thereafter shall be paid to Developer. 16.8 Right of City to Cure Mortgage,Deed of Trust or Other Security Interest Default.In the event of a default or breach by-Developer(or entity permitted to acquire title under this Section) prior to completion for the Project or the applicable portion thereof, and the holder of any such mortgage has not exercised its option to complete the development,Citymay cure the default prior to completion of any foreclosure.In such event,City shall be entitled to reimbursement from Developer or other entity of all costs and expenses incurred by City in curing the default,to the extent permitted by law,as if such holder initiated such claim for reimbursement,including legal costs and attorneys' fees, which right of reimbursement shall be secured by a lien upon the applicable portion of the Project to the extent of such costs and disbursements. Any such lien shall be subject to: (a) Any mortgage for financing as described in Section 16.2 of this Agreement; and (b)Any rights or interests provided in this Agreement for the protection of the holders of such mortgages for financing; provided that nothing herein shall be deemed to impose upon City any affirmative obligations(by the payment of money, construction or otherwise) with respect to the Project in the event of its enforcement of its lien. 16.9 Right of the City to Satisfy Other Liens on the Property After Conveyance of Title. After the conveyance of title and prior to completion of construction and development, and after the Developer has had a reasonable time to challenge, cure, or satisfy any liens or encumbrances on the Project the City shall have the right to satisfy any such liens or encumbrances;provided, however, that nothing in this Agreement shall require the Developer to pay or make provision for the payment of any tax,assessment, lien or charge so long as the Developer in good faith shall contest the validity #31284 v6-Development Agi eement-Palm Hills 23 or amount thereof, and so long as such delay in payment shall not subject the Projector any portion thereof to forfeiture or sale. 17. GENERAL. 17.1 Estoppel Certificates. Either Party(or a lender under Section 16) may at any time deliver written Notice to the other Party requesting an estoppel certificate(the"Estoppel Certificate") stating: (a)The Agreement is in full force and effect and is a binding obligation of the Parties; and (b) The Agreement has not been amended or modified either orally or in writing or, if so amended, identifying the amendments. (c) There are no existing defaults under the Agreement to the actual knowledge of the party signing the Estoppel Certificate. A Party receiving a request for an Estoppel Certificate shall provide a signed certificate to the requesting Party within thirty(30)days after receipt of the request.The Planning Director may sign Estoppel Certificates on behalf of the City. An Estoppel Certificate maybe relied on by assignees and Mortgagees. The Estoppel Certificate shall be substantially in the same form as Exhibit"D". 17.2 Force Majeure. The time within which Developer or the City shall be required to perform any act under this Development Agreement shall be extended-bra-period of-time-equal to-- the number of days during which performance of such act is delayed due to war,insurrection,strikes, lock-outs, riots, floods, earthquakes, fires, casualties, natural disasters, Acts of God, acts of the public enemy, epidemics, quarantine restrictions, freight embargoes, governmental restrictions on priority,initiative or referendum,moratoria,processing with governmental agencies other than City or Agency, unusually severe weather, third party litigation as described in Section 13.1 of this Agreement,or any other similar causes beyond the control or without the fault of the Party claiming an extension of time to perform. An extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if written notice by the party claiming such extension is sent to the other party within thirty(30)days of knowledge of the commencement of the cause. Any act or failure to act on the part of a Party shall not excuse performance by that Party. 17.3 Construction of Development Agreement. The language of this Development Agreement shall be construed as a whole and given its fair meaning.The captions ofthe sections and subsections are for convenience only and shall not influence construction. This Development Agreement shall be governed by the laws of the State of California. This Development Agreement shall not, be deemed to constitute the surrender or abrogation of the City's governmental powers over the Developer's Property. 17.4 Severability. 1f any provision of this Development Agreement is adjudged invalid, void or unenforceable, that provision shall not affect, impair, or invalidate any other provision, #31284 v6-Development Agreement-Palm Hills 24 unless such judgment affects a material part of this Development Agreement in which case the parties shall comply with the procedures set forth in Section 13.1(b). 17.5 Attorney's Fees.If either Party to this Agreement is required to initiate or defend,the prevailing party in such action or proceeding, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney's fees. Attorney's fees shall include attorney's fees on any appeal, and in addition a Party entitled to attorney's fees shall be entitled to all other reasonable costs for investigating such action,taking depositions and discovery and all other necessary costs the court allows which are incurred in such litigation.All such fees shall be deemed to have accrued on commence of such action and shall be enforceable whether or not such action is prosecuted. 17.6 Joint and Several Obligations.All obligations and liabilities of Developer hereunder shall be joint and several among the obligees. 17.7 Time of Essence. Time is of the essence in: (a)The performance of the provisions of this Development Agreement as to which time is an element; and (b)The resolution of any dispute which may arise concerning the obligations of Developer and City as set forth in this Development Agreement. 17.8 Waiver. Failure by a party to insist upon the strict performance of any of the provisions of this Development Agreement by the other party,or the failure by a party to exercise its tights upon the default of the other party, shall not constitute a waiver of such party's right to insist and demand strict compliance by the other party with the terms of this Development Agreement thereafter. 17.9 No Third Party Beneficiaries. The only parties to this Development Agreement are Developer and City. There are no third party beneficiaries and this Development Agreement is not intended, and shall not be construed to benefit or be enforceable by any other person whatsoever. 17.10 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the Party benefitted thereby of the covenants to be performed hereunder by such benefitted Party. 17.11 Counterparts. This Development Agreement may be executed by the parties in counterparts which counterparts shall be construed together and have the same effect as if all of the parties had executed the same instrument. 17.12 Authoritv to Execute.The persons executing this Development Agreement on behalf of the parties hereto warrant that (i) such party is duly organized and existing, (ii) they are duly authorized to execute and deliver this Development Agreement on behalf of said party, (iii) by so executing this Development Agreement, such party is formally bound to the provisions of this Development Agreement,(iv)the entering into of this Development Agreement does not violate any #31284 v6-Development Agreement-Palm Hills 25 provision of any other Agreement to which said party is bound and(v)there is no litigation or legal proceeding which would prevent the parties from entering into this Agreement. 17.13 Notice. (a)To Developer.Any notice required or permitted to be given by the City to the Developer under this Development Agreement shall be in writing and delivered personally to Developer or mailed with postage fully prepaid,registered or certified mail, return receipt requested, addressed as follows: Palm Hills Land Corp. 175 W. Jackson Blvd., Suite 400 Chicago, Illinois 60604 Attention: Edmund J. O'Connor With a copy to: Schlecht, Shevlin & Shoenberger, ALC 801 East Tahquitz Canyon Way, Ste. 100 Palm Springs, California 92262 Attention: James M. Schlecht or such other address as Developer may designate in writing to the City. (b) To the City. Any notice required or permitted to be given by the Developer to the City under this Development Agreement shall be in writing and delivered personally to the City Clerk or mailed with postage fullyprepaid,registered or certified mail, return receipt requested, addressed as follows: City of Palm Springs 3200 Tahquitz Canyon Way Palm Springs, California 92262 Attention: Planning Director With a copy to: ALESHIRE &WYNDER, LLP 18881 Von Karman Avenue, Suite 400 Irvine, California 92612 Attn: David J. Aleshire, City Attorney or such other address as the City may designate in writing to Developer. Notices provided pursuant to this Section shall be deemed received at the date of delivery as shown on the affidavit of personal service or the Postal Service receipt. #31284 v6-Development Agreement-Pahn Hills 26 17.14 Further Actions and Instruments. Each of the Parties shall cooperate with and provide reasonable assistance to the other to the extent necessary to implement this Development Agreement. Upon the request of either Party at any time, the other Party shall promptly execute, with acknowledgment or affidavit if reasonably required,and file or record such required instruments and writings and take any actions as may be reasonably necessary to implement this Development Agreement or to evidence or consummate the transactions contemplated by this Development Agreement. 17.15 Recitals. The recitals in this Development Agreement constitute part of this Development Agreement and each Party shall be entitled to rely on the truth and accuracy of each recital as an inducement to enter into this Development Agreement. 17.16 Recordine. The City Clerk shall cause a copy of this Development Agreement to be executed by the City and recorded in the Official Records of Riverside County no later than ten(10) days after the Effective Date. The recordation of this Development Agreement is deemed a ministerial act and the failure of the City to record the Development Agreement as required by this Section and the Development Agreement Statute does not make the Development Agreement void or ineffective. 17.17 Relationship of Parties. It is specifically understood and agreed by and between the Parties that the Project is a private development,that neither Party is acting as the agent of the other in any respect hereunder,and that such Party is an independent contracting entity with respect to the terms, covenants, and conditions contained in this Development Agreement.The only relationship between the City and Developer is that of a government entity regulating the development ofprivate property and the owner of such private property. 17.18 Entire Agreement. This Development Agreement constitutes the entire agreement between the Parties with respect to the subject matter of this Development Agreement, and this Development Agreement supersedes all previous negotiations,discussions,and agreements between the Parties.No parol evidence of any prior or other agreement shall be permitted to contradict or vary the terms of this Development Agreement. 931284 v6-Development Agieement-Palm Hills 27 IN WITNESS WHEREOF, the City and Developer have executed this Development Agreement on the date first above written. CITY OF PALM SPRINGS BY:\, ..����( MAYOR Z� 16k 0 � ATTEST: CLERK Approved as to form City Attorney "DEVELOPER" PALM HILLS LAND CORP., a California corporation— BY: (E *UNb J. O'CONNOR,President BY-A MAR7)�k{,IE O'CONNOR, Secretary #31284 v6-Development Agreement-Palm Hills 1 STATE OF CALIFORNIA ) ) ss. COUNTY OF RIVERSIDE ) fAuunQy 'lam On this _day ofvccefnw�;, , before me, the undersigned, a Notary Public in and for said State,personally appeared EDMUND J. O'CONNOR, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument, and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. NOTARY PUBLIC CHARLENE TREATCH 1J Commission#1304517 z =m Notary Public-California z Riverside County r' MyComm Eepires May14,2005 1,1 STATE OF ILLINOIS ) ss. COUNTY OF COOK ) On this 2tiv day of December, 2004, before me, the undersigned,allotary Public in and for said State,personally appeared MARY JANE O'CONNOR, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument, and acknowledged to me that she executed the same in her authorized capacity, and that by her signature on the instrument the person or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and,offi'cial.seal. NOTARY PUBLIC corn CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California ss. County of 'Rt V e-r SI Ct E' V On 5Qnl �Dsrl a©C?beforeme, JVptfi�t �, l�ltC�O1S� I"1ofi@r � hubl; C, Data (Nevi f Name and Title of Officer(e g "Jan iiDab,Nolary Pub le) personally appeared �OVI ( evi Cd V) jam es fi Yl0 Yrl PSO Y\ Nome(e)of Signers) Apersonally known to me G—proved to me on the baeie of satisfactory ev derrce - to be the person(D whose name ar r subscribed to the within instrument and JUmi NIC4878H&r ( acknowled ed to me that hefsFa /the executed -'+ + commissbn+M taeiaza [ g -� Notary Public-CoNtomla the same in thei authorized fi RWerslditCounty [ capacity les and that by histhe their _ _ — MyCamm.E�ieaMay2t-200Et signature s on the instrument the person s , or — — the entity upon behalf of which the persons acted, executed the instrument WITNESS my hand and official seal. 0 Place Notary Seel Above 9ignature of Notary Public OPTION L Though the information below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent removal and reattachment of this form to another document. Description of Attached Document (� Title or Type of Document: D e ve 10 P VkQ Vie A�r e e YYIC yi r Document Date: CSO ly �Iy „7 (�O 1 Number of Pages: Signer(s) Other Than Named Above:DaljAd ovieyweII S'or R+eC�',Ye 4 �1 YhIe% ) Edmornd J-Ce.Ohh4DrvPres., Qnet Glry 3aheO COvinor� S @C . Capacity(ies) Claimed by Signer _ l Signer's Name: ROnOdehy May or ctne( �C2M0S I 'DknPSanA Q ` ❑ Individual C ct Y C(P r ti ONEELILam Top of thumb here ) AC Corporate Officer—Title(s): 'Moat ❑ Partner—❑ Limited ❑ General t _ ❑ Attorney in Fact ` ❑ Trustee ❑ Guardian or Conservator ❑ Other: Signer Is Representing: e q 0 YYl r i YI� S �j ©1999 National Nolary Association•9350 No Solo Avc.,P.O.Box 2402•Chaa.inh.CA 91313-24g2•www nallonalnelaryorg Prod.No 5907 Foortler,Call Toll Fee.1-800-876-6827 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT State of California ss..........._ < _ _�.,�.-.:.,.:.-, r<.,•r ,-,��1 I County of } �e It „„ On _, before me, Date Name and Title of Officef(e g "Jane Doe,Notary Public')1 ,JI personally appeared ;* Neme(e)or Signers) ❑ personally known to me 5 ��, � proved to me on the basis of satisfactory ;I "1 evidence ;' ti to be the persons) whose name(s) is/are IF I subscribed to the within instrument and acknowledged to me that he/she/they executed u 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) n, acted, executed the instrument. WITNESS my hand and official seal � f Place Notary Seal Above Signature of Notary Public OPTIONAL z Though the information below IS not required by law, It may prove valuable to persons relying on the document 'Z and could prevent fraudulent removal and reattachment of this form to another document. Description of!attached Document �I `ft Title or Type of Document: Document Date Number of Pages. I i6� 91 Signer(s) Other Than Named Above. , 21 C Capacity(ies) Claimed by Signer t� ; `I Signer's Name: + •+ t= -+T- � Irl ❑ Individual I'>I Top of Ihumb hale ❑ Corporate Officer—Title(s): lo; ❑ Partner—❑ Limited ❑ Generale li' ❑ Attorney in Fact of I�r ❑ Trustee ;I <<� ❑ Guardian or Conservator 2 -, ❑ Other: al ( Signer Is Representing: bl IC jl It. o.-CA=c;uJa-c,cGC�u:.�p✓.>'c:G.c�l�u.cc.x=<.uv��c..•J r<•r..�... - - _.-.-max ,-''T�6'6C•^v�Y`��"�L`C���,^i`Cy�.�.�,n.l�� 01999 Nallonal Notary Association 19350 De Soto Ave,Po.Box 2402•Chatsworth,CA 913132402•www n a I onatnolarym9 Pad No 5907 Reortler Call Tall Doe 1-800 876 6827 EXHIBIT "A" MAP AND LEGAL DESCRIPTION OF DEVELOPER'S PROPERTY 931284 v6-Development Agreement-Palm Hills EXHIBIT A EXIMIT "A" LEGAL DESCRIPTION PARCEL"A" SECTION 31, TOWNSHIP 4 SOUTH,RANGE 5 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO THE OFFICIAL PLAT THEREOF. PARCEL`B" THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER OF THE NORTHWEST QUARTER OF SECTION 32, TOWNSHIP 4 SOUTH, RANGE 5 EAST, SAN 13ERNARDINO BASE AND MERIDIAN,ACCORDING TO UNITED STATES GOVERNMENT SURVEY; EXCEPTING THEREFROM THAT PORTION WITHIN TRACT MAP NO. 17043 RECORDED JUNE 18, 1984 IN BOOK 141 OF MAPS,PAGES 52 THROUGH 57, INCLUSIVE,RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL"C" THE EAST HALF OF THE NORTHWEST QUARTER OF SECTION 32, TOWNSHIP 4 SOUTH,RANGE 5 EAST, SAN BERNARDINO BASE AND MERIDIAN, ACCORDING TO UNITED STATES GOVERNMENT SURVEY; EXCEPTING THEREFROM THE NORTHEAST QUARTER OF THE NORTHEAST QUARTER OF THE NORTHWEST QUARTER OF SAID SECTION 32; ALSO EXCEPTING THEREFROM THAT PORTION WITHIN TRACT MAP NO. 17043 RECORDED JUNE 18, 1984 IN BOOK 141 OF MAPS,PAGES 52 THROUGH 57, INCLUSIVE,RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. PARCEL"D" THE WEST HALF OF THE WEST HALF OF SECTION 32, TOWNSHIP 4 SOUTH, RANGE 5 EAST, SAN BERNARDINO BASE AND MERIDIAN; EXCEPTING THEREFROM THAT PORTION WITHIN TRACT MAP NO. 17043 RECORDED JUNE 18, 1984 IN BOOK 141 OF MAPS,PAGES 52 THROUGH 51, INCLUSIVE,RECORDS OF RIVERSIDE COUNTY,CALIFORNIA. PARCEL "E" LOTS 1 THROUGH 95, INCLUSIVE, AND LOTS "A" THROUGH"M", INCLUSIVE, OF TRACT MAP NO. 17043,AS SHOWN BY MAP ON FILE IN BOOK 141 OF MAPS, PAGES 52 THROUGH 57, INCLUSIVE, RECORDS OF RIVERSIDE COUNTY, CALIFORNIA. 0:\40795\4079500\dma ings\su ey\Legals\Exliibit A.dw '/7 Pagel of 2 EXHIBIT ffAff SHEET 2 OF 2 NE COR SEC 31 N 1/4 COR SEC 32 NW COR SEC 31 PARCEL "B" PARCEL "E" doe PARCEL "A1l QP� C 1/4 COR SEC 32 LL CW 1/15 COR SEC 32 0 0 0 d n PARCEL "D" o s m SW COR SEC 31 SE COR SEC 31� W 1/16 COR SEC 32 s. L 9 The Keith Companies nm SCALE: 1' 1000' ` MAL AM 0 .4dw 14w.{ CI #Z" /frog aie- i o = EXHIBIT "B" PHASE PLAN/SCHEDULE OF PERFORMANCE PHASE TIME Phase I Golf Course, Clubhouse, Main Entry and Utilities 5 years from Effective Date Phase R Single Family detached Lots—30 (Eastern area) 5 years from Effective Date Phase III A. Single Family detached Lots—22 (Middle area) Within Term of Agreement B. Hotel (200 units) and condominium vacation ownership units (105) 5 years from Effective Date Phase IV Single Family detached Lots --_(Western and Within Tenn of Agreement Southern areas [and/or condominium vacation ownership units]) The foregoing Phases are generally shown in the Phasing Map attached as Exhibit B 1. #31284 v6-Development Agreement-Pahu Hills EXHIBIT B Fp M ILLS oih� wwa � um ® s � NNW ��� SPECIFIC PIAN Phase Phase H ® Phase III ® Phase IV •• ®�.. Phasing Exhibit PEN SPACE .ecr OPEN SPACE QO Figure B-1 OPEN SPA OPEN SPACE / �PACMH1U5LgNDCORP /ND/ANAL c=s ll W OPENSPACE•� u �� L EXHIBIT "C" EXISTING DEVELOPMENT APPROVALS 1. General Plan 2. Palm Hills Specific Plan No. 1 3. Planned Development District No. 258 4. Tentative Parcel Map No. 29101 5. Tentative Tract Map No. 29100 6. Palm Springs Municipal Code,Zoning Code, Building Code and other City Codes. 7. Conditions of Approval S. Mitigation Monitoring Program 9. Environmental Impact Report #31284 v6-Development Agreement-Pahn Hills EXHIBIT C EXHIBIT "D" ESTOPPEL CERTIFICATE Date Requested: Date of Certificate: On 200, the City of Palm Springs approved the Development Agreement between Palm Hills Land Corp., a California corporation and the City of Palm Springs (the"Development Agreement"). This Estoppel Certificate certifies that, as of the Date of Certificate set forth above: [CHECK WHERE APPLICABLE] 1. The Development Agreement remains binding and effective. 2. The Development has not been amended. 3. The Development Agreement has been amended in the following aspects: 4. To the best of our knowledge, neither Developer nor any of its successors is in default under the Development Agreement. 5. The following defaults exist under the Development Agreement: This Estoppel Certificate maybe relied upon by an transferee or mortgagee of any interest in the property which is the subject of the Development Agreement. CITY OF PALM SPRINGS BY: PLANNING DIRECTOR #31284 v6-Development Agreement-Palm Hills EXHIBIT D EXHIBIT "E" SUMMARY OF FEES, TAXES AND ASSESSMENTS EXISTING AS OF THE EFFECTIVE DATE A document compiling the fees,taxes and assessments applicable to the development of the real property which exist as of the Effective Date is on file in the City's Office of Planning and Zoning("Fee Summary"). Other fees for services not applicable to real estate development may be included within said compilation but shall not be deemed subject to the limitations set forth in this Agreement.Developer acknowledges that the Fee Summary is based on a best efforts attempt bythe City to compile all such applicable fees, taxes and assessments that are in effect as of the Effective Date. If any such items have been omitted from the Fee summary, City shall notify Developer and present reasonable evidence that such excluded tax,fee or assessment was,in fact,in effect as of the Effective Date and subsequently such matter shall be included within the Fee Summary and Developer shall be responsible for same as provided in the Agreement. #31284 v6-Development Agreement-Palm Hills EXHIBIT E EXHIBIT "F" FINANCIAL IMPACT MITIGATION FEE ARTICLE I GENERAL Developer agrees that if the vacation units are developed as a Timeshare Ownership with an Association,then the Timeshare Association will impose upon all timeshare units and pay to the City a financial impact mitigation fee of$28.50 per Timeshare Interval (as defined below)per year("Financial hnpact Mitigation Fee" or"FIM Fee") to complete the Project and to pay certain costs including: a) to pay for certain public infrastructure costs benefiting the Project including for construction of street and drainage improvements; b) to pay for public landscaping,lighting and maintenance costs arising from area development; c) to compensate the City for the loss of tax revenue to City which would otherwise be generated from the conversion of a portion of the Project from a hotel to a timeshare development; and d) to pay for certain other service enhancements and other obligations undertaken by Developer. ARTICLE II FINANCIAL IMPACT MITIGATION FEE/TRANSIENT OCCUPANCY TAX 2.1 Timeshare Association; Definitions. The Project, as described in the DA, provides for the construction and sale of timeshare vacation units ("Timeshare Units")on the Site. Any portion of a Timeshare Unit that is separately keyed and contains a kitchenette shall be considered a part of such Timeshare Unit and shall in no event be considered a separate Timeshare Unit. Developer (the "Timeshare Operator") intends to own and operate the Project and sell timeshare interval interests involving the right of occupancy of a Timeshare Unit (a "Timeshare Interest")to Timeshare Owners. Timeshare Interests will be represented by points that will entitle a Timeshare Owner to occupy a Timeshare Unit. The number of points entitling a Timeshare Owner to occupy a Timeshare Unit for seven (7) consecutive days shall be referred to as a "Timeshare Interval." The term "Timeshare Owner" or "Owner" shall include the original purchaser, or any successor owner, of a Timeshare Interest whether the successor owner acquires the Timeshare Interest through a purchase, assignment or conveyance from the original owner,but shall not include a person who has the right to use the Timeshare Unit through an internal or external exchange company(so long as the FIM Fee has been paid by the Timeshare Owner for the applicable period), and in no event shall either tern refer to or include Developer or Timeshare Operator. The #31284 v6-Development Agieement-Palm Hills EXHIBIT F Timeshare Operator intends to create a homeowners association (the "Timeshare Association" or "Association")which shall be responsible for, among other things, the maintenance of the Project and common areas and collection of the Financial Impact Mitigation Fee described in Section 2.2. Timeshare Owners shall be members of the Timeshare Association by reason of the purchase of a Timeshare Interest. 2.2 Financial Impact Mitigation Fee. Developer hereby covenants that all Timeshare Units located on the Site for which a Timeshare Interest has been conveyed to a Timeshare Owner, shall be subject to the payment of a Financial Impact Mitigation("FIM")Fee of Twenty-Eight and 501100 Dollars ($28.50) per Timeshare Interval per year. Developer acknowledges that the value of the benefits that will accrue to the Project and each Timeshare Owner from the improvements and services funded by the FIM Fee, as further described in Section 2.3, exceeds the amount of the FIM Fee and, therefore, Developer agrees that the FIM Fee shall not be reduced or offset in the event Developer or a Timeshare Owner determines not to use a particular service funded by the FIM Fee. The FIM Fee shall be separate from and in addition to any transient occupancy tax collected for interim use of the Timeshare Units by the public that is subject to the transient occupancy tax as set forth in the Palm Springs Municipal Code. (a) Method of Collection of FIM Fee. Collection of the FIM Fee shall be the responsibility of the Timeshare Association. The FIM Fee on all Timeshare Interests in the Project shall be levied,collected and transferred to the City in accordance with the following. (i) After Sale or Exchange of Timeshare Interest. From and after the date of sale of a Timeshare Interest in a Timeshare Unit (the "Sale Date"),the Timeshare Owner shall pay,and the Timeshare Association shall collect,a FIM Fee in the amount of$28.50 per Timeshare hiterval. The FIM Fee shall be in addition to any transient occupancy tax otherwise payable pursuant to the Palm Springs Municipal Code for any period the Timeshare Unit is rented to the public as a hotel room, including any period of rental during the time the Timeshare Owner would otherwise have a right to occupancy pursuant to the Timeshare Interest. The FIM Fee shall be due and payable from a Timeshare Owner for each year in which Timeshare Interest occupancy rights occur. The FIM Fee payable by each Timeshare Owner shall be collected from the Timeshare Owner by the Timeshare Association annually,in advance.In the year of the Sale Date the FIM Fee shall be paid on the Sale Date as part of the closing of the sale transaction. Thereafter, the FIM Fee shall be paid as part of the regular annual assessments on the date established for the payment of the regular assessments(the"Collection Due Date"). If the Timeshare Owner does not have occupancy rights in the calendar year of the Sale Date, then no FIM Fee shall be payable by such Timeshare Owner for that calendar year. The total amount of the FIM Fees for all Timeshare Interests in the Project shall be due and payable, and shall be remitted in full by the Timeshare Association to the City, not later than thirty (30) days following the Collection Due Date, regardless of whether the FIM Fee has actually been collected from the Timeshare Owners. In no event shall the Developer or #31284 v6-Development Agreement-Pahn Hills EXHIBIT F Timeshare Operator be liable for any FIM Fees not collected from the Timeshare Owners. If a Timeshare Owner purchases an"every other year"or "alternate year" Timeshare Interest, and is charged an equal annual assessment by the Association,the annual FIM Fee shall be reduced by fifty percent(50%). (ii) Entities Responsible for Collection of FIM Fee. Developer, as Timeshare Operator,shall be responsible for collecting the FIM Fee that is due with respect to any Timeshare Interest in the year of the Sale Date and remitting such Fees to City, Thereafter,the Timeshare Association shall collect such fees as part of the regular annual assessment. (b) Adjustments to FIM Fee. Beginning on the fifth anniversary of the date of the first sale of a Timeshare Interest in the Project and each five (5) years thereafter, the FIM Fee set forth in this Section 2.2 shall be increased by ten percent(10%)of the FIM Fee applied in the five(5)year period immediately before such increase. Notwithstanding any additional services provided by City or obligations undertaken by City,City agrees that the FIM Fee established herein shall not be increased except pursuant to the automatic adjustment provisions of this Section 2.2(b). (c) Reports; FIM Fee Shortfall. Along with the total FIM Fees collected for each year,the Timeshare Association shall deliver to City a statement showing the Timeshare Intervals, name(s) of person(s) owning such Timeshare Interval and the amount of the FIM Fee collected for such Timeshare Interval. All Timeshare Intervals shall be subject to the FIM Fee and Timeshare Association shall pay to City the FIM Fee applicable to such Timeshare Interval, irrespective of whether Timeshare Association collects such fee from the timeshare user. If Developer, for any reason, fails to pay all or part of the FIM Fee applicable to the timeshare use in the Project, Agency shall be entitled to deduct any such shortfalls from the payments due Developer under the Note (as those terms are defined in the DDA). (d) If anyprovision of this Agreement is determined to be invalid so as to reduce or eliminate the City's entitlement to collect the FIM Fee for all Timeshare Interests pursuant to this Section, the Agency's obligation to repay the Note shall be modified in accordance with the provisions set forth in the DDA and the Note. (e) Developer, on behalf of itself and its successors, waives any rights it may have now or in the future to challenge the legal validity of or contest the FIM Fee, including, without limitation, any claim that the FIM Fee constitutes an abuse of the police power,violates substantive due process, denies equal protection of the laws, effects a taking of property without payment of just compensation, or imposes an unlawful tax. IN FURTHERANCE OF THE INTENTIONS OF THE PARTIES TO THIS AGREEMENT,WITH RESPECT TO THE FIM FEE ONLY,DEVELOPER,WITH *31284 v6-Development Agreement-Palm Hills EXHIBIT F AND UNDER ADVICE OF COUNSEL, HEREBY EXPRESSLY WAIVES ANY AND ALL RIGHT AND BENEFIT CONFERRED UPON SAID PARTIES BY THE PROVISIONS OF CIVIL CODE SECTION 1542, WHICH PROVIDES AS FOLLOWS: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH, IF KNOWN TO HIM, MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR." With respect to the FIM Fee only, and any challenges or potential challenges thereto, Developer expressly waives any and all rights and benefits conferred upon the Developer by any provision of any other state, federal or local statute, code,ordinance, or law similar to section 1542 of the California Civil Code. With respect to the FIM Fee only, Developer expressly consents that the waiver of rights contained in this paragraph shall be given full force and effect,according to the express terms of the instant waiver,to unknown and unsuspected claims, demands, and causes of action pertaining to the FIM Fee only,if any,arising out of or relating to the waiver of rights contained herein. 2.3 Purposes of Financial Impact Mitigation Fee;Basis of Expenditure. The FIM Fee is paid to the City to compensate City for certain costs imposed on the City by the Project, and for improvements and services of the City that will benefit the Project. The Director of Finance shall account for all FIM Fees received and the purposes for which such funds are spent. The FIM Fees shall be paid to the City to compensate City for the following: (a) The City is developing certain infrastructure within the vicinity of the Proj ect which will benefit the Project and which are not otherwise provided by the Project. These improvements include street, drainage and associated improvements. The Project will need drainage and flood enhancements. (b) The public rights of way in conjunction with the Project and emanating from the Project include landscaping and lighting improvements,and will require enhanced maintenance activity by the City to beautify the Project and enhance its attractiveness. No assessment district has been established in the area, and without this funding mechanism the Project needs to contribute to the higher level of maintenance commensurate with the quality of the Project. (c) Declarant agrees that occupancy ofthe Timeshare Units in this Project in this City by a transient owner population creates a greater demand on public safety and other services provided by the City than does the occupancy of condominiums, homes, apartments, and other residential dwellings in the City by full-time owners or renters thereof. The greater impacts are similar to the impacts caused by the transient occupation of hotels in the City, for which the City collects a transient occupancy tax. Declarant acknowledges and agrees that,in addition to the benefits and services listed herein, the FIM Fee is imposed for the purpose of mitigating the burden on City services created by development of the Project as a #31284 v6-Development Agreement-Palm Hills EXHIBIT F timeshare Project, in lieu of other lost tax revenues from a different type of development project. (d) Other service enhancements provided to the Project, or other obligations for maintenance and operation of the Project as provided in this Agreement, the DDA or other understanding of the parties. 2.4 Transient Occupancy Tax. Developer hereby acknowledges that all units located on the Site, which have not been sold as Timeshare Units or which have been sold as Timeshare Units but are rented to the public, shall be subject to the payment of transient occupancy tax as set forth in the Palm Springs Municipal Code. Notwithstanding the foregoing, the parties intend that in no event shall both the full FIM Fee and a transient occupancy tax or timeshare occupancy tax be assessed with respect to occupancy of a Timeshare Unit for a particular period of time during the 5 1/2 year period immediately following the Effective Date of the DDA (the "Exemption Period"). During the Exemption Period,in the event that any transient occupancy tax or timeshare occupancy tax is assessed, then the FIM Fee shall continue to be due,however it will be reduced to an amount equal to$28.50 minus the amount of the transient occupancy tax or timeshare occupancy tax assessed per unit(but not less than zero). After the Exemption Period,the FIM Fee shall not be reduced or offset by any transient occupancytax or timeshare occupancytax that maybe imposed by the City. Provided that the FIM Fee has been paid for the Timeshare Unit for the applicable period, in no event shall any transient occupancy tax or timeshare occupancy tax be payable with respect to occupancy of a Timeshare Unit by an owner of a timeshare interest in any other timeshare project through any internal or external exchange company, whether such other timeshare project is owned or operated by Developer or an affiliate of Developer, or otherwise. 2.5 Department of Real Estate Approval. The provisions contained herein regarding the imposition and' collection of the FIM Fee are consistent with the corresponding provisions in the Declaration attached to the DDA as Exhibit "F." Agency and City have acknowledged that Developer is required to obtain approval of the Declaration by the Department of Real Estate ("DRE"), and have agreed with Developer to amend the Declaration as reasonably necessary to obtain such DRE approval. City and Developer further agree to make minor modifications to this Exhibit as reasonably necessary to obtain such DRE approval. Such modifications may be approved in writing by the City Manager in accordance with Section 9.18 of the Agreement without requiring a formal amendment to this Agreement. 2.6 Disclosure to Successor Owners. Developer, its successive owners and assigns(including Timeshare Owners),shall,prior to the conveyance of a Timeshare Interest,inform potential purchasers of a Timeshare Interest of the Timeshare Owner's obligation to pay the FIM Fee to the City annually pursuant to Section 2.2. Each potential purchaser shall also be given notice of the amount of the FIM Fee. #31284 v6-Development Agreement-Palm Hills EXHIBIT F