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CONTRACT 4165 Developer’s Agreementv i A F *17z 4165.,,,E This page is part of your document - DO NOT DISCARD - ��� °f °sue 20110695096 Pages : I 0025 Recorded/Filed In Official Records k Recorder's Office, Los Angeles County, x California o�ui=oRN`�' 05/17/11 AT 02:41PM FEES: 0.00 TAXES: 0.00 OTHER: 0.00 PAID: 0.00 LEADSHEET 201105170050138 00004153823 I�G9IYINVI6'N�II� SEQ: 01 1111111111111111111 biwimbmaoro�ieuoa 1 THIS FORM IS NOT TO BE DUPLICATED A This page is part of your document - DO NOT DISCARD - ��� °f °sue 20110695096 Pages : I 0025 Recorded/Filed In Official Records k Recorder's Office, Los Angeles County, x California o�ui=oRN`�' 05/17/11 AT 02:41PM FEES: 0.00 TAXES: 0.00 OTHER: 0.00 PAID: 0.00 LEADSHEET 201105170050138 00004153823 I�G9IYINVI6'N�II� SEQ: 01 1111111111111111111 biwimbmaoro�ieuoa 1 THIS FORM IS NOT TO BE DUPLICATED A EXEMPT FROM RECORDER'S FEES Pursuant to Government Code §§6103,27383 Recording Requested By and When Recorded Return to: CITY CLERK CITY OF EL SEGUNDO 350 MAIN STREET EL SEGUNDO, CA 90245 DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF EL SEGUNDO 4165. AND REALTY ADVISORS ASSOCIATES, LLC, A DELAWARE LIMITED LIABILITY COMPANY THIS AGREEMENT MUST BE RECORDED WITHIN TEN DAYS OF EXECUTION BY ALL PARTIES HERETO PURSUANT TO THE REQUIREMENTS OF GOVERNMENT CODE §65868.5 4155. DEVELOPMENT AGREEMENT This Development Agreement ( "Agreement ") is made t4is 19th day of April 2011, by and between the CITY OF EL SEGUNDO, a City in the State of California ( "City "), and REALTY ADVISORS ASSOCIATES, LLC, a Delaware limited liability company (the "Developer "). In consideration of the mutual covenants and agreements contained in this Agreement, the City and Developer agree as follows: 1. Recitals. This Agreement is made with respect to the following facts and for the following purposes, each of which are acknowledged as true and correct by the parties: A. The City is authorized pursuant to Government Code §§ 65864 through 65869.5 to enter into binding agreements with persons or entities having legal or equitable interests in real property for the development of such property in order to establish certainty in the development process. B. The Developer is the owner of certain real property, located at the southeast comer of Sepulveda Boulevard and Walnut Avenue (the "Site "), commonly known as 888 N. Sepulveda Boulevard, 892 N. Sepulveda Boulevard, and 898 N. Sepulveda Boulevard (collectively, the "Site "). Currently, 898 N Sepulveda Boulevard is improved with an eight (8) - story, eighty -five thousand (85,000) square foot office building, which Developer recently caused to be remodeled and retrofitted. 898 N Sepulveda Boulevard is hereinafter referred to as "Parcel 1" and is legally described on Exhibit "A -1" attached hereto. Currently, 888 N. Sepulveda Boulevard is vacant. The property was formerly improved with a twelve (12) -story, one hundred forty thousand (140,000) square foot office building, which had been vacant for approximately ten (10) years, that contained asbestos and required extensive retrofitting. The building was demolished in 2002. Located on 892 N. Sepulveda Boulevard is a six (6) -story parking structure, providing required parking for the buildings located on Parcel 1 and Parcel 2, and for a separate airport parking business operated by a Developer known as "Airport 105 Parking." 888 N. Sepulveda Boulevard and 892 N. Sepulveda are collectively referred to and herein as "Parcel 2 ", and are legally described on Exhibit "A -2" attached hereto. C. The Parties desire to enter into this Agreement in conformance with the Government Code and the El Segundo Municipal Code in order to achieve the development of the Site as expressly provided under the terms of this Agreement. D. The Developer proposes to construct an office building ten (10) stories or less, but not to exceed 200 feet in height, consisting of a maximum of eighty eight thousand eight hundred and forty seven (88,847) square feet with a Floor Area Ratio ( "FAR ") of 0.8. Parking for the new office building would be provided by the existing parking structure located on Parcel 2, with an additional seventeen (17) surface parking stalls (the "Development Project. ") The Development Project is 4155. T ., # hereinafter sometimes referred to as the "Project." All parking required for Parcel 1 must be provided on Parcel 2. E. The City desires to obtain the binding agreement of the Developer for the development of the Site in accordance with the provisions of this Agreement. F. The Developer desires to obtain the binding agreement of the City to permit the Developer to develop the Project in accordance with the "Applicable Rules" (as hereinafter defined), as modified by this Agreement. In consideration thereof, Developer agrees to waive its rights to legally challenge the limitations and restrictions imposed upon the development of the Property pursuant to the Project approvals and this Agreement and to provide the public benefits and improvements specified in this Agreement. G. Developer has applied to the City in accordance with applicable procedures for approval of this mutually binding Agreement. The Planning Commission and City Council of the City have given notice of intention to consider this Agreement and, have conducted public hearings thereon pursuant to the Government Code. H. This Agreement is consistent with the present public health, safety, and welfare needs of the residents of the City of El Segundo and the surrounding region. The City has specifically considered and approved the impact and benefits of this Project upon the welfare of the region. I. This Agreement will bind the City to the terms and obligations specified in this Agreement and will limit, to the degree specified in this Agreement and under State law, the future exercise of the City's ability to delay, postpone, preclude or regulate development of the Project on the Site except as provided for herein. J. This Agreement eliminates uncertainty in planning and provides for the orderly development of the Project, and generally serves the public interest within the City of El Segundo and the surrounding region. K. The City is entering into this Agreement in part because it anticipates that the Project, once completed, will replace vacant property with an attractive structure acting as a gateway and landmark for the northern portion of the City. 2. Definitions. In this Agreement, unless the context otherwise requires: (a) "Applicable Rules" means: (i) statutes, ordinances, the rules, regulations, and official policies of the City in force as of the "Effective Date" (as hereinafter defined) governing zoning, development, density, permitted uses, growth management, environmental consideration, and design criteria applicable to the Project as modified by Section 6(f) of this Agreement; and (ii) the mitigation measures adopted 3 by the City and the conditions imposed by this Agreement and the Project's Discretionary Approvals. (b) "Discretionary Actions; Discretionary Approvals" are actions which require the exercise of judgment or a decision, and which contemplate and authorize the imposition of revisions or conditions, by the City, including any board, commission, or department of the City and any officer or employee of the City, in the process of approving or disapproving a particular activity, as distinguished from an activity which merely requires the City, including any board, commission, or department of the City and any officer or employee of the City, to determine whether there has been compliance with applicable statutes, ordinances, regulations, or conditions of approval. (c) "Effective Date" means the date the applications for Discretionary Approvals were approved by City Council. (d) "Subsequent Applicable Rules" means the rules, regulations, and official policies of the City, as they may be adopted, operative after the Effective Date of this Agreement which, other than as provided for in this Agreement, would govern the zoning, development, density, permitted uses, growth management, environmental considerations, and design criteria applicable to the Project and Site. The parties intend the development of the Project and the Site to be subject to Subsequent Applicable Rules only to the extent specified in paragraph (a) of Section 8 of this Agreement. (e) "Zoning Ordinance" means the zoning regulations set forth in the El Segundo Municipal Code, as it exists on the Effective Date. 3. Interest of Developer. The Developer represents to the City that, as of the Effective Date, it owns the Site in fee, subject to encumbrances, easements, covenants, conditions, restrictions, and other matters of record. 4. Binding Effect. This Agreement, and all of the terms and conditions of this Agreement, runs with the land comprising the Site and is binding upon and inures to the benefit of the parties and their respective assigns, heirs, or other successors in interest. 5. Negation of Agency. The Parties acknowledge that, in entering into and performing under this Agreement, each is acting as an independent entity and not as an agent of the other in any respect. Nothing contained herein or in any document executed in connection herewith may be construed as making the City and Developer joint venturers, partners or employer /employee. 6. Development of the Property. The following specific restrictions govern the use and development of the Project as described herein and in Exhibit "B," and without the need for any additional Discretionary Actions: 4 41 65 . I a 0 (a) Permitted Uses of the Propert y. Nothing set forth in this Agreement may be deemed to require Developer to complete the Project; however, the City and the Developer agree that the permitted, conditional and permitted uses of the Property are provided in the Applicable Rules, as modified by subsection (f) herein below; (b) Density and Intensity of Use. The City and Developer agree that the maximum densities and intensities for the permitted use of the Project are as set forth in this Agreement and the Discretionary Approvals. (c) Maximum Height and Size of Proposed Building. The City and Developer agree that the maximum height and size of the building proposed for the Project are set forth in this Agreement. (d) Development Standards. All design and development standards applicable to the development of the Project must comply with the Applicable Rules, as modified by subsection (f) herein below, the conditions of the Discretionary Approvals as adopted, amended or modified in the future by mutual consent. The sole exactions, conditions, and mitigation measures to be required for the Project are those contained in the Applicable Rules, the conditions imposed by the Project's Discretionary Approvals, and this Agreement. (e) Adherence to Building Code. All construction on the Property must adhere to the model codes adopted by reference in the ESMC in accordance with California law in effect at the time the plan check or permit is approved and to any federal or state building requirements that are then in effect (collectively "the Building Codes "). (f) Extension of Interim Approval for Airport Park and Ride. The Developer may design and construct the Project with the following exceptions to the current Zoning Ordinance Development Standards, as may reasonably be required to carry out the Project, including, without limitation, the following: (i) In connection with Development Project, the existing "Administrative Use Permit" (EA No.356, and AUP No. 94 -6), for Developer's currently existing "Park and Ride" business is permanently revoked and the use must be discontinued upon the issuance of a Certificate of Occupancy for the first tenant improvement associated with the Development Project, excluding occupancy of a building management/leasing office which does not trigger such revocation. 7. Acknowledgements. Aareements and Assurances on the Part of the Developer. The parties acknowledge and agree that Developer's faithful performance in developing the Project on the Site, pursuant to the terms of this Agreement and in constructing and installing public improvements, making payments and complying with the Applicable Rules will fulfill substantial public needs. The City acknowledges and agrees that there is good and valuable consideration to the City resulting from 4165.., Developer's assurances and faithful performance thereof and that same is in balance with the benefits conferred by the City on the Project and the Developer by this Agreement. In consideration of the foregoing and the City's assurances set out in Section 8 below, Developer makes the covenants set forth in this Agreement. 8. Acknowledgments, Agreements and Assurances on the Part of the Citv. In order to effectuate the provisions of this Agreement and in consideration for the Developer to obligate itself to carry out the covenants and conditions set forth in the preceding Section 7 of this Agreement, the City agrees and assures Developer that Developer will be permitted to carry out and complete the development of the Project within the Site, subject to the terms and conditions of this Agreement, the conditions of the Project Approvals and the Applicable Rules, as modified by this Agreement. Therefore, the City agrees and acknowledges that: (a) Entitlement to Develop. The Developer is granted the vested right to develop the Project on the Site to the extent and in the manner provided in this Agreement, subject to the Applicable Rules, as modified by this Agreement, and, should the City make the findings set forth below in this subparagraph (a), any "Subsequent Applicable Rules." Any change in the Applicable Rules, including, without limitation, any change in the General Plan, any applicable Specific Plan, Zoning Ordinance, growth management regulations, design standards or any subdivision regulation of the City, adopted or becoming effective after the Effective Date, cannot be applied by the City to the Project on the Site. Subsequent Applicable Rules can be applied to the Site by the City only if, after public hearing, (1) the City determines that the failure of the City to apply Subsequent Applicable Rules will place residents of the City in a condition substantially dangerous to their health or safety, which condition cannot otherwise be mitigated in a reasonable manner and (2) it is applied consistently and evenly to all other similar developments in the City. Subsequent Applicable Rules with regard to increases in existing permit fees imposed by the City (i.e., fees intended to cover the City's processing costs) and not otherwise restricted by the terms of this Agreement, may, notwithstanding the above, be imposed on Developer. In the event that a state or federal law or regulation is enacted after this Agreement has been entered into, which would prevent or preclude compliance with one or more provisions of the Agreement, such provisions of the Agreement must be modified or suspended as may be necessary to comply with such state or federal law or regulation. (b) Subsequent Discretionary Actions. With respect to any Discretionary Action or Discretionary Approval that is, or may be required subsequent to the execution of this Agreement, the City agrees that it will not unreasonably withhold from Developer or unreasonably condition or delay any such Discretionary Action or Discretionary Approval which must be issued by the City in order for the development of the Project Site to proceed unless the City determines that (1) the failure to impose such condition would place residents of the City in a condition substantially dangerous to their health or safety, which condition cannot otherwise be mitigated in a reasonable manner 4165. , g and (2) such condition is applied consistently and evenly to all other similar developments in the City. Moreover, in the event that a state or federal law or regulation is enacted after this Agreement has been entered into, which would prevent or preclude compliance with one or more provisions of the Agreement, such provisions of the Agreement will be modified or suspended as may be necessary to comply with such state or federal law or regulation. 9. Vesting of Development Rights. In Pardee Construction Co. v. City of Camarillo, 37 Cal.3d 465 (1984), the California Supreme Court held that the failure of the parties therein to provide for the timing or rate of development resulted in a after - adopted initiative restricting the rate of development to prevail against the parties' agreement. City and Developer intend to avoid the result in Pardee by acknowledging and providing that Developer shall have the right, without obligation, except as otherwise specifically set forth herein, to develop the Property in such order and at such rate and times as Developer deems appropriate within the exercise of its subjective business judgment subject to the term of this Agreement. In furtherance of the City's and Developer's intent, as set forth in this Section, no future amendment of any existing City ordinance or resolution, or future adoption of any ordinance, resolution or other action, that purports to limit the rate or timing of development over time or alter the sequencing of development phases, whether adopted or imposed by the City Council or through the initiative or referendum process, shall apply to the Site. However, nothing in this section shall be construed to limit City's right to enforce Developer's obligation pursuant to this Agreement to provide all infrastructure required by the Project Approvals and this Agreement. 10. Benefits to the City. The Developer agrees to contribute to the City an additional sum as an enhanced community benefit to be paid to the City annually for a period of five (5) years beginning upon the effective date of this Development Agreement. The Developer will be permitted to use any excess parking spaces for an off -site airport parking use located in the parking structure at 892 North Sepulveda Boulevard. The number of excess parking spaces is determined by the number of spaces that are not required by the El Segundo Municipal Code for use by the existing office building at 898 North Sepulveda Boulevard. The airport parking use is permitted on an interim basis in a manner consistent with Administrative Use Permit No. 94 -6, until a Certificate of Occupancy is issued for the proposed office building. This payment will cease after five (5) years or on the date that a Certificate of Occupancy is issued for the proposed building, whichever occurs first. The payment schedule is as follows: Year 1: $12,000 (to be paid upon the effective date of this Development Agreement) Year 2: $12,000 (due 12 months after the proceeding payment) Year 3: $18,000 (due 12 months after the proceeding payment) Year 4: $18,000 (due 12 months after the proceeding payment) Year 5: $18,000 (due 12 months after the proceeding payment) The City will benefit from increased sales taxes derived from retail sales to occupants of the Project. Further, the Developer agrees to contribute to the City the sum of One- 4165 Hundred Fifty Thousand Dollars ($150,000) for the cost of landscaping, median, visual, and other improvements to Sepulveda Boulevard in the vicinity of the Site. The City shall, at its sole discretion determine which improvements the Developer's contribution shall be used for. The payment shall be made before the City's issuance of a Certificate of Occupancy for the first tenant improvement associated with the Development Project, excluding a building /management and leasing office which shall not trigger the contribution obligation. Any such work shall be performed by the City. 11. Cooperation and Implementation. The City agrees that it will cooperate with Developer to the fullest extent reasonable and feasible to implement this Agreement. Upon satisfactory performance by Developer of all required preliminary conditions, actions and payments, the City will commence and in a timely manner proceed to complete all steps necessary for the implementation of this Agreement and the development of the Project or Site in accordance with the terms of this Agreement. Developer must, in a timely manner, provide the City with all documents, plans, and other information necessary for the City to carry out its obligations under this agreement. 12. Review of Compliance. (a) Periodic Review. The City Manager of the City will review this Agreement annually, on or before the anniversary of the Effective Date, in accordance with the procedure and standards set forth in this Agreement and the El Segundo Municipal Code in order to ascertain compliance by the Developer with the terms of this Agreement. (b) Special Review. The City Council of the City may order a special review of compliance with this Agreement at any time but not to exceed twice per year. The Director of Planning and Building Safety or the City Council, as determined by the City Council, must conduct such special reviews. (c) Procedure. During either a periodic review or a special review, the Developer is required to demonstrate good faith compliance with the terms of this Agreement. The burden of proof on this issue shall be on the Developer. The parties acknowledge that failure by the Developer to demonstrate good faith compliance constitutes grounds for termination or modification of this Agreement in accordance with Government Code § 65865.1. 13. Default Provisions. (a) Default. Either party to this Agreement is deemed to have breached this Agreement if it materially breaches any of the provisions of the Agreement and the same is not cured within the time set forth in a written notice of violation from the non - breaching party to the breaching party, which period of time cannot be less than ten (10) days for monetary defaults, and not less than sixty (60) days for non - monetary defaults from the date that the notice is deemed received, provided if the breaching party cannot 4 ? 5 5 . t0 reasonably cure a non — monetary breach within the time set forth in the notice, then the breaching party cannot be in default if it commences to cure the breach within such time limit and diligently effects such cure thereafter. If the City determines to proceed with termination of this Agreement, the City must give written notice to the Developer of its intention to terminate this Agreement and comply with the notice and public hearing requirements of Government Code §§ 65867 and 65868. At the time and place set forth in the hearing on termination, the Developer must be given an opportunity to be heard. If the City Council finds based upon the evidence that the Developer is in breach of the Agreement, the Council may modify or terminate this Agreement. (b) Content of Notice of Violation. Every notice of violation must state with specificity that it is given pursuant to this Section of the Agreement, the nature of the alleged breach, and the manner in which the breach may be satisfactorily cured. The notice is deemed given on the date that it is personally delivered or on the date that is three (3) business days after it is deposited in the United States mail, in accordance with Section 21 hereof. (c) Remedies for Breach. The Parties agree that remedies for breach of the Agreement is limited to the remedies expressly set forth in this subsection. The remedies for breach of the Agreement by City or Developer are limited to injunctive relief and /or specific performance except in the event of a monetary default by Developer the City is entitled to seek any remedy available to it at law or in equity. 14. Mortgagee Protection: At the same time that City gives notice to the Developer of a breach, City must send a copy of the notice to each holder of record of any deed of trust on the portion of the Site in which Developer has a legal interest ( "Financier "), provided that the Financier has given prior written notice of its name and mailing address to City and the notice makes specific reference to this Section 14. The copies must be sent by United States mail, registered or certified, postage prepaid, return receipt requested, and are deemed received upon the third (3`d) day after deposit. Each Financier that has given prior notice to City pursuant to this Section has the right, at its option and insofar as the rights of City are concerned, to cure any such breach within sixty (60) days after the receipt of the notice from City. If such breach cannot be cured within such time period, the Financier may have such additional period as may be reasonably required to cure the same, provided that the Financier gives notice to City of its intention to cure and commences the cure within sixty (60) days after receipt of the notice for City and thereafter diligently prosecutes the same to completion. City cannot commence legal action against Developer by reason of Developer's breach without allowing the Financier to cure the same as specified herein. Notwithstanding any cure by Financier, this Agreement is binding and effective against the Financier and every owner of the Site, or part thereof, whose title thereto is acquired by foreclosure, trustee sale or otherwise. 15. Estoppel Certificate. At any time and from time to time, Developer may deliver written notice to City and City may deliver written notice to the Developer requesting that such party certify in writing that, to the knowledge of the certified party (i) 4165. '' this Agreement is in full force and effect and a binding obligation of the parties, (ii) this Agreement has not been amended, or if amended, the identity of each amendment, and (iii) the requesting party is not in breach of this Agreement, or if in breach, a description of each such breach. The party receiving such a request must execute and return the certificate within thirty (30) days following receipt of the notice. City acknowledges that a certificate may be relied upon by successors in interest to the Developer who requested the certificate and by holders of record of deeds of trust on the portion of the Site in which that Developer has a legal interest. 16. Operating Memoranda and Amendments of Development Agreement (a) Operating Memoranda. The Parties acknowledge that the provisions of the Agreement require a close degree of cooperation and that new information and future events may demonstrate that changes are appropriate with respect to the details of performance of the Parties under this Agreement. The Parties desire, therefore, to retain a certain degree of flexibility with respect to the details of performance for those items covered in general terms under this Agreement. If and when, from time to time, the Parties find that refinements or adjustments are desirable, such refinements or adjustments will be accomplished through operating memoranda or implementation agreements approved by the Parties which, after execution, will be attached to this Agreement as addenda and become a part hereof. Operating memoranda or implementation agreements may be executed on behalf of the City by the City Manager and the City Attorney. In the event a particular subject requires notice or hearing, such notice or hearing will be appropriately given. Any significant modification to the terms of performance under this Agreement will be processed as an amendment of this Agreement in accordance with applicable rules and must be approved by the City Council. (b) Amendments. This Agreement may be amended from time to time only upon the mutual written consent of City and Developer; provided, however, that in connection with the transfer of any portion of Developer's rights or obligations under this Agreement to another developer, Developer (or any assignee of Developer's rights), such other developer and City may agree that the signature of such other developer may be required to amend this Agreement insofar as such amendment would materially alter the rights or obligations of such developer hereunder. In no event will the signature or consent of any "Non- Assuming Transferee" (defined below) be required to amend this Agreement. (c) Minor Changes. Any change to this Agreement which does not substantially affect (i) the Term of this Agreement, (ii) permitted uses of the Project Site, (iii) provisions for the reservation or dedication of land, (iv) conditions, terms, restrictions or requirements for subsequent discretionary actions, (v) the density or intensity of use of the Project Site or the maximum height or size of proposed buildings or (vi) monetary contributions by Developer, will, with Developer's consent, be subject to the review and 10 4165.,. / approval of the City's city manager (the "City Manager ") and not require notice or public hearing, except to the extent otherwise required by law. (d) Future Development Agreements. Except as otherwise consented to by Developer, any future development agreement that may be entered into between City and a successor or assign of Developer with respect to any portion of the Project Site must be consistent with the terms and provisions of this Agreement. (e) Future Approvals Do Not Require Amendments to Development Agreement. Except as may be otherwise agreed to by the parties, no amendment of this Agreement is required in connection with the issuance of any Discretionary Approval. Any Discretionary Approval issued after the Effective Date will automatically be incorporated into this Agreement and vested hereby. City will not issue any Discretionary Approval for any portion of the Project Site unless Developer requests such Discretionary Approval from City. 17. Term of Agreement. This Agreement becomes operative and begins upon the Effective Date and remains in effect for a term of five (5) years, unless said term is terminated, modified, or extended by circumstance set forth in this Agreement or by mutual consent of the parties hereto. Following the expiration of said term, this Agreement is deemed terminated and of no further force and effect; provided, such termination does not automatically affect any right of the City or Developer arising from City approvals on the Project before the expiration of the term or arising from the duties of the parties as prescribed in this Agreement. 18. Administration of Agreement and Resolution of Disputes. All decisions by the City staff concerning the interpretation and, administration of this Agreement and the Project which is the subject hereof are appealable to the City Council and all like decisions by the City Council are final. However, decisions of the City Council shall also be subject to judicial review pursuant to Code of Civil Procedure § 1094.5. so long as such action is filed in a court of competent jurisdiction not later than ninety (90) days following the date on which the City's decision becomes final pursuant to Code of Civil Procedure § 1094.6. 19. Notices. All notices under this Agreement must be in writing and are effective when personally delivered or upon the third (3rd) day after deposit in the United States mail as registered or certified mail, postage prepaid, return receipt requested, to the following representatives of the parties at the addresses indicated below: If to the City: City of El Segundo 350 Main Street El Segundo, California 90245 Attn: Director of Planning and Building Safety 11 4165. With a copy to: Jenkins & Hogin, LLP 1230 Rosecrans Avenue, Suite 110 Manhattan Beach, CA 90266 Attn: Mark Hensley If to Developer: Realty Associates Advisors, LLC 1301 Dove Street, Suite 860 Newport Beach, CA 92660 Attn: Cliff Chandler With a copy to: 898 Sepulveda Associates, LLC 4 Park Plaza, Suite 700 Irvine, CA 92614 Attn: David Drake Any party may, from time to time, by written notice to the other, designate a different address which shall be substituted for the one above. 20. Severability and Termination. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable, or if any provision of this Agreement is superseded or rendered unenforceable according to any law which becomes effective after the Effective Date, the remainder of this Agreement shall be effective to the extent the remaining provisions are not rendered impractical to perform, taking into consideration the purposes of this Agreement. 21. Time of Essence. Time is of the essence for each provision of this Agreement of which time is an element. 22. Force Maieure. In the event of changed conditions, changes in local, state or federal laws or regulations, floods, delays due to strikes, inability to obtain materials, civil commotion, fire, or other circumstances which substantially interfere with carrying out the Project, as approved by the City, or with the ability of either party to perform its obligations under this Agreement, and which are not due to actions of Developer and are beyond its reasonable control, the parties agree to bargain in good faith to modify such obligations to achieve the goals and preserve the original intent of this Agreement. 23. Waiver. No waiver of any provision of this Agreement constitutes a waiver of any other provision, whether or not similar; nor does any such waiver constitute a continuing or subsequent waiver of the same provision. No waiver is binding, unless it is executed in writing by a duly authorized representative of the party against whom enforcement of the waiver is sought. 24. Entire Agreement. This Agreement contains the entire agreement between the Parties regarding the subject matter hereof, and all prior agreements or 12 4165., ,'4 understandings, oral or written, are hereby merged herein. This Agreement cannot be amended, except as expressly provided herein. 25. Relationship of the Parties. Each party acknowledges that, in entering into and performing under this Agreement, it is acting as an independent entity and not as an agent of any of the other Party in any respect. Nothing contained herein or in any document executed in connection herewith may be construed as creating the relationship of partners, joint ventures or any other association of any kind or nature between City and Developer, jointly or severally. 26. Rules of Construction. The captions and headings of the various sections and subsections of this Agreement are for convenience of reference only, and they do not constitute a pact of this Agreement for any other purpose or affect interpretation of the Agreement. Should any provision of this Agreement be found to be in conflict with any provision of the Project Approvals or the Subsequent Approvals, the provisions of this Agreement shall prevail over the Project Approvals. 27. Constructive Notice and Acceptance. Every person who, now or hereafter, owns or acquires any right, title or interest in or to any portion of the Project Site is conclusively deemed to have consented and agreed to every provision contained herein, whether or not any reference to this Agreement is contained in the instrument by which such person acquired such right, title or interest in the Project Site. 28. No Third Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit of the Parties and their successors and assigns. No other person has any right of action based upon any provision of this Agreement. 29. Incorporation of Exhibits. The following Exhibits are part of this Agreement and each of which are incorporated herein by this reference: Exhibit A -1 Legal Description of Parcel 1 Exhibit A -2 Legal Description of Parcel 2 Exhibit B Description of the Projects Exhibit C Form of Assignment and Assumption 30. Entire Agreement Conflicts. This Agreement represents the entire agreement of the parties. Should any or all of the provisions of this Agreement be found to be in conflict with any provision or provisions found in the Project Approvals, Applicable Rules, or Subsequent Applicable Rules, then the provision(s) of this Agreement prevail. 31. Release Upon Transfer. Upon the sale or transfer of the Developer's interest in any portion of the Property, except as otherwise provided herein, Developer is released from its obligations with respect to the portion so sold or transferred subsequent to the effective date of the sale or transfer and the City's sole remedy is against the assignee or its successor or assign, provided that (i) Developer is not in 13 4165 . , , 15 breach of this Agreement at the time of the sale or transfer and (ii) before the sale or transfer, Developer delivers to City a written assignment and assumption agreement in the four attached hereto as Exhibit "C," duly executed by the purchaser or transferee and notarized by a notary public, whereby the purchaser or transferee expressly assumes the obligations of Developer under this Agreement with respect to the sold or transferred portion of the Property. Failure to provide a written assumption agreement hereunder does not negate, modify or otherwise affect the liability of the purchaser or transferee pursuant to this Agreement. Nothing contained herein may be deemed to grant to City discretion to approve or deny any such sale or transfer. 32. Hold Harmless. The Developer hereby agrees to and must defend, protect, save and hold the City and its elected and appointed boards, commissions, officers, agents and employees harmless from any and all claims, costs, losses, fines, penalties, demands, injuries, judgments and /or liabilities for any damages arising out of, or resulting from, the City's approval of this Agreement or either party's performance pursuant to this Agreement; provided, however, that the Developer is not required to indemnify the City from its negligence or willful misconduct; and further provided that the Developer may elect to legally challenge the City's implementation or interpretation of this Agreement. 33. Joint Preparation. This Agreement is deemed to have been prepared jointly and equally by the Parties, and it cannot be construed against any party on the ground that the Party prepared the Agreement or caused it to be prepared. 34. Governing Law and Venue. This Agreement is made, entered into, and executed in the County of Los Angeles, California, and the laws of the State of California govern its interpretation and enforcement. Any action, suit or proceeding related to, or arising from, this Agreement must be filed in the appropriate court having jurisdiction in the County of Los Angeles. 35. Counterparts. This Agreement may be executed in multiple counterparts, each of which is deemed an original, but all of which constitute one and the same instrument. IN WITNESS WHEREOF, the Parties have each executed this Agreement of the date first written above CITY EGUNDO By: Mayor ATTEST: Gk4bwwl g,7v CindyWAortesen, City Clerk 14 4165.,,,' April 26, 2011 STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) SS CITY OF EL SEGUNDO ) On April 19, 2011, before me, Cathy Domann, Deputy City Clerk, personally appeared Eric K. Busch, Mayor of the City of El Segundo, who 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 entity upon behalf of which the persons acted, executed the instrument. I certify under the Penalty of Perjury under the laws of the Sate of California that the foregoing paragraph is true and correct. Witness my hand and Official Seal. C��&XOIK-x Cathy Do ann, Deputy City Clerk 41 65 . . /� APPROFED AS TO FORM: Mark D. Hensley City Attorney REALTY ASSOCIATES ADVISORS, LLC, a Delaware limited liability company By: Name: Scott w A .,,ling Its" Regional I)irector 15 State of California County of Orange On APri ( 22, 2 D 11 before me, Carmen Lee, Notary Public, personally appeared 5(o+ W. A m l i h v) who proved to me on the basis of satisfactory evidence to be the person(i) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his /her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. CARMEN LEE G�5:"Cftlljon om s 190938 Notary Public . Calftme Orange County ^ Signature (Seal) � Expires Nora 2014 4165. 'q EXHIBIT A -1 Legal Description of Parcel 1 (898 North Sepulveda Boulevard) Parcel 1 of Parcel Map No. 11008, in the City of El Segundo, County of Los Angeles, State of California, as shown on the Map filed in Book 123, Page 1 of Parcel Map in the Office of the County Recorder of said County. EXHIBIT A -1 -1- `d EXHIBIT A -2 Legal Description of Parcel 2 (888 North Sepulveda Boulevard and 892 North Sepulveda Boulevard) Parcel 2 of Parcel Map No. 11008, in the City of El Segundo, County of Los Angeles, State of California, as shown on the Map filed in Book 123, Page 1 of Parcel Maps, in the Office of the County Recorder of said County. EXHIBIT A -2 —I- EXHIBIT "B" Descriation of Project The Project consists of the development of an office building ten (10) stories or less, but not to exceed 200 feet in height, consisting of a maximum of eighty eight thousand eight hundred and forty seven (88,847) square feet with a Floor Area Ratio ( "FAR ") of 0.8., with parking provided by the existing parking structure located on Parcel 2, with an additional 17 surface parking stalls. The existing "Park and Ride" business would be permanently revoked and the use would be discontinued upon the issuance of a Certificate of Occupancy for the first tenant improvement associated with the Project, provided that the occupancy of a building management /leasing office will not trigger such revocation. EXHIBIT "B" . " P_ EXHIBIT "C" ASSIGNMENT AND ASSUMPTION This Assignment and Assumption is entered into as of this — day of 2011, by and between Realty Advisors Associates, LLC, A Delaware Limited Liability Company ( "Assignor ") and ( "Assignee ") with respect to the following facts: RECITALS: A. Assignor is the "Developer" with respect to that certain Development Agreement dated , (the "Development Agreement ") by and between Assignor and the City of El Segundo, a city in the State of California ( "City "). B. The Development Agreement pertains to that certain real property located in the City consisting of 888, 892 and 898 North Sepulveda Boulevard (collectively, the "Site "). C. By this Assignment and Assumption, Assignor desires to assign all its right, title and interest in and to the Development Agreement to Assignee and Assignee desires to assume all of Developer's interest and obligations with respect to the Development Agreement. NOW, THEREFORE, for good and other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Assignor and Assignee hereby agree as follows: 1. Assignment of Development Agreement. Assignor hereby grants, assigns, transfers, conveys and delivers to Assignee all of its right, title and interest in and to the Development Agreement and Assignee hereby accepts such assignment. 2. As -Is; Non - Recourse. Assignee hereby acknowledges and represents that Assignee has had a full and complete opportunity to evaluate the Development Agreement and the Site. Assignee acknowledges and represents that Assignee accepts the assignment of Assignor's interest in the Development Agreement on an "AS IS" basis, without any recourse to Assignor, and without any representation or warranty of any kind with respect to the terms and conditions of the Development Agreement and/or the obligations of "Developer" under the Development Agreement. 3. Assumption of Obligations. By acceptance of this Assignment, Assignee hereby assumes and agrees to perform and to be bound by all the terms, conditions, covenants and obligations imposed upon or assumed by Assignor under the Development Agreement. EXHIBIT "C" 4 ?5 4. Miscellaneous. (a) Notices. All notices or other communications provided for or permitted hereunder shall be made in writing by hand - delivery, or pre -paid first -class mail: If to Assignor: Realty Advisors Associates, LLC, A Delaware Limited Liability Company If to Assignee: ALL SUCH NOTICES AND COMMUNICATIONS SHALL BE DEEMED TO HAVE BEEN DULY GIVEN: WHEN DELIVERED BY HAND, IF PERSONALLY DELIVERED; AND TWO BUSINESS DAYS AFTER BEING DEPOSITED IN THE MAIL, POSTAGE PRE -PAID, IF MAILED AS AFORESAID. ANY PARTY MAY FROM TIME TO TIME, BY WRITTEN NOTICE TO THE OTHER, DESIGNATE A DIFFERENT ADDRESS WHICH SHALL BE SUBSTITUTED FOR THAT SPECIFIED ABOVE. (b) Captions and Headings. The captions and headings in this Assignment for convenience of reference only and shall not limit or otherwise affect the meaning hereof. (c) Time of Essence. Except as otherwise provided herein, time is of the essence with respect to all provisions of this Assignment in which a definite time for performance is specified; provided, however, that the foregoing shall not be construed to limit or deprive a party of the benefit of any grace period provided for in this Assignment. (d) Interpretation and Governing Law. This Assignment shall be governed by and construed in accordance with the internal laws of the State of California applicable to agreements made and to be performed within the state. The provisions of this Assignment shall be interpreted in a reasonable manner to effect the purpose of the parties and this Assignment. Accordingly, any rule of law (including California Civil Code Section 1654) or legal decision that would require interpretation of any ambiguities in this Assignment against the party that has drafted it is not applicable and is waived. (e) Waiver of Jury Trial. The parties hereby waive their respective right to trial by jury of any cause of action, claim, counterclaim or cross - complaint in any action, proceeding or hearing brought by a party hereto or its successors and assigns on any matter whatsoever arising out of, or in any way connected with, this Assignment, the relationship of the parties hereto, or the enforcement of any remedy under any law, statute, or regulation, emergency or otherwise, now or hereafter in effect. (f) Severability. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of EXHIBIT "C" 4165.. ..A any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired or affected, it being intended that all other rights and privileges shall be enforceable to the fullest extent permitted by law. (g) Attorneys' Fees. In any action or proceeding brought to enforce or interpret any provision of this Assignment, or where any provision hereof is validly asserted as a defense, the prevailing party shall be entitled to recover actual attorneys' fees and all other litigation costs including without limitation costs awardable pursuant to California Code of Civil Procedure Section 1033.5 and amounts payable to expert witnesses ( "Costs ") in addition to any other available remedy. In addition to the fees and Costs recoverable under the preceding sentence, the parties agree that the prevailing party shall be entitled to recover actual attorneys' fees and Costs incurred in connection with the enforcement of a judgment arising from such action or proceeding. (h) Entire Agreement. This Assignment is intended by the parties as a final expression of their agreement and is intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. This Assignment supersedes any and all prior restrictions, promises, representations, warranties, agreements, understandings and undertakings between the parties with respect to such subject matter and there are no restrictions, promises, representations, warranties, agreements, understandings or undertakings with respect to such subject matter other than those set forth or referred to herein. (i) Waiver. No delay on the part of any party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party hereto of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder. 0) Amendments. Neither this Assignment nor any term hereof may be changed, waived, discharged or terminated orally or in writing, except that any term of this Assignment may be amended by a writing signed by the parties, and the observance of any such term may be waived (either generally or in a particular instance and either retroactively or prospectively) by a writing signed by the party against whom such waiver is to be asserted. (k) Successors and Assigns. This Assignment shall inure to the benefit of and be binding upon the successors and permitted assigns of each of the parties. (1) No Third Party Beneficiaries. Nothing expressed or mentioned in this Assignment is intended or shall be construed to give any person, other than the parties hereto and their respective successors and assigns, any legal or equitable right, remedy or claim under or in respect of this Assignment or any provisions herein contained, this Assignment and any conditions and provisions hereof being intended to be EXHIBIT "C" 4165, . .0P and being for the sole and exclusive benefit of the parties hereto and their respective successors and assigns, and for the benefit of no other person. (m) Counterparts. This Assignment may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. 5. Facsimile. This Assignment may be executed by a party's signature transmitted by facsimile ( "fax "), and copies of this Assignment executed and delivered by means of faxed signatures shall have the same force and effect as copies hereof executed and delivered with original signatures. All parties hereto may rely upon faxed signatures as if such signatures were originals. Any party executing and delivering this Assignment by fax shall promptly thereafter deliver a counterpart signature page of this Assignment containing said party's original signature. All parties hereto agree that a faxed signature page may be introduced into evidence in any proceeding arising out of or related to this Assignment as if it were an original signature page. "ASSIGNOR" Realty Advisors Associates, LLC, A Delaware Limited Liability Company By: Name: Its: "ASSIGNEE" EXHIBIT "C"