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Home My WebLink AboutC-3133 - John Wayne Gulch Easement Agreement• 0 (f-Z /33 COX. CASTLE F3 NICHOLSON, LLP PHILLIP R. NICHOLSON KENNETH WILLIAM$ A LIMITED LIABILITY PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS GEORGE M. CO. LAWRENCE iE PLIN RONALD I. SILVERMAN' LAUREL BALLARD BRYAN . WFLIB LAWYERS (RETIRE.) MARIO CAMARA SCOTT D. BROOKS GEORGE O. CALKINS. It GARY P. DOWNS ORANGE COUNTY OFFICE RICHARD N. CASTLE JOHN H KVHI VALERIE L. "RES (1932-1992) ARTHUR O SPAULDING, JR, HERBERT J RLDD 19800 MACARTHUR BOULEVARD JEFFREY LAPOTA CARLISLE G. PACKARD DAVID A. LEIPZIGER DAVID S. ROSENBERG SUITE 600 OF C ... SEI JOHN S. MILLER, JR. SUSAN 0 DAVIS JAMES E. BARNETT KENNETH B. BLEY LISA A. WEINBERG IRVINE, CALIFORNIA 92612-2435 EDWARD C. OY.ERT IRA J. WALDMAN CYNTHIA K, SIMONS JOHN F NICHOLSON SHARON L. TAMPA TELEPHONE (714) 476 -2111 CHARLES C NONEMAN ESTELLE M. SRAAF LOS ANGELES OFFICE WILLIAM KAMER PRESTON W BROOKS (310) 284-2187 2049 CENTURY PARK EAST MARLENE O. GOODFRIEO sTATHI C MARCOPULOS BARRY P JABLON SHERRY M DV PONT TWENTY'EIGHTH FLDOR JEFFREY O MASTERS MARK MOORS FACSIMILE (714) 476 -0256 LOS ANGELES, CALIFORNIA 900673284 ROBERT O. INFEUSE SCOTT PRICE 13101 2JJ 9222 TAMAR C. STEIN DOUGLAS P. SNYDER COLIN C. SWAINSTON ROBERT J EYKES FACSIMILE (310) 271-16B9 GARY A. GLI EK PAUL J. TITCHER LORA LEE MOORE ADAM 0 WEISSBVRG LEWIS C FELDMAN CHRISTINE COSTA R JEROLD WALSH JOHN A HENNING.IN. April 18, 1997 MARK P. MCCLAMATHAN STEPHANIE A H SCROEDER JOHN A INCANNON CAMELLIA KUO SCHVK STANLEY W MPORT SCOTT L. GROSSFELO RANDALL W BLACK PERRY O. MOCCIARO ROBERT M HAIGHT, JR. MARK T LAMMAS OUR FILE NO: JE55 R. BRES51 NNE MARIE READER GREGORY J. KARNS JOHN 0 ROSENFELD 27945 O. SCOTT TURNER EDWARD F. OUIGLEY II SAMUEL H GRUENBAVM DANIEL J VILLALPANDO BANORA C. STEWART KEVIN J. CRABTREE _ ., - F' ,,. WRITER'S DIRECT DIAL NUMBER MATHEW A, WYMAN MARIA V. BERNSTEIN RANDY P. C.UI (714) 260-4620 Robert H. Burnham, Esq. City Attorney The City of Newport Beach 330 Newport Boulevard Newport Beach, CA 92658 -8915 Re: John Wayne Gulch Easement Agreement Dear Bob: Enclosed for your files is a copy of the fully executed and recorded Easement Agreement and Grant of Easement regarding the Newporter Parcel. The document was recorded on April 3, 1997, as Instrument No. 19970153226. Thank you for your assistance in moving this matter forward. Also enclosed as promised a while back is a copy of the Development Agreement we negotiated with the City of Cathedral City regarding Lawrence Welk's Desert Oasis Resort. Please let me know if you need any additional information regarding that matter. We look forward to working with you in connection with the Newporter development. AOS /jt Enclosures aospauld 27945 26573 cc: James B. Mr. John Young, Esq. G. Coulter Sincere , AriKuArO. paulding, Jr. J pECGagING WOOS -=o By RECORDING REQUESTED BY FIRST AMERICAN TITLE INS. CO. WHEN RECORDED NAIL TO: Recorded in the Count Gary L. Gran 11 y of Orange, California io 59 00corder 006 231017603 a7 s3 509970153226 2; 02pm 04103197 001 00 0.00 0.. 00 0.00 14.00 0.00 45.00 0.00 0.00 0.00 ZG Properties, L.L.C. J 0 c/o Jack Coulter �0 / 21772 Montbury Drive Lake Forest, CA 92630 -6506 THIS SPACE FOR RECORDER'S USE ONLY THIS PAGE ADDED TO PROVIDE ADEQUATE SPACE FOR RECORDING INFORMATION (ADDITIONAL RECORDING FEE APPLIES) �t 2 z f � o 0'F • . At EASEMENT AGREEMENT AND GRANT OF EASEMENTS This EASEMENT AGREEMENT AND GRANT OF EASEMENTS (the "Easement Agreement ") is entered into as of February 3 , 1997, by and between The Irvine Company, a Michigan Corporation ( "Grantor "), and ZG PROPERTIES, L.L.C., a California limited liability company ( "Grantee "), whose members are Joseph J. Zilber and J. Stephen Goodfellow, individuals. RECITALS A. Grantor is the sole owner of that certain real property (the "Easement Area ") situated in the County of Orange, State of California, more particularly described on Exhibit "I ", attached hereto and incorporated herein. The Easement Area is part of a larger parcel of real property (the "John Wayne Gulch ") which is proposed to be dedicated by Grantor to the City of Newport Beach (the "City") for open space purposes under terms of a Circulation improvement and Open Space Agreement between Grantor and the City. The Easement Area contains approximately 34,014 square feet. For purposes of this Agreement, the party which owns John Wayne Gulch is hereinafter referred to as the "Owner ". B. The Easement Area is immediately adjacent to a parcel of real property (the "Development Parcel ") containing approximately 5.4 acres and situated in the County of Orange, State of California, more particularly described on Exhibit "T', attached hereto and incorporated herein. Grantee is acquiring the Development Parcel for purposes of constructing a timeshare resort thereon. The Development Parcel is currently a portion of a larger parcel of real property (the "Hotel Parcel ") on which that certain resort hotel commonly known as the "Newporter" is located. The Hotel Parcel is owned in fee by HAC Real Estate Corp. B ( "HAC ") and is subject to a ground lease (the "Ground Lease ") in favor of Patriot American Hospitality, Inc. ( "Patriot "). The obligations of Patriot under the Ground Lease have been assumed by NorthCoast Hotels L.L.C. ( "NorthCoast ") C. The Hotel Parcel contains an executive golf course and a portion thereof encroaches into John Wayne Gulch. The encroachment is described by the boundaries of the Easement Parcel, In addition, Grantor is the owner of a fifteen foot wide general easement (the "Perimeter Easement "), recorded June 30, 1992 as Instrument No. 92- 441109 in the official Records of orange county, California. The Perimeter Easement completely surrounds the Hotel Parcel and extends into the Hotel Parcel the distance of fifteen (15) feet from the exterior boundaries of the Hotel Parcel. The Perimeter Easement also affects and encumbers a parcel of property (the "Tennis Club Parcel ") lying adjacent to and immediately to the east of the Development Parcel. The portion of the Perimeter Easement lying along the northerly lines of the Development Parcel and Tennis Club Parcel is hereinafter referred to as the "Development Perimeter Easement" and the property subject to the Development Perimeter Easement is hereinafter referred to as the "Perimeter Easement Parcel" and is more particularly described in Exhibit "3" attached hereto and made a part hereof. D. Grantor desires to grant to Grantee, and Grantee desires to accept the grant of, an easement on, over, across and under the Easement Area for the purposes described and as more particularly set forth below. In order to permit the efficient development of the LWOCA73M9.1 OUB197 11:50am F 0 timeshare project on the Development Parcel, Grantor is also willing to quitclaim the Development Perimeter Easement to Grantee as more particularly set forth below. NOW, THEREFORE, in consideration of the above and the mutual covenants, terms, conditions and restrictions contained in this Easement Agreement, Grantor and Grantee agree as follows. MATTERS OF AGREEMENT 1. Grant of Easements. Subject to the City of Newport Beach approving the terms of this Easement Agreement and agreeing to accept dedication of John Wayne Gulch subject to the following easements, as evidenced by execution of the Acknowledgement and Agreement attached to this Easement Agreement, and further subject to the condition precedent set forth in Section 6 below, Grantor conveys to Grantee, and Grantee accepts, the easements described in Section 2, below, in, over and on the Easement Area in perpetuity and subject to the terms of this Easement Agreement (the "Easements "), which Easements shall be appurtenant to and shall be for the benefit of the Development Parcel and the Hotel Parcel, respectively, as provided in Section 6. Following execution of this Easement Agreement by Grantor and Grantee, and of the Acknowledgement and Agreement by the City of Newport Beach, this Easement Agreement shall be recorded in the Official Records of Orange County, California. 2. Purpose of Easements. The Easements granted hereunder include the following appurtenant rights, which shall be used by Grantee and its successors -in- interest only for the following purposes: (a) Landscape Easement. Grantor grants to Grantee a landscape easement (the "Landscape Easement ") for the construction, repair, maintenance, replacement, provision of utility service to and use of landscaping, waterscaping, and hardscaping (hereinafter collectively referred to as "Landscaping ") in connection with, and together with the right of Grantee and Grantee's guests and permitees to engage in, the recreational use of the Easement Area as a golf course, putting course or other recreational open space improvements installed in association with hotel and timesharing activities conducted or to be conducted upon the Development Parcel and/or the Hotel Parcel. From and after the Recordation Date, Grantee may install small monuments within the Easement Area, including but not limited to fountains, reflection pools, circulating water features, decks, benches, walk -ways, irrigation systems, and unobtrusive lighting (collectively, the "Permitted Improvements ") . (b) Access and Utility Easement. Grantor grants to Grantee an access and utility easement (the "Access Easement ") for access to the Development Parcel for construction of improvements thereon and for the maintenance, repair, replacement and operation of the improvements constructed within the Development Parcel, and for utility purposes. 3. Restrictions Upon Easement Use. Notwithstanding anything to the contrary in Paragraph 2, the following restrictions or conditions shall apply to the use and enjoyment of the Easement Area: r woCIV35M.1 '2- 01//97 u:soom (a) None of the Permitted improvements may exceed six (6) feet in height and each Permitted improvement must be installed in conjunction with Landscaping which is similar in nature to other typical golf course, putting course and /or other landscape installations used within the Development Parcel or the Hotel Parcel. (b) No Landscaping or Permitted improvements may be installed within the Easement Area which extend beyond the Easement Area into other portions of John Wayne Gulch and in no event may any use be made of or installations of Landscaping or Permitted Improvements be made upon the Easement Area which would destabilize the slopes of John Wayne Gulch adjacent to the Easement Area. No utilities may be constructed within the Easement Area unless the main lines for such utilities are located completely underground. (c) No Landscaping or Permitted improvements may be installed within the Easement Area without the prior approval of the City, as more particularly set forth below. For purposes of this paragraph, Grantee shall request approval by submitting its proposed plans for Landscaping and the Permitted Improvements to the City. If no objection is received by Grantee regarding the submitted plans within tan (10) days after the date on which the plans are received by the City, the proposed plans shall be deemed approved and are hereinafter referred to as the "Approved Plans ". Landscaping and Permitted Improvements actually installed within the Easement Area shall not vary materially from the Approved Plans without the prior approval of the City. (d) No Landscaping or Permitted Improvements of any kind may be made or maintained within the Easement Area unless they are to be used in conjunction with uses permitted by the City within the Development Parcel or the Hotel Parcel. 4. Maintenance of Easement Area. From and after the recordation of this Easement Agreement, and subject to the condition precedent set forth in Section 6 below, Grantee shall bear all responsibility, costs and liabilities of any kind concerning the operation and maintenance of the Easement Area, including maintaining commercial general liability insurance coverage from a company acceptable to the Owner in a principal amount of at least $1,000,000.00, and an endorsement to Grantee's policy naming the Owner as an additional insured; provided, however, that if the Landscape Easement is assigned as provided in Section 6, below, and the Access Easement is retained by Grantee or assigned by Grantee as set forth in Section 6, below, the obligations of this section shall be delegated to and be the responsibility of the holder of the Landscape Easement. 5. Quitclaim of Development Perimeter Easement. Subject to the condition precedent set forth in Section 6 below, Grantor quitclaims to Grantee the Development Perimeter Easement. Grantor agrees to deliver to Grantee a recordable quitclaim deed (the "Quitclaim Deed ") in form and substance reasonably acceptable to Grantee, within five (5) business days after receipt by Grantor of a written request therefor from Grantee, containing an accurate and surveyed legal description thereof, which request shall only be made following satisfaction of the condition precedent set forth in Section 6 below. 6. Assienment of Grantee's Interest. Grantor and Grantee acknowledge and agree that the Easements are intended to be appurtenant to the Developer Parcel and the Hotel Parcel as well. Accordingly, Grantee's acquisition of the Development Parcel, or assignment of its rights under this Easement Agreement as provided in the remainder of this Lwoci 35".1 -3- oinsim u:so.m 9 0 Section 6, is a condition precedent to the grant of the Easements, and the quitclaim of the Development Perimeter Easement, and this Easement Agreement. Grantee may assign its interests under this Easement Agreement to such other entity as may be the owner or ground lessee of the Hotel Parcel and /or the Development Parcel (or an association of such owners); provided, however, that any such assignee(s) shall expressly assume all of the obligations of Grantee applicable hereunder to the interests so assigned. Any assignment without such assumption shall be void and of no effect. 7. Successors. The covenants, terms, conditions and restrictions of this Easement Agreement shall be binding on, and inure to the benefit of, the parties hereto and their respective heirs, administrators, executors, personal representatives, successors and permitted assigns and shall constitute a servitude running in perpetuity with the Easement Area. To the extent that any of a parry's rights are transferred and obligations or duties hereunder are delegated and assumed, then, upon the effective date of such transfer and delegation, such rights, obligations and duties of the transferring or delegating party hereto shall terminate, except that any liability of a parry hereto for acts or omissions occurring before such transfer and delegation shall survive. 8. Indemnity. From and after the Recordation Date, Grantee shall defend, indemnify and hold the Grantor, and its partners, directors, officers, employees, agents, affiliates, and contractors and the heirs, successors and assigns of each of them (collectively, the "Indemnified Parties ") harmless from and against any and all liabilities, penalties, costs, losses, damages, expenses, causes of action, claims, demands or judgments, including without limitation reasonable attorneys' fees arising from or in any way connected with injury to or the death of any person, or physical damage to the Easement Area, except (a) such as arise out of or relate to the acts or omissions of the Indemnified Parties and (b) such as arise by reason of facts and circumstances occurring before the Recordation Date. The insurance required by Section 4, above, shall not replace this obligation. 9. General Provisions. (a) Attorneys' Fees. If any lawsuit, reference or arbitration is commenced which arises out of, or which relates to, this Easement Agreement, the prevailing parry shall be entitled to recover from each other party such sums as the court, referee or arbitrator may adjudge to be reasonable attorneys' fees in the action, reference or arbitration, in addition to costs and expenses otherwise allowed by law. In addition to the foregoing, the prevailing party shall be entitled to its reasonable attorneys' fees and all fees, costs and expenses incurred in any post judgment proceedings to collect or enforce the judgment. This provision is separate and several and shall survive the merger of this Easement Agreement into any judgment an this Easement Agreement. (b) Counterparts. This Easement Agreement may be executed in counterparts, but all counterparts shall constitute one and the same document. (c) Business Days. As used herein, the term "business day" means a day upon which the City is open for business. If the last day for performance of an act falls upon a day during which the City is not open for business such last day will be the next following day upon which the City is open for business. i,wocnnsse.i -4- oinsrn 11:50am 0 ! (d) Notices. Any tender, delivery, notice, demand or other communication ( "Notice ") required or permitted under this Agreement shall be in writing, and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, overnight mailed, delivered or sent by telecopier or telefacsimilie machine capable of confirming transmission and receipt, and shall be deemed delivered, given and received upon the earlier of (i) if personally served, the date of delivery to the person to receive such notice; (ii) if given by telecopier or telefacsimilie, the date on which the transmission of the telecopier or telefacsimilie is sent; (iii) if mailed, the date which is four (4) business days after the date of posting by the United States Postal Service; or (iv) if sent by Federal Express or other Comparable overnight delivery service, the date upon which delivery is effected as documented by the service's delivery records, all in accordance with the following: If to Grantee: The Irvine Company 550 Newport Center Drive P.O. Box 6370 Newport Beach, California 92658 -6370 Attn: Norman E. Witt, Jr. FAX: (714) 720 -2111 With a Copy to: Robert K. Break, Esq. Latham & Watkins 650 Town Center Drive 20th Floor Costa Mesa, California 92626 FAX: (714) 755 -8290 If to Grantee: ZG Properties, L. L. C. c/o Towne Realty, Inc. 710 N. Plankinton Avenue Milwaukee, Wisconsin 53203 Attn: James B. Young, Esq. FAX: (414) 274 -2710 With a Copy to: Pacific Rim, Incorporated P.O. Box 598 Wenatchee, Washington 98807 Attn: Mr. John Zapatocky Fax: (509) 662 -2621 With a Copy to: Arthur O. Spaulding, Jr. Cox, Castle & Nicholson, LLP 19800 MacArthur Blvd., Suite 600 Irvine, California 92715 FAX: (714) 476 -0256 If to the City: The City of Newport Beach 3300 Newport Boulevard Newport Beach, California 92658 -8915 Lwocnnsss.1 -5- 01419ro711MM • • Attn: Robert H. Burnham, Esq. FAX: (714) 644 -3139 Any parry may change the address specified in this section by giving the other party notice of such new address in the manner set forth herein. (e) Entire Agreement. This Agreement and the documents and agreement contemplated herein constitute the entire agreement between Grantor and Grantee, and to the limited extent set forth below, the City, with respect to the subject matter hereof, and all prior or contemporaneous oral or written agreements, understandings, statements, representations or warranties between the parties other than those set forth herein or herein provided for, are hereby superseded and merged herein. (f) Modifications. No modification or waiver of any provision of this Agreement shall be binding upon the party against whom it is sought to be enforced, unless specifically set forth in a writing signed by an authorized representative of that parry. A waiver by any parry of any of the terms or conditions of this Agreement in any one instance shall not be deemed or construed to be a waiver of such terms or conditions for the future, or of any subsequent breach thereof. The failure by any party at any time to enforce any of the provisions of this Agreement, or to require at any time performance of any of the provisions hereof, shall in no way be construed to be a waiver of such provisions or to effect either the validity of this Agreement or the right of any party to thereafter enforce each and every provision of this Agreement. (g) Section and Other Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. (h) Invalidi1y. If any material covenant, condition or provision herein contained is held to be invalid, void or unenforceable, the remaining provisions and portions shall nevertheless be carried into effect. (i) Governing Law. This Agreement will be construed and enforced in accordance with and governed by the laws of the State of California. (.I) Time of Essence. Time is of the essence for the performance of each and every obligation hereunder. (k) Approvals. Any approval or consent required to be obtained by a party hereunder shall not be unreasonably delayed, withheld or conditioned by the party requested to provide such approval. (1) Construction. Each party to the transaction evidenced by this Agreement has had an opportunity to participate and has participated in its negotiation and drafting. Accordingly, in construing the terns of this Agreement, all parties shall be deemed to have participated equally and no presumptions shall be made to construe its terms in favor of or against any of the signatories hereto. LWOCI MS69.1 -6- 01M/97 tr:so.m (m) Disoute Resolution. Except as otherwise expressly provided in this Agreement, any controversy arising out of this Agreement shall be heard by a reference pursuant to the provisions of the California Code of Civil Procedure §638, et seq. The parties shall agree upon a single referee who shall be a person experienced in the resolution of sophisticated real estate and real estate financial matters and who shall then try all issues, whether of fact or law, and report a finding and judgment thereon. If the parties are unable to agree upon a referee, either party may seek to have one appointed, pursuant to California Code of Civil Procedure §640. The cost of such proceeding shall initially be borne equally by the parties. However, the prevailing party in such proceeding shall be entitled, in addition to all other costs, to recover its contribution for the cost of the reference as an item of damage and/or recoverable costs. IN WITNESS WHEREOF, the Parties have executed this Easement Agreement on the day and year above written. "GRANTOR" The Irvine Company, a Michigan Corpor4 By:2G Bernard i,A. �Ianigcalco" President, Coastal Community Builders, a division of Irvi. Community Development Compan, Authorized Signatory Assistant Secretary "GRANTEE" ZG Properties, L.L.C. a California limited liability company t wocn7nse.1 -7- arom 11:50= • • ACKNOWLEDGEMENT AND AGREEMENT THE UNDERSIGNED, & y Irl S o(PLA having been duly authorized by all necessary and proper action taken by the ty of Newport Beach, hereby acknowledges that the terns of the foregoing Easement Agreement have been approved by the City of Newport Beach and the city of Newport Beach agrees to accept the dedication of the John Wayne Gulch subject to the Easements to be granted to Grantee by Grantor as hereinabove set forth. Further, the City of Newport Beach agrees to those portions of the Easement Agreement which govern the approval rights of the City of Newport Beach and to act in a manner consistent with the provisions hereof. DATED: This 3 I fday of 199.7. THE CITY OF NEWPORT BEACH �r.!,lll�._.✓ cwocn7356e.1 -8- 01179M 11:5DM 0 STATE OF CALIFORNIA ss. COUNTY OF ORANGE 0 On February 3 , 199 7 before me, the undersigned, a Notary Public in and for said County and State, personally appeared Bernard A. Maniscalco and Daniel C. Hedigan , personally known tome ( diX�fidi�lHtt 34Yd4d�Xl !@SKi9sitXi�6iisRat7ttlicyx ypXdappppe➢ to be the onswhose name)ds are subscribed to the within instrument and a ,Pledged to me that= executed the same in the r p�.M. authorized capacity, and that by , signatureson the instrument the entity upon behalf of which the personsacted, executed the within instrument. ! 7. ,, =9 icial seal. laCarnrniss Orange County y Comm. Dores Oct 1. 1999 �. � STATE OF ss. On , 199_ before me, the undersigned, a Notary Public in and for said County and State, personally appeared Joseph J. Zilber, personally Down 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 as a Member of ZG Properties, L.L.C., a California limited liability company, and that by his signature on the instrument the entity upon behalf of which Joseph J. Zibler acted, executed the within instrument. WITNESS my hand and official seal. Notary Public LWOM73361.1 -9- 01/29/97 11:50= 1] STATE OF CALIFORNIA ss. COUNTY OF ORANGE 0 On February 3 , 199 7 before me, the undersigned, a Notary Public in and for said County and State, personally appeared Bernard A. Maniscalco and Daniel C. Hedigan , personally known to me (dfx�StdNd�i�l�f3ftl #X cPles sl�mR talsPat�tattryc� to be the p onswhose namexis are subscribed to the within instrument and a �gy�ledged to me that executed the same in the r IINM& authorized capacity, and that by ddRR signatureson the instrument the entity upon behalf of which the personsacted, executed the within instrument. .. �..�. a �. . •. official seal. J �FF Corr"Oon IF 1073347 • .p. 1 Pubft 7 Ofonge County my Comm. E)PIres Oct 1. 19W Notary Public STATE OF HAWAII ) ) ss. CITY AND COUNTY OF HONOLULU ) On . Meta& c}- , 199 2 before me, the undersigned, a Notary Public in and for said County and State, personally appeared Joseph J. Zilber, 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 as a Member of ZG Properties, L.L.C., a California limited liability company, and that by his signature on the instrument the entity upon behalf of which Joseph J. Zibler acted, executed the within instrument. WITNESS my hand and official seal. /� C MARMAR� iNOTARY 1 PUBLIC r�i OF N? LWOC1173MISA ,'9' 01/29/97 1I.-Mm r 0 STATE OF tj,WAII ) ss. COUNTY OF-MAUI. ) On —VmAc/1 I , 1994 before me, the undersigned, a Notary Public in and for said County and State, personally appeared J. Stephen Goodfellow, personally known to me to be the person whose name is subscribed to the within instrument and acknowledge to me that he executed the same in his authorized capacity as a Member of ZG Properties, L.L.C., a California limited liability company, and that by his signature o the instrument the entity upon behalf of which J. Stephen Goodfellow acted, executed the within instrument. WITNESS my hand and official seal. P 17-i ot�Rr °s Past. ►a �. It of NP�:0c Notary Public V+w� CA nyrus ift CITItg , la JG- 99 LWOCI%735U.1 -10- ovum nso m 0 Exhibit "1" to the Easement Agreement Legal Description of Easement Area That portion of Block 55 of Irvine's Subdivision in the City of Newport Beach, County of Orange, State of California, as said subdivision is shown on a map recorded in Book 1 Page 88 of Miscellaneous Maps, in the office of the County Recorder of said county, described as follows: Beginning at the northwest comer of Parcel 2 of the Parcel Map recorded in book 17, page 3 of Parcel Maps as recorded in the office of the County Recorder of Orange County on September 4, 1968, thence N. 83 °40'23" E. along the northerly line of said parcel, 182.66 feet to the true point of beginning. Thence along the following described courses: N. 83 °40'23' E. distant 128.49 feet along the northerly line of parcel 2 of P.M. Book 17, page 3, to the comer of said parcel; Thence, S. 56'12'45' E. distant 439.63 feet along the northeasterly line of said parcel; Thence, N. 24'42'18' W. distant 80.23 feet; Thence. N. 12 °48'40' W. distant 42.14 feet; Thence, N. 66'24'04' W. distant 73.34 feet; Thence, N. 60 °40'23' W. distant 214.08 feel; Thence, N. 36'3111W distant 150.69 feet; Thence. S. 50 051'45' W. distant 101.20 feet; Thence, S. 20034'13"W. distant 80.19 feel to the true point of beginning. Subject property consists of an area of 34,014 square feet, more or less. n o- \ 0 0 � 70 NB3'40'25'E ei \. �HYATT- NEWPOPTEP Proposed Additun 0.781 Acres. 34,014 SgFf. I' 0 60_ 120 1'Si� CCLIIlT�1C= i_.._. - - — - J a� 7s N66'24'04'W 7 0 J ?J 76 NI2'48'40'W 42.14' 77 N24- 4213'W NJ 84 LWOCn73J68.1 -11- 01/29/97 I1:50am • • Exhibit "2" to the Easement Agreement Legal Description of Development Parcel THAT PORTION OF A PARCEL MAP IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, RECORDED IN BOOK 17 PAGE 3 OF PARCEL MAPS IN THE OFFICE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT THE MOST NORTHERLY CORNER OF A PARCEL MAP RECORDED IN BOOK 61 PAGE 5 OF PARCEL MAPS IN THE OFFICE OF SAID COUNTY RECORDER; THENCE S33 °47'15 "W ALONG THE WESTERLY LINE OF SAID PARCEL MAP 362.00 FEET; THENCE S36° 12'45 "E 215.50 FEET TO THE NORTHWESTERLY LINE OF JAMBOREE ROAD; THENCE S33 °47'15 "E 345.00 FEET; THENCE N56 012'45 "W 215.50 FEET; THENCE N33 047'15 "E 132.50 FEET; THENCE N04 °58'24 "E 193.36 FEET; THENCE N33 047'15 "E 171.22; THENCE NI 1'12'44"W 187.52 FEET; THENCE N56 °12'43 "W 352.38 FEET; THENCE S83 040'23 "W 127.08 FEET; THENCE SOS* 10'27"W 249.97 FEET; THENCE N84 °49'33"W 141.53 FEET TO A POINT ON A CURVE CONCAVE WESTERLY HAVING A RADIUS OF 840.00 FEET, SAID POINT BEING ON THE EASTERLY LINE OF BACK BAY DRIVE, A RADIAL AT SAID POINT BEARS N75 °03'30 "W; THENCE NORTHERLY ALONG SAID CURVE THROUGH A CENTRAL ANGLE OF 21 016'07" AN ARC DISTANCE OF 311.81 FEET; THENCE N83 °40'23 "E 311.15 FEET ALONG A NORTHERLY LINE OF PARCEL MAP 17 -3; THENCE S56° 12'45 "E ALONG A NORTHERLY LINE OF SAID PARCEL MAP 594.50 FEET TO THE POINT OF BEGINNING. LWOC1\73%8.1 -12- 01119/97 11:502m • 0 Exhibit "3" to the Easement Agreement Leal Description of Perimeter Easement Parcel That certain real property composed of a fifteen (15.00) foot wide strip of land being the northerly fifteen (15 -00) feet of Parcel 2 as shown on a Parcel Map recorded in Book 17, Page 3, of Maps, Office of the County Recorder of Orange County, California, and the northerly fifteen (15.00) feet of Parcel 2 as shown on a Parcel Map recorded in Book 61, Page 5, of Maps, office of the County Recorder of said County. LwoC1173W.1 -13- 01MM 11:50= State of California County of Orange Onmta before me, Monica S. Kutz. Notary personally appeared e,(Ji f1 �J f nu n personally known to me - OR - ❑ proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his/her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), orthe entity upon behalf of which the person(s) acted, executed the instrument. Monica S. Kutz 0 Comm. 01013469 n • NOTARY PUBUC CALIF' 4N ORANGE COUNTY ll Comm EXPIM Ja U. INS J CAPACITY CLAIMED BY SIGNER _ Individual _ Corporate Officer _ Limited Partner _ General Partner _ Attomey -in -Fact _ Trustee(s) _ Guardian/Conservator Other: Signer Is Representing: WITNESS my hand and official seal. DESCRIPTION OF ATTACHED DOCUMENT Title or Type of Document Number of Pages Date of Document Signer(s) Other Than Named Above .1 1900500I.aos 11/08/89 RECORDING REQUESTED BY AND WHEN RECORDED RETURN T0: Welk Park North c/o Cox, Castle i Nicholson 19800 MacArthur Boulevard, Suite 600 Irvine, California 92715 Attention: Arthur 0. Spaulding, Jr., Esq. s $ o m aE �s _j J t� ABOVE THIS LINE FOR RECORDER'S USE ONLY This Development Agreement (the "Develot Agreement ") is pmen June. 1990. made and entered into this lgt day of AbV4A Wj(j1A#9f( by and among the CITY OF CATHEDRAL CITY, a public body corporate and politic (the "City "), being a municipal corporation having been established pursuant to the Constitution and laws of the State of California, and WELK PARK NORTH, a California general partnership ( "Developer "), and LAWRENCE WELK DESERT OASIS VACATION OWNERS ASSOCIATION, a California non - profit mutual benefit corporation (the "Association ") (City, Developer and the Association are hereinafter sometimes referred to individually as a "Party " ;and collectively as the "Parties "), with reference to the following facts and circumstances and is as follows: W J/ oil , f_ 131 U 3 . -r. LN'�+R r RECITALS: A. Government Code Section 65864, Al M.,, provides that the legislative body of a city may enter into a development agreement for the development of real property in order to vest certain rights in the developer and to meet certlin public t purposes of the local government. The City Cou fil for the City has previously established procedures and requilments for the approval of development agreements, and this instrument has been approved in conformance therewith. I B. The City desires to enter into this Development Agreement with the Developer and the Association in order to facilitate the development of certain real property (the "Property") owned or controlled by the Developer, which Property In more fully described in Exhibit "A" attached hereto and shown on the maps not forth on Exhibit "B" attachr,: %areto, in accordance with the City's Specific Plan 128E (the "Specific Plan "), on file with the City Clerk of the City, which Specific Plan was previously approved by ordinance adopted at a meeting of the City Council. C. This Development Agreement and its purposes are consistent with the objectives, policies, general land uses and programs specified in the City's General Plan and the specific Plan. D. Developer has previously filed with the City its application for approval of a conditional use permit for the -2- 0 f� r� I f� f_1 55 ti, zl O Property in conjunction with the development at the Property of a vacation ownership (timeshare) project (the "Project ") encompassing up to 162 vacation ownership units within the hotel facilities constructed on the Property including certain common area amenities. Pursuant to Resolution No. P89 -515, the City approved Conditional Use Permit No. 89 -171 (the "C.U.P.") by action of the City taken on November 8 , 1989. The approval of the C.U.P. was subject to a number of conditions (the "Conditions). E. Condition No. ! to the approval of the C.U.P. ( "Condition No. 1 ") requires that the Developer and the Association enter into a development agreement with the City, in the form of this Agreement, to provide for the payment by the Association of certain annual fees in lieu of payment of transient occupancy taxes, levy and collection of which taxes the City herein agrees to forego. F. The city finds that it is in the beat interests of the City to permit and to encourage the development of the Property by Developer as a vacation ownership project and desires to assist Developer in the enhancement of the value of the Property by its promotion thereof as more particularly set forth herein. The City also recognises and acknowledges that the sale of vacation ownerships (the "Vacation ownerships ") in the Project will, through the City's sharing in property tax revenues made available to the City by Riverside County, benefit the City e economically, notwithstanding the fact that at the present time -3- JFS: r P u ,o 0 I Y some or all of any such revenues (the "Property Tax Revenues ") received by the City may not be available to the City for general purposes since such Property Tax Revenues are not presently permitted to be deposited into the general fund (the "General Fund ") of the City. G. Developer has caused to be prepared a document entitled "Declaration of Covenants, conditions i Restrictions for vacation ownership (Lawrence Welk Desert oasis Resort) ", a copy of which is attached hereto as Exhibit "C" and made a part hersot (the "Declaration "). This Declaration has been drafted in a fors which the Parties believe satisfies the requirements sat forth in Condition Ho. 4 and the Parties desire, by entering into this Development Agreement, to evidence their agreement with respect thereto. H. Developer intends to develop the Project and to sell and market it as a vacation ownership project to the consuming public. Developer wil) represent to such purchasers of vacation Ownerships that the obligations of the city herein undertaken with respect to the computation of the amounts due the city as described herein are in full force and effect and inure to the benefit of such successor owners. The City recognises that Developer might be subject to substantial liability if the City were to alter its position and default in its obligations herein. I. Developer also desires to confirm herein several other development matters concerning tAe Project, to wit: a r� r' Ij rl !f r a 1 - ,y,)o _J (1) That the parking requirements of the City as regards the intended use of the Property and in effect on the date hereof are presently satisfied and will not be altered or amended by the City to the detriment of Developer in the future. The parking presently available at the Property consists of 247 spaces. The Property will be used as a vacation ownership resort F containing 162 Condominiums and associated recreational amenities as wall as a 9000 square foot office and administrative building containing an existing restaurant and bar facility (the ".office Building "). The present parking available at the Project and the Office Building satisfies current City requirements as applied to the intended and permitted uses of the Property, the Project and the office Building. (2) That transient occupancy taxes levied with respect to the Developer's rental activities will be calculated using an agreed upon method of determination hereinafter set forth, which method distinguishes between the transient occupancy taxes due for room rentals ( "Hotel Rentals ") at the Project which comprise the rental of hotel rooms at prevailing rates to overnight guests, which rentals are not made in connection with the Developer's use of the Project to accommodate the occupancy of rooms by guests invited to the Project as a part of Developer's marketing efforts under a marketing program for the sales of Vacation ownerships (the "Marketing Program "). J. The City acknowledges that by electing to enter into contractual agreements such as this one, the obligations of which t -S- r r r .r r 4 $ .. .: f Z shall survive beyond the term or terms of the present City Council members, that such action will serve to bind the City and future City Councils to the obligations thereby undertaken, and this Development Agreement shall limit the future exercise of certain governmental powers of the City. By obligating the City pursuant to this Development Agreement, the City Council has elected to exercise certain governmental powers at the time of entering into this Development Agreement rather than deferring its action to some undetermined future date. The terms and LI conditions of this Development Agreement have undergone extensive review by the City and have been found to be fair, just and ... reasonable, and the City has concluded that the economic interests of its citizens and the public health, safety and welfare will be best served by entering into this obligation. %0 K. This Development Agreement will promote and encourage the development of the Property and the Project by providing the Developer and the Association and its mombars with certainty aJ 11 t to the tax burdens affecting the Property and the rental of th e rooms at the Project and the Parties agree that the consideration to be received by the City, the Developer and the Association pursuant to this Development Agreement and the rights secured to the City, the Developer and the Association hereunder constitute sufficient consideration to support the covenants and agreements of the City, the Developer and the Association. The City's agreements not forth herein are for the betterment and benefit of the Property and promote its development and assure to the owners -6- I thereof, including the Association's members, that the City will not change its position in the future regarding the nature and amount of charges against the Property and its owners. L. Article 2.5 of Chapter 4, Division 1, Title 7 of the California Government Code consisting of Sections 65664- 65669.5 authorizes the City to enter into binding development agreements for the development of real property with persons having legal or equitable interests in such property. City, Developer and the Association acknowledge that the Code states that a development agreement shall contain, among other things, terms and conditions related to "the permitted uses of the property, the density or intensity of use, the maximum height and size of proposed buildings, and provisions for reservation or dedication of land for public purposes." The topics of the height and size of buildings, as wall as reservation or dedication of land for public purposes, are not relevant to the subject matter herein contained and therefore are not included :.-. this Agreement. Ji between themselves the :arties inta„d to be contractually bound whether or not this instrument meets those statutory requirements, and desire that the provisions of agreement nevertheless be governed by said Article 2.5; the Parties therefore waive any objections regarding the sufficiency of this Agreement with respect thereto. I -7- N t 1� i� i `P v �.0 thereof, including the Association's members, that the City will not change its position in the future regarding the nature and amount of charges against the Property and its owners. L. Article 2.5 of Chapter 4, Division 1, Title 7 of the California Government Code consisting of Sections 65664- 65669.5 authorizes the City to enter into binding development agreements for the development of real property with persons having legal or equitable interests in such property. City, Developer and the Association acknowledge that the Code states that a development agreement shall contain, among other things, terms and conditions related to "the permitted uses of the property, the density or intensity of use, the maximum height and size of proposed buildings, and provisions for reservation or dedication of land for public purposes." The topics of the height and size of buildings, as wall as reservation or dedication of land for public purposes, are not relevant to the subject matter herein contained and therefore are not included :.-. this Agreement. Ji between themselves the :arties inta„d to be contractually bound whether or not this instrument meets those statutory requirements, and desire that the provisions of agreement nevertheless be governed by said Article 2.5; the Parties therefore waive any objections regarding the sufficiency of this Agreement with respect thereto. I -7- N t 1� i� i `P v , 0 MATTERS OF AGREEMENT NOW, THEREFORE, the City, the Developer and the Association, for.'and in consideration of the foregoing, the mutual promises and'agrasments herein contained, and under the conditions hereinafter set forth, do hereby agree as follows: °.1. Definitions. As used in this Development Agreement, the following terms *hall have the following meanings: 1.1 "Association" means the Lawrence walk Desert Oasis Vacation Owners Association, a California non - profit mutual benefit corporation. 1.2 "Basic Assessment" means the "Basic Assessment" as the quoted term is defined at Paragraph 1.10 of the Declaration. 1.7 "Utz" means the City of Cathedral City, Riverside County, California. 1.4 "Declaration" means that certain Declaration of Covenants, Conditions i Restrictions for Vacation ownership (Lawrence Welk Desert oasis Resort), which Declaration will De recorded in the office of the County Recorder of Riverside County, California. 1.5 "Development Agreement" means this Development Agreement entered into by and among the City, the Developer and the Association. 1.6 "Developer" means the business entity identified as such in the introductory paragraph of this Development Agreement. -a- i 1 S : 'i I� r t' 1_ .l:.v c� QAIS .•, ri; 1.7 ' "General Fund" means the City's General Fund, with respect to which the use of the monies deposited therein is unrestricted to the City, as more particularly set forth in thak ! ordinances of the City. 1.8 "Hotel Rentals" shall have the meaning ascribed thereto in Recital I, above. 1.9 "Marketing Program" shall have the meaning ascribed thereto in Rental I. above. 1.10 "Office Building" shall have the meaning ascribed I thereto in Recital I, above. +( 1.11 " Original Deed" means an "Original Deed" as the.t quoted term is defined'in the Declaration. 1.12 "Proiect" shall have the meaning ascribed thereto i in Recital D, above. 1.17 "Property" means the real property described in Recital B, above. + 1.14 " Property Tax Revtnues" means any funs collected I by the Tax Assessor of Riverside County and in which the City is entitled to share or which are otherwise transferred to the City by the Riverside County Tax Assessor, whether received by the City or by any agency or subdivision of the City, including, but not limited to, the Redevelopment Agency of the City, which funds comprise a portion of real property taxes collected in connection with the vacation Ownerships. -9- A: 1.15 "Starting Date" means the date on which the first original Dead is recorded in the office of the county Recorder of Riverside County, California. 1.16 "Transient occupancy Tax" means the percentage tax charged by the City at any time and from time to time with respect to revenues generated by the rental of visitor-serving, non-residential dwelling units located within the City. 1.17 "Transient occupancy Tax Equivalent" means an amount determined by multiplying (a) the Basic Assessment paid by an owner of a Vacation Ownership to and received by the Association by (b) the Transient Occupancy Tax. f G 1.16 "MU," means a "Unit" within a "Vacation Ownership Interest Condominium" located within the Property (as the quoted terms are defined in the Declaration). 1.19 "Vacation ownership" means a "Vacation Ownership" as the quoted term is defined in the Declaration. Z. Condition No. 4 Compliance. Based upon a ther,-#Agh review at the Declaration by the city and the City Attorney for the City and the City Council, the City acknowledges and agrees that the provisions of the Declaration which addressed the concerns expressed in Condition No. 4 have been adequately and completely addressed by the Declaration and the Declaration is in compliance with Condition No. 4. 3. Payments In Lieu of Taxes. The City agrees, during the torn of the Declaration, that it shall not impose any special to*, tax, exaction or assessment, except for the Transient -10- occupancy Tax Equivalent provided for herein, with respect to th occupancy of the Project or the Property by "Owners ", "Permitted Users" or "Exchange Users" (as the quoted terms are defined in the Declaration), which fee, tax, exaction or assessment is in the nature of a transient occupancy tax, or is a fee, tax, exaction or assessment not levied on all similar businesses, owners or properties within the City. a. Collection of Tex Eauivalent. On a monthly basis, the Transient Occupancy Tax Equivalent shall be paid for the immediately preceding month by the Association, not later than the 20th day of the month succeeding the month for which such payment is made, which payment shall be based upon the Basic i Assessments actually received by the Association. As more particularly provided in Paragraphs 1.11 and 5.1 of the Declaration, the Transient Occupancy Tax Equivalent will be assessed to each owner of a Vacation ownership in the Project as a ports ,)n of the Basic Assessment. The Association ag:ses to provide the City with a statement reflecting how the Transient Occupancy Tax Equivalent was calculated, which statement shall accompanied by such supporting data as is reasonably necessary make the statement clear and understandable, including, but not limited to, records of the Association reflecting the Association's receipt of an Owner's payment of his Basic Assessment. Nothing in this Paragraph 4 or this Agreement shall affect, modify or otherwise limit Developer's obligation to pay the -11- r 1 C 0 Transient Occupancy Tax on rental income received by Developer in connection with Hotel Rentals or the Marketing Program as not forth in Paragraph 110 below, or the Association's obligation to pay the Transient Occupancy Tax on rental income received by the Association as the result of its rental, if any, of Units to the general public. 5. Term of Agreement, Amendments. This Development Agreement shall be and remain in effect for a term which is coextensive with the term of the Declaration, commencinq upon the later to occur of (a) the effective date of the ordinance of the City adopting this Development Agreement, or (b) the acquisition of title to the Property by Developer as more particularly set forth in Paragraph 9, below. This Development Agreement may be amended only by written agreement of the Parties hereto and in accordance with the notice provisions of Government Code Section 65868. 6. Notice. All and any notices, statements, demands, correspondence and other communications to be given under or pursuant to this Development Agreement shall be in writing and shall be deemed to be given on the date that any such notice, statement, demand, correspondence or communication is delivered in person to the other Parties or deposited in the United States mail, first -class mail, postage prepaid and addressed to the Parties as follows: To the City: City of Cathedral City P.O. Box 5001 Cathedral City, CA 92235 -5001 Attention: City Manager 0 City Attorney -12- i : i i I i t I r rn- r; .o .' • :_ Pi 1. To the Developer: Welk Park North 10875 Rancho Bernardo Road, 2nd F1. San Diego, California 92127 Attention: Mr. David R. Clifton With a copy to: Cox, Castle i Nicholson 19800 MacArthur Boulevard Suite 600 Irvine, California 92715 . Attention: Arthur O. Spaulding, Jr. To the Association: Lawrence Welk Desert oasis vacation owners Association 34567 Cathedral Canyon Drive Cathe ra City, California 92234 7. Offset of Property Tax Revenues. The City agrees that, in the event that changes in applicable law authorize the deposit of all or a portion of the Property Tax Revenues in the General Fund, from and after the date upon which such change in the law shall take effect, the Association shall be entitled to offset against the amount of the Transient occupancy Tax Equivalent due for any tax year, the amount (the "offset ") of Property Tax Revenues which are authorized to be deposited in the General Fund and which are attributable to such tax year. The Offset shall be applied only to the amount of any Property Tax Revenues which are in excess of the amount (the "Existing Amount") of Property Tax Revenues payable to the city's General Fund during the year immediately preceding the execution of this Agreement, as the Existing Amount may be augmented from time to time by reason.of the operation of the acceleration provisions of Proposition 13 (Article 13(a) of the California Constitution, providing for an increase at the rate of 2% per year). The intent of the Parties , -13- c is that City shall continue to receive the Existing Amount, as increased under Proposition 17, in order to realize all tax proceeds for its General Fund that it presently receives (plus the annual 2% increase therein), but that any additional revenues which may be realized for the City's General Fund as a result of the Project shall be subject to credit against Transient Occupancy Tax Equivalent. Since it is impossible, as of the date of execution of this Agreement, to anticipate the timing of receipt of Property Tax Revenues and the procedure by which such an offset would be accomplished, should the circumstances &rise under which the Association is entitled to an offset hereunder, the City and the Association shall determine the manner and the timing in which such an offset shall be affected, including the nature of the notice to be given by the City to the Association, the date or dates upon which such notice shall be given and the frequency thereof, and whether the offsc` ^.hall be a credit against the monthly obligations of the Association hereunder or shall be determined on a cumulative annual basis in arrears for each tax year. The parties agree to cooperate with each other in good faith in the formulation of the methods and procedures to be adopted under this Paragraph 7. e. Promotional Efforts. In consideration of the agreements, covenants and undertakings of the Developer and the Association hereunder, the City agrees to promote the Project in any materials published by the city for the purpose of promoting tourism in the city, generally, at least to the extent oe the -1�- { I } rJ r- r_l r a' P .o .. o M1 promotion provided to any other similar business entity. Developer acknowledges that City cannot give preferred treatment to any of its resident businesses, but agrees to feature i Developer's enterprise at least as prominently as it features any similar business enterprise within the City. similarly, Developer and Association agree to promote the name and identity of the City in their promotional brochures publicizing the Project, and to use a Cathedral City, California mailing and business address for materials relating to the Project (other than Developers general business publications, mailings and other i communications). Additionally, the City agrees to hold a public hearing in accordance with Its standard practices on proposed street name changes, and, if feasible after public hearing, but without obligating the City Council or the City's Planning Commission, shall give full, fair and favorable consideration to changing the name of "Cathedral Canyon nrive" between Highway 111 (East Palm Canyon Drive) and Raman Road to "Lawrence Walk Drive ". Should public input on such a proposal render such name change infeasible, the City agrees to consider a proposal to change the name of "Pasco Real", or some other street recommended by Developer and Association, to "Lawrence Welk Drive ", and to effect such a name change after public hearing, if no significant opposition thereto occurs at the public hearing. The City reserves the right of the Planning Commission and of the City Council to exercise full discretion in regard to any proposed street name change, and a fair hearing on the issue shall be -ls- � 1 {I City's sole obligation as to such proposed name change. The City agrees that it'will not publish promotional materials using the Lawrence Volk name without Developer's prior written approval, which approval may be given or withheld in Developer's sole discretion. 9. Condition Precedent. The Parties hereto acknowledge that Developer is not presently the owner of the Property but, rather, is a party, as a buyer, to an agreement (the "Sale Agreement") to purchase the Property from its present owner, Falcon Lake Properties. The rights, duties and obligations of the Parties hereto are contingent upon the closing of the sale contemplated by the Sale Agreement and the transfer of title to the Property to Developer. The term hereof shall commence on the date upon which Developer shall acquire a sublaasshold interest in the Property, together with the improvements thereon by instrument recorded in the office of the Rivef.. ;4s County Recorder, California. 10, Parking. The City agrees that the parking presently available at the Property satisfies and shall be deemed to satisfy all present and future parking requirements for the Project and the Office Building, as the Project and the Office Building are intended or permitted to be used in accordance with the applicable toning ordinances of the City. 11. Transient Occuoanev lazes for Rotal Rentals and Marketing Program Occumanc�Program The parties acknowledge the need to clarify the obligations of Ddvalopor to pay Transient occupancy -26- 1_ '1 a r L' b w r�r Taxes with respect to rental revenues generated either from the Hotel Rentals or deemed to be generated pursuant to the operation of the Marketing Program. Accordingly, City and Developer agree that revenues received by Developer for Hotel Rentals shall be taxed at the regular Transient occupancy Tax rate and shall be paid by Developer to the City in accordance with the City's Transient occupancy Tax ordinance, based upon the prevailing nightly room rate charged to such occupant. Developer further agrees that for each night of occupancy of a Unit by quests invited to the Project as part of the Marketing Program, Developer will pay to the City an amount determined by multiplying the sum of $75.00 by the Transient occupancy Tax, which amount will be paid by Developer to the City as any other Transient Occupancy Tax is paid by hotel or motel operators within the City. 12. Rules of Conatructio- Miscellaneous. 12.1 do Personal obliaation. Except as provided in Paragraphs 8 and 11, above, this Development Agreement in and of itself does not represent a personal obligation of the Developer, its successors or assigns, and nothing herein contained shall in and of itself be deemed to create an obligation of Developer to pay the Transient occupancy Tax Equivalent (except in its capacity as a member of the Association under the terms of the Declaration) or to complete the Project as contemplated, or to complete any particular portion thereof by any particular time. The City's sole recourse for the failure to receive payment of -17- the Transient Occupancy Tax Equivalent shall be to the Association as agent for the owners of Vacation Ownerships in the Project. 12.2 Covenants Run With Land. This Development Agreement shall be deemed to contain covenants and conditions running with the land, to benefit and burden the Property, binding upon those parsons who now or hereafter own interest& in Ithe Property. 12.3 Definitions of City's successor&. For the purposes of this Development Agreement, the tarn "City" shall include any public agency, assessment district or tax district, or agency or commission created by or with the consent of the 1 �fCity, and the city's successors and assigns shall include the 101foregoing and all county agencies and private entities enforcing the City's Code, and in the event of any disincorporation, the county of Riverside. a2.4 Recitals. The recitals contained in this Development Agreement are incorporated herein by reference. Each t recital of fact concerning the city, the Developer or the f Association shall be conclusive as between the Parties hereto. Such facts shall be incontestable in the event of any dispute "- between the City and Developer regarding such fact and each Party 'agrees not to introduce any evidence in a court or administrative proceeding which would in any way serve to dispute such recited fact. -Is- 0 0 12.5 Attorneys' Fees. If legal action be commenced to enforce or declare the effect of any of the provisions of this Agreement, the court as part of its judgment, shall award reasonable attorneys' fees and costs to the prevailing party. 12.6 Duplicate Originals. Two or more duplicate originals of this Development Agreement may be signed by the Parties, each of which shall be an original and all of which together shall constitute one and the same instrument. 12.7 Advice of Legal Counsel. Each Party and its counsel have cooperated in the drafting and preparation of this Development Agreement. This Development Agreement shall be doomed the Parties' joint work product and may not be construed against any Party by reason of it. preparation. 12.9 No waiver. The waiver or failure to enforce any provision of this Development Agreement shall not operate as a waiver of any future breach of such provision or of ;ny other provision hereof. 12.9 Construction. As used in this Development Agreement, the masculine, feminine or neuter gender and the singular or plural numbers shall each be deemed to include the other whenever the context so indicates. This Development Agreement shall be construed as a whole and in accordance with its fair meaning, the captions being for convenience only and not intended to fully describe or define the provisions in the portions of this Development Agreement to which they pertain. f -19- i f s r t c ',_.,.::� 12.10 Mortgagee Protection. The parties agree that ' this Agreement shall not bind any lender providing construction or permanent financing for any improvements in the Project. No provision hereof shall defeat; render invalid, or limit any , mortgage, dead of trust, or similar security interest applicable to the Project, and in the event such impairment is asserted by a lender the parties agree to negotiate in good faith to modify the.' provisions of this Agreement which have led to such assertion. { 12.11 Retention o[welk Name and Identification. The Parties recognize that the name identification of Lawrence Welk in connection with the Project is of major importance to the City in its consideration of this Development Agreement. Developer agrees that, in the event Developer determines to withdraw the use of the Lawrence Walk name as provided in the Declaration, 3; Welk will notify he City of its intentions not lose than ninety Y Y y (90) days in advance of the date upon wnlun any such withdraw-.l r' would be effected end, further, shall most with the City within ten'(10) days following the date of such notice to inform the City of the reasons for such action and to permit the City to confer with Developer in regard thereto. 12.12 Books and Records. To the extent reasonably ±N necessary to enable the City to determine whether it receives all funds properly due under this Development Agreement, the City shall have access at all reasonable times, upon at least 24 hours advance notice, and at a place within the city limits of the City, unless otherwise agreed among the Parties, to review all �I _20_ �I r { i t t; .books and records of Developer and Association relating to the i ?44' amounts properly due and payable. All information provided to }} the City shall, to the extent permitted by state law, be regarded ? as confidential and shall not be voluntarily disclosed to persons for entities not a party to this Agreement. If the City is required under state law to make disclosure of any such information upon request for information under then existing state law, City shall notify Developer and Association of such 'determination, and of the right of the Developer and Association to seek a court determination that the books and records are not subject to disclosure and of the anticipated date on which such release is expected to be made. Developer and Association may then, at their sole option, seek a court determination as to whether such records are subject to disclosure. 11.13 Assionment. Developer shall have the right to assign its rights and obligations under th!- nevelopment Agreement, by giving ;rior written notice to the City and the Association, to any entity in which either or both general _. partners of Developer retain a majority interest so long as such assignee expressly assumes the obligations of Developer hereunder. otherwise, no party hereto may assign all or any portion of its rights hereunder nor delegate all or any portion of its duties and obligations hereunder without the prior written k, consent of the other Parties hereto, which consents shall not be unreasonably withheld. -21- i t �r rn • z;l o �i l LY JI. '• M �• �S71w. in I.,LJ !.i I� ! I -!k f 11 .f �f �r rn • z;l o �i l 0 >^' IN WITNESS WHEREOF, the City, the Developer and the Association have executed this Development Agreement as of the date first -above written. "CITY" THE CITY OF CATHEDRAL CITY, CALIFORNIA IgBy: Mayor of the C ty of edral C ty, California (SEAL) Attest: C t Clark the City of CatHedral C%LW, California [signatures contir'•M on next page] U ip Y. - 22 - �i i i' a° 1 n. If i� r. MIA 1 �l r� ,. p, OFIATE ACKNOWLEDGMENT >( Stateof Callfornla r County of _ gfv.rnid Development Agreement with Welk Group dated June 18, 1990 OFFICIAL SEAL KAMMy D Hllt R0TAC nrft-C • CALIrOaNIA awTlnlDr Pobklr w! nvm ,q4n OCt If• I9W nal In CORPORATE ACKNOWLEOGMENT Stalsol California Sf. Cauntyo7 RIV e Lp ids Development Agreement with Welk Group dated June 18, 1990 25-�y: • ` I' eo rm OnthhthelOth dayol July 1940 before me, Kammy D. Ifill the undersigned Notary Public, pus0natfy appeared Robert A. Hillery MC Personally known to me r Proved tome on the basis of satisfactory evidence to be the P&SCM111l who executed the within Instrument as Mayor oronbehallofth*CGMCraltonthepin name nd acknowledged 10 me ltrt the corporation executed It. MINES my hand and ore wnplYL Ymtv&"ow,R,r'30,11 vw+ sw.r0 a. Wa. MerOene �r+.a anwa» 4o rm On this the LOthday of July 1990 before me, Terri S. Allen the undersigned Notary PUWIC, personally appeaed Kaary D. Mill R personally known to" I: proved tome on the basis 01 satisfactory evl"^Ce to be the Portents) who eseculed 1ha within Instrument u ___C_1Sy_.Clerk or on behalf of the corporation therein named, and acknowledged 10 me that iha corporation aseouted It. WITNESS hand and olllolal N.I. s slgnetui f `r I- `„ S rid y Esignatures continued from previous page) "DEVELOPER" WELK PARK NORTH, a California general partnership By: Kemper Development, Inc., a California corporation, General Partner By: La4 Dav R. ClLzton, President "ASSOCIATION" LAWRENCE WELK DESERT OASIS VACATION OWNERS ASSOCIATION, a California non - profit mutual benef7trporat lon By -�e czq t{ V1 w Vr"e ldw"f —23— L. ) STATE OF CALIFORNIA ) ) ss. COUNTY OF SAN DIEGO ) On ��J)_, 19 , before me the undersigned, a Notary Pu lb id in an-0 for yaid County and State, personally appeared DUQ;C{ Y.. C)rf-?On know to me to be the , of REMPER DEVELOPMENT, INC., the corporation that executed the within instrument, and known to me to be the persons who executed the within instrument on behalf of said corporation, said corporation also being known to me to be one of the venturers of WELK PARK NORTH, the joint venture that executed the within instrument, and acknowledged to me that such cor- poration executed the same for and on behalf of itself and as a venturer of such joint venture and that such joint venture executed the same. WITNESS my hand and official seal. UAL 54NOA iNNfiY aomArnwls•orsw. o ary Pu c n A tor said MN011130001+"" County and stave *C. LMK ti 71, IM STATE 01 CAIII ' COUNTY Q1 � pryl/r .n •i55..�� r-..-- C.rLe.Mh .ro.n 10 M Ib pp.« 10 M M pM OIIr, M,,,rLIK1.l� Iwspp, M 100 NOTARY L[AL OIL STAMP S.(r.l.r, OI IM <b.M1.lrpn In.1 ..KrrIN IM.rMr111Mpy...n1, Lnepw Nl M M MIM Mr \M..nO..KVI «Ir...nw In \IrMyM MMpMM11Y tPy0r.lgrl MCI Em um WpM11NMLISnl5 l rTy.n_.,. M .n OOrr.rM .rl .w,M �I Mt�o � IM.�. ., .LN , 1.`� \K�.. r «OM� MOIMbMOMONtq/1 WI a�SHFMY LOtw PikA� \C OF Cr bob"�n j fOIIY aA N✓M q,MJ p L.M. I C � 1_ 1- I- 'i 1_ L'/i F i EXHIBIT A Lots 1, A, 8, C, 0 and E of Tract Number 18708, in the City of Cathedral City, County of 'Riverside, State of California as per map recorded in Book 130, Pages 67 and 66, in the Office of the County Recorder of said County. I ; I.- i " fi:i EXHIBIT B '. . t7 i Ilif �I fib • a, f _ "-• r n.: •':ir% ia• .rw �i.� ��"". ^rte ~•"-S roioct Units ^�•�..'•� - ti.; "•^ ::. D11 /Sjtl�••Vw� d P"/eklep "i•�•� ..." "[ae�"I � Sio t 4, \4%'N e X awlapl/nt AgrNe/ne 69 -7 % i INlk fort Gmv N0RTN ` I �l. A 11 I ` 1 • 1 I • ti14 I I� Crlya+ �j da4lnl 1 F— )n Lng of it Council Meeting 2-10 -97 • Agenda No. 14 CITY OF NEWPORT BEACH OFFICE OF THE CITY ATTORNEY February 5, 1997 Fig I 0 097 TO: MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: ROBERT H. BURNHAM, CITY ATTORNEY RE: Authorization for City Manager to Execute Acknowledgment of Easement Agreement between The Irvine Company and ZG Properties regarding a portion of John Wayne Gulch • The Irvine Company is the owner of property commonly known as John Wayne Gulch, which is just northerly of the Newporter Resort. For many years, a small portion of John Wayne Gulch (approximately three - quarters of an acre Easement Area) has been used by the hotel as an executive golf course. ZG Properties is in the process of acquiring a portion of the hotel site to construct a timeshare resort, and contemplates the reconstruction of the existing golf course into a "putting course." The putting course would be open to members of the public, as well as guests of the resort/hotel. The proposed agreement between TIC and ZG Properties would do nothing more than legitimize the existing use of the Easement Area (copy of proposed Easement Agreement is attached). • The Irvine Company is required, pursuant to CIOSA, to dedicate John Wayne Gulch to the City of Newport Beach for open space purposes. The precise boundaries of the parcel to be dedicated were not known to the City of Newport Beach, or The Irvine Company when CIOSA was approved. However, the City did not expect to acquire, pursuant to CIOSA, any area utilized as a portion of the hotel's golf course. The proposed Agreement between The Irvine Company and ZG Properties would restrict use of the Easement Area in a manner consistent with the provisions of CIOSA. The proposed Agreement also requires City Approval prior to installation of any landscaping or improvements. Finally, the Easement Agreement only allows improvements which are consistent with those typically installed in golf or putting course. 1 0 6 The Irvine Company and ZG Properties have submitted the Easement Agreement • to the City for review and approval since we will be in the position of The Irvine Company once John Wayne Gulch is dedicated pursuant to CIOSA. We believe the proposed Agreement is fully consistent with CIOSA, and protects the interest of the City now, and in the future. Accordingly, we recommend that the City Council authorize the City Manager to execute the Acknowledgment and Agreement provided the final agreement between The Irvine Company and ZG Properties is substantially the same as the draft attached to this memo. • u M Op� • Staff recommends City Council authorize the City Manager to execute the Agreement and Acknowledgment to the Easement Agreement and Grant of Easements between the Irvine Company and ZG PropertieF/ L.L.C. RHB:kh fAcat \cds \ccmemo\zu Ich.doc F2OBERT H. BURNHAM City Attorney 6 • J EASEMENT AGREEMENT AND GRANT OF EASEMENTS This EASEMENT AGREEMENT AND GRANT OF EASEMENTS (the "Easement Agreement ") is entered into as of February 3 , 1997, by and between The Irvine Company, a Michigan Corporation ( "Grantor "), and ZG PROPERTIES, L.L.C., a California limited liability company ( "Grantee "), whose members are Joseph J. Zilber and J. Stephen Goodfellow, individuals. RECITALS A. Grantor is the sole owner of that certain real property (the "Easement Area ") situated in the County of Orange, State of California, more particularly described on Exhibit "I ", attached hereto and incorporated herein. The Easement Area is part of a larger parcel of real property (the "John Wayne Gulch ") which is proposed to be dedicated by Grantor to the City of Newport Beach (the "City ") for open space purposes under terms of a Circulation improvement and Open Space Agreement between Grantor and the City. The Easement Area contains approximately 34,014 square feet. For purposes of this Agreement, the party which owns John Wayne Gulch is hereinafter referred to as the "Owner ". B. The Easement Area is immediately adjacent to a parcel of real property (the "Development Parcel ") containing approximately 5.4 acres and situated in the County of Orange, State of California, more particularly described on Exhibit "2 ", attached hereto and incorporated herein. Grantee is acquiring the Development Parcel for purposes of constructing a timeshare resort thereon. The Development Parcel is currently a portion of a larger parcel of real property (the "Hotel Parcel ") on which that certain resort hotel commonly known as the "Newporter" is located. The Hotel Parcel is owned in fee by HAC Real Estate Corp. B ( "HAC") and is subject to a ground lease (the "Ground Lease ") in favor of Patriot American Hospitality, Inc. ( "Patriot "). The obligations of Patriot under the Ground Lease have been assumed by NorthCoast Hotels L.L.C. ( "NorthCoast ") C. The Hotel Parcel contains an executive golf course and a portion thereof encroaches into John Wayne Gulch. The encroachment is described by the boundaries of the Easement Parcel. In addition, Grantor is the owner of a fifteen foot wide general easement (the "Perimeter Easement "), recorded June 30, 1992 as Instrument No. 92- 441109 in the official Records of orange county, California. The Perimeter Easement completely surrounds the Hotel Parcel and extends into the Hotel Parcel the distance of fifteen (15) feet from the exterior boundaries of the Hotel Parcel. The Perimeter Easement also affects and encumbers a parcel of property (the "Tennis Club Parcel ") lying adjacent to and immediately to the east of the Development Parcel. The portion of the Perimeter Easement lying along the northerly lines of the Development Parcel and Tennis Club Parcel is hereinafter referred to as the "Development Perimeter Easement" and the property subject to the Development Perimeter Easement is hereinafter referred to as the "Perimeter Easement Parcel" and is more particularly described in Exhibit "3" attached hereto and made a part hereof. D. Grantor desires to grant to Grantee, and Grantee desires to accept the grant of, an easement on, over, across and under the Easement Area for the purposes described and as more particularly set forth below. In order to permit the efficient development of the LWOCI \73568.1 0129197 11:50= 0 • timeshare project on the Development Parcel, Grantor is also willing to quitclaim the Development Perimeter Easement to Grantee as more particularly set forth below. NOW, THEREFORE, in consideration of the above and the mutual covenants, terms, conditions and restrictions contained in this Easement Agreement, Grantor and Grantee agree as follows. MATTERS OF AGREEMENT 1. Grant of Easements. Subject to the City of Newport Beach approving the terms of this Easement Agreement and agreeing to accept dedication of John Wayne Gulch subject to the following easements, as evidenced by execution of the Acknowledgement and Agreement attached to this Easement Agreement, and further subject to the condition precedent set forth in Section 6 below, Grantor conveys to Grantee, and Grantee accepts, the easements described in Section 2, below, in, over and on the Easement Area in perpetuity and subject to the terms of this Easement Agreement (the "Easements "), which Easements shall be appurtenant to and shall be for the benefit of the Development Parcel and the Hotel Parcel, respectively, as provided in Section 6. Following execution of this Easement Agreement by Grantor and Grantee, and of the Acknowledgement and Agreement by the City of Newport Beach, this Easement Agreement shall be recorded in the Official Records of Orange County, California. 2. Purpose of Easements. The Easements granted hereunder include the following appurtenant rights, which shall be used by Grantee and its successors -in- interest only for the following purposes: (a) Landscape Easement. Grantor grants to Grantee a landscape easement (the "Landscape Easement ") for the construction, repair, maintenance, replacement, provision of utility service to and use of landscaping, waterscaping, and hardscaping (hereinafter collectively referred to as "Landscaping ") in connection with, and together with the right of Grantee and Grantee's guests and permitees to engage in, the recreational use of the Easement Area as a golf course, putting course or other recreational open space improvements installed in association with hotel and timesharing activities conducted or to be conducted upon the Development Parcel and /or the Hotel Parcel. From and after the Recordation Date, Grantee may install small monuments within the Easement Area, including but not limited to fountains, reflection pools, circulating water features, decks, benches, walk -ways, irrigation systems, and unobtrusive lighting (collectively, the "Permitted Improvements ") . (b) Access and Utility Easement. Grantor grants to Grantee an access and utility easement (the "Access Easement ") for access to the Development Parcel for construction of improvements thereon and for the maintenance, repair, replacement and operation of the improvements constructed within the Development Parcel, and for utility purposes. 3. Restrictions Upon Easement Use. Notwithstanding anything to the contrary in Paragraph 2, the following restrictions or conditions shall apply to the use and enjoyment of the Easement Area: LWOC1173 %8.1 -2- 01/29197 11:50ar 0 0 (a) None of the Permitted improvements may exceed six (6) feet in height and each Permitted improvement must be installed in conjunction with Landscaping which is similar in nature to other typical golf course, putting course and /or other landscape installations used within the Development Parcel or the Hotel Parcel. (b) No Landscaping or Permitted improvements may be installed within the Easement Area which extend beyond the Easement Area into other portions of John Wayne Gulch and in no event may any use be made of or installations of Landscaping or Permitted Improvements be made upon the Easement Area which would destabilize the slopes of John Wayne Gulch adjacent to the Easement Area. No utilities may be constructed within the Easement Area unless the main lines for such utilities are located completely underground. (c) No Landscaping or Permitted improvements may be installed within the Easement Area without the prior approval of the City, as more particularly set forth below. For purposes of this paragraph, Grantee shall request approval by submitting its proposed plans for Landscaping and the Permitted Improvements to the City. If no objection is received by Grantee regarding the submitted plans within tan (10) days after the date on which the plans are received by the City, the proposed plans shall be deemed approved and are hereinafter referred to as the "Approved Plans ". Landscaping and Permitted Improvements actually installed within the Easement Area shall not vary materially from the Approved Plans without the prior approval of the City. (d) No Landscaping or Permitted Improvements of any kind may be made or maintained within the Easement Area unless they are to be used in conjunction with uses permitted by the City within the Development Parcel or the Hotel Parcel. 4. Maintenance of Easement Area. From and after the recordation of this Easement Agreement, and subject to the condition precedent set forth in Section 6 below, Grantee shall bear all responsibility, costs and liabilities of any kind concerning the operation and maintenance of the Easement Area, including maintaining commercial general liability insurance coverage from a company acceptable to the Owner in a principal amount of at least $1,000,000.00, and an endorsement to Grantee's policy naming the Owner as an additional insured; provided, however, that if the Landscape Easement is assigned as provided in Section 6, below, and the Access Easement is retained by Grantee or assigned by Grantee as set forth in Section 6, below, the obligations of this section shall be delegated to and be the responsibility of the holder of the Landscape Easement. 5. Quitclaim of Development Perimeter Easement. Subject to the condition precedent set forth in Section 6 below, Grantor quitclaims to Grantee the Development Perimeter Easement. Grantor agrees to deliver to Grantee a recordable quitclaim deed (the "Quitclaim Deed ") in form and substance reasonably acceptable to Grantee, within five (5) business days after receipt by Grantor of a written request therefor from Grantee, containing an accurate and surveyed legal description thereof, which request shall only be made following satisfaction of the condition precedent set forth in Section 6 below. 6. Assignment of Grantee's Interest. Grantor and Grantee acknowledge and agree that the Easements are intended to be appurtenant to the Developer Parcel and the Hotel Parcel as well. Accordingly, Grantee's acquisition of the Development Parcel, or assignment of its rights under this Easement Agreement as provided in the remainder of this LWOCI \73568.1 -3- 01129/97 11:50= 0 0 Section 6, is a condition precedent to the grant of the Easements, and the quitclaim of the Development Perimeter Easement, and this Easement Agreement. Grantee may assign its interests under this Easement Agreement to such other entity as may be the owner or ground lessee of the Hotel Parcel and /or the Development Parcel (or an association of such owners); provided, however, that any such assignee(s) shall expressly assume all of the obligations of Grantee applicable hereunder to the interests so assigned. Any assignment without such assumption shall be void and of no effect. 7. Successors. The covenants, terms, conditions and restrictions of this Easement Agreement shall be binding on, and inure to the benefit of, the parties hereto and their respective heirs, administrators, executors, personal representatives, successors and permitted assigns and shall constitute a servitude running in perpetuity with the Easement Area. To the extent that any of a party's rights are transferred and obligations or duties hereunder are delegated and assumed, then, upon the effective date of such transfer and delegation, such rights, obligations and duties of the transferring or delegating party hereto shall terminate, except that any liability of a parry hereto for acts or omissions occurring before such transfer and delegation shall survive. 8. Indemnity. From and after the Recordation Date, Grantee shall defend, indemnify and hold the Grantor, and its partners, directors, officers, employees, agents, affiliates, and contractors and the heirs, successors and assigns of each of them (collectively, the "Indemnified Parties ") harmless from and against any and all liabilities, penalties, costs, losses, damages, expenses, causes of action, claims, demands or judgments, including without limitation reasonable attorneys' fees arising from or in any way connected with injury to or the death of any person, or physical damage to the Easement Area, except (a) such as arise out of or relate to the acts or omissions of the Indemnified Parties and (b) such as arise by reason of facts and circumstances occurring before the Recordation Date. The insurance required by Section 4, above, shall not replace this obligation. 9. General Provisions. (a) Attorneys' Fees. If any lawsuit, reference or arbitration is commenced which arises out of, or which relates to, this Easement Agreement, the prevailing party shall be entitled to recover from each other party such sums as the court, referee or arbitrator may adjudge to be reasonable attorneys' fees in the action, reference or arbitration, in addition to costs and expenses otherwise allowed by law. In addition to the foregoing, the prevailing party shall be entitled to its reasonable attorneys' fees and all fees, costs and expenses incurred in any post - judgment proceedings to collect or enforce the judgment. This provision is separate and several and shall survive the merger of this Easement Agreement into any judgment an this Easement Agreement. (b) Counterparts. This Easement Agreement may be executed in counterparts, but all counterparts shall constitute one and the same document. (c) Business Days. As used herein, the term "business day" means a day upon which the City is open for business. If the last day for performance of an act falls upon a day during which the City is not open for business such last day will be the next following day upon which the City is open for business. LWOCl \73568.1 -4- 0112919711:50a (d) Notices. Any tender, delivery, notice, demand or other communication ( "Notice ") required or permitted under this Agreement shall be in writing, and shall be personally delivered or sent by registered or certified mail, postage prepaid, return receipt requested, overnight mailed, delivered or sent by telecopier or telefacsimilie machine capable of confirming transmission and receipt, and shall be deemed delivered, given and received upon the earlier of (i) if personally served, the date of delivery to the person to receive such notice; (ii) if given by telecopier or telefacsimilie, the date on which the transmission of the telecopier or telefacsimilie is sent; (iii) if mailed, the date which is four (4) business days after the date of posting by the United States Postal Service; or (iv) if sent by Federal Express or other Comparable overnight delivery service, the date upon which delivery is effected as documented by the service's delivery records, all in accordance with the following: If to Grantee: The Irvine Company 550 Newport Center Drive P.O. Box 6370 Newport Beach, California 92658 -6370 Attn: Norman E. Witt, Jr. FAX: (714) 720 -2111 With a Copy to: Robert K. Break, Esq. Latham & Watkins 650 Town Center Drive 20th Floor Costa Mesa, California 92626 FAX: (714) 755 -8290 If to Grantee: ZG Properties, L. L. C. c/o Towne Realty, Inc. 710 N. Plankinton Avenue Milwaukee, Wisconsin 53203 Attn: James B. Young, Esq. FAX: (414) 274 -2710 With a Copy to: Pacific Rim, Incorporated P.O. Box 598 Wenatchee, Washington 98807 Attn: Mr. John Zapatocky Fax: (509) 662 -2621 With a Copy to: Arthur O. Spaulding, Jr. Cox, Castle & Nicholson, LLP 19800 MacArthur Blvd., Suite 600 Irvine, California 92715 FAX: (714) 476 -0256 If to the City: The City of Newport Beach 3300 Newport Boulevard Newport Beach, California 92658 -8915 LWOC1 \73568.1 -5- 01129/97 11:50= 0 • Attn: Robert H. Burnham, Esq. FAX: (714) 644 -3139 Any party may change the address specified in this section by giving the other parry notice of such new address in the manner set forth herein. (e) Entire Agreement. This Agreement and the documents and agreement contemplated herein constitute the entire agreement between Grantor and Grantee, and to the limited extent set forth below, the City, with respect to the subject matter hereof, and all prior or contemporaneous oral or written agreements, understandings, statements, representations or warranties between the parties other than those set forth herein or herein provided for, are hereby superseded and merged herein. (f) Modifications. No modification or waiver of any provision of this Agreement shall be binding upon the parry against whom it is sought to be enforced, unless specifically set forth in a writing signed by an authorized representative of that party. A waiver by any party of any of the terms or conditions of this Agreement in any one instance shall not be deemed or construed to be a waiver of such terms or conditions for the future, or of any subsequent breach thereof. The failure by any party at any time to enforce any of the provisions of this Agreement, or to require at any time performance of any of the provisions hereof, shall in no way be construed to be a waiver of such provisions or to effect either the validity of this Agreement or the right of any party to thereafter enforce each and every provision of this Agreement. (g) Section and Other Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. (h) Invalidi1y. If any material covenant, condition or provision herein contained is held to be invalid, void or unenforceable, the remaining provisions and portions shall nevertheless be carried into effect. (i) Governing Law. This Agreement will be construed and enforced in accordance with and governed by the laws of the State of California. (.I) Time of Essence. Time is of the essence for the performance of each and every obligation hereunder. (k) Approvals. Any approval or consent required to be obtained by a parry hereunder shall not be unreasonably delayed, withheld or conditioned by the party requested to provide such approval. (1) Construction. Each party to the transaction evidenced by this Agreement has had an opportunity to participate and has participated in its negotiation and drafting. Accordingly, in construing the terms of this Agreement, all parties shall be deemed to have participated equally and no presumptions shall be made to construe its terms in favor of or against any of the signatories hereto. LWOC1 \73568.1 '6' D1129197 11:SD= 0 0 (m) Dispute Resolution. Except as otherwise expressly provided in this Agreement, any controversy arising out of this Agreement shall be heard by a reference pursuant to the provisions of the California Code of Civil Procedure §638, et seq. The parties shall agree upon a single referee who shall be a person experienced in the resolution of sophisticated real estate and real estate financial matters and who shall then try all issues, whether of fact or law, and report a finding and judgment thereon. If the parties are unable to agree upon a referee, either party may seek to have one appointed, pursuant to California Code of Civil Procedure §640. The cost of such proceeding shall initially be borne equally by the parties. However, the prevailing party in such proceeding shall be entitled, in addition to all other costs, to recover its contribution for the cost of the reference as an item of damage and/or recoverable costs. IN WITNESS WHEREOF, the Parties have executed this Easement Agreement on the day and year above written. "GRANTOR" The Irvine Company, a Michigan Corporation, ,f By: e °2Z 'G '� ✓' Bernard -A. an calco President, Coastal Community Builders, a division of Irvin Community Development Company Authorized Signatory Daniel C. Hedigan Assistant Secretary "GRANTEE" ZG Properties, L.L.C. a California limited liability company LWOC1173569.1 -7- 0129197 WSOam • • ACKNOWLEDGEMENT AND AGREEMENT THE UNDERSIGNED, &Il lrl - o(phU having been duly authorized by all necessary and proper action taken by the ty of Newport Beach, hereby acknowledges that the terms of the foregoing Easement Agreement have been approved by the City of Newport Beach and the city of Newport Beach agrees to accept the dedication of the John Wayne Gulch subject to the Easements to be granted to Grantee by Grantor as hereinabove set forth. Further, the City of Newport Beach agrees to those portions of the Easement Agreement which govern the approval rights of the City of Newport Beach and to act in a manner consistent with the provisions hereof. DATED: This 3 day of 1997. THE CITY OF NEWPORT BEACH WA / LWOCI \77568.1 -8- 01/29/97 11:50= 0 STATE OF CALIFORNIA ss. COUNTY OF ORANGE 1] On February 3 , 199 7 before me, the undersigned, a Notary Public in and for said County and State, personally appeared Bernard A. Maniscalco and Daniel C. Hedigan , personally known to me (ofX�ftcly ti4� t?i� sit914R snl4sf t�try to be the pe.� o^n'�'swhose name>ds are subscribed to the within instrument and a 9 ledged to me that i l,(.�ie executed the same in the r li Rlr authorized capacity, and that by k signatureson the instrument the entity upon behalf of which the personsacted, executed the within instrument. nancl nd official seal. Commission #1073347 Z .e Notary P1611c — California Orange County My Comm. Expires Oct I, 1999 �Ci1 Notary Public STATE OF ss. On , 199_ before me, the undersigned, a Notary Public in and for said County and State, personally appeared Joseph J. Zilber, 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 as a Member of ZG Properties, L.L.C., a California limited liability company, and that by his signature on the instrument the entity upon behalf of which Joseph J. Zibler acted, executed the within instrument. WITNESS my hand and official seal. Notary Public LWOCl \73568.1 -9- 01/29/97 11:50= 0 STATE OF CALIFORNIA ss. COUNTY OF ORANGE 0 On February 3 , 199 7 before me, the undersigned, a Notary Public in and for said County and State, personally appeared Bernard A. Maniscalco and Daniel C. Hedigan , personally known to me (dfx�fi c# l ti9tl tPig H65YsxmR Tanfarrt� x�vldextat� to be the per onsvhose namexis are subscribed to the within instrument and a 4 ledged to me that ME executed the same in the r M�)� authorized capacity, and that by = signatureson the instrument the entity upon behalf of which the personsacted, executed the within instrument. handyind official seal. commission 1U163 1 Z @my Notary Public — Colltornia Orange County Comm. Expires Oct 1. 1999 ,lam Notary Public STATE OF HAwAIi ) ) ss. CITY AND COUNTY OF HONOLULU ) On Hilr-6 n 4- , 1997 before me, the undersigned, a Notary Public in and for said County and State, personally appeared Joseph J. Zilber, 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 as a Member of ZG Properties, L.L.C., a California limited liability company, and that by his signature on the instrument the entity upon behalf of which Joseph J. Zibler acted, executed the within instrument. WITNESS my hand and official seal. I NOTARY Notary Public fAj �AtaA`J5iM txp%'res 22- -I3 -'25. LWOC3173568.1 -9- 01129197 11:50= • • STATE OF HAWAII ) ss. COUNTY OF MAUI ) On `"moAcil -1 , 1994 before me, the undersigned, a Notary Public in and for said County and State, personally appeared J. Stephen Goodfellow, personally known to me to be the person whose name is subscribed to the within instrument and acknowledge to me that he executed the same in his authorized capacity as a Member of ZG Properties, L.L.C., a California limited liability company, and that by his signature o the instrument the entity upon behalf of which J. Stephen Goodfellow acted, executed the within instrument. WITNESS my hand and official seal. PETfo,,'tA 9�q t 1rpP , p4i�rR OF Notary Public Mewl c,UmvnxS�tSyt LW'OCIN7350.1 -10- oir-9197 11:50= • • Exhibit "1" to the Easement Agreement Legal Description of Easement Area That portion of Block 55 of Irvine's Subdivision in the City of Newport Beach, County of Orange, Slate of California, as said subdivision is shown on a map recorded in Book 1 Page 88 of Miscellaneous Maps, in the office of the County Recorder of said county, described as follows: Beginning at the northwest corner of Parcel 2 of the Parcel Map recorded in book 17, page 3 of Parcel Maps as recorded in the office of the County Recorder of Orange County on September 4, 1968, thence N. 83 °40'23' E. along the northerly line of said parcel, 182.66 feet to the true point of beginning. Thence along the following described courses: N. 83 °40'23' E. distant 128.49 feet along the northerly line of parcel 2 of P.M. Book 17, page 3, to the comer of said parcel; Thence. S. 56 °12'45' E. distant 439.63 feet along the northeasterly line of said parcel; Thence, N. 24 °42'18' W. distant 80.23 feel; Thence, N. 12 048'40" W. distant 42.14 feet; Thence, N. 66 °24'04' W. distant 73.34 feet; Thence, N. 60 °40'23' W. distant 214.08 feet; Thence. N. 36631'41'W. distant 150.69 feet; Thence. S. 50 °51'45' W. distant 101.20 feet; Thence, S. 20 °34'13' W. distant 80.19 feet to the true point of beginning. Subject property consists of an area of 34,014 square feet, more or less. ;n jl 128 4�' ai c� 1Rhtlt �{YseNt —nr; HYATT - NFWFOAF'TUP Proposed Aclra;± t -•n 0.781 Acr4��. 34,014 Sq,Ft. 1t?0 LCLiIII� C- S:= � -. - -- � " 4g 4p'W 14' N24'42 id"d A4 LWOC117B568.1 -11- 01/29797 11:50am 0 Exhibit "2" to the Easement Agreement Legal Description of Development Parcel THAT PORTION OF A PARCEL MAP IN THE CITY OF NEWPORT BEACH, COUNTY OF ORANGE, STATE OF CALIFORNIA, RECORDED IN BOOK 17 PAGE 3 OF PARCEL MAPS IN THE OFFICE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT THE MOST NORTHERLY CORNER OF A PARCEL MAP RECORDED IN BOOK 61 PAGE 5 OF PARCEL MAPS IN THE OFFICE OF SAID COUNTY RECORDER; THENCE S33 °47'15 "W ALONG THE WESTERLY LINE OF SAID PARCEL MAP 362.00 FEET; THENCE S36° 12'45 "E 215.50 FEET TO THE NORTHWESTERLY LINE OF JAMBOREE ROAD; THENCE S33 °47'15 "E 345.00 FEET; THENCE N56 012'45 "W 215.50 FEET; THENCE N33 047'15 "E 132.50 FEET; THENCE N04 °58'24 "E 193.36 FEET; THENCE N33 047'15 "E 171.22; THENCE NI 1'12'44"W 187.52 FEET; THENCE N56 °12'43 "W 352.35 FEET; THENCE S83 040'23 "W 127.08 FEET; THENCE S05 010'27 "W 249.97 FEET; THENCE N84 °49'33 "W 141.53 FEET TO A POINT ON A CURVE CONCAVE WESTERLY HAVING A RADIUS OF 840.00 FEET, SAID POINT BEING ON THE EASTERLY LINE OF BACK BAY DRIVE, A RADIAL AT SAID POINT BEARS N75 °03'30 "W; THENCE NORTHERLY ALONG SAID CURVE THROUGH A CENTRAL ANGLE OF 21 °16'07" AN ARC DISTANCE OF 311.81 FEET; THENCE N83 °40'23 "E 311.15 FEET .ALONG A NORTHERLYLINE OF PARCEL MAP 17 -3; THENCE S56 °12'45 "E ALONG A NORTHERLY LINE OF SAID PARCEL MAP 594.50 FEET TO THE POINT OF BEGINNING. LWCC1 \73568.1 -12- 01/29/97 W50. u Exhibit "3" to the Easement Agreement 0 Legal Description of Perimeter Easement Parcel That certain real property composed of a fifteen (15.00) foot wide strip of land being the northerly fifteen (15 -00) feet of Parcel 2 as shown on a Parcel Map recorded in Book 17, Page 3, of Maps, Office of the County Recorder of Orange County, California, and the northerly fifteen (15.00) feet of Parcel 2 as shown on a Parcel Map recorded in Book 61, Page 5, of Maps, office of the County Recorder of said County. LWOCl \73568.1 -13- 01/29197 11:50am State of California County of Orange OnffWA before me, Monica S, Kutz, Notary Public, personally appeared personally known to me - OR - ❑ proved tome on the basis of satisfactory evidence to be the person(s) whose name(s) is /are subscribed to the within instrument and acknowledged to me that he /she /they executed the same in his /her /their authorized capacity(ies), and that by his /her /their signature(s) on the instrument the person(s), orthe entity upon behalf of which the person(s) acted, executed the instrument. Monica S. Kutz ; V�{ Comm. 01013469 V NOTARY PUBLIC CALIFORNIA ORANGE COUNTY 0 „T. Comm S4,06JW 13,1099 CAPACITY CLAIMED BY SIGNER _ Individual _ Corporate Officer _ Limited Partner General Partner _ Attorney -in -Fact Trustee(s) _ Guardian /Conservator Other: Signer is Representing: WITNESS my hand and official seal. f I �3•T,• i T�7 [•]: [•] � t f d•7 ; t� 1 I•Z•I9,r,1 � � i Title or Type of Document Number of Pages Date of Document Signer(s) Other Than Named Above