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RES-2021-102RESOLUTION NO.2021- 102 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ANAHEIM APPROVING AN OWNER PARTICIPATION AGREEMENT, SUBSTANTIALLY IN THE FORM ATTACHED, BY AND BETWEEN THE CITY OF ANAHEIM AND LAB HOLDING, LLC; AUTHORIZING THE CITY MANAGER TO FINALIZE SUCH OWNER PARTICIPATION AGREEMENT; AUTHORIZING THE CITY MANAGER TO IMPLEMENT SUCH OWNER PARTICIPATION AGREEMENT; AND MAKING CERTAIN OTHER FINDINGS IN CONNECTION THEREWITH WHEREAS, the City of Anaheim (the "City") is a California municipal corporation and charter city; WHEREAS, the City Council ("City Council") for the City is authorized and empowered under its Charter to enter into agreements for the development of real property, and to make and execute contracts and other instruments necessary or convenient to exercise its powers; WHEREAS, on January 12, 2016, the City Council approved a Disposition and Development Agreement between City and LAB Holdings, LLC ("LAB") for the sale and development of the property referred to therein as Project Site No. 1, Project Site No. 2, Project Site No. 3, and Project Site No. 4 (the "DDA"); WHEREAS, Project Site No. 1, Project Site No. 3, and Project Site No. 4 will continue to be governed by the DDA; WHEREAS, the parties now desire that the development of Project Site No.2 be governed by the Owner Participation Agreement; WHEREAS, the City has duly considered all terms and conditions of the presently drafted Owner Participation Agreement and has determined that the Owner Participation Agreement is in the vital and best interest of the City and the health, safety, morals and welfare of its residents, and in accord with the goals, objectives and public purposes and provisions of applicable state and local laws. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ANAHEIM AS FOLLOWS: Section 1. The City Council hereby finds and determines that the foregoing recitals are true and correct and are a substantive part of this Resolution. Section 2. The City Council hereby approves the Owner Participation Agreement, substantially in the form attached, with such changes as may be mutually agreed upon by the Developer, the City Attorney and the City Manager (or his duly authorized designee) (herein the "City Manager"), respectively, as are minor and in substantial conformance with the form of the 4810-5953-433 1 v2/022363-0015 Owner Participation Agreement submitted herewith. The City Manager and the City Clerk are hereby authorized to execute and attest the Owner Participation Agreement, including any related attachments, on behalf of City. In such regard, the City Manager is authorized to sign the final version of the Owner Participation Agreement after completion of any such non - substantive, minor revisions. Copies of the final form of the Owner Participation Agreement, when duly executed and attested, shall be placed on file in the office of the City Clerk. Further, the City Manager is authorized to implement the Owner Participation Agreement and take all further actions and execute all documents referenced therein and/or necessary and appropriate to carry out the transaction contemplated by the Owner Participation Agreement, including all exhibits thereto. The City Manager is hereby authorized to the extent necessary during the implementation of the Owner Participation Agreement to make technical or minor changes and interpretations of the Owner Participation Agreement after execution, as necessary to properly implement and carry out the Owner Participation Agreement, including all exhibits thereto, provided any and all such changes shall not in any manner materially affect the rights and obligations of the City under the Owner Participation Agreement. Section 3. In addition to the authorization of Section 2 above, the City Manager is hereby authorized, on behalf of the City, to sign all other documents necessary or appropriate to carry out and implement the Owner Participation Agreement, including all exhibits thereto and including causing the issuance of warrants in implementation thereto, and to administer the City's obligations, responsibilities and duties to be performed under the Owner Participation Agreement, including all exhibits thereto. Section 4. The City Clerk shall certify to the adoption of this Resolution. 2 4810-5953-433 1 v2/022363-0015 THE FOREGOING RESOLUTION is approved and adopted by the City Council of the City of Anaheim this 2 _ __ day of November , 2021, by the following roll call vote: AYES: Mayor Sidhu and Council Members Faessel, Diaz, Ma'ae, Moreno, Valencia, and O'Neil NOES: None ABSENT: None ABSTAIN: None CITY OF ANAHEIM M. ATTE CITY CLEAK OF THE CITY OF ANAHEIM 3 4810-5953-433 1 v2/022363-0015 OWNER PARTICIPATION AGREEMENT By and Between CITY OF ANAHEIM And LAB HOLDING, LLC 4851-91734762vl2/022363-0015 TABLE OF CONTENTS Page 100. INTRODUCTORY PROVISIONS........................................................................................... I 101. Definitions.....................................................................................................................1 102. Representations, Warranties and Covenants.................................................................6 102.1 City Representations Warranties and Covenants .............................................. 6 102.2 Developer's Representations, Warranties and Covenants ................................ 7 102.3 City and Developer Representation Re Authority and Enforceability ............. 9 103. Transfers of Interest in Property or Agreement............................................................ 9 103.1 Prohibition Against Transfer Prior to Release of Construction Covenants......................................................................................................... 9 103.2 Permitted Transfers.......................................................................................... 9 103.3 Transfer to Tri Pointe.....................................................................................10 103.4 Assignment and Assumption Agreement.......................................................10 103.5 City Action Re Requested Transfer................................................................10 103.6 Exempt Transfers............................................................................................ I I 200. DISPOSITION OF PROJECT SITE NO.2............................................................................11 201. Conveyance of Project Site No. 2 to Developer.........................................................11 202. Amended and Restated Promissory Note and Amended and Restated Deed of Trust............................................................................................................................11 203. Studies, Reports..........................................................................................................11 203.1 Delivery of Property Documents....................................................................11 203.2 Property Investigation....................................................................................11 203.3 As -Is Environmental Condition......................................................................11 203.4 Indemnities and Releases Re Hazardous Materials........................................12 300. DEVELOPMENT OF PROJECT SITE NO.2.......................................................................12 301. Scope of Development................................................................................................12 302. Design Review............................................................................................................13 303. Land Use Approvals...................................................................................................13 304. Schedule of Performance............................................................................................13 305. Cost of Construction...................................................................................................13 306. Insurance Coverage.....................................................................................................13 307. Developer's Indemnity................................................................................................15 308. Rights of Access.........................................................................................................15 309. Compliance with Governmental Requirements..........................................................15 309.1 Nondiscrimination in Employment................................................................15 310. Release of Construction Covenants............................................................................16 311. Rights of Holder and City under Construction Financing..........................................16 311.1 Holder Not Obligated to Construct Developer Improvements .......................16 311.2 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure................................................................................................................17 311.3 Failure of Holder to Complete Developer Improvements..............................17 311.4 Right of the City to Cure Mortgage or Deed of Trust Default .......................18 312. Moderate Income Housing..........................................................................................18 400. [INTENTIONALLY OMITTED]...........................................................................................18 500. DEFAULTS AND REMEDIES..............................................................................................18 501. Default Remedies........................................................................................................18 i 4851-9173-4762v12/022363-0015 TABLE OF CONTENTS (Continued) Page 502. Institution of Legal Actions........................................................................................19 503. Rights and Remedies Are Cumulative........................................................................19 504. Inaction Not a Waiver of Default................................................................................21 505. Applicable Law...........................................................................................................21 600. GENERAL PROVISIONS...................................................................................................... 21 601. Notices, Demands and Communications Between the Parties ................................... 21 602. Extension of Times of Performance............................................................................ 22 603. Non Liability of Officials and Employees of City and Developer .............................. 23 604. Relationship Between City and Developer................................................................. 23 605. Approvals and Actions................................................................................................ 23 606. Commencement of City Review Period...................................................................... 23 607. Successors and Assigns............................................................................................... 23 608. Counterparts................................................................................................................23 609. Integration................................................................................................................... 23 610. Attorneys' Fees........................................................................................................... 24 611. Administration............................................................................................................24 612. Titles and Captions..................................................................................................... 24 613. Interpretation............................................................................................................... 24 614. No Waiver...................................................................................................................24 615. Modifications.............................................................................................................. 24 616. Severability................................................................................................................. 24 617. Computation of Time..................................................................................................25 618. Legal Advice...............................................................................................................25 619. Time of Essence.......................................................................................................... 25 620. Cooperation.................................................................................................................25 621. Conflicts of Interest..................................................................................................... 25 622. Time for Acceptance of Agreement by the City ......................................................... 26 623. Recordation of Memorandum of Agreement.............................................................. 26 ii 4851-91734762v12/022363-0015 LIST OF EXHIBITS EXHIBIT A SITE MAP EXHIBIT B LEGAL DESCRIPTION OF PROJECT SITE NO. 2 EXHIBIT C SCOPE OF DEVELOPMENT EXHIBIT D SCHEDULE OF PERFORMANCE EXHIBIT E ASSIGNMENT AND ASSUMPTION AGREEMENT EXHIBIT F RELEASE OF CONSTRUCTION COVENANTS EXHIBIT G MEMORANDUM OF AGREEMENT EXHIBIT H DESIGN REVIEW PROCESS EXHIBIT I AMENDED AND RESTATED PROMISSORY NOTE EXHIBIT J AMENDED AND RESTATED DEED OF TRUST WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING EXHIBIT K PREMISES ENVIRONMENTAL INSURANCE REQUIREMENTS 4851-91734762v12/022363-0015 OWNER PARTICIPATION AGREEMENT This OWNER PARTICIPATION AGREEMENT (this "Agreement") dated as of 2021 (the "Date of this Agreement"), is entered into by and between the CITY OF ANAHEIM, a California municipal corporation and charter city (the "City"), and LAB HOLDING, LLC, a California limited liability company (the "Developer"). RECITALS A. The City and Developer entered into a Disposition and Development Agreement dated January 12, 2016 (the "DDA"), with regard to the disposition and development of property referred to therein as Project Site No. 1, Project Site No. 2, Project Site No. 3, and Project Site No. 4, as described in the DDA. B. Project Site No. 1, Project 3, and Project Site No. 4 will continue to be governed by the DDA if and to the extent still applicable. C. As of the Date of Agreement, the development and operation of Project Site No. 2 will be governed by this Agreement and will no longer be subject to the terms of the DDA. Project Site No. 2 is shown on the Site Map attached hereto as Exhibit_A and described in the Legal Description attached hereto as Exhibit B. D. The Developer has proposed to construct a project ("Project') on Project Site No. 2 as more particularly described on the Scope of Development attached hereto as Exhibit C within the timeframes described in the Schedule of Performance attached hereto as Exhibit D. E. The development and operation of the Project on Project Site No. 2 as provided in this Agreement is in the vital and best interest of the City and the welfare of its residents and are in accordance with the public purposes and provisions of applicable state and local laws. Without limiting the foregoing, development and operation of the Project will result in substantial benefits to the City. NOW, THEREFORE, the City and the Developer hereby agree as follows: 100. INTRODUCTORY PROVISIONS 101. Definitions. Capitalized terms within this Agreement shall have the meanings set forth below, or if not defined in this Section 101, shall have the meaning ascribed thereto when such terms are first used herein: "Agreement" means this Owner Participation Agreement by and between the City and Developer, including all exhibits. "Amended and Restated Deed of Trust with Absolute Assignment of Leases and Rents, Security Agreement and Fixture Filing" means the deed of trust in the form attached hereto as Exhibit J and incorporated herein by reference securing repayment of the Amended and Restated Promissory Note. 4851-91734762v12/022363-0015 "Amended and Restated Promissory Note" means the note in the form attached hereto as Exhibit J and incorporated herein by reference evidencing the Developer's obligation to pay the balance of the Purchase Price to the City concurrently with the earlier to occur of August 31, 2022 or the date on which Developer completes the assignment to Tri Pointe of all of its rights and obligations under the Agreement. "Amendment/Estoppel Costs" is defined in Section 620. "Assignment and Assumption Agreement" is attached hereto as Exhibit E. "Best of City's Knowledge" means the knowledge of Grace Ruiz-Stepter without duty of further inquiry. "Best of Developer's Knowledge" means the knowledge of Shaheen Sadeghi without duty of further inquiry. "Breach" is defined in Section 501. "Certificate of Occupancy" means a certificate of occupancy issued by the City pursuant to Section 309 of the 1997 Uniform Administration Code or any successor ordinance. "City", is defined in the first paragraph hereof, means the City of Anaheim, a California municipal corporation and charter city. "City Manager" means the city manager or his/her designee. "Closing" is the date on which City conveyed Project Site No. 2 to Developer. "Completion," "Completed" or "Complete(s)" means the completion of construction of the Developer Improvements as evidenced by a final Certificate of Occupancy issued by the City. "Construction Commencement Date" means the date that is set forth in the Schedule of Performance as the date upon which the construction of the Developer Improvements, pursuant to validly issued building permits, is to commence. "Construction Financing" means a loan, from a reasonably qualified institutional lender ("Construction Lender") in an amount which, when aggregated with equity capital, is sufficient to fund the acquisition of Project Site No.2 and construction of the Developer Improvements in accordance with this Agreement. "Construction Lender" is defined within the definition of Construction Financing. "Date of this Agreement" means the date of approval of the Agreement by the City. "DDA" is defined in Recital A. "Deed of Trust" means that certain Deed of Trust with Absolute Assignment of Leases and Rents, Security Agreement and Fixture Filing (First Priority), made by Developer, as trustor, to First American Title Insurance Company, as trustee, for the benefit of the City, as beneficiary, dated March 31, 2016 and recorded April 1, 2016 as Instrument No. 2016000139770 in the Official 2 4851-91734762v12/022363-0015 Records of Orange County, as assigned pursuant to that certain Assignment and Assumption Agreement (Note and Deed of Trust), dated as February 8, 2016, and recorded April 1, 2016 as Instrument No. 2016000140994 in the Official Records of Orange County. "Default" is defined in Section 501. "Design Development Drawings" is defined in Exhibit H, attached hereto and incorporated by reference. "Design Review Process" is described in Exhibit H, attached hereto and incorporated herein by reference. "Developer" means Lab Holding, LLC, a California limited liability company. "Developer/City Request" is defined in Section 620. "Developer Improvements" means the specific improvements to be constructed by Developer for the Project Site No. 2, as more particularly described in the Scope of Development. "Enforced Delay" is defined in Section 602. "Environmental Law" means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 USC § 9601 et seq.), the Hazardous Materials Transportation Act, as amended (49 USC § 1801 et seq.), the Resource Conservation and Recovery Act of 1976, as amended (42 USC § 6901 et seq.), the Toxic Substances Control Act (15 USC § 2601 et seq.), the Insecticide, Fungicide, Rodenticide Act (7 USC § 136 et seq.), the Superfund Amendments and Reauthorization Act (42 USC § 6901 et seq.), the Clean Air Act (42 USC § 7401 et seq.), the Safe Drinking Water Act (42 USC § 300f et seq.), the Solid Waste Disposal Act (42 USC 6901 et seq.), the Surface Mining Control and Reclamation Act (30 USC § 1201 et seq.), the Emergency Planning and Community Right to Know Act (42USC §§ 11001 etseq.), the Occupational Safety and Health Act (29 USC § 655 and 657), the California Underground Storage of Hazardous Substances Act (Health and Safety Code § 25280 et seq.), the California Hazardous Substances Account Act (Health & Safety Code § 25300 et seq.), the Porter -Cologne Water Quality Act (Water Code § 13000 et seq.), together with any amendments of or regulations promulgated thereunder and any other federal, state, and local laws, statutes, ordinances, or regulations now in effect that pertain to occupational health or industrial hygiene. "Exempt Transfer" means (i) a Transfer of a residence or dwelling unit to a member of the homebuying public without regard to whether or not all of the Developer Improvements on Project Site No. 2 have been completed at the time of such transfer; (ii) a Transfer of any open space lots or common area to a homeowners' association; and (iii) a dedication or Transfer of property to a utility company or govemmental/quasi-governmental entity as described in Section 103.2(a). "Exempt Transferee" mean the person or entity to whom an Exempt Transfer is made. "Governmental Requirements" means all valid and enforceable laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State, the County, the City or any other political subdivision in which the Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over the Agency, the Developer or the Site, including, without limitation, all applicable state labor standards, the City zoning and development 4851-91734762v12/022363-0015 standards, building, plumbing, mechanical and electrical codes, and all other provisions of the City Municipal Code, and all applicable disabled and handicapped access requirements, including without limitation (to the extent applicable), Labor Code Sections 1770 et seq., the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil Code Section 51, et seq. "Guaranty" means the guaranty by Lab Holdings, LLC of the obligation set forth in Section 203.4(a) in the form of the Guaranty attached hereto as Exhibit K. "Hazardous Materials" means any toxic substance, material, or waste which is now regulated by any local governmental authority, the State of California, or the United States Government under any Environmental Law and includes asbestos, petroleum, petroleum products, polychlorinated biphenyls, urea formaldehyde, radon gas, radioactive matter, and chemicals which may cause cancer or reproductive toxicity. "Holder" is defined in Section 311.1. "Homebuyer Downpayment Assistance Program" means each of the Anaheim Downpayment Assistance Programs which include, as of the Date of Agreement, the Building Equity and Growth in Neighborhoods ("BEGIN") and such other assistance programs consistent with the requirements of the Initial Buyer's senior lender providing insured financing pursuant to Federal Housing Administration requirements. "Indemnify" means indemnify, defend, pay for, and hold harmless. "Indemnitees" means the City, and its representatives, officers, employees and agents. "Insurance" is defined in Section 306 et seq. "Land Use Approvals" is defined in Section 303. "Legal Description" means the legal description of Project Site No. 2 attached hereto as Exhibit B. "Liabilities" means liabilities, suits, actions, claims, demands, penalties, damages (including without limitation, penalties, fines, and monetary sanctions), giving rise to losses, costs or expenses (including, without limitation, consultants' fees, and reasonable attorneys' fees) of any kind or nature and for any damages, including damages to property or injuries to person, including accidental death, (including reasonable attorneys' fees and costs in connection therewith). "Maturity Date" means the Maturity Date described in the Amended and Restated Promissory Note. "Memorandum" is the Memorandum of Agreement attached hereto as Exhibit G. "Moderate Income Household(s)" means a household earning not more than one hundred twenty percent (120%) of Orange County median income, as determined by the United States Department of Housing and Urban Development and as set forth by regulation of the California 4 4851-9173-4762v12/022363-0015 Department of Housing and Community Development, pursuant to California Health & Safety Code Section 50092. "Nominee" means with respect to a Holder, a party in control of, under common control with or controlled by such Holder. "Notice" is defined in Section 601. "Permitted Transfer" is defined in Section 103.2.1 "Phase(s)" means each Phase of the Developer Improvements as determined prior to issuance of Building Permits. "Premises Environmental Insurance" means insurance coverage described in Exhibit K attached hereto and incorporated herein by reference. "Presence" means the presence, release, use, generation, discharge, storage and disposal of any Hazardous Materials. "Project" means the development use and operation of the Developer Improvements on Project Site No. 2. "Project Site No. 2" is shown on the Site Map. "Promissory Note" means the Promissory Note described in the DDA evidencing the payment of the Purchase Price. "Recognized Environmental Concerns" means the presence or possible presence of any hazardous substances or petroleum products on Project Site No. 2 under conditions that indicate an existing or possible release, a past release, or a material threat of a release of any hazardous substances or petroleum products into structures on Project Site No. 2 or into the ground, ground water, or surface water of Project Site No. 2. The term is not intended to include de minimis conditions that generally do not present a threat to human health or the environment and that generally would not be the subject of an enforcement action if brought to the attention of appropriate governmental agencies. Conditions determined to be de minimis are not Recognized Environmental Conditions. "Release of Construction Covenants" means the document which evidences Developer's satisfactory Completion of the Developer Improvements, or a part thereof (namely, Project Site No. 2), as set forth in Section 310, in the form of Exhibit F. attached hereto and incorporated herein by reference. It is contemplated that multiple Releases of Construction Covenants will be made available as to each Phase upon satisfaction of the conditions precedent to the issuance of a Release of Construction Covenants with respect to each such Phase. Schedule of Performance" means Exhibit D, attached hereto and incorporated herein by reference. The Schedule of Performance sets out the dates and/or time periods by which certain obligations set forth in this Agreement must be accomplished. The Schedule of Performance is I The defined terms "Phase I Environmental Assessment" and "Phase II Environmental Assessment" were deleted since they are not used in this agreement. 4851-9173-4762v12/022363-0015 subject to revision from time to time due to the application of Section 602 hereof and as mutually agreed upon in writing between Developer and the City Manager, and the City Manager is authorized to make such revisions as he deems reasonably necessary. "Scope of Development" means Exhibit C, attached hereto and incorporated herein by reference, which describes the scope, amount and quality of development of the Developer Improvements to be Completed by Developer on Project Site No. 2. "Site Map" means the map of the Project Site No. 2, attached hereto as Exhibit A and incorporated herein by reference. "Surviving Covenants" means the representations, warranties, covenants, obligations and promises of Developer and the City that are intended to survive the City's issuance of the Release of Construction Covenants with respect to each Phase, which include the representations, warranties, covenants, obligations and promises set forth in Sections 203.3, 203.4, 307, 603 and 604; provided, that, such covenants, obligations and promises shall not survive with respect to an Exempt Transfer. The Surviving Covenants shall run with the land and be binding upon heirs, successors and assigns of Developer other than successors and assigns following an Exempt Transfer. "Transfer" means any total or partial sale, transfer, conveyance, assignment, subdivision, financing, refinancing, lease or sublease.. "Transferee" means a voluntary or involuntary successor in interest to the Developer. "Tri Pointe" means Tri Pointe Homes Holdings, Inc., a Delaware corporation, or any entity controlled by, under control of or under common control with Tri Pointe Homes Holdings, Inc. "Tri Pointe PSA" is defined in Section 103.3. "Tri Pointe Transfer" is defined in Section 103.3 102. Representations, Warranties and Covenants. 102.1 City Representations Warranties and Covenants. The City hereby makes the representations, warranties and covenants contained below in this Section 102.1. All of the representations and warranties set forth in this Section 102.1 are effective as of the Date of this Agreement, are true in all material respects as of the Date of this Agreement, and shall be true in all material respects as of the Date of this Agreement, and each shall survive the execution of this Agreement without limitation as to time. (a) The City is a California municipal corporation and charter city. The execution and delivery of this Agreement by the City has been fully authorized by all requisite actions. (b) To the Best of City's Knowledge, the City's execution and delivery of this Agreement does not violate any applicable laws, regulations, or rules, nor to the Best of City's Knowledge after due inquiry, will it constitute a breach or default under any contract, agreement, or instrument to which the City is a party, or any judicial or regulatory decree or order to which the City is a party or by which it is bound; provided however that while City believes this Agreement to be 6 4851-9173-4762v12/022363-0015 enforceable in accordance with its terms, City makes no representations or warranties regarding the enforceability hereof. (c) The City has not made an assignment for benefit of creditors, filed a petition in bankruptcy, been adjudicated insolvent or bankrupt, petitioned a court for the appointment of any receiver of or trustee for it or any substantial part of its property, or commenced any proceeding relating to the City under any reorganization, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or later in effect. There has not been commenced nor is there pending against the City any proceeding of the nature described in the first sentence of this subsection (c). No order for relief has been entered with respect to the City under the Federal Bankruptcy Code. (d) All documents, instruments and other information delivered by the City to Developer pursuant to this Agreement, other than documents, instruments and other information received by City from third parties, are, to the Best of City's Knowledge, true, accurate, correct and complete in all material respects. (e) The City has taken all legally required actions, and no further consent, approval, or authorization of any third person is required with respect to the City's execution delivery, and performance of this Agreement, other than consents, approvals, and authorizations which have already been unconditionally given. (f) To the Best of City's knowledge, except as to the pending land use applications submitted by Developer, (i) there are no pending proceedings to alter or restrict the zoning or other use restrictions applicable to Project Site No. 2, (ii) to condemn all or any portion of Project Site No. 2 by eminent domain proceedings or otherwise, or (iii) to institute a moratorium or similar restriction on building on or issuing certificates of occupancy for construction on Project Site No. 2. (g) to the Best of City's knowledge, there is no pending or threatened action by the City precluding or inhibiting (a) issuance of building permits with respect to Project Site No. 2; (b) issuance of certificates of occupancy for residences on Project Site No. 2; or (c) issuance of water, sewer, or other utility connection permits affecting the development of Project Site No. 2. (h) The City shall, upon learning of any fact or condition which would cause any of the warranties and representations in this Section 102.1 not to be true, during the effectiveness of this Agreement, give written notice of such fact or condition to Developer as soon as is reasonably practicable. Each of the foregoing items (a) through (h), inclusive shall be deemed to be ongoing representations, warranties and covenants. 102.2 Developer's Representations, Warranties and Covenants. Developer hereby makes the representations, warranties and covenants contained below in this Section 102.2. All of the representations and warranties set forth in this Section 102.2 are effective as of the Date of this Agreement, are true in all material respects as of the Date of this Agreement, and shall be true in all material respects as of the Date of this Agreement, and each shall survive the execution of this Agreement without limitation as to time. 7 4851-9173-4762v12/022363-0015 (a) Developer is a duly organized California limited liability company and in good standing under the laws of the State of California and is authorized to carry on its business in California as such business is now conducted and to own and operate its properties and assets now owned and being operated by it, and as set forth in and anticipated by this Agreement. Developer has full right, power and lawful authority to enter into this Agreement and the execution and delivery of this Agreement by Developer has been fully authorized by all requisite actions on the part of Developer. Developer has provided the City with true and correct copies of documentation reasonably acceptable to the City Manager designating the party authorized to execute this Agreement on behalf of Developer. (b) Developer's execution, delivery and performance of its obligations under this Agreement will not violate any applicable laws, regulations, or rules nor to the Best of Developer's Knowledge after due inquiry, will it constitute a breach or default under any contract, agreement, or instrument to which Developer is a party, or any judicial or regulatory decree or order to which Developer is a party or by which it is bound. (c) Developer has not made an assignment for the benefit of creditors, filed a petition in bankruptcy, been adjudicated insolvent or bankrupt, petitioned a court for the appointment of any receiver of or trustee for it or any substantial part of its property, or commenced any proceeding relating to Developer under any reorganization, arrangement, readjustment of debt, dissolution, or liquidation law or statute of any jurisdiction, whether now or later in effect. There has not been commenced nor is there pending against Developer any proceeding of the nature described in the first sentence of this subsection (c). No order for relief has been entered with respect to Developer under the Federal Bankruptcy Code. (d) All documents, instruments, and other information delivered by Developer to the City pursuant to this Agreement are, to the best of Developer's knowledge, true, accurate, correct and complete in all material respects. (e) This Agreement and all documents to be delivered by Developer pursuant to this Agreement, when executed by Developer and delivered, shall constitute the legal, valid and binding obligation of Developer, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally, and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law). The Developer has taken all legally required actions, and no further consent, approval, or authorization of any third person is required with respect to the Developer's execution delivery, and performance of this Agreement, other than consents, approvals, and authorizations which have already been unconditionally given. (f) Developer shall, upon learning of any fact or condition which would cause any of the warranties and representations in this Section 102.2 not to be true, during the effectiveness of this Agreement, immediately give written notice of such fact or conditions to the City. Each of the foregoing items (a) to (f), inclusive shall be deemed to be ongoing representations, warranties and covenants. 8 4851-9173-4762v12/022363-0015 102.3 City and Developer Representation Re Authority and Enforceability. City and Developer hereby covenant, represent and warrant to each other that neither will assert the lack of authority or enforceability of this Agreement against the other. 103. Transfers of Interest in Property or Agreement. 103.1 Prohibition Against Transfer Prior to Release of Construction Covenants. The qualifications and identity of Developer are of particular concern to the City. It is because of those qualifications and identity that the City has entered into this Agreement with Developer. Except as expressly set forth in Section 103.2 below, for the period commencing upon the Date of this Agreement and continuing until the issuance of the Release of Construction Covenants, no Transferee shall acquire any rights or powers under this Agreement, nor shall Developer make any Transfer of Project Site No.2 or any part, or any of the Developer Improvements without the prior written approval of the City, which approval may be granted or withheld in the sole and absolute discretion of the City. Following the issuance of the Release of Construction Covenants, any Transfer shall be governed by Section 103.4. 103.2 Permitted Transfers. Notwithstanding any other provision of this Agreement to the contrary, before the City's issuance of the Release of Construction Covenants as to the Developer Improvements on Project Site No. 2, the City approval of an assignment of this Agreement or Conveyance of Project Site No. 2, shall not be required in connection with any of the following (each of which shall be "Permitted Transfer"): (a) The conveyance or dedication of any portion of Project Site No. 2 to the City, or other appropriate governmental agency, for the purpose of the granting of easements, permits or similar rights to facilitate construction, use and/or operation of the Developer Improvements. (b) Any Transfer for Construction Financing purposes of Project Site No. 2, including the grant of a deed of trust to secure the funds necessary for land acquisition, construction and permanent financing of the Developer Improvements, as applicable (c) Any Transfer of Project Site No. 2 to an entity in which Developer or an entity controlled by, under the control of or in common control with Developer (a) retains operational control over the management, development and construction of the Developer Improvements, and (b) retains a direct or indirect equity interest in profit and losses in the Project. (d) Any Transfer of Project Site No. 2 to a Holder, or its Nominee by foreclosure or deed in lieu of foreclosure, or to a third party purchaser at a foreclosure sale or after foreclosure by the Holder or its Nominee. (e) Any Transfer of Project Site No.2 to a lessee or sublessee of a portion of Project Site No. 2 that is incidental to the primary purpose of the Developer Improvements provided such lessee or sublessee is consistent with the overall use and purpose of the Development Improvements. (f) Any Transfer of Project Site No.2 along with all rights and obligations under this Agreement to Tri Pointe. 48 51-917 3 -4762v 12/0223 63 -0015 (g) Any Transfer of individual condominiums that have been created within such portion of Project Site No. 2 pursuant to the processing of one or more condominium plans for Project Site No. 2. For purposes of this Agreement, Developer shall have the right to make a Permitted Transfer with respect to all of Project Site No. 2 in conformity with the terms and conditions described above, but not portions of Project Site No. 2. The requirement that the Project Site shall be held as one unit and not divided shall be included in the Covenants and the Declaration. 103.3 Transfer to Tri Pointe. Prior to the Date of this Agreement, Developer has entered into a Purchase and Sale Agreement with Tri Pointe (the "Tri Pointe PSA") pursuant to which, and subject to the terms and conditions set forth therein, Developer intends to sell, transfer and assign all of its right, title and interest in Project Site No. 2 to Tri Pointe, including, without limitation, all of Developer's rights and obligations set forth in this Agreement. Developer shall perform all of its obligations set forth in the Tri Pointe PSA in a good faith effort to cause said sale, transfer and assignment to Tri Pointe (the "Tri Pointe Transfer") to occur within thirty (30) business days after the City issues the Land Use Approvals for the Project; provided, however, that Developer shall not be deemed to be in Default of its obligations set forth in this Agreement if, notwithstanding Developer's performance of its obligations under the Tri Pointe PSA, the Tri Pointe Transfer fails to occur or the date of the Tri Pointe Transfer is delayed. As a condition to the City's approval of the Tri Pointe Transfer, Developer shall cause a fully executed original of the Assignment and Assumption Agreement to be delivered to the City; otherwise, the City hereby approves the Tri Pointe Transfer and no additional City approval or consent shall be required with respect to the Tri Pointe Transfer. The Tri Pointe Transfer shall not include any obligations arising under the Amended and Restated Promissory Note or Amended and Restated Deed of Trust; it being the intention of Developer and the City that this Agreement shall be transferred to Tri Pointe free and clear of any obligations, liabilities, claims liens and encumbrances created by or arising out of the DDA, the Amended and Restated Promissory Note and the Amended and Restated Deed of Trust. If for any reason the Tri Pointe Transfer fails to occur, the City Manager or his/her designee shall have the authority on behalf of the City to approve a transfer and assignment by Developer to a substitute transferee as long as the City Manager or designee determines in his/her reasonable discretion that said substitute transferee possesses equal or better qualifications, development experience, and financial capability as compared to Tri Pointe to develop the Project and perform Developer's obligations set forth in this Agreement. If the City Manager or designee approves said substitute transferee, then all of the provisions set forth in this Agreement relative to the Tri Pointe Transfer, including without limitation, with respect to the Assignment and Assumption shall apply equally to the Transfer to the substitute transferee, and the rights and obligations of the substitute transferee after the effective date of the Transfer shall be the same as would have been the case with Tri Pointe. 103.4 Assignment and Assumption Agreement. An executed Assignment and Assumption Agreement (or a document effecting a Transfer that includes the substantive provisions of the Assignment and Assumption Agreement) shall also be required for all proposed Transfers other than Exempt Transfers. 103.5 City Action Re Requested Transfer. Within thirty (30) days after the receipt of a written Notice requesting City approval of a Transfer pursuant to Section 103.3, the City shall either approve or disapprove such proposed assignment or shall respond in writing by stating what further information, if any, the City requires in order to determine the request complete and determine whether or not to grant the requested approval. Upon receipt of such a response, 10 4851-91734762vl2/022363-0015 Developer shall promptly furnish to the City such further information as may be reasonably requested. 103.6 Exempt Transfers. Portions of Project Site No. 2 transferred pursuant to an Exempt Transfer will be transferred free and clear of this Agreement, including any and all covenants and obligations of Developer hereunder. 200. DISPOSITION OF PROJECT SITE NO. 2 201. Conveyance of Project Site No. 2 to Developer. The City conveyed Project Site No. 2 to Developer in accordance with the DDA on or about April 1, 2016. 202. Amended and Restated Promissory Note and Amended and Restated Deed of Trust. The purchase price for Project Site No. 2 is evidenced by the Promissory Note in the principal amount of Two Million Five Hundred Thousand Dollars ($2,500,000), repayment of which is secured by the Deed of Trust both of which are described in the DDA. Payment of the principal amount under the Promissory Note was not made when due. As a result, the parties have agreed to extend the due date of the principal amount and modified the interest rate as set forth in the Amended and Restated Promissory Note. Prior to the Date of the Agreement, Developer has paid all accrued and unpaid interest through the Date of this Agreement. Prior to the Date of this Agreement, as described in the Schedule of Performance, Developer shall execute and deliver to City the Amended and Restated Promissory Note and the Amended and Restated Deed of Trust. Immediately following the Date of this Agreement, as described in the Schedule of Performance, City shall (i) cancel the Promissory Note, (ii) return same to Developer and (iii) City shall cause the Amended and Restated Deed of Trust to be recorded and a deed of reconveyance or similar document to be recorded with respect to the Deed of Trust. 203. Studies, Reports. 203.1 Delivery of Property Documents. Prior to the Closing, City provided Developer with all information in City's possession with respect to the environmental and physical condition of Project Site No. 2 and all contracts and other documents relating thereto. 203.2 Property Investigation. Representatives of the Developer and any prospective users made necessary or appropriate inspections, including geological, soils and/or additional environmental assessments. Developer determined that there are no Recognized Environmental Concerns in, on, under or about Project Site No. 2, including the groundwater, and that Project Site No. 2 is not in violation of any Environmental Law and that the condition of Project Site No. 2 is acceptable to Developer. 203.3 As -Is Environmental Condition. Project Site No. 2 has been conveyed to the Developer in an "as is" environmental condition, with no warranty, express or implied by the City, as to the condition of Project Site No. 2, the soil, its geology, the Presence of known or unknown faults, the suitability of soils for the intended purposes or the presence of known or unknown Hazardous Materials or toxic substances ("Property Condition"). 11 4851-9173-1762v12/022363-0015 203.4 Indemnities and Releases Re Hazardous Materials. (a) Developer Indemnit\_ re Hazardous Materials. Developer shall Indemnify the Indemnitees from and against all Liabilities arising from, related in any respect to, or as a result of (i) the Presence of Hazardous Materials on Project Site No. 2 which Presence first occurred after the Closing, and (ii) the Presence of Hazardous Materials on Project Site No. 2, which Hazardous Materials were not Hazardous Materials as of January 12, 2016, but became Hazardous Materials after January 12, 2016 as a result of an amendment to, or interpretation of, the Environmental Law; provided, that none of the same were directly and proximately caused by City or any of its agents, employees or contractors. City shall cooperate with Developer to ensure that City has assigned to Developer any and all rights that City acquired in its acquisition of Project Site No. 2 or any portion thereof to permit Developer's prosecution of claims against any third parties who are potentially responsible for such Hazardous Materials. Notwithstanding anything to the contrary in the foregoing, (x) upon the occurrence of an Exempt Transfer, the indemnification contained in this Section 203.4(a) shall not apply to an Exempt Transferee; and (y) if Developer provides the City with Premises Environmental Insurance in accordance with the requirements set forth in Exhibit K, then from and after such date (the "Indemnity Termination Date") Developer shall have no further obligation to indemnify the Indemnitees or have any other Liabilities under this Section 203.4, the obligations of Developer in this Section 203.4 shall not constitute a Surviving Covenant and the Indemnitees shall rely on the Premises Environmental Insurance as their sole recourse in the event of any Liabilities that arise due to the Presence of Hazardous Materials on Project Site No. 2. Concurrently with the issuance of the first building permit for the Project, the parties agree to modify the Grant Deed to reflect the fact that the "Surviving Covenants" set forth in Section I of the Grant Deed with respect to the DDA are of no further force and effect and shall instead reference the Surviving Covenant to be performed in accordance with the terms of this Agreement. Furthermore, upon the occurrence of the Indemnity Termination Date, the parties agree to modify the Grant Deed to reflect the fact that obligations set forth in this Section 203.4 shall no longer constitute a Surviving Covenant. (b) Developer Release. Developer agrees to and hereby shall release the Indemnitees from and against all Liabilities arising from, related in any respect to, or as a result of (i) the Presence of Hazardous Materials on Project Site No. 2 that first existed on Project Site No. 2 as of the Date of this Agreement, but were discovered after the Date of this Agreement, and (ii) the Presence of Hazardous Materials on Project Site No. 2, which Hazardous Materials were not identified and/or defined as such under the Environmental Laws as of the Date of this Agreement but became Hazardous Materials after the Date of this Agreement as a result an amendment to, or interpretation of, the Environmental Law. Notwithstanding the foregoing, Developer is not releasing any person or entity other than the Indemnitees. (c) Notwithstanding anything to the contrary set forth in this Agreement, provisions of this Section 203.4 shall be binding upon the successors and assigns of Developer other than Exempt Transferees. 300. DEVELOPMENT OF PROJECT SITE NO. 2. 301. Scope of Development. Developer shall develop Project Site No. 2 in substantial conformance with the Conceptual Site Plan, Land Use Approvals and the Scope of Development, within the time periods set forth in the Schedule of Performance. Once the Construction Drawings are approved by the City, Developer's obligations under this Agreement with respect to Development 12 4851-9173-4762v12/022363-0015 Improvements shall be construed in accordance with the Construction Drawings. Developer shall diligently improve Project Site No. 2 with the Developer Improvements. 302. Design Review. The Developer Improvements shall be subject to Design Review by the City Manager in accordance with the Design Review Process within the timeframe set forth in the Schedule of Performance. 303. Land Use Approvals. Except to the extent otherwise expressly set forth herein, prior to commencement of construction of the Developer Improvements upon Project Site No. 2, Developer shall, at its sole cost and expense, use commercially reasonable efforts to secure, subject to the exercise by the City of its sole and absolute discretion, design review and/or any other entitlements, permits or approvals required by any other governmental agency (the "Land Use Approvals"). Notwithstanding anything to the contrary herein, Developer and City acknowledge and agree that Developer shall prepare, at Developer's expense, and process all documentation required by the California Environmental Quality Act ("CEQA") with respect to Project Site No. 2. Costs of any Project related on -site (as described in the Scope of Development) CEQA mitigation shall be borne by Developer. Developer acknowledges that compliance with any such CEQA mitigation shall be a condition under applicable law for proceeding with Project Site No. 2. By its execution of this Agreement, the City is not committing itself to or agreeing to undertake any Land Use Approvals or any other acts or activities requiring the subsequent independent exercise of discretion by the City, the City Council, the Planning Commission or any department of the City. The City reserves final discretion and approval as to any and all Land Use Approvals and all proceedings and decisions in connection therewith. 304. Schedule of Performance. Developer shall submit the Construction Drawings, commence and Complete all construction of the Developer Improvements, and satisfy all other obligations and conditions of this Agreement which are the obligation of Developer within the times established therefore in the Schedule of Performance; provided that Developer shall not be in Breach if Land Use Approvals are not secured within the time described in the Schedule of Performance as long as Developer continues to actively pursue such Land Use Approvals using commercially reasonable efforts. The Schedule of Performance is subject to revision from time -to -time as mutually agreed upon in writing by Developer and the City Manager. 305. Cost of Construction. All of the cost of planning, designing, developing and constructing all of the Developer Improvements, including but not limited to the securing of Land Use Approvals, permits, and entitlements of any kind, compliance with any and all environmental laws and regulations, and payment or other satisfaction of development impact fees payable in connection with the Developer Improvements, shall be borne solely by Developer. 306. Insurance Coverage. Without limiting City's right to indemnification, it is agreed that Developer shall secure, prior to commencing any activities under this Agreement, and maintain, during the term of this Agreement insurance coverage as follows: (a) Workers' Compensation Insurance as required by California law and Employers Liability Insurance in an amount not less than $1,000,000 per occurrence. (b) Commercial General Liability Insurance, including coverage for premises and operations, contractual liability, bodily injury, personal injury liability, 13 4851-91734762v12/022363-0015 products/completed operations liability, and independent Developer's liability, in an amount not less than a combined single limit policy for both personal injury and property damage in the amount of $5,000,000, which may be satisfied through a combination of primary, excess, and/or umbrella policies and which will be considered equivalent to the required minimum limits. Such insurance shall be written on a primary basis, but may include a deductible of not more than $10,000 per occurrence unless approved by the City, provided that such deductible or self -insured retention is disclosed to City, in writing, as of the Date of this Agreement. (This coverage written with a Self - Insured Retention must be submitted for approval by the Risk Manager as of the Date of This Agreement.) The policy shall also include the following: "This insurance shall not be cancelled, or limited in scope or coverage, until after thirty (30) days prior written notice has been given to the City Clerk, City of City, 200 S. City Blvd., City, CA 92805, except in the event of cancellation for non-payment of premium that shall provide for not less than ten (10) days' notice." Each insurance policy required by this Agreement, except policies for workers' compensation, shall contain the following clauses or shall otherwise provide for the following conditions: "It is agreed that any insurance maintained by Developer pursuant to this Agreement shall be primary to, and not contribute with, any insurance or self- insurance maintained by the Authority and/or City." "The City and Authority, its officers, agents, employees, representatives and City or Authority designated volunteers are added as additional insured as respects the acts, omissions, operations and activities of, or on behalf of, the named insured, in regard to products supplied to, or work or services performed for, or related to, the City." Prior to commencing any work under this Agreement, Developer shall deliver to City insurance certificates confirming the existence of the insurance required under this Agreement, and including the applicable clauses referenced above. Also, within thirty (30) days of the execution date of this Agreement, Developer shall provide City (i) endorsements to the insurance policies that add to these policies the applicable clauses referenced above, or (ii) in lieu of said endorsements, documentation acceptable to Authority evidencing that the coverage, terms, and conditions set forth in the above -referenced clauses are otherwise included in said insurance policies. Insurance required hereunder shall be placed with insurers (i) admitted to write insurance in California, (ii) possessing an A. M. Best's rating of A VII or higher, or (iii) otherwise acceptable to Authority, with prior written permission from Authority. In the event that a claim or other legal action is filed against Authority, and if Authority, in its good faith opinion, believes it may have coverage under any of the insurance required herein, then Authority has the right to demand, and to receive within a reasonable time period, copies of the insurance policies related to such required insurance; provided, however, that this provision shall not apply if the parties agree that Developer shall fully defend, hold harmless, and indemnify Authority and City against any such claim or other legal action. In addition to other remedies City may have if Developer fails to provide or maintain any insurance policies or policy endorsements to the extent and within the time herein required, Authority may, at its sole option, terminate this Agreement in accordance with Section 500. 14 4851-91734762v12/022363-0015 Exercise of any of the above remedies, however, is an alternative to other remedies City may have and is not the exclusive remedy for Developer's failure to maintain insurance or secure appropriate endorsements. Nothing herein contained shall be construed in any way as limiting the extent that Developer may be held responsible for payments of damages to persons or property resulting from Developer's, (or Developer's Agent or Sub -Agent, if any) performance of the work covered under this Agreement. In the event Developer hires other persons or firms to perform some of the work related to this Agreement, Developer shall ensure (i) that the acts or omissions of such persons or firms are covered under the above -referenced liability insurance, or (ii) that such firms maintain insurance equal to or better than, and subject to the same limits, terms and conditions as, the insurance required of Developer under this Agreement; and in either instance, Developer shall provide, or cause to be provided, evidence of such insurance coverage, reasonably acceptable to City. 307. Developer's Indemnity. Except as set forth in Section 203.4 with respect to Hazardous Materials, and except as to Exempt Transferees, Developer or, if applicable, any Permitted Assignee shall Indemnify (with one (1) counsel reasonably acceptable to the City, unless there is a conflict of interest by, among or between any of the Indemnitees, whether individuals or entities in which case separate counsel shall be provided by Developer for each such Indemnitee) the Indemnitees from and against any and all Liabilities which result from the performance of this Agreement by Developer or Developer's ownership, development, use, or operation of Project Site No. 2 thereof including, without limitation, liabilities arising out of CEQA and/or Land Use Approvals, excepting those Liabilities which are caused by the Indemnitees' (or any of them) gross negligence or willful misconduct. The City and Developer agree to fully cooperate with one another in any case where no conflict of interest between the parties is apparent. Without limiting the generality of the foregoing, Developer specifically agrees to indemnify, defend and hold harmless Indemnitees from any Liabilities resulting from Developer's failure to comply with all applicable laws in accordance with Section 309 hereof 308. Rights of Access. Subject to reasonable prior notice and subject to reasonable rules as may be imposed by Developer in connection therewith, Representatives of the City shall have the right of access to Project Site No. 2, without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including but not limited to, the inspection of the work being performed in constructing the Developer Improvements and so long as City representatives comply with all safety rules and do not unreasonably interfere with the work of Developer. City shall defend, indemnify, assume all responsibility for and hold the Developer harmless from and against any and all third party liabilities, suits, actions, claims, demands, penalties, damages (including, without limitation, penalties, fines and monetary sanctions), losses, costs or expenses (including, without limitation, consultants' fees, and reasonable attorneys' fees of any kind or nature and for any damages, including damages to property or injuries to persons, including accidental death (including reasonable attorneys' fees and costs), which result from the exercise of such entry. 309. Compliance with Governmental Requirements. Developer shall carry out the design, construction and operation of the Project in conformity with all Governmental Requirements. 309.1 Nondiscrimination in Employment. Developer certifies and agrees that all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding companies, 15 4851-9173-4762v12/022363-0015 and all subcontractors, bidders and vendors, with respect to the construction and operation of the Project, are and will be treated equally by it without regard to, or because of race, color, religion, ancestry, national origin, sex, age, pregnancy, childbirth or related medical condition, medical condition (cancer related) or physical or mental disability, and in compliance with Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sections 2000, et seq., the Federal Equal Pay Act of 1963, 29 U.S.C. Section 206(d), the Age Discrimination in Employment Act of 1967, 29 U.S.C. Sections 621, et seq., the Immigration Reform and Control Act of 1986, 8 U.S.C. Sections 1324b, et seq., 42 U.S.C. Section 1981, the California Fair Employment and Housing Act, California Government Code Sections 12900, et seq., the California Equal Pay Law, California Labor Code Sections 1197.5, California Government Code Section 11135, the Americans with Disabilities Act, 42 U.S.C. Sections 12101, et seq., and all other anti -discrimination laws and regulations of the United States and the State of California as they now exist or may hereafter be amended. Developer shall allow representatives of the City access to its employment records related to this Agreement during regular business hours at Developer's principal office in Anaheim, California to verify compliance with these provisions when so requested by the City. 310. Release of Construction Covenants. Following Completion of the Developer Improvements in conformity with this Agreement and within thirty (30) calendar days following receipt of a written request from Developer, the City shall furnish Developer with a Release of Construction Covenants for the Completed Developer Improvements. The City shall not unreasonably withhold or delay such Release of Construction Covenants. The Release of Construction Covenants shall be conclusive determination of satisfactory Completion of the Developer Improvements and the Release of Construction Covenants shall so state. Upon City's issuance of the Release of Construction Covenants as to each Phase, the parties' rights and obligations set forth in or arising out of this Agreement with respect to such Phase shall automatically terminate with the exception of the Surviving Covenants and any party then owning or thereafter purchasing, leasing or otherwise acquiring any interest in Project Site No. 2 shall not (because of such ownership, purchase, lease or acquisition) incur any obligation or liability under this Agreement. If the City refuses or fails to furnish the Release of Construction Covenants for Project Site No. 2 after written request from Developer, the City shall, within thirty (30) working days of receiving such written request, provide Developer with a written statement setting forth the reasons the City has refused or failed to furnish the Release of Construction Covenants for Project Site No. 2. The statement shall also contain a list of the actions Developer must take to obtain a Release of Construction Covenants, which list shall be based on the requirements set forth in the Construction Documents. If the reason for the City's refusal to issue the Release of Construction Covenants is due to lack of availability of specific landscape and/or finish materials, the Developer may provide a completion bond reasonably acceptable to the City, in which case the Developer shall thereby become entitled to the Release of Construction Covenants. Such Release of Construction Covenants shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of any mortgage, or any insurer of a mortgage securing money loaned to finance the Developer Improvements, or any part thereof. Such Release of Construction Covenants is not a notice of completion as referred to in the California Civil Code, Section 3093. 311. Rights of Holder and City under Construction Financing. 311.1 Holder Not Obligated to Construct Developer Improvements. The holder of any mortgage or deed of trust securing Construction Financing (a "Holder") shall not be obligated 16 4851-9173-4762v12/022363-0015 by the provisions of this Agreement to construct or Complete the Developer Improvements or any portion thereof, or to guarantee such construction or Completion; nor shall any covenant or any other provision in this Agreement be construed so to obligate such Holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such Holder to devote Project Site No. 2 to any uses or to construct any improvements thereon, other than those uses or Developer Improvements provided for or authorized by this Agreement. 311.2 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure. With respect to any mortgage or deed of trust securing Construction Financing, whenever the City delivers any notice of default ("Notice of Default") or demand to Developer with respect to any Breach or Default by Developer in the construction of the Developer Improvements, and if Developer fails to cure the Default within the time set forth in Section 501, the City shall deliver to each Holder of record a copy of such notice or demand. Each such Holder shall (insofar as the rights granted by the City are concerned) have the right, at its option, within sixty (60) days after the receipt of the notice, to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such Default and to add the cost thereof to the mortgage debt and the lien of its mortgage; provided, however if the Holder is legally prevented from curing such default because of a bankruptcy by the Developer or because such cure requires physical possession of Project Site No. 2 then the sixty (60) day period shall be tolled until such bankruptcy is confirmed, rejected or otherwise resolved or the Holder has obtained lawful physical possession of Project Site No. 2. Nothing contained in this Agreement shall be deemed to permit or authorize such Holder to undertake or continue the construction or Completion of the Developer Improvements, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed Developer's obligations to the City by written agreement reasonably satisfactory to the City which election to assume may be made within ninety (90) days following Holder's securing of title to Project Site No. 2. Such assumption shall not have the effect of causing the Holder to be responsible for any prior damage obligations of Developer to the City. The Holder, in that event, must agree to Complete, in the manner provided in this Agreement, the Developer Improvements. Any such Holder properly Completing the Developer Improvements shall be entitled, upon compliance with the requirements of Section 310 of this Agreement, to a Release of Construction Covenants. It is understood that a Holder shall be deemed to have satisfied the sixty (60)day time limit set forth above for commencing to cure or remedy a Developer Breach which requires title and/or possession of Project Site No. 2 (or portion thereof) if and to the extent any such Holder has within such sixty (60) day period commenced foreclosure proceedings to obtain title and/or possession and thereafter the Holder diligently pursues such proceedings to completion and cures or remedies the default. 311.3 Failure of Holder to Complete Developer Improvements. In any case where, sixty (60) days after the Holder receives a Notice of Default by Developer in Completion of Developer Improvements under this Agreement, and the Holder has not exercised the option to construct as set forth in Section 311.3, or if it has exercised the option but has defaulted thereunder and failed to timely cure such default, the City may, by giving written notice to the Holder, purchase the mortgage or deed of trust by payment to the Holder of the amount of the unpaid mortgage or deed of trust debt, including principal and interest and all other sums secured by the mortgage or deed of trust. If the ownership of Project Site No. 2 or any part thereof has vested in the Holder, the City, if it so desires, shall be entitled to a conveyance of title to Project Site No. 2 or such portion thereof from the Holder to the City upon payment to the Holder of an amount equal to the sum of the following: 17 4851-9173-4762v12/022363-0015 (a) The unpaid mortgage or deed of trust debt at the time title became vested in the Holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings); (b) All expenses with respect to foreclosure including reasonable attorneys' fees; (c) The net expense, if any (exclusive of general overhead), incurred by the Holder as a direct result of the subsequent management of Project Site No. 2 or part thereof; (d) The costs of any Developer Improvements made by such Holder; (e) Any prepayment charges, default interest, and/or late charges imposed pursuant to the loan documents and agreed to by Developer; and (f) An amount equivalent to the interest that would have accrued on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by the City. 311.4 Right of the City to Cure Mortgage or Deed of Trust Default. In the event Developer receives a notice of default on any mortgage or deed of trust securing Construction Financing prior to the Completion of the Developer Improvements and issuance of a Release of Construction Covenants, Developer shall immediately deliver to the City a copy of such notice of default. If the Holder of any mortgage or deed of trust securing Construction Financing has not exercised its option to construct, the City shall have the right but not the obligation to cure the default. The City shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by the City in curing such default. The City shall also be entitled to a lien upon Project Site No. 2 to the extent of such costs and disbursements, subordinate to the lien securing the Construction Financing. 312. Moderate Income Housing. If and to the extent funds are available, in the sole and absolute discretion of the City, the City may provide Developer with funds pursuant to the Homebuyer Downpayment Assistance Program for Moderate Income Households. 400. [INTENTIONALLY OMITTED] 500. DEFAULTS AND REMEDIES 501. Default Remedies. Subject to Enforced Delay and compliance with the provisions of this Agreement which provide for the protection of Mortgagee rights, including the provisions of Section 311 of this Agreement, failure or delay by either parry to perform any material term or provision of this Agreement (a "Breach") following notice and failure to cure as described hereafter constitutes a "Default" under this Agreement. The non -defaulting party shall give written notice of any Breach to the party in Breach, specifying the Breach complained of by the non -defaulting party ("Notice of Default"). Delay in giving such Notice of Default shall not constitute a waiver of any Breach nor shall it change the time of Breach. Upon receipt of the Notice of Default, the party in Breach shall promptly commence to cure the identified Breach at the earliest reasonable time after receipt of the Notice of Default and shall complete the cure of such Breach not later than thirty (30) days after receipt of the Notice of 18 4851-9173-4762v12/022363-0015 Default, or, if such Breach cannot reasonably be cured within such thirty (30) day period, then as soon thereafter as reasonably possible, provided that the party in Breach shall diligently pursue such cure to completion("Cure Period"). Failure of the party in Breach to cure the Breach within the Cure Period set forth above shall constitute a "Default" hereunder. Any failures or delay by either party in asserting any of its rights and remedies as to any Breach or Default shall not operate as a waiver of any Breach or Default or of any such rights or remedies. Delays by either party in asserting any of its rights and remedies shall not deprive either party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. 502. Institution of Legal Actions. In addition to any other rights or remedies and subject to the restrictions otherwise set forth in this Agreement, any party may institute an action at law or equity to seek specific performance of the terms of this Agreement, or to cure, correct or remedy any Default, to recover damages for any Default, or to obtain any other remedy consistent with the purpose of this Agreement. Such legal actions must be instituted in the Superior Court of the County of Orange, State of California, in an appropriate municipal court in that county, or in the United States District Court for the Central District of California. 503. Re-entry and Revesting of Title in the City. 503.1 Prior to Recordation of Construction Financing. The City has the right, at its election, to re-enter and take possession of Project Site No. 2 and terminate and Revest in the City the estate conveyed to the Developer if, prior to the recording of Construction Financing on Project Site No. 2, Developer fails to start the Construction of the Developer Improvements as required by this Agreement for a period of ninety (90) days after Notice thereof from the City, subject to extension pursuant to Section 602, upon payment to the Developer of One Million Dollars ($1,000,000). 503.2 After Recordation and Funding of Construction Financing. Without limiting the rights as set forth in Section 311, 501, 502 and without affecting the priority of the lien of the Holder's deed of trust or mortgage, the City has the right, at its election, to reenter and take possession of the Project Site No. 2 with all Developer Improvements thereon, and terminate and Revest in the City the estate conveyed to the Developer only if after the recordation and funding of Construction Financing and prior to the issuance of the final Release of Construction Covenants, the Developer (or its successors in interest) shall: (a) fail to start the construction of the Developer Improvements as required by this Agreement for a period of ninety (90) days after Notice thereof from the City subject to extension pursuant to Section 602; or (b) abandon or substantially suspend construction of the Applicable Developer Improvements required by this Agreement for a period of ninety (90) days after Notice thereof from the City subject to extension pursuant to Section 602; or (c) contrary to the provisions of Section 103 hereof, Transfer or suffer any involuntary Transfer in violation of this Agreement, and such Transfer, if it is a Transfer requiring approval by the City, is not rescinded within thirty (30) days of Notice thereof from City to Developer. 19 4851-9173-4762v12/022363-0015 Such right to reenter, terminate and Revest is subject to the quiet enjoyment, and, if applicable, the right to continue to Complete construction by (i) tenants or other occupants who have (a) executed leases or subleases and (b) incurred substantial expenses in connection with the design and/or construction of improvements required to be constructed by such tenant under such lease or sublease and (ii) Developer, in the case where the Developer is in Default and, vis a vis a Holder or its Nominee, shall be exercisable only if: 1. Such Holder (or its Nominee) (a) shall have failed to cure any Default within the applicable cure periods granted to such Holder (or its Nominee), or (b) shall have given City written notice that it will not cure any such Default or condition or that it will otherwise not comply with the terms and conditions of this Agreement, and 2. City, within ninety (90) days after the occurrence of any events described in subparagraph 1. immediately above, shall commence the exercise of its Right of Entry and shall pay to Holder (or its Nominee) in immediately available funds, the Loan Balance prior to Revesting. In the event of a failure or refusal to cure a Default, as described in subparagraph 1. above, City's sole remedy vis a vis Holder shall be the exercise of the re-entry right and Revesting in accordance herewith. The conditions to the commencement of the exercise of the City's right to re-enter and Revest as described above shall be applicable whether the re-entry and Revesting occurs (a) prior to foreclosure (or deed in lieu of foreclosure) by the Holder (or its Nominee) under its mortgage or deed of trust; or (b) after Holder (or its Nominee) acquires title to the Property by foreclosure (or deed -in -lieu of foreclosure) under its mortgage or deed of trust. The Grant Deed contains reference and provision to give effect to the City's right as set forth in this Section 503, under specified circumstances prior to recordation of the Release of Construction Covenant, to reenter and take possession of Project Site No. 2, with all improvements thereon, and to terminate and Revest in the City the estate conveyed to the Developer. Upon the Revesting in the City of title to the Property, as provided in this Section 503, the City shall, pursuant to its responsibilities under state law, use its reasonable efforts to resell Project Site No. 2, as soon and in such manner as the City shall find feasible and consistent with the objectives of such law, as it exists or may be amended, to a qualified and responsible party or parties (as determined by the City) who will assume the obligation of constructing or Completing the Developer Improvements, or such improvements in their stead as shall be satisfactory to the City in its sole and absolute discretion. (i) First, to reimburse the City, on its own behalf or on behalf of the City, all costs and expenses incurred by the City, excluding City staff costs, but specifically, including, but not limited to, any expenditures by the City in connection with the recapture, management and resale of Project Site No. 2 (but less any income derived by the City from Project Site No. 2, or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to Project Site No. 2, or part thereof which the Developer has not paid (or, in the event that Project Site No. 2 is exempt from taxation or assessment of such charges during the period of ownership thereof by the City, an amount, if paid, equal to such taxes, assessments, or charges as would have been payable if Project Site No. 2 were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on Project Site No. 2 at the time or Revesting of title thereto in the City, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of the Developer, its 20 4851-9173-4762v12/022363-0015 successors or transferees; any expenditures made or obligations incurred with respect to the constructing or Completion of the Developer Improvements or any part thereof on Project Site No. 2; and any amounts otherwise owing the City, and in the event additional proceeds are thereafter available, then (ii) Second, to reimburse the Developer, its successor or transferee, up to the amount equal to the sum of (a) actual and direct third party costs incurred by the Developer for the Developer Improvements existing on Project Site No. 2, at the time of the re-entry and possession, less (b) any gains or net income received by the Developer from Project Site No. 2, or the improvements thereon. Any balance remaining after such reimbursements shall be retained by the City as its property. The rights established in this Section 503, except as may otherwise be provided in this Section 503, are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that the City has conveyed the Site to the Developer for development purposes and not for speculation in undeveloped land. City hereby agrees to execute a recordable Intercreditor Agreement reflecting the terms of Section 311 and this Section 503 at the request of any Construction Lender The provisions of this Section 503 shall not be applicable to Tri Pointe if this Agreement is assigned to Tri Pointe pursuant to the Assignment and Assumption Agreement. The parties agree to modify the Grant Deed concurrently with the assignment of this Agreement to Tri Pointe to reflect this modification. 504. Rights and Remedies Are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other party. 505. Inaction Not a Waiver of Default. Any failures or delays by either party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies, or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. 506. Applicable Law. The laws of the State shall govern the interpretation and enforcement of this Agreement. 600. GENERAL PROVISIONS 601. Notices, Demands and Communications Between the Parties. Any approval, disapproval, demand, document or other notice ("Notice") required or permitted under this Agreement must be in writing and shall be sufficiently given if delivered by hand (and a receipt therefore is obtained or is refused to be given) or dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered by telecopy, or email or overnight delivery service to: 21 4851-91734762v12/022363-0015 To City: City of Anaheim 200 South Anaheim Boulevard, Seventh Floor Anaheim, California 92805 Attention: City Manager With copies to: City of Anaheim 200 South Anaheim Boulevard, Second Floor Anaheim, California 92805 Attention: City Clerk City of Anaheim 200 South Anaheim Boulevard, Third Floor Anaheim, California 92805 Attention: City Attorney with a copy to: Stradling Yocca Carlson & Rauth 660 Newport Center Drive, Suite 1600 Newport Beach, California 92660 Attention: Thomas P. Clark, Jr. To Developer: Lab Holding, LLC 709 Randolph Avenue Costa Mesa, California 92626 Attention: Shaheen Sadeghi with a copy to: Rutan & Tucker, LLP 18575 Jamboree Road 9th Floor Irvine, California 926123 Attention: Peter Howell Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section. 602. Extension of Times of Performance. In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays are due to litigation challenging the validity of this transaction or any element thereof or the right of either parry to engage in the acts and transactions contemplated by this Agreement; without limitation, relocation obligations in connection therewith, inability to secure necessary labor materials or tools; actions in connection with the remediation of Hazardous Materials, including groundwater contamination; war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; acts of terrorism; epidemics and pandemics; quarantine restrictions; shelter in place; orders; government mandated shutdowns; freight embargoes; unanticipated subsurface conditions that delay performance; lack of transportation; governmental restrictions or priority; building moratoria; unusually severe weather; or acts or omissions of the other party; acts or failures to act of the City in its governmental capacity or any other public or governmental agency or entity or any other delays beyond the reasonable control of the party claiming an extension ("Enforced Delay"): Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period reasonably attributable to the Enforced Delay and the party claiming such 22 4851-91734762v12/022363-0015 extension shall promptly notify the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of the City and/or Developer. Notwithstanding any provision of this Agreement to the contrary, the lack of funding to Complete the Developer Improvements shall not constitute grounds of Enforced Delay pursuant to this Section 602. 603. Non Liability of Officials and Employees of City and Developer. No member, official or employee of either party shall be personally liable to the other party or the City, or any successor in interest, in the event of any Default or Breach by the either party or for any amount which may become due to either party or their successors, or on any obligations under the terms of this Agreement. 604. Relationship Between City and Developer. It is hereby acknowledged that the relationship between the City and Developer is not that of a partnership or joint venture and that the City and Developer shall not be deemed or construed for any purpose to be the agent of the other. Accordingly, except as expressly provided herein or in the Exhibits hereto, the City shall have no rights, powers, duties or obligations with respect to the development, operation, maintenance or management of Project Site No. 2. 605. Approvals and Actions. Whenever a reference is made herein to an action or approval to be undertaken by the City, City Manager or his or her designee is authorized to act on behalf of City unless specifically provided otherwise or the context should require otherwise. 606. Commencement of City Review Period. The time periods set forth herein and in the Schedule of Performance for the City's approval of agreements, plans, drawings, or other information submitted to the City by Developer and for any other City consideration and approval hereunder which is contingent upon documentation required to be submitted by Developer shall only apply and commence upon the complete submittal of all the required information. In no event shall an incomplete submittal by Developer trigger any of the City's obligations of review and/or approval hereunder; provided, however, that the City shall notify Developer of an incomplete submittal as soon as is practicable. 607. Successors and Assigns. All of the terms, covenants, conditions, representations, and warranties, of this Agreement shall be binding upon City and Developer and its respective permitted successors and assigns. Whenever the term "Developer" or "City," as the case may be, is used in this Agreement, such term shall include any other permitted successors and assigns as herein provided. 608. Counterparts. This Agreement may be signed in multiple counterparts which, when signed by all parties, shall constitute a binding agreement. This Agreement is executed in three (3) originals, each of which is deemed to be an original. 609. Integration. This Agreement contains the entire understanding between the parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect. Each party is entering this Agreement based solely upon the representations set forth herein and upon each party's own independent investigation of any and all facts such party deems material. This Agreement includes pages 1 through 40 (includes signature page) and Exhibits A through K (each such Exhibit is incorporated in this 23 4851-91734762v12/022363-0015 Agreement as if fully set forth herein) which together constitute the entire understanding and agreement of the parties, notwithstanding any previous negotiations or agreements between the parties or their predecessors in interest with respect to all or any part of the subject matter hereof. 610. Attorneys' Fees. In any action between the parties to interpret, enforce, reform, modify, rescind or otherwise in connection with any of the terms or provisions of this Agreement, the prevailing party in the action shall be entitled, in addition to damages, injunctive relief or any other relief to which it might be entitled, reasonable costs and expenses including, without limitation, litigation costs and reasonable attorneys' fees. Costs recoverable for enforcement of any judgment shall be deemed to include reasonable attorneys' fees. 611. Administration. This Agreement shall be administered and executed by the City Manager, or his/her designated representative, following approval of this Agreement by the City. The City shall maintain authority of this Agreement through the City Manager (or his/her authorized representative). The City Manager shall have the authority but not the obligation to issue interpretations, waive provisions, approve the Declaration, extend time limits, grant design approvals, and/or enter into amendments of this Agreement on behalf of the City so long as such actions do not substantially change the uses or development permitted on Project Site No. 2, or add to the costs to the City as specified herein as agreed to by the City Council, and such amendments may include extensions of time specified in the Schedule of Performance; provided, however, in the event that the City, acting under its land use regulatory authority, in its sole and absolute discretion, does not grant Land Use Approvals sufficient to allow development of any of the Project in accordance with the requirements of the Scope of Development, then, in such event, the City Manager shall have the authority to modify the Scope of Development so as to permit development consistent with then current general plan and zoning ordinance. All other waivers or amendments shall require the written consent of the City Council. 612. Titles and Captions. Titles and captions are for convenience of reference only and do not define, describe or limit the scope or the intent of this Agreement or of any of its terms. Reference to section numbers are to sections in this Agreement, unless expressly stated otherwise. 613. Interpretation. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word "including" shall be construed as if followed by the words "without limitation." This Agreement shall be interpreted as though prepared jointly by both parties. 614. No Waiver. A waiver by either party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by the other party shall not be construed as a waiver of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement. 615. Modifications. Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made in writing and in each instance signed on behalf of each party. 616. Severability. If any term, provision, condition or covenant of this Agreement or its application to any party or circumstances shall be held, to any extent, invalid or unenforceable, the remainder of this Agreement, or the application of the term, provision, condition or covenant to 24 4851-9173-4762vl2/022363-0015 persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law. 617. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens) and including the last day, unless the last day is a holiday or Saturday or Sunday, and then that day is also excluded in which case such day is the day following the excluded day(s). The term "holiday" means all holidays as specified in Section 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time. 618. Legal Advice. Each party represents and warrants to the other the following: they have carefully read this Agreement, and in signing this Agreement, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters set forth in this Agreement, or have knowingly chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have freely signed this Agreement without any reliance upon any agreement, promise, statement or representation by or on behalf of the other party, or their respective agents, employees or attorneys, except as specifically set forth in this Agreement, and without duress or coercion, whether economic or otherwise. 619. Time of Essence. Time is expressly made of the essence with respect to the performance by the City and Developer of each and every obligation and condition of this Agreement. 620. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, to sign any and all documents which may be reasonably necessary, helpful or appropriate to carry out the purposes and intent of this Agreement. In this regard, Developer and the City agree to mutually consider reasonable requests for amendments to this Agreement. In addition, either party may, at any time, and from time to time, deliver written notice to the other party requesting such party to certify in writing that, to the knowledge of the certifying party, (i) this Agreement is in full force and effect and a binding obligation of the parties, (ii) this agreement has not been amended or modified either orally or in writing, and if so amended, identifying the amendments, and (iii) the requesting party is not in default in the performance of its obligations under this Agreement, or if in default, to describe therein the nature and amount of any such defaults. A party receiving a request hereunder shall execute and return such certificate within thirty (30) days following the receipt thereof. City shall have no liability for monetary damages to Developer, any Transferee or Holders, or any other person in connection with, resulting from or based upon the issuance of any such certificate hereunder. The party making the request shall be responsible for the costs incurred by the other party, including without limitation attorneys' fees, (the "Amendment/Estoppel Costs") in connection with any amendments to this Agreement and/or estoppel documents which are requested by such party (the "Developer/City Request") regardless of the outcome of the Developer/City Request. 621. Conflicts of Interest. No member, official or employee of the City shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official or employee participate in any decision relating to the Agreement which affects his/her personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested. 25 4851-91734762v12/022363-0015 622. Time for Acceptance of Agreement by the City. This Agreement, when executed by Developer and delivered to the City, must be authorized, executed and delivered by the City on or before thirty (30) days after signing and delivery of this Agreement by Developer or this Agreement shall be void, except to the extent that Developer shall consent in writing to a further extension of time for the authorization, execution and delivery of this Agreement. 623. Recordation of Memorandum of Agreement. The Memorandum of Agreement shall be recorded concurrently with the Date of Agreement and run with the land for the period of time set forth herein. [SIGNATURES ON NEXT PAGE] 26 4851-91734762vl2/022363-0015 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the respective dates set forth below CITY: CITY OF ANAHEIM, a California municipal corporation and charter city Dated: 20� By: City Manager ATTEST: THERESA BASS CMC, CITY CLERK airy t-1erx APPROVED AS TO FORM: ROBERT FABELA, CITY ATTORNEY Leonie Mulvihill Assistant City Attorney Dated: 4851-9173-4762v12/022363-0015 DEVELOPER: LAB HOLDING LLC, a California limited liability company , 20_ By: Its: S-1 EXHIBIT A SITE MAP OF PROJECT SITE NO.2 SITE MAP PROJE CT SITE NO.2 t Project Site-2.05acres A-1 4851-91734762vl2/022363-0015 EXHIBIT B LEGAL DESCRIPTION OF PROJECT SITE NO.2 PROJECT #2: LOTS 17 THROUGH 23 INCLUSIVE IN BLOCK M OF THE CENTER TRACT, AS PER MAP RECORDED IN BOOK 14, PAGE 13 OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPT THEREFROM ALL OIL, MINERAL, GAS OR OTHER HYDROCARBON SUBSTANCES BELOW A DEPTH OF 500 FEET UNDER THE SURFACE OF SAID LAND, BUT WITHOUT THE RIGHT OF SURFACE ENTRY OR ANY OTHER USE OF THE LAND ABOVE SUCH 500 FOOT DEPTH, AS RESERVED IN DEED RECORDED MAY 05, 1989 AS INSTRUMENT NO. 89-238472, OFFICIAL RECORDS. APN: 037-024-11, and THE NORTH 100 FEET OF LOTS 17 THROUGH 23, INCLUSIVE, IN BLOCK L OF THE CENTER TRACT AS PER MAP RECORDED IN BOOK 14, PAGE 13 OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM MINERAL AND OTHER RIGHTS AS RESERVED BY SOUTHERN PACIFIC COMPANY IN DEED RECORDED DECEMBER 20, 1958, IN BOOK 4528, PAGE 251 OF OFFICIAL RECORDS. APN: 037-1 I 1-29, and THE SOUTH 35 FEET OF LOTS 17 THROUGH 23, INCLUSIVE, IN BLOCK L OF THE CENTER TRACT AS PER MAP RECORDED IN BOOK 14, PAGE 13 OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. APN: 037-111-30 B-1 4851-91734762v12/022363-0015 EXHIBIT C SCOPE OF DEVELOPMENT Unless otherwise specified herein, all capitalized terms in the Scope of Development shall have the meaning(s) set forth in this Owner Participation Agreement (OPA) to which this Scope of Development is attached. The Lumberyard The Project is comprised of approximately fifty (50) to sixty (60) for sale condominium units ranging in size from 1,100 sf to 2,200 sf which may include four (4) live/work units facing public streets. On -site parking will be provided as required. The Developer is required to secure necessary Land Use Approvals from the Planning Commission and City Council. These entitlements are anticipated to include compliance with the California Environmental Quality Act, a Reclassification (Zone Change), and General Plan Amendment. The Developer will be further required to comply with the Project Conditions as approved by the Planning Commission and/or City Council. The Project will be described in the entitlements, as approved. C-1 4851-91734762v12/022363-0015 EXHIBIT D SCHEDULE OF PERFORMANCE THE LUMBERYARD The Parties agree that the Developer Improvements may be constructed in a single phase or on a phased basis. I. PROJECT SITE ASSIGNMENT No. 1. 2. 3. 4. Provision/Description Developer Execution and Delivery of OPA and Amended and Restated Promissory Note. Developer executes and delivers OPA, Amended and Restated Promissory Note and Amended and Restated Deed of Trust to Cite City Execution of OPA; Cancellation and Return of Promissory Note; Recordation of Amended and Restated Deed of Trust; Reconveyance of Deed of Trust. City executes OPA; cancels Promissory Note and returns same to Developer. City causes Amended and Restated Deed of Trust to be recorded and reconveys Deed of Trust. Amended and Restated Promissory Note. Developer shall pay City balance due on Amended and Restated Promissory Note. Reconveyance Deed. Upon payment in full of the Amended and Restated Promissory Note balance, City shall file of Deed of Reconveyance or similar 'a^^""' + — --f that debt is paid in full. D-1 4851-9173-4762vl2/022363-0015 Schedule/Timing Agreement No later than twelve (12) business days prior to City Council meeting to consider )roval of OPA Within ten (10) business days following City Council approval of a OPA The earlier of the date on which a Transfer to Tri Pointe is completed or August 31, 2022 Upon receiving full payment of balance i due under Amended and Restated Promissory Note; City Shall cooperate in pausing reconveyance to occur through the -scrow for the Tri Pointe Transfer such that title to Project Site No. 2 can be conveyed to Tri Pointe free and -lean of the Amended and Restated Deed of Trust. Section 202 Section 202; Exhibit J Section 202; Exhibit K 5. Assignment and Assumption. Developer LAB Holding LLC shall exercise commercially reasonable diligence in an effort to cause the Assignment and Assumption Agreement to be fully executed and delivered to City and the Tri Pointe Transfer to occur. II. DEVELOPMENT OF PROJECT No. Provision/Description Within 30 business days from obtaining Land Use Approvals for the Project. Section 103.3; Exhibit F Schedule/Timing I Agreement Submission of Conceptual Plan Within 5 business days Exhibit? Developer submits Conceptual Plan to City of Date of this Agreement Submission of Design Development Within 30 days after Drawings and all related items required to Date of this obtain Land Use Approvals. Developer Agreement. submits Design Development Drawings, and complete Land Use application to City, including: • Project Site Plan • Design Review Documents • Elevations of all building structures • Preliminary landscape plans • A traffic and circulation plan • A rendered perspective • Tentative Parcel Mal} Developer to Obtain City Approval of Land Developer shall use Use Application commercially 9. Developer to Obtain Approval of Complete Building Improvement Plans. The Building Department shall approve the final Building Improvement Plans for all Developer Improvements, and Developer shall be ready to obtain building I-)ermits. D-2 4851-9173-4762v12/022363-0015 reasonable efforts to obtain the Land Use Approvals no later than February 28, 2022. No later than 11 months from Land Use Approvals. Sections 301 — 303; Exhibit C Sections 303-304 Sections 103.3, 304 III. CONSTRUCTION No. Provision/Description 10. Commencement of Building Improvements. Developer shall commence building improvements on the Site. 11. Completion of Construction. Developer shall complete construction of all of the Residential Improvements. Schedule/Timing Within 30 days from building permit issuance No later than 36 months from the issuance of building permits for the first Agreement Section 304 Section 304 12. Release of Construction Covenants of the Within 30 Days of Section 310 Building Improvements. City shall issue Developer written Releases? to Develoier. request. The foregoing schedule is subject to change based upon the changes mutually approved in writing by the Parties and/or Events of Force Majeure. In addition, in the event of any conflict between the schedule and timing set forth in this Exhibit D and the text of the Agreement, the text of the Agreement shall prevail. D-3 4851-91734762v12/022363-0015 EXHIBIT E ASSIGNMENT AND ASSUMPTION AGREEMENT Recording Requested by and When Recorded Return to: TRI Pointe Homes Holdings, Inc. 5 Peters Canyon Road, Suite 100 Irvine, California 92606 Attention: Tom Grable SPACE ABOVE THIS LINE FOR RECORDER'S USE ASSIGNMENT AND ASSUMPTION AGREEMENT (Owner Participation Agreement) This Assignment and Assumption Agreement (Owner Participation Agreement) (this "Agreement") is made for reference purposes as of [ _], by and between LAB HOLDING, LLC, a California limited liability company ("Assignor"), and TRI Pointe Homes Holdings Inc., a Delaware corporation ("Assignee"). RECITALS This Agreement is entered into upon the basis of the following facts, understandings, and intentions of Assignor and Assignee. A. The City of Anaheim, a California municipal corporation, (the "City") and Assignor entered into that certain Owner Participation Agreement, dated as of J 1, 2021 (the "OPA"). All defined terms not specifically defined herein shall have the meanings ascribed to them in the OPA. B. Assignor intends to convey to Assignee Project Site No. 2. In conjunction with the conveyance of Project Site No. 2 to Assignee, Assignor desires to assign to Assignee Assignor's rights, duties and obligations under the OPA, and Assignee desires to accept and assume Assignor's rights, duties and obligations under the OPA from and after the Date of this Agreement. NOW, THEREFORE, in consideration of the promises and the mutual agreements and covenants set forth herein and intending to be legally bound hereby, Assignor and Assignee do hereby agree as follows: 1. Date of this Agreement. For purposes of this Agreement, the "Date of this Agreement" shall be the date on which the deed from Assignor to Assignee for Project Site No. 2 is recorded in the Official Records. 2. Assignment. From and after the Date of this Agreement, Assignor hereby assigns to Assignee all of Assignor's rights, title and interest in and to the OPA. E-1 4851-91734762v12/022363-0015 3. Assumption. From and after the Date of this Agreement, Assignee hereby assumes from Assignor all of Assignor's right, title and interest in and to the Assigned Interests, and agrees to perform all of Assignor's obligations as "Developer" under the OPA relating to the period from and after the Date of this Agreement. 4. General Provisions. (a) Severabilir, . If any term or provision of this Agreement or the application thereof to any person or circumstance is found by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each remaining term and provision of this Agreement shall be valid and enforceable to the full extent permitted by law; provided that, if the invalidation or unenforceability would deprive either Assignor or Assignee of material benefits derived from this Agreement or make performance under this Agreement unreasonably difficult, then Assignor and Assignee shall meet and confer and shall make good faith efforts to modify this Agreement in a manner that is acceptable to Assignor, Assignee and the City. (b) Successors and Assigns. This Agreement shall be binding upon and inure solely to the benefit of the parties hereto and their permitted successors and assigns. (c) Applicable Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California, applicable to contracts executed in and to be performed entirely within that state, and without regard to the conflicts of laws, or choice of law provisions thereof. (d) Countelp)arts. This Agreement may be executed in one (1) or more counterparts, each of which shall be deemed an original but all of which taken together shall constitute one and the same agreement. (e) Notices. All notices, invoices and other communications required or permitted under this Agreement shall be made in writing, and shall be delivered either personally (including by private courier), by certified mail, postage prepaid and return receipt requested, or by nationally recognized overnight courier service to the following addresses, or to such other addresses as the parties may designate in writing from time to time: To Assignee: TRI Pointe Homes Holdings, Inc. 5 Peters Canyon Road, Suite 100 Irvine, California 92606 Attention: Tom Grable With Copy To: TRI Pointe Homes Holdings, Inc. 5 Peters Canyon Road, Suite 100 Irvine, California 92606 Attention: Scott Pasternak E-2 4851-91734762v12/022363-0015 With Copy To: Goodwin Procter LLP 601 S. Figueroa Street, 41 st Floor Los Angeles, California 90017 Attention: Alex P. Jacobs, Esq. To Assignor: c/o The Lab 709 Randolph Avenue Costa Mesa, California 92626 Attention: Shaheen Sadeghi; Roman Ciuni With Copy To: Rutan & Tucker, LLP 611 Anton Boulevard, 14th Floor Costa Mesa, CA 92626 Attention: Peter Howell Notices personally delivered shall be deemed received upon delivery. Notices delivered by certified mail as provided above shall be deemed received on actual delivery. Notices delivered by courier service as provided above shall be deemed received one (1) business day after the date of deposit for overnight delivery. From and after the Date of this Agreement and until further written notice from Assignee to the City pursuant to the terms of the OPA, Assignee hereby designates as its notice address for notices sent by the City pursuant to Section 601 of the OPA, the notice address set forth above. (f) AttornqyL Fees. In the event of any legal or equitable proceeding in connection with this Agreement, the prevailing party in such proceeding shall be entitled to recover its reasonable costs and expenses, including without limitation reasonable attorneys' fees, costs and disbursements paid or incurred in good faith at the arbitration, pre-trial, trial and appellate levels, and in enforcing any award or judgment granted pursuant thereto. (g) No Waiver. No delay or omission by either party in exercising any right, remedy, election or option accruing upon the noncompliance or failure of performance by the other party under the provisions of this Agreement shall constitute an impairment or waiver of any such right, remedy, election or option. No alleged waiver shall be valid or effective unless it is set forth in a writing executed by the party against whom the waiver is claimed. A waiver by either party of any of the covenants, conditions or obligations to be performed by the other party shall not be construed as a waiver of any subsequent breach of the same or any other covenants, conditions or obligations. (h) No Joint Venture. Nothing contained herein shall be construed as creating a joint venture, agency, or any other relationship between the parties hereto other than that of assignor and assignee. (i) Time of the Essence. Time is of the essence in the performance by each party of its obligations under this Agreement. 0) Authoriv. Each person executing this Agreement represents and warrants that he or she has the authority to bind his or her respective party to the performance of its obligations hereunder and that all necessary board of directors', shareholders', partners', members', managers', and other approvals have been obtained. E-3 4851-91734762vl2/022363-0015 (k) Tri Pointe represents and warrants that it is a Delaware corporation and in good standing under the laws of the State of California and is authorized to carry on its business in California as such business is now conducted and to own and operate its properties and assets now owned and being operated by it, and as set forth in and anticipated by the OPA. Tri Pointe has full right, power and lawful authority to enter into this Agreement and the execution and delivery of this Agreement by Tri Pointe has been fully authorized by all requisite actions on the part of Tri Pointe. Tri Pointe has provided the City with true and correct copies of documentation reasonably acceptable to the City Manager designating the party authorized to execute this Agreement on behalf of Tri Pointe. The City, having approved this Agreement is authorized by Tri Pointe to rely on this representation. IN WITNESS WHEREOF, Assignor and Assignee have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized. ASSIGNOR: LAB HOLDING, LLC, a California limited liability company Bv: Name: Its: ASSIGNEE: TRI POINTE HOMES HOLDINGS INC., a Delaware corporation By: Name: _ Its: E-4 4851-91734762v 12/022363-0015 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA ) ) SS. COUNTY OF ) On before me, Notary Public, personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose names(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal SIGNATURE OF NOTARY PUBLIC E-5 4851-9173-4762v12/022363-0015 EXHIBIT F RELEASE OF CONSTRUCTION COVENANTS RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: Attention: CIT , California This document is exempt from the payment of a recording fee pursuant to Government Code Section 27383. RELEASE OF CONSTRUCTION COVENANTS This RELEASE OF CONSTRUCTION COVENANTS (the "Release") is made by the CITY ANAHEIM, a California municipal corporation and charter city (the "City"), in favor of a (the "Developer"), as of the date set forth below. RECITALS A. The City and the Developer have entered into that certain agreement entitled "Owner Participation Agreement" dated as of , 2021 (the "OPA") concerning the conveyance and development of certain real property situated in the City of Anaheim, California designated as "Phase _ of Project Site No. 2"; Phase _ Project Site No. 2 is that real property described in Attachment No. 1 hereto and incorporated herein by this reference. B. As referenced in Section 310 of the OPA, the City is required to furnish the Developer or its successors with a Release of Construction Covenants (as defined in Section 100 of the OPA) upon F-1 4851-9173-4762vl2/022363-0015 Completion of the Developer Improvements (as defined in Section 100 of the OPA), which Release is required to be in such form as to permit it to be recorded in the Recorder's office of Orange County as to Phase _ of Project Site No. 2. This Release is conclusive determination of satisfactory Completion of the Developer Improvements on Phase _ of Project Site No. 2. C. The City has conclusively determined that such construction and development of the Developer Improvements has been satisfactorily completed. NOW, THEREFORE, the City hereby certifies as follows: 1. The Developer Improvements as to Project Site No. 2 to be constructed by the Developer in accordance with Sections 300-306 of the OPA and the Scope of Development have been fully and satisfactorily completed. 2. Phase of Project Site No. 2 is hereby released from all provisions of the OPA excepting only the "Surviving Covenants," as defined in Section 100 of the OPA. 3. Nothing contained in this instrument shall modify in any other way any other provisions of the OPA. F-2 4851-9173-4762v12/022363-0015 IN WITNESS WHEREOF, the City has executed this Release this day of 120 CITY: CITY OF ANAHEIM, a California municipal corporation and charter city Dated: _ 120_ By - ATTEST: THERESA BASS CMC, CITY CLERK City Clerk APPROVED AS TO FORM: ROBERT FABELA, CITY ATTORNEY Leonie Mulvihill Assistant City Attorney City Manager DEVELOPER: LAB HOLDING LLC, a California limited liability company Dated: , 20_ By: Its: F-3 4851-9173-4762v12/022363-0015 ATTACHMENT NO. 1 LEGAL DESCRIPTION OF PHASE _ OF PROJECT SITE NO.2 Attachment No. 1 to Exhibit F 4851-91734762v12/022363-0015 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. I STATE OF CALIFORNIA I COUNTY OF I On , before me, ss. (Print Name of Notary Public) , Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. signature of Notary Public OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER ❑ Individual ❑ Corporate Officer Title(s) ❑ Partner(s) ❑ Limited ❑ General ❑ Attorney -In -Fact ❑ Trustee(s) ❑ Guardian/Conservator ❑ Other: Signer is representing: Name Of Person(s) Or Entity(ies) 4851-9173-4762vl2/022363-0015 DESCRIPTION OF ATTACHED DOCUMENT Title Or Type Of Document Number Of Pages Date Of Documents Other Than Named Above A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF On personally appeared , before me, ss. (Print Name of Notary Public) , Notary Public, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature o . otaryu is OPTIONAL Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form. CAPACITY CLAIMED BY SIGNER ❑ Individual ❑ Corporate Officer Title(s) ❑ Partner(s) ❑ Limited ❑ General ❑ Attorney -In -Fact ❑ Trustee(s) ❑ Guardian/Conservator ❑ Other: _ Signer is representing: Name Of Person(s) Or Entity(ies) 4851-9173-4762vl2/022363-0015 DESCRIPTION OF ATTACHED DOCUMENT Title Or Type Of Document Number Of Pages Date Of Documents s) Other Than Named Above EXHIBIT G MEMORANDUM OF AGREEMENT RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO AND SEND TAX STATEMENTS TO: City of Anaheim 200 South Anaheim Boulevard, Second Floor Anaheim, California 92805 Attention: City Manager This document is exempt from the payment of a recording fee pursuant to Government Code Section 27383. MEMORANDUM OF AGREEMENT This MEMORANDUM OF AGREEMENT (the "Agreement") is entered into as of 2021 by and between the CITY OF ANAHEIM, a California municipal corporation and charter city (the "City"), and LAB HOLDING, LLC, a California limited liability company (hereinafter referred to as "Developer"). This Memorandum of Agreement evidences that certain unrecorded Owner Participation Agreement between the City and the Developer dated , 2021 ("OPA"), a copy of which is on file with the City as a public record. Capitalized terms not defined herein shall have the meanings set forth in the OPA. When recorded at the Closing the OPA is a burden against Developer's fee simple interest in the Property which Property is more particularly described in Attachment No. 1 attached hereto and incorporated herein by reference. The OPA provides, among other things, for the development and operation by Developer thereon of the Developer Improvements in Phases. As set forth in Section 310 of the OPA, upon the City's issuance of the Release of Construction Covenants for each Phase, the parties' rights and obligations set forth in or arising out of the OPA with respect to such Phase shall automatically terminate with the exception of the Surviving Covenants and any party then owning or thereafter purchasing or otherwise acquiring any interest in such Phase shall not (because of such ownership, purchase, lease or acquisition) incur any obligation or liability under the OPA except for the Surviving Covenants. The Surviving Covenants shall run with the land and be binding upon the heirs, successors and assigns of Developer in accordance with the OPA. G-1 4851-9173-4762v12/022363-0015 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the respective dates set forth below. CITY: CITY OF ANAHEIM, a California municipal corporation and charter city Dated: , 20_ By: ATTEST: THERESA BASS CMC, CITY CLERK City Clerk APPROVED AS TO FORM: ROBERT FABELA, CITY ATTORNEY Leonie Mulvihill Assistant City Attorney City Manager DEVELOPER: LAB HOLDING LLC, a California limited liability company Dated: , 20_ By: Its: G-2 4851-91734762v12/022363-0015 EXHIBIT H DESIGN REVIEW PROCESS 1. Design Development Drawings. Within the time set forth in the Schedule of Performance, the Developer shall submit to City the following plans and drawings with respect to the Developer Improvements (the "Design Development Drawings"), which must include the following: (a) A fully dimensioned Site Plan which complies with the City's site plan submittal process for review by the City Planning Commission, which includes a landscape plan, with hardscape plans, sections and elevations, including lighting, equipment, furnishings and planting schedules. (b) Materials and color board. (c) Floor plans. (d) Roof plans. (e) Elevations and project sections. (f) Tabulation of areas/uses. (g) Elevations of major public spaces. (h) A traffic and circulation plan as applicable or as many be required by the City's Traffic Engineer. (i) A rendered perspective. 0) Graphics and signage plans. (k) Lighting schedules with samples or manufacturer's literature for exterior lighting and lighting on building exteriors. Lighting locations are to be shown on landscape plans and elevations. (1) Preliminary landscape plans. (m) Communal spaces. (n) Pedestrian and Vehicular Access. (o) Parking. (p) Trash/Trash enclosures. 2. Construction Drawings and Related Documents. After the City's approval of the Design Development Drawings and within the time set forth therefor in the Schedule of Performance, the Developer shall prepare or cause to be prepared and submit to the City H-1 4851-91734762v12/022363-0015 Manager detailed construction plans with respect to the Developer Improvements, including without limitation a grading plan, which shall have been prepared by a registered civil engineer (the "Construction Drawings"). 3. Standards for Disapproval. The City shall have the right to disapprove the Basic Concept Drawings in its sole discretion. The City shall have the right to disapprove in its reasonable discretion any of the Design Development Drawings if (a) the Design Development Drawings do not substantially reflect a logical iteration of the Basic Concept Drawings, or (b) the Design Development Drawings are incomplete in any material way. The City Manager shall have the right to disapprove in his reasonable discretion any of the Construction Drawings if (a) the Construction Drawings do not substantially reflect a logical iteration of the Design Development Drawings in any way, or (b) the Construction Drawings do not substantially conform to the Scope of Development, or (c) the Construction Drawings are incomplete in any way. The City's notice shall state in writing the specific reasons for disapproval and when such disapproval is given, and any disapproval must be in writing and given within thirty (30) days after request for approval is given by Developer. The Developer, upon receipt of any such a disapproval, shall revise such portions and resubmit the disapproved Basic Concept Drawings, Design Development Drawings, or Construction Drawings, as the case may be, disapproved thereby by the time established therefor in the Schedule of Performance. The Developer acknowledges and agrees in addition to the City land use regulatory authority that City is entitled to approve or disapprove the Basic Concept Drawings, Design Development Drawings and Construction Drawings in order to satisfy the City's obligation to promote the sound development and redevelopment of land within the Project, to promote a high level of design which will impact the surrounding development, and to provide an environment for the social, economic and psychological growth and well-being of the citizens of the City and the Project. 4. Consultation and _ Coordination. During the preparation of the Design Development Drawings and Construction Drawings, staff of the City and the Developer shall hold joint progress meetings with City staff to coordinate the preparation of, submission to, and review of the Basic Concept Drawings, Design Development Drawings and Construction Drawings by the City Manager and the City. The staff of the City and the Developer shall communicate and consult informally as frequently as is necessary to ensure that the formal submittal of any documents to the City can receive prompt and thorough consideration. Revisions. If the Developer desires to propose any substantial exterior revisions to the approved Basic Concept Drawings or Design Development Drawings, it shall submit such proposed changes to the City Manager, and shall also proceed in accordance with any and all state and local laws and regulations regarding such revisions, within the time frame set forth in the Schedule of Performance for the submittal of the Design Development Drawings. City shall expedite any response as necessary to avoid delay, subject to statutory notice requirements. Any change proposed in the approved Basic Concept Drawings may be disapproved by the City in its sole and absolute discretion. Any and all change orders or revisions required by the City and its inspectors which are required under the Municipal Code and all other applicable Uniform Codes (e.g. Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and regulations shall be included by the Developer in its Basic Concept Drawings, the Design Development Drawings, or the Construction Drawings and H-2 4851-91734762v12/022363-0015 completed during the construction of the Developer Improvements; City shall approve any and all such required changes. H-3 4851-91734762v12/022363-0015 EXHIBIT I AMENDED AND RESTATED PROMISSORY NOTE 2021 PRINCIPAL AMOUNT: $2,500,000.00 FOR VALUE RECEIVED, the undersigned, LAB HOLDING LLC, a California limited liability company ("Borrower"), whose address is 709 Randolph Avenue, Costa Mesa, California 92626, promises to pay to the order of THE CITY OF ANAHEIM, a California municipal corporation and charter city ("Lender"), at 200 South Anaheim Boulevard, Seventh Floor, Anaheim, California 92805, or at such other place as the Holder of this Note may from time to time designate in writing, in lawful money of the United States of America, the principal sum of Two Million Five Hundred and no/100 Dollars ($2,500,000.00), and so much as may be advanced from time to time, with interest at the rate, and with principal and interest due and payable, all as set forth below. This Promissory Note is sometimes referred to herein as this "Note", and the loan evidenced by this Note is sometimes referred to herein as the "Loan". The Lender and/or its transferees or assigns are sometimes referred to herein as the "Holder" of this Note. This Note is made pursuant to that certain Owner Participation Agreement by and between the Lender and the Borrower (as "City" and "Developer", respectively) dated as of 2021 (the "OPA"). The OPA is on file with the City as a public record. Capitalized terms not defined herein shall have the respective meanings set forth therefor in the OPA. 1.1 Maturity Date. The date when all sums due under this Note are due and payable is the "Maturity Date". The Maturity Date shall mean the earlier to occur of (i) August 31, 2022 or (ii) the date on which a Transfer to Tri Pointe is completed. 1.2 Rate of Interest. The principal balance outstanding from time to time shall bear interest from and after the date advanced at the annual rate, compounded quarterly of 6.67% per annum (the "Note Rate"). 1.3 Method of Computation of Interest. Interest for periods of one or more whole calendar months shall be calculated on the basis of one -twelfth (1/12) of one year's interest for each such month that principal is outstanding. Interest for a period of less than a whole calendar month shall be calculated on the basis of one -three hundred sixtieth (1/360) of one year's interest on the outstanding principal at the applicable rate times the number of days during such period that principal is outstanding. 1.4 Monthly Payments Prior to Maturity Date. On the first day of each calendar month commencing on the Date of this Agreement until the Maturity Date, there shall be due and payable a monthly payment in an amount equal to all accrued interest. Except as otherwise set forth herein or in the other Loan Documents, interest shall be paid in arrears. 1.5 Payment in Full upon Maturity Date. On the Maturity Date, the entire unpaid principal balance and all accrued interest shall be due and payable. I-1 4851-91734762v12/022363-0015 1.6 Prepayments. Borrower may prepay all or any part of the principal balance at any time without charge or premium; provided, however, that any partial prepayments of principal shall be made in even One Hundred Thousand Dollars ($100,000) increments. 1.7 Security. This Note is secured by, among other things, that certain Amended and Restated Deed of Trust With Absolute Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith (the "Deed of Trust"), encumbering Borrower's interest in real property described in the Deed of Trust and improvements located or to be located thereon, and certain personal property. This Note, the Deed of Trust, and all other present and future agreements, documents and instruments executed or to be executed in connection with the Loan, all extensions, renewals, substitutions, replacements and modifications of any of the foregoing documents are referred to herein, collectively, as the "Loan Documents." 1.8 Application of Payments. All payments received, irrespective of how they may be designated by Borrower, shall be applied in this order: first, to amounts other than interest and principal, if any, owing under this Note, the Deed of Trust or any of the other Loan Documents; second, to accrued interest; third, to principal; except that, after the occurrence and during the continuation of any Event of Default, all amounts received shall be applied in such order as Holder, in its sole discretion, may elect. Borrower waives the application of Sections 1479 and 2822(a) of the California Civil Code and any other statute or rule of law that would otherwise direct, or permit Borrower to direct, the order of application of payments made by Borrower or amounts otherwise received by Holder. 1.9 No Waiver by Acceptance of Overdue or Partial Payments. If Holder accepts payment of any overdue amount, or partial payment of an amount due and the remainder of such amount is unpaid, such acceptance shall in no event: (a) constitute a cure or waiver of Borrower's default with respect to such overdue or unpaid amount; (b) prevent Holder from exercising any of its rights and remedies with respect to Borrower's default; or (c) constitute a waiver of Holder's right to require full and timely payment of amounts becoming due thereafter or to exercise any of Holder's rights and remedies for any failure to so pay. 1.10 Late Payment Charge. Borrower acknowledges that late payment to Holder of any sums due hereunder will cause Holder to incur costs not contemplated hereunder, the exact amount of which would be impracticable or extremely difficult to ascertain. Such costs include processing and accounting costs, the expenses incurred and time and effort associated with recovering the delinquent payment, and the loss of timely use of the payment amount. Accordingly, if any amount due from Borrower, whether interest or principal, is not received by Holder or Holder's designee within ten (10) calendar days after its due date (except the payment due at the Maturity Date), Borrower shall then pay to Holder a late payment charge equal to ten percent (10.00%) of such overdue amount (the "Late Charge"). Borrower and Lender agree that such Late Charge represents a fair and reasonable estimate of the costs Holder will incur by reason of late payment. This provision shall not be construed as extending the time for payment of any amount under this Note, and acceptance of a Late Charge by Holder shall in no event constitute a waiver of Borrower's default with respect to the overdue amount nor prevent Holder from exercising any of its rights and remedies with respect to such default. 1.11 Default. The term "Default" shall mean one or more of (i) the occurrence of an Event of Default as defined in the Loan Documents or (ii) the occurrence of a Breach under the OPA which has not been cured within any applicable Cure Period. The existence of a Default shall be I-2 4851-91734762v12/022363-0015 deemed to be on the first date of the occurrence of an Event of Default (the "Date of Default"), and all rights and remedies of Lender, Beneficiary and Trustee under the Loan Documents with respect thereto, with or without notice, shall be retroactive to the Date of Default Events of Default include: (a) the failure of Borrower to make any payment of principal or interest on the Note when the same is due and payable, whether at maturity, by acceleration or otherwise; (b) the failure of Borrower to pay any other amount due hereunder or under the Note when the same is due and payable; (c) the sale or transfer of Project Site No. 2 described in the Deed of Trust, without the prior written consent of Lender unless such sale or transfer is otherwise authorized by express provision of the OPA; (d) the mortgage, assignment or further encumbrance of Project Site No. 2, whether directly or indirectly, whether voluntarily, involuntarily or by operation of law, without the prior written consent of Lender; (e) the failure of Borrower to perform any obligation in the Deed of Trust, and the continuance of such failure for thirty (30) after notice, or within any longer grace period, if any, allowed in the Deed of Trust for such failure; and (f) the commission by Borrower (as Developer) of any Breach under the OPA which has not been cured by the applicable Cure Period under the OPA. 1.12 Acceleration upon Default. Upon the occurrence of an Event of Default, Holder may, at its election, declare the entire balance of principal and accrued interest immediately due and payable. A delay by Holder in exercising any right of acceleration after an Event of Default shall not constitute a waiver of the Event of Default or of the right of acceleration or any other right or remedy for such Event of Default, including the imposition of the Default Rate (defined below) from the date of the Event of Default. The failure by Holder to exercise any right of acceleration as a result of an Event of Default shall not constitute a waiver of the right of acceleration or any other right or remedy with respect to any other Event of Default, whenever occurring. 1.13 Acceleration in Other Events. The entire balance of principal and interest is also subject to acceleration upon the occurrence of certain events, including certain transfers of Project Site No. 2, as provided in the Deed of Trust, and any transfer of Project Site No. 2 or any portion thereof which is not a "Permitted Transfer" under the DDA. 1.14 Interest Rate after Acceleration or Maturity. When this Note becomes due in full, whether by acceleration (upon an Event of Default or otherwise), by the occurrence of the Maturity Date, or in any other manner, if Borrower fails to pay all amounts due, the unpaid principal balance and costs incurred shall, from and after such date due and without notice, bear interest until paid at the rate of ten percent (10%) per annum (the "Default Rate"). 1.15 Enforcement Fees and Costs. Borrower shall immediately reimburse Holder for all fees and costs, including reasonable attorneys' fees and experts' fees and costs, incurred by Holder for: (a) enforcement of this Note or any of its terms, or the exercise of any rights or remedies hereunder and/or at law, in equity or otherwise, whether or not any action or proceeding is filed; (b) representation of Holder in any bankruptcy, insolvency, reorganization or other debtor -relief or similar proceeding of or relating to Borrower or Borrower's transferees or assigns, to any person liable (by way of guaranty, assumption, endorsement or otherwise) upon any of the obligations of this Note, or to Project Site No. 2; or (c) representation of Holder in any action or proceeding relating to Project Site No. 2, whether commenced by Holder or any other person, including foreclosure, receivership, lien or stop -notice enforcement, bankruptcy, eminent domain and probate actions or proceedings. All such fees and costs shall bear interest until paid at the rate applicable from time to time under this Note. I-3 4851-91734762v12/022363-0015 1.16 Waivers by Borrower and Other Parties. The Borrowers, endorsers, guarantors and sureties of this Note hereby waive diligence, demand, presentment, notice of non-payment, notice of dishonor, protest and notice of protest, agree that the time for performance of any obligation under this Note may be extended from time to time without notice, consent to the release without notice of any party liable hereon or herefor, consent to the addition without notice of parties liable hereon or herefor, and consent to the acceptance without notice of further security for this Note, including other types of security, all without in any way affecting their liability, and waive the right to plead any and all statutes of limitations as a defense to this Note, any guaranty hereof or any agreement to pay the obligations hereof, to the full extent permitted by law. 1.17 Full Payment. All amounts payable under this Note shall be paid in full without setoff, deduction or counterclaim. All amounts payable under this Note shall be free and clear of and without any deduction or withholding for or on account of any taxes, levies, duties, charges, fees, restrictions or conditions of any nature now or hereafter imposed by any country, federal, state, county or local government or any political subdivision or taxing authority thereof or therein. Borrower shall indemnify Holder against any such taxes, levies, imposts, duties, charges and fees (other than taxes on the income of Holder imposed by any taxing authority) which may be assessed against Holder or claimed or demanded from Holder in respect of any amount payable by Borrower hereunder, and against any costs, charges, expenses or liability arising out of or with respect to such assessment, claim or demand, to the full extent permitted by law. 1.18 Time of the Essence. Time is of the essence with respect to the payment and performance of the obligations under this Note. 1.19 No Oral Waivers or Modifications. No provision of this Note may be waived or modified orally, but only in a writing signed by Holder. 1.20 Governing Law. This Note shall be governed by and construed under the laws of the State of California, without regard to conflict of law provisions. 1.21 Severability. Every provision of this Note is intended to be several. If any provision of this Note is determined by a court of competent jurisdiction to be illegal, invalid or unenforceable, such illegality, invalidity or unenforceability shall not affect the other provisions hereof, which shall remain binding and enforceable. 1.22 Limitation upon Interest. All agreements between the Borrower and Holder, now existing or hereafter arising, are hereby expressly limited so that in no event whatsoever shall the amount paid or agreed to be paid to Holder hereof for the use, forbearance or detention of money to be loaned hereunder or otherwise, or for the performance or payment of any covenant or obligation contained herein, exceed the maximum amount permissible under applicable law. If from any circumstance whatsoever fulfillment of any provision hereof exceeds the limit of validity prescribed by law, then, ipso facto, the obligation to be fulfilled shall be reduced to the limit of such validity, and if from any such circumstance Holder hereof shall ever receive as interest under this Note or otherwise an amount that would exceed the highest lawful rate, such amount that would be excessive interest shall be applied to the reduction of the principal amount owing hereunder (without charge for prepayment) and not to the payment of interest, or if such excessive interest exceeds the unpaid balance of principal, such excess shall be refunded to Borrower. I-4 4851-9173-4762v12/022363-0015 1.23 Headings. Headings herein are used for convenience of reference only and do not define or limit the scope of provisions of this Note. 1.24 Successors and Assigns. This Note binds Borrower and its successors, permitted assigns, heirs, administrators and executors, and inures to the benefit of Holder and its successors, assigns, participants, heirs, administrators and executors. Holder in its sole discretion may transfer this Note, and may sell or assign participations or other interests in all or any part of this Note, all without notice to or consent of Borrower. Notwithstanding the foregoing portion of this Section 1.24, this Note is not assumable without the prior written approval of Holder, which Holder may grant, conditionally grant, or refuse at its sole and absolute discretion. 1.25 Counterparts. This Note may be executed in one or more counterparts, each of which shall be deemed an original. LAB HOLDING LLC, a California limited liability company Dated: , 20_ By: Its: I-5 4851-9173-4762v12/022363-0015 EXHIBIT J AMENDED AND RESTATED DEED OF TRUST WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING Recording Requested By: When Recorded Mail To: City of Anaheim 200 South Anaheim Boulevard, Seventh Floor Anaheim, California 92805 Attention: City Manager AMENDED AND RESTATED DEED OF TRUST WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (First Priority) THIS AMENDED AND RESTATED DEED OF TRUST WITH ABSOLUTE ASSIGNMENT OF LEASES AND RENTS, SECURITY AGREEMENT AND FIXTURE FILING (this "Deed of Trust"), made as of 2021, is entered into by and among: LAB HOLDING LLC, a California limited liability company ("Trustor"), whose address is 709 Randolph Avenue, Costa Mesa, California 92626, and First American Title Insurance company ("Trustee"), and The City of Anaheim, a California municipal corporation and charter city ("Beneficiary"), whose address is 200 South Anaheim Boulevard, Seventh Floor, Anaheim, California 92805, Attention: City Manager. Trustor irrevocably grants, conveys and assigns to Trustee, IN TRUST FOR THE BENEFIT OF BENEFICIARY, WITH POWER OF SALE AND RIGHT OF ENTRY AND POSSESSION, all of Trustor's right, title and interest, whether now owned or hereafter acquired, in and to that certain real property hereinafter described (the "Land"), together with, all buildings and other improvements and fixtures now or hereafter located thereon (the "Improvements"), all development rights, mineral and oil rights, appurtenances, easements and rights relating thereto, and all additions and accretions to, and the proceeds of, any of the foregoing (all of the foregoing being collectively referred to as the "Property"): SEE ATTACHMENT NO. 1 ATTACHED HERETO FOR LEGAL DESCRIPTION For the purpose of securing the payment of the indebtedness under a loan (the "Loan") from Beneficiary to Trustor evidenced by that certain Amended and Restated Promissory Note of even date herewith (the "Note") in the principal amount of Two Million Five Hundred and No/100 Dollars ($2,500,000.00), including future advances thereunder, if any, together with the payment of all other sums becoming due and payable to Beneficiary under the documents and instruments evidencing or securing the Loan (together with this Deed of Trust, the "Loan Documents"), and the performance of all covenants and obligations of Trustor under the Loan Documents, payment of all other obligations owed by Trustor to Beneficiary that by their terms recite that they are secured by this Deed of Trust, and all modifications, extensions and renewals of any of the obligations secured hereby, however evidenced (collectively the "Secured Obligations"). The term "obligations" is used herein in its broadest and most comprehensive sense and shall be deemed to include, without limitation, all principal, interest, prepayment charges 7-1 4851-91734762vl2/022363-0015 (if any), late charges, other charges, payments, and loan fees at any time accruing or assessed on any of the Secured Obligations. This Deed of Trust secures the repayment of the Amended and Restated Promissory Note and identified in that certain unrecorded agreement entitled "Owner Participation Agreement" dated as of . 2021 by and between Beneficiary and Trustor (collectively, the "OPA"). The OPA is on file with the City as a public record. Any capitalized terms not defined herein shall have the respective meanings set forth therefor in the OPA. All terms of the Secured Obligations and the documents evidencing such obligations are incorporated herein by this reference. Any and all persons or entities who may have or acquire an interest in all or any part of the Property shall be deemed to have notice of the terms of the Secured Obligations. ARTICLE 1. ASSIGNMENT OF LEASES AND RENTS 1.1 Assignment. Trustor hereby irrevocably assigns to Beneficiary all of Trustor's right, title and interest in, to and under: (a) all leases of the Property or any portion thereof, and all other agreements of any kind relating to the use or occupancy of the Property or any portion thereof, whether now existing or entered into after the date hereof ("Leases"); and (b) the rents, revenue, income, issues, deposits security deposits, letters of credit, lease bonds and other deposit substitutes or credit enhancements and profits of the Property, including, without limitation, all amounts payable and all rights and benefits accruing to Trustor under the Leases ("Payments"). The term "Leases" shall also include all guarantees of and security for the lessees' performance thereunder, and all amendments, extensions, renewals or modifications thereto which are permitted hereunder. This is a present and absolute assignment, not an assignment for security purposes only, and Beneficiary's right to the Leases and Payments is not contingent upon, and may be exercised without possession of, the Property. 1.2 Grant of License. Beneficiary confers upon Trustor a license ("License") to collect and retain the Payments as they become due and payable, until the occurrence of a Default (as hereinafter defined). Upon a Default, the License shall be automatically revoked and Beneficiary may collect and apply the Payments pursuant to Section 4.4 without notice and without taking possession of the Property. Trustor hereby irrevocably authorizes and directs the lessees under the Leases to rely upon and comply with any notice or demand by Beneficiary for the payment to Beneficiary of any rental or other sums which may at any time become due under the Leases, or for the performance of any of the lessees' undertakings under the Leases, and the lessees shall have no right or duty to inquire as to whether any Default has actually occurred or is then existing hereunder. Trustor hereby relieves the lessees from any liability to Trustor by reason of relying upon and complying with any such notice or demand by Beneficiary. 1.3 Effect of Assiznment. The foregoing irrevocable assignment shall not cause Beneficiary to be: (a) a mortgagee in possession; (b) responsible or liable for performing any of the terms, agreements, undertakings, obligations, representations, warranties, covenants and conditions of the Leases; or (c) responsible or liable for any waste committed on the Property by the lessees under any of the Leases or any other parties; for any dangerous or defective condition of the Property; or for any negligence in the management, upkeep, repair or control of the Property. Beneficiary shall not be liable to Trustor or any other person as a consequence of: (i) the exercise or failure to exercise by Beneficiary any of the rights, remedies or powers granted to Beneficiary hereunder; or (ii) the failure of Beneficiary to perform or discharge any obligation, duty or liability of Trustor arising under the Leases. 1.4 Representations and Warranties. Trustor represents and warrants that: (a) there are no Leases at the Property other than those set forth in writing and delivered to Beneficiary; (b) all existing Leases are in full force and effect and are enforceable in accordance with their respective terms, and no breach or default, or event which would constitute a breach or default after notice or the passage of time, or both, exists under any existing Leases on the part of any party; (c) no rent or other payment under any existing Lease has been paid by any lessee for more than one (1) month in advance; and (d) none of the lessor's interests under any of the Leases has been transferred or assigned. 1.5 Leasing Covenants. Trustor covenants and agrees at Trustor's sole cost and expense to: (a) perform the obligations of lessor contained in the Leases and enforce by all available remedies performance by the lessees of the obligations of the lessees contained in the Leases; (b) give Beneficiary prompt written notice of any default which occurs with respect to any of the Leases, whether the default be that of the lessee or of the lessor; J-2 4851-91734762vl2/022363-0015 (c) exercise Trustor's best efforts to keep all portions of the Property that are capable of being leased at all times at rentals not less than the fair market rental value; (d) deliver to Beneficiary fully executed, counterpart original(s) of each and every Lease if requested to do so; and (e) execute and record such additional assignments of any Lease or specific subordinations (or subordination, attornment and non -disturbance agreements executed by the lessor and lessee) of any Lease to the Deed of Trust, in form and substance acceptable to Beneficiary, as Beneficiary may request. Trustor shall not, without Beneficiary's prior written consent: (i) enter into any Leases after the date hereof; (ii) execute any other assignment relating to any of the Leases; (iii) discount any rent or other sums due under the Leases or collect the same in advance, other than to collect rentals one (1) month in advance of the time when it becomes due; (iv) terminate, modify or amend any of the terms of the Leases or in any manner release or discharge the lessees from any obligations thereunder; (v) consent to any assignment or subletting by any lessee. Any such attempted action in violation of the provisions of this Section 1.5 shall be null and void. Without in any way limiting the requirement of Beneficiary's consent hereunder, any sums received by Trustor in consideration of any termination (or the release or discharge of any lessee) modification or amendment of any Lease shall be applied to reduce the outstanding Secured Obligations and any such sums received by Trustor shall be held in trust by Trustor for such purpose. 1.6 Estoppel Certificates. Within thirty (30) days after written request by Beneficiary, Trustor shall deliver to Beneficiary and to any party designated by Beneficiary estoppel certificates executed by Trustor and by each of the lessees, in recordable form, certifying (if such be the case): (a) that the foregoing assignment and the Leases are in full force and effect; (b) the date of each lessee's most recent payment of rent; (c) that there are no defenses or offsets outstanding, or stating those claimed by Trustor or lessees under the foregoing assignment or the Leases, as the case may be; and (d) any other information reasonably requested by Beneficiary. ARTICLE 2. SECURITY AGREEMENT AND FIXTURE FILING 2.1 Securin Interest. Trustor hereby grants and assigns to Beneficiary a security interest, to secure payment and performance of all of the Secured Obligations, in all of the following described personal property in which Trustor now or at any time hereafter has any interest (collectively, the "Collateral"): All goods, building and other materials, supplies, inventory, work in process, equipment, machinery, fixtures, furniture, furnishings, signs and other personal property and embedded software included therein and supporting information, wherever situated, which are or are to be incorporated into, used in connection with, or appropriated for use on the Land and the Improvements; together with all rents and security deposits derived from Land and Improvements; all inventory, accounts, cash receipts, deposit accounts, accounts receivable, contract rights, licenses, agreements, general intangibles, payment intangibles, software, chattel paper (whether electronic or tangible), instruments, documents, promissory notes, drafts, letters of credit, letter of credit rights, supporting obligations, insurance policies, insurance and condemnation awards and proceeds, proceeds of the sale of promissory notes, any other rights to the payment of money, trade names, trademarks and service marks arising from or related to the ownership, management, leasing, operation, sale or disposition of the Land and the Improvements or any business now or hereafter conducted thereon by Trustor; all development rights and credits, and any and all permits, consents, approvals, licenses, authorizations and other rights granted by, given by or obtained from, any governmental entity with respect to the Land and the Improvements, or any of their affiliates; all warrants, stock options or similar rights owned by Trustor in and to any Tenant, any licensee or any other Person providing services related to or for the benefit of the Land and the Improvements, or any of their affiliates; all water and water rights, wells and well rights, canals and canal rights, ditches and ditch rights, springs and spring rights, and reservoirs and reservoir rights appurtenant to or associated with the Land and the Improvements, whether decreed or undecreed, tributary, non -tributary or not non - tributary, surface or underground or appropriated or unappropriated, and all shares of stock in water, ditch, lateral and canal companies, well permits and all other evidences of any of such rights; all deposits or other security now or hereafter made with or given to utility companies by Trustor with respect to the Land and the Improvements; all advance payments of insurance premiums made by Trustor with respect to the Land and the Improvements; all plans, drawings and specifications relating to the Land and the Improvements; all loan funds held by Beneficiary, whether or not disbursed; all funds deposited with Beneficiary pursuant to any loan agreement; all J-3 4851-91734762vl2/022363-0015 reserves, deferred payments, deposits, security deposits, letters of credit, lease bonds and other deposit substitutes, credit enhancements, other like items, accounts, refunds, cost savings and payments of any kind related to the Land and the Improvements or any portion thereof, together with all replacements and proceeds of, and additions and accessions to, any of the foregoing; together with all books, records and files relating to any of the foregoing. As to all of the above described personal property which is or which hereafter becomes a "fixture" under applicable law, this Deed of Trust constitutes a fixture filing under the California Uniform Commercial Code, as amended or recodified from time to time ("UCC"). 2.2 Representations and Warranties. Trustor represents and warrants that: (a) Trustor has, or will have, good title to the Collateral; (b) Trustor has not previously assigned or encumbered the Collateral, and no financing statement covering any of the Collateral has been delivered to any other person or entity; (c) Trustor's principal place of business is located at the address shown in the heading of this Deed of Trust; and (d) Trustor's legal name is exactly as set forth on the first page of this Deed of Trust and all of Trustor's organizational documents or agreements delivered to Beneficiary are complete and accurate in every respect. 2.3 Covenants. Trustor agrees: (a) to execute and deliver such documents as Beneficiary deems necessary to create, perfect and continue the security interests contemplated hereby; (b) not to change its name, and as applicable, its chief executive office, its principal residence or the jurisdiction in which it is organized and/or registered without giving Beneficiary prior written notice thereof; (c) to cooperate with Beneficiary in perfecting all security interests granted herein and in obtaining such agreements from third parties as Beneficiary deems necessary, proper or convenient in connection with the preservation, perfection or enforcement of any of its rights hereunder; and (d) that Beneficiary is authorized to file financing statements in the name of Trustor to perfect Beneficiary's security interest in Collateral. 2.4 Remedies. This Deed of Trust constitutes a security agreement with respect to the Collateral in which Beneficiary is granted a security interest. Beneficiary has all of the rights and remedies of a secured party under the California Uniform Commercial Code as well as all other rights and remedies available at law or in equity. Trustor agrees to execute and deliver on demand, and irrevocably constitutes and appoints Beneficiary the attorney - in -fact of Trustor to execute, deliver, and file, any security agreements, financing statements, continuation statements, or other instruments that Beneficiary may request to impose, perfect or continue the perfection of the lien or security interest created by this Deed of Trust. Upon the occurrence of a Default (as hereinafter defined), Beneficiary will have the right to sell at any public or private sales as permitted by applicable law any of the Collateral that is personal property. Beneficiary will also have any other rights and remedies, whether at law, in equity, or by statute that are available to secured creditors. Any disposition may be conducted by an employee or agent of Beneficiary or Trustee. Any person or entity, including both Trustor and Beneficiary, will be eligible to purchase any part or all of the Collateral at any disposition. 2.5 Expenses. Expenses of retaking, holding and preparing for sale, selling, or the like will be borne by Trustor and will include Beneficiary's and Trustee's attorneys' fees and legal expenses. Trustor, on demand, will assemble the Collateral and make it available to Beneficiary at the Property, a place deemed to be reasonably convenient to Beneficiary and Trustor. Beneficiary will give Trustor at least ten (10) days' prior written notice of the time and place of any public sale or other disposition of the Collateral or of the time of or after which any private sale or any other intended disposition is to be made. If the notice is sent to Trustor in the manner provided for the mailing of notices in this Deed of Trust, it is deemed reasonable notice to Trustor. ARTICLE 3. RIGHTS AND DUTIES OF THE PARTIES 3.1 Title. Trustor represents and warrants that, except as disclosed to Beneficiary in a writing which refers to this warranty, Trustor lawfully holds and possesses fee simple title to the Property without limitation on the right to encumber, and that this Deed of Trust is a first and prior lien on the Property. 3.2 Taxes and Assessments. Subject to Trustor's rights to contest payment of taxes, Trustor shall pay prior to delinquency all taxes, assessments, levies and charges imposed by any public or quasi -public authority or utility company which are or which may become a lien upon or cause a loss in value of the Property or any interest J-4 4851-9173-4762v12/022363-0015 therein (the "Impositions"). Trustor shall also pay prior to delinquency all Impositions imposed by reason of its interest in any Secured Obligation or in the Property, or by reason of any payment made to Beneficiary pursuant to any Secured Obligation; provided, however, Trustor shall have no obligation to pay taxes which may be imposed from time to time upon Beneficiary and which are measured by and imposed upon Beneficiary's net income. 3.3 Performance of Secured Obli+gations. Trustor shall promptly pay and perform each Secured Obligation when due. 3.4 Liens, Encumbrances and Charge . Trustor shall immediately discharge any lien not approved by Beneficiary in writing that has or may attain priority over this Deed of Trust. Trustor shall pay when due all obligations secured by or which may become liens and encumbrances which shall now or hereafter encumber or appear to encumber all or any part of the Property or Collateral, or any interest therein, whether senior or subordinate hereto. 3.5 Damay_es, Insurance and Condemnation Proceeds. The following (whether now existing or hereafter arising) are all absolutely and irrevocably assigned by Trustor to Beneficiary and, at the request of Beneficiary, shall be paid directly to Beneficiary: (i) all awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any part of, or any interest in, the Property or Collateral; (ii) all other claims and awards for damages to, or decrease in value of, all or any part of, or any interest in, the Property or Collateral; (iii) all proceeds of any insurance policies (whether or not expressly required by Beneficiary to be maintained by Trustor, including, but not limited to, earthquake insurance and terrorism insurance, if any) payable by reason of loss sustained to all or any part of the Property or Collateral; and (iv) all interest which may accrue on any of the foregoing. Subject to applicable law, Beneficiary may at its discretion apply all or any of the proceeds it receives to its expenses in settling, prosecuting or defending any claim and may apply the balance to the Secured Obligations in such order and amounts as Beneficiary in its sole discretion may choose, and/or Beneficiary may release all or any part of the proceeds to Trustor upon any conditions Beneficiary may impose. Beneficiary may commence, appear in, defend or prosecute any assigned claim or action and may adjust, compromise, settle and collect all claims and awards assigned to Beneficiary. At its sole option, Beneficiary may permit insurance or condemnation proceeds held by Beneficiary to be used for repair or restoration but may condition such application upon reasonable conditions. 3.6 Maintenance and Preservation of the Pro mm . Trustor covenants: (a) to insure the Property and Collateral against such risks as Beneficiary may require and, at Beneficiary's request, to provide evidence of such insurance to Beneficiary, and to comply with the requirements of any insurance companies providing such insurance; (b) to keep the Property and Collateral in good condition and repair; (c) not to remove or demolish the Property or Collateral or any part thereof, not to alter, restore or add to the Property or Collateral and not to initiate or acquiesce in any change in any zoning or other land classification which affects the Property without Beneficiary's prior written consent; (d) to complete or restore promptly and in good and workmanlike manner the Property and Collateral, or any part thereof which may be damaged or destroyed to the extent of any insurance proceeds actually received therefor; (e) subject to Trustor's right to reasonably contest same, to comply with all laws, ordinances, regulations and standards, and all covenants, conditions, restrictions and equitable servitudes of every kind and character which affect the Property or Collateral and pertain to acts committed or conditions existing thereon; (f) not to commit or permit waste of the Property or Collateral; and (g) to do all other acts which from the character or use of the Property or Collateral may be reasonably necessary to maintain and preserve its value. 3.7 Defense and Notice of Losses Claims and Actions. At Trustor's sole expense, Trustor shall protect, preserve and defend the Property and Collateral and title to and right of possession of the Property and Collateral, the security hereof and the rights and powers of Beneficiary and Trustee hereunder against all adverse claims. Trustor shall give Beneficiary and Trustee prompt notice in writing of the assertion of any claim, of the filing of any action or proceeding, of the occurrence of any damage to the Property or Collateral and of any condem- nation offer or action. 3.8 Acceptance of Trust: Powers and Duties of Trustee. (a) Trustee accepts this trust when this Deed of Trust is recorded. From time to time on written request of Beneficiary and presentation of this Deed of Trust for endorsement, and without affecting the J-5 4851-9173-4762v12/022363-0015 personal liability of any person for payment of any indebtedness or the performance of any obligations, Trustee may, without liability and without notice: (i) reconvey all or any part of the Property, (ii) consent to the making of any map or plat; and (iii) join in any grant of easement, any declaration of covenants, conditions, and restrictions, any extension agreement, or any agreement subordinating the lien or charge of this Deed of Trust. (b) With the approval of Beneficiary, Trustee shall have the right to take any and all lawful action as Beneficiary may instruct Trustee to take to protect or enforce Beneficiary's rights hereunder. Trustee shall not be personally liable in case of entry by Trustee, or anyone entering by virtue of the powers herein granted to Trustee, upon the Property for debts contracted for or liability or damages incurred in the management or operation of the Property. (c) All moneys received by Trustee shall, until used or applied as herein provided, be held in trust for the purposes for which they were received, but need not be segregated in any manner from any other moneys (except to the extent required by applicable law) and Trustee shall be under no liability for interest on any moneys received by Trustee hereunder. (d) Should any deed, conveyance, or instrument of any nature be required from Trustor by any Trustee or substitute Trustee to more fully and certainly vest in and confirm to the Trustee or substitute Trustee such estates, rights, powers, and duties, then, upon request by the Trustee or substitute Trustee, any and all such deeds, conveyances and instruments shall be made, executed, acknowledged, and delivered and shall be caused to be recorded and/or filed by Trustor. 3.9 Compensation -,Exculpation- Indemnification. (a) Trustor shall pay Trustee's fees and reimburse Trustee for expenses in the administration of this trust, including attorneys' fees. Trustor shall pay to Beneficiary reasonable compensation for services rendered concerning this Deed of Trust, including without limit any statement of amounts owing under any Secured Obligation. Beneficiary shall not directly or indirectly be liable to Trustor or any other person as a consequence of (i) the exercise of the rights, remedies or powers granted to Beneficiary in this Deed of Trust; (ii) the failure or refusal of Beneficiary to perform or discharge any obligation or liability of Trustor under any agreement related to the Property or Collateral or under this Deed of Trust; or (iii) any loss sustained by Trustor or any third party resulting from Beneficiary's failure (whether by malfeasance, nonfeasance or refusal to act) to lease the Property after a Default (hereinafter defined) or from any other act or omission (regardless of whether same constitutes negligence) of Beneficiary in managing the Property after a Default unless the loss is caused by the willful misconduct of Beneficiary and no such liability shall be asserted against or imposed upon Beneficiary, and all such liability is hereby expressly waived and released by Trustor. (b) Trustor indemnifies and holds harmless Trustee and Beneficiary from and against all losses, damages, liabilities, claims, causes of action, judgments, court costs, attorneys' fees and other legal expenses, cost of evidence of title and value, and other expenses which either may suffer or incur: (i) by reason of this Deed of Trust, (ii) by reason of the execution of this Deed of Trust or in performance of any act required or permitted hereunder or by law, (iii) as a result of any failure of Trustor to perform Trustor's obligations, or (iv) by reason of any alleged obligation or undertaking on Beneficiary's part to perform or discharge any of the representations, warranties, conditions, covenants or other obligations contained in any other document related to the Property. The above obligations of Trustor to indemnify and hold harmless Beneficiary and Trustee shall survive the release and cancellation of the Secured Obligations and the release and reconveyance or partial release and reconveyance of this Deed of Trust. (c) Trustor shall pay all amounts and indebtedness arising under this Section 3.9 immediately upon demand by Trustee or Beneficiary together with interest thereon from the date the indebtedness arises at the rate of interest then applicable to the principal balance of the Note as specified therein. 3.10 Substitution of Trustee. From time to time, by a writing, signed and acknowledged by Beneficiary and recorded in the Office of the Recorder of the County in which the Property is situated, Beneficiary may appoint another trustee to act in the place and stead of Trustee or any successor. Such writing shall set forth any information required by law. The recordation of such instrument of substitution shall discharge Trustee herein J-6 4851-9173-4762v12/022363-0015 named and shall appoint the new trustee as the trustee hereunder with the same effect as if originally named Trustee herein. A writing recorded pursuant to the provisions of this Section 3.10 shall be conclusive proof of the proper substitution of such new Trustee. 3.11 Due on Sale or Encumbrance. If the Property or any interest therein shall be sold, transferred, mortgaged, assigned or further encumbered, whether directly or indirectly, whether voluntarily, involuntarily or by operation of law, without the prior written consent of Beneficiary, THEN Beneficiary, in its sole discretion, may declare all Secured Obligations immediately due and payable. 3.12 Releases. Extensions, Modifications and Additional Securin . Without notice to or the consent, approval or agreement of any persons or entities having any interest at any time in the Property and Collateral or in any manner obligated under the Secured Obligations ("Interested Parties"), Beneficiary may, from time to time, release any person or entity from liability for the payment or performance of any Secured Obligation, take any action or make any agreement extending the maturity or otherwise altering the terms or increasing the amount of any Secured Obligation, or accept additional security or release all or a portion of the Property and Collateral and other security for the Secured Obligations. None of the foregoing actions shall release or reduce the personal liability of any of said Interested Parties, or release or impair the priority of the lien of and security interests created by this Deed of Trust upon the Property and Collateral. 3.13 Reconry%ance. Upon Beneficiary's written request, and upon surrender to Trustee for cancellation of this Deed of Trust or a certified copy thereof and any note, instrument, or instruments setting forth all obligations secured hereby, Trustee shall reconvey, without warranty, the Property or that portion thereof then held hereunder. To the extent permitted by law, the reconveyance may describe the grantee as "the person or persons legally entitled thereto" and the recitals of any matters or facts in any reconveyance executed hereunder shall be conclusive proof of the truthfulness thereof. Neither Beneficiary nor Trustee shall have any duty to determine the rights of persons claiming to be rightful grantees of any reconveyance. When the Property has been fully reconveyed, the last such reconveyance shall operate as a reassignment of all future rents, issues and profits of the Property to the person or persons legally entitled thereto. 3.14 Subrop-ation. Beneficiary shall be subrogated to the lien of all encumbrances, whether released of record or not, paid in whole or in part by Beneficiary pursuant to the Loan Documents or by the proceeds of any loan secured by this Deed of Trust. 3.15 Hazardous Materials. (a) Hazardous Materials Covenants. Trustor agrees as follows: (i) No Hazardous Activities. Trustor shall not cause or permit the Property to be used as a site for the use, generation, manufacture, storage, treatment, release, discharge, disposal, transportation or presence of any Hazardous Materials, which for purposes of this Deed of Trust shall mean any oil, flammable explosives, asbestos, urea formaldehyde insulation, radioactive materials, hazardous wastes, toxic or contaminated substances or similar materials, including, without limitation, any substances which are "hazardous substances," "hazardous wastes," "hazardous materials," "toxic substances," "wastes," "regulated substances," "industrial solid wastes," or "pollutants" under the Hazardous Materials Laws, as described below, and/or other applicable environmental laws, ordinances and regulations. "Hazardous Materials" shall not include commercially reasonable amounts of such materials used in the ordinary course of operation of the Property which are used and stored in accordance with all applicable environmental laws, ordinances and regulations. (ii) Compliance. Trustor shall comply and cause the Property to comply with all "Hazardous Materials Laws" which for purposes of this Deed of Trust shall include, without limitation: the Clean Air Act, as amended, 42 U.S.C. Section 7401 et sec.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et se .; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et seg.; the Comprehensive Environment Response, Compensation and Liability Act of 1980, as amended (including the Superfund Amendments and Reauthorization Act of 1986, "CERCLA"), 42 U.S.C. Section 9601 et sect.; the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601 et se .; the Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651, the Emergency Planning and Community Right -to -Know Act of J-7 4851-9173-4762v12/022363-0015 1986, 42 U.S.C. Section 11001 et seq.; the Mine Safety and Health Act of 1977, as amended, 30 U.S.C. Section 801 et sue.; the Safe Drinking Water Act, as amended, 42 U.S.C. Section 300f et seq.; and all comparable state and local laws, laws of other jurisdictions or orders and regulations. (iii) Notices. Trustor shall immediately notify Beneficiary in writing of: (i) the discovery of any Hazardous Materials on, under or about the Property; (ii) any knowledge by Trustor that the Property does not comply with any Hazardous Materials Laws; (iii) any Hazardous Materials Claims, which for purposes of this Deed of Trust shall mean any pending or threatened claims against Trustor or the Property by any governmental entity or agency or by any other person or entity relating to Hazardous Materials or pursuant to the Hazardous Materials Laws; and (iv) the discovery of any occurrence or condition on any real property adjoining or in the vicinity of the Property that could cause the Property or any part thereof to be designated as Border Zone Property. (iv) Remedial Action. In response to the presence of any Hazardous Materials on, under or about the Property, Trustor shall immediately take, at Trustor's sole expense, all remedial action required by any Hazardous Materials Laws or any judgment, consent decree, settlement or compromise in respect to any Hazardous Materials Claims. (b) Hazardous Materials Indemnit % . Trustor hereby agrees to defend, indemnify and hold harmless Beneficiary, its directors, officers, employees, agents, successors and assigns from and against any and all losses, damages, liabilities, claims, actions, judgments, court costs and legal or other expenses (including without limitation, attorneys' fees and expenses) which Beneficiary may incur as a direct or indirect consequence of the use, generation, manufacture, storage, disposal, threatened disposal, transportation or presence of Hazardous Materials in, on, under or about the Property. Trustor shall immediately pay to Beneficiary upon demand any amounts owing under this Indemnity, together with interest thereon at the rate provided in the Loan Documents. Trustor's duty and obligation to defend, indemnify and hold harmless Beneficiary shall survive the release, reconveyance or partial reconveyance of the Deed of Trust. (c) Le=weal Effect of Section. Trustor and Beneficiary agree that: (a) this Article 3 is intended as Beneficiary's written request for information (and Trustor's response) concerning the environmental condition of the real property security as required by California Code of Civil Procedure §726.5; and (b) each provision in this Article (together with any indemnity applicable to a breach of any such provision) with respect to the environmental condition of the real property security is intended by Beneficiary and Trustor to be an "environmental provision" for purposes of California Code of Civil Procedure §736, and as such it is expressly understood that Trustor's duty to indemnify Beneficiary hereunder shall survive: (a) any judicial or non judicial foreclosure under the Deed of Trust, or transfer of the Property in lieu thereof, (b) the release and reconveyance or cancellation of the Deed of Trust; and (c) the satisfaction of all of Trustor's obligation under the Loan Documents. 3.16 Right of Inspection. Beneficiary, its agents and employees, may enter the Property at any reasonable time for the purpose of inspecting the Property and Collateral and ascertaining Trustor's compliance with the terms hereof, including the presence of Hazardous Materials. ARTICLE 4. DEFAULT PROVISIONS 4.1 Default. For all purposes hereof, the term "Default" shall mean (a) at Beneficiary's option, the failure of Trustor to make any payment of principal or interest on the Note or to pay any other amount due hereunder or under the Note when the same is due and payable, whether at maturity, by acceleration or otherwise; (b) the failure of Trustor to perform any non -monetary obligation hereunder, or the failure to be true of any representation or warranty of Trustor contained herein and the continuance of such failure for thirty (30) days after notice, or within any longer grace period, if any, allowed in the Deed of Trust for such failure, or (c) the existence of any Default as defined in the Loan Documents. 4.2 Rights and Remedies. At any time after Default, Beneficiary and Trustee shall each have all the following rights and remedies: J-8 4851-9173-4762vl2/022363-0015 (a) With or without notice, to declare all Secured Obligations immediately due and payable; (b) With or without notice, and without releasing Trustor from any Secured Obligation, and without becoming a mortgagee in possession, to cure any breach or Default of Trustor and, in connection therewith, to enter upon the Property and do such acts and things as Beneficiary or Trustee deem necessary or desirable to protect the security hereof, including, without limitation: (i) to appear in and defend any action or proceeding purporting to affect the security of this Deed of Trust or the rights or powers of Beneficiary or Trustee under this Deed of Trust; (ii) to pay, purchase, contest or compromise any encumbrance, charge, lien or claim of lien which, in the sole judgment of either Beneficiary or Trustee, is or may be senior in priority to this Deed of Trust, the judgment of Beneficiary or Trustee being conclusive as between the parties hereto; (iii) to obtain insurance; (iv) to pay any premiums or charges with respect to insurance required to be carried under this Deed of Trust; or (v) to employ counsel, accountants, contractors and other appropriate persons. (c) To commence and maintain an action or actions in any court of competent jurisdiction to foreclose this instrument as a mortgage or to obtain specific enforcement of the covenants of Trustor hereunder, and Trustor agrees that such covenants shall be specifically enforceable by injunction or any other appropriate equitable remedy and that for the purposes of any suit brought under this subparagraph, Trustor waives the defense of lathes and any applicable statute of limitations; (d) To apply to a court of competent jurisdiction for and obtain appointment of a receiver of the Property as a matter of strict right and without regard to the adequacy of the security for the repayment of the Secured Obligations, the existence of a declaration that the Secured Obligations are immediately due and payable, or the filing of a notice of default, and Trustor hereby consents to such appointment; (e) To enter upon, possess, manage and operate the Property or any part thereof, to take and possess all documents, books, records, papers and accounts of Trustor or the then owner of the Property, to make, terminate, enforce or modify Leases of the Property upon such terms and conditions as Beneficiary deems proper, to make repairs, alterations and improvements to the Property as necessary, in Trustee's or Beneficiary's sole judgment, to protect or enhance the security hereof; (f) To execute a written notice of such Default and of its election to cause the Property to be sold to satisfy the Secured Obligations. As a condition precedent to any such sale, Trustee shall give and record such notice as the law then requires. When the minimum period of time required by law after such notice has elapsed, Trustee, without notice to or demand upon Trustor except as required by law, shall sell the Property at the time and place of sale fixed by it in the notice of sale, at one or several sales, either as a whole or in separate parcels and in such manner and order, all as Beneficiary in its sole discretion may determine, at public auction to the highest bidder for cash, in lawful money of the United States, payable at time of sale. Neither Trustor nor any other person or entity other than Beneficiary shall have the right to direct the order in which the Property is sold. Subject to requirements and limits imposed by law, Trustee may from time to time postpone sale of all or any portion of the Property by public announcement at such time and place of sale. Trustee shall deliver to the purchaser at such sale a deed conveying the Property or portion thereof so sold, but without any covenant or warranty, express or implied. The recitals in the deed of any matters or facts shall be conclusive proof of the truthfulness thereof Any person, including Trustee, Trustor or Beneficiary may purchase at the sale; (g) To resort to and realize upon the security hereunder and any other security now or later held by Beneficiary concurrently or successively and in one or several consolidated or independent judicial actions or lawfully taken non judicial proceedings, or both, and to apply the proceeds received upon the Secured Obliga- tions all in such order and manner as Trustee and Beneficiary, or either of them, determine in their sole discretion. (h) Upon sale of the Property at any judicial or non judicial foreclosure, Beneficiary may credit bid (as determined by Beneficiary in its sole and absolute discretion) all or any portion of the Secured Obligations. In determining such credit bid, Beneficiary may, but is not obligated to, take into account all or any of the following: (i) appraisals of the Property as such appraisals may be discounted or adjusted by Beneficiary in its sole and absolute underwriting discretion; (ii) expenses and costs incurred by Beneficiary with respect to the Property prior to foreclosure; (iii) expenses and costs which Beneficiary anticipates will be incurred with respect to the Property after foreclosure, but prior to resale, including, without limitation, costs of structural reports and other J-9 4851-9173-4762v12/022363-0015 due diligence, costs to carry the Property prior to resale, costs of resale (e.g. commissions, attorneys' fees, and taxes), costs of any hazardous materials clean-up and monitoring, costs of deferred maintenance, repair, refurbishment and retrofit, costs of defending or settling litigation affecting the Property, and lost opportunity costs (if any), including the time value of money during any anticipated holding period by Beneficiary; (iv) declining trends in real property values generally and with respect to properties similar to the Property; (v) anticipated discounts upon resale of the Property as a distressed or foreclosed property; (vi) the fact of additional collateral (if any), for the Secured Obligations; and (vii) such other factors or matters that Beneficiary (in its sole and absolute discretion) deems appropriate. In regard to the above, Trustor acknowledges and agrees that: (w) Beneficiary is not required to use any or all of the foregoing factors to determine the amount of its credit bid; (x) this Section does not impose upon Beneficiary any additional obligations that are not imposed by law at the time the credit bid is made; (y) the amount of Beneficiary's credit bid need not have any relation to any loan -to -value ratios specified in the Loan Documents or previously discussed between Trustor and Beneficiary; and (z) Beneficiary's credit bid may be (at Beneficiary's sole and absolute discretion) higher or lower than any appraised value of the Property. 4.3 Application of Foreclosure Sale Proceeds. After deducting all costs, fees and expenses of Trustee, and of this trust, including, without limitation, cost of evidence of title and attorneys' fees in connection with sale and costs and expenses of sale and of any judicial proceeding wherein such sale may be made, Trustee shall apply all proceeds of any foreclosure sale: (a) to payment of all sums expended by Beneficiary under the terms hereof and not then repaid, with accrued interest at the rate of interest specified in the Note to be applicable on or after maturity or acceleration of the Note; (b) to payment of all other Secured Obligations; and (c) the remainder, if any, to the person or persons legally entitled thereto. 4.4 An lication of Other Sums. All sums received by Beneficiary under Section 4.2 or Section 1.2, less all costs and expenses incurred by Beneficiary or any receiver under Section 4.2 or Section 1.2, including, without limitation, attorneys' fees, shall be applied in payment of the Secured Obligations in such order as Beneficiary shall determine in its sole discretion; provided, however, Beneficiary shall have no liability for funds not actually received by Beneficiary. 4.5 No Cure or Waiver. Neither Beneficiary's nor Trustee's nor any receiver's entry upon and taking possession of all or any part of the Property and Collateral, nor any collection of rents, issues, profits, insurance proceeds, condemnation proceeds or damages, other security or proceeds of other security, or other sums, nor the application of any collected sum to any Secured Obligation, nor the exercise or failure to exercise of any other right or remedy by Beneficiary or Trustee or any receiver shall cure or waive any breach, Default or notice of default under this Deed of Trust, or nullify the effect of any notice of default or sale (unless all Secured Obligations then due have been paid and performed and Trustor has cured all other defaults), or impair the status of the security, or prejudice Beneficiary or Trustee in the exercise of any right or remedy, or be construed as an affirmation by Beneficiary of any tenancy, lease or option or a subordination of the lien of or security interests created by this Deed of Trust. 4.6 Par went of Costs, Expenses and Attorne, s' Fees. Trustor agrees to pay to Beneficiary immediately and without demand all costs and expenses incurred by Trustee and Beneficiary pursuant to Section 4.2 (including, without limitation, court costs and attorneys' fees, whether incurred in litigation or not) with interest from the date of expenditure until said sums have been paid at the rate of interest then applicable to the principal balance of the Note as specified therein. In addition, Trustor shall pay to Trustee all Trustee's fees hereunder and shall reimburse Trustee for all expenses incurred in the administration of this trust, including, without limitation, any attorneys' fees. 4.7 Power to File Notices and Cure Defaults. Trustor hereby irrevocably appoints Beneficiary and its successors and assigns, as its attorney -in -fact, which agency is coupled with an interest, (a) to execute and/or record any notices of completion, cessation of labor, or any other notices that Beneficiary deems appropriate to protect Beneficiary's interest, (b) upon the issuance of a deed pursuant to the foreclosure of the lien of this Deed of Trust or the delivery of a deed in lieu of foreclosure, to execute all instruments of assignment or further assurance with respect to the Property and Collateral, Leases and Payments in favor of the grantee of any such deed, as may be necessary or desirable for such purpose, (c) to prepare, execute and file or record financing statements, continuation statements, applications for registration and like papers necessary to create, perfect or preserve Beneficiary's security interests and rights in or to any of the Property and Collateral, and (d) upon the occurrence of an event, act or J-10 4851-9173-4762v12/022363-0015 omission which, with notice or passage of time or both, would constitute a Default, Beneficiary may perform any obligation of Trustor hereunder; provided, however, that: (i) Beneficiary as such attorney -in -fact shall only be accountable for such funds as are actually received by Beneficiary; and (ii) Beneficiary shall not be liable to Trustor or any other person or entity for any failure to act (whether such failure constitutes negligence) by Beneficiary under this Section. ARTICLE 5. MISCELLANEOUS PROVISIONS 5.1 Merger. No merger shall occur as a result of Beneficiary's acquiring any other estate in, or any other lien on, the Property unless Beneficiary consents to a merger in writing. 5.2 Obligations of Trustor, Joint and Several. If more than one person has executed this Deed of Trust as "Trustor", the obligations of all such persons hereunder shall be joint and several. 5.3 Waiver of Marshalling Rights. Trustor, for itself and for all parties claiming through or under Trustor, and for all parties who may acquire a lien on or interest in the Property and Collateral, hereby waives all rights to have the Property and Collateral and/or any other property, which is now or later may be security for any Secured Obligation ("Other Property") marshalled upon any foreclosure of the lien of this Deed of Trust or on a foreclosure of any other lien or security interest against any security for any of the Secured Obligations. Beneficiary shall have the right to sell, and any court in which foreclosure proceedings may be brought shall have the right to order a sale of, the Property and any or all of the Collateral or Other Property as a whole or in separate parcels, in any order that Beneficiary may designate. 5.4 Rules of Construction. When the identity of the parties or other circumstances make it appropriate, the singular number includes the plural. 5.5 Successors in Interest. The terms, covenants, and conditions herein contained shall be binding upon and inure to the benefit of the heirs, successors and assigns of the parties hereto; provided, however, that this Section 5.5 does not waive or modify the provisions of Section 3.11. 5.6 Execution in Counterparts. This Deed of Trust may be executed in any number of counterparts. All counterparts shall be construed together and shall constitute but one Deed of Trust. 5.7 Governint., Law. This Deed of Trust shall be construed in accordance with the laws of the State of California, except to the extent that federal laws preempt the laws of the State of California. 5.8 Notices. All notices, demands or other communications required or permitted to be given pursuant to the provisions of this Deed of Trust shall be in writing and shall be considered as properly given if delivered personally or sent by first class United States Postal Service mail, postage prepaid, except that Notice of Default may be sent by certified mail, return receipt requested, or by Overnight Express Mail or by overnight commercial courier service, charges prepaid. Notices so sent shall be effective three (3) days after mailing, if mailed by first class mail, and otherwise upon receipt at the address set forth above; provided, however, that non -receipt of any communication as the result of any change of address of which the sending party was not notified or as the result of a refusal to accept delivery shall be deemed receipt of such communication. For purposes of notice, the address of the parties are set forth in the heading of this Deed of Trust. Any party shall have the right to change its address for notice hereunder to any other location within the continental United States by the giving of thirty (30) days' notice to the other party in the manner set forth hereinabove. [Signature Page Follows] J-11 4851-9173-4762v12/022363-0015 IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year set forth above. LAB HOLDING LLC, a California limited liability company Dated: , 20_ By: Its: J-12 4851-91734762v12/022363-0015 ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of On , before me, (insert name of notary) Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature 4851-9173-4762v12/022363-0015 (Seal) ATTACHMENT NO. 1 LEGAL DESCRIPTION LOTS 17 THROUGH 23 INCLUSIVE IN BLOCK M OF THE CENTER TRACT, AS PER MAP RECORDED IN BOOK 14, PAGE 13 OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPT THEREFROM ALL OIL, MINERAL, GAS OR OTHER HYDROCARBON SUBSTANCES BELOW A DEPTH OF 500 FEET UNDER THE SURFACE OF SAID LAND, BUT WITHOUT THE RIGHT OF SURFACE ENTRY OR ANY OTHER USE OF THE LAND ABOVE SUCH 500 FOOT DEPTH, AS RESERVED IN DEED RECORDED MAY 05, 1989 AS INSTRUMENT NO. 89-238472, OFFICIAL RECORDS. APN: 037-024-11, and THE NORTH 100 FEET OF LOTS 17 THROUGH 23, INCLUSIVE, IN BLOCK L OF THE CENTER TRACT AS PER MAP RECORDED IN BOOK 14, PAGE 13 OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. EXCEPTING THEREFROM MINERAL AND OTHER RIGHTS AS RESERVED BY SOUTHERN PACIFIC COMPANY IN DEED RECORDED DECEMBER 20, 1958, IN BOOK 4528, PAGE 251 OF OFFICIAL RECORDS. APN: 037- 111-29, and THE SOUTH 35 FEET OF LOTS 17 THROUGH 23, INCLUSIVE, IN BLOCK L OF THE CENTER TRACT AS PER MAP RECORDED IN BOOK 14, PAGE 13 OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. APN: 037- 111-30 Attachment No. I to Exhibit J 4851-9173-4762v12/022363-0015 EXHIBIT K INSURANCE REQUIREMENTS K-1 4851-91734762vl2/022363-0015 GnEATAmEwcAN lu �a aMNONMENIAL x 9/9/2021 Attn: Nancy Huynh Landmark E&S Insurance Brokers, LLC nhuynh@landmark-es.com GREAT AMERICAN INSURANCE GROUP PREMISES ENVIRONMENTAL LIABILITY PROPOSAL For: Tri Pointe Homes Holding, Inc Great American E & S Insurance Company Form: PRE 30 01 (Ed. 05 13) Domicile State: California Option 1: Policy Term -10 years ENVIRONMENTAL DIVISION 397 Eagleview, Boulevard Suite 100 Exton, PA 19341 From: BobbiAnn Murphy Customer #: 0007051953 If no Limit of Liability or Self -Insured Retention amount appears for a Coverage Section shown below, this Policy does not apply for that Coverage Section. Coverage A. Pollution Legal Liability Each Pollution Condition Limit $ 5,000,000 Coverage Aggregate Limit $ 5,000,000 Self -Insured Retention $ 50,000 B. On -Site and Off -Site Clean -Up Costs $ 5,000,000 $ 5,000,000 $ 50,000 C. Contracting Services Pollution Liability $ 0 $ 0 $ 0 D. Non -Owned Disposal Site $ 5,000,000 $ 5,000,000 $ 25,000 E. In -Bound and Out -Bound ContingentTransportation $ 5,000,000 $ 5,000,000 $ 25,000 F On -Site Clean-up Costs for Biological Hazards $ 25,000 $ 25,000 $ 2,500 Policy Aggregate Limit of Liability: $ 5,000,000 Premium: Premium for Certified Acts of Terrorism: State Tax: K-2 4851-9173-4762v12/022363-0015 $105,445 (25% Minimum Earned) $1,054 Additional Premium $ NIA Broker Responsibility GREATAmER/Cdlk /UI1MIIt8Mo1R omeora�rnuaxmorl Option 2: Policy Term -10 years If no Limit of Liability or Self -Insured Retention amount appears for a Coverage Section shown below, this Policy does not apply for that Coverage Section. Coverage A. Pollution Legal Liability Each Pollution Condition Limit $ 5,000,000 Coverage Aggregate Limit $ 5,000,000 Self -Insured Retention $ 100,000 B. On -Site and Off -Site Clean -Up Costs $ 6,000,000 $ 5,000,000 $ 100,000 C. Contracting Services Pollution Liability $ 0 $ 0 $ 0 D. Non -Owned Disposal Site $ 5,000,000 $ 5,000,000 $ 25,000 E. In -Bound and Out -Bound ContingentTransportation $ 5,000,000 $ 5,000,000 $ 25,000 F. On -Site Clean-up Costs for Biological Hazards $ 25,000 $ 25,000 $ 2,500 Policy Aggregate Limit of Liability: $ 5,000,000 Premium: $ 86,799 (25% Minimum Earned) Premium for Certified Acts of Terrorism: $ 868 Additional Premium State Tax: $ NIA Broker Responsibility Premiums above do NOT include Excess and Surplus Lines Tax Excess and surplus lines taxes, fees and filings are additional and the sole responsibility of the broker. Please furnish us with a copy of your surplus lines license prior to binding. Covered Locations): • 275 and 301 East Santa Ana Street, Anaheim, CA 92805 Retroactive Date: None Reverse Retroactive Date: None Q[mte Version 2. TO Pointe Homes Holding, Inc, 0007051953 K-3 4851-9173-4762v12/022363-0015 GR EATAm ERICA,x .nuluu�aonr e1N IlOIMIe1dLL I01Y1lON Endorsements & Exclusions PRE 37 00 (Ed. 0513)- NOTICE OF POLLUTION CONDITIONS - KNOWLEDGE OF A RESPONSIBLE PERSON PRE 39 3T (Ed. 0515)- CANCELLATION CONDITION AMENDATORY ENDORSEMENT- OPPORTUNITY TO CURE PRE 36 24 (Ed. 0513)- DOCUMENT SCHEDULE PRE 34 08 (Ed. 0513)- INTENTIONAL ACTS EXCLUSION AMENDMENT PRE 3419 (Ed. 01 20)- TERRORISM COVERAGE ENDORSEMENT PRE 34 21 (Ed. 01 1S)- EXCLUSION OF TERRORISM COVERAGE PRE 34 30 (Ed. 0613). MATERIAL CHANGE IN USE EXCLUSION AMENDMENT - SPECIFIED USE DEEMED NOT TO BE A MATERIAL CHANGE PRE 34 45 (Ed.10 IS)- ASBESTOS AND LEAD -BASED PAINT EXCLUSIONS AMENDMENTS - COVERAGE A AND COVERAGE B FOR INADVERTENT DISTURBANCES PRE 3218 (Ed. 0613M MOLD MATTER EXCLUSION PRE 3169 (Ed. 021S)- COVERAGE B - CLEAN-UP COSTS RESTRICTION - GOVERNMENTAL CLAIMS ONLY FOR PRE-EXISTING CONDITIONS PRE 30 04 (Ed. 0613M ADDITIONAL INSURED ENDORSEMENT PRE 32 39 (Ed. 0613)- BIOLOGICAL TERRORISM COVERAGE (requires the purchase of TRIA) PRE MANUS (09 21)- PREMISES ENVIRONMENTAL LIABILITY ENHANCEMENT ENDORSEMENT WITH TRANSPORTATION BY THE INSURED PRE MANUS (09 21)- DIVESTED PROPERTY EXCLUSION AMENDMENT (subject to GAIG legal review and approval) PRE MANUS (09 21)- ON -SITE MATERIALS HANDLING EXCLUSION DURING SITE DEVELOPMENT - COVERAGE B (subject to GAIG legal review and approval) Any applicable state endorsements or notices. Exclusions In the quotation Include, but are not limited to, the terms and conditions outlined above. Please refer to the policy contract for specifics. Any other coverage extensions, deletions, or changes requested in the submission are hereby rejected. Quote Conditions This quote is subject to receipt and satisfactory underwriting review of the following prior to binding: • Completed and signed Great American Application for Environmental Insurance, Quote Version 2: Tri Pointe Homes Holding, Inc, 0007051953 K-4 4551-917311762vl2/022363-0015 GREATAMER AN anuwu�rour tHweow�xoaomaoM • Completed Surplus Lines Tax letter (broker responsibility). • Signedidated Terrorism Disclosure Notice. Terms • Payment Terms - In order to bind coverage, we must receive your written instructions confirming coverage(s) desired prior to releasing policy numbers. The full premium payment is due thirty (30) days from the effective date of the coverage. • Quote Expiration Date-10/8/2021 Please carefully review all of the terms, conditions, and subjectivities contained in this Proposal. This Proposal may not contain all the coverage grants, enhancements and other items requested in any specifications or materials submitted to Great American for consideration. Great American is only bound by those terms explicitly set forth in a policy of insurance that it issues. K-5 4851-9173-4762v12/022363-0015 GREATAmER[cA,x wAVMGW r aMFKNVABmumvmoa Great American Environmental • Expertise and Experience Making a Difference Specialized service oriented underwriting staff currently averaging over 18 years environmentall insurance experience Integrated underwriting, claims handling and engineering 24/7/365 emergency response support Ability to offer manuscript policy forms to meet specific client needs Ability to provide coverage for pollution conditions excess of indemnities Ability to offer coverage for "credit risk' liabilities such as fronted policies, Closure/Post-Closure, and lender liability policies Ability to offer admitted paper via deregulation and large risk exemption Exceptional claims services and handling Premium financing is available Approved insurance provider for Massachusetts Brownfields Access to Capital and Ohio EPA Voluntary Action Program Risk control services Financially strong paper - Best Rating of A for over 100 consecutive years Quick turnaround times to meet tight deadlines One stop shopping with all decisions on an account being made within the environmental unit Great American Environmental Risk Control Support Services Risk Control Services may be available to current and prospective insureds of Great American Environmental through our network of specialty vendors representing diverse capabilities and experience in a variety of environmental areas. Mold and Microbial Matter: Assistance in the development of management plans related to water intrusion and mold or microbial matter issues Training of personnel in property inspection protocols Assistance with the implementation of the management plan Follow-up auditing to ensure compliance with the guidelines K-6 4851-9173-4762v12/022363-0015 OMMAMOMW GMEMIMMo Asbestos and Lead Paint: Assistance in the development of management plans related to asbestos and lead based paint issues Training of personnel in property inspection protocols Assistance with the implementation of the management plan Follow-up auditing to ensure compliance with the guidelines K-7 4851-9173-4762v12/022363-0015 GR A'41WRI[OW UWAN f MOW .ry.ma� a ie 1 BobbiAnn Murphy, Master Underwriter Great American Insurance Group Environmental Division 397 Eagleview Boulevard, Suite 100 Exton, PA 19341 (484) 212-7732 ph (215) 356-7505 cell bmurphy2@gaig.com http://www.greatameeicaninsurance.com/environmental.html Quote Version 2: Tn Pointe Homes Holding, Inc, 0007051953 8 K-8 4851-91734762v12/022363-0015 GREATAMERICAN �p1AlAl10:Mo1R nmaorrmrnuomaar ENDORSEMENT # 1 PRE 37 00 (Ed. 0513) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. NOTICE OF POLLUTION CONDITIONS - KNOWLEDGE OF A RESPONSIBLE PERSON This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Section VII. REPORTING, DEFENSE, SETTLEMENT, AND COOPERATION, Item A., is deleted in its entirety and replaced with the following: A. As a condition precedent to the coverage hereunder, in the event a CLAIM is made against an INSURED for LOSS or CLEAN-UP COSTS, or a POLLUTION CONDITION is first discovered that results in a LOSS, BUSINESS INTERRUPTION OR CONTINGENT BUSINESS INTERRUPTION LOSS, EXTRA EXPENSE or CLEAN-UP COSTS, written or oral notice containing particulars sufficient to identify the INSURED and all reasonably obtainable information with respect to the time, place, and circumstances thereof, and the names and addresses of the injured and of available witnesses, shall be given by or for the INSURED to the Company or any of its authorized agents as soon as practicable after a RESPONSIBLE PERSON obtains knowledge of such CLAIM or POLLUTION CONDITION. In the event of oral notice, the INSURED agrees to furnish a written report as soon as practicable. The INSURED shall also forward to the Company every demand, notice, summons, order or other process received by an INSURED or an INSURED's representative as soon as practicable. Alt other terms and conditions remain the same. K-9 4851-9173-4762vl2/022363-0015 GREATAMERIcAN. e 611" ex+WANINIUMPNmoN ENDORSEMENT # 2 PRE 39 37 (Ed. 0515) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. CANCELLATION CONDITION AMENDATORY ENDORSEMENT — OPPORTUNITY TO CURE This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Section IX. CONDITIONS, Item D. CANCELLATION, is deleted in its entirety and replaced with the following: D. CANCELLATION —This Policy may be cancelled by the FIRST NAMED INSURED by surrender thereof to the Company or any of its authorized agents or by mailing, delivering, emailing, or faxing to the Company written notice stating when thereafter the cancellation shall be effective. In the event of cancellation by the FIRST NAMED INSURED, the return premium shall be computed in accordance with the customary short rate table and procedure after applying the minimum earned premium percentage stated in the Declarations. If a CLAIM is made, a POLLUTION CONDITION is discovered, or coverage is otherwise afforded under this Policy, then the premium shall be considered fully earned by the Company and the INSURED is not entitled to a return premium upon cancellation. This Policy may be cancelled by the Company by mailing, delivering, emailing, or faxing written notice to the FIRST NAMED INSURED at the address shown in the Declarations which states when, not less than ninety (90) days (ten (10) days for non-payment of premium) thereafter such cancellation shall be effective. However, if the Policy is to be cancelled for non-payment of premium, and the total unpaid premium is received by the Company prior to the effective date of cancellation set forth in the notice, the Policy will not be cancelled. The mailing, delivering, emailing, or faxing of notice as aforesaid shall be sufficient proof of notice. The time of surrender or the effective date and hour of cancellation stated in the notice shall become the end of the POLICY PERIOD. If the Company cancels, earned premium shall be computed pro rats. Premium adjustment may be made either at the time cancellation is affected or as soon as practicable after cancellation becomes effective, but payment or tender of unearned premium is not a condition of cancellation. This Policy may be cancelled by the Company for the following reasons: (1) non-payment of premium; or (2) fraud or material misrepresentation on the part of an INSURED, such as can be proven in a court of law. All other terms and conditions remain the same. K-10 4851-9173-4762v12/022363-0015 -ram GREATAmEtuCAx arulmewiff emlwlweHnuofvawrl ENDORSEMENT#3 PRE 36 24 (Ed. 0613) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. DOCUMENT SCHEDULE This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Any, POLLUTION CONDITION identified and described in the following document(s) is deemed to be "specifically reported" to the Company: • Phase I Environmental Site Assessment, 275 and 325 E Santa Ana Street, Anaheim, CA, prepared by ENV America, dated January 20, 2004 All other terms and conditions remain the same. Quote Version 2: Trl Pointe Homes Holding, Inc. 0007051953 17 K-11 4851-9173-4762v12/022363-0015 GREAT MERICA K WUw1w &VW emwwwaxaty n ENDORSEMENT # 4 PRE 34 08 (Ed. 0513) This endorsement, effective 12:01 a.m., , forms a part of Policy No. Issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. INTENTIONAL ACTS EXCLUSION AMENDMENT This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Section IV. EXCLUSIONS, Item 11. Intentional Acts, is deleted in its entirety and replaced with following: 11. Intentional Acts based upon or arising out of a POLLUTION CONDITION that results from any RESPONSIBLE PERSON's intentional disregard of, or deliberate, willful, or dishonest non-compliance with, any statute, regulation, ordinance, administrative complaint, notice letter, or instruction issued by or on behalf of any governmental agency or representative. However, this exclusion shall not apply to any such intentional disregard, or deliberate, willful, or dishonest non-compliance that was based solely upon the good -faith reliance on a written opinion of qualified, outside legal counsel, where such opinion was received by the INSURED prior to the RESPONSIBLE PERSON's intentional disregard, or deliberate, willful, or dishonest non-compliance. All other terms and conditions remain the same. K-12 4851-91734762vl2/022363-0015 -�—� GREATAmER,c" WFAIMAMMOM9oM ENDORSEMENT # 6 PRE 3419 (Ed. 01 20) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. TERRORISM COVERAGE ENDORSEMENT This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY Pursuant to the requirements of the federal Terrorism Risk Insurance Act, the INSURED has been provided notice that the INSURED may elect to purchase coverage for loss covered under this Policy arising directly or indirectly as a result of CERTIFIED ACT(s) OF TERRORISM and the premium charge for such coverage. After receiving such notice, the INSURED has elected to purchase this Policy with coverage for such CERTIFIED ACT(s) OF TERRORISM. Therefore, in consideration of the premium paid, the INSURED and the Company agree to the following Policy changes: 1. Section IV EXCLUSIONS, Item 8. Hostile Acts, is deleted in its entirety and replaced with the following: Hostile Acts based upon or arising out of any consequence, whether direct or indirect, of declared or undeclared war, invasion, act of foreign enemy, hostilities, and whether war be declared or not, civil war, rebellion, revolution, insurrection, or military or usurped power, or in defending against any one or more of those. This exclusion does not apply to: (a) CERTIFIED ACT(s) OF TERRORISM subject to the CAP ON CERTIFIED TERRORISM LOSSES; (b) NON -CERTIFIED ACT(s) OF TERRORISM. 2. Section II. DEFINITIONS is amended by the addition of the following: CERTIFIED ACT(s) OF TERRORISM means an act that is certified by the Secretary of the Treasury, in concurrence with the Secretary of Homeland Security and the Attorney General of the United States, to be an act of terrorism as defined in Section 102(1) of the Terrorism Risk Insurance Act. CAP ON CERTIFIED TERRORISM LOSSESas established in the Terrorism Risk Insurance Act, means if the aggregate insured losses attributable to CERTIFIED ACT(s) OF TERRORISM exceed $100 billion in a calendar year and we have met our insurer deductible under the federal Terrorism Risk Insurance Act, the Company shall not be liable for the payment of any portion of the amount of such losses that exceeds $100 billion, and in such case insured losses up to that amount are subject to pro rata allocation in accordance with procedures established by the Secretary of the Treasury. K-13 4851-9173-4762v12/022363-0015 GREATAAWRIcAN UNU M OMW H1VR�18§Wft0M K PRE 3419 (Ed. 01 20) NON -CERTIFIED ACT(s) OF TERRORISM means an act by any person or group of persons that is designed to: (a) influence the conduct of the government of the United States of America; or (b) intimidate all or part of the civilian population of the United States of America, and: (i) involves violence against one or more persons; or (ii) involves damage to tangible property; or (iii) creates a risk to the health or safety of the public, but only if such act is not a CERTIFIED ACT(s) OF TERRORISM. Multiple incidents of a NON -CERTIFIED ACT(s) OF TERRORISM which occurwithin a twenty-four hour period and appear to be carried out in concert or to have a related purpose or common leadership shall be considered to be a single act. 3. Coverage for CERTIFIED ACT(s) OF TERRORISM will be automatically deleted from this Policy if: (a) the federal Terrorism Risk Insurance Program ("Program'), as established by the federal Terrorism Risk Insurance Act is terminated or otherwise becomes inapplicable with respect to the type of insurance provided by this Policy; or (b) no renewal or replacement of the federal Terrorism Risk Insurance Act is enacted prior to January 1, 2028, unless the federal Terrorism Risk Insurance Act is thereafter extended without any lapse in the Program. 4. In the event that coverage for CERTIFIED ACT(s) OF TERRORISM is deleted from this Policy pursuant to the preceding paragraph: (a) notwithstanding Item 10. of the Declarations, the premium set forth in Item 9. of the Declarations for terrorism coverage will be considered 100% earned; and (b) no return premium will be due to the INSURED. All other terms and conditions remain the same. K-14 4851-9173-4762vl2/022363-0015 GREATUft< CAN rmmunam a offlFANaamow" ENDORSEMENT # 6 PRE 34 21 (Ed. 01 16) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. EXCLUSION OF TERRORISM COVERAGE This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY Pursuant to the requirements of the federal Terrorism Risk Insurance Act, the INSURED has been provided notice that the INSURED may elect to purchase coverage for loss covered under this Policy arising directly or indirectly as a result of CERTIFIED ACT(s) OF TERRORISM and the premium charge for such coverage. After receiving such notice, the INSURED has elected not to purchase coverage for CERTIFIED ACT(s) OF TERRORISM and has agreed to the following Policy changes: 1. Section IV EXCLUSIONS, Item 8. Hostile Acts, is deleted in its entirety and replaced with the following: Hostile Acts based upon or arising out of any consequence, whether direct or indirect, of declared or undeclared war, invasion, act of foreign enemy, hostilities, CERTIFIED ACT(s) OF TERRORISM, and whether war be declared or not, civil war, rebellion, revolution, insurrection, or military or usurped power, or in defending against any one or more of those. 2. Section II. DEFINITIONS is amended by the addition of the following: CERTIFIED ACT(s) OF TERRORISM means an act that is certified by the Secretary of the Treasury, in concurrence with the Secretary of Homeland Security and the Attorney General of the United States, to be an act of terrorism pursuant to the federal Terrorism Risk Insurance Act. All other terms and conditions remain the same. K-15 4851-9173-4762v12/022363-0015 GREATAHElucAN MVAAW our WFAM NMONmon ENDORSEMENT # 7 PRE 34 30 (Ed. 0513) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. MATERIAL CHANGE IN USE EXCLUSION AMENDMENT - SPECIFIED USE DEEMED NOT TO BE A MATERIAL CHANGE This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Section IV. EXCLUSIONS, Item 14. Material Change in Use, is deleted in its entirety and replaced with the following: 14. Material Change in Use based upon or arising out of a change in the use of, or operations at, a COVERED LOCATION from the use or operations as of the date the COVERED LOCATION became insured by this Policy, if that change materially increases the likelihood or severity of a POLLUTION CONDITION or CLAIM. For purposes of this endorsement, the following use(s) will not be deemed by the Company to represent a change in the use of, or operations at, a COVERED LOCATION that materially increases the likelihood or severity of a POLLUTION CONDITION or CLAIM: Redevelopment into residential All other terms and conditions remain the same. K-16 4851-91734762v12/022363-0015 GREATAMER,CAK . Qww emwrwEur 0W5= ENDORSEMENT#8 PRE 34 46 (Ed.1016) This endorsement, effective 12:01 a.m., , forms a part of Policy No. Issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ASBESTOS AND LEAD -BASED PAINT EXCLUSIONS AMENDMENTS - COVERAGE A AND COVERAGE B FOR INADVERTENT DISTURBANCES This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Section IV EXCLUSIONS, Items 1. Asbestos and 13. Lead -Based Paint, are deleted in their entirety and replaced with the following: 1. Asbestos based upon or arising out of the existence of, required removal of, or abatement of, asbestos in any form, including but not limited to, products containing asbestos, asbestos fibers, asbestos dust, and asbestos containing materials. This exclusion shall not apply: (a) to Coverages A or C; (b) to CLEAN-UP COSTS and related LEGAL EXPENSE under Coverage 8 that arise out of the inadvertent disturbance of asbestos or asbestos containing materials; (c) with respect to Coverages B, D and G, to asbestos in any form, in soil or in any watercourse or body of water including groundwater; or (d) with respect to Coverage E, where the exposure to asbestos in any form occurs during the course of transportation, but only if the discharge, dispersal, release, seepage, migration, or escape of asbestos in any form first commences during the POLICY PERIOD. K-17 4851-91734762vl2/022363-0015 GREEATAmrM& ! BIYF40N AVNML OBNADN PRE 34 46 (Ed.1016) 13. Lead -Based Paint based upon or arising out of lead -based paint in, on, or applied to, any building or other structure. This exclusion does not apply to: (a) Coverages A or C; (b) CLEAN-UP COSTS and related LEGAL EXPENSE under Coverage B that arise out of the inadvertent disturbance of lead -based paint; or (c) lead -based paint in soil or in any watercourse or body of water including groundwater. All other terms and conditions remain the same. K-18 4851-9173-4762v12/022363-0015 GPLEAXAMERICAN IaiPAMMW DMIONMewnuONWN ENDORSEMENT # 9 PRE 3218 (Ed. 0513) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRi POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. MOLD MATTER EXCLUSION This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): 1. Section II. DEFINITIONS, Item BB. POLLUTANTS, is deleted in its entirety and replaced with the following: BB. POLLUTANTS mean any solid, liquid, gaseous, or thermal pollutant, irritant, or contaminant, including but not limited to smoke, vapors, odors, soot, fumes, acids, alkalis, toxic chemicals, hazardous substances, petroleum hydrocarbons, waste, including medical, infectious, red bag, and pathological wastes, legionella, electromagnetic fields and low-level radioactive waste and material. However, POLLUTANTS do not include MOLD MATTER. 2. Section II. DEFINITIONS, Item CC. POLLUTION CONDITION, Paragraph 1, is deleted in its entirety and replaced with the following: CC. POLLUTION CONDITION means: 1. with regard to Coverages A, B, C, D, E and G, any one or more of the following (a) the discharge, dispersal, release, seepage, migration, or escape of POLLUTANTS into or upon land or structures thereupon, the atmosphere, or any watercourse or body of water including groundwater; (b) the illicit abandonment of contained or uncontained POLLUTANTS at a COVERED LOCATION, but only if such abandonment was committed by a person(s) or entity(ies) other than an INSURED and without any knowledge by any RESPONSIBLE PERSON; (c) the existence of methampheta mines or other chemicals associated with methamphetamine laboratories, on, at, or within buildings or structures; 3. Section IV EXCLUSIONS is amended by the addition of the following: Mold Matter based upon or arising out of the existence of MOLD MATTER. All other terms and conditions remain the same. K-19 4851-91734762vl2/022363-0015 GRFnTTAme,uc4N. e.� K-20 4851-9173-4762v12/022363-0015 PRE 3218 (Ed. 0613) GREATAMERIC4x wstlluaeEwour ENDORSEMENT # 10 PRE 3169 (Ed. 0216) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. COVERAGE B - CLEAN-UP COSTS RESTRICTION - GOVERNMENTAL CLAIMS ONLY FOR PRE-EXISTING CONDITIONS This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Solely with regard to any POLLUTION CONDITION that first commenced prior to insert policy inception date, including any further dispersal, migration or movement of such POLLUTION CONDITION on or after that date, Section I. INSURING AGREEMENTS, B. COVERAGE B — ON -SITE AND OFF -SITE CLEAN-UP COSTS, is deleted in its entirety and replaced with the following: S. COVERAGE B - ON -SITE AND OFFSITE CLEAN-UP COSTS The Company will pay on behalf of the INSURED for CLEAN-UP COSTS and related LEGAL EXPENSE because of a POLLUTION CONDITION on, at, under, or migrating from a COVERED LOCATION which the INSURED becomes legally obligated to pay as a result of a CLAIM first made against the INSURED, during the POLICY PERIOD, by a governmental entity acting under the authority of applicable environmental regulations, but only if: 1. neither the INSURED, nor anyone acting on behalf of the INSURED, has approached or contacted any governmental entity regarding such POLLUTION CONDITION or otherwise requested or solicited such CLAIM; and 2. the INSURED notifies the Company of the CLAIM, in writing, during the POLICY PERIOD or, if applicable, the EXTENDED REPORTING PERIOD. All other terms and conditions remain the same. Quote Version 2: Th Pointe Homes Holding. Inc, 0007051953 22 K-21 4851-9173-4762v12/022363-0015 GREATAMERICA,x 0WA%Q d Nr em xm ENDORSEMENT # 11 PRE 30 04 (Ed. 0613) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED ENDORSEMENT This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Each of the following entities is an ADDITIONAL INSURED: City of Anaheim Lab Holding, LLC All other terms and conditions remain the same. K-22 4851-9173-4762v12/022363-0015 GREATAmEjucAx mrWAeea1W am KNOUNI Amrraorr ENDORSEMENT#12 PRE 32 39 (Ed. 0613) This endorsement, effective 12:01 a.m., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. BIOLOGICAL TERRORISM COVERAGE This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): 1. Section II. DEFINITIONS, Item BB. POLLUTANTS, is deleted in its entirety and replaced with the following: BB. POLLUTANTS mean any solid, liquid, gaseous, or thermal pollutant, irritant, or contaminant, including but not limited to smoke, vapors, odors, soot, fumes, acids, alkalis, toxic chemicals, hazardous substances, petroleum hydrocarbons, waste, including medical, infectious, red bag, and pathological wastes, legionella, electromagnetic fields, MOLD MATTER, low-level radioactive waste and material and BIOLOGICAL AGENTS. 2. Section II. DEFINITIONS is amended by the addition of the following: BIOLOGICAL AGENTS mean viruses, bacteria, or other agents used to cause illness or death in people, animals, or plants as defined by the U.S. Center for Disease Control and Prevention, provided such viruses, bacteria, or other agents were deliberately released, discharged, or dispersed by a party other than an INSURED with the intent to cause injury to persons or property and to influence either the policy or conduct of the U.S. Government through coercion. All other terms and conditions remain the same. K-23 4851-91734762v12/022363-0015 GREATAMERICMI. wsae�ncE®an errwo�oiera�onwox ENDORSEMENT # 13 PRE MANUS (09 21) This endorsement, effective 12:01 am., , forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & 3 Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PREMISES ENVIRONMENTAL LIABILITY ENHANCEMENT ENDORSEMENT WITH TRANSPORTATION BY THE INSURED This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): 1. Section I. INSURING AGREEMENTS is amended by the addition of the following: H. COVERAGE H — DIMINUTION IN VALUE OF A COVERED LOCATION The Company will pay the INSURED's DIMINUTION IN VALUE that is solely because of the discovery by the INSURED of a POLLUTION CONDITION on, at, or under a COVERED LOCATION, but only if: 1. that POLLUTION CONDITION is first discovered by the INSURED during the POLICY PERIOD; 2. that POLLUTION CONDITION has been reported to the appropriate governmental agency in compliance with applicable environmental laws in effect as of the date of discovery; and 3, the INSURED notifies the Company of the POLLUTION CONDITION, in writing, during the POLICY PERIOD or, if applicable, the Automatic Extended Reporting Period. In the event of a dispute between the FIRST NAMED INSURED and the Company over the amount of the DIMUNITION IN VALUE of the COVERED LOCATION or the FAIR MARKET VALUE of the COVERED LOCATION, the dispute will be determined by an APPRAISAL. 2. Item 3. of the Declarations, Coverages and Coverage Section Limits of Liability and Self -Insured Retention, is amended by the addition of the following: Coverage Each POLLUTION Coverage Aggregate Self -Insured CONDITION Limit_ Limit Retention H. $5,000,000 $5,000,000 $TBD - Based on option selected K-24 4851-9173-4762v12/022363-0015 GREATAMERICAN. ONCE GOW ENWARMINMOMMM PRE MANUS (09 21) Under no circumstances will the Company's total liability for the sum of all LOSS, CLEAN-UP COSTS, BUSINESS INTERRUPTION OR CONTINGENT BUSINESS INTERRUPTION LOSS, EXTRA EXPENSE, LEGAL EXPENSE, DIMINUTION IN VALUE, and any other coverages afforded under this Policy exceed the Policy Aggregate Limit of Liability as set forth in Item 4. of the Declarations. 3. Section It. DEFINrrIONS, Items G. CARRIER, I. CLEAN-UP COSTS and CC. POLLUTION CONDITION, are deleted in their entirety and replaced with the following: G. CARRIER means a person or entity, including an INSURED or any subsidiary or affiliate company of an INSURED, engaged by or an behalf of the INSURED to transport material by AUTOMOBILE, aircraft, watercraft, or rolling stock, but only if such person or entity is properly licensed to transport such material and in the business of transporting such material. I. CLEAN-UP COSTS mean: 1. with regard to Coverages B, C, D, and E, the reasonable and necessary expenses incurred to investigate, remove, dispose of, abate, contain, treat, or neutralize any POLLUTION CONDITION, other than the existence of MOLD MATTER on, at, or within buildings or structures, including any associated monitoring and testing costs: (a) to the extent required by federal, state, local, or provincial laws, including but not limited to statutes, rules, ordinances, guidance documents, regulations and all amendments thereto, including state voluntary cleanup or risk based corrective action guidance, governing the liability or responsibilities of the INSURED; or (b) in the absence of the items in (a) above, to the extent recommended by an ENVIRONMENTAL PROFESSIONAL. 2. solely with regard to Coverage F, the reasonable and necessary expenses incurred to remove, dispose of, contain, treat, or neutralize BIOLOGICAL HAZARDS, including any associated monitoring and testing costs. However, CLEAN-U P COSTS under Coverage F shall not include any costs or fees arising from, related to, or associated with: (i) the removal or disposal of any human remains; or (t) any EMT, ambulance service, fire department, medical examiner or law enforcement agency; 3. solely with regard to the existence of MOLD MATTER on, at, or within buildings or structures, the reasonable and necessary expenses incurred, as determined by an ENVIRONMENTAL PROFESSIONAL, for: (a) MOLD REMEDIATION; or (b) MOLD -RELATED DRYING. However, with regard to the existence of MOLD MATTER on, at or within buildings or structures, CLEAN-UP COSTS do not include any costs or expenses: (i) incurred to address, or respond in any way to, any water, water intrusion event, moisture condition, or similar issue; or (i) for any repairs or capital improvements undertaken, in an effort to prevent the growth of MOLD MATTER in all or any part of any building or structure where it has not been confirmed to exist by an ENVIRONMENTAL PROFESSIONAL, including but not limited to any costs or expenses for drying, dehumidifying, or similar activities undertaken in all or any part of any such building or structure or for drying or dehumidifying any building materials. K-25 4851-9173-4762v12/022363-0015 GREATAMERICrW. ero11"Ummmox PRE MANUS (09 21) Subject to the applicable Limits of Liability, CLEAN-UP COSTS include: (a) REPLACEMENT COSTS; (b) EMERGENCY RESPONSE COSTS; (c) any associated punitive, exemplary, or multiplied damages where insurable by law; and (d) civil fines, penalties and assessments, but only to the extent they: (i) arise solely from the investigation, removal, disposal of, abatement, containment, treatment or neutralization of a POLLUTION CONDITION; (it) are imposed by a government entity acting under authority of applicable federal, state, local or provincial laws; and (iii) are insurable by law. CC. POLLUTION CONDITION means: 1. with regard to Coverages A, B, C, D, E, G, and H any one or more of the following: (a) the discharge, dispersal, release, seepage, migration, or escape of POLLUTANTS into or upon land or structures thereupon, the atmosphere, or any watercourse or body of water including groundwater; (b) the illicit abandonment of contained or uncontained POLLUTANTS at a COVERED LOCATION, but only if such abandonment was committed by a person(s) or entity(ies) other than the INSURED and without the knowledge of any RESPONSIBLE PERSON; (c) the existence of MOLD MATTER, meth amphetamines, or other chemicals associated with methamphetamine laboratories, on, at, or within buildings or structures; 2. solely with regard to Coverage E, the illicit abandonment of waste, beyond the legal boundaries of a COVERED LOCATION by a person or entity, other than the INSURED or any subsidiary or affiliate company of the INSURED, engaged by or on behalf of the INSURED to transport waste by AUTOMOBILE, aircraft, watercraft, or rolling stock, but only if: (a) such person or entity is properly licensed to transport such material and in the business of transporting such material; and (b) such illicit abandonment was committed by such person or entity without the knowledge of any RESPONSIBLE PERSON; and 3. solely with regard to Coverage F, the dispersal or release of BIOLOGICAL HAZARDS as the direct result of a suicide, homicide, or other violent crime, 4. Section II. DEFINITIONS is amended by the addition of the following: APPRAISAL means the process to determine DIMINUTION IN VALUE, if the parties cannot agree on such DIMINUTION IN VALUE. The INSURED and the Company will each select a competent and impartial appraiser. The two appraisers will select an umpire. If they cannot agree, either party may request that the selection of an umpire be made by ajudge of a court having jurisdiction. The appraisers will state separately their determination of DIMINUTION IN VALUE and FAIR MARKET VALUE. If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two will be binding. Each party will: 1. pay its chosen appraiser; and K-26 4851-91734762v12/022363-0015 GREATAMERICAN WrIONNOUNLUMSKM PRE MANUS (09 21) 2. bear the other expenses of the appraisal and umpire equally. Even if an APPRAISAL is undertaken, coverage for DIMINUTION IN VALUE is subject to the terms and conditions of the Policy. BUILDING means any man-made structure used or intended for supporting or sheltering continuous occupancy by human beings. CLEAN-UP PLAN means a plan to remove, dispose of, abate, contain, treat, or neutralize a POLLUTION CONDITION to the extent required by applicable environmental laws, but only if: 1. the plan has been approved by a governmental agency acting under the authority of environmental laws; or 2 if there is no governmental agency as described in item 1. of this Definition, the plan has been approved by both the FIRST NAMED INSURED and the Company. CLEAN-UP PLAN COMPLETION means the date: 1. when the governmental agency, acting under authority of applicable environmental laws, with responsibility for overseeing the implementation of the CLEAN-UP PLAN issues a No Further Action Letter or similar documentation indicating that no further action is required with regard to the POLLUTION CONDITION in question; or 2. if there is no governmental agency as described in item 1. of this Definition, or if that entity does not issue a No Further Action Letter or similar documentation after written request to do so, when the INSURED, with the written consent of the Company, has determined that all necessary steps to address the POLLUTION CONDITION in question have been completed to the extent required by applicable environmental laws. DIMINUTION IN VALUE means the difference between: 1. the FAIR MARKET VALUE of a COVERED LOCATION where a POLLUTION CONDITION has been discovered, as of CLEAN-UP PLAN COMPLETION; and 2 the FAIR MARKET VALUE of the same COVERED LOCATION as of CLEAN-UP PLAN COMPLETION, had there been no POLLUTION CONDITION, but only to the extent that the difference is attributable to the existence of that POLLUTION CONDITION at that COVERED LOCATION. FAIR MARKET VALUE means the price in cash that a COVERED LOCATION would bring, if then offered for sale in the open market, in competition with similar properties at or near such COVERED LOCATION, with a reasonable time allowed to find a purchaser. MOLD -RELATED DRYING means drying, dehumidifying, or similar activities undertaken, in all or any part of any fully enclosed building or structure, after the existence of MOLD MATTER is confirmed by an ENVIRONMENTAL PROFESSIONAL and then only to the extent those drying, dehumidifying, or similar activities are necessary to complete MOLD REMEDIATION. MOLD REMEDIATION means: 1. the treatment of MOLD MATTER that has been confirmed to exist on, at, or within a building or structure by an ENVIRONMENTAL PROFESSIONAL, exclusive of any MOLD -RELATED DRYING; or K-27 4851-91734762v12/022363-0015 GREATAn1Exufuv 1 aw ewna muff aonmaN PRE MANUS (09 21) 2. the removal and disposal of building materials impacted by MOLD MATTER, as confirmed by an ENVIRONMENTAL PROFESSIONAL, that are within a fully enclosed building or structure. 5. Item 3. of the Declarations, Coverages and Coverage Section Limits of Liability and Self -Insured Retention, is amended by the addition of the following: Notwithstanding the foregoing: (a) a Self -Insured Retention of: () $10.000 will apply to the reasonable and necessary expenses incurred, as determined by an ENVIRONMENTAL PROFESSIONAL for MOLD -RELATED DRYING; and (i) $TBD - Based on option'selected will apply to the reasonable and necessary expenses incurred, as determined by an ENVIRONMENTAL PROFESSIONAL for MOLD REMEDIATION. (b) an Each POLLUTION CONDITION Sublimit of Liability $25.000 and a Policy Aggregate Sublimit of Liability of $25.000 will apply to the reasonable and necessary expenses incurred, as determined by an ENVIRONMENTAL PROFESSIONAL for MOLD -RELATED DRYING. Notwithstanding Section VI. LIMIT OF LIABILITY AND SELF -INSURED RETENTION, Item H., payment by the Company of any reasonable and necessary expenses incurred, as determined by an ENVIRONMENTAL PROFESSIONAL, for MOLD - RELATED DRYING will not erode the applicable Limits of Liability. In the event of a conflict between the Self -Insured Retention Amounts set forth in this Endorsement and those set forth in any other Endorsement issued by the Company, only the single highest applicable Self -Insured Retention Amount will apply. 6. Section VII. REPORTING, DEFENSE, SETTLEMENT AND COOPERATION, Item B., is deleted in its entirety and replaced with the following: B. No costs, charges or expenses shall be incurred, nor payments made, obligations assumed or remediation commenced, without the Company's consent which shall not be unreasonably withheld. This provision does not apply to: 1. EMERGENCY RESPONSE COSTS. But only if the INSURED: () reports, in writing, the applicable POLLUTION CONDITION to the Company and solicits the Company's assistance in responding to such POLLUTION CONDITION no later than seven (7) days after the applicable emergency first commences; (11) immediately provides to the Company, upon request, all information available to the INSURED related to such EMERGENCY RESPONSE COSTS, including but not limited to: a description of the actions taken, reports, sampling results, correspondence and invoices; and (III) fully complies with terms of Section VII of this Policy. The Company has no duty to pay EMERGENCY RESPONSE COSTS incurred more than seven (7) days after the applicable emergency first commences unless such EMERGENCY RESPONSE COSTS are consented to by the Company prior to being incurred by the INSURED; and 2. the reasonable and necessary costs and fees incurred by the INSURED (up to a maximum of $250.000 and subject to a separate Self -Insured Retention of $25.000 for each POLLUTION CONDITION that is to be paid by the INSURED in addition to any other applicable Self -Insured Retention) for the hiring of a public relations firm to minimize potential harm to the INSURED and to maintain and restore public confidence in the INSURED, K-28 4851-9173 4762v l 2/022363-0015 GREAT4mERrcw, HIRJRV E ervro UAXM D ASM PRE MANUS (09 21) including amounts for printing, advertising, and mailing of materials, and travel expenses by the INSURED's directors, officers, employees or agents or by employees of the public relations firm, but only if: (A) those costs and fees arise directly from a POLLUTION CONDITION for which coverage is not otherwise excluded under this Policy; and (B) in the good -faith, reasonable opinion of the INSURED such POLLUTION CONDITION: (i) poses an imminent health risk to the public or will result in imminent property damage to any location that is not a COVERED LOCATION; and (i) will result in significant and material adverse publicity to the INSURED. Subject to: (a) the Company's pre -approval; (b) the Self -Insured Retention and maximum amount indicated above; and (c) the Company's agreement that both conditions 2(A) and (B) above have been fully satisfied, the Company may also consider paying other related reasonable and necessary expenses that are: (1) incurred by any person or entity that is not an INSURED; and (ii) not otherwise covered as EMERGENCY RESPONSE COSTS, including: psychological counseling, temporary living expenses, travel costs, and expenses to secure areas impacted by the POLLUTION CONDITION. Notwithstanding Section VI. LIMIT OF LIABILITY AND SELF - INSURED RETENTION, Item H., the costs and fees indicated in Item 2. above, as well as the other related expenses indicated in this paragraph, will not erode the applicable Limits of Liability. It is a condition precedent to coverage for all costs and fees outlined in Item 2. above that: (i) such costs and fees arise from a POLLUTION CONDITION for which coverage is sought by the INSURED and afforded by the Company under Coverage A or Coverage B of this Policy; (ii) notwithstanding any language in this Policy to the contrary, the INSURED has fully paid the separate Self -Insured Retention set forth above for public relations expenses; and (W) the INSURED notify the Company of the POLLUTION CONDITION associated with such costs and fees no later than forty-eight (48) hairs after the INSURED first becomes aware of such POLLUTION CONDITION. The payment of costs and fees outlined above by the Company will not be determinative of the Company's obligations under this Policy, nor will it create any inference with regard to the Company's duty to defend or duty to indemnify any INSURED with regard to any CLAIM or POLLUTION CONDITION. 7 Section VI. LIMIT OF LIABILITY AND SELF -INSURED RETENTION is amended by the addition of the following: The Limits of Liability shown in Item 3. of the Declarations are inclusive of LEGAL EXPENSE. An additional Limit for LEGAL EXPENSE in the amount of 25% of the Limits of Liability shown in Item 3. of the Declarations shall apply to all Coverages. This additional Limit is exclusively for LEGAL EXPENSE and applies to both the Each POLLUTION CON DITION Limit and the Coverage Aggregate Limit. This additional Limit for LEGAL EXPENSE is subject to the Self -Insured Retention shown in Item 3. of the Declarations. In the event a CLAIM is made against the INSURED for LOSS or CLEAN-UP COSTS, or a POLLUTION CONDITION is first discovered that results in LOSS, CLEAN-UP COSTS, or any other coverages afforded under this Policy, this additional Limit shall be applied to LEGAL EXPENSE before the applicable Limits of Liability shown in Item 3. of the Declarations. After the additional Limit for LEGAL EXPENSE has been fully eroded, any other covered LEGAL EXPENSE shall erode the applicable Limits of Liability shown in Item 3. of the Declarations. However, once the Company has paid the full applicable Limit of Liability via indemnity payments or otherwise, the Company will have no further obligation to defend or continue to defend the INSURED, nor any obligation to pay any further LEGAL EXPENSE, even if there are additional limits for LEGAL EXPENSE remaining. K-29 4851-91734762v12/022363-0015 GmATAMERICAN NsmuNc W" 91V� DIYNIDN PRE MANUS (09 21) Furthermore, the Policy Aggregate Limit of Liability shown in Item 4. of the Declarations shall be increased by 25 .. However, this increase to the Policy Aggregate Limit of Liability shall only be available for the payment of LEGAL EXPENSE. All other terms and conditions remain the same. K-30 4851-91734762v12/022363-0015 GREATAMERICAIV DWAAMOMW HIMAMM MUNWDN ENDORSEMENT # 14 PRE MANUS (09 21) This endorsement, effective 12:01 am.,, forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. DIVESTED PROPERTY EXCLUSION AMENDMENT This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): Section IV. EXCLUSIONS, Item 16, is deleted in its entirety and replaced with the following: 16. New Pollution Conditions at Divested Property based upon or arising out of any POLLUTION CONDITION on, at, under, or migrating from a COVERED LOCATION or subdivided parcel of a COVERED LOCATION, if the discharge, dispersal, release, seepage, migration, or escape of the POLLUTANTS associated with such POLLUTION CONDITION first commenced after such COVERED LOCATION or subdivided parcel of a COVERED LOCATION is sold, given away, or abandoned by an INSURED, or condemned. All other terms and conditions remain the same. K-31 4851-9173-4762v12/022363-0015 GREATAmERICAN. emaeMernuomsnx ENDORSEMENT# 16 PRE MANUS (09 21) This endorsement, effective 12:01 am.,, forms a part of Policy No. issued to TRI POINTE HOMES HOLDING, INC By Great American E & S Insurance Company THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ON -SITE MATERIALS HANDLING EXCLUSION DURING SITE DEVELOPMENT - COVERAGE B This endorsement modifies insurance provided under the following: PREMISES ENVIRONMENTAL LIABILITY INSURANCE POLICY The INSURED and the Company agree to the following Policy change(s): 1. Solely with regard to Coverage B, Section IV. EXCLUSIONS is amended by the addition of the following: On -Site Contaminated Materials Handling based upon, arising out of, or related to any CONTAMINATED SOIL or HISTORIC FILL MATERIAL that is: (a) excavated or otherwise disturbed and then relocated at, or removed from, the COVERED LOCATION; or (b) encapsulated on, at, or under the COVERED LOCATION, either during the DEVELOPMENT PERIOD or because of SITE DEVELOPMENT. Building Materials based upon, arising out of, or related to any building materials associated with any structure on, at, or under the COVERED LOCATION, including but not limited to piping, caulking, insulation, concrete, electrical and mechanical equipment, drywall, asphalt, foundations, slabs, footings, or pilings, that are removed from the COVERED LOCATION either during the DEVELOPMENT PERIOD or because of SITE DEVELOPMENT. 2. Section II. DEFINITIONS is amended by the addition of the following: CONTAMINATED SOIL means native soil containing, mixed with, or otherwise impacted by, any POLLUTANTS. DEVELOPMENT PERIOD means the period of time beginning on the first day of the POLICY PERIOD and ending on the date that a final, unconditional Use and Occupancy Permit, or similar document is Issued by the applicable government entity for all buildings to be constructed on, or renovated at, the COVERED LOCATION. HISTORIC FILL MATERIAL means any soil or materials, including butnotlimited to bricks, concrete, wood, ash, dredge spoils, and demolition debris, that are not native to the COVERED LOCATION and that were deposited or consolidated on, at, or under the COVERED LOCATION prior to the beginning of the POLICY PERIOD, as well as any POLLUTANTS Impacting that soil or associated with those materials. SITE DEVELOPMENT means: 1, any construction or construction -related activities, including but not limited to geo-technical investigation, soil excavation, site preparation, site grading, dewatering, and demolition; or K-32 4851-9173-476202/022363-0015 GREATAmEjuC41v II10111ANIE iN M 91YMNN9rNRDwmm PRE MANUS (09 21) 2. any pre -construction activities undertaken investigate, remove, dispose of, agate, contain, treat, neutralize, monitor or test for a POLLUTION CONDITION. SITE DEVELOPMENT does not include interior renovations, utility work, or routine repair and maintenance activities undertaken after the DEVELOPMENT PERIOD. All other terms and conditions remain the same. Quote Version 2. Tri Pointe Homes Holding, Inc, 0007051953 34 K-33 4851-9173-4762v12/022363-0015 CLERK'S CERTIFICATE STATE OF CALIFORNIA ) COUNTY OF ORANGE ) ss. CITY OF ANAHEIM ) I, THERESA BASS, City Clerk of the City of Anaheim, do hereby certify that the foregoing is the original Resolution No. 2021-102 adopted at a regular meeting provided by law, of the Anaheim City Council held on the 2nd day of November, 2021 by the following vote of the members thereof: AYES: Mayor Sidhu and Council Members Faessel, Diaz, Ma'ae, Moreno, Valencia and O'Neil NOES: None ABSTAIN: None ABSENT: None IN WITNESS WHEREOF, I have hereunto set my hand this 3rd day of November. 2021. CITY CL RK OF THE CITY OF ANAHEIM (SEAL)