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2005 Centex Homes - Assignment & Assumption Agrmt - Legacy VillasRECORDING REQUESTED BY: WHEN RECORDED MAIL TO: Centex Destination Properties 41-865 Boardwalk, Suite 101 Palm Desert, CA 92211 (Space Above Lin, DOC # 2005-0943064 12/14/2005 08:00n Fee:19.00 Page 1 of S Recorded in Official Records County of Riverside Larry U. Ward Assessor, County Clerk 6 Recorder 11111111111111 I 111111111111111111111111 I 111111111111111 M S U PAGE SVE DA FCOR NOOOR SMF MISC. 'v A(' R L COPY LONG REFUND NCHG EXAPA ASSIGNMENT AND ASSUMPTION AGREEMENT / 7/ THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (the "Assignment") is T LA made and entered into as of November 9 2005, by and between CENTEX HOMES, a Nevada general partnership, dba CENT EX DESTINATION PROPERTIES (the "Developer" or "Assignor") and LEGACY VILLAS AT LA QUINTA HOMEOWNERS' ASSOCIATION, a California nonprofit mutual benefit corporation (the "HOA" or "Assignee"), with reference to the following Recitals. Recitals A. Assignor is the master developer of 44.61 acres of real property located in the City of La Quinta, County of Riverside, State of California (the "Site"), which is legally described in Exhibit "A" attached here. B. Assignor intends to develop the Site with a resort residential master planned Community with 280 resort residential units and associated recreational facilities (collectively, the "Project"). C. Assignor, as "Developer," and the City of La Quinta, a California municipal Corporation ("City"), have entered into that certain Development Agreement dated as of November 20, 2003 and recorded in the Official Records of Riverside County, California on January 1, 2004, as Instrument No. 2004-0009685 (the "Development Agreement"), for purposes of among other things, (i) setting forth a per -unit up front payment schedule for the Developer's payment to the City of certain amounts that the parties agree are designed to compensate the City for (A) the potential loss of anticipated general fund revenues as a result of the use of the Site for a residential resort use rather than as traditional tourist commercial use, such as a "hotel" as that term is defined in Section 9.280.030 of the La Quints Municipal Code ("Hotel")": (B) the uncompensated costs of potential additional public services that the Development Plan will generate, which costs would have been recovered if the Site were to be developed for a traditional tourist commercial use, such as a Hotel; (C) and the potential added wear and tear on the municipal infrastructure which will result from the Development Plan, the costs of which would have been compensated if the Site were to be developed for a traditional tourist commercial use, such as a Hotel; (ii) establishing an on -going obligation of the Project to pay the City certain amounts designed to compensate the City unless and until the Villas within the Project generate specified levels of transient occupancy tax; and (iii) granting Developer a vested right to develop the Site according to the Development Plan, all as more particularly described in the Development Agreement. D. Capitalized terms not defined herein shall have the same meaning as set forth in the Development Agreement. E. In accordance with Section 3.2.1 of the Development Agreement, Developer has Caused the HOA to be established and has recorded certain covenants, conditions and restrictions (the "CC&R') for the Project which, among other things, (i) provide for the HOA's payment of the Fees described in Sections 3.3.3 and 3.3.4 of the Development Agreement, (ii) provides for the HOA's operation of a Rental Tracking System, as described in Section 3.3.6 of the Development Agreement, and (iii) provide for the rental management opportunities to owners of units, as Described in Section 3.3.7 of the Development Agreement. F. This Assignment is being entered into pursuant to Section 3.3.8 of the Development Agreement, which provides that, by causing the establishment of the HOA and Providing for the HOA to be responsible for the matters described in Recital E above, Assignor May assign certain of its rights and obligations under the Development Agreement to the HOA. Accordingly, in accordance with Section 3.3.8 and Section 7.1 of the Development Agreement, Assignor now desires to assign all of its obligations and its right, title, and interest in and to Sections 3.3.3, 3.3.4, 3.3.6 and 3.3.7 of the Development Agreement to Assignee, and Assignee desires to accept such assignment on, and subject to, the terms and conditions set forth in this Assignment. NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agrees as follows: Agreement 1. Assignment. Assignor hereby assigns, conveys, transfers, delivers and delegates to Assignee all of Assignor's right, title, interest, and obligation with respect to Sections 3.3.3, 3.3.4, 3.3.6, and 3.3.7 of the Development Agreement (collectively, the "Assumed Obligations"). 2. Assumption of Obligations. Assignee hereby accepts the foregoing assignment and agrees to assume performance of all terms, covenants and conditions occurring or arising from the Assumed Obligations on or after the date of this Assignment. By acceptance of this Assignment, Assignee hereby agrees to assume all of Assignor's right, title, interest and obligation in and to the Assumed Obligations, and Assignee agrees to timely discharge, perform or cause to be performed and to be bound by all of the liabilities, duties and obligation imposed in connection with the Assumed Obligations from and after the date of this Assignment to the same extent as If Assignee had been the original party thereto. 3. Successors and Assigns. This Assignment shall be binding upon and shall inure to the benefit of the successors and assigns of the respective parties hereto. 2 4. Goveming Law. This Assignment shall be governed by and construed in accordance with the laws of the State of California. 5. Further Assurances. The parties covenant and agree that they will execute such other and further instruments and documents as are or may become necessary or convenient to effectuate and carry out this Assignment. 6. Authority of Signatories to Bind Principals. The persons executing this Assignment on behalf of their respective principals represent that (i) they have been authorized to do so and that they thereby bind the principals to the terms and conditions of this Assignment and (iii) their respective principals are properly and duly organized and existing under the laws of, and permitted to do business in, the State of California. 7. Interpretation. The paragraph headings of this Assignment are for reference and convenience only and are not part of this Assignment. They have no effect upon the construction or interpretation of any part hereof. The provisions of this Assignment shall be construed in a reasonable manner to effect the purposes of the parties and of this Assignment. 8. Counternarts. This Assignment may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which counterparts taken together shall constitute but one and the same instrument. IN WITNESS WHEREOF, this Assignment has been executed by the parties as of the Date set forth above. DEVELOPER: CENTEX HOMES, a Nevada general partnership dba Centex Destination Properties By: Centex Real Estate Corporation a Nevada corporation, managin ner By: Ryan T. Breen Division Controller ASSOCIATION: LEGACY VILLAS AT LA QUINTA HOMEOWNERS ASSOCIATION a California non-profit mutual benefit corporation By: Name: Title: By: Name: Title: Exhibit "A" (Legal Description) That certain real property located in the City of La Quinta, County of Riverside, State of California, described as follows: Parcel 1 of Lot 6 Line Adjustment No. 2001-361, recorded on October 23, 2001, as Document No. 2001-515074.