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Koenig/Ralphs Shopping Center OPA 93OWNER PARTICIPATION AGREEMENT IMPOSING COVENANTS AFFECTING REAL PROPERTY by and between LA QUINTA REDEVELOPMENT AGENCY, and KOENIG COMPANIES Agency Participant TABLE OF CONTENTS I. [§100] SUBJECT OF AGREEMENT .............................. A. [§ 101 ] Purpose of Agreement .............................. B. [§102] The Redevelopment Plan ............................. C. [§103] The Site ....................................... D. [§104] Parties to the Agreement ............................. 1. [§105] The Agency ................................ 2. [§106] The Participant .............................. 3. [§107] Prohibition Against Change in Ownership, Management and Control of Participant, Transfer of the Site or Improvements, and Assignment of Agreement ........... 1 1 1 1 1 1 2 2 II. [§200] AGENCY PARTICIPATION .............................. 4 A. [§201] Agency Consideration For Covenants Affecting Real Property ...... 4 B. [§202] Recordation of Documents ............................ 4 III.. [§300] DEVELOPMENT OF THE SITE ............................ 4 A. [§301] Development of the Site by the Participant .................. 4 1. [§302] Development of the Site ........................ 4 2. [§303] Cost of Construction .......................... 5 3. [§304] Construction Schedule .......................... 5 4. [§305] Bodily Injury and Property Damage Insurance ............ 5 5. [§306] City and Other Governmental Agency. Permits ........... 6 6. [§307] Rights of Access ............................. 6 7. [§308] Local, State and Federal Laws .................... 7 8. [§309] Non-discrimination During Construction .............. 7 B. [§310] Taxes, Assessments, Encumbrances and Liens ............... 7 C. [§311] Certificate of Completion ............................ 7 IV. [§400] USE OF THE PROPERTY ............................... 8 A. [§401] Uses. [Subject to negotiation and consultation with Agency.] ...... 8 B. [§402] Reciprocal Access Requirements ........................ 8 C. [§403] Maintenance of the Site ............................. 8 D. [§404] Rights of Access .................................. 9 E. [§405] Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction ....................... 9 F. [§406] Non-discrimination After Completion of Improvements .......... 9 V. [§500] DEFAULTS AND REMEDIES ............................ 11 A. [§501] Defaults --General ................................ 11 B. [§502] Legal Actions .................................. 12 1. [§503] Institution of Legal Actions ..................... 12 2. [§504] Applicable Law ............................. 12 3. [§505] Acceptance of Service of Process .................. 12 PUBL:9786_111871B2588.0 C. [§506] Rights and Remedies Are Cumulative .................... D. [§507] Inaction Not a Waiver of Default ...................... E. [§508] Remedies upon Default ............................. 1. [§509] Damages . ................................ 2. [§510] Specific Performance ......................... 3. [§511] Termination by the Participant ................... 4. [§512] Termination by the Agency ..................... VI. [§600] GENERAL PROVISIONS ............................... A. [§601] Notices, Demands and Communications Between the Parties ...... B. [§602] Conflicts of Interest ............................... C. [§603] Enforced Delay; Extension of Times of Performance .......... D. [§604] Nonliability of Officials and Employees of the Agency ......... E. [§605] Amendments to this Agreement ....................... F. [§607] Time of Essence ... ........................... . G. [§608] Attorneys' Fees .................................. VII. [§700] ENTIRE AGREEMENT, WAIVERS ........................ VIII. [§800] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY ........ ATTACHMENTS Attachment No. 1 Site Map Attachment No. 2 Legal Description Attachment No. 3 Scope of Development Attachment No. 4 Schedule of Performance Attachment No. 5 Agreement Regarding Covenants to Develop, Use and Maintain the Site Attachment No. 6 Certificate of Completion 12 12 12 12 13 13 13 14 14 14 14 14 14 15 15 15 15 PUBL:9786_111871B2588.0 H OWNER PARTICIPATION AGREEMENT THIS OWNER PARTICIPATION AGREEMENT (the "Agreement") is entered into by and between the LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic (the "Agency"), and KOENIG COMPANIES, a California general partnership (the "Participant"). The Agency and the Participant hereby agree as follows: I. [§100] SUBJECT OF AGREEMENT A. [§ 101 ] Purpose of Agreement The purpose of this Agreement is to effectuate the Redevelopment Plan (as hereinafter defined) for the La Quinta Redevelopment Project Area No. 1 (the "Project") by providing for the development of certain property situated within the Project Area of the Project (the "Project Area") as a grocery retail center. That portion of the Project Area to be developed pursuant to this Agreement (the "Site") is depicted on the "Site Map", which is attached hereto as Attachment No. 1 and incorporated herein by reference. This Agreement is entered into for the purpose of developing such a grocery retail center on the Site and not for speculation in land holding. Completing the development of the Site pursuant to this Agreement is in the vital and best interest of the City of La Quinta, California (the "City") and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements under which the Project has been undertaken. B. [§102] The Redevelopment Plan The Redevelopment Plan for the La Quints Redevelopment Project Area No. 1 was approved and adopted by the City Council of the City of La Quinta by Ordinance No. 43 on November 29, 1983; said ordinance and the Redevelopment Plan as so approved (the "Redevelopment Plan") are incorporated herein by reference. C. [§103] The Sit The Site consists of one (1) parcel of real property located at the northwest corner of Washington Street and Calle Tampico. The Site shall be all or a portion of the area included within the "Legal Description" which is attached hereto as Attachment No. 2 and incorporated herein by reference. D. [§104] Parties to the Agreement 1. [§105] The Agency The Agency is a public body, corporate and politic, exercising governmental functions and powers and organized and existing under Chapter 2 of the Community Redevelopment Law of the State of California. The principal office and mailing address of the Agency is 78-495 Calle Tampico, La Quinta, California 92253. PusL:9786_111871B2588.0 "Agency", as used in this Agreement, includes the La Quinta Redevelopment Agency, and any assignee of or successor to its rights, powers and responsibilities. Any action or approval of the Agency required hereunder may be taken or given by the Agency Executive Director or his or her designee, when specifically provided herein. 2. [§106] The Participant The Participant is Koenig Companies, a California corporation. The President is John W. Koenig. The Participant has represented to the Agency that the Participant has the experience and qualifications necessary to perform the obligations of Participant pursuant to this Agreement. The principal office of the Participant is 2601 Airport Drive, Suite 240, Torrance, California 90505. By executing this Agreement, each person signing on behalf of the Participant warrants and represents to the Agency that the Participant is duly formed and operating in compliance with all applicable laws, that the Participant has the full power and authority to enter into this Agreement, that all authorizations required to make this Agreement binding upon the Participant have been obtained, and that the persons executing this Agreement on behalf of the Participant are fully authorized to do so. 3. [§107] Prohibition Against Change in Ownership. Management and Control of Participant. Transfer of the Site or Improvements. and Assignment of Agreement (a) Prohibition. The qualifications and identity of the Participant as a developer and operator of a grocery retail center are of particular concern to the City and the Agency. It is because of those qualifications and identity that the Agency has entered into this Agreement with the Participant. Until the issuance of a Certificate of Completion pursuant to Section 313 herein, no voluntary or involuntary successor in interest of the Participant shall acquire any rights or powers under this Agreement, nor shall Participant make any total or partial sale, transfer, conveyance, assignment or lease of the whole or any part of the Site or the improvements thereon without prior written approval of the Agency, except as expressly set forth herein. (b) Permitted Transfers. Notwithstanding any other provision of this Agreement to the contrary, prior to expiration of the Term (as that term is defined in Section 401 hereof), Agency approval of an assignment of this Agreement or conveyance of the Site or improvements, or any part thereof, shall not be required in connection with any of the following: (i) Any transfers to an entity or entities in which the Participant retains a minimum of fifty-one percent (51 %) of the ownership or beneficial interest and retains management and control of operations of the transferee entity or entities. (ii) Transfers resulting from the death or mental or physical incapacity of an individual partner of Participant. KML:9786 111871 B2588.0 2 (iii) The conveyance or dedication of any portion of the Site to the City or other appropriate governmental agency, or the granting of easements or permits to facilitate construction of the improvements (as defined herein). (iv) Any requested assignment for a mortgage or deed of trust on the Site for financing purposes, including, without limitation, the grant of a deed of trust to secure the funds necessary for construction and thereafter permanent financing or refinancing of the Site acquisition and improvements. (v) Transfers or assignments in trust for the benefit of a spouse, children, grandchildren or other family members. (vi) Leases to tenants. (vii) Transfers of stock in publicly traded companies or beneficial interest in publicly held partnerships or real estate investment trust ("REIT"). In the event of an assignment by Participant under subparagraphs (i) through (v), inclusive, above not requiring the Agency's prior approval, Participant nevertheless agrees that at least thirty (30) days prior to such assignment it shall give written notice to Agency of such assignment. (c) Agency Consideration of Requested Transfer. The Agency agrees that it will not unreasonably withhold approval of a request to assign or transfer made pursuant to this Section 107, provided the Participant delivers written notice to the Agency requesting such approval. Such notice shall be accompanied by evidence regarding the proposed assignee's or transferee's retail qualifications and experience, projected taxable sales volume and its financial commitments and resources sufficient to enable the Agency to evaluate the proposed assignee or purchaser pursuant to the criteria set forth in this Section 107 and other criteria as reasonably determined by the Agency. The Agency shall evaluate each proposed transferee or assignee on the basis of its development and/or retail qualifications and experience and may reasonably disapprove any proposed transferee which the Agency determines lacks the qualifications and experience necessary for development of the improvements described in the Scope of Development attached hereto as Attachment No. 3 and incorporated herein by this reference. It shall also be reasonable for the Agency to disapprove an assignee or transferee if the primary use of the facility will be other than a use which is complimentary to the grocery retail center. Within thirty (30) days after the receipt of the Participant's written notice requesting Agency approval of an assignment or transfer pursuant to this Section 107, the Agency shall respond in writing by stating what further information, if any, the Agency reasonably requires in order to determine the request complete and determine whether or not to grant the requested approval. Upon receipt of such a response, the Participant shall promptly furnish to the Agency such further information as may be reasonably requested. (d) Successors and Assigns. All of the terms, covenants and conditions of this Agreement shall be binding upon the Participant and the permitted successors and assigns of the Participant. Whenever the term "Participant" is used in this Agreement, such term shall include any other permitted successors and assigns as herein provided. nmL:9786_111871 B2588.0 3 (e) Termination of Restrictions. The restrictions of this Section 107 shall terminate and be of no further force and effect after the issuance of a Certificate of Completion for the improvements pursuant to Section 311. II. [§200] AGENCY PARTICIPATION A. [§201] Agency Consideration For Covenants Affecting Real Property 1. Purpose. The primary purpose of this Agreement is for the Participant to covenant to develop, use, and maintain the Site as a grocery retail center in accordance with all the covenants and restrictions in this Agreement, the Redevelopment Plan and current zoning and general plan designations. In return for the Participant's covenants, the Agency shall provide financial incentives to aid in the Participant's performance as provided in this Section 201. 2. Agency Assistance. Agency agrees to pay the cost attributable to Participant for each of the following: (i) twenty-five percent (25 %) of the cost of share of traffic signal located at the intersection of Washington and Tampico; (ii) fifty percent (50%) of the cost of the traffic signal 550 feet west of Washington Street; and (iii) fifty percent (50%) of the cost of the traffic signal approximately 750 feet north of Calle Tampico. 3. Indemnification for Third -Party Claims. Participant shall hold harmless, indemnify and defend Agency for any cause of action or claim asserted against Agency or City, including a claim for injunctive relief, by a third party arising out of or relating to the validity or enforceability of this Agreement or the condition of the Site, including, but not limited to, any environmental or hazardous waste clean-up requirement or claim pursuant to any state or federal law. B. [§202] Recordation of Documents Prior to the issuance of the Certificate of Completion and prior to the payment of any Agency Assistance, the Agreement Regarding Covenants to Develop, Use and Maintain the Site attached hereto as Attachment No. 5 and incorporated herein by this reference shall be recorded against the Site. III.. [§300] DEVELOPMENT OF THE SITE A. [§301] Development of the Site by the Participant 1. [§302] Development of the Site The Site shall be developed in accordance with the Scope of Development (Attachment No. 3), including any applicable mitigation measures. The development shall include all improvements depicted on any plans and specifications submitted to and approved by City, and shall incorporate or show compliance with all applicable condition of approval and mitigation measures. PUBL:9786_11187IB2588.0 4 2. [§303] Cost of Construction The Participant, at the Participant's sole cost and expense, shall construct or cause the construction of all of the improvements and on -site public improvements to be constructed pursuant to this Agreement and the Scope of Development (Attachment No. 3). Additionally, the Participant shall pay for hazardous site remediation and for the demolition and removal of any subsurface improvements and existing buildings or improvements, if any, on the Site prior to the commencement of construction of the improvements. 3. [§304] Construction Schedule The Participant shall cause the commencement and completion of the improvements by the respective times set out in the Schedule of Performance (Attachment No. 4). For the purposes of this Agreement, to "commence" or "begin" construction means completion of grading and commencement of the foundations. If Participant fails to commence or complete construction within such time periods, but Participant has obtained financing for the improvements pursuant to Section 303 hereof and if Participant can otherwise demonstrate to the Agency's satisfaction that it is able to perform its obligations in conformance with this Agreement (such ability to proceed to be determined by the Agency in its sole and absolute discretion), then the Agency Executive Director may in his or her reasonable discretion provide the Participant with written notice of the Agency's approval to begin or complete construction of the improvements at a later time. 4. [§305] Bodilyjury and Property Damage Insurance The Participant shall defend, assume all responsibility for and hold the Agency and the City, and their officers, representatives, agents and employees, harmless from, all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorneys fees and costs), which may be caused by any of the Participant's acts, omissions, failures to act or other activities under this Agreement, whether such activities or performance thereof be by the Participant or anyone directly or indirectly employed or contracted with by the Participant and whether such damage shall accrue or be discovered before or after termination of this Agreement. The Participant shall take out and maintain or cause to be taken out and maintained a comprehensive liability policy in the amount of One Million Dollars ($1,000,000) combined single limit policy, including contractual liability, which shall protect the Participant, City and Agency and their respective officers, representatives, employees and agents from claims, losses or damages for any claims arising out of acts or omissions occurring from the date of this Agreement up to and including the date of the issuance of a Certificate of Completion for the improvements in connection with Participant's activities hereunder. The Participant shall furnish a certificate of insurance countersigned by an authorized agent of the insurance carrier on a form of the insurance carrier setting forth the general provisions of the insurance coverage which shall be in conformance with this Section 305. This countersigned certificate shall name the City and the Agency and their officers, employees, agents and representatives as additional insureds under the policy. The PU13L:9786_111871B2588.0 5 certificate by the insurance carrier shall contain a statement of obligation on the part of the carrier to notify City and the Agency of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by the Participant shall be primary insurance and not contributing with any insurance maintained by the Agency or City, and the policy shall contain such an endorsement. The insurance policy or the certificate of insurance shall contain a waiver of subrogation for the benefit of the City and the Agency. The required certificate shall be furnished by the Participant at the time set forth therefor in the Schedule of Performance (Attachment No. 4). The Participant shall also furnish or cause to be furnished to the Agency evidence satisfactory to the Agency that any contractor with whom it has contracted for the performance of work on the Site or otherwise pursuant to this Agreement carries workers' compensation insurance as required by law. The Participant's obligation to maintain insurance as set forth in this Section 305 shall remain in effect only until (i) a Certificate of Completion has been furnished for the improvements as hereafter provided in Section 311 of this Agreement if the policy is on an "occurrence" basis and (ii) two (2) years following issuance of a Certificate of Completion for the improvements if the policy is on a "claims made" basis. 5. [§306] City and Other Governmental Agency Permits Prior to the commencement of construction of the improvements, the Participant shall secure or cause to be secured any and all permits which may be required by the City or any other governmental agency affected by or with jurisdiction over such construction. 6. [§307] Rights of Access For the purpose of assuring compliance with this Agreement, representatives of the Agency and the City shall have the right of access to all portions of the Site, without charges or fees, at normal construction hours for the purposes of this Agreement, including, but not limited to, the inspection of the work being performed in constructing the improvements, so long as they comply with all generally applicable safety rules. Such representatives of the Agency or of the City shall be those who are so identified in writing by the Executive Director of the Agency. The Agency shall hold the Participant harmless from any bodily injury or related damages arising out of the activities of the Agency and the City as referred to in this Section 307. The Participant and the Agency agree to cooperate in placing and maintaining on the Site one sign indicating the respective parts of the Participant and the Agency in the construction of the improvements. The cost of the sign shall be borne solely by the Participant. All such signs required under this Section 307 are subject to City ordinances and approvals. rusL:9786_1 1 187 1 B2588.0 6 7. [§308] Local. State and Federal Laws The Participant shall carry out the construction of the improvements in conformity with all applicable laws, including all applicable federal and state labor standards, provided, however, Participant and its contractors, successors, assigns, transferees and lessees do not waive their rights to contest any such laws, rules or standards. 8. [§309] Non-discrimination During Construction The Participant, for itself and its successors and assigns, agrees that in the construction of the improvements, the Participant will not discriminate against any employee or applicant for employment because of race, color, creed, religion, sex, marital status, national origin or ancestry. B. [§310] Taxes. Assessments. Encumbrances and Liens The Participant shall pay when due all ad valorem taxes and assessments on the Site. Prior to issuance of the Certificate of Completion pursuant to Section 311, the Participant shall not place on the Site, or any part thereof, any mortgage, trust deed, encumbrance or lien other than as expressly allowed by this Agreement. The Participant shall remove or have removed any levy or attachment made on any of the Site or any part thereof, or assure the satisfaction thereof within a reasonable time but in any event prior to a sale thereunder. The holder of any mortgage or deed of trust authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct or complete the improvements or to guarantee such construction or completion; nor shall any covenant or any other provision in the deed for the Site be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. C. [§311] Certificate of Completion After completion of all construction and development required by this Agreement to be completed by the Participant upon the Site in conformity with this Agreement, the Agency shall furnish the Participant with a Certificate of Completion within thirty (30) days of written request therefor by the Participant. The Agency shall not unreasonably withhold the Certificate of Completion. The Certificate of Completion shall be a conclusive determination of satisfactory completion of the construction of the improvements required by this Agreement upon the Site and the Certificate of Completion shall so state. The Certificate of Completion shall be in such form as to permit it to be recorded in the Recorder's Office of Riverside County and shall be in substantially the form of Attachment No. 6 hereto and incorporated herein by reference. After recordation of the Certificate of Completion, all of the conditions, terms and covenants contained in this Agreement shall remain in full force and effect, except as provided otherwise herein. If the Agency refuses or fails to fiirmsh the Certificate of Completion described above after written request from the Participant, the Agency shall, within thirty (30) days of written request therefor, provide the Participant with a written statement of the reasons the PUBL:9786_111871B2588.0 7 Agency refused or failed to furnish such Certificate of Completion. The statement shall also contain Agency's opinion of the actions that the Participant must take to obtain a Certificate of Completion. If the reason for such refusal is confined to the immediate availability of specific items of materials for landscaping or minor "punch list" items, the Agency may in its reasonable discretion issue such Certificate of Completion upon the posting of a bond or an unconditional letter of credit (in form and substance reasonably acceptable to the Agency and its legal counsel) by the Participant with the Agency in an amount representing the fair value of the work not yet completed. The Certificate of Completion described herein shall not constitute evidence of compliance with or satisfaction of any obligation of the Participant to any holder of any mortgage, any insurer of a mortgage securing money loaned to finance the improvements or any part thereof. The Certificate of Completion issued pursuant to this Section 311 is not notice of completion as referred to in California Civil Code Section 3093. IV. [§400] USE OF THE PROPERTY A. [§401] Uses The Participant covenants and agrees for itself, its successors, its assigns, and every successor in interest to the Site or any part thereof, that upon completion of construction and thereafter, until the expiration date of the Redevelopment Plan, the Participant, such successors and such assignees, shall not maintain, use or operate the Site as anything other than a retail center in accordance with the provisions of this Section 401, the Redevelopment Plan, the Agreement Regarding Covenants to Develop, Use and Maintain the Site (Attachment No. 5) and this Agreement. No use or operations other than the above -described use shall be allowed on the Site without the prior written approval of the Agency (which approval the Agency may grant or deny at its sole discretion) until the expiration date of the Redevelopment Plan. The covenants established in this Section 401 shall, without regard to technical classification and designation, be binding for the benefit and in favor of the Agency, its successors and assigns, the City and any successor in interest to the Site or any part thereof. B. [§402] Reciprocal Access Requirements Participant shall require reciprocal easement rights with respect to the retail uses within the Site to allow for shared parking, access and circulation on the Site, and which specifies the allocation of responsibility for performing and paying for maintenance responsibilities and costs for each tenant's parking areas and access roads. C. [§403] Maintenance of the Site The Participant covenants and agrees to maintain the improvements, in good condition conforming to all applicable local laws, and shall keep the Site free from any accumulation of debris or waste materials. The Participant shall also maintain the landscaping required to be planted on the Site in a healthy condition in accordance with the approved landscape plan. To insure Participant's continued maintenance of the improvements required in PUBL:9786_111871 B2588.0 . 8 this Agreement, Participant agrees to execute the Agreement Regarding Covenants to Develop, Use and Maintain the Site (Attachment No. 5).. Issuance of a Certificate of Completion by the Agency shall not affect Participant's obligations under this section. D. [§404] Rights of Access After completion of the improvements, the Agency, for itself and for the City and other public agencies, at their sole risk and expense, reserves the right to enter the Site or any part thereof at all reasonable times upon not less than twenty-four (24) hours' prior notice except in emergency situations, and upon the consent of the Participant, for the purpose of construction, reconstruction, maintenance, repair or service of any public improvements or public facilities located on the Site. The Participant agrees to cooperate with the Agency to make the Site available for the Agency's access and inspection, and agrees and acknowledges that if for any reason the Agency is unable to obtain the Participant's consent to such access the Agency may obtain an administrative inspection warrant or other appropriate legal or equitable order or remedy to obtain entry to the Site and/or improvements. Agency shall indemnify and hold Participant harmless from any costs, claims, damages or liabilities pertaining to any entry, and shall promptly repair and restore any damage to the Site made as a result of such entry. E. [§405] Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction The covenants established in this Agreement and the Agreement Regarding Covenants to Develop, Use and Maintain the Site (Attachment No. 5) shall, without regard to technical classification and designation, be binding for the benefit and in favor of the Agency, its successors and assigns, as to those covenants which are for its benefit. The covenants contained in Sections 401 through 404 inclusive, of this Agreement shall -remain in effect until the termination date of the Redevelopment Plan, and the covenants against discrimination contained in Section 406 herein shall remain in effect in perpetuity. The Agency is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. The Agreement and the covenants shall run in favor of the Agency, without regard to whether the Agency has been, remains or is an owner of any land or interest therein in the Site or in the Project Area. The Agency shall have the right, if the Agreement or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and the covenants may be entitled. F. [§406] Non-discrimination After Completion of Improvements The Participant covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site or the improvements, nor shall the Participant itself or any person claiming under or through it establish or permit any such MBL:9786_111871 M588.0 9 practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site or the improvements. The foregoing covenants shall run with the land and shall remain in effect in perpetuity. The Participant shall refrain from restricting the rental, sale or lease of the Site or the improvements on the basis of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following non-discrimination or nonsegregation clauses: 1. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." 2. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under, or through him or her, and this lease is made and accepted upon and subject- to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." 3. In contracts: "There shall be no discrimination against, or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." PUBL:9786_1 1 1871B2588.0 10 The foregoing covenants regarding discrimination shall run with the land and shall remain in effect in perpetuity. V. [§500] DEFAULTS AND REMEDIES A. [§501] Defaults --General Subject to the extensions of time set forth in Section 603, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. A party claiming a default (claimant) shall give written notice of default to the other party, specifying the nature of the default complained of and referencing the appropriate section(s) of this Agreement under which such default arises. Except as may be required to protect against irreparable injury, the claimant shall not institute proceedings against the other party if the other party, within thirty (30) days from receipt of such notice, immediately, with due diligence, commences to cure, correct or remedy such failure or delay and shall complete such cure, correction or remedy within thirty (30) days from the date of receipt of such notice or if the cure cannot reasonably be completed within thirty (30) days, that the cure has been commenced and is diligently pursued to completion. With respect to any mortgage or deed of trust granted by Developer as provided herein, whenever the Agency shall deliver any notice or demand to Developer with respect to any breach or default by the Developer hereunder, the Agency shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand, provided that such holder has requested such notice by a separate writing received by the Agency. No notice of default shall be effective as to the holder unless such notice is given. Each such holder shall (insofar as the rights of the Agency are concerned) have the right, at its option, within thirty (30) days after the receipt of the notice, to cure or remedy or commence to cure or remedy any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage. In the event possession of the Site (or portion thereof) is required to effectuate such cure or remedy, the holder shall be deemed to have timely cured or remedied if it commences the proceedings necessary to obtain possession thereof within thirty (30) days, diligently pursues such proceedings to completion, and, after obtaining possession, diligently completes such cure or remedy. 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 (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed the Developer's obligations to the Agency by written agreement reasonably satisfactory to the Agency's legal counsel. Any such holder properly completing such Developer improvements shall be entitled, upon compliance with the requirements of Section 311 of this Agreement, to a Certificate of Completion (as therein defined). KML:9786 111871 B2588.0 11 B. [§502] Legal Actions 1. [§503] Institution of Legal Actions In addition to any other rights or remedies, and subject to the restrictions in Section 501, either party may institute legal action 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 Riverside, State of California, in an appropriate municipal court in that county, or in the Federal District Court in the Central District of California. 2. [§504] Anulicable Law The laws of the State of California shall govern the interpretation and enforcement of this Agreement. 3. [§505] Acceptance of Service of Process In the event that any legal action is commenced by the Participant against the Agency, service of process on the Agency shall be made by personal service upon the Executive Director or in such other manner as may be provided by law. In the event that any legal action is commenced by the Agency against the Participant, service of process on the Participant shall be made by personal service on John W. Koenig or any partner of the Participant, whether made within or without the State of California, or in such other manner as may be provided by law. C. [§506] 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 material default or any other material default by the other party. D. [§507] 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. E. [§508] Remedies upon Default 1. [§509] Dom. If either party defaults with regard to any of the provisions of this Agreement, the non -defaulting party shall serve written notice of such default upon the defaulting party in the manner provided in Section 501 hereof. If the default is not cured or commenced to PUBL:9786_1 1 187 1 B2588.0 12 be cured by the defaulting party within the applicable time period, the defaulting party shall be liable to the other party for any damages caused by such default. 2. [§510] Specific Performance If either party defaults with regard to any of the provisions of this Agreement, the non -defaulting party shall serve written notice of such default upon the defaulting parry in the manner provided in Section 501 hereof. If the default is not cured by the defaulting party within the applicable time period, the non -defaulting party at its option may thereafter (but not before) commence an action for specific performance of the terms of this Agreement. 3. [§511] Termination by the Participant In the event that Participant is unable to obtain satisfactory financing, tenant commitments, or it reasonably determines that the project is financially infeasible, or in the event the Agency does not make payment of Agency Assistance in the manner and condition and by the date provided in this Agreement, and any such failure shall not be cured within the applicable time period after written demand by the Participant, then this Agreement may, at the option of the Participant, be terminated by written notice thereof to the Agency. 4. [§512] Termination by the Agency Subject to the notice and opportunity to cure requirements of Section 501 hereof, in the event that prior to the expiration of the Term: (a) The Participant (or any successor in interest) assigns the Agreement or any rights therein or in the Site in violation of this Agreement; or (b) There is a change in the ownership of the Participant contrary to the provisions of Section 107 hereof; or (c) The Participant fails to obtain a Certificate of Completion for the improvements as provided in Section 311 hereof by the date set forth in the Schedule of Performance (Attachment No. 4); or (d) The Participant is otherwise in default of this Agreement; then this Agreement and any rights of the Participant or any assignee or transferee in the Agreement, or arising therefrom with respect to the Agency or the Site, shall, at the option of the Agency, be terminated by the Agency. From the date of the written notice of termination of this Agreement by the Agency to the Participant and thereafter this Agreement shall be deemed terminated and there shall be no further rights or obligations between the parties. PusL:9786_1 1 is71s2sss.o 13 VI. [§600] GENERAL PROVISIONS Written notices, demands and communications between the Agency and the Participant shall be sufficiently given if delivered by hand, sent by overnight delivery service or telecopy, or dispatched by registered or certified mail, postage prepaid, return receipt requested, to the principal offices of the Agency and the Participant. 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 501. B. [§602] Conflicts of Interest No member, official or employee of the Agency shall have any personal interest, direct or indirect, in this Agreement, nor shall any member, official or employee participate in any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is directly or indirectly interested. The Participant warrants that it has not paid or given, and will not pay or give, any third party any money or other consideration for obtaining this Agreement. C. [§603] Enforced Delay: 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 or defaults are due to: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack of transportation; inability to secure any necessary labor, materials or tools; delays of any contractor, subcontractor or supplier; governmental restrictions or priority; litigation; inclement weather; acts or omissions of the other party; or any other causes beyond the control or without the fault of the party claiming an extension of time to perform. Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement or discovery of the cause. D. [§604] Nonliability of Officials and Employees of the Agency No member, official or employee of the Agency or the City shall be personally liable to the Participant, or any successor in interest, in the event of any default or breach by the Agency (or the City) or for any amount which may become due to the Participant or its successors, or on any obligations under the terms of this Agreement. E. [§605] Amendments to this Agreement Participant and Agency agree to mutually consider reasonable requests for amendments to this Agreement which may be made by lending institutions, or Agency's counsel MBL:9786_11187182588.0 .14 or financial consultants, provided said requests are consistent with this Agreement and would not substantially alter the basic business terms included herein. F. [§607] Time of Essence It is understood and expressly agreed that time is of the essence for the performance of each and every covenant, condition and obligation of this Agreement. G. [§608] AttornCys' Fees If any attorney is engaged by Agency to enforce or defend any provision of this Agreement as a consequence of any default by the Participant under this Agreement, Participant shall pay to Agency, immediately upon demand, the amount of all attorneys' fees and costs incurred by Agency in connection therewith. In the event of any dispute between the parties hereto arising out of the subject matter of this Agreement, the prevailing party shall be entitled to recover reasonable expenses, attorneys' fees and costs. VII. [§700] ENTIRE AGREEMENT, WAIVERS This Agreement is executed in four (4) duplicate originals, each of which is deemed to be an original. This Agreement includes pages 1 through _ and Attachments 1 through 6, which constitutes the entire understanding and agreement of the parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties or their predecessors in interest with respect to all or any part of the subject matter hereof. All waivers of the provisions of this Agreement must be in writing by the appropriate authorities of the Agency and the Participant, and all amendments hereto must be in writing by the appropriate authorities of the Agency and the Participant. In any circumstance where under this Agreement any party is required to approve or disapprove any matter, approval shall not be unreasonably withheld, conditioned or delayed. VIII. [§800] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY Participant shall execute and deliver four (4) copies of this Agreement to the Agency. The Agency must authorize, execute and deliver at least one (1) copy of this Agreement to Participant on or before forty-five (45) days after the execution and delivery of this Agreement by Participant or this Agreement shall be void, except to the extent that the Participant shall consent in writing to a further extension of time for the authorization and delivery of this Agreement. The effective date of this Agreement shall be the date when it shall have been approved by the Agency. PUBL:9796_111871$2588.0 15 IN WITNESS WHEREOF, the Agency and the Participant have signed this Agreement on the respective dates set forth below. DATED: / z 2 / f 3 A ST: ecretary APPRO -ED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel Dated: LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic n 1,95ttI/1 "'"'� �S "AGENCY" KOENIG COMPANIES "PARTICIPANT" PUBL:9786_1 1 187 1 B2588.0 16 ATTACHMENT NO. 1 SITE MAP [To Be Inserted] PUBL:9786_111871B2588.0 1-1 ATTACIDdENT NO. 2 LEGAL DESCRIPTION OF SITE That land situated in the State of California, County of Riverside, City of La Quinta, described as follows: PUBL:9786_111871B2588.0 2-1 ATTACHMENT NO. 3 SCOPE OF DEVELOPMENT Scope of development is to be consistent with the conditions of that certain Plot Plan 91- 456 approved by the City Council after a noticed public hearing on April 16, 1991 and any amendments thereto. PUBL:9786_111871B2588.0 3-1 ATTACHMENT NO. 4 SCHEDULE OF PERFORMANCE 1. Execution of Agreement by Agency. The Agency shall execute this Agreement, and if approved, shall deliver one (1) executed copy thereof to the Participant. 2. Commencement of Construction. Participant shall commence construction of the improvements. I Completion of Construction. Participant shall complete construction of the improvements 4. Recordation of Agreement Regard- ing Covenants (Attachment No. 5). Record Agreement Regarding Covenants. 5. Record Certificate of Completion. Obtain a certificate of occupancy and Certificate of Completion for the improvements. Within forty-five (45) days after Participant's delivery to Agency of four (4) executed copies of the Agreement. By April 1, 1995. Within 12 months after the commencement of construction; but not later than April 1, 1996. Prior to obtaining a Certificate of Completion. Prior to obtaining Agency Assistance. PusL:9786_11187 1 B2588.0 4-1 ATTACHMENT NO. 5 AGREEMENT REGARDING COVENANTS TO DEVELOP, USE AND MAINTAIN THE SITE RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO ) AND MAIL TAX STATEMENTS TO: ) La Quinta Redevelopment Agency ) 78-495 Calle Tampico ) La Quinta, California 92253 ) Attention: Executive Director ) [Space above for Recorder.] This document is exempt from the payment of a recording fee pursuant to Government Code Section 6103. Signature of declarant or agent determining tax and exempt from recording fee AGREEMENT REGARDING COVENANTS TO DEVELOP, USE AND MAINTAIN THIS AGREEMENT REGARDING COVENANTS TO DEVELOP, USE AND MAINTAIN (the "Agreement") is hereby entered into by and between the CITY OF LA QUINTA, California municipal corporation (the "City"), the LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic (the "Agency"), and KOENIG COMPANIES, a California corporation, as of the day of , 199_. RE.Q11ALa A. The Agency and the Participant have entered into an Owner Participation Agreement Imposing Covenants Affecting Real Property ("OPA") on , 1993, for the development of a grocery retail center located on certain real property located in the La Quinta Redevelopment Project Area No. 1, which is more particularly and legally described on Exhibit "A" attached hereto and made a part hereof (the "Site"). The OPA is a public record available for public inspection at the offices of the City Clerk of the City of La Quinta, whose address is 78-495 Calle Tampico, La Quinta, California 92253. The OPA requires that Participant shall execute, and shall develop, use and maintain the improvements and the landscaping on the Site in accordance with, this Agreement. PuBL:9786_111871B2588.0 5-1 B. The City, the Agency, and the Participant desire to set forth herein their respective rights and obligations and the maintenance standards (including without limitation the definition of "City Standards") concerning the development, use and maintenance of all the improvements on site. NOW, THEREFORE, THE PARTIES MUTUALLY AGREE AS FOLLOWS: I. [§ 1001 PURPOSE OF THIS AGREEMENT The purpose of this Agreement is to set forth general development, use, operation and maintenance standards and obligations of Participant in its maintenance of the improvements on and within the Site. II. [§ 2001 PARTIES TO THE AGREEMENT The City of La Quinta is a municipal corporation. The "City" as used in this Agreement includes the City of La Quinta and any assignee of or successor to its rights, powers, and responsibilities. The La Quinta Redevelopment Agency is a public body corporate and politic of the State of California. The "Agency" as used in this Agreement includes the La Quinta Redevelopment Agency and any assignee of or successor to its rights, powers and responsibilities. III. [§ 3001 REPRESENTATIVES OF THE PARTIES AND SERVICE OF NOTICES The representatives of the respective parties who are authorized to administer this Agreement and to whom formal notices, demands and communications shall be given are as follows: City and Agency: La Quinta Redevelopment Agency 78-495 Calle Tampico La Quinta, California 92253 Attn.: Executive Director Participant: Koenig Companies 2601 Airport Drive, Suite 240 Torrance, California 90505 Attn.: John W. Koenig Formal notices, demands and communications to be given hereunder by any party shall be made in writing and may be effected by personal delivery, telecopy, overnight delivery service or by registered or certified mail, postage prepaid, return receipt requested. IV. [§ 4001 COMPLIANCE WITH REDEVELOPMENT PLAN AND USE NON- DISCRIMINATION COVENANTS PUBL:9786_1 1 187 1 B2588.0 5-2 Use Covenant. The Participant covenants and agrees for itself, its successors, its assigns and every successor in interest to the Site, or any part thereof, that during the term, said Participant; successors and assigns shall [not] maintain, use [and/or] operate the Site [for any purpose other than] as a grocery retail center in accordance with the OPA, the Redevelopment Plan and this Agreement. [No use or operations other than the above -described use shall be allowed on the Site without the prior written approval of the Agency (which approval the Agency may grant or deny at its sole discretion) until the expiration of the Term.] [Nothing contained herein or elsewhere in this Agreement shall be deemed or construed as a covenant to operate.] Non-discrimination After Completion of Improvements. The Participant covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site or the improvements, nor shall the Participant itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site or the improvements. The foregoing covenants shall run with the land and shall remain in effect in perpetuity. The Participant shall refrain from restricting the rental, sale or lease of the Site or the improvements on the basis of race, color, creed, religion, sex, marital status, handicap, national origin or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following non-discrimination or nonsegregation clauses: a. In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons -claiming under or through them, that there shall be, no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." b. In leases: "The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of PUBL:9786-1 1 187 1 B2588.0 5-3 discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the premises herein leased." C. In contracts: "There shall be no discrimination against, or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee himself or herself or any person claiming under or through him or her, establish or'permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the premises." The foregoing covenants regarding discrimination shall run with the land and shall remain in effect in perpetuity. V. R Soo] PERFORMANCE OF MAINTENANCE A. Participant shall maintain in accordance with City Standards, as hereinafter defined, the improvements and landscaping on the Site. Said improvements shall include, but not be limited to, buildings, sidewalks, pedestrian lighting, landscaping, irrigation of landscaping, architectural elements identifying the Site and any and all other improvements on the Site. B. To accomplish the maintenance, Participant shall either staff or contract with and hire licensed and qualified personnel to perform the maintenance work, including the provision of labor, equipment, materials, support facilities and any and all other items necessary to comply with the requirements of this Agreement. C. CITY STANDARDS The following standards ("City Standards") shall be complied with by Participant and its maintenance staff, contractors or subcontractors: 1. Landscape maintenance shall include, but not be limited to: watering/irrigation; fertilization; mowing; edging; trimming of grass; tree and shrub pruning; trimming and shaping of trees and shrubs to maintain a healthy, natural appearance and safe road conditions and visibility and optimum irrigation coverage; replacement, as needed, of all plant materials; control of weeds in all planters, shrubs, lawns, ground covers or other planted areas; and staking for support of trees. 2. Clean-up maintenance shall include, but not be limited to: maintenance of all sidewalks, paths and other paved areas in clean and weed -free condition; maintenance of all such areas clear of dirt, mud, trash, debris or other matter which is unsafe or unsightly; removal of all trash, litter and other debris from improvements and landscaping prior to mowing; clearance and cleaning of all areas maintained prior to the end of the day on which the maintenance operations are performed to ensure that all cuttings, weeds, leaves and other debris are properly disposed of by maintenance workers. PUBL:9786_111871B2588.0 5-4 3. All maintenance work shall conform to all applicable federal and state Occupation Safety and Health Act standards and regulations for the performance of maintenance. 4. Any and all chemicals, unhealthful substances, and pesticides used in and during maintenance shall be applied only by persons possessing valid California applicators licenses, and in strict accordance with all governing regulations. Precautionary measures shall be employed recognizing that all areas are open to public access. S. The improvements on the Site shall be maintained in conformance and in compliance with the approved Site construction and architectural plans and design scheme, as the same may be amended from time to time with the approval of the City (and Agency, if such approval is required) and reasonable commercial development maintenance standards for retail shopping centers, including but not limited to: painting and cleaning of all exterior surfaces and other exterior facades comprising all improvements. VI. [§ 6001 FAILURE TO MAINTAIN IMPROVEMENTS In the event Participant does not maintain the Site improvements in the manner set forth herein and in accordance with City Standards, Agency and/or City shall have the right to maintain such improvements, or to contract for the correction of such deficiencies, after written notice to Participant. However, prior to taking any such action, Agency agrees to notify Participant in writing if the condition of said improvements do not meet with City's Standards and to specify the deficiencies and the actions required to be taken by Participant to cure the deficiencies. Upon notification of any maintenance deficiency, Participant shall have thirty (30) days within which to correct, remedy or cure the deficiency. If the written notification states the problem is urgent relating to public health and safety, theft Participant shall have forty-eight (48) hours to rectify the problem. In the event Participant fails to correct, remedy or cure or has not commenced correcting, remedying or curing such maintenance deficiency after notification and after the period of correction has lapsed, then City and/or Agency shall have the right to maintain such improvements. Participant agrees to pay Agency such charges and costs. Until so paid, the Agency shall have a lien on the Site for the amount of such charges or costs, which lien shall be perfected by the recordation of a "Notice of Claim of Lien" against the Site. Upon recordation of a Notice of a Claim of Lien against the Site, such lien shall constitute a lien on the fee estate in and to the Site prior and superior to all other monetary liens except: (i) all taxes, bonds, assessments and other levies which, by law, would be superior thereto; (ii) the lien or charge of any mortgage, deed of trust or other security interest then of record made in good faith and for value, it being understood that the priority of any such lien for costs incurred to comply with this Agreement shall date from the date of the recordation of the Notice of Claim of Lien. Any such lien shall be subject and subordinate to any lease or sublease of the interest of Participant in the Site or any portion thereof and to any easement affecting the Site or any portion thereof entered into at any time (either before or after) the date of recordation of such a Notice. Any lien in favor of the Agency created or claimed hereunder is expressly made subject and subordinate to any mortgage or deed of trust made in good faith and for value, recorded as of the date of the recordation of the Notice of Claim of Lien, and no such lien shall in any way defeat, invalidate or impair the obligation or priority of any such mortgage or deed of trust, unless the mortgage or PUBL:9786_111871 B2588.0 5-5 beneficiary thereunder expressly subordinates his interest, of record, to such lien. No lien in favor of the Agency created or claimed hereunder shall in any way defeat, invalidate or impair the obligation or priority of any lease, sublease or easement unless such instrument is expressly subordinated to such lien. Upon foreclosure of any mortgage or deed of trust made in good faith and for value and recorded prior to the recordation of any unsatisfied Notice of Claim of Lien, the foreclosure -purchaser shall take title to the Site free of any lien imposed by the Agency that has accrued up to the time of the foreclosure sale, and upon taking title to the Site, such foreclosure -purchaser shall only be obligated to pay costs associated with this Agreement accruing after the foreclosure -purchaser acquires title to the Site. If the Site is ever legally divided with the written approval of the Agency and fee title to various portions of the Site is held under separate ownerships, then the burdens of the maintenance obligations set forth herein and in this Agreement and the charges levied by the Agency to reimburse the Agency for the cost of undertaking such maintenance obligations of Participant and its successors and the lien for such charges shall be apportioned among the fee owners of the various portions of the Site under different ownerships according to the square footage of the land contained in the respective portions of the Site owned by them. Upon apportionment, no separate owner of a portion of the Site shall have any liability for the apportioned liabilities of any other separate owner of another portion of the Site, and the lien shall be similarly apportioned and shall only constitute a lien against the portion of the Site owned in fee by the owner who is liable for the apportioned charges levied by the Agency and secured by the apportioned lien and against no other portion of the Site. Participant acknowledges and agrees City and Agency may also pursue any and all other remedies available in law or equity. Participant shall be liable for any and all attorneys' fees and other legal costs or fees incurred in collecting said maintenance costs. VII. [§ 7001 COMPLIANCE WITH LAW Participant shall comply with all local, state and federal laws relating to the uses of or condition of the Site. Local laws for the purposes of this section shall include only those ordinances which are nondiscriminatory in natare and applicable to the public welfare, health, safety and aesthetics. If any new local laws relating to uses of or condition of the improvements create a condition or situation that constitutes a lawful nonconforming use as defined by local ordinance with respect to the Site or any portion thereof, then so long as the lawful nonconforming use status remains in effect (i.e., until such lawful status is properly terminated by amortization as provided for in the new local law or otherwise), Participant shall be entitled to enjoy the benefits of such lawful nonconforming use pursuant to the lawful nonconforming uses ordinance. VIII. [§ 8001 COVENANTS RUN WITH THE LAND The improvements and the development, use, operation and maintenance thereof touch and concern the Site and inure to the benefit of any and all present or successive owners of the Site. Therefore, whenever the word "Participant" is used herein, it shall include the owner as of date of execution of this Agreement, and any and all successive owners or assigns of the Site, and the provisions hereof are expressly binding upon all such successive owners or assigns, and the parties agree all such provisions shall run with the land. Agency or City shall cause a fully executed copy of this Agreement to be recorded in the Office of the Los Angeles County Recorder. Notwithstanding the foregoing, in the event Participant or its successors or assigns, shall convey its fee interest in all or any portion of the Site, the conveying owner shall be free MBL:9786_11187I B2588.0 5-6 from and after the date of recording such conveyance of all liabilities, respecting the performance of the restrictions, covenants or conditions contained in this Agreement thereafter to be performed with respect tothe'Site, or any part thereof, it being intended that the restrictions, covenants and conditions shall be binding upon the record owners of the Site only during such time as they own the same, provided that the conveying owner shall remain liable for any actions prior to the date of the conveyance. VIII. R 10001 INDEMNIFICATION Participant agrees to protect, defend, indemnify and hold harmless City and Agency and their elective and appointive boards, officers, agents and employees from any and all claims, liabilities, expenses or damages of any nature, including reasonable attorney fees, (a) for injury to, or death of, any person, and for injury to any property, including consequential damages of any nature resulting therefrom, arising out of or in any way connected with the performance of this Agreement by Participant or its agents, servants, employees or contractors, but not from (i) the negligence or intentional acts of the City or Agency, or their agents, servants, employees or contractors in connection with supervision or direction of the work, or (ii) third parties unrelated to Participant or its agents, servants, employees or contractors, but not by the City or Agency or their respective agents, servants, employees or contractors and (b) from violation of any statute, law regulation or other legal requirement concerning a safe place for employment of workers by Participant or its agents, servants, employees or contractors, but not by (i) the City or the Agency or their respective agents, servants, employees or contractors or (ii) third parties unrelated to Participant or its agents, servants, employees or contractors. Participant shall comply with all of the provisions of the Workers' Compensation Insurance and Safety in Employment laws of the State of California, including the applicable provisions of Divisions 4 and 5 of the California Labor Code and all amendments thereto and all similar state, federal or local laws applicable; and shall indemnify and hold harmless City and Agency from and against all claims, liabilities, expenses, damages, suits, actions, proceedings and judgments of every nature and description, including reasonable attorneys' fees, presented, brought or recovered against City or Agency, for or on account of any liability under any of said laws which may be incurred by reason of work performed under this Agreement by Participant or its agents, servants, employees, contractors, but not by the sole acts of City and/or the Agency or if available,their respective agents, servants, employees or contractors. City and Agency do not, and shall not, waive any rights against Participant which they may have by reason of the aforesaid hold harmless agreements because of the acceptance by City or the deposit with the City by Participant of any insurance policies or certificate of insurance purporting to indemnify for the aforesaid losses. The aforesaid hold harmless agreements by Participant shall apply to all liabilities, claims, expenses and damages of every kind, including but not limited to reasonable attorney fees, suffered or alleged to have been suffered, by reason of the aforesaid operations by Participant or any of its agents, servants, employees or contractors, regardless of whether or not such insurance policies are applicable. Similarly, the City and the Agency shall protect, defend, indemnify and hold harmless Participant, its successors and assigns, and/or if available, their respective partners, boards, officers, agents and employees from any and all claims, liabilities, expenses or damages of any nature, including reasonable attorney's fees, (a) for injury to, or death of, any person and rusL:9786_1 1 187 1 B2588.0 5-7 for injury to any property, including consequential damages of any nature resulting therefrom, arising out of or in any way connected with the acts or inactions taken by the City and/or the Agency and/or its officers, employees, agents and representatives pursuant to the terms of this Agreement, but not the negligence or intentional acts of Participant, or its partners, agents, servants, employees or contractors; and (b) from violation of any statute, law, regulation or other legal requirement concerning a safe place for employment of workers by the City and/or the Agency, or their respective agents, servants, employees or contractors or by (i) Participant or its agents, servants, employees or contractors or (ii) third parties unrelated to the City or Agency or their respective agents, servants, employees or contractors. The City and/or the Agency shall comply with all the provisions of the Workers' Compensation Insurance and Safety and Employment Laws of the State of California, including the applicable provisions of Divisions 4 and 5 of the California Labor Code an all amendments thereto, and all similar state, federal or local laws applicable; and shall indemnify and hold harmless Participant and its successors and assigns, from and against any and all claims, liabilities, expenses, damages, suits, actions, proceedings and judgments of every nature and description, including reasonable attorneys' fees, presented, brought or recovered against Participant or its successors and assigns, for or on account of any liability under any of said laws which may be incurred by reason of any work performed under this Agreement by the City and/or Agency, or their respective agents, servants, employees or contractors, but not by (i) Participant or its agents, servants, employees or contractors or (ii) third parties unrelated to the City or Agency or their respective agents, servants, employees or contractors. Participant or its successors or assigns do not, and shall not, waive any rights against the City and/or the Agency which it (they) may have by reason of the aforesaid hold harmless agreement because of any insurance policies or certificates of insurance purporting to indemnify for the aforesaid losses. The aforesaid hold harmless agreement by the City arid/or the Agency shall apply to all liabilities, claims, expenses and damages of every kind, including, but not limited to, reasonable attorney's fees, suffered or alleged to have been suffered, by reason of the aforesaid operations by the City and/or the Agency, or their respective agents, servants, employees or contractors, regardless of whether or not such insurance policies are applicable. IX. [§ 1100] WORKERS COMPENSATION INSURANCE REQUIREMENTS Participant shall not commence work under this contract until it has obtained all insurance required herein, nor shall Participant allow any subcontractor to commence work on its subcontract until all similar insurance required of the subcontractor shall have been so obtained and approved. Participant shall submit to the Agency evidence of all required insurance prior to commencement of work and upon request of the Agency thereafter. Failure of Participant to supply and failure of City or Agency to secure and/or approve specified insurance shall not alter or invalidate this Agreement. Participant shall obtain and maintain during the life of this Agreement workers' compensation insurance and if any work is sublet by Participant, then Participant shall require the subcontractor similarly to provide workers' compensation insurance. Participant agrees to indemnify City and Agency for any damages resulting to it from failure of either Participant or any subcontractor to obtain or maintain such insurance. PUBL:9786-111871 B2588.0 5-8 If any work is sublet by the City and/or the Agency, then the City and/or the Agency shall contractually require the subcontractor to provide workers' compensation insurance. The City and/or Agency agree to indemnify Participant and/or its successors and assigns for any damages resulting to it from failure of either the City or the Agency or any subcontractor to obtain or maintain such insurance. X. [§ 12001 BODILY INJURY AND SITE DAMAGE INSURANCE REQUIREMENTS The Participant shall defend, assume all responsibility for and hold the Agency and the City and their officers, employees and agents, harmless from, all claims or suits for, and damages to, property and injuries to persons, including accidental death (including attorneys fees and costs), which may be caused by any of the Participant's activities under this Agreement, whether such activities or performance thereof be by the Participant or anyone directly or indirectly employed or contracted with by the Participant and whether such damage shall accrue or be discovered before or after termination of this Agreement. The Participant shall take out and maintain in effect a comprehensive liability policy in the amount of Two Million Dollars ($21,000,000) combined single limit policy, including contractual liability, as shall protect the Participant, City and Agency from claims for such damages. The Participant shall furnish a certificate of insurance countersigned by an authorized agent of the insurance carrier on a form of the insurance carrier setting forth the general provisions of the insurance coverage. This countersigned certificate shall name the City and the Agency, and if available their respective officers, agents, and employees, as additional insureds under the policy. The certificate by the insurance carrier shall contain a statement of obligation on the part of the carrier to notify City and the Agency of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by the Participant shall be primary insurance and not contributing with any insurance maintained by the Agency or City, and the policy shall contain such an endorsement. The insurance policy or the certificate of insurance shall contain a waiver of subrogation for the benefit of the City and the Agency. M. [§ 13001 WAIVER Failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. The aggrieved party shall give written notice of the default to the party in default as set forth in Section 300 hereof. The defaulting party must within a reasonable time commence to cure, correct or remedy such default, and shall complete such cure, correction or remedy with reasonable and due diligence, and during such period or curing shall not be in default. The waiver by one party of the performance of any covenant, condition or promise shall not invalidate this Agreement nor shall it be considered a waiver by such party of any other covenant, condition or promise hereunder. The exercise of any remedy shall not preclude the exercise of other remedies City, Agency or Participant may have at law or at equity. ML:9786_11187 ( B2588.0 5-9 XII. [§ 14001 MODIFICATION This Agreement may be modified only by subsequent mutual written agreement executed by Participant, Agency and City. XIII. [§ 15001 ATTORNEY'S FEES In the event of litigation arising out of any breach of this Agreement, the prevailing party shall be entitled to recover reasonable costs and attorney's fees. CITY OF LA QUINTA, a mu . ipal corporation Dated: 12 21 cj 3 By; (113 MAYO A T: ity Clerk APPROVED AS TO FORM: Dated: 2 2 / 5 ?J "CITY" LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic By: Ch "AGENCY" PUBL:9786_11 ls71B25as.o 5-10 APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Special Counsel to the Agency KOENIG COMPANIES, a California corporation By: w . Dated: Its: _ PuaL:9786_111871 M588.0 5-11 ATTACHMENT NO. 6 RECORDING REQUESTED BY ) AND WHEN RECORDED MAIL TO: ) KOENIG COMPANIES ) [Space above for Recorder.] This document is exempt the payment of a recording fee pursuant to Government Section 6103. CERTIFICATE OF COMPLETION THIS CERTIFICATE OF COMPLETION (the "Certificate") is made by the LA QUINTA REDEVELOPMENT AGENCY, a public body corporate 3nd politic (the "Agency"), in favor of KOENIG COMPANIES, a (he "Participant"). RECITALS A. The Agency and the Participant have entered into that certain Owner Participation Agreement (the "OPA") dated , 1993 concerning the develo ment of certain real property situated in the City of La Quinta, California as more fully described ' Exhibit "A" attached hereto and made a part hereof. B. As referenced in Section 311 of the OPA, the Agency] is required to furnish the Participant or its successors with a Certificate of Completion upon mpletion of construction and development of the improvements, which certificate shall be in such -as to permit it to be recorded in the official records of Riverside County. This Certificate of Completion is required to be conclusive determination of satisfactory completion of the cons ction and development required by the OPA. C. The Agency has conclusively determined that such co truction and development has been satisfactorily completed. NOW, THEREFORE, the Agency hereby certifies follows: 1. The improvements to be constructed by Participant h ve been fully and satisfactorily completed in conformance with the OPA and the Agr ment Regarding Covenants to Develop, Use, Maintain and Operate recorded in Instrument No. 2. This Certificate of Completion shall not constitute evidence of compliance with or satisfaction of any obligation of the Participant -to any holder of any mortgage, or any insurer of a mortgage loaned to finance the improvements, or any part thereof. PuBL:9786_111871 W.588.0 6-1 3. This Certificate of Completion is not a notice of completion as referred to in California Civil Code Section 3093. IN WITNESS WHEREOF, the Agency has executed this certificate this day of , I9_. LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic By: Its: ATTEST: Agency Secretary APPROVED AS TO FORM: Stradling, Yocca, Carlson & Rauth, Agency Special Counsel The undersigned Participant accepts the Site subject to the conditions and covenants hereinabove set forth. KOENIG COMPANIES, a California corporation By: Dated: Its: PUBL:9786_I11871B2588.0 6-2 EXHIBIT "A" LEGAL DESCRIPTION That land situated in the State of California, County of Riverside, City of La Quinta, described as follows: [To Be Inserted] PUBL:9786_111871B2588.0 6-3 State of California ss. County of On , 199_, before me, (nine, tide of officer, e.g., Jane Doe, Notary Public") personally appeared (nanw(s) of signer(s)) ❑ personally known to me —OR- 0 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 person(s) acted, executed the instrument. Witness my hand and official seal. Capacity claimed by signer: ❑ Individual ❑ Corporate Officer(s): ❑ Partner(s): ❑ General ❑ ❑ Attorney -in -fact ❑ Trustee(s) ❑ Guardian/Conservator ❑ Other: Limited (Signature of Notary) (This section is OP77ONAL.) Signer is representing: mmne of persons or entity m Attention Notary: Although the information requested below is OPTIONAL, it could prevent fraudulent attachment of this certificate to an unauthorized document. THIS CERTIFICATE Title or Type of Document MUST BE ATTACHED TO THE DOCUMENT Number of Pages Date of Document. DESCRIBED AT RIGHT: Signer(s) Other than Named Above wat,:9786_111871 M588.0 6-4