Apple Valley City Council
September 8, 2026

APPLE VALLEY TOWN COUNCIL
AGENDA

Tuesday, September 8, 2026, 6:30 p.m.

Council Chamber
PLEASE SILENCE CELL PHONES UPON ENTERING THE CHAMBER. THIS MEETING IS BROADCAST LIVE ON FRONTIER CHANNEL 29, CHARTER SPECTRUM CHANNEL 186, AND STREAMED AT HTTPS://APPLEVALLEY.TV.

THIS MEETING IS CONDUCTED AS A HYBRID MEETING PURSUANT TO GOVERNMENT CODE SECTION 54953 (SB 707). THE PUBLIC MAY ATTEND IN PERSON OR JOIN REMOTELY VIA

MICROSOFT TEAMS WEBINAR USING THE LINK OR DIAL-IN INFORMATION PROVIDED ON THIS AGENDA. THE TOWN OF APPLE VALLEY IS NOT RESPONSIBLE FOR THE

FUNCTIONALITY OF ANY PERSONAL ELECTRONIC DEVICE USED TO ACCESS THIS MEETING.

TEAMS LINK: HTTPS://AV.TOWN/JOINCOUNCIL
DIAL IN: +1 831-753-3249 PHONE CONFERENCE ID: 879 093 323# TO MAKE A PUBLIC COMMENT REMOTELY, USE THE "RAISE HAND" FUNCTION IN TEAMS WHEN THE PRESIDING OFFICER CALLS FOR PUBLIC COMMENT. YOU MAY ALSO EMAIL [email protected] BY 12:00 P.M. ON THE MEETING DATE TO HAVE YOUR COMMENT INCLUDED IN THE RECORD.

The meeting is held in the Council Chamber at 14955 Dale Evans Parkway, Apple Valley, CA. This agenda is posted at least 72 hours in advance per the Brown Act. The agenda, supporting documents, and meeting videos are available at www.applevalley.org. Late-submitted materials are available for inspection in the Town Clerk's Office during normal business hours.

Consent Calendar items are considered routine and will be acted upon together unless the Town Council directs otherwise.

Members of the public may address the Town Council on any agenda item or matter within its jurisdiction. In person: submit the yellow Request to Speak card. Remotely: use the "Raise Hand" function in Teams when called upon. All speakers are limited to three (3) minutes and must direct comments through the Presiding Officer.

No action or discussion may be taken on items not appearing on the posted agenda per Government Code Section 54954.3.

Disruptive conduct is a misdemeanor under PC403 and may result in removal from the chamber, disconnection from the remote platform, or arrest.

For disability accommodations, contact the Town Clerk's Office at (760) 240-7000 at least two working days before the meeting.

Pages

1. Call to Order

2. Opening Ceremonies

2.1 Invocation
Pastor Hunter McCoy, with Calvary Chapel in Apple Valley.

2.2 Pledge of Allegiance

2.3 Presentations
A. Employee of the Quarter; Rosie Garcia, Executive Assistant.

Chris Ackerman, Victor Valley Transit Authority, presentation on Hydrogen Buses.

B.

3. Public Comments

4. Councilmember Committee/Commission/Community Participation 9 Councilmembers to make brief reports on their participation on committees, boards, and commissions on the Town’s behalf since the last meeting.

Councilmembers may also make brief reports on their community participation.

No formal action will be taken.

5. Town Council Announcements

5.1 Suggested items for next Agenda

5.2 Time, Date & Place for Next Town Council Regular or Special Meeting Regular Meeting – October 13, 2026 - Council Chambers
Regular Session at 6:30 p.m.

A.

6. Town Council Consent Agenda
Recommended Motion:

To approve the Consent Calendar items numbered 6.1-6.13 as recommended.

6.1 APPROVAL OF MINUTES 11
That the Town Council approve the subject minutes as part of the consent agenda.

6.2 APPROVAL OF RESOLUTION NUMBER 2026-30 OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA,
AMENDING RESOLUTION NO. 2024-31 AND APPROVING AN

AMENDED CONFLICT OF INTEREST CODE
21 That the Town Council adopt Resolution Number 2026-30 - A Resolution of the Town Council of the Town of Apple Valley, California, Approving an Amended Conflict of Interest Code Pursuant to the Political Reform Act of 1974.

6.3 AWARD THE CONTRACT FOR THE CONSTRUCTION OF THE APPLE

VALLEY GOLF COURSE MONUMENT SIGN AND LANDSCAPE

PROJECT
31 That the Town Council: Award the contract for the Apple Valley Golf Course Landscape and Monument Sign Project to No Limit Construction in the amount of $135,000; Authorize the Town Manager or designee to execute the contract and any necessary related documents; Approve a 10% project contingency in the amount of $13,500, for a total project budget of $148,500; and Approve a budget amendment transferring $98,500 from the General Fund to the Golf Course Capital Improvement Fund, Account 57106035-750100, to provide sufficient funding for the project and contingency.

6.4 ADOPT ORDINANCE NO. 577 TO CHANGE THE ZONING OF
PARCELS 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 AND 0472-301-01 FROM OFFICE PROFESSIONAL (O-P) TO

REGIONAL COMMERCIAL (C-R) AND ADDING THE I-N INDUSTRIAL

ECOMMERCE OVERLAY AND AMENDING
41 TITLE 9, SECTION 9.35.020.D AND TABLE 9.35.030-A, FOOTNOTE 7,

OF THE TOWN OF APPLE VALLEY MUNICIPAL CODE, TO EXPAND

THE I-N ECOMMERCE OVERLAY BOUNDARY EASTWARD TO
INCLUDE THE APPLE VALLEY 84 PROJECT SITE AND REVISE THE I-N OVERLAY ACREAGE FROM 978 TO 1,071 ACRES.

Adopt Ordinance No. 577, an Ordinance of the Town Council of the Town of Apple Valley, amending the zoning of Parcels 0472-211-01, -02, -03, - 09, -10, -11, -17, -18, -19, -20, -21 and 0472-301-01 from Office Professional to Regional Commercial on the Town of Apple Valley Zoning Map and amending Town of Apple Valley Development Code Sectoin 9.35.020.D and Table 9.35.030-A, Footnote 7, to expand the I-N overlay boundary eastward to include the Apple Valley 84 project site and revise the overlay’s acreage from 978 acres to 1,071 acres.

6.5 ADOPT ORDINANCE NO. 578, AN ORDINANCE OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, APPROVING A

DEVELOPMENT AGREEMENT BETWEEN THE TOWN OF APPLE
VALLEY AND APPLE 84 LLC RELATED TO THE APPLE VALLEY 84
INDUSTRIAL DEVELOPMENT PROPOSED ON 93 ACRES OF LAND
51 (PARCEL NUMBERS 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, - 20, -21 AND 0472-301-01) WITHIN THE TOWN OF APPLE VALLEY, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA.

Adopt Ordinance No. 578, an Ordinance of the Town Council of the Town of Apple Valley, approving a Development Agreement between the Town of Apple Valley and Apple 84 LLC related to the Apple Valley 84 industrial development proposed on 93 acres of land (parcel numbers 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 and 0472-301- 01) within the Town of Apple Valley, County of San Bernardino, State of California.

6.6 ADOPT ORDINANCE NO. 579, AN ORDINANCE OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA,
APPROVING DEVELOPMENT AGREEMENT 2026-002 BETWEEN THE

TOWN OF APPLE VALLEY AND COV APPLE VALLEY, LLC IN
CONNECTION WITH THE APPLE VALLEY 143 PROJECT
93 Adopt Ordinance No. 579, an Ordinance of the Town Council of the Town of Apple Valley, approving Development Agreement No. 2026-002 between the Town of Apple Valley and COV Apple Valley, LLC related to the Apple Valley 143 industrial development proposed on approximately 143 acres of land (parcel numbers 0472-211-05, 0472-211-06, 0472-211- 15, 0472-222-06, and 0472-222-11) within the Town of Apple Valley, County of San Bernardino, State of California.

6.7 2028 THROUGH 2032 CAPITAL PROJECT NEEDS ANALYSIS 147 Approve the Fiscal Year 2027/2028 through Fiscal Year
2031/2032 Capital Project Needs Analysis.

A.

Adopt Resolution No. 2026-32, adopting the Measure I FiveYear Capital Project Needs Analysis.B.

6.8 APPROVE FINAL PARCEL MAP 20788 155
Approve the final map for Parcel Map No. 20788, subject to approval as to form by the Town Attorney and as to content by the Town Manager.

6.9 APPROVE FINAL PARCEL MAP 20789 159
Approve the final map for Parcel Map No. 20789 subject to approval as to form by the Town Attorney and as to content by the Town Manager.

6.10 AWARD RESURFACING 2026 PROJECT 174
Review and approve the bid documents for the Resurfacing 2026 Project;
A.

Award a contract to Pavement Coatings Co., in the amount of $1,476,259.00, for the Resurfacing 2026 Project and approve a 10% contingency of $147,625.90;
B.

Authorize the Town Manager to approve additional work
consisting of eligible street segments at the contract unit prices, subject to available RMRA funding and the terms of the contract, for a total contract amount not-to-exceed $2,200,000.00, subject to “Approval as to Form” by the Town Attorney and “Approval as to Content” by the Town Manager.

C.

6.11 ADOPT 2026-2027 MEASURE I FIVE-YEAR PLAN 193
Approve the Fiscal Year 2026/27 through Fiscal Year 2030/31 Measure I Five-Year Capital Improvement Plan.

A.

Adopt Resolution No. 2026-33, adopting the Fiscal Year 2026/27 through Fiscal Year 2030/31 Measure I Five-Year Capital Improvement Plan.

B.

6.12 FISCAL YEAR 2026-2027 BUDGET OF THE APPLE VALLEY

PROPERTY AND BUSINESS IMPROVEMENT DISTRICT (PBID)

ASSOCIATION
198
That the Town Council approve the Fiscal Year (FY) 2026-2027 budget of the Apple Valley Property and Business Improvement District (PBID) Association.

6.13 PROPOSAL TO CONTINUE THE VILLAGE ENHANCED SECURITY

PROGRAM IN THE APPLE VALLEY VILLAGE PROPERTY AND

BUSINESS IMPROVEMENT DISTRICT
201
Approve the San Bernardino County Sheriff’s Department’s (Sheriff) Proposal to Continue the Village Enhanced Security Program (Program) in the Village Property and Business Improvement District (PBID)

7. Public Hearings

7.1 2025-2026 Consolidated Annual Performance Evaluation Report (CAPER)
205
It is recommended that the Town Council:

A. Conduct a public hearing and accept public testimony on the Program Year (PY) 2023-2024 Consolidated Annual Performance Evaluation Report (CAPER).

B. Approve the PY 2023-2024 CAPER.

C. Authorize the Town Manager or his designee to submit the PY 2023- 2024 CAPER to the U.S. Department of Housing and Urban
Development (HUD), along with any public testimony and changes thereto as directed by the Town Council.

8. Business of the Council

8.1 FINAL REVIEW OF TOWN OF APPLE VALLEY VISION, MISSION,

CORE VALUES, AND SUPPORTING GOALS PRIOR TO ADOPTION
427
Provide final thoughts and input on the Town of Apple Valley Vision, Mission, Core Values, and supporting goals as the Town’s strategic framework for guiding future priorities, investments and decision-making.

A.

Move to direct staff to bring final “Vision” resolution back to Council for approval at the next scheduled meeting.

B.

8.2 INTRODUCE ORDINANCE NO. 580 AN ORDINANCE OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA,
AMENDING CHAPTER 12.37, ENTITLED “GENERAL VEHICLE
PARKING RESTRICTIONS” OF TITLE 12 OF THE TOWN OF APPLE

VALLEY MUNICIPAL CODE, AND DESIGNATING THE
468
SUPERINTENDENT OF STREETS.

Find the proposed adoption of Ordinance No. 580 is exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines section 15061(b)(3) because it can be seen with certainty that there is no possibility that the proposed amendment may have a significant effect on the environment.

A.

Move to waive the reading of Ordinance No. 580 in full and read the ordinance by title only.

B.

Move to introduce Ordinance No. 580, entitled “An Ordinance of the Town Council of the Town of Apple Valley, California, Amending Chapter 12.37, ‘General Vehicle Parking Restrictions,’ of Title 12 of the Apple Valley Municipal Code”
C.

Schedule adoption of Ordinance No. 580 and adoption of
Resolution No. 2026-34, establishing no-parking and nostopping zones within the Town of Apple Valley for the next Town Council meeting.

D.

8.3 A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF APPLE

VALLEY APPROVING ORGANIZATIONAL CHANGES AND
ASSOCIATED AMENDMENTS TO THE TOWN’S CLASSIFICATION

AND SALARY SCHEDULE
481
Approve Resolution No. 2026-31, A Resolution of the Town Council of the Town of Apple Valley, California, approving organizational changes and associated amendments to the Town’s Classification and Salary Schedule.

9. Reports, Requests and Communications

10. Town Manager’s Comments & Legislative Update

11. Closed Session
Recommended Motion:

To Adjourn the regular meeting to move into Closed Session at TIME to discuss the following:

11.1 CLOSED SESSION 586
A. CONFERENCE WITH LEGAL COUNSEL – EXISTING LITIGATION
Pursuant to Paragraph (1) of subdivision (d) of Government Code Section 54956.9
Town of Apple Valley vs. Apple Valley Ranchos Water Company Et Al., San Bernardino Superior Court Case No.: CIVDS1600180, California Court of Appeal Case No. E078348, and California Supreme Court Case No. S289391

B. Public Employee Discipline/Dismissal/Release
(Consideration of Certification of Ad Hoc Council Committee Decision on Appeal Hearing Pursuant to Section 13.3 of Personnel Rules) Pursuant to Government Code Section 54957(b)

12. Adjournment
Recommended Motion:

To adjourn the meeting of the Apple Valley Town Council at TIME.

TOWN OF APPLE VALLEY

TOWN COUNCIL SERVING ON BOARDS, COMMITTEES & COMMISSIONS

CITIZEN ADVISORY COMMITTEES

HISTORICAL ADVISORY COMMITTEE (HAC)
Council Member Cusack
Meets every 2nd Tuesday of each month at 9:00 a.m.,
(location may vary)

SPECIAL ADVISORY COMMITTEES
DISASTER PREPAREDNESS*
Mayor - Chairman
Meets quarterly at 1:30 p.m., Town of Apple Valley
Conference Center - Development Services Building
14975 Dale Evans Parkway, Apple Valley.

TRAFFIC ADVISORY COMMITTEE (TAC)
Mayor Nassif
Meets as needed.

Town Council Chambers

TOWN PERSONNEL COMMITTEE
Mayor Nassif
Council Member Bishop
Meets as needed

PARK AND RECREATION ADVISORY COMMITTEE
Mayor Nassif
Council Member Emick

AD HOC COMMITTEES

APPLE VALLEY ROAD AD HOC COMMITTEE
Mayor Nassif

VILLAGE MERCHANTS AD HOC COMMITTEE
Council Member Emick

SINGLE-FAMILY RESIDENTIAL DESIGN CRITERIA

AD-HOC COMMITTEE
Council Member Bishop
Mayor Pro-Tem Leon

AGENCY - BOARDS/COMMITTEES &

COMMISSIONS

CALIFORNIA JOINT POWERS INSURANCE

AUTHORITY (CJPIA)
Mayor Nassif – Director
Exec. Committee meets every 4th Wednesday of each
month at 7:00 p.m., La Palma, CA.

CAL CITIES/DESERT MOUNTAIN DIVISION (DMD)
Mayor Nassif- Voting Delegate
Council Member Bishop – Alternate
Meets as needed, rotating cities.

MOJAVE DESERT AIR QUALITY MANAGEMENT

DISTRICT (MDAQMD)
Mayor Pro-Tem Leon-– Delegate
Council Member Emick – Alternate
Meets every 4th Monday of each month at 10:00 a.m.,
14306 Park Avenue, Victorville

MOJAVE DESERT AND MOUNTAIN RECYCLING

AUTHORITY
Council Member Cusack – Delegate
Council Member Bishop – Alternate
Meets quarterly on the 2nd Thursday February, May,
August and November at 10:00 a.m.
at the Materials Recovery Facility, 17000 Abbey Lane,
Victorville

SAN BERNARDINO COUNTY TRANSPORTATION

AUTHORITY (SBCTA)
Council Member Bishop - Board Member
Council Member Cusack – Alternate
Meets 2
nd Wednesday of each month at 9:00 a.m.,
I10/I15 Corridor meets 2nd Thursday at 10:00 a.m.
1170 West 3rd St.

San Bernardino

SOLID WASTE ADVISORY TASK FORCE (SWAT)
Council Member Cusack – Committee Member
Julie Ryan - Alternate
Meets as needed on Wednesdays at 1:30 p.m.

Sam J. Racadio Library & Environmental Learning
Center Community Room 7863 Central Ave. Highland

VICTOR VALLEY ECONOMIC DEVELOPMENT

AUTHORITY (VVEDA)
(George Air Force Base Reuse Task Force)
Council Member Emick – Commissioner
Council Member Bishop – Alternate
Meets as needed, SCLA

VICTOR VALLEY TRANSIT AUTHORITY (VVTA)
Council Member Emick – Representative
Mayor Pro-Tem Leon - Alternate
Meets every 3rd Monday of each month at 9:30 a.m.,
Victorville City Hall

VICTOR VALLEY WASTEWATER RECLAMATION

AUTHORITY (VVWRA)
Mayor Nassif – Commissioner
Council Member Bishop – Alternate
Meets every 3rd Thursday at 7:30 a.m.

VVWRA Offices

GREATER HIGH DESERT CHAMBERS

GOVERNMENTAL RELATIONS COMMITTEE
Council Member Bishop – Representative
Council Member Cusack – Alternate
*These Boards, Committees and
Commissions require the Mayor to serve
as the representative.

Town Council Agenda Report
Date: September 8, 2026
To: Honorable Mayor and Town Council
Subject: APPROVAL OF MINUTES

From: Guy Eisenbrey, Town Manager
Submitted by: Kiel Mangerino, Acting Town Clerk
Budgeted Item: Yes No N/A

RECOMMENDED ACTION
That the Town Council approve the subject minutes as part of the consent agenda.

SUMMARY:

A. Regular Meeting, August 25, 2026

Apple Valley Town Council

MINUTES
August 25, 2026, 6:30 p.m.

Council Chamber
Members Present: Mayor Scott Nassif
Council Member Curt Emick
Council Member Art Bishop
Council Member Larry Cusack
Mayor Pro Tem Kari Leon
_____________________________________________________________________

1. Call to Order
Mayor Nassif called to order the regular session of the Apple Valley Town Council at 6:30pm.

2. Opening Ceremonies

2.1 Invocation
Council Member Art Bishop

2.2 Pledge of Allegiance
The Pledge of Allegiance was led by Council Member Kari Leon.

2.3 Presentations
Silvia Urenda, Assistant Director of Economic Development and Housing, presentation of Community Development Block Grant (CDBG) Recipients.

Brett Morgan, Streets Supervisor, Presentation on Street Signs.

August 25, 2026, Town Council Meeting
2 3. Public Comments
David Dencker
Kerry Henard
Bill Inger
Ray Simms
Matthew Rutledge
Gayle Flinchum

4. Councilmember Committee/Commission/Community Participation Councilmembers to make brief reports on their participation on committees, boards, and commissions on the Town’s behalf since the last meeting.

Councilmembers may also make brief reports on their community participation.

No formal action will be taken.

Council Member Cusack commented on committees and events he attended.

Council Member Bishop commented on committees and events he attended.

Council Member Emick commented on committees and events he attended.

Mayor Pro-Tem Leon commented on committees and events she attended.

Mayor Nassif commented on committees and events he attended.

5. Town Council Announcements

5.1 Suggested items for next Agenda
Council Member Bishop asked staff to review SB 1037, which the San Bernardino County Transportation Authority has recommended that the Town oppose.

5.2 Time, Date & Place for Next Town Council Regular or Special Meeting A. Regular Meeting – September 8, 2026 - Council Chambers Regular Session at 6:30 p.m.

August 25, 2026, Town Council Meeting
3 6. Town Council Consent Agenda
Council Member Cusack and Mayor Nassif recused from voting on item 6.4 (A) due to real property interests in the Village Business Improvement District.

Motion by: Mayor Pro Tem Leon
Seconded by: Council Member Emick
To approve the Consent Calendar items numbered 6.1 to 6.4 as recommended.

Yes (5): Mayor Nassif, Council Member Emick, Council Member Bishop, Council Member Cusack, and Mayor Pro Tem Leon
Carried (5 to 0)

6.1 APPROVAL OF MINUTES
That the Town Council approve the subject minutes as part of the consent agenda.

6.2 APPROVE FINAL PARCEL MAP 20294
Move to accept the final map for Parcel Map No. 20294.

6.3 EXCLUSIVE NEGOTIATING AGREEMENT WITH EAGLE REAL

ESTATE INVESTMENT GROUP LLC FOR THE DEVELOPMENT OF

SENIOR HOUSING ON TOWN OWNED PROPERTY
That the Town Council conduct a Public Hearing; and
A. Approve the Exclusive Negotiating Agreement (ENA) between the Town and Eagle Real Estate Investment Group LLC.

B. Authorize the Town Manager to execute the Exclusive Negotiating Agreement (ENA).

6.4 RE-ADOPTION OF AMENDED AND RESTATED RESOLUTIONS NOS 2026-23, 2026-24, AND 2026-25 ASSESSMENT AND LIEN

PROCEEDINGS
That the Town Council adopt the following Amended and Restated Resolutions:

A. Amended and Restated Resolution No. 2026-23, approving the levy and collection of Fiscal Year 2026-27 assessments within the Apple Valley Village Property and Business Improvement District (PBID);

August 25, 2026, Town Council Meeting
4 B. Amended and Restated Resolution No. 2026-24, confirming delinquent animal control, utility, and code enforcement fees and costs against real property and directing that the charges constitute liens and be collected on the County property tax roll; and C. Amended and Restated Resolution No. 2026-25, confirming the diagram and assessment and levying the Fiscal Year 2026-27 assessment for Assessment District No. 1 pursuant to the Landscaping and Lighting Act of 1972.

7. Public Hearings

7.1 GENERAL PLAN AMENDMENT (GPA) 2024-001, ZONE CHANGE (ZC) 2024-007, DEVELOPMENT CODE AMENDMENT (DCA) 2024-001,
DEVELOPMENT PERMIT (DP) 2025-013, TENTATIVE PARCEL MAP
(TPM) NO. 21034, DEVELOPMENT AGREEMENT (DA) 2026-003,
AND ENVIRONMENTAL IMPACT REPORT SCH#2025100104 FOR
APPLE VALLEY 84 DEVELOPMENT PROJECT, INCLUDING 1.38

MILLION SQ FT E-COMMERCE FACILITY AND RELATED SITE

IMPROVEMENTS
That the Town Council hold a public hearing and;
A. Adopt Resolution No. 2026-27 certifying EIR report (SCH #2025100104) and adopting CEQA findings for the Apple Valley 84 Development Project and direct Staff to file a Notice of Determination;
B. Adopt Resolution No. 2026-28 adopting the General Plan Amendment (GPA) 2024-001;
C. Adopt Resolution No. 2026-29 adopting Tentative Parcel Map (TPM) 21034 and Development Permit (DP) 2025-013, effective upon the Zone Change-Development Code Amendment ordinance and the Development Agreement ordinance going into effect; D. Move to Introduce Ordinance No. 577 adopting Zone Change (ZC) 2024-007, changing zoning from Office Professional (O-P) to Regional Commercial (C-R) and Industrial Ecommerce Overlay (IN); E. Move to waive the reading of Ordinance No. 577 in its entirety and read by title only;

August 25, 2026, Town Council Meeting
5 F. Move to Introduce Ordinance No. 578 approving Development Agreement2026-003 between the Town of Apple Valley and Apple 84 LLC;
G. Move to waive the reading of Ordinance No. 578 in its entirety and read by title only.

H. Direct the Town Clerk to schedule both Ordinances 577 and Ordinance 578 for a second reading and adoption at the next regularly scheduled Town Council meeting.

Mayor Nassif opened the Public Hearing at 8:03 pm.

Richard Hirsch - Planning Consultant, presented the staff report as filed with the Town Clerks office.

PUBLIC COMMENTS
Louie Lopez
Amy Smith
Jonnie Escobedo
Gaby
Mayor Nassif Closed the Public Hearing at 8:39 pm.

Kiel Mangerino, Town Clerk read the Title of Ordinance numbers 577 and 578
Motion by: Council Member Cusack
Seconded by: Mayor Pro Tem Leon
A. Adopt Resolution No. 2026-27 certifying EIR report (SCH #2025100104) and adopting CEQA findings for the Apple Valley 84 Development Project and direct Staff to file a Notice of Determination; B. Adopt Resolution No. 2026-28 adopting the General Plan Amendment (GPA) 2024-001;
C. Adopt Resolution No. 2026-29 adopting Tentative Parcel Map (TPM) 21034 and Development Permit (DP) 2025-013, effective upon the Zone Change-Development Code Amendment ordinance and the Development Agreement ordinance going into effect;
E. Move to waive the reading of Ordinance No. 577 in its entirety and read by title only;

August 25, 2026, Town Council Meeting
6 G. Move to waive the reading of Ordinance No. 578 in its entirety and read by title only.

Yes (5): Mayor Nassif, Council Member Emick, Council Member Bishop, Council Member Cusack, and Mayor Pro Tem Leon
Carried (5 to 0)
Motion by: Council Member Emick
Seconded by: Council Member Cusack
D. Move to Introduce Ordinance No. 577 adopting Zone Change (ZC) 2024-007, changing zoning from Office Professional (O-P) to Regional Commercial (C-R) and Industrial Ecommerce Overlay (I-N); F. Move to Introduce Ordinance No. 578 approving Development Agreement2026-003 between the Town of Apple Valley and Apple 84 LLC; H. Direct the Town Clerk to schedule both Ordinances 577 and Ordinance 578 for a second reading and adoption at the next regularly scheduled Town Council meeting.

Yes (5): Mayor Nassif, Council Member Emick, Council Member Bishop, Council Member Cusack, and Mayor Pro Tem Leon
Carried (5 to 0)

7.2 INTRODUCE ORDINANCE NO. 579 AN ORDINANCE OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA,
APPROVING DEVELOPMENT AGREEMENT 2026-002 BETWEEN THE

TOWN OF APPLE VALLEY AND COV APPLE VALLEY, LLC IN
CONNECTION WITH THE APPLE VALLEY 143
PROJECT (2.52 MILLION SQ FT INDUSTRIAL WAREHOUSING AND

RELATED INFRASTRUCTURE)
That the Town Council conduct a public hearing and;
A. Find that the environmental impacts of this Project were previously reviewed in conjunction with the Apple Valley 143 Project Environmental Impact Report (State Clearinghouse No.
2022070019) which was certified by the Planning Commission on November 15, 2023. This Development Agreement is consistent

August 25, 2026, Town Council Meeting
7 with the previously Certified Environmental Impact Report (the “Certified EIR”) and introduces no new significant environmental impacts; and

1. The previous Certified EIR contains a complete and accurate reporting of the environmental impacts associated with the Project; and

2. The previous Certified EIR was completed in compliance with CEQA and the Guidelines promulgated thereunder; and

3. The previous Certified EIR reflects the independent judgment of the Planning Commission; and

4. The proposed Development Agreement for the Project will introduce no new significant environmental impacts beyond those previously analyzed in the previous Certified EIR, and all mitigation measures previously adopted with the Certified EIR, are incorporated herein by this reference.

B. Find that the provisions of Development Agreement 2026-002 are:

1. Consistent with the General Plan or any applicable specific plan;

2. Compatible with the uses authorized in, and the regulations prescribed for the land use district in which the real property is located; and

3. Not detrimental to the public health, safety and welfare.

C. Move to waive the reading of Ordinance No. 579 in its entirety and read by title only.

D. Move to introduce Ordinance No. 579 approving Development Agreement 2026-002 between the Town of Apple Valley and COV Apple Valley, LLC.

E. Direct Staff to file a Notice of Determination.

Mayor Nassif opened the Public Hearing at 8:47 pm.

Lindy Daugherty - Economic Development Specialist II, presented the staff report as filed with the Town Clerks office.

PUBLIC COMMENTS
Louie Lopez

August 25, 2026, Town Council Meeting
8 Amy Smith
Jonnie Escobedo
Mayor Nassif Closed the Public Hearing at 8:55.

Kiel Mangerino, Town Clerk read the Title of Ordinance numbers 579 Motion by: Council Member Cusack
Seconded by: Council Member Emick
A. Find that the environmental impacts of this Project were previously reviewed in conjunction with the Apple Valley 143 Project Environmental Impact Report (State Clearinghouse No. 2022070019) which was certified by the Planning Commission on November 15, 2023. This Development Agreement is consistent with the previously Certified Environmental Impact Report (the “Certified EIR”) and introduces no new significant environmental impacts; and
B. Find that the provisions of Development Agreement 2026-002 are:

C. Move to waive the reading of Ordinance No. 579 in its entirety and read by title only.

Yes (5): Mayor Nassif, Council Member Emick, Council Member Bishop, Council Member Cusack, and Mayor Pro Tem Leon
Carried (5 to 0)
Motion by: Council Member Cusack
Seconded by: Mayor Pro Tem Leon
D. Move to introduce Ordinance No. 579 approving Development Agreement 2026-002 between the Town of Apple Valley and COV Apple Valley, LLC.

E. Direct Staff to file a Notice of Determination.

Yes (5): Mayor Nassif, Council Member Emick, Council Member Bishop, Council Member Cusack, and Mayor Pro Tem Leon
Carried (5 to 0)

August 25, 2026, Town Council Meeting
9 8. Business of the Council

9. Reports, Requests and Communications

10. Town Manager’s Comments & Legislative Update
Town Manager, Guy Eisenbrey, commented on upcoming events in the Town of Apple Valley.

11. Closed Session
Motion by: Mayor Pro Tem Leon
Seconded by: Council Member Emick
To Adjourn the regular meeting to move into Closed Session at 8:59 pm to discuss the following:

Carried

11.1 CLOSED SESSION
A. PUBLIC EMPLOYEE PERFORMANCE EVALUATION (120 DAY)
Title: Town Manager
Mayor Nassif confirmed there was no reportable action taken during closed session

12. Adjournment
Motion by: Council Member Cusack
Seconded by: Council Member Bishop
To adjourn the meeting of the Apple Valley Town Council in Honor of Dolly Parton at 10:00 pm.

Carried
__________________________
Scott Nassif, Mayor
_____________________________
Kiel Mangerino, Acting Town Clerk

Town Council Agenda Report
Date: September 8, 2026
To: Honorable Mayor and Town Council
Subject: APPROVAL OF RESOLUTION NUMBER 2026-30 OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA,
AMENDING RESOLUTION NO. 2024-31 AND APPROVING AN

AMENDED CONFLICT OF INTEREST CODE
From: Guy Eisenbrey, Town Manager
Submitted by: Kiel Mangerino, Acting Town Clerk
Town Clerk
Budgeted Item: Yes No N/A

RECOMMENDED ACTION
That the Town Council adopt Resolution Number 2026-30 - A Resolution of the Town Council of the Town of Apple Valley, California, Approving an Amended Conflict of Interest Code Pursuant to the Political Reform Act of 1974.

SUMMARY:

The Political Reform Act requires that local government agencies “Code Reviewing Body”, i.e. the Town Council, must notify each Town agency to review its Conflict-ofInterest Code each even-numbered year.

On June 9, 2026, the Town Council received notice of the Town’s intent to conduct a review of its conflict-of-interest code to determine if it is accurate. The Town Manager has reviewed the code as directed by the Town Council at that meeting and has recommended that various changes be made to include additional designated positions to this code and removal of obsolete positions per the Apple Valley Classification Plan.

The amended list is attached to this document as the Appendix.

ATTACHMENTS
A. Resolution 2026-30
B. Conflict of Interest Code

RESOLUTION NO. 2026-30

A RESOLUTION OF THE TOWN COUNCIL OF THE TOWN

OF APPLE VALLEY, CALIFORNIA, APPROVING AN

AMENDED CONFLICT OF INTEREST CODE PURSUANT
TO THE POLITICAL REFORM ACT OF 1974
WHEREAS, the State of California enacted the Political Reform Act of 1974, Government Code Section 81000, et seq. (the "Act"), which contains provisions relating to conflicts of interest which potentially affect all officers, employees and consultants of the Town of Apple Valley (the "Town"), and requires all public agencies to adopt and promulgate a conflict of interest code; and WHEREAS, the Town Council adopted a Conflict of Interest Code (the "Code") which was amended on September 24, 2024, in compliance with the Act; and WHEREAS, subsequent changed circumstances within the Town have made it advisable and necessary pursuant to Sections 87306 and 87307 of the Act to amend and update the Town's Code; and
WHEREAS, notice of the time and place of a public meeting on, and of consideration by the Town Council of, the proposed amended Code was provided to each affected designated position and was publicly posted for review at the offices of the Town; and
WHEREAS, a public meeting was held upon the proposed amended Code at a regular meeting of the Town Council on September 8, 2026, at which all present were given an opportunity to be heard on the proposed amended Code.

NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Apple Valley, California, as follows:

Section 1. The Town Council does hereby approve and adopt the proposed amended Conflict of Interest Code, a copy of which is attached hereto and shall be on file with the Town Clerk and available to the public for inspection and copying.

Section 2. The said amended Conflict of Interest Code shall become effective at the time of its adoption and approval.

Resolution 2026-30
APPROVED and ADOPTED by the Town Council of the Town of Apple Valley, California, at a regular meeting thereof held this 8
th day of September 2026.
_____________________
Scott Nassif, Mayor
Attest:
____________________________
Kiel Mangerino, Acting Town Clerk

CONFLICT OF INTEREST CODE OF THE

TOWN OF APPLE VALLEY
(Amended September 8, 2026)
The Political Reform Act (Government Code Section 81000, et seq.) requires state and local government agencies to adopt and promulgate conflict of interest codes. The Fair Political Practices Commission has adopted a regulation (2 Cal. Code of Regs. 18730) which contains the terms of a standard conflict of interest code which can be incorporated by reference in an agency's code. After public notice and hearing it may be amended by the Fair Political Practices Commission to conform to amendments in the Political Reform Act. Therefore, the terms of 2 Cal. Code of Regs. Section 18730 and any amendments to it duly adopted by the Fair Political Practices Commission are hereby incorporated by reference. This incorporation page with Regulation 18730 and the attached Appendix designating positions and establishing disclosure categories shall constitute the Conflict of Interest Code of the Town of Apple Valley (the"Town").

All Officials and Designated Positions required to submit a statement of economic interests shall file their Statement of Economic Interest with the Town Clerk as the Town's Filing Officer. The Town Clerk shall make and retain a copy of all statements filed by the Mayor, members of the Town Council, the Town Manager, the Town Attorney, the Town Treasurer/Assistant Town Manager, and members of the Planning Commission and forward the originals of such statements to the Fair Political Practices Commission. The Town Clerk shall retain the originals of the statements for all other Officials and Designated Positions and shall make all retained statements available for public inspection and reproduction during regular business hours (Gov. Code section 81008).

APPENDIX

CONFLICT OF INTEREST CODE OF THE

TOWN OF APPLE VALLEY
(Amended September 27, 2022)
PART "A"
The Mayor, Members of the Town Council and Planning Commission, the Town Manager, the Town Attorney, the Town Treasurer, and all other Town Officials who manage public investments as defined by 2 Cal. Code of Regs. § 18700.3(b), are NOT subject to the Town's Conflict of Interest Code but must file disclosure statements under Government Code Section 87200 et seq.. [Regs. § 18730(b)(3)]

OFFICIALS WHO MANAGE PUBLIC INVESTMENTS
It has been determined that the positions listed below are officials who manage public investments.1These positions are listed here for informational purposes only.

Controller
Financial Consultant
Individuals holding one of the above-listed positions may contact the Fair Political Practices Commission for assistance or written advice regarding their filing obligations if they believe that their position has been categorized incorrectly. The Fair Political Practices Commission makes the final determination whether a position is covered by § 87200.

DESIGNATED POSITIONS

GOVERNED BY THE CONFLICT OF INTEREST CODE

DESIGNATED POSITIONS TITLE OR FUNCTION DISCLOSURE CATEGORIES ASSIGNED Administrative Analyst I and II 6
Animal Services Manager 6
Assistant Director, Community Development 1, 2
Assistant Director, Economic Development & Housing 1, 2 Assistant Planner 1, 2
Assistant Town Clerk 6
Assistant Town Manager 1, 2
Associate Planner 1, 2
Building Official 2, 3, 6, 7
Code Enforcement Manager 6
Community Development Director 6
Deputy Town Engineer 2, 3, 6, 7
Director of Animal Services 6
Director of Business Dev. and Communications 6
Director of Community Development 6
Director of Government Services 6
Director of Innovation and Technology 6
Director of Municipal Services 6
Director of Planning 6
Director of Public Works 2, 3, 6
Economic Development Specialist 1 6
Economic Development Specialist 2 6
Emergency Services Officer 6
Entertainment Production Supervisor 6
Event Coordinator 1
Finance Analyst 5
Finance Manager 5
Golf Course Supervisor 6
Ground Services Supervisor 6
Housing & Community Dev. Specialist I and II 2,3,6
Housing Programs Supervisor 2,3,6
Human Resources Analyst 6
Human Resources Manager 6
Human Resources Payroll Coordinator 6
Innovation and Technology Analyst 6

Innovation and Technology Coordinator 6
Innovation and Technology GIS Specialist 6
Innovation and Technology Officer 6
Innovation and Technology Supervisor 6
Innovation and Technology Specialist 6
Innovation and Technology Technician 6
Maintenance Supervisor 6
Parks & Recreation Manager 2,6
Parks & Recreation Director 2,6
Planning Manager 1, 2
Principal Planner 1, 2
Public Information Officer 6
Public Works Manager 2, 3,6
Recreation Supervisor 6
Senior Planner 1, 2
Special Projects Manager 6
Town Attorney (not filing under Gov Code§ 87200) 1, 2
Town Clerk 6
Town Engineer 2, 3,6, 7

MEMBERS OF BOARDS,

COMMITTEES AND COMMISSIONS
Parks & Recreation Commission
Traffic Committee
1, 2
1, 2
Consultants and New Positions 2
2 Individuals providing services as a consultant as defined in FPPC Reg. 18700.3(a) or in a new position created since this Code was last approved that makes or participates in making decisions, shall disclose pursuant to the broadest disclosure category in this Code subject to the following limitation:

The Town Manager may determine in writing that, due to the range of duties or contractual obligations, it is more appropriate to designate a limited disclosure requirement. A clear explanation of the duties and a statement of the extent of the disclosure requirements must be in a written document (Gov. Code Sec. 82019; FPPC Regulations 18219 and 18734). The Town Manager's determination is a public record and shall be retained for

public inspection in the same manner and location as this Conflict of Interest Code. (Gov.

Code Sec. 81008.)

APPENDIX PART "B"

DISCLOSURE

CATEGORIES
The disclosure categories listed below identify the types of investments, business entities, sources of income, including gifts, loans and travel payments, or real property which the Designated Position must disclose for each disclosure category to which he or she is assigned.3 "Investment" means financial interest in any business entity (including a consulting business or other independent contracting business) and are reportable if they are either located in or doing business in the jurisdiction, are planning to do business in the jurisdiction, or have done business during the previous two years in the jurisdiction of the Town.

Category 1: All investments and business positions in business entities, and sources of income, including gifts, loans and travel payments, that are located in, do business in, or own real property within the jurisdiction of the Town.

Category 2: All interests in real property which is located in whole or in part within, or not more than two (2) miles outside, the jurisdiction of the Town.

Category 3: All investments and business positions in business entities, and sources of income, including gifts, loans and travel payments, that are engaged in land development, construction or the acquisition or sale of real property within the jurisdiction of the Town.

Category 4: All investments and business positions in business entities, and sources of income, including gifts, loans and travel payments, that are engaged in banking, savings and loan, or other financial institutions or insurance companies.

Category 5: All investments and business positions in business entities, and sources of income, including gifts, loans and travel payments, that provide services, supplies, materials, machinery, vehicles or equipment of a type utilized by the Town.

Category 6: All investments and business positions in business entities, and sources of income, including gifts, loans and travel payments, that provide services, supplies, materials, machinery, vehicles or equipment of a type purchased or leased by the Designated Position's department, unit, or division.

Category 7: All investments and business positions in business entities, and sources of income, including gifts, loans and travel payments that are subject to the regulatory, permit or licensing authority of the Designated Position's department, unit, or division.

This Conflict of Interest Code does not require the reporting of gifts from outside this agency's jurisdiction if the source does not have some connection with or bearing upon the functions of

the position. (Reg. 18730.1)

Town Council Agenda Report
Date: September 8, 2026
To: Honorable Mayor and Town Council
Subject: AWARD THE CONTRACT FOR THE CONSTRUCTION OF THE

APPLE VALLEY GOLF COURSE MONUMENT SIGN AND

LANDSCAPE PROJECT
From: Guy Eisenbrey, Town Manager
Submitted by: Debbie Rivera, Director of Parks and Recreation Parks and Recreation Department
Budgeted Item: Yes No N/A

RECOMMENDED ACTION
That the Town Council:

A. Award the contract for the construction of the Apple Valley Golf Course Monument Sign and Landscape Project to No Limit Construction in the amount of $135,000; B. Authorize the Town Manager or designee to execute the contract and any necessary related documents;
C. Approve a 10% project contingency in the amount of $13,500, for a total project budget of $148,500; and
D. Approve a budget amendment increasing appropriations by $98,500 to the Golf Course Capital Improvement Project Fund, Account 57106035-750100, to provide sufficient funding for the project and contingency.

SUMMARY
The Parks & Recreation Department is requesting Town Council approval to award a construction contract to No Limit Construction for the Apple Valley Golf Course Monument Sign and Landscape Project in the amount of $135,000.

The project will improve the appearance and functionality of the golf course entrance and parking lot area. Improvements will include replacement of damaged curbing, installation of two new monument signs with uplighting, and natural landscaping around the entrance area.

A formal bid opening was conducted on August 10, 2026, at 10:00 a.m. Two bids were received:

Contractor Bid Amount
No Limit Construction $135,000.00
Cornerstone Construction $148,686.00
No Limit Construction submitted the lowest bid, which was $13,686 less than the next lowest bid submitted by Cornerstone Construction.

Staff recommends awarding the contract to No Limit Construction.

BACKGROUND
The Apple Valley Golf Course is an important community asset and has been in operation since 1948. The existing golf course entrance sign is the original Country Club sign and has remained in place for many years. The sign is relatively small and does not provide lighting, which limits its visibility, particularly during evening hours and when the facility is hosting events or other activities. Replacing the existing sign with larger monument signage and uplighting will improve visibility and provide a more prominent and welcoming entrance to the golf course.

The entrance and parking lot areas are visible to golfers, residents, and visitors. Over time, portions of the existing curbing have become damaged, and the entrance area would benefit from updated signage and landscaping.

The proposed project will include:
 Replacement of damaged curbing;
 Installation of two new monument signs, one on each side of the parking lot;  Installation of uplighting for the new monument signs; and  Installation of natural landscaping around the monument signs and entrance areas.

The project was formally advertised for bids, with the bid opening held on August 10, 2026. Following review of the bids received, staff recommends awarding the project to No Limit Construction as the lowest bidder.

VISION ALIGNMENT
The Apple Valley Golf Course Landscape and Monument Sign Project supports the Town of Apple Valley’s vision of maintaining attractive, well-designed, and welcoming public facilities that enhance the community’s quality of life. The project will improve the appearance and functionality of the golf course entrance through upgraded curbing, new monument signage with uplighting, and natural landscaping. These improvements will create a more inviting and professional first impression for residents, golfers, and visitors while investing in the long-term appearance and value of an important Town recreational facility.

FISCAL IMPACT
The total project budget requested is $148,500, consisting of:
 Construction Contract: $135,000

 10% Contingency: $13,500
 Total Project Budget: $148,500
The Golf Course Capital Improvement Fund currently has $50,000 available for this project. Staff is requesting approval of a $98,500 budget amendment to increase appropriations in Account 57106035-750100, to provide the additional funding needed for the $135,000 construction contract and the recommended 10% contingency of $13,500. The total project budget will be $148,500.

ATTACHMENTS
A. Contract with No Limit Construction
B. Concept Site Plan for Apple Valley Golf Course Monument Sign and Landscape Project
C. Rendering of Monument Sign
D. Budget Amendment Request

SECTION 400 - CONTRACT FOR CONSTRUCTION
THIS CONTRACT is made this 8th day of September, 2026, in San Bernardino County, State of California, by and between the Town of Apple Valley, hereinafter called Town, and NoLimit Construction, hereinafter called Contractor. Town and Contractor agree, for valuable consideration, as follows:

ARTICLE 1. SCOPE OF WORK. The Contractor shall perform all Work and provide all labor, materials, equipment, tools, utility services, and transportation to complete all of the Work required in strict compliance with the Contract Documents (specified in Article 5 below) for the public work of improvement titled:

Apple Valley Golf Course Monument Sign and Landscape Project The Contractor and its surety shall be liable to the Town for any damages arising as a result of the Contractor’s failure to comply with this obligation.

ARTICLE 2. CONTRACT TIME. Time is of the essence in the performance of the Work. The Work shall be commenced on the date stated in the Town’s Notice to Proceed. The Contractor shall complete all Work required by the Contract Documents within Sixty (60) Working Days from the commencement date stated in the Notice to Proceed, hereafter the Contract Time. By its signature hereunder, Contractor agrees the Contract Time is adequate and reasonable to complete the Work.

ARTICLE 3. CONTRACT PRICE. The Town shall pay to the Contractor as full compensation for the performance of the Contract, subject to any additions or deductions as provided in the Contract Documents, and including all applicable taxes and costs, the sum of One hundred and thirty-five thousand Dollars ($135,000.00), hereinafter, the Contract Price. Payment shall be made as set forth in the General Conditions.

ARTICLE 4. LIQUIDATED DAMAGES. Contractor acknowledges that Town will sustain actual damages for each and every Working Day completion of the Project is delayed beyond the Contract Time. Because of the nature of the Project, it would be impracticable or extremely difficult to determine the Town’s actual damages. Accordingly, as provided in Government Code section 53069.85, it is agreed that the Contractor will pay the Town the sum of $500.00 for each and every Working Day of delay in completing the Work beyond the Contract Time, as Liquidated Damages and not as a penalty or forfeiture. In the event the Liquidated Damages are not paid, Town may deduct that amount from any money due or that may become due the Contractor under the Contract. This Article does not affect the Town’s rights to other damages or remedies specified in the Contract Documents or allowed by law.

Should Contractor be inexcusably delayed in the performance of the Work, Town may deduct liquidated damages based on its estimate of when Contractor will achieve Final Completion or other Milestones. Town need not wait until Final Completion to withhold liquidated damages from Contractor.

Liquidated damages are not a penalty but an agreed estimate of the actual damages that would be sustained by the Town for delay, including but not limited to loss of revenue, inconvenience to the Town and the public, and increased Project administration expenses such as extra inspection,

construction management, staff time, and architectural and engineering expenses. Liquidated damages do not include damages the Town incurs on account of claims by third parties against the Town on account of any delay.

Should money due or to become due to Contractor be insufficient to cover liquidated damages or other offsets due, then Contractor forthwith shall pay the remainder of the assessed liquidated damages to Town.

ARTICLE 5. COMPONENT PARTS OF THE CONTRACT. The “Contract Documents” include only the following documents, each of which is incorporated into this Contract for Construction by reference:

Notice Inviting Bids
Instructions to Bidders
Contractor's Bid Forms
Contractor’s Certificate Regarding Workers’ Compensation Bid Bond
Designation of Subcontractors
Information Required of Bidders
Non-Collusion Declaration Form
Iran Contracting Act Certification
Public Works Contractor Registration Certification
California Air Resources Board – Fleet Compliance Certification Performance Bond
Payment (Labor and Materials) Bond
General Conditions
Special Conditions
Technical Specifications
Standard Specifications
Addenda
Plans prepared
Change Orders executed by Town
The Contactor shall complete the Work in strict accordance with all of the Contract Documents.

All of the Contract Documents are intended to be complementary. Work required by one of the Contract Documents and not by others shall be done as if required by all. In the event of a conflict, the various Contract Documents will be given effect in the order set forth in Article 2.b of the General Conditions.

This Contract constitutes the full and complete agreement between the parties with regard to the Project and the Work, and supersedes any prior agreement of the parties, whether written or oral.

The Contract can be modified only by a written Change Order executed in accordance with the Contract Documents.

ARTICLE 6. PROVISIONS REQUIRED BY LAW. Each and every provision of law required to be included in these Contract Documents shall be deemed to be included in these Contract Documents. The Contractor shall comply with all requirements of applicable federal, state and local laws, rules and regulations, including, but not limited to, the provisions of the California Labor Code and California Public Contract Code which are applicable to this Work.

ARTICLE 7. INDEMNIFICATION. Contractor shall provide indemnification and defense as set forth in the General Conditions.

ARTICLE 8. PREVAILING WAGES. Contractor shall pay not less than the prevailing rate of wages in accordance with the Labor Code, which rates have been determined by the Director of the California Department of Industrial Relations and shall be made available at the office of the Town Clerk or may be obtained online at http//www.dir.ca.gov/dlse.

If the Work involves federal funds or otherwise requires compliance with the Davis-Bacon Fair Labor Standards Act, the Contractor and all its subcontractors shall pay the higher of the state or federal prevailing wage rates.

The wage rates must be posted at the job site.
[SIGNATURES ON FOLLOWING PAGE]

IN WITNESS WHEREOF, this Contract has been duly executed by the above-named parties, on the day and year above written.

TOWN OF APPLE VALLEY NoLimit Construction
By: By:

Scott Nassif Sergio Duarte
Mayor Owner
ATTEST:

Kiel E. Mangerino, Acting Town Clerk
APPROVED AS TO CONTENT:
___________________________
Guy Eisenbrey, Town Manager
APPROVED AS TO FORM:

BEST BEST & KRIEGER LLP
__________________________
Thomas Rice, Town Attorney

END OF CONTRACT

QUEEN VICTORIA AGAVE

BARREL CACTUS

RED YUCCA

CLEVELAND SAGE

LYNN'S TEXAS SAGE

EXISTING TREE

YELLOW YUCCA

PROSTRATE ACACIA

HUNTINGTON CARPET ROSEMARY
LEGEND

MONUMENT SIGN, PER FINAL
CONCEPTUAL DRAWINGS.

NEW 6" CURB AROUND THE PERIMETER OF ALL
MONUMENT SIGN, PER FINAL PLANTERS.

CONCEPTUAL DRAWINGS.

EXISTING PARING TO BE RE-STRIPED, DOUBLE HAIRPIN.

NEW 6" CURB AROUND THE PERIMETER OF ALL
PLANTERS.

NEW LANDSCAPING TO MATCH THE BUFFALO TRADING

POST FRONTAGE LANDSCAPING, SEE PLANT LEGEND
FOR SPECIES AND GROUND COVER TYPE.

NEW LANDSCAPING TO MATCH THE BUFFALO TRADING

POST FRONTAGE LANDSCAPING, SEE PLANT LEGEND
FOR SPECIES AND GROUND COVER TYPE.

NEW LANDSCAPING TO MATCH THE BUFFALO TRADING

POST FRONTAGE LANDSCAPING, SEE PLANT LEGEND
FOR SPECIES AND GROUND COVER TYPE.

EXISTING PARKING TO BE RE-STRIPED
OPTIONAL: DECORATIVE ENTRY TO MATCH THE
BUFFALO TRADING POST ENTRY.

DIRECTIONAL ARROWS TO BE RE-STRIPED
PER THE TOWN'S DEVELOPMENT CODE.

OPTIONAL: DECORATIVE ENTRY TO MATCH THE
BUFFALO TRADING POST ENTRY.

DIRECTIONAL ARROWS TO BE RE-STRIPED
PER THE TOWN'S DEVELOPMENT CODE.

RANCHERIAS RD
NO

PARKING
NO

PARKING
NO

PARKING

SEE DEMO SHEET SEE DEMO SHEET

APPLE VALLEY PUBLIC GOLF COURSE SITE PLAN

APPLE VALLEY

PUBLIC GOLF COURSE

RESTAURANT

RESTAURANT

APPLE VALLEY

PUBLIC GOLF COURSE

RESTAURANT

RESTAURANT

ELEVATIONS

APPLE VALLEY PUBLIC GOLF COURSE ENTRY MONUMENT SIGN
SCALE 1” = 1’-0”

TOP VIEW

DECORATIVE GRAVEL AREA

WITH SIGN LIGHTING

SIGNAGE

DECORATIVE CAP

WOOD PANELING

DECORATIVE STONE
7'-5"
6 '
0 -
"
4' 3-
"
1 2'-0" 3'-0"
1 '-1 1 " 1 '-1 1 "
2' 6-
"
1 ' 9-
"

Town Council Agenda Report
Date: September 8, 2026
To: Honorable Mayor and Town Council
Subject: ADOPT ORDINANCE NO. 577 TO CHANGE THE ZONING OF PARCELS 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 AND 0472-301-01 FROM OFFICE PROFESSIONAL (O-P) TO

REGIONAL COMMERCIAL (C-R) AND ADDING THE I-N INDUSTRIAL ECOMMERCE OVERLAY AND AMENDING TITLE 9, SECTION

9.35.020.D AND TABLE 9.35.030-A, FOOTNOTE 7, OF THE TOWN OF

APPLE VALLEY MUNICIPAL CODE, TO EXPAND THE I-N

ECOMMERCE OVERLAY BOUNDARY EASTWARD TO INCLUDE
THE APPLE VALLEY 84 PROJECT SITE AND REVISE THE I-N
OVERLAY ACREAGE FROM 978 TO 1,071 ACRES.

From: Guy Eisenbrey, Town Manager
Submitted by: David Contreras, Planning Director
Planning Department
Budgeted Item: Yes No N/A

RECOMMENDED ACTION
Adopt Ordinance No. 577, an Ordinance of the Town Council of the Town of Apple Valley, amending the zoning of Parcels 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, - 21 and 0472-301-01 from Office Professional to Regional Commercial on the Town of Apple Valley Zoning Map and amending Town of Apple Valley Development Code Sectoin 9.35.020.D and Table 9.35.030-A, Footnote 7, to expand the I-N overlay boundary eastward to include the Apple Valley 84 project site and revise the overlay’s acreage from 978 acres to 1,071 acres.

BACKGROUND
The Town Council reviewed and introduced Ordinance No. 577 at its August 25, 2026 regular meeting. Ordinance No. 577 has been scheduled for adoption at the September 8, 2026 regular meeting of the Town Council.

FISCAL IMPACT
No foreseable fiscal impact.

ATTACHMENT
A. Ordinance No. 577 adopting Zone Change (ZC) 2024-007 and Development Code Amendment (DCA) 2024-001
B. Exhibit A: Proposed Amendment to the Town of Apple Valley Official Zoning Map C. Exhibit B: Town of Apple Valley Amendment of Development Code Section

9.35.020.D and Table 9.35.030.A, Footnote 7

ORDINANCE NO. 577
1 ORDINANCE NO. 577

AN ORDINANCE OF THE TOWN COUNCIL OF THE TOWN OF

APPLE VALLEY, CALIFORNIA, ADOPTING ZONE CHANGE ZC
2024-007 FOR THE APPLE VALLEY 84 PROJECT SITE
(PARCELS 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, - 21 AND 0472-301-01) FROM OFFICE PROFESSIONAL (O-P) TO

REGIONAL COMMERCIAL (C-R) AND I-N INDUSTRIAL

ECOMMERCE OVERLAY AND ADOPTING DEVELOPMENT
CODE AMENDMENT DCA 2024-001 TO MODIFY CODE SECTION

9.35.020.D AND TABLE 9.35.030-A, FOOTNOTE 7, TO EXPAND

THE OVERLAY BOUNDARY EASTWARD TO INCUDE THE

PROJECT SITE AND REVISE THE ECOMMERCE OVERLAY
ACREAGE FROM 978 TO 1,071 ACRES
WHEREAS, Title 9 "Development Code" of the Municipal Code of the Town of Apple Valley was adopted by the Town Council on April 27, 2010, and has been previously modified from time-to-time by the Town Council on the recommendation of the Planning Commission; and
WHEREAS, the Apple Valley 84 Logistics Center Project (“Project”) has been proposed by Apple 84 LLC to construct a 1.38 million square foot eCommerce warehouse and distribution center on approximately 93 acres of land bounded by future Wrangler Road to the west, vacant lands and future Johnson Road to the north, Stoddard Wells Road to the south and by vacant lands to the east in the northwest part of the Town (Assessor Parcel Numbers 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 and 0472-301-01); and
WHEREAS, the project includes a request for General Plan Amendment GPA 2024-001, Development Code Amendment DCA 2024-001, Zone Change ZC 2024-007, Vesting Tentative Map No. 21034, Development Permit DP 2025-013, and Development Agreement 2026-003; and
WHEREAS, Development Code Amendment DCA 2024-001 and Zone Change ZC 2024-007 are consistent with the General Plan and Municipal Code of the Town of Apple Valley, including the General Plan Land Use Element Goals and Policies and the Town of Apple Valley Development Code, and shall promote the health, safety and general welfare of the citizens of the Town of Apple Valley; and WHEREAS, pursuant to Public Resources Code Section 21067 and State CEQA Guidelines Section 15367, a Draft Environmental Impact Report (“Draft EIR”) was prepared that determined that mitigation measures are required to mitigate impacts to a less than significant level for Air Quality, Biological Resources, Cultural Resources, Geology and Soils and Tribal Cultural Resources; and

ORDINANCE NO. 577
2 WHEREAS, the Draft EIR concluded that, despite the incorporation of all feasible mitigation measures, the proposed Project would result in significant and unavoidable impacts relating to Greenhouse Gas Emissions and Transportation; and WHEREAS, as required by State CEQA Guidelines Section 15087(a), the Town published Notice of Availability of the Draft EIR on January 13, 2026, circulated the Draft EIR for a 45-day public review and comment period commencing on January 13, 2026 and expiring on February 27, 2026 and made physical copies of the Draft EIR and all associated technical appendices available for public review at Apple Valley Town Hall, on the Town environmental web page and at the San Bernardino County Public Library; and
WHEREAS, the Town prepared a Final EIR consisting of all comments received on the Draft EIR, written responses to those comments, and clarifications and revisions to the Draft EIR; and
WHEREAS, on June 25, 2026, the Town published the Final EIR, Mitigation Monitoring and Reporting Program, Statement of Overriding Considerations and Findings of Fact and sent notifications to all commenting agencies providing access to the published electronic version of the Final EIR and all associated CEQA-related documents; and
WHEREAS, a Statement of Overriding Considerations has been prepared weighing the project’s unavoidable environmental risks against the overriding economic, legal, social, technological and other benefits justifying Project Approval, and documenting why the Town believes the Project's advantages justify accepting environmental harm; and
WHEREAS, all mitigation measures identified in the EIR and necessary to reduce the potentially significant impacts of the proposed Project to less than significant levels are set forth in a Mitigation Monitoring and Reporting Program (MMRP); and
WHEREAS, the EIR reflects the independent judgment of the Town and is deemed adequate for purposes of making decisions on the merits of the Project; and WHEREAS, On July 15, 2026, the Planning Commission of the Town of Apple Valley conducted a duly noticed and advertised public hearing for Development Code Amendment DCA 2024-001 and Zone Change 2024-007, receiving testimony from the public and adopted Planning Commission Resolutions recommending adoption of Development Code Amendment DCA 2024-001 and Zone Change 2024-007; and WHEREAS, On August 14, 2026, DCA 2024-001 and ZC 2024-007 were duly noticed in Apple Valley News, a newspaper of general circulation within the Town of Apple Valley for a Public Hearing before the Town of Apple Valley Town Council.

ORDINANCE NO. 577
3 WHEREAS, On August 25, 2026, the Town Council of the Town of Apple Valley conducted a duly noticed and advertised public hearing for Development Code Amendment DCA 2024-001 and Zone Change 2024-007, receiving testimony from the public, and
WHEREAS, the Findings and conclusion made by the Town Council pursuant to this Ordinance are based upon the oral and written evidence presented to it as a whole and the entirety of the administrative record for the Project, which are incorporated herein by this reference, and not based solely on information provided in this Ordinance; and
WHEREAS, prior to taking action, the Town Council had heard, been presented with, reviewed and considered all of the information and data in the administrative record, including but not limited to the Draft EIR, the Final EIR, comments received, recommendations by staff, public testimony, and the Mitigation Monitoring and Reporting Program; and
WHEREAS, no comments made in the public hearing conducted by the Town Council, and no additional information submitted to the Town, have produced substantial new information requiring substantial revisions that would cause recirculation of the EIR or additional environmental review of the proposed Project under State CEQA Guidelines section 15073.5; and
WHEREAS, copies of the Draft and Final Environmental Impact Reports and all other project-related documents, may be viewed at the Town of Apple Valley Development Services Building, Planning Division, 14955 Dale Evans Parkway, Apple Valley, CA 92307, and
WHEREAS, all legal prerequisites to the adoption of this Resolution have occurred.

NOW, THEREFORE, the Town Council of the Town of Apple Valley, State of California, does ordain as follows:

SECTION 1. The recitals above are true and correct and are hereby incorporated herein by this reference.

SECTION 2. The Town Council has reviewed and considered the EIR and administrative record for the Project, including all oral and written comments received during the comment period.

A. The Town Council finds that the EIR and the administrative record have been completed in compliance with CEQA, the State CEQA Guidelines, and the Town's Local CEQA Guidelines.

ORDINANCE NO. 577
4 B. Based on the whole record before it, including, without limitation, the EIR and the administrative record, including all written and oral evidence presented to the Town Council, the Town Council finds that all environmental impacts of the Project are less than significant with mitigation. The Town Council further finds that there is no substantial evidence in the administrative record supporting a fair argument that the Project may result in significant environmental impacts.

The Town Council finds that the EIR contains a complete, objective and accurate reporting of the environmental impacts associated with the Project and reflects the independent judgment and analysis of the Town Council.

C. No new significant environmental effects have been identified in the EIR and any changes to the Final EIR, including modification of mitigation measures in response to comments or otherwise, do not constitute substantial revisions requiring recirculation under State CEQA Guidelines Section 15073.5.

D. The Town Council certifies the Final EIR for the proposed Apple Valley 84 Project, including Development Code Amendment DCA 2024-001 and Zone Change ZC 2024-007, pursuant to Public Resources Code Section 21080, subdivision (c).

E. Pursuant to Public Resources Code Section 21081.6, the Town Council approves and adopts the Mitigation Monitoring and Reporting Program prepared for the Project.

F. The Town Council directs staff to file a Notice of Determination with the San Bernardino County Clerk’s Office and with the Governor’s Office of Land Use and Climate Innovation State Clearinghouse within five (5) working days of approval of the Project.

SECTION 3. Based upon substantial evidence presented to this Council during the above-referenced hearing, including public testimony and written and oral staff reports, the Town Council of the Town of Apple Valley, California, finds and determines that the changes proposed by Development Code Amendment DCA 2022-003 and Zone Change ZC 2022-005 are consistent with the Goals and Policies of the Town of Apple Valley adopted General Plan, as required under TOAV Code Section 9.06.060:

1. The proposed Amendments are consistent with the General Plan; FACTS: The proposed Amendments are consistent with the General Plan as this action would align the proposed project’s uses with the appropriate General Plan Land Use Designation for such uses and it would implement the Town’s broader long-term vision for the area, which is better suited for logistics warehousing than office uses given the site’s close proximity to Interstate 15. In addition, surrounding abutting properties are already designated as Regional Commercial and the proposed land use designation changes would add contiguous lands to the

ORDINANCE NO. 577
5 “Regional Commercial” designated area. A similar project was approved for lands immediately west of and abutting the project site in 2023. The proposed amendment supports and furthers the Goals, Policies and Standards as stated in the General Plan.

2. The proposed Amendments will not be detrimental to the public health, safety or welfare of the Town or its residents.

FACTS: The proposed Amendments will not be detrimental to the public health, safety or welfare of the Town or its residents because the project would extend all required utilities to the project site and would construct surrounding streets, curb, gutter and sidewalks, thus providing services to the area and facilitating future emergency response needs. Further, the area being considered for amendment is contiguous with lands to the west that area already designated as “Regional Commercial” and this amendment expands that area. The project site is better suited for logistics and warehousing rather than office uses, due to the site’s close proximity to Interstate 15, which lies approximately one-half mile to the west.

SECTION 4. Section 9.35.020.D and Table 9.35.030.A, Footnote 7 of the Town of Apple Valley Municipal Code are hereby amended as described in Exhibit B of this Ordinance.

SECTION 5. Based upon the facts presented within the staff analysis, public testimony and pursuant to Government Code Section 65863(b), the Town Council of the Town of Apple Valley, California, finds that the proposed land use designation is consistent with the General Plan goals and policies.

SECTION 6. Amend the Official Zoning District Map as shown on Exhibit "A".

ORDINANCE NO. 577
6 APPROVED and ADOPTED by the Town Council of the Town of Apple Valley and signed by the Mayor and attested by the Town Clerk this 8th day of September 2026. __________________________
Scott Nassif, Mayor
ATTEST:
_________________________________
Kiel E. Mangerino, Acting Town Clerk

APPROVAL AS TO CONTENT
____________________________
Guy Eisenbrey, Town Manager

APPROVAL AS TO FORM
___________________________
Thomas Rice, Town Attorney

EXHIBIT A: Proposed Amendment to the Town of Apple Valley OƯicial Zoning Map

EXHIBIT B: Town of Apple Valley Development Code Amendment Draft Amendment to Development Code Section 9.35.020.D
“The C-R district is intended for the development of a full range of retail stores, offices and personal and business services on a scale to serve the needs of the Town and the surrounding region, to be located in proximity to interstate and state highways and arterial roadways. This district implements the Regional Commercial (C-R) land use designation of the General Plan. A maximum floor area ratio (F.A.R.) of 1.0 is permitted in the C-R District. A total of 978 1,071 acres within the CR District bounded by Interstate 15 (I-15) freeway to the west, Dante Road to the south and Caplet Street Cordova Road to the north, and the CR District's boundary to the east allows for eCommerce fulfillment and distribution centers.”
Draft Amendment to Dev. Code Table 9.35.030.A, Footnote 7 “In the C-R District, new eCommerce fulfillment and distribution centers shall only be allowed within the 978 1,071 acres bounded by I-15 freeway to the west, Dante Road to the south and Caplet Street Cordova Road to the north, and the CR District's boundary to the east. Any new eCommerce fulfillment and distribution centers would be subject to Site Development Standards in Section 9.35.040; Industrial Design Standards in Chapter

9.47; and Off-street parking regulations in Chapter 9.72 and Landscaping regulations in Chapter 9.75 for industrial uses/developments. Conflicts and Clarification shall be resolved as specified in Section 9.05.080.”

Town Council Agenda Report
Date: September 8, 2026
To: Honorable Mayor and Town Council
Subject: ADOPT ORDINANCE NO. 578, AN ORDINANCE OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, APPROVING A

DEVELOPMENT AGREEMENT BETWEEN THE TOWN OF APPLE
VALLEY AND APPLE 84 LLC RELATED TO THE APPLE VALLEY 84
INDUSTRIAL DEVELOPMENT PROPOSED ON 93 ACRES OF LAND
(PARCEL NUMBERS 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 AND 0472-301-01) WITHIN THE TOWN OF APPLE VALLEY, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA.

From: Guy Eisenbrey, Town Manager
Submitted by: David Contreras, Planning Director
Planning Department
Budgeted Item: Yes No N/A

RECOMMENDED ACTION
Adopt Ordinance No. 578, an Ordinance of the Town Council of the Town of Apple Valley, approving a Development Agreement between the Town of Apple Valley and Apple 84 LLC related to the Apple Valley 84 industrial development proposed on 93 acres of land (parcel numbers 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 and 0472- 301-01) within the Town of Apple Valley, County of San Bernardino, State of California.

BACKGROUND
The Town Council reviewed and introduced Ordinance No. 578 at its August 25, 2026 regular meeting. Ordinance No. 578 has been scheduled for adoption at the September 8, 2026 regular meeting of the Town Council.

FISCAL IMPACT
No foreseeable fiscal impact.

ATTACHMENT
A. Ordinance No. 578 DA 2026-003
B. Exhibit A: Proposed Development Agreement

ORDINANCE NO. 578

AN ORDINANCE OF THE TOWN COUNCIL OF THE TOWN

OF APPLE VALLEY, CALIFORNIA, APPROVING
DEVELOPMENT AGREEMENT NO. 2026-003 BETWEEN
THE TOWN OF APPLE VALLEY AND APPLE 84 LLC.

WHEREAS, the Town of Apple Valley (“Town”) is a municipal corporation, duly organized under the constitution and laws of the State of California; and WHEREAS, Article 2.5 of Chapter 4 of Division 1 of Title 7 (commencing with Section 65864) of the Government Code of the State of California (“Statute”) authorizes the Town to enter into a contract which is called a development agreement in order to establish with certainty what regulations will govern the construction of a development; and
WHEREAS, Title 9 “Development Code” of the Municipal Code of the Town of Apple Valley (“AVMC”), specifically Chapter 9.04 “Development Agreements”, establishes procedures and requirements for consideration of development agreements; and
WHEREAS, in accordance with the Statute and Chapter 9.04 of the AVMC (herein referred to collectively as the “Development Agreement Law”), the Planning Commission of the Town of Apple Valley (the “Planning Commission”) did receive Applications for a General Plan Amendment, Zone Change, Development Code Amendment, Development Permit, Tentative Parcel Map and Development Agreement from Apple 84, LLC (“Owner”) to construct a 1.38 million square foot e-commerce warehouse and distribution facility on approximately 93 acres of land (the “Proposed Project”) for that certain real property bounded by future Wrangler Road to the west, vacant lands and future Johnson Road to the north, Stoddard Wells Road to the south and by vacant lands to the east (Assessor Parcel Numbers 0472-211-01, -02, -03, -09, -10, -11, -17, -18, -19, -20, -21 and 0472- 301-01) in the Town of Apple Valley, County of San Bernardino, State of California; and WHEREAS, the Proposed Project includes requests for the following land use entitlements:

1. An Amendment to the General Plan to change the site’s land use designation from Professional Office to Regional Commercial.

2. A Zone Change to change the zoning designation from “O-P” Office Professional to “C-R” Regional Commercial.

3. A Development Code Amendment to change Code Section 9.35.020.D and Code Table 9.35.030A, Footnote 7, to include the 93-acre project area and expand the boundary of the I-N Industrial e-Commerce overlay eastward to include the project site, to revise the overlay acreage from 978 to 1,071 acres to include the

Ordinance 578

Project site, and to change the name of “Caplet Street” to “Cordova Road” in the document.

4. A Tentative Parcel Map to combine twelve (12) separate legal parcels into one consolidated parcel.

5. A Development Permit to allow development of the site.

WHEREAS, Development Agreement No. 2026-003, attached hereto as Exhibit “A,” is proposed to provide for the development of the Proposed Project and certain vested development rights for the term of the Development Agreement, and in turn the Owner would provide specified public benefits; and
WHEREAS, development of the Property in accordance with Development Agreement 2026-003 will provide substantial benefits to Town and will further important policies and goals of the Town; and
WHEREAS, Owner has incurred and will in the future incur substantial costs in order to assure development of the Property in accordance with this Agreement; and WHEREAS, Owner has incurred and will in the future incur substantial costs in excess of the generally applicable requirements in order to assure vesting of legal rights to develop the Property in accordance with this Agreement; and WHEREAS, the Town prepared a Draft Environmental Impact Report (“DEIR”; State Clearinghouse No. 2025100104) that analyzed the Project’s environmental impacts in accordance with the California Environmental Quality Act (Public Resources Code §§ 21000 et seq., “CEQA”), the regulations promulgated thereunder (14 Cal. Code of Regulations, §§ 15000 et seq., the “CEQA Guidelines”), and the Town’s Local CEQA Guidelines; and
WHEREAS, the DEIR was made available for public review and released to the public and commenting agencies for a 45-day comment period commencing January 13, 2026 and ending on February 27, 2026; and
WHEREAS, a Final EIR, Findings of Fact under CEQA, a Mitigation Monitoring and Reporting Program and a Statement of Overriding Considerations have been prepared; and
WHEREAS, Apple Valley Development Code Table 9.11.020-A “Review Authority,” grants the Planning Commission the responsibility and authority to review and make recommendations to the Town Council on the Development Agreement; and WHEREAS, on July 3, 2026, Development Agreement No. 2026-003 was duly noticed in the Apple Valley News, a newspaper of general circulation within the Town of Apple Valley. Pursuant to Section 9.13.030(9), a thirty-two (32) square foot sign was

Ordinance 578

posted on the site adjacent to the public right-of-way with a description of the project and the location, date, time and place of the scheduled hearing; and WHEREAS, on July 15, 2026, following the duly noticed public hearing, the Planning Commission made certain Findings of Fact and approved Resolution No. 2026- 002, recommending that the Town Council certify the Project EIR on the basis of its compliance with all CEQA requirements, approved Resolution No. 2026-003, recommending the Town Council adopt the requested General Plan Amendment, Zone Change and Development Code Amendment, approved Resolution No. 2026-004, in support of a recommendation to the Town Council to adopt a resolution approving Tentative Parcel Map No. 21034 and Development Permit No. 2025-013, and approved Resolution No. 2026-005 recommending the Town Council approve Development Agreement No. 2026-003 in connection with the Proposed Project; and WHEREAS, Development Agreement 2026-003 is consistent with the Land Use Element goals and polices of the Town’s General Plan and Title 9 “Development Code” of the Municipal Code of the Town of Apple Valley and shall promote the health, safety, and general welfare of the citizens of the Town of Apple Valley; and WHEREAS, all actions taken and approvals given by Town have been duly taken or approved in accordance with all applicable legal requirements for notice, public hearings, findings, votes, and other procedural matters; and WHEREAS, Development Agreement 2026-003 will eliminate uncertainty in planning and provide for the orderly development of the Property, ensure progressive installation of necessary improvements, provide for public services appropriate to the development of the Project, and generally serve the purposes for which development agreements under Sections 65864 et seq. of the Government Code are intended; and WHEREAS, the Town and Owner have reached mutual agreement and desire to voluntarily enter into the Development Agreement to facilitate development of the Project subject to the conditions and requirements set forth therein; and WHEREAS, at the public hearing, the Planning Commission considered the Staff Report, the Development Agreement, and public testimony; and WHEREAS, in adopting Planning Commission Resolution No. 2026-005 on July 15, 2026, the Planning Commission made the following findings pursuant to Development Code Section 9.04.020(C) with respect to Development Agreement 2026-003:

1. The proposed Development Agreement was consistent with the objectives, policies, land uses, and programs specified in the General Plan and any applicable specific plan,

2. The proposed Development Agreement was compatible with the uses authorized in, and the regulations prescribed for, the land use district in which the real property is located because development of the Property in accordance with

Ordinance 578

Development Agreement 2026-003 will provide substantial benefits to Town and will further important policies and goals of Town as described in the Development Agreement, the staff report and the resolution.

3. The proposed Development Agreement would be beneficial to the public health, safety and welfare because Development Agreement 2026-003 ensures the orderly and timely development of the Property, progressive installation of necessary improvements, and provides for public services appropriate to the development of the Project.

NOW, THEREFORE, THE TOWN COUNCIL OF THE TOWN OF APPLE
VALLEY DOES ORDAIN AS FOLLOWS:

SECTION 1. Incorporation of Recitals. The above recitals are true and correct and are incorporated herein by this reference.

SECTION 2. Based on the entire record before the Town Council and all oral and written evidence presented, the Town Council adopts the required Findings included in the Recitals above, and finds this Development Agreement not detrimental to the health, safety and welfare of the community because the Development Agreement will permit land uses that best reflect community needs, including the need for local employment opportunities and increased property tax revenue to fund Town services, and will allow for the most efficient and logical development of the real property governed by the Development Agreement in the Town.

SECTION 3. Pursuant to California Government Code section 65867.5(b), and based on the entire record before the Town Council, including all written and oral evidence presented, the Town Council hereby finds that the Development Agreement is consistent with the General Plan because the Development Agreement will result in development of the Property that is consistent with the uses and intensity allowed under the General Plan, and consistent with the proposed General Plan Amendment, Zone Change, and Development Code Amendment for the development of the Property.

SECTION 4. Based on the entire record before the Town Council and all written and oral evidence presented, the Town Council finds that: (i) the economic interests of Apple Valley citizens and the public health, safety and welfare will be best served by entering into the Development Agreement; (ii) this Development Agreement is compatible with the uses authorized in, and the regulations prescribed for, the area in which the Property is located, (iii) the Development Agreement is in conformity with the public convenience, general welfare and good land use practice; and (iv) the Development Agreement will not adversely affect the orderly development or the preservation of property values for the property it governs or any other property.

SECTION 5. Pursuant to California Government Code Section 65865, the Town Council hereby approves Development Agreement 2026-003, attached hereto as Exhibit “A.”

Ordinance 578

SECTION 6. Notice of Adoption. The Town Clerk of the Town of Apple Valley shall certify to the adoption of this Ordinance and cause publication to occur in a newspaper of general circulation and published and circulated in the Town in a manner permitted under Section 36933 of the Government Code of the State of California.

SECTION 7. Effective Date. This Ordinance shall take effect thirty (30) days after its adoption.

SECTION 8. Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this Ordinance, or any part thereof, is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining portion of this Ordinance or any part thereof. The Town Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, clause or phrase be declared unconstitutional. If for any reason any portion of this ordinance is found to be invalid by a court of competent jurisdiction, the balance of this ordinance shall not be affected.

SECTION 9. Notice of Exemption. The Town Council hereby directs staff to prepare, execute, and file with the San Bernardino County Clerk a notice of exemption under the California Environmental Quality Act within five (5) working days of the adoption of this Ordinance.

Ordinance 578

APPROVED and ADOPTED by the Town Council of the Town of Apple Valley and signed by the Mayor and attested by the Town Clerk this 8 th day of September 2026.
____________________________
Scott Nassif, Mayor
ATTEST:
________________________________
Kiel E. Mangerino, Acting Town Clerk

APPROVAL AS TO CONTENT
______________________________
Guy Eisnbrey, Town Manager

APPROVAL AS TO FORM
______________________________
Thomas Rice, Town Attorney

Recorded at the request of: )
Clerk, Town Council )
Town of Apple Valley )
)
When recorded return to: )
Town of Apple Valley )
14955 Dale Evans Parkway )
Attention: Town Clerk )
)
Exempt from Filing Fees, Government Code Section 6103
APNs: 0472-211-01, -02, -03, -09,
-10, -11, -17, -18, -19, -20, -21;
and 0472-301-01
DEVELOPMENT AGREEMENT NO. 2026-003
(APPLE VALLEY 84 PROJECT)

A DEVELOPMENT AGREEMENT BETWEEN

TOWN OF APPLE VALLEY
and
APPLE 84 LLC, A DELAWARE LIMITED LIABILITY COMPANY

DEVELOPMENT AGREEMENT NO. 2026-003
(APPLE VALLEY 84 PROJECT)
This Development Agreement (hereinafter “Agreement”) is entered into effective on the date it is recorded with the San Bernardino County Recorder (hereinafter the “Effective Date”) by and among the Town of Apple Valley, a California municipal corporation (hereinafter “TOWN”), and Apple 84 LLC, a Delaware limited liability company (hereinafter “OWNER”):

RECITALS
WHEREAS, TOWN is authorized to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property, pursuant to Section 65864 et seq. of the Government Code; and WHEREAS, OWNER has requested TOWN enter into a development agreement and proceedings have been taken in accordance with the rules and regulations of TOWN; and WHEREAS, by electing to enter into this Agreement, TOWN shall bind future Town Councils of TOWN by the obligations specified herein and limit the future exercise of certain governmental and proprietary powers of TOWN; and
WHEREAS, the terms and conditions of this Agreement have undergone extensive review by the Town Council and have been found to be fair, just and reasonable; and WHEREAS, the best interests of the citizens of the TOWN and the public health, safety and welfare will be served by entering into this Agreement; and WHEREAS, OWNER filed an application for the assemblage and development of twelve (12) parcels, totaling approximately 93 acres, into one (1) new parcel for the development of an approximately 1,381,412 square foot industrial/warehouse building and related improvements; and
WHEREAS, all of the procedures of the California Environmental Quality Act have been met with respect to the Project and the Agreement (State Clearinghouse No. 2025100104); and WHEREAS, on July 15, 2026, the Town’s Planning Commission recommended approval to the Town Council of General Plan Amendment No. 2024-001, Zone Change No. 2024-007, Development Code Amendment No. 2024-001, Development Permit – Major Project No. 2025- 013, Vesting Tentative Parcel Map No. 21034, and Development Agreement No. 2026-003 to allow for the development of one 1,381,412 square foot industrial building on the Property; and WHEREAS, on September 8, 2026, the Town Council approved General Plan Amendment No. 2024-001, Zone Change No. 2024-007, Development Code Amendment No. 2024-001, Development Permit – Major Project No. 2025-013, Vesting Tentative Parcel Map No. 21034, and Development Agreement No. 2026-003; and
WHEREAS, this Agreement and the Project are consistent with the TOWN’S Comprehensive General Plan and any Specific Plan applicable thereto; and WHEREAS, all actions taken and approvals given by TOWN have been duly taken or

approved in accordance with all applicable legal requirements for notice, public hearings, findings, votes, and other procedural matters; and
WHEREAS, development of the Property in accordance with this Agreement will provide substantial benefits to TOWN and will further important policies and goals of TOWN; and WHEREAS, this Agreement will eliminate uncertainty in planning and provide for the orderly development of the Property, ensure progressive installation of necessary improvements, provide for public services appropriate to the development of the Project, and generally serve the purposes for which development agreements under Sections 65864 et seq. of the Government Code are intended; and
WHEREAS, OWNER has incurred and will in the future incur substantial costs in order to assure development of the Property in accordance with this Agreement; and WHEREAS, OWNER has incurred and will in the future incur substantial costs in excess of the generally applicable requirements in order to assure vesting of legal rights to develop the Property in accordance with this Agreement.

COVENANTS
NOW, THEREFORE, in consideration of the above recitals and of the mutual covenants hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. DEFINITIONS AND EXHIBITS.

1.1 Definitions. The following terms when used in this Agreement shall be defined as follows:

1.1.1 “Agreement” means this Development Agreement.

1.1.2 “TOWN” means the Town of Apple Valley, a municipal corporation, organized and existing pursuant to the laws of the State of California.

1.1.3 “Development” means the improvement of the Property for the purposes of completing the structures, improvements and facilities comprising the Project including, but not limited to: grading; the construction of infrastructure and public facilities related to the Project whether located within or outside the Property; the construction of buildings and structures; and the installation of landscaping. “Development” does not include the maintenance, repair, reconstruction or redevelopment of any building, structure, improvement or facility after the construction and completion thereof.

1.1.4 “Development Agreement Policies” means those certain development agreement policies approved by TOWN pursuant to Ordinance No. 383, adopted on June 24, 2008; as Ordinance No. 405, adopted on April 27, 2010; as Ordinance No. 567, adopted on December 12, 2023, as amended as Title 9, Chapter 9.04, of the Town of Apple Valley Development Code.

1.1.5 “Development Approvals” means all permits and other entitlements for use subject to approval or issuance by TOWN in connection with development of the Property including, but not limited to:

(a) specific plans and specific plan amendments;
(b) tentative and final subdivision and parcel maps;
(c) development plan review;
(d) conditional use permits, public use permits and plot plans; (e) zoning;
(f) grading and building permits.

1.1.6 “Development Exaction” means any requirement of TOWN in connection with or pursuant to any Land Use Regulation or Development Approval for the dedication of land, the construction of improvements or public facilities, or the payment of fees in order to lessen, offset, mitigate or compensate for the impacts of development on the environment or other public interests.

1.1.7 “Development Impact Fee” means a monetary exaction other than a tax or special assessment, whether characterized as a fee or a tax and whether established for a broad class of projects by legislation of general applicability or imposed on a specific project on an ad hoc basis, that is charged by a local agency to the applicant in connection with approval of a development project for the purpose of defraying all or a portion of the cost of public facilities related to the development project, but does not include park “in lieu” fees specified in Government Code Section 66477, fees for processing applications for governmental regulatory actions or approvals, fees collected under development agreements adopted pursuant to Article

2.5 of the Government Code (commencing with Section 65864) of Chapter 4. “Development Impact Fee” shall not include processing fees and charges imposed by TOWN to cover the estimated actual costs to TOWN of processing applications for Development Approvals or for monitoring compliance with any Development Approvals granted or issued, including, without limitation, fees for zoning variances; zoning changes; use permits; building inspections; building permits; filing and processing applications and petitions filed with the local agency formation commission or conducting preliminary proceedings or proceedings under the Cortese-KnoxHertzberg Local Government Reorganization Act of 2000, Division 3 (commencing with Section 56000) of Title 5 of the Government Code; the processing of maps under the provisions of the Subdivision Map Act, Division 2 (commencing with Section 66410) of Title 7 of the Government Code; or planning services under the authority of Chapter 3 (commencing with Section 65100) of Division 1 of Title 7 of the Government Code, fees and charges as described in Sections 51287, 56383, 57004, 65104, 65456, 65863.7, 65909.5, 66013, 66014, and 66451.2 of the Government Code, Sections 17951, 19132.3, and 19852 of the Health and Safety Code, Section 41901 of the Public Resources Code, and Section 21671.5 of the Public Utilities Code, as such codes may be amended or superseded, including by amendment or replacement.

1.1.8 “Development Plan” means the proposed plan for Development of all or a portion of the Property pursuant to the Existing Development Approvals and Subsequent Development Approvals, in accord with the Existing Land Use Regulations and applicable Subsequent Land Use Regulations, subject to the Reservations of Authority.

1.1.9 “Effective Date” means the date that the ordinance approving this Agreement becomes effective.

1.1.10 “Existing Development Approvals” means all Development Approvals approved or issued prior to the Effective Date. Existing Development Approvals includes the Approvals incorporated herein and all other Approvals which are a matter of public record on the Effective Date.

1.1.11 “Existing Land Use Regulations” means all Land Use Regulations in effect on the Effective Date. Existing Land Use Regulations includes the Land Use Regulations incorporated herein as Exhibit “C” and all other Land Use Regulations which are in effect and a matter of public record on the Effective Date.

1.1.12 “General Plan” means the General Plan adopted on August 11, 2009 by Resolution No. 2009-31.

1.1.13 “Improvement” or “Improvements” means those public improvements required to support the development of the Project as described in the conditions of approval for Development Permit – Major Project No. 2025-013 and Vesting Tentative Parcel Map No. 21034 as further described in Exhibit “D” (the “Infrastructure Improvements Exhibit”).

1.1.14 “Land Use Regulations” means all ordinances, resolutions, codes, rules, regulations and official policies of TOWN governing the development and use of land, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of proposed buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the development of the Property. “Land Use Regulations” does not include any TOWN ordinance, resolution, code, rule, regulation or official policy, governing:
(a) the conduct of businesses, professions, and occupations; (b) taxes and assessments;
(c) the control and abatement of nuisances;
(d) the granting of encroachment permits and the conveyance of similar rights and interests which provide for the use of or the entry upon public property; (e) the exercise of the power of eminent domain.

1.1.15 “Mortgagee” means a mortgagee of a mortgage, a beneficiary under a deed of trust or any other security-device lender, and their successors and assigns.

1.1.16 “OWNER” means the persons and entities listed as OWNER on page one of this Agreement and their permitted successors in interest to all or any part of the Property.

1.1.17 “Project” means the development of the Property contemplated by the Development Plan as such Plan may be further defined, enhanced or modified pursuant to the provisions of this Agreement.

1.1.18 “Property” means the real property described on Exhibit “A” and shown on Exhibit “B” to this Agreement.

1.1.19 “Reservations of Authority” means the rights and authority excepted from the assurances and rights provided to OWNER under this Agreement and reserved to TOWN under Section 3.6 of this Agreement.

1.1.20 “Subsequent Development Approvals” means all Development Approvals required subsequent to the Effective Date in connection with development of the Property.

1.1.21 “Subsequent Land Use Regulations” means any Land Use Regulations adopted and effective after the Effective Date of this Agreement.

1.2 Exhibits. The following documents are attached to, and by this reference made a part of, this Agreement:

Exhibit “A” — Legal Description of the Property.

Exhibit “B” — Map showing Property and its location.

Exhibit “C” — Existing Land Use Regulations.

Exhibit “D” — Infrastructure Improvements.

2. GENERAL PROVISIONS.

2.1 Binding Effect of Agreement. The Property is hereby made subject to this Agreement. Development of the Property is hereby authorized and may be carried out only in accordance with the terms of this Agreement.

2.2 Ownership of Property. OWNER represents and covenants that it is the owner of the fee simple title to the Property or a portion thereof, or has the right to acquire fee simple title to the Property or a portion thereof from the current owner(s) thereof. To the extent OWNER does not own fee simple title to the Property, OWNER shall obtain written consent from the current fee owner of the Property agreeing to the terms of this Agreement and the recordation thereof.

2.3 Term. The term of this Agreement shall commence on the Effective Date, and shall continue for an initial period of ten (10) years thereafter unless this term is modified or extended pursuant to the provisions of this Agreement. The term of this Agreement may be extended for an additional five (5) years following expiration of the initial ten (10) year term, provided the following have occurred:
(a) OWNER provides at least one hundred eighty (180) days written notice to TOWN prior to expiration of the initial term;
(b) OWNER is not then in uncured default of this Agreement.

The initial term and, if and upon extension, the 5-year extension, shall sometimes be referred to herein collectively as the “Term.” Upon extension of the Term in accord with this Section 2.3, TOWN will execute, in recordable form, any instrument which OWNER may reasonably require to evidence the extension.

2.4 Assignment.

2.4.1 Right to Assign. OWNER shall have the right to sell, transfer or assign the Property in whole or in part (provided that no such partial transfer shall violate the Subdivision Map Act, Government Code Section 66410 et seq.), to any person, partnership, limited liability company, joint venture, firm or corporation at any time during the term of this Agreement; provided, however, that any such sale, transfer or assignment shall include the assignment and assumption of the rights, duties and obligations arising under or from this Agreement and be made in strict compliance with the following conditions precedent:
(a) No sale, transfer or assignment of any right or interest under this Agreement shall be made unless made together with the sale, transfer or assignment of all or a part of the Property.
(b) Concurrent with any such sale, transfer or assignment, or within fifteen (15) business days thereafter, OWNER shall notify TOWN’s Town Manager, in writing, of such sale, transfer or assignment and shall provide TOWN with (1) an executed agreement, in a form reasonably acceptable to TOWN, by the purchaser, transferee or assignee and providing therein that the purchaser, transferee or assignee expressly and unconditionally assumes all the duties and obligations of OWNER under this Agreement with respect to the portion of the Property so sold, transferred or assigned; and (2) the payment of the applicable processing charge to cover the TOWN’s review and consideration of such sale, transfer or assignment.

Any sale, transfer or assignment not made in strict compliance with the foregoing conditions shall constitute a default by OWNER under this Agreement. Notwithstanding the failure of any purchaser, transferee or assignee to execute the agreement required by Paragraph (b) of this Subsection 2.4.1, the burdens of this Agreement shall be binding upon such purchaser, transferee or assignee, but the benefits of this Agreement shall not inure to such purchaser, transferee or assignee until and unless such agreement is executed. The Town Manager shall have the authority to review, consider and either approve, conditionally approve, or deny any proposed sale, transfer or assignment that is not made in compliance with this section 2.4.

2.4.2 Release of Transferring Owner. Notwithstanding any sale, transfer or assignment, a transferring OWNER shall continue to be obligated under this Agreement unless such transferring OWNER is given a release in writing by TOWN, which release shall be provided by TOWN upon the full satisfaction by such transferring OWNER of the following conditions:
(a) OWNER no longer has a legal or equitable interest in all or any portion of the Property sold, transferred, or assigned.
(b) OWNER is not then in default under this Agreement.
(c) OWNER has provided TOWN with the notice and executed agreement required under Paragraph (b) of Subsection 2.4.1 above.
(d) The purchaser, transferee or assignee provides TOWN with security equivalent to any security previously provided by OWNER to secure performance of its obligations hereunder.

2.4.3 Effect of Assignment and Release of Obligations. In the event of a sale, transfer or assignment pursuant to the provisions of Section 2.4.2 above:
(a) The assignee shall be liable for the performance of all obligations of OWNER with respect to transferred property, but shall have no obligations with respect to the portions of the

Property, if any, not transferred (the “Retained Property”). (b) The owner of the Retained Property shall be liable for the performance of all obligations of OWNER with respect to Retained Property, but shall have no further obligations with respect to the transferred property.
(c) The assignee’s exercise, use and enjoyment of the Property or portion thereof shall be subject to the terms of this Agreement to the same extent as if the assignee were the OWNER.

2.4.4 Subsequent Assignment. Any subsequent sale, transfer or assignment after an initial sale, transfer or assignment shall be made only in accordance with and subject to the terms and conditions of this Section 2.4.

2.4.5 Termination of Agreement with Respect to Individual Lots Upon Sale to Public and Completion of Construction. The provisions of Subsection 2.4.1 shall not apply to the sale or lease (for a period longer than one year) of any lot which has been finally subdivided and is individually (and not in “bulk”) sold or leased to a member of the public or other ultimate user. Notwithstanding any other provisions of this Agreement, this Agreement shall terminate with respect to any lot and such lot shall be released and no longer be subject to this Agreement without the execution or recordation of any further document upon satisfaction of both of the following conditions:
(a) The lot has been finally subdivided and individually (and not in “bulk”) sold or leased (for a period longer than one year) to a member of the public or other ultimate user; and,
(b) A certificate of occupancy has been issued for a building on the lot, and the fees set forth under Section 4 of this Agreement have been paid.

2.4.6 Partial Assignment and Assumption. TOWN and OWNER agree OWNER may partially assign its obligations and rights under this Agreement, and all amendments hereto, to a purchaser, transferee or assignee of a lot, which has been subdivided subject to provisions of a partial assignment and assumption agreement in a form approved by TOWN. Any such complete and executed partial assignment and assumption of this Agreement shall be submitted to TOWN for approval, which shall not be unreasonably withheld, pursuant to Section 2.4.1 of this Agreement. Within thirty (30) days following such complete submittal, TOWN shall review, and if the above conditions are satisfied, may approve the partial assignment and release and notify the purchaser, transferee or assignee in writing thereof. No such release approved pursuant to this Subsection 2.4.6 shall cause, or otherwise affect, a release of OWNER from the duties and obligations under this Agreement that are retained by OWNER and excluded from the transfer or assignment.

2.5 Amendment or Cancellation of Agreement. This Agreement may be amended or cancelled in whole or in part by either party or successor in interest only in the manner provided for in Government Code Sections 65865.1 or 65868 and the Development Agreement Policies.

Any amendment of this Agreement, which amendment has been requested by OWNER, shall be considered by the TOWN only upon the payment of the applicable processing charge. This provision shall not limit any remedy of TOWN or OWNER as provided by this Agreement. For purposes of this section, the term “successor in interest” shall mean any person having a legal or equitable interest in the whole of the Property, or any portion thereof as to which such person wishes to amend or cancel this Agreement. The procedure for proposing and adopting an amendment to, or cancellation of, in whole or in part, this Agreement shall be the same as the

procedure for adopting and entering into this Agreement in the first instance. Notwithstanding the foregoing sentence, if the TOWN initiates the proposed amendment to, or cancellation of, in whole or in part, this Agreement, TOWN shall first give notice to the OWNER of its intention to initiate such proceedings at least sixty (60) days in advance of the giving the public notice of intention to consider the amendment or cancellation.

2.6 Minor Modification. Upon the written application of OWNER, minor modifications and changes to the Development Plan including modifications to building design or footprint (not affecting minimum setbacks), parking layout and design, and landscape area design may be approved by the Director of the Planning Department without the need to amend this Development Agreement. Other changes in the Development Plan shall be processed pursuant to the Town Zoning Ordinance. It is also contemplated by TOWN and OWNER that OWNER may, from time to time, seek amendments to one or more of the Development Approvals. Any such amendments are contemplated by TOWN and OWNER as being within the scope of this Agreement as long as they are consistent with the Land Use Regulations and shall, upon approval by TOWN, continue to constitute the Development Approvals as referenced herein. The parties agree that any such modifications or amendments shall not constitute an amendment to this Agreement nor require an amendment to this Agreement.

2.7 Termination. This Agreement shall be deemed terminated and of no further effect upon the occurrence of any of the following events:
(a) Expiration of the stated term of this Agreement as set forth in Section 2.3. (b) Entry of a final judgment setting aside, voiding or annulling the adoption of the ordinance approving this Agreement.
(c) The adoption of a referendum measure overriding or repealing the ordinance approving this Agreement.
(d) Completion of the Project in accordance with the terms of this Agreement including issuance of all required occupancy permits and acceptance by TOWN or applicable public agency of all required dedications.
(e) Termination of this Agreement based on any default of OWNER and following the termination proceedings required by the Development Agreement Policies.

Termination of this Agreement shall not constitute termination of any other land use entitlements approved for the Property. Upon the termination of this Agreement, no party shall have any further right or obligation hereunder except with respect to any obligation to have been performed prior to such termination or with respect to any default in the performance of the provisions of this Agreement which has occurred prior to such termination or with respect to any obligations which are specifically set forth as surviving this Agreement. Upon such termination, any public facilities and services mitigation fees paid pursuant to Section 4.2 of this Agreement by OWNER to TOWN on which construction has not yet begun shall be refunded to OWNER by TOWN.

2.8 Notices.
(a) As used in this Agreement, “notice” includes, but is not limited to, the communication of notice, request, demand, approval, statement, report, acceptance, consent,

waiver, appointment or other communication required or permitted hereunder. (b) All notices shall be in writing and shall be considered given either: (i) when delivered in person, including, without limitation, by courier, to the recipient named below; or (ii) on the date of delivery shown on the return receipt, after deposit in the United States mail in a sealed envelope as either registered or certified mail with return receipt requested, and postage and postal charges prepaid, and addressed to the recipient named below. All notices shall be addressed as follows:

If to TOWN:

Town of Apple Valley
14955 Dale Evans Parkway
Apple Valley, CA 92307
Attn: Guy Eisenbray, Town Manager
Telephone: (760) 240-7000
Facsimile: (760) 240-7546
Copy to:

Best, Best & Krieger, LLP
2855 E. Guasti Rd., Suite 400
Ontario, CA 91761
Attn: Thomas Rice, Town Attorney
Telephone: (909) 989-8584
Facsimile: (909) 944-1441
If to OWNER:

Apple 84 LLC
19782 MacArthur Blvd, Suite 230
Irvine, CA 92612
ATTN: Kenneth Sheer
Copy to:

Rutan & Tucker, LLP
18575 Jamboree Road, Suite 900
Irvine, CA 92612
Attn: John A. Ramirez
(c) Either party may, by notice given at any time, require subsequent notices to be given to another person or entity, whether a party or an officer or representative of a party, or to a different address, or both. Notices given before actual receipt of notice of change shall not be invalidated by the change.

2.9 Representations and Warranties.

TOWN represents and warrants to OWNER, as follows:
i. TOWN is a public body, corporate and politic. TOWN is authorized to enter into this Agreement pursuant to Government Code Section 65864, et seq., and the execution and delivery of this Agreement by TOWN has been fully authorized by all requisite actions on the part of TOWN.

ii. TOWN’s execution and delivery of this Agreement and TOWN’s performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which TOWN is a party or by which it is bound. iii. TOWN has not received any notice of, or knows any basis for, any actual or pending litigation or proceeding by any person against TOWN with respect to the Property or this Agreement.

3. DEVELOPMENT OF THE PROPERTY.

3.1 Rights to Develop. Subject to the terms of this Agreement including the Reservations of Authority, OWNER shall have a vested right to develop the Property in accordance with, and to the extent of, the Development Plan. Except as otherwise provided in this Agreement, the permitted uses of the Property, the density and intensity of use, the maximum height and size of proposed buildings, and provisions for reservation and dedication of land for public purposes shall be those set forth in the Existing Land Use Regulations.

3.2 Effect of Agreement on Land Use Regulations. Except as otherwise provided under the terms of this Agreement including the Reservations of Authority, the rules, regulations and official policies governing permitted uses of the Property, the density and intensity of use of the Property, the maximum height and size of proposed buildings, and the design, improvement and construction standards and specifications applicable to development of the Property shall be the Existing Land Use Regulations. In connection with any Subsequent Development Approval, TOWN shall exercise discretion in the same manner that it exercises discretion under its police powers including the Reservations of Authority set forth herein; provided, however, that such discretion shall not prevent development of the Property for the uses and to the density or intensity of development set forth in this Agreement.

3.3 Timing of Development. The parties acknowledge that OWNER cannot at this time predict when or the rate at which the Property will be developed. Such decisions depend upon numerous factors which are not within the control of OWNER, such as market orientation and demand, interest rates, absorption, completion and other similar factors. Since the California Supreme Court held in Pardee Construction Co. v. Town of Camarillo, (1984) 37 Cal.3d 465, that the failure of the parties therein to provide for the timing of development resulted in a later adopted initiative restricting the timing of development to prevail over such parties’ agreement, it is the parties’ intent to cure that deficiency by acknowledging and providing that OWNER shall have the right to develop the Property in such order and at such rate and at such times as OWNER deems appropriate within the exercise of its subjective business judgment, subject only to any timing or phasing requirements set forth in the Development Plan or the Phasing Plan set forth in Section

3.5. 3.3.1 Infrastructure Improvement Exhibit. Attached hereto as Exhibit “E” is a depiction of the Improvements needed for the development of the Property (the “Infrastructure Improvement Exhibit”).

3.4 Requirement for Public Infrastructure Improvements. Development of the Property is contingent in part on the phasing of area-wide infrastructure improvements over which the OWNER has control. The issuance of building permits by TOWN is, in general, contingent on OWNER’s completion of needed infrastructure improvements and the availability of improvements and services to serve the Property.

3.5 [Intentionally Omitted.]

3.6 Changes and Amendments. The parties acknowledge that refinement and further development of the Project will require Subsequent Development Approvals and may demonstrate that changes are appropriate and mutually desirable in the Existing Development Approvals. In the event OWNER finds that a change in the Existing Development Approvals is necessary or appropriate, OWNER shall apply for a Subsequent Development Approval to effectuate such change and TOWN shall process and act on such application in accordance with the Existing Land Use Regulations, except as otherwise provided by this Agreement including the Reservations of Authority. If approved, any such change in the Existing Development Approvals shall be incorporated herein as an addendum to Exhibit “C”, and may be further changed from time to time as provided in this Section. Unless otherwise requested by OWNER, TOWN may not amend or rescind any Subsequent Development Approvals applicable to the Property after those Approvals have been granted by the TOWN. Unless otherwise required by law, as determined in TOWN’s reasonable discretion, a change to the Existing Development Approvals or Development Plan and the processing of Subsequent Development Approvals shall be deemed “minor” and not require an amendment to this Agreement provided such change does not:
(a) Alter the permitted uses of the Property as a whole; or, (b) Increase the density or intensity of use of the Property as a whole; or, (c) Increase the maximum height and size of permitted buildings; or, (d) Delete a requirement for the reservation or dedication of land for public purposes within the Property as a whole; or,
(e) Constitute a project requiring a subsequent or supplemental environmental impact report pursuant to Section 21166 of the Public Resources Code.

3.7 Reservations of Authority.

3.7.1 Limitations, Reservations and Exceptions. Notwithstanding any other provision of this Agreement, the TOWN shall not be prevented from applying new rules, regulations and policies upon the OWNER, nor shall a development agreement prevent the TOWN from denying or conditionally approving any subsequent development project application on the basis of such new rules, regulations and policies where the new rules, regulations and policies consist of the following:
(a) Processing fees and charges of every kind and nature imposed by TOWN to cover the costs of processing applications for Development Approvals or for monitoring compliance with any Development Approvals.
(b) Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of procedure.
(c) Regulations, policies, and rules governing engineering and construction standards and specifications applicable to public and private improvements, including all uniform codes adopted by the TOWN and any local amendments to those codes adopted by the TOWN which are applied uniformly to all similar development projects within the

TOWN.
(d) Regulations imposing Development Exactions; provided, however, that no such subsequently adopted Development Exaction shall be applicable to development of the Property unless such Development Exaction is applied uniformly to development, either throughout the TOWN or within a defined area of benefit which includes the Property. No such subsequently adopted Development Exaction shall apply if its application to the Property would physically prevent development of the Property for the uses and to the density or intensity of development set forth in the Development Plan. In the event any such subsequently adopted Development Exaction fulfills the same purposes, in whole or in part, as the fees set forth in Section 4 of this Agreement, TOWN shall allow a credit against such subsequently adopted Development Exaction for the fees paid under Section 4 of this Agreement to the extent such fees fulfill the same purposes.
(e) Regulations which may conflict with this Agreement or the Development Plan but which are reasonably necessary to protect the public health and safety. To the extent possible, any such regulations shall be applied and construed so as to provide OWNER with the rights and assurances provided under this Agreement. (f) Regulations which do not conflict with those rules, regulations and policies set forth in this Agreement or the Development Plan. Any regulation, whether adopted by initiative or otherwise, limiting the rate or timing of development of the Property shall be deemed to conflict with the Development Plan and shall therefore not be applicable to the development of the Property.
(g) Regulations which may conflict with this Agreement or the Development Plan, but to which the OWNER consents in writing.

3.7.2 Subsequent Development Approvals. When acting on Subsequent Development Approvals, TOWN may apply only the Existing Land Use Regulations and those Subsequent Land Use Regulations that are permitted under the Reservations of Authority. Any Subsequent Development Approval will be automatically vested under this Agreement.

Upon OWNER’s request, TOWN will accept and diligently process applications for Subsequent Development Approvals. TOWN will exercise reasonable good faith efforts to expedite the processing of the Subsequent Development Approvals applications to ensure that those applications are promptly considered by the approving authority. TOWN will ensure that all applications are processed and considered within the timing requirements of all applicable law, including the Permit Streamlining Act (Govt. Code § 65920, et seq.).

3.7.3 Modification or Suspension by State or Federal Law. In the event that State or Federal laws or regulations, enacted after the Effective Date of this Agreement, prevent or preclude compliance with one or more of the provisions of this Agreement, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such State or Federal laws or regulations, provided, however, that this Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws or regulations and to the extent such laws or regulations do not render such remaining provisions impractical to enforce. In the event OWNER alleges that such State or Federal laws or regulations preclude or prevent compliance with one or more provisions of this Agreement, and the TOWN does not agree, the OWNER may, at its sole cost and expense, seek declaratory relief (or other similar non-monetary remedies); provided, however, that nothing contained in this Section 3.7.3 shall impose on TOWN any

monetary liability for contesting such declaratory relief (or other similar non-monetary relief).

3.7.4 Intent. The parties acknowledge and agree that TOWN is restricted in its authority to limit its police power by contract and that the foregoing limitations, reservations and exceptions are intended to reserve to TOWN all of its police power which cannot be so limited. This Agreement shall be construed, contrary to its stated terms if necessary, to reserve to TOWN all such power and authority which cannot be restricted by contract.

3.8 Public Works. If OWNER is required by this Agreement to construct any public works facilities which will be dedicated to TOWN or any other public agency upon completion, and if required by applicable laws to do so, OWNER shall perform such work in the same manner and subject to the same requirements as would be applicable to TOWN or such other public agency should it have undertaken such construction.

3.9 Acquisition of Offsite Real Property Interests. In any instance where OWNER is required by any Development Approval or Land Use Regulation to construct any public improvement on land not owned by OWNER (together, “Offsite Improvements”), OWNER shall at its sole cost and expense provide or cause to be provided, the real property interests necessary for the construction of such public improvements (the “Offsite Property”). In the event OWNER is unable, after exercising reasonable efforts, including, but not limited to, the rights under Sections 1001 and 1002 of the Civil Code, to acquire the Offsite Property necessary for the construction of the Offsite Improvements, and if so instructed by OWNER and upon OWNER’S provision of adequate security for costs TOWN may reasonably incur, TOWN agrees to use reasonable and diligent good faith efforts to acquire the Offsite Property from the owner or owners of record by negotiation to the extent permitted by law and consistent with this Agreement. If TOWN is unable to acquire the Offsite Property by negotiation within thirty (30) days after OWNER’s written request, TOWN shall, in accordance with the procedures established by law, use its power of eminent domain to acquire the Offsite Property at a public hearing noticed and conducted in accordance with California Code of Civil Procedure Section 1245.235 for the purpose of considering the adoption of a resolution of necessity concerning the Offsite Property, subject to the conditions set forth in this Section 3.9. The TOWN and OWNER acknowledge that the timelines set forth in this Section 3.9 represent the maximum time periods which TOWN and OWNER reasonably believe will be necessary to complete the acquisition of any Offsite Property.

TOWN agrees to use reasonable good faith efforts to complete the actions described within lesser time periods, to the extent that it is reasonably able to do so, consistent with the legal constraints imposed upon TOWN. OWNER shall pay all costs associated with such acquisition or condemnation proceedings. This section 3.9 is not intended by the parties to impose upon the OWNER an enforceable duty to acquire land or construct any public improvements on land not owned by OWNER, except to the extent that the OWNER elects to proceed with the development of the Project, and then only in accordance with valid conditions imposed by the TOWN upon the development of the Project under the Subdivision Map Act or other legal authority.

3.9.1 Owner’s Option to Terminate Proceedings. TOWN shall provide written notice to OWNER no later than fifteen (15) days prior to making an offer to the owner of the Offsite Property. At any time within that fifteen (15) day period, OWNER may, at its option, notify TOWN that it wants TOWN to cease all acquisition proceedings with respect to the Offsite Property, whereupon TOWN shall cease such proceedings. TOWN shall provide written notice to OWNER no later than fifteen (15) days prior to the date of the hearing on TOWN’S intent to consider the adoption of a resolution of necessity as to any Offsite Property. At any time within that fifteen (15) day period, OWNER may, at its option, notify TOWN that it wants TOWN to cease condemnation proceedings, whereupon TOWN shall cease such proceedings. If OWNER does not notify TOWN

to cease condemnation proceedings within said fifteen (15) day period, then the TOWN may proceed to consider and act upon the Offsite Property resolution of necessity. If TOWN adopts such resolution of necessity, then TOWN shall diligently institute condemnation proceedings and file a complaint in condemnation and seek an order of immediate possession with respect to the Offsite Property.

3.10 Regulation by Other Public Agencies. It is acknowledged by the parties that other public agencies not within the control of TOWN possess authority to regulate aspects of the development of the Property separately from or jointly with TOWN and this Agreement does not limit the authority of such other public agencies. TOWN agrees to cooperate, at no cost to TOWN, with OWNER in obtaining any required permits or compliance with the regulations of other public agencies provided such cooperation is not in conflict with any laws, regulations or policies of the TOWN.

3.11 Tentative Tract Maps; Extension. With respect to applications by OWNER for tentative subdivision maps for portions of the Property, TOWN agrees that OWNER may file and process tentative maps in accordance with Chapter 4.5 (commencing with Section 66498.1) of Division 2 of Title 7 of the California Government Code and the applicable provisions of TOWN’s subdivision ordinance, as the same may be amended from time to time. In accordance with the provisions of Section 66452.6 of the Government Code, each tentative subdivision map or tentative parcel map, heretofore or hereafter approved in connection with development of the Property, shall be deemed to have been granted an extension of time to and until the date that is five (5) years following the Effective Date of this Agreement. The TOWN’s Town Council may, in its discretion, extend any such map for an additional period of up to five (5) years beyond its original term, so long as subdivider files a written request for an extension with the TOWN prior to the expiration of the initial five (5) year term.

3.12 Utilities. The Project shall be connected to all utilities necessary to provide adequate water, sewer, gas, electric, and other utility service to the Project. OWNER shall contract with the TOWN for TOWN-owned or operated utilities serving the Project for such prices and on such terms as may be mutually agreed to between the parties.

4. PUBLIC BENEFITS.

4.1 Intent. The parties acknowledge and agree that development of the Property will result in substantial public needs which will not be fully met by the Development Plan and further acknowledge and agree that this Agreement confers substantial private benefits on OWNER which should be balanced by commensurate public benefits. Accordingly, the parties intend to provide consideration to the public to balance the private benefits conferred on OWNER by providing more fully for the satisfaction of the public needs resulting from the Project.

4.2 Development Impact Fees.

4.2.1 Amount and Components of Fee. Development Impact Fees (DIF) shall be paid by OWNER. The Development Impact Fee amounts to be paid by OWNER shall be the amounts that are in effect at the time such amounts are due. Nothing contained in this Agreement shall affect the ability of the TOWN to impose new Development Impact Fees or amend the amounts of existing Development Impact Fees. Additionally, nothing contained in this Agreement shall affect the ability of other public agencies that are not controlled by TOWN to impose and amend, from time to time, Development Impact Fees established or imposed by such other public

agencies, even though such Development Impact Fees may be collected by TOWN.

4.2.2 Time of Payment. The Development Impact Fees required pursuant to Subsection

4.2.1 shall be paid to TOWN prior to the issuance of the building permit for the industrial building.

No fees shall be payable for building permits issued prior to the Effective Date of this Agreement, but the fees required pursuant to Subsection 4.2.1 shall be paid prior to the re-issuance or extension of the building permit for the industrial building for which such fees have not previously been paid. Notwithstanding the foregoing, deferral of the payment of any Development Impact Fees may be granted pursuant to a separate agreement approved by TOWN pursuant to TOWN policy.

4.2.3 Credits. OWNER may be entitled to credit against the fees required pursuant to Subsection 4.2.1 for the dedication of land, the construction of improvements or the payment of fees. Under no circumstance shall any credit and/or reimbursement exceed the actual costs for any dedication of land, construction of improvements, or payment of fees.

4.3 Responsibility for Construction of Public Improvements.

4.3.1 Timely Construction of Public Infrastructure. The phasing of any areawide infrastructure construction will be as approved by the TOWN. OWNER shall be responsible for the timely construction and completion of all Improvements required for the Project as shown on the attached Exhibits “D.” Unless otherwise specified, all required Improvements, shall be completed and operational prior to, and as a condition precedent to, OWNER requesting and TOWN’s granting of the certificate of occupancy for the industrial building. All infrastructure and Improvements shall be completed as required by the applicable conditions of approval.

4.3.2 Construction of DIF Program Infrastructure. To the extent OWNER is required to construct and complete construction of public improvements that are included in TOWN’s Development Impact Fee Program, TOWN agrees that TOWN shall issue DIF Credit in accordance with the provisions of a separate Fee Credit Agreement between TOWN and OWNER. Limitation on the use of DIF Credit issued to OWNER to offset OWNER’s DIF payment obligations shall also be subject to the provisions of a separate Fee Credit Agreement. TOWN and OWNER agree that the Fee Credit Agreement between TOWN and OWNER shall comply with TOWN’s adopted policies applicable to such agreements. Under no circumstance shall any credit and/or reimbursement exceed the actual costs for construction of the improvements.

5. [INTENTIONALLY OMITTED.]

6. REVIEW FOR COMPLIANCE.

6.1 Periodic and Special Reviews.

6.1.1 Time for and Initiation of Periodic Review. The TOWN shall review this Agreement annually, on or before the anniversary of the Effective Date, in order to ascertain the good faith compliance by OWNER with the terms of this Agreement. OWNER shall submit an Annual Monitoring Report to TOWN, in a form acceptable to the Town Manager, along with any applicable processing charge, within thirty (30) days after each anniversary date of the Effective Date of this Agreement. Within thirty (30) days after the receipt of the Annual Monitoring Report, TOWN shall either issue a notice of continuing compliance or a notice of non-compliance and a notice of TOWN’s intent to conduct a Special Review pursuant to Sections 6.1.2 through 6.1.6. Issuance of a notice of continuing compliance may be issued by the Town Manager or his designee. The

amount of the annual review and administration fee shall be set annually by resolution of the Town Council.

6.1.2 Initiation of Special Review. A special review may be called either by agreement of the parties or by unilateral initiation by the TOWN in one or more of the following ways:
(a) Recommendation of the Planning Director;
(b) Affirmative vote of at least three (3) members of the Planning Commission; or (c) Affirmative vote of at least three (3) members of the Town Council.

6.1.3 Notice of Special Review. The Town Manager shall begin the special review proceeding by giving notice to OWNER that the TOWN intends to undertake a special review of this Agreement. Such notice shall be given at least ten (10) days in advance of the time at which the matter will be considered by the Planning Commission.

6.1.4 Public Hearing. The Planning Commission shall conduct a hearing at which OWNER must demonstrate good faith compliance with the terms of this Agreement. The burden of proof on this issue shall be on OWNER.

6.1.5 Findings upon Public Hearing. The Planning Commission shall determine, upon the basis of substantial evidence, whether OWNER has, for the period under review, complied in good faith with the terms and conditions of this Agreement.

6.1.6 Procedure upon Findings.
(a) If the Planning Commission finds and determines on the basis of substantial evidence that OWNER has complied in good faith with the terms and conditions of this Agreement, during the period under review, the review for that period shall be concluded. (b) If the Planning Commission finds and determines on the basis of substantial evidence that OWNER has not complied in good faith with the terms and conditions of this Agreement, during the period under review, the Planning Commission may recommend to the Town Council to modify or terminate this Agreement.
(c) OWNER may appeal a determination pursuant to paragraph (b) to the Town Council in accordance with TOWN’s rules for consideration of appeals in zoning matters generally.

6.2 Proceedings Upon Modification or Termination. If, upon a finding under Section

6.1.6(b), TOWN determines to proceed with modification or termination of this Agreement, TOWN shall give written notice to OWNER of its intention so to do. The notice shall be given at least thirty (30) calendar days prior to the scheduled hearing and shall contain:
(a) The time and place of the hearing;
(b) A statement as to whether or not TOWN proposes to terminate or to modify the Agreement; and,
(c) Such other information TOWN considers necessary to inform OWNER of the nature of the proceeding and the facts supporting Town’s preliminary findings under Section

6.1.6(b).

6.3 Hearing on Modification or Termination. At the time and place set for the hearing on modification or termination, OWNER shall be given an opportunity to be heard and present witnesses and evidence on its behalf. OWNER shall be required to demonstrate good faith compliance with the terms and conditions of this Agreement. The burden of proof on this issue shall be on OWNER. If the Town Council finds, based upon substantial evidence in the administrative record, that OWNER has not complied in good faith with the terms or conditions of the Agreement, the Town Council may terminate or modify this Agreement and impose such conditions to the action it takes as it considers necessary to protect the interests of the TOWN.

The decision of the Town Council shall be final, subject only to judicial review pursuant to Section 1094.5 of the Code of Civil Procedure.

6.4 Certificate of Agreement Compliance. If, at the conclusion of a Periodic or Special Review, OWNER is found to be in compliance with this Agreement, TOWN shall, upon written request by OWNER, issue a Certificate of Agreement Compliance (“Certificate”) to OWNER stating that after the most recent Periodic or Special Review and based upon the information known or made known to the Planning Director and Town Council that (1) this Agreement remains in effect and (2) OWNER is not in default. The Certificate shall be in recordable form, shall contain information necessary to communicate constructive record notice of the finding of compliance, shall state whether the Certificate is issued after a Periodic or Special Review and shall state the anticipated date of commencement of the next Periodic Review. OWNER may record the Certificate with the County Recorder.

Whether or not the Certificate is relied upon by assignees or other transferees or OWNER, TOWN shall not be bound by a Certificate if a default existed at the time of the Periodic or Special Review, but was concealed from or otherwise not known to the Planning Director or Town Council.

6.5 No Cross-Defaults. TOWN acknowledges that OWNER may transfer, sell or assign all or portions of the Property to other persons in accordance with Section 2.4. TOWN further acknowledges that title to all or portions of the Property may become vested in Mortgagees or a Mortgagee’s successor as a result of foreclosure, or the acceptance of a deed in lieu of foreclosure, by a Mortgagee. TOWN agrees that defaults under this Agreement by an owner of a portion of the Property will not be a default as to any other portion of the Property. In other words, a default by OWNER with respect to its obligations pertaining to that portion of the Property retained by OWNER following a transfer, sell, or assignment will not constitute a default as to any person other than OWNER or permit TOWN to exercise any remedy under this Agreement or otherwise with respect to any other portion of the Property other than that portion owned by OWNER. Similarly, a default by a transferee with respect to its obligations pertaining to the portion of the Property owned by that transferee will not constitute OWNER’s default or permit TOWN to exercise any remedy under this Agreement or otherwise as to any portion of the Property other than the portion owned by the defaulting transferee. TOWN agrees that, if more than one person holds title to the Property, then the rights and obligations of the persons holding title to the Property are the distinct and several obligations of each person.

7. DEFAULT AND REMEDIES.

7.1 Remedies in General. It is acknowledged by the parties that TOWN would not have entered into this Agreement if it were to be liable for monetary damages under this Agreement, or with respect to this Agreement or the application thereof.

In general, each of the parties hereto may pursue any remedy at law or equity available for the breach of any provision of this Agreement, except that neither party shall be liable in monetary damages (other than attorney’s fees under Section 10.22) to the other party, or to any successor in interest, or to any other person, and each party covenants not to sue for damages or claim any damages:
(a) For any breach of this Agreement or for any cause of action which arises out of this Agreement; or
(b) For the taking, impairment or restriction of any right or interest conveyed or provided under or pursuant to this Agreement; or
(c) Arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

7.2 Specific Performance. The parties acknowledge that money damages and remedies at law generally are inadequate and specific performance and other non-monetary relief are particularly appropriate remedies for the enforcement of this Agreement and should be available to all parties for the following reasons:
(a) Money damages are unavailable against the parties as provided in Section 7.1 above.
(b) Due to the size, nature and scope of the Project, it may not be practical or possible to restore the Property to its natural condition once implementation of this Agreement has begun.

After such implementation, OWNER may be foreclosed from other choices it may have had to utilize the Property or portions thereof. OWNER has invested significant time and resources and performed extensive planning and processing of the Project in agreeing to the terms of this Agreement and will be investing even more significant time and resources in implementing the Project in reliance upon the terms of this Agreement, and it is not possible to determine the sum of money which would adequately compensate OWNER for such efforts were TOWN to breach its obligations.

7.3 Release. Except for non-damage remedies, including the remedy of specific performance and judicial review as provided for in Sections 7.2 and 6.3, respectively, and the right to recover attorney’s fees under Section 10.22, OWNER, for itself, its successors and assignees, hereby releases the TOWN, its officers, agents and employees from any and all claims, demands, actions, or suits of any kind or nature arising out of any liability, known or unknown, present or future, including, but not limited to, any claim or liability, based or asserted, pursuant to Article I, Section 19 of the California Constitution, the Fifth Amendment of the United States Constitution, or any other law or ordinance which seeks to impose any other liability or damage, whatsoever, upon the TOWN because it entered into this Agreement or because of the terms of this Agreement.

7.4 Termination or Modification of Agreement for Default of OWNER. Subject to the provisions contained in Subsection 6.3 herein, TOWN may terminate or modify this Agreement for any failure of OWNER to perform any material duty or obligation of OWNER under this Agreement, or to comply in good faith with the terms of this Agreement (hereinafter referred to as “default”); provided, however, TOWN may terminate or modify this Agreement pursuant to this Section only after providing written notice to OWNER of default setting forth the nature of the default and the actions, if any, required by OWNER to cure such default and, where the default

can be cured, OWNER has failed to take such actions and cure such default within 60 days after the effective date of such notice or, in the event that such default cannot be cured within such 60 day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such 60 day period and to diligently proceed to complete such actions and cure such default.

7.5 Termination of Agreement for Default of TOWN. OWNER may terminate this Agreement only in the event of a default by TOWN in the performance of a material term of this Agreement and only after providing written notice to TOWN of default setting forth the nature of the default and the actions, if any, required by TOWN to cure such default and, where the default can be cured, TOWN has failed to take such actions and cure such default within 60 days after the effective date of such notice or, in the event that such default cannot be cured within such 60 day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such 60 day period and to diligently proceed to complete such actions and cure such default.

7.6 Informal Resolution. During the administration and implementation of this Agreement, the parties recognize that good faith disagreements may arise between TOWN staff and OWNER.

In the event that a dispute arises, the Parties will meet and confer in a good-faith attempt to resolve the dispute.

8. THIRD PARTY LITIGATION.

8.1 General Plan Litigation. TOWN has determined that this Agreement is consistent with its Comprehensive General Plan, as such called General Plan exists as of the Effective Date (“General Plan”), and that the General Plan meets all requirements of law. OWNER has reviewed the General Plan and concurs with TOWN’s determination.

TOWN shall have no liability in damages under this Agreement for any failure of TOWN to perform under this Agreement or the inability of OWNER to develop the Property as contemplated by the Development Plan of this Agreement as the result of a judicial determination that on the Effective Date, or at any time thereafter, the General Plan, or portions thereof, are invalid or inadequate or not in compliance with law.

8.2 Third Party Litigation Concerning Agreement. OWNER shall defend, at its expense, including attorneys’ fees, indemnify, and hold harmless TOWN, its agents, officers and employees from any claim, action or proceeding against TOWN, its agents, officers, or employees to attack, set aside, void, or annul the approval of this Agreement or the approval of any permit granted pursuant to this Agreement. TOWN shall promptly notify OWNER of any such claim, action or proceeding, and TOWN shall cooperate in the defense. If TOWN fails to promptly notify OWNER of any such claim, action or proceeding, or if TOWN fails to cooperate in the defense, OWNER shall not thereafter be responsible to defend, indemnify, or hold harmless TOWN. TOWN may in its discretion participate in the defense of any such claim, action or proceeding.

8.3 Indemnity. In addition to the provisions of 8.2 above, OWNER shall indemnify and hold TOWN, its officers, agents, employees and independent contractors free and harmless from any liability whatsoever, based or asserted upon any act or omission of OWNER, its officers, agents, employees, subcontractors and independent contractors, for property damage, bodily injury, or death (OWNER’s employees included) or any other element of damage of any kind or nature, relating to or in any way connected with or arising from the activities contemplated hereunder, including, but not limited to, the study, design, engineering, construction, completion,

failure and conveyance of the public improvements, save and except claims for damages arising through the sole negligence or sole willful misconduct of TOWN. OWNER shall defend, at its expense, including attorneys’ fees, TOWN, its officers, agents, employees and independent contractors in any legal action based upon such alleged acts or omissions. TOWN may in its discretion participate in the defense of any such legal action.

8.4 Environment Assurances. OWNER shall indemnify and hold TOWN, its officers, agents, and employees free and harmless from any liability, based or asserted, upon any act or omission of OWNER, its officers, agents, employees, subcontractors, predecessors in interest, successors, assigns and independent contractors for any violation of any federal, state or local law, ordinance or regulation relating to industrial hygiene or to environmental conditions on, under or about the Property, including, but not limited to, soil and groundwater conditions, and OWNER shall defend, at its expense, including attorneys’ fees, TOWN, its officers, agents and employees in any action based or asserted upon any such alleged act or omission. TOWN may in its discretion participate in the defense of any such action.

8.5 Reservation of Rights. With respect to Sections 8.2, 8.3 and 8.4 herein, TOWN reserves the right to either (1) approve the attorney(s) which OWNER selects, hires or otherwise engages to defend TOWN hereunder, which approval shall not be unreasonably withheld, or (2) conduct its own defense, provided, however, that OWNER shall reimburse TOWN forthwith for any and all reasonable expenses incurred for such defense, including attorneys’ fees, upon billing and accounting therefor.

8.6 Survival. The provisions of this Sections 8.1 through 8.6, inclusive, shall survive the termination of this Agreement.

9. MORTGAGEE PROTECTION.

The parties hereto agree that this Agreement shall not prevent or limit OWNER, in any manner, at OWNER’s sole discretion, from encumbering the Property or any portion thereof or any improvement thereon by any mortgage, deed of trust or other security device securing financing with respect to the Property. TOWN acknowledges that the lenders providing such financing may require certain Agreement interpretations and modifications and agrees upon request, from time to time, to meet with OWNER and representatives of such lenders to negotiate in good faith any such request for interpretation or modification. TOWN will not unreasonably withhold its consent to any such requested interpretation or modification provided such interpretation or modification is consistent with the intent and purposes of this Agreement. Any Mortgagee of the Property shall be entitled to the following rights and privileges:
(a) Neither entering into this Agreement nor a breach of this Agreement shall defeat, render invalid, diminish or impair the lien of any mortgage on the Property made in good faith and for value, unless otherwise required by law.
(b) The Mortgagee of any mortgage or deed of trust encumbering the Property, or any part thereof, which Mortgagee, has submitted a request in writing to the TOWN in the manner specified herein for giving notices, shall be entitled to receive written notification from TOWN of any default by OWNER in the performance of OWNER’s obligations under this Agreement. (c) If TOWN timely receives a request from a mortgagee requesting a copy of any notice of default given to OWNER under the terms of this Agreement, TOWN shall provide a copy of that notice to the Mortgagee within ten (10) days of sending the notice of default to OWNER. The

Mortgagee shall have the right, but not the obligation, to cure the default during the remaining cure period allowed such party under this Agreement.
(d) Any Mortgagee who comes into possession of the Property, or any part thereof, pursuant to foreclosure of the mortgage or deed of trust, or deed in lieu of such foreclosure, shall take the Property, or part thereof, subject to the terms of this Agreement. Notwithstanding any other provision of this Agreement to the contrary, no Mortgagee shall have an obligation or duty under this Agreement to perform any of OWNER’s obligations or other affirmative covenants of OWNER hereunder, or to guarantee such performance; provided, however, that to the extent that any covenant to be performed by OWNER is a condition precedent to the performance of a covenant by TOWN, the performance thereof shall continue to be a condition precedent to TOWN’s performance hereunder, and further provided that any sale, transfer or assignment by any Mortgagee in possession shall be subject to the provisions of Section 2.4 of this Agreement.

10. MISCELLANEOUS PROVISIONS.

10.1 Recordation of Agreement. This Agreement and any amendment or cancellation thereof shall be recorded with the San Bernardino County Recorder by the Town Clerk within ten (10) days of TOWN’s entry into this Agreement, as required by Section 65868.5 of the Government Code. If the parties to this Agreement or their successors in interest amend or cancel this Agreement as provided for herein and in Government Code Section 65868, or if the TOWN terminates or modifies the agreement as provided for herein and in Government Code Section 65865.1 for failure of the applicant to comply in good faith with the terms or conditions of this Agreement, the Town Clerk shall have notice of such action recorded with the San Bernardino County Recorder.

10.2 Entire Agreement. This Agreement sets forth and contains the entire understanding and agreement of the parties, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements which are not contained or expressly referred to herein. No testimony or evidence of any such representations, understandings or covenants shall be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement.

10.3 Severability. If any term, provision, covenant or condition of this Agreement shall be determined invalid, void or unenforceable, the remainder of this Agreement shall not be affected thereby to the extent such remaining provisions are not rendered impractical to perform taking into consideration the purposes of this Agreement. Notwithstanding the foregoing, the provision of the Public Benefits set forth in Section 4 of this Agreement, including the payment of the fees set forth therein, are essential elements of this Agreement and TOWN would not have entered into this Agreement but for such provisions, and therefore in the event such provisions are determined to be invalid, void or unenforceable, this entire Agreement shall be null and void and of no force and effect whatsoever.

10.4 Interpretation and Governing Law. This Agreement and any dispute arising hereunder shall be governed and interpreted in accordance with the laws of the State of California.

This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the parties hereto, and the rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in interpreting this Agreement, all parties having been represented by counsel in the negotiation and preparation hereof.

10.5 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement.

10.6 Singular and Plural. As used herein, the singular of any word includes the plural.

10.7 [Intentionally Omitted.]

10.8 Time is of the Essence. Time is of the essence in the performance of .the provisions of this Agreement as to which time is an element.

10.9 Waiver. Failure by a party to insist upon the strict performance of any of the provisions of this Agreement by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party’s right to insist and demand strict compliance by the other party with the terms of this Agreement thereafter.

10.10 No Third Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit of the parties and their successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

10.11 Force Majeure. Neither party shall be deemed to be in default where failure or delay in performance of any of its obligations under this Agreement is caused by floods, earthquakes, other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties beyond the party’s control, (including the party’s employment force), government regulations, court actions (such as restraining orders or injunctions), or other causes beyond the party’s control. If any such events shall occur, the term of this Agreement and the time for performance by either party of any of its obligations hereunder may be extended by the written agreement of the parties for the period of time that such events prevented such performance, provided that the term of this Agreement shall not be extended under any circumstances for more than five (5) years.

10.12 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the party benefited thereby of the covenants to be performed hereunder by such benefited party.

10.13 Successors in Interest. The burdens of this Agreement shall be binding upon, and the benefits of this Agreement shall inure to, all successors in interest to the parties to this Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes and constitute covenants running with the land. Each covenant to do or refrain from doing some act hereunder with regard to development of the Property: (a) is for the benefit of and is a burden upon every portion of the Property; (b) runs with the Property and each portion thereof; and, (c) is binding upon each party and each successor in interest during ownership of the Property or any portion thereof.

10.14 Counterparts. This Agreement may be executed by the parties in counterparts, which counterparts shall be construed together and have the same effect as if all of the parties had executed the same instrument.

10.15 Jurisdiction and Venue. Any action at law or in equity arising under this Agreement or brought by a party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Superior Court of the County of San Bernardino, State of California, and the parties hereto waive all provisions of law providing for the

filing, removal or change of venue to any other court.

10.16 Project as a Private Undertaking. It is specifically understood and agreed by and between the parties hereto that the development of the Project is a private development, that neither party is acting as the agent of the other in any respect hereunder, and that each party is an independent contracting entity with respect to the terms, covenants and conditions contained in this Agreement. No partnership, joint venture or other association of any kind is formed by this Agreement. The only relationship between TOWN and OWNER is that of a government entity regulating the development of private property and the owner of such property.

10.17 Further Actions and Instruments. Each of the parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement. Upon the request of either party at any time, the other party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by this Agreement. The Town Manager may delegate his or her powers and duties under this Agreement to an Assistant Town Manager or other management level employee of the TOWN.

10.18 Eminent Domain. No provision of this Agreement shall be construed to limit or restrict the exercise by TOWN of its power of eminent domain.

10.19 Agent for Service of Process. In the event OWNER is not a resident of the State of California or it is an association, partnership or joint venture without a member, partner or joint venturer resident of the State of California, or it is a foreign corporation, then in any such event, OWNER shall file with the Planning Director, upon its execution of this Agreement, a designation of a natural person residing in the State of California, giving his or her name, residence and business addresses, as its agent for the purpose of service of process in any court action arising out of or based upon this Agreement, and the delivery to such agent of a copy of any process in any such action shall constitute valid service upon OWNER. If for any reason service of such process upon such agent is not feasible, then in such event OWNER may be personally served with such process out of this County and such service shall constitute valid service upon OWNER.

OWNER is amenable to the process so served, submits to the jurisdiction of the Court so obtained and waives any and all objections and protests thereto. OWNER for itself, assigns and successors hereby waives the provisions of the Hague Convention (Convention on the Service Abroad of Judicial and Extra Judicial Documents in Civil or Commercial Matters, 20 U.S.T. 361, T.I.A.S. No. 6638).

10.20 Estoppel Certificate. Within thirty (30) days following a written request by any of the parties, the other party shall execute and deliver to the requesting party a statement certifying that (i) either this Agreement is unmodified and in full force and effect or there have been specified (date and nature) modifications to the Agreement, but it remains in full force and effect as modified; and (ii) either there are no known current uncured defaults under this Agreement or that the responding party alleges that specified (date and nature) defaults exist. The statement shall also provide any other reasonable information requested. The failure to timely deliver this statement shall constitute a conclusive presumption that this Agreement is in full force and effect without modification except as may be represented by the requesting party and that there are no uncured defaults in the performance of the requesting party, except as may be represented by the requesting party. OWNER shall pay to TOWN all costs incurred by TOWN in connection with

the issuance of estoppel certificates under this Section 10.20 prior to TOWN’s issuance of such certificates.

10.21 Authority to Execute. The person or persons executing this Agreement on behalf of a party warrants and represents that he or she/they have the authority to execute this Agreement on behalf of his or her/their corporation, partnership or business entity and warrants and represents that he or she/they has/have the authority to bind that party to the performance of its obligations hereunder.

10.22 Attorneys’ Fees. If either Party files any action or brings any action or proceeding against the other pertaining to the interpretation or enforcement of this Agreement, then the prevailing Party will recover as an element of its costs of suit and not as damages its costs of suit, expert fees, consultant costs, and reasonable attorneys’ fees as fixed by the Court.

IN WITNESS WHEREOF, the parties hereto have executed this Development Agreement on the day and year set forth below.
[SIGNATURES CONTAINED ON FOLLOWING PAGE]

SIGNATURE PAGE
TO DEVELOPMENT AGREEMENT NO. 2026-003
APPLE 84 LLC,
a Delaware limited liability company
By: _____________________________________
Name and Title: _____________________________________

Date: ___________________

TOWN OF APPLE VALLEY,
a California municipal corporation
By: ______________________________________
Scott Nassif, Mayor
Date: ___________________
ATTEST:

By: ______________________________________
Kiel E. Mangerino, Acting Town Clerk
APPROVED AS TO FORM:

By: ______________________________________
Thomas Rice, Town Attorney

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 and title of the officer)
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 capacities(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 _________________________________ (Seal)

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 and title of the officer)
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 capacities(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 _________________________________ (Seal)

Exhibit “A” — Legal Description of the Property
For APN/Parcel ID(s): 0469-162-24-0000, 0469-162-27-0000, 0472-211-01-0000, 0472-211- 02-0000,
0472-211-09-0000, 0472-211-10-0000, 0472-211-11-0000, 0472-211-19-0000, 0472-211-20- 0000 and 0472-301-01-0000

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF APPLE VALLEY,

COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:

PARCEL A:

PARCEL 1 OF PARCEL MAP NO. 2580, IN THE TOWN OF APPLE VALLEY, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 22, PAGE 95 OF PARCEL MAPS, RECORDS OF SAID COUNTY.

APN: 0469-162-24-0-000
PARCEL B:

PARCEL 4 OF PARCEL MAP NO. 2580, AS PER PLAT RECORDED IN BOOK 22, PAGE 95 OF PARCEL MAPS, RECORDS OF SAID COUNTY.

APN: 0469-162-27-0-000
PARCEL C:

THAT PORTION OF SOUTH ½ OF THE SOUTH ½ OF THE SOUTHEAST ¼ OF THE NORTHEAST ¼ OF SECTION 24, TOWNSHIP 6 SOUTH, RANGE 4 WEST, SAN

BERNARDINO BASE AND MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF

CALIFORNIA, LYING NORTHWESTERLY OF THE NORTHWESTERLY LINE OF STODDARD

WELLS ROAD, AS CONVEYED TO THE COUNTY OF SAN BERNARDINO BY DEED RECORDED IN BOOK 2316, PAGE 297 OF OFFICIAL RECORDS AND EASTERLY OF THE EASTERLY LINE OF THE FOLLOWING DESCRIBED PROPERTY: COMMENCING AT THE SOUTHEAST CORNER OF THE NORTHEAST ¼ OF SECTION 24, TOWNSHIP 6 NORTH, RANGE 4 WEST, SAN BERNARDINO BASE AND MERIDIAN, THENCE WEST 1046.77 FEET

TO THE CENTER LINE OF STODDARD WELLS ROAD AND THE TRUE POINT OF BEGINNING; THENCE NORTH 334.49 FEET; THENCE EAST 389.00 FEET; THENCE SOUTH 226.93 FEET TO THE CENTER LINE OF STODDARD WELLS ROAD; THENCE SOUTHWESTERLY ALONG THE CENTER LINE OF STODDARD WELLS ROAD, 404.01 FEET TO THE TRUE POINT OF BEGINNING.

APN: 0472-211-01-0-000
PARCEL D:

BEGINNING AT THE SOUTHEAST CORNER OF THE NORTHEAST ¼ OF SECTION 24, TOWNSHIP 6 NORTH, RANGE 4 WEST, SAN BERNARDINO BASE AND MERIDIAN, THENCE WEST 1046.77 FEET TO THE CENTER OF STODDARD WELLS ROAD AND THE TRUE POINT OF BEGINNING; THENCE NORTH 334.49 FEET; THENCE EAST 389.00 FEET; THENCE SOUTH 226.93 FEET TO THE CENTER LINE OF STODDARD WELLS ROAD;

THENCE SOUTHWESTERLY ALONG THE CENTER LINE OF STODDARD WELLS ROAD 404.01 FEET TO THE TRUE POINT OF BEGINNING. EXCEPTING ANY PORTION LYING

WITHIN STODDARD WELLS ROAD AS CONVEYED TO THE COUNTY OF SAN BERNARDINO BY DEED RECORDED IN BOOK 2316, PAGE 297 OF OFFICIAL RECORDS.

APN: 0472-211-02-0-000
PARCEL E:

PARCEL 1 OF PARCEL MAP 31, AS PER MAP RECORDED IN BOOK 1, PAGE 17 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 0472-211-09-0-000
PARCEL F:

PARCEL 2 OF PARCEL MAP 31, AS PER PLAT RECORDED IN BOOK 1, PAGE 17 OF PARCEL MAPS, RECORDS OF SAID COUNTY.

APN: 0472-211-10-0-000
PARCEL G:

THE NORTH ½ OF THE SOUTH ½ OF THE SOUTHEAST ¼ OF THE NORTHEAST ¼ OF SECTION 24, TOWNSHIP 6 NORTH, RANGE 4 WEST, SAN BERNARDINO BASE AND

MERIDIAN, IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA,

ACCORDING TO THE OFFICIAL PLAT OF SAID LAND ON FILE IN THE DISTRICT LAND OFFICE.

APN: 0472-211-11-0-000
PARCEL H:

THE EAST ½ OF THE NORTHEAST ¼ OF THE NORTHEAST ¼ OF SECTION 24, TOWNSHIP 6 NORTH, RANGE 4 WEST, SAN BERNARDINO MERIDIAN, IN THE COUNTY

OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO GOVERNMENT SURVEY.

APN: 0472-211-19-0-000
PARCEL I:

PARCEL 1 OF PARCEL MAP 1663, AS PER MAP RECORDED IN BOOK 15, PAGE 26 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 0472-211-20-0-000
PARCEL J:

THE WEST ½ OF THE NORTHWEST ¼ OF THE NORTHWEST ¼ OF SECTION 19, TOWNSHIP 6 NORTH, RANGE 3 WEST, SAN BERNARDINO BASE AND MERIDIAN,

ACCORDING TO UNITED STATES GOVERNMENT TOWNSHIP PLAT APPROVED BY THE SURVEYOR GENERAL DATED SEPTEMBER 9, 1919.

APN: 0472-301-01-0-000
PARCEL K:

AN EASEMENT FOR ROAD PURPOSES OVER AND ACROSS THE NORTHERLY 30 FEET AND OVER AND ACROSS THE SOUTHERLY 30 FEET OF THAT PORTION LYING WEST OF

STODDARD WELLS ROAD OF THE EAST ½ OF THE NORTHWEST ¼ OF THE NORTHWEST ¼ AND THE NORTHEAST ¼ OF THE NORTHWEST ¼ OF SECTION 19, TOWNSHIP 6 NORTH, RANGE 3 WEST, SAN BERNARDINO BASE AND MERIDIAN,

ACCORDING TO UNITED STATES GOVERNMENT TOWNSHIP PLAT APPROVED BY THE SURVEYOR GENERAL DATED SEPTEMBER 9, 1919.

Exhibit “B” — Map showing Property and its location

Exhibit “C” — Existing Land Use Regulations
The project complies with all applicable development standards and regulations per Table

9.35.040-A for the C-R zone, as shown in the below Development Standards compliance chart.

Requirement
category Sub-category (if any) Requirement (C-R zone) Proposal Lot Area 10,000 SF min. 92.73 acres
Building
Setbacks
Front 35’ from collector, 45’
from major roadway min.

Main bldg.: 250 feet
Guard shacks: 369’/66’
Side 30’ min. Main bldg.: 257 feet
Guard shacks: 478’/216’
Street Side 30’ min. Main bldg.: 303 feet
Rear 30’ min. Main bldg.:135 feet
Building Height 100’ max. 55 feet
Fence and Wall
heights
In clear-sight triangle 30” max. None proposed in clear sight triangles
In front/street side setback 42” max. None proposed in setback areas
All other locations 96” max. 96” fences proposed
Outdoor storage Allowed None proposed
Landscaping
total coverage 10% min. 844,246 SF (21%)
Front width 15 ft min. 40’-5”
Sides width 0 40’-5”
Rear width 0 75 feet
F.A.R. 1.0 max. 0.34
Lot coverage No maximum 33.8%

Exhibit “D” — Infrastructure Improvements
All public improvements included in Vesting Tentative Parcel Map No. 21034 and the Conditions of Approval included in Development Permit – Major Project No. 2025-013 are required to be completed, including but not limited to the following:

Streets
EC3. All streets abutting the development shall be improved a minimum half-width of 28 feet with curb, gutter, and sidewalk on the development side.

EC4. Stoddard Wells Road adjacent to the property shall be improved to the Town's half-width Major Divided Arterial Street standards.

EC5. Wrangler Road adjacent to the west boundary of the property shall be improved to the Town's half-width Secondary Street standards.

EC6. Johnson Road adjacent to the north boundary of the property shall be improved to the Town's half-width Industrial/Commercial Local Street standards.

EC19. A traffic signal shall be installed at the intersection of Wrangler Road and Stoddard Wells Road. All recommendations included in the Urban Crossroads Traffic Impact Analysis dated September 10, 2025, “1.5 Recommendations” shall be required.

EC21. All traffic mitigation measure required by Caltrans shall be constructed or required as approved by Caltrans.

EC22. All traffic mitigation measures recommended by the Urban Crossroads Traffic Impact Analysis, dated September 10, 2025, listed on “Table 6.1. Project Fair Share Calculations”, shall be required as approved by the Town Engineer, prior to final occupancy.

Water
LU1. Offsite water mains do not exist on Stoddard Wells Road and on Wrangler Road fronting this development. Water mains must be extended to provide fire protection for this development in accordance with Apple Valley Fire Protection District's conditions.

LU2. Water main extension contract between the developer and Liberty Apple Valley is required and must comply with Rule 15 of the California Public Utilities Commission. Subject to the terms of the contract, the cost of facilities installed as advances will be reimbursed to the developer at

2.5 percent per year for 40 years with no interest.

LU3. Extend 20" diameter pipeline about 2,800 feet along Wrangler Road and approximately 3.5 miles along Stoddard Wells Road to the east connecting to existing main on Johnson Road near Walmart Distribution Center.

LU4. Off-site fire hydrants are required to be located in accordance with Apple Valley Fire Protection District's requirements and installed per Liberty Apple Valley standard drawings.

LU6. Fire service lines are required for this development and shall be installed in accordance with Apple Valley Fire Protection District’s conditions and shall comply with Rule 16 of the California Public Utilities Commission. Approved and tested customer owned backflow protection devices

are required.

Sewer
PW2. Sewage disposal shall be by connection to the Town of Apple Valley sewer system.

Sewer
extension shall be required. Plans must be approved by the Town of Apple Valley Public Works
Department and Victor Valley Wastewater Reclamation Authority.

PW3. Six (6) inch sewer lateral required.

Town Council Agenda Report
Date: September 8, 2026
To: Honorable Mayor and Town Council
Subject: ADOPT ORDINANCE NO. 579, AN ORDINANCE OF THE TOWN

COUNCIL OF THE TOWN OF APPLE VALLEY, CALIFORNIA,
APPROVING DEVELOPMENT AGREEMENT 2026-002 BETWEEN

THE TOWN OF APPLE VALLEY AND COV APPLE VALLEY, LLC IN
CONNECTION WITH THE APPLE VALLEY 143 PROJECT
From: Guy Eisenbrey, Town Manager
Submitted by: Lindy Daugherty, Economic Development Specialist Planning Department
Budgeted Item: Yes No N/A

RECOMMENDED ACTION
Adopt Ordinance No. 579, an Ordinance of the Town Council of the Town of Apple Valley, approving Development Agreement No. 2026-002 between the Town of Apple Valley and COV Apple Valley, LLC related to the Apple Valley 143 industrial development proposed on approximately 143 acres of land (parcel numbers 0472-211-05, 0472-211-06, 0472- 211-15, 0472-222-06, and 0472-222-11) within the Town of Apple Valley, County of San Bernardino, State of California.

BACKGROUND
The Town Council reviewed and introduced Ordinance No. 579 at its August 25, 2026 regular meeting. Ordinance No. 579 has been scheduled for adoption at the September 8, 2026 regular meeting of the Town Council.

FISCAL IMPACT
No fiscal impact.

ATTACHMENTS
A. Ordinance No. 579 Approving DA 2026-002 with COV Apple Valley LLC B. Proposed Development Agreement 2026-002
C. Exhibit A – Legal Description
D. Exhibit B – Map of Property and Location
E. Exhibit C – AV 143 Approval Letter
F. Exhibit D – Land Use Regulations
G. Exhibit E – Infrastructure Improvements

ORDINANCE NO. 579

AN ORDINANCE OF THE TOWN COUNCIL OF THE TOWN

OF APPLE VALLEY, CALIFORNIA, APPROVING
DEVELOPMENT AGREEMENT NO. 2026-002 BETWEEN

THE TOWN OF APPLE VALLEY AND COV APPLE

VALLEY, LLC
WHEREAS, the Town of Apple Valley (“Town”) is a municipal corporation, duly organized under the constitution and laws of the State of California; and WHEREAS, Article 2.5 of Chapter 4 of Division 1 of Title 7 (commencing with Section 65864) of the Government Code of the State of California (“Statute”) authorizes the Town to enter into a contract which is called a development agreement in order to establish with certainty what regulations will govern the construction of a development; and
WHEREAS, Title 9 “Development Code” of the Municipal Code of the Town of Apple Valley (“AVMC”), specifically Chapter 9.04 “Development Agreements” establishes procedures and requirements for consideration of development agreements; and WHEREAS, in accordance with the Statute and Chapter 9.04 of the AVMC (herein referred to collectively as the “Development Agreement Law”), the Planning Commission of the Town of Apple Valley (the “Planning Commission”) did receive a request by Owner to enter into a development agreement to extend the life of Development Permit No. 2022- 016 and Tentative Parcel Map No. 20674; and
WHEREAS, Owner previously filed a successful application for the creation of three (3) parcels totaling approximately 143 acres to assemble and develop the Property with three (3) industrial/warehouse buildings: Building 1 (approximately 615,000 square feet); Building 2 (approximately 1,222,500 square feet); and Building 3 (approximately 682,500 square feet) for a total of approximately 2,520,000 square feet; and WHEREAS, all of the procedures of the California Environmental Quality Act have been met with respect to the Project and the Agreement (State Clearinghouse No. 2022070019); and
WHEREAS, on November 15, 2023, the Town’s Planning Commission approved Development Permit No. 2022-016, to construct a 2.52 million square foot industrial warehousing distribution development with a proposed maximum height of fifty-five (55) feet for all buildings, incorporated herein by this reference as if set forth in full; and WHEREAS, on November 15, 2023, the Town’s Planning Commission approved Tentative Parcel Map No. 20674 to establish three (3) parcels from approximately 143 acres within the Regional Commercial (C-R) – Warehouse Overlay zoning district, incorporated herein by this reference as if set forth in full; and

Ordinance No. 579
WHEREAS, Development Permit No. 2022-016 and Tentative Parcel Map No. 20674 are consistent with the General Plan and Municipal Code of the Town of Apple Valley; and
WHEREAS, Development Agreement No. 2026-002, attached hereto as Exhibit “A,” is proposed to provide for the development of the Proposed Project and certain vested development rights for the term of the Development Agreement, and in turn the Owner would provide specified public benefits; and
WHEREAS, development of the Property in accordance with this Agreement will provide substantial benefits to Town and will further important policies and goals of the Town; and
WHEREAS, Owner has incurred and will in the future incur substantial costs in order to assure development of the Property in accordance with this Agreement; and WHEREAS, Owner has incurred and will in the future incur substantial costs in excess of the generally applicable requirements in order to assure vesting of legal rights to develop the Property in accordance with this Agreement; and WHEREAS, this Agreement introduces no new significant environmental impacts, and all previously adopted mitigation measures are a condition of project approval; and WHEREAS, Apple Valley Development Code Table 9.11.020-A “Review Authority,” grants the Planning Commission the responsibility and authority to review and make recommendations to the Town Council on the Development Agreement; and WHEREAS, on July 3, 2026, Development Agreement No. 2026-002 was duly noticed in the Apple Valley News, a newspaper of general circulation within the Town of Apple Valley. Pursuant to Section 9.13.030(9), a thirty-two (32) square foot sign was posted on the site adjacent to the public right-of-way with a description of the project and the location, date, time and place of the scheduled hearing; and WHEREAS, on July 15, 2026, the Planning Commission of the Town of Apple Valley conducted a duly noticed and advertised public hearing for Development Agreement 2026-002, receiving testimony from the public and adopted Planning Commission Resolution No. 2026-006 recommending adoption of Development Agreement 2026-002; and
WHEREAS, Development Agreement 2026-002 is consistent with the Land Use Element goals and polices of the Town’s General Plan and Title 9 “Development Code” of the Municipal Code of the Town of Apple Valley and shall promote the health, safety, and general welfare of the citizens of the town of Apple Valley; and WHEREAS, all actions taken and approvals given by Town have been duly taken or approved in accordance with all applicable legal requirements for notice, public hearings, findings, votes, and other procedural matters; and

Ordinance No. 579
WHEREAS, this Agreement will eliminate uncertainty in planning and provide for the orderly development of the Property, ensure progressive installation of necessary improvements, provide for public services appropriate to the development of the Project, and generally serve the purposes for which development agreements under Sections 65864 et seq. of the Government Code are intended; and
WHEREAS, the Town and Owner have reached mutual agreement and desire to voluntarily enter into the Development Agreement to facilitate development of the Project subject to the conditions and requirements set forth therein; and WHEREAS, at the public hearing, the Planning Commission considered the Staff Report, the Development Agreement, and public testimony; and WHEREAS, in adopting Planning Commission Resolution No. 2026-006 on July 15, 2026, the Planning Commission made the following findings pursuant to Development Code Section 9.04.020(C) with respect to Development Agreement 2026-002:

1. The proposed Development Agreement was consistent with the objectives, policies, land uses, and programs specified in the General Plan and any applicable specific plan,

2. The proposed Development Agreement was compatible with the uses authorized in, and the regulations prescribed for, the land use district in which the real property is located because development of the Property in accordance with Development Agreement 2026-002 will provide substantial benefits to Town and will further important policies and goals of Town as described in the Development Agreement, the staff report and the resolution.

3. The proposed Development Agreement would be beneficial to the public health, safety and welfare because Development Agreement 2026-002 ensures the orderly and timely development of the Property, progressive installation of necessary improvements, and provides for public services appropriate to the development of the Project.

NOW, THEREFORE, THE TOWN COUNCIL OF THE TOWN OF APPLE
VALLEY DOES ORDAIN AS FOLLOWS:

SECTION 1. Incorporation of Recitals. The above recitals are true and correct and are incorporated herein by this reference.

SECTION 2. Based on the entire record before the Town Council and all oral and written evidence presented, the Town Council finds this Development Agreement not detrimental to the health, safety and welfare of the community because the Development Agreement will permit land uses that best reflect community needs, including the need for local employment opportunities and increased property tax revenue to fund Town services, and will allow for the most efficient and logical development of the real property governed by the Development Agreement in the Town.

Ordinance No. 579
SECTION 3. Pursuant to California Government Code section 65867.5(b), and based on the entire record before the Town Council, including all written and oral evidence presented, the Town Council hereby finds that the Development Agreement is consistent with the General Plan because the Development Agreement will result in the development of the Property that is consistent with the uses and intensity allowed under the General Plan.

SECTION 4. Based on the entire record before the Town Council and all written and oral evidence presented, the Town Council finds that: (i) the economic interests of Apple Valley citizens and the public health, safety and welfare will be best served by entering into the Development Agreement; (ii) this Development Agreement is compatible with the uses authorized in, and the regulations prescribed for, the area in which the Property is located, (iii) the Development Agreement is in conformity with the public convenience, general welfare and good land use practice; and (iv) the Development Agreement will not adversely affect the orderly development or the preservation of property values for the property it governs or any other property.

SECTION 5. Pursuant to California Government Code Section 65865, the Town Council hereby approves Development Agreement 2026-002, attached hereto as Exhibit “A.”
SECTION 6. CEQA. The Town Council has reviewed and considered the information in the previous Certified EIR and supporting documentation (State Clearinghouse No. 2022070019). Based upon the facts and information contained in the previous Certified EIR and supporting documentation, the Town Council finds as follows:
(1) The environmental impacts of this Project were previously reviewed in conjunction with the Apple Valley 143 Project Environmental Impact Report (State Clearinghouse No. 2022070019) which was certified by the Planning Commission on November 15, 2023. This Development Agreement is consistent with the previously Certified Environmental Impact Report (the “Certified EIR”) and introduces no new significant environmental impacts; and
(2) The previous Certified EIR contains a complete and accurate reporting of the environmental impacts associated with the Project; and (3) The previous Certified EIR was completed in compliance with CEQA and the Guidelines promulgated thereunder; and
(4) The previous Certified EIR reflects the independent judgement of the Planning Commission; and
(5) The proposed Development Agreement for the Project will introduce no new significant environmental impacts beyond those previously analyzed in the previous Certified EIR, and all mitigation measures previously adopted with the Certified EIR, are incorporated herein by this reference.

SECTION 7. Subsequent or Supplemental Environmental Review Not Required.

Ordinance No. 579
Based on the information presented to the Town Council, and the specific findings set forth in Section 6 above, the Town Council finds that the preparation of a subsequent or supplemental Certified EIR is not required for the Project, as the Project:
(1) Does not constitute substantial changes to the Certified EIR that will require major revisions to the Certified EIR due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; and
(2) Does not constitute substantial changes with respect to the circumstances under which the Certified EIR was prepared, that will require major revisions to the Certified EIR due to the involvement of new significant environmental effects or a substantial increase in the severity of previously identified significant effects; and (3) Does not contain new information of substantial importance that was not known and could not have been known with the exercise of reasonable diligence at the time the Certified EIR was certified/adopted, that shows any of the following:
(a) The project will have one or more significant effects not discussed in the Certified EIR; or
(b) Significant effects previously examined will be substantially more severe than shown in the Certified EIR; or
(c) Mitigation measures or alternatives previously found not to be feasible would in fact be feasible and would substantially reduce one or more significant effects of the Project, but the Town declined to adopt such measures; or (d) Mitigation measures or alternatives considerably different from those analyzed in the Certified EIR would substantially reduce one or more significant effects on the environment, but which the Town declined to adopt.

SECTION 8. Notice of Adoption. The Town Clerk of the Town of Apple Valley shall certify to the adoption of this Ordinance and cause publication to occur in a newspaper of general circulation and published and circulated in the Town in a manner permitted under Section 36933 of the Government Code of the State of California.

SECTION 9. Effective Date. This Ordinance shall take effect thirty (30) days after its adoption.

SECTION 10. Severability. If any section, subsection, subdivision, paragraph, sentence, clause or phrase of this Ordinance, or any part thereof, is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining portion of this Ordinance or any part thereof. The Town Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsection, subdivision, paragraph, sentence, clause or phrase be declared unconstitutional. If for

Ordinance No. 579
any reason any portion of this ordinance is found to be invalid by a court of competent jurisdiction, the balance of this ordinance shall not be affected.

SECTION 11. Notice of Determination. The Town Council hereby directs staff to prepare, execute, and file with the San Bernardino County Clerk a notice of determination within five (5) working days of the adoption of this Ordinance.

APPROVED and ADOPTED by the Town Council of the Town of Apple Valley and signed by the Mayor and attested by the Town Clerk this 8th day of September 2026. ____________________________
Scott Nassif, Mayor
Attest:
______________________________
Kiel E. Mangerino, Acting Town Clerk
Approved as to Form: Approved as to Content:
__________________________ _____________________________ Thomas A. Rice, Town Attorney Guy Eisenbrey, Town Manager

Recorded at request of: )
Clerk, Town Council )
Town of Apple Valley )
)
When recorded return to: )
Town of Apple Valley )
14955 Dale Evans Parkway )
Attention: Town Clerk )
)
Exempt from Filing Fees, Government Code Section 6103
APNs: 0472-211-05, 0472-211-06,
0472-211-15, 0472-222-06 & 0472-222-11
DEVELOPMENT AGREEMENT NO. 2026-002
(APPLE VALLEY 143 PROJECT)

A DEVELOPMENT AGREEMENT BETWEEN

TOWN OF APPLE VALLEY
and

COV APPLE VALLEY LLC, A DELAWARE LIMITED LIABILITY COMPANY

DEVELOPMENT AGREEMENT NO. 2026-002
(APPLE VALLEY 143)
This Development Agreement (hereinafter “Agreement”) is entered into effective on the date it is recorded with the San Bernardino County Recorder (hereinafter the “Effective Date”) by and among the Town of Apple Valley, a California municipal corporation (hereinafter “TOWN”), and COV Apple Valley LLC, a Delaware limited liability company (hereinafter “OWNER”):

RECITALS
WHEREAS, TOWN is authorized to enter into binding development agreements with persons having legal or equitable interests in real property for the development of such property, pursuant to Section 65864 et seq. of the Government Code; and WHEREAS, OWNER has requested TOWN enter into a development agreement and proceedings have been taken in accordance with the rules and regulations of TOWN; and WHEREAS, by electing to enter into this Agreement, TOWN shall bind future Town Councils of TOWN by the obligations specified herein and limit the future exercise of certain governmental and proprietary powers of TOWN; and
WHEREAS, the terms and conditions of this Agreement have undergone extensive review by TOWN the Town Council and have been found to be fair, just and reasonable; and WHEREAS, the best interests of the citizens of the TOWN and the public health, safety and welfare will be served by entering into this Agreement; and WHEREAS, OWNER filed an application for the creation of three (3) parcels totaling approximately 143 acres to assemble and develop the Property with three (3) industrial/warehouse buildings: Building 1 (approximately 615,000 square feet); Building 2 (approximately 1,222,500 square feet); and Building 3 (approximately 682,500 square feet) for a total of approximately 2,520,000 square feet; and
WHEREAS, all of the procedures of the California Environmental Quality Act have been met with respect to the Project and the Agreement (State Clearinghouse No. 2022070019); and WHEREAS, on November 15, 2023, the Town’s Planning Commission approved Development Permit No. 2022-016, to construct a 2.52 million square foot industrial warehousing distribution development with a proposed maximum height of fifty-five (55) feet for all buildings; and
WHEREAS, on November 15, 2023, the Town’s Planning Commission approved Tentative Parcel Map No. 20674 to establish three (3) parcels from approximately 143 acres within the Regional Commercial (C-R) – Warehouse Overlay zoning district; and

WHEREAS, this Agreement and the Project are consistent with the TOWN’S Comprehensive General Plan and any Specific Plan applicable thereto; and WHEREAS, all actions taken and approvals given by TOWN have been duly taken or approved in accordance with all applicable legal requirements for notice, public hearings, findings, votes, and other procedural matters; and
WHEREAS, development of the Property in accordance with this Agreement will provide substantial benefits to TOWN and will further important policies and goals of TOWN; and WHEREAS, this Agreement will eliminate uncertainty in planning and provide for the orderly development of the Property, ensure progressive installation of necessary improvements, provide for public services appropriate to the development of the Project, and generally serve the purposes for which development agreements under Sections 65864 etseq. of the Government Code are intended; and
WHEREAS, OWNER has incurred and will in the future incur substantial costs in order to assure development of the Property in accordance with this Agreement; and WHEREAS, OWNER has incurred and will in the future incur substantial costs in excess of the generally applicable requirements in order to assure vesting of legal rights to develop the Property in accordance with this Agreement.

COVENANTS
NOW, THEREFORE, in consideration of the above recitals and of the mutual covenants hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

1. DEFINITIONS AND EXHIBITS.

1.1 Definitions. The following terms when used in this Agreement shall be defined as follows:

1.1.1 “Agreement” means this Development Agreement.

1.1.2 “TOWN” means the Town of Apple Valley, a municipal corporation, organized and existing pursuant to the laws of the State of California.

1.1.3 “Development” means the improvement of the Property for the purposes of completing the structures, improvements and facilities comprising the Project including, but not limited to: grading; the construction of infrastructure and public facilities related to the Project whether located within or outside the Property; the construction of buildings and structures; and the installation of landscaping. “Development” does not include the maintenance, repair, reconstruction or redevelopment of any building, structure, improvement or facility after the construction and completion thereof.

1.1.4 “Development Agreement Policies” means those certain development agreement policies approved by TOWN pursuant to Ordinance No. 383, adopted on June 24, 2008; as Ordinance No. 405, adopted on April 27, 2010; as Ordinance No. 567, adopted on December 12, 2023, as amended as Title 9, Chapter 9.04, of the Town of Apple Valley Development Code.

1.1.5 “Development Approvals” means all permits and other entitlements for use subject to approval or issuance by TOWN in connection with development of the Property including, but not limited to:
(a) specific plans and specific plan amendments;
(b) tentative and final subdivision and parcel maps;
(c) development plan review;
(d) conditional use permits, public use permits and plot plans; (e) zoning;
(f) grading and building permits.

1.1.6 “Development Exaction” means any requirement of TOWN in connection with or pursuant to any Land Use Regulation or Development Approval for the dedication of land, the construction of improvements or public facilities, or the payment of fees in order to lessen, offset, mitigate or compensate for the impacts of development on the environment or other public interests.

1.1.7 “Development Impact Fee” means a monetary exaction other than a tax or special assessment, whether characterized as a fee or a tax and whether established for a broad class of projects by legislation of general applicability or imposed on a specific project on an ad hoc basis, that is charged by a local agency to the applicant in connection with approval of a development project for the purpose of defraying all or a portion of the cost of public facilities related to the development project, but does not include park “in lieu” fees specified in Government Code Section 66477, fees for processing applications for governmental regulatory actions or approvals, fees collected under development agreements adopted pursuant to Article 2.5 of the Government Code (commencing with Section 65864) of Chapter 4. “Development Impact Fee” shall not include processing fees and charges imposed by TOWN to cover the estimated actual costs to TOWN of processing applications for Development Approvals or for monitoring compliance with any Development Approvals granted or issued, including, without limitation, fees for zoning variances; zoning changes; use permits; building inspections; building permits; filing and processing applications and petitions filed with the local agency formation commission or conducting preliminary proceedings or proceedings under the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000, Division 3 (commencing with Section 56000) of Title 5 of the Government Code; the processing of maps under the provisions of the Subdivision Map Act, Division 2 (commencing with Section 66410) of Title 7 of the Government Code; or planning services under the authority of Chapter 3 (commencing with Section 65100) of Division 1 of Title 7 of the Government Code, fees and charges as described in Sections 51287, 56383, 57004, 65104, 65456, 65863.7, 65909.5, 66013, 66014, and 66451.2 of the Government Code, Sections 17951,

19132.3, and 19852 of the Health and Safety Code, Section 41901 of the Public Resources Code, and Section 21671.5 of the Public Utilities Code, as such codes may be amended or superseded, including by amendment or replacement.

1.1.8 “Development Plan” means the proposed plan for Development of all or a portion of the Property pursuant to the Existing Development Approvals and Subsequent Development Approvals, in accord with the Existing Land Use Regulations and applicable Subsequent Land Use Regulations, subject to the Reservations of Authority.

1.1.9 “Effective Date” means the date that the ordinance approving this Agreement becomes effective.

1.1.10 “Existing Development Approvals” means all Development Approvals approved or issued prior to the Effective Date. Existing Development Approvals includes the Approvals incorporated herein as Exhibit “C” and all other Approvals which are a matter of public record on the Effective Date.

1.1.11 “Existing Land Use Regulations” means all Land Use Regulations in effect on the Effective Date. Existing Land Use Regulations includes the Land Use Regulations incorporated herein as Exhibit “D” and all other Land Use Regulations which are in effect and a matter of public record on the Effective Date.

1.1.12 “General Plan” means the General Plan adopted on August 11, 2009 by Resolution No. 2009-31.

1.1.13 “Improvement” or “Improvements” means those public improvements required to support the development of the Project as described in the conditions of approval for Development Permit 2022-016 and Tentative Parcel Map No. 20574 as further described in Exhibit “E” (the “Infrastructure Improvements Exhibit”).

1.1.14 “Land Use Regulations” means all ordinances, resolutions, codes, rules, regulations and official policies of TOWN governing the development and use of land, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of proposed buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction standards and specifications applicable to the development of the Property. “Land Use Regulations” does not include any TOWN ordinance, resolution, code, rule, regulation or official policy, governing:
(a) the conduct of businesses, professions, and occupations; (b) taxes and assessments;
(c) the control and abatement of nuisances;
(d) the granting of encroachment permits and the conveyance of similar rights and interests which provide for the use of or the entry upon public property;

(e) the exercise of the power of eminent domain.

1.1.15 “Mortgagee” means a mortgagee of a mortgage, a beneficiary under a deed of trust or any other security-device lender, and their successors and assigns.

1.1.16 “OWNER” means the persons and entities listed as OWNER on page 1 of this Agreement and their permitted successors in interest to all or any part of the Property.

1.1.17 “Project” means the development of the Property contemplated by the Development Plan as such Plan may be further defined, enhanced or modified pursuant to the provisions of this Agreement.

1.1.18 “Property” means the real property described on Exhibit “A” and shown on Exhibit “B” to this Agreement.

1.1.19 “Reservations of Authority” means the rights and authority excepted from the assurances and rights provided to OWNER under this Agreement and reserved to TOWN under Section 3.6 of this Agreement.

1.1.20 “Subsequent Development Approvals” means all Development Approvals required subsequent to the Effective Date in connection with development of the Property.

1.1.21 “Subsequent Land Use Regulations” means any Land Use Regulations adopted and effective after the Effective Date of this Agreement.

1.2 Exhibits. The following documents are attached to, and by this reference made a part of, this Agreement:

Exhibit “A” — Legal Description of the Property.

Exhibit “B” — Map showing Property and its location.

Exhibit “C” — Existing Development Approvals.

Exhibit “D” — Existing Land Use Regulations.

Exhibit “E” — Infrastructure Improvements Exhibit.

2. GENERAL PROVISIONS.

2.1 Binding Effect of Agreement. The Property is hereby made subject to this Agreement. Development of the Property is hereby authorized and may be carried out only in accordance with the terms of this Agreement.

2.2 Ownership of Property. OWNER represents and covenants that it is the owner of the fee simple title to the Property or a portion thereof, or has the right to acquire fee simple title to the Property or a portion thereof from the current owner(s) thereof. To the extent OWNER does not own fee simple title to the Property, OWNER shall obtain written consent from the current fee owner of the Property agreeing to the terms of this Agreement and the recordation thereof.

2.3 Term. The term of this Agreement shall commence on the Effective Date, and shall continue for an initial period of ten (10) years thereafter unless this term is modified or extended pursuant to the provisions of this Agreement. The term of this Agreement may be extended for an additional five (5) years following expiration of the initial ten (10) year term, provided the following have occurred:
(a) OWNER provides at least one hundred eighty (180) days written notice to TOWN prior to expiration of the initial term;
(b) OWNER is not then in uncured default of this Agreement.

The initial term and, if and upon extension, the 5-year extension, shall sometimes be referred to herein collectively as the “Term.” Upon extension of the Term in accord with this Section 2.3, TOWN will execute, in recordable form, any instrument which OWNER may reasonably require to evidence the extension.

2.4 Assignment.

2.4.1 Right to Assign. OWNER shall have the right to sell, transfer or assign the Property in whole or in part (provided that no such partial transfer shall violate the Subdivision Map Act, Government Code Section 66410 et seq.), to any person, partnership, limited liability company, joint venture, firm or corporation at any time during the term of this Agreement; provided, however, that any such sale, transfer or assignment shall include the assignment and assumption of the rights, duties and obligations arising under or from this Agreement and be made in strict compliance with the following conditions precedent:
(a) No sale, transfer or assignment of any right or interest under this Agreement shall be made unless made together with the sale, transfer or assignment of all or a part of the Property.
(b) Concurrent with any such sale, transfer or assignment, or within fifteen (15) business days thereafter, OWNER shall notify TOWN’s Town Manager, in writing, of such sale, transfer or assignment and shall provide TOWN with (1) an executed agreement, in a form reasonably acceptable to TOWN, by the purchaser, transferee or assignee and providing therein that the purchaser, transferee or assignee expressly and unconditionally assumes all the duties and obligations of OWNER under this Agreement with respect to the portion of the Property so sold, transferred or assigned; and (2) the payment of the applicable processing charge to cover the TOWN’s review and consideration of such sale, transfer or assignment.

Any sale, transfer or assignment not made in strict compliance with the foregoing conditions shall constitute a default by OWNER under this Agreement. Notwithstanding the failure of any purchaser, transferee or assignee to execute the agreement required by Paragraph (b) of this Subsection 2.4.1, the burdens of this Agreement shall be binding upon such purchaser, transferee or assignee, but the benefits of this Agreement shall not inure to such purchaser, transferee or assignee until and unless such agreement is executed. The Town Manager shall have the authority to review, consider and either approve, conditionally approve, or deny any proposed sale, transfer or assignment that is not made in compliance with this section 2.4.

2.4.2 Release of Transferring Owner. Notwithstanding any sale, transfer or assignment, a transferring OWNER shall continue to be obligated under this Agreement unless such transferring OWNER is given a release in writing by TOWN, which release shall be provided by TOWN upon the full satisfaction by such transferring OWNER of the following conditions:
(a) OWNER no longer has a legal or equitable interest in all or any portion of the Property sold, transferred, or assigned.
(b) OWNER is not then in default under this Agreement.
(c) OWNER has provided TOWN with the notice and executed agreement required under Paragraph (b) of Subsection 2.4.1 above.
(d) The purchaser, transferee or assignee provides TOWN with security equivalent to any security previously provided by OWNER to secure performance of its obligations hereunder.

2.4.3 Effect of Assignment and Release of Obligations. In the event of a sale, transfer or assignment pursuant to the provisions of Section 2.4.2 above:
(a) The assignee shall be liable for the performance of all obligations of OWNER with respect to transferred property, but shall have no obligations with respect to the portions of the Property, if any, not transferred (the “Retained Property”). (b) The owner of the Retained Property shall be liable for the performance of all obligations of OWNER with respect to Retained Property, but shall have no further obligations with respect to the transferred property.
(c) The assignee’s exercise, use and enjoyment of the Property or portion thereof shall be subject to the terms of this Agreement to the same extent as if the assignee were the OWNER.

2.4.4 Subsequent Assignment. Any subsequent sale, transfer or assignment after an initial sale, transfer or assignment shall be made only in accordance with and subject to the terms and conditions of this Section 2.4.

2.4.5 Termination of Agreement with Respect to Individual Lots Upon Sale to Public and Completion of Construction. The provisions of Subsection 2.4.1 shall not apply to the sale or lease (for a period longer than one year) of any lot which has been finally subdivided and is individually (and not in “bulk”) sold or leased to a member of the public or other ultimate user. Notwithstanding any other provisions of this Agreement, this Agreement shall terminate with respect to any lot and such lot shall be released and no longer be subject to this Agreement without the execution or recordation of any further document upon satisfaction of both of the following conditions:
(a) The lot has been finally subdivided and individually (and not in “bulk”) sold or leased (for a period longer than one year) to a member of the public or other ultimate user; and, (b) A certificate of occupancy has been issued for a building on the lot, and the fees set forth under Section 4 of this Agreement have been paid.

2.4.6 Partial Assignment and Assumption. TOWN and OWNER agree OWNER may partially assign its obligations and rights under this Agreement, and all amendments hereto, to a purchaser, transferee or assignee of a lot, which has been subdivided subject to provisions of a partial assignment and assumption agreement in a form approved by TOWN. Any such complete and executed partial assignment and assumption of this Agreement shall be submitted to TOWN for approval, which shall not be unreasonably withheld, pursuant to Section 2.4.1 of this Agreement. Within thirty (30) days following such complete submittal, TOWN shall review, and if the above conditions are satisfied, may approve the partial assignment and release and notify the purchaser, transferee or assignee in writing thereof. No such release approved pursuant to this Subsection 2.4.6 shall cause, or otherwise affect, a release of OWNER from the duties and obligations under this Agreement that are retained by OWNER and excluded from the transfer or assignment.

2.5 Amendment or Cancellation of Agreement. This Agreement may be amended or cancelled in whole or in part by either party or successor in interest only in the manner provided for in Government Code Sections 65865.1 or 65868 and the Development Agreement Policies.

Any amendment of this Agreement, which amendment has been requested by OWNER, shall be considered by the TOWN only upon the payment of the applicable processing charge. This provision shall not limit any remedy of TOWN or OWNER as provided by this Agreement. For purposes of this section, the term “successor in interest” shall mean any person having a legal or equitable interest in the whole of the Property, or any portion thereof as to which such person wishes to amend or cancel this Agreement. The procedure for proposing and adopting an amendment to, or cancellation of, in whole or in part, this Agreement shall be the same as the procedure for adopting and entering into this Agreement in the first instance. Notwithstanding the foregoing sentence, if the TOWN initiates the proposed amendment to, or cancellation of, in whole or in part, this Agreement, TOWN shall first give notice to the OWNER of its intention to initiate such proceedings at least sixty (60) days in advance of the giving the public notice of intention to consider the amendment or cancellation.

2.6 Minor Modification. Upon the written application of OWNER, minor modifications and changes to the Development Plan including modifications to building design or footprint (not affecting minimum setbacks), parking layout and design, and landscape area design may be approved by the Director of the Planning Department without the need to amend this Development Agreement. Other changes in the Development Plan shall be processed pursuant to the Town Zoning Ordinance. It is also contemplated by TOWN and OWNER that OWNER may, from time to time, seek amendments to one or more of the Development Approvals. Any such amendments are contemplated by TOWN and OWNER as being within the scope of this Agreement as long as they are consistent with the Land Use Regulations and shall, upon approval by TOWN, continue to constitute the Development Approvals as referenced herein. The parties agree that any such modifications or amendments shall not constitute an amendment to this Agreement nor require an amendment to this Agreement.

2.7 Termination. This Agreement shall be deemed terminated and of no further effect upon the occurrence of any of the following events:
(a) Expiration of the stated term of this Agreement as set forth in Section 2.3.

(b) Entry of a final judgment setting aside, voiding or annulling the adoption of the ordinance approving this Agreement.
(c) The adoption of a referendum measure overriding or repealing the ordinance approving this Agreement.
(d) Completion of the Project in accordance with the terms of this Agreement including issuance of all required occupancy permits and acceptance by TOWN or applicable public agency of all required dedications.
(e) Termination of this Agreement based on any default of OWNER and following the termination proceedings required by the Development Agreement Policies.

Termination of this Agreement shall not constitute termination of any other land use entitlements approved for the Property. Upon the termination of this Agreement, no party shall have any further right or obligation hereunder except with respect to any obligation to have been performed prior to such termination or with respect to any default in the performance of the provisions of this Agreement which has occurred prior to such termination or with respect to any obligations which are specifically set forth as surviving this Agreement. Upon such termination, any public facilities and services mitigation fees paid pursuant to Section 4.2 of this Agreement by OWNER to TOWN on which construction has not yet begun shall be refunded to OWNER by TOWN.

2.8 Notices.
(a) As used in this Agreement, “notice” includes, but is not limited to, the communication of notice, request, demand, approval, statement, report, acceptance, consent, waiver, appointment or other communication required or permitted hereunder. (b) All notices shall be in writing and shall be considered given either: (i) when delivered in person, including, without limitation, by courier, to the recipient named below; or (ii) on the date of delivery shown on the return receipt, after deposit in the United States mail in a sealed envelope as either registered or certified mail with return receipt requested, and postage and postal charges prepaid, and addressed to the recipient named below. All notices shall be addressed as follows:

If to TOWN:

Town of Apple Valley
14955 Dale Evans Parkway
Apple Valley, CA 92307
Attn: Guy Eisenbrey, Town Manager
Telephone: 760-240-7000 ext 7051
Copy to:

Best, Best & Krieger, LLP
2855 E. Guasti Rd., Suite 400
Ontario, CA 91761
Attn: Thomas Rice, Town Attorney

Telephone: (909) 989-8584
Facsimile: (909) 944-1441
If to OWNER:

COV Apple Valley, LLC
19782 MacArthur Blvd., Suite 230
Irvine, CA 92612
Attn: Ronald Rakunas
with a copy to:

Rutan & Tucker, LLP
18575 Jamboree Road, Suite 900
Irvine, CA 92612
Attn: John A. Ramirez
(c) Either party may, by notice given at any time, require subsequent notices to be given to another person or entity, whether a party or an officer or representative of a party, or to a different address, or both. Notices given before actual receipt of notice of change shall not be invalidated by the change.

2.9 Representations and Warranties.

TOWN represents and warrants to Developer, as follows:
i. TOWN is a public body, corporate and politic. TOWN is authorized to enter into this Agreement pursuant to Government Code Section 65864, et seq., and the execution and delivery of this Agreement by TOWN has been fully authorized by all requisite actions on the part of TOWN.
ii. TOWN’s execution and delivery of this Agreement and TOWN’s performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which TOWN is a party or by which it is bound. iii. TOWN has not received any notice of, or knows any basis for, any actual or pending litigation or proceeding by any Person against TOWN with respect to the Property or this Agreement.

3. DEVELOPMENT OF THE PROPERTY.

3.1 Rights to Develop. Subject to the terms of this Agreement including the Reservations of Authority, OWNER shall have a vested right to develop the Property in accordance with, and to the extent of, the Development Plan. Except as otherwise provided in this Agreement, the permitted uses of the Property, the density and intensity of use, the maximum height and size

of proposed buildings, and provisions for reservation and dedication of land for public purposes shall be those set forth in the Existing Land Use Regulations.

3.2 Effect of Agreement on Land Use Regulations. Except as otherwise provided under the terms of this Agreement including the Reservations of Authority, the rules, regulations and official policies governing permitted uses of the Property, the density and intensity of use of the Property, the maximum height and size of proposed buildings, and the design, improvement and construction standards and specifications applicable to development of the Property shall be the Existing Land Use Regulations. In connection with any Subsequent Development Approval, TOWN shall exercise discretion in the same manner that it exercises discretion under its police powers including the Reservations of Authority set forth herein; provided, however, that such discretion shall not prevent development of the Property for the uses and to the density or intensity of development set forth in this Agreement.

3.3 Timing of Development. The parties acknowledge that OWNER cannot at this time predict when or the rate at which phases of the Property will be developed. Such decisions depend upon numerous factors which are not within the control of OWNER, such as market orientation and demand, interest rates, absorption, completion and other similar factors. Since the California Supreme Court held in Pardee Construction Co. v. Town of Camarillo, (1984) 37 Cal.3d 465, that the failure of the parties therein to provide for the timing of development resulted in a later adopted initiative restricting the timing of development to prevail over such parties’ agreement, it is the parties’ intent to cure that deficiency by acknowledging and providing that OWNER shall have the right to develop the Property in such order and at such rate and at such times as OWNER deems appropriate within the exercise of its subjective business judgment, subject only to any timing or phasing requirements set forth in the Development Plan or the Phasing Plan set forth in Section

3.5. 3.3.1 Infrastructure Improvement Exhibit. Attached hereto as Exhibit “E” is a depiction of the Improvements needed for the development of the Property (the “Infrastructure Improvement Exhibit”).

3.4 Requirement for Public Infrastructure Improvements. Development of the Property is contingent in part on the phasing of area-wide infrastructure improvements over which the OWNER has control. The issuance of building permits by TOWN is, in general, contingent on OWNER’s completion of needed infrastructure improvements and the availability of improvements and services to serve the Property.

3.5 Phasing Plan. Construction of Building 2 and all off-site development work will begin within three (3) years of the Effective Date of this Agreement. Construction of Building 1 and Building 3 will begin within the subsequent three (3) years.

This Phasing Plan is preliminary and reflects OWNER’s good-faith estimate of the sequencing and timing of the Project based on conditions known on the Effective Date. Except as expressly provided in this Agreement, phase dates are estimates only and are not binding deadlines, and any change in phasing shall not, by itself, constitute a default.

OWNER may revise the Phasing Plan from time to time. OWNER may make non-material sequencing changes upon written notice to TOWN. Any material revision affecting (a) public or off-site improvements, (b) dedications or easements to TOWN, (c) reimbursements, credits, or other financial obligations of either party, or (d) the timing of any express obligation under this Agreement, requires TOWN’s prior written approval, which shall not be unreasonably withheld, conditioned, or delayed. Any approved revised Phasing Plan shall replace the prior Phasing Plan as of the date of approval.

3.6 Changes and Amendments. The parties acknowledge that refinement and further development of the Project will require Subsequent Development Approvals and may demonstrate that changes are appropriate and mutually desirable in the Existing Development Approvals. In the event OWNER finds that a change in the Existing Development Approvals is necessary or appropriate, OWNER shall apply for a Subsequent Development Approval to effectuate such change and TOWN shall process and act on such application in accordance with the Existing Land Use Regulations, except as otherwise provided by this Agreement including the Reservations of Authority. If approved, any such change in the Existing Development Approvals shall be incorporated herein as an addendum to Exhibit “C”, and may be further changed from time to time as provided in this Section. Unless otherwise requested by OWNER, TOWN may not amend or rescind any Subsequent Development Approvals applicable to the Property after those Approvals have been granted by the TOWN. Unless otherwise required by law, as determined in TOWN’s reasonable discretion, a change to the Existing Development Approvals or Development Plan and the processing of Subsequent Development Approvals shall be deemed “minor” and not require an amendment to this Agreement provided such change does not:
(a) Alter the permitted uses of the Property as a whole; or, (b) Increase the density or intensity of use of the Property as a whole; or, (c) Increase the maximum height and size of permitted buildings; or, (d) Delete a requirement for the reservation or dedication of land for public purposes within the Property as a whole; or,
(e) Constitute a project requiring a subsequent or supplemental environmental impact report pursuant to Section 21166 of the Public Resources Code.

3.7 Reservations of Authority.

3.7.1 Limitations, Reservations and Exceptions. Notwithstanding any other provision of this Agreement, the TOWN shall not be prevented from applying new rules, regulations and policies upon the OWNER, nor shall a development agreement prevent the TOWN from denying or conditionally approving any subsequent development project application on the basis of such new rules, regulations and policies where the new rules, regulations and policies consist of the following:
(a) Processing fees and charges of every kind and nature imposed by TOWN to cover the costs of processing applications for Development Approvals or for monitoring compliance with any Development Approvals.

(b) Procedural regulations relating to hearing bodies, petitions, applications, notices, findings, records, hearings, reports, recommendations, appeals and any other matter of procedure.
(c) Regulations, policies, and rules governing engineering and construction standards and specifications applicable to public and private improvements, including all uniform codes adopted by the TOWN and any local amendments to those codes adopted by the TOWN which are applied uniformly to all similar development projects within the TOWN. (d) Regulations imposing Development Exactions; provided, however, that no such subsequently adopted Development Exaction shall be applicable to development of the Property unless such Development Exaction is applied uniformly to development, either throughout the TOWN or within a defined area of benefit which includes the Property. No such subsequently adopted Development Exaction shall apply if its application to the Property would physically prevent development of the Property for the uses and to the density or intensity of development set forth in the Development Plan. In the event any such subsequently adopted Development Exaction fulfills the same purposes, in whole or in part, as the fees set forth in Section 4 of this Agreement, TOWN shall allow a credit against such subsequently adopted Development Exaction for the fees paid under Section 4 of this Agreement to the extent such fees fulfill the same purposes.
(e) Regulations which may conflict with this Agreement or the Development Plan but which are reasonably necessary to protect the public health and safety. To the extent possible, any such regulations shall be applied and construed so as to provide OWNER with the rights and assurances provided under this Agreement. (f) Regulations which do not conflict with those rules, regulations and policies set forth in this Agreement or the Development Plan. Any regulation, whether adopted by initiative or otherwise, limiting the rate or timing of development of the Property shall be deemed to conflict with the Development Plan and shall therefore not be applicable to the development of the Property.
(g) Regulations which may conflict with this Agreement or the Development Plan, but to which the OWNER consents in writing.

3.7.2 Subsequent Development Approvals. When acting on Subsequent Development Approvals, TOWN may apply only the Existing Land Use Regulations and those Subsequent Land Use Regulations that are permitted under the Reservations of Authority. Any Subsequent Development Approval will be automatically vested under this Agreement.

Upon OWNER’s request, TOWN will accept and diligently process applications for Subsequent Development Approvals. TOWN will exercise reasonable good faith efforts to expedite the processing of the Subsequent Development Approvals applications to ensure that those applications are promptly considered by the approving authority. TOWN will ensure that all applications are processed and considered within the timing requirements of all applicable law, including the Permit Streamlining Act (Govt. Code § 65920, et seq.).

3.7.3 Modification or Suspension by State or Federal Law. In the event that State or Federal laws or regulations, enacted after the Effective Date of this Agreement, prevent or preclude compliance with one or more of the provisions of this Agreement, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such State or Federal laws or regulations, provided, however, that this Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws or regulations and to the extent such laws or regulations do not render such remaining provisions impractical to enforce. In the event OWNER alleges that such State or Federal laws or regulations preclude or prevent compliance with one or more provisions of this Agreement, and the TOWN does not agree, the OWNER may, at its sole cost and expense, seek declaratory relief (or other similar non-monetary remedies); provided, however, that nothing contained in this Section 3.7.3 shall impose on TOWN any monetary liability for contesting such declaratory relief (or other similar non-monetary relief).

3.7.4 Intent. The parties acknowledge and agree that TOWN is restricted in its authority to limit its police power by contract and that the foregoing limitations, reservations and exceptions are intended to reserve to TOWN all of its police power which cannot be so limited. This Agreement shall be construed, contrary to its stated terms if necessary, to reserve to TOWN all such power and authority which cannot be restricted by contract.

3.8 Public Works. If OWNER is required by this Agreement to construct any public works facilities which will be dedicated to TOWN or any other public agency upon completion, and if required by applicable laws to do so, OWNER shall perform such work in the same manner and subject to the same requirements as would be applicable to TOWN or such other public agency should it have undertaken such construction.

3.9 Acquisition of Offsite Real Property Interests. In any instance where OWNER is required by any Development Approval or Land Use Regulation to construct any public improvement on land not owned by OWNER (together, “Offsite Improvements”), OWNER shall at its sole cost and expense provide or cause to be provided, the real property interests necessary for the construction of such public improvements (the “Offsite Property”). In the event OWNER is unable, after exercising reasonable efforts, including, but not limited to, the rights under Sections 1001 and 1002 of the Civil Code, to acquire the Offsite Property necessary for the construction of the Offsite Improvements, and if so instructed by OWNER and upon OWNER’S provision of adequate security for costs TOWN may reasonably incur, TOWN agrees to use reasonable and diligent good faith efforts to acquire the Offsite Property from the owner or owners of record by negotiation to the extent permitted by law and consistent with this Agreement. If TOWN is unable to acquire the Offsite Property by negotiation within thirty (30) days after OWNER’s written request, TOWN shall, in accordance with the procedures established by law, use its power of eminent domain to acquire the Offsite Property at a public hearing noticed and conducted in accordance with California Code of Civil Procedure Section 1245.235 for the purpose of considering the adoption of a resolution of necessity concerning the Offsite Property, subject to the conditions set forth in this Section 3.9. The TOWN and OWNER acknowledge that the timelines set forth in this Section 3.9 represent the maximum time periods which TOWN and OWNER reasonably believe will be necessary to complete the acquisition of any Offsite Property.

TOWN agrees to use reasonable good faith efforts to complete the actions described within lesser time periods, to the extent that it is reasonably able to do so, consistent with the legal constraints imposed upon TOWN. OWNER shall pay all costs associated with such acquisition or

condemnation proceedings. This section 3.9 is not intended by the parties to impose upon the OWNER an enforceable duty to acquire land or construct any public improvements on land not owned by OWNER, except to the extent that the OWNER elects to proceed with the development of the Project, and then only in accordance with valid conditions imposed by the TOWN upon the development of the Project under the Subdivision Map Act or other legal authority.

3.9.1 Owner’s Option to Terminate Proceedings. TOWN shall provide written notice to OWNER no later than fifteen (15) days prior to making an offer to the owner of the Offsite Property. At any time within that fifteen (15) day period, OWNER may, at its option, notify TOWN that it wants TOWN to cease all acquisition proceedings with respect to the Offsite Property, whereupon TOWN shall cease such proceedings. TOWN shall provide written notice to OWNER no later than fifteen (15) days prior to the date of the hearing on TOWN’S intent to consider the adoption of a resolution of necessity as to any Offsite Property. At any time within that fifteen (15) day period, OWNER may, at its option, notify TOWN that it wants TOWN to cease condemnation proceedings, whereupon TOWN shall cease such proceedings. If OWNER does not notify TOWN to cease condemnation proceedings within said fifteen (15) day period, then the TOWN may proceed to consider and act upon the Offsite Property resolution of necessity.

If TOWN adopts such resolution of necessity, then TOWN shall diligently institute condemnation proceedings and file a complaint in condemnation and seek an order of immediate possession with respect to the Offsite Property.

3.10 Regulation by Other Public Agencies. It is acknowledged by the parties that other public agencies not within the control of TOWN possess authority to regulate aspects of the development of the Property separately from or jointly with TOWN and this Agreement does not limit the authority of such other public agencies. TOWN agrees to cooperate, at no cost to TOWN, with OWNER in obtaining any required permits or compliance with the regulations of other public agencies provided such cooperation is not in conflict with any laws, regulations or policies of the TOWN.

3.11 Tentative Tract Maps; Extension. With respect to applications by OWNER for tentative subdivision maps for portions of the Property, TOWN agrees that OWNER may file and process tentative maps in accordance with Chapter 4.5 (commencing with Section 66498.1) of Division 2 of Title 7 of the California Government Code and the applicable provisions of TOWN’s subdivision ordinance, as the same may be amended from time to time. In accordance with the provisions of Section 66452.6 of the Government Code, each tentative subdivision map or tentative parcel map, heretofore or hereafter approved in connection with development of the Property, shall be deemed to have been granted an extension of time to and until the date that is five (5) years following the Effective Date of this Agreement. The TOWN’s Town Council may, in its discretion, extend any such map for an additional period of up to five (5) years beyond its original term, so long as subdivider files a written request for an extension with the TOWN prior to the expiration of the initial five (5) year term.

3.12 Utilities. The Project shall be connected to all utilities necessary to provide adequate water, sewer, gas, electric, and other utility service to the Project. OWNER shall contract with the TOWN for TOWN-owned or operated utilities serving the Project for such prices and on such terms as may be mutually agreed to between the parties.

4. PUBLIC BENEFITS.

4.1 Intent. The parties acknowledge and agree that development of the Property will result in substantial public needs which will not be fully met by the Development Plan and further acknowledge and agree that this Agreement confers substantial private benefits on OWNER which should be balanced by commensurate public benefits. Accordingly, the parties intend to provide consideration to the public to balance the private benefits conferred on OWNER by providing more fully for the satisfaction of the public needs resulting from the Project.

4.2 Development Impact Fees.

4.2.1 Amount and Components of Fee. Development Impact Fees (DIF) shall be paid by OWNER. The Development Impact Fee amounts to be paid by OWNER shall be the amounts that are in effect at the time such amounts are due. Nothing contained in this Agreement shall affect the ability of the TOWN to impose new Development Impact Fees or amend the amounts of existing Development Impact Fees. Additionally, nothing contained in this Agreement shall affect the ability of other public agencies that are not controlled by TOWN to impose and amend, from time to time, Development Impact Fees established or imposed by such other public agencies, even though such Development Impact Fees may be collected by TOWN.

4.2.2 Time of Payment. The Development Impact Fees required pursuant to Subsection

4.2.1 shall be paid to TOWN prior to the issuance of building permits for each industrial building.

No fees shall be payable for building permits issued prior to the Effective Date of this Agreement, but the fees required pursuant to Subsection 4.2.1 shall be paid prior to the re-issuance or extension of any building permit for each industrial building for which such fees have not previously been paid. Notwithstanding the foregoing, deferral of the payment of any Development Impact Fees may be granted pursuant to a separate agreement approved by TOWN pursuant to TOWN policy.

4.2.3 Credits. OWNER may be entitled to credit against the fees required pursuant to Subsection 4.2.1 for the dedication of land, the construction of improvements or the payment of fees. Under no circumstance shall any credit and/or reimbursement exceed the actual costs for any dedication of land, construction of improvements, or payment of fees.

4.3 Responsibility for Construction of Public Improvements.

4.3.1 Timely Construction of Public Infrastructure. The phasing of any areawide infrastructure construction will be as approved by the TOWN. OWNER shall be responsible for the timely construction and completion of all Improvements required for the Project as shown on the attached Exhibits “E.” Unless otherwise specified, all required Improvements, shall be completed and operational prior to, and as a condition precedent to, OWNER requesting and TOWN’s granting of the first certificate of occupancy. All Infrastructure and Improvements shall be completed as required by the applicable conditions of approval.

4.3.2 Construction of DIF Program Infrastructure. To the extent OWNER is required to construct and complete construction of public improvements that are included in TOWN’s Development Impact Fee Program, TOWN agrees that TOWN shall issue DIF Credit in accordance with the provisions of a separate Fee Credit Agreement between TOWN and OWNER.

Limitation on the use of DIF Credit issued to OWNER to offset OWNER’s DIF payment

obligations shall also be subject to the provisions of a separate Fee Credit Agreement. TOWN and OWNER agree that the Fee Credit Agreement between TOWN and OWNER shall comply with TOWN’s adopted policies applicable to such agreements. Under no circumstance shall any credit and/or reimbursement exceed the actual costs for construction of the improvements.

5. [Intentionally Omitted.]

6. REVIEW FOR COMPLIANCE.

6.1 Periodic and Special Reviews.

6.1.1 Time for and Initiation of Periodic Review. The TOWN shall review this Agreement annually, on or before the anniversary of the Effective Date, in order to ascertain the good faith compliance by OWNER with the terms of this Agreement. OWNER shall submit an Annual Monitoring Report to TOWN, in a form acceptable to the Town Manager, along with any applicable processing charge, within thirty (30) days after each anniversary date of the Effective Date of this Agreement. Within thirty (30) days after the receipt of the Annual Monitoring Report, TOWN shall either issue a notice of continuing compliance or a notice of non-compliance and a notice of TOWN’s intent to conduct a Special Review pursuant to Sections 6.1.2 through 6.1.6.

Issuance of a notice of continuing compliance may be issued by the Town Manager or his designee.

The amount of the annual review and administration fee shall be set annually by resolution of the Town Council.

6.1.2 Initiation of Special Review. A special review may be called either by agreement of the parties or by unilateral initiation by the TOWN in one or more of the following ways:
(a) Recommendation of the Planning Director;
(b) Affirmative vote of at least three (3) members of the Planning Commission; or (c) Affirmative vote of at least three (3) members of the Town Council.

6.1.3 Notice of Special Review. The Town Manager shall begin the special review proceeding by giving notice to OWNER that the TOWN intends to undertake a special review of this Agreement. Such notice shall be given at least ten (10) days in advance of the time at which the matter will be considered by the Planning Commission.

6.1.4 Public Hearing. The Planning Commission shall conduct a hearing at which OWNER must demonstrate good faith compliance with the terms of this Agreement. The burden of proof on this issue shall be on OWNER.

6.1.5 Findings upon Public Hearing. The Planning Commission shall determine, upon the basis of substantial evidence, whether OWNER has, for the period under review, complied in good faith with the terms and conditions of this Agreement.

6.1.6 Procedure upon Findings.

(a) If the Planning Commission finds and determines on the basis of substantial evidence that OWNER has complied in good faith with the terms and conditions of this Agreement, during the period under review, the review for that period shall be concluded. (b) If the Planning Commission finds and determines on the basis of substantial evidence that OWNER has not complied in good faith with the terms and conditions of this Agreement, during the period under review, the Planning Commission may recommend to the Town Council to modify or terminate this Agreement.
(c) OWNER may appeal a determination pursuant to paragraph (b) to the Town Council in accordance with TOWN’s rules for consideration of appeals in zoning matters generally.

6.2 Proceedings Upon Modification or Termination. If, upon a finding under Section

6.1.6(b), TOWN determines to proceed with modification or termination of this Agreement, TOWN shall give written notice to OWNER of its intention so to do. The notice shall be given at least thirty (30) calendar days prior to the scheduled hearing and shall contain:
(a) The time and place of the hearing;
(b) A statement as to whether or not TOWN proposes to terminate or to modify the Agreement; and,
(c) Such other information TOWN considers necessary to inform OWNER of the nature of the proceeding and the facts supporting Town’s preliminary findings under Section

6.1.6(b).

6.3 Hearing on Modification or Termination. At the time and place set for the hearing on modification or termination, OWNER shall be given an opportunity to be heard and present witnesses and evidence on its behalf. OWNER shall be required to demonstrate good faith compliance with the terms and conditions of this Agreement. The burden of proof on this issue shall be on OWNER. If the Town Council finds, based upon substantial evidence in the administrative record, that OWNER has not complied in good faith with the terms or conditions of the Agreement, the Town Council may terminate or modify this Agreement and impose such conditions to the action it takes as it considers necessary to protect the interests of the TOWN. The decision of the Town Council shall be final, subject only to judicial review pursuant to Section 1094.5 of the Code of Civil Procedure.

6.4 Certificate of Agreement Compliance. If, at the conclusion of a Periodic or Special Review, OWNER is found to be in compliance with this Agreement, TOWN shall, upon written request by OWNER, issue a Certificate of Agreement Compliance (“Certificate”) to OWNER stating that after the most recent Periodic or Special Review and based upon the information known or made known to the Planning Director and Town Council that (1) this Agreement remains in effect and (2) OWNER is not in default. The Certificate shall be in recordable form, shall contain information necessary to communicate constructive record notice of the finding of compliance, shall state whether the Certificate is issued after a Periodic or Special Review and shall state the anticipated date of commencement of the next Periodic Review. OWNER may record the Certificate with the County Recorder.

Whether or not the Certificate is relied upon by assignees or other transferees or OWNER, TOWN shall not be bound by a Certificate if a default existed at the time of the Periodic or Special Review, but was concealed from or otherwise not known to the Planning Director or Town Council.

6.5 No Cross-Defaults. TOWN acknowledges that OWNER may transfer, sell or assign all or portions of the Property to other persons in accordance with Section 2.4. TOWN further acknowledges that title to all or portions of the Property may become vested in Mortgagees or a Mortgagee’s successor as a result of foreclosure, or the acceptance of a deed in lieu of foreclosure, by a Mortgagee. TOWN agrees that defaults under this Agreement by an owner of a portion of the Property will not be a default as to any other portion of the Property. In other words, a default by OWNER with respect to its obligations pertaining to that portion of the Property retained by OWNER following a transfer, sell, or assignment will not constitute a default as to any person other than OWNER or permit TOWN to exercise any remedy under this Agreement or otherwise with respect to any other portion of the Property other than that portion owned by OWNER.

Similarly, a default by a transferee with respect to its obligations pertaining to the portion of the Property owned by that transferee will not constitute OWNER’s default or permit TOWN to exercise any remedy under this Agreement or otherwise as to any portion of the Property other than the portion owned by the defaulting transferee. TOWN agrees that, if more than one person holds title to the Property, then the rights and obligations of the persons holding title to the Property are the distinct and several obligations of each person.

7. DEFAULT AND REMEDIES.

7.1 Remedies in General. It is acknowledged by the parties that TOWN would not have entered into this Agreement if it were to be liable for monetary damages under this Agreement, or with respect to this Agreement or the application thereof.

In general, each of the parties hereto may pursue any remedy at law or equity available for the breach of any provision of this Agreement, except that neither party shall be liable in monetary damages (other than attorney’s fees under Section 10.22) to the other party, or to any successor in interest, or to any other person, and each party covenants not to sue for damages or claim any damages:
(a) For any breach of this Agreement or for any cause of action which arises out of this Agreement; or
(b) For the taking, impairment or restriction of any right or interest conveyed or provided under or pursuant to this Agreement; or
(c) Arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

7.2 Specific Performance. The parties acknowledge that money damages and remedies at law generally are inadequate and specific performance and other non-monetary relief are particularly appropriate remedies for the enforcement of this Agreement and should be available to all parties for the following reasons:

(a) Money damages are unavailable against the parties as provided in Section 7.1 above.
(b) Due to the size, nature and scope of the Project, it may not be practical or possible to restore the Property to its natural condition once implementation of this Agreement has begun.

After such implementation, OWNER may be foreclosed from other choices it may have had to utilize the Property or portions thereof. OWNER has invested significant time and resources and performed extensive planning and processing of the Project in agreeing to the terms of this Agreement and will be investing even more significant time and resources in implementing the Project in reliance upon the terms of this Agreement, and it is not possible to determine the sum of money which would adequately compensate OWNER for such efforts were TOWN to breach its obligations.

7.3 Release. Except for non-damage remedies, including the remedy of specific performance and judicial review as provided for in Sections 7.2 and 6.3, respectively, and the right to recover attorney’s fees under Section 10.22, OWNER, for itself, its successors and assignees, hereby releases the TOWN, its officers, agents and employees from any and all claims, demands, actions, or suits of any kind or nature arising out of any liability, known or unknown, present or future, including, but not limited to, any claim or liability, based or asserted, pursuant to Article I, Section 19 of the California Constitution, the Fifth Amendment of the United States Constitution, or any other law or ordinance which seeks to impose any other liability or damage, whatsoever, upon the TOWN because it entered into this Agreement or because of the terms of this Agreement.

7.4 Termination or Modification of Agreement for Default of OWNER. Subject to the provisions contained in Subsection 6.3 herein, TOWN may terminate or modify this Agreement for any failure of OWNER to perform any material duty or obligation of OWNER under this Agreement, or to comply in good faith with the terms of this Agreement (hereinafter referred to as “default”); provided, however, TOWN may terminate or modify this Agreement pursuant to this Section only after providing written notice to OWNER of default setting forth the nature of the default and the actions, if any, required by OWNER to cure such default and, where the default can be cured, OWNER has failed to take such actions and cure such default within 60 days after the effective date of such notice or, in the event that such default cannot be cured within such 60 day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such 60 day period and to diligently proceed to complete such actions and cure such default.

7.5 Termination of Agreement for Default of TOWN. OWNER may terminate this Agreement only in the event of a default by TOWN in the performance of a material term of this Agreement and only after providing written notice to TOWN of default setting forth the nature of the default and the actions, if any, required by TOWN to cure such default and, where the default can be cured, TOWN has failed to take such actions and cure such default within 60 days after the effective date of such notice or, in the event that such default cannot be cured within such 60 day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such 60 day period and to diligently proceed to complete such actions and cure such default.

7.6 Informal Resolution. During the administration and implementation of this Agreement, the parties recognize that good faith disagreements may arise between TOWN staff and OWNER. In the event that a dispute arises, the Parties will meet and confer in a good-faith attempt to resolve the dispute.

8. THIRD PARTY LITIGATION.

8.1 General Plan Litigation. TOWN has determined that this Agreement is consistent with its Comprehensive General Plan, as such called General Plan exists as of the Effective Date (“General Plan”), and that the General Plan meets all requirements of law. OWNER has reviewed the General Plan and concurs with TOWN’s determination.

TOWN shall have no liability in damages under this Agreement for any failure of TOWN to perform under this Agreement or the inability of OWNER to develop the Property as contemplated by the Development Plan of this Agreement as the result of a judicial determination that on the Effective Date, or at any time thereafter, the General Plan, or portions thereof, are invalid or inadequate or not in compliance with law.

8.2 Third Party Litigation Concerning Agreement. OWNER shall defend, at its expense, including attorneys’ fees, indemnify, and hold harmless TOWN, its agents, officers and employees from any claim, action or proceeding against TOWN, its agents, officers, or employees to attack, set aside, void, or annul the approval of this Agreement or the approval of any permit granted pursuant to this Agreement. TOWN shall promptly notify OWNER of any such claim, action or proceeding, and TOWN shall cooperate in the defense. If TOWN fails to promptly notify OWNER of any such claim, action or proceeding, or if TOWN fails to cooperate in the defense, OWNER shall not thereafter be responsible to defend, indemnify, or hold harmless TOWN.

TOWN may in its discretion participate in the defense of any such claim, action or proceeding.

8.3 Indemnity. In addition to the provisions of 8.2 above, OWNER shall indemnify and hold TOWN, its officers, agents, employees and independent contractors free and harmless from any liability whatsoever, based or asserted upon any act or omission of OWNER, its officers, agents, employees, subcontractors and independent contractors, for property damage, bodily injury, or death (OWNER’s employees included) or any other element of damage of any kind or nature, relating to or in any way connected with or arising from the activities contemplated hereunder, including, but not limited to, the study, design, engineering, construction, completion, failure and conveyance of the public improvements, save and except claims for damages arising through the sole negligence or sole willful misconduct of TOWN. OWNER shall defend, at its expense, including attorneys’ fees, TOWN, its officers, agents, employees and independent contractors in any legal action based upon such alleged acts or omissions. TOWN may in its discretion participate in the defense of any such legal action.

8.4 Environment Assurances. OWNER shall indemnify and hold TOWN, its officers, agents, and employees free and harmless from any liability, based or asserted, upon any act or omission of OWNER, its officers, agents, employees, subcontractors, predecessors in interest, successors, assigns and independent contractors for any violation of any federal, state or local law, ordinance or regulation relating to industrial hygiene or to environmental conditions on, under or about the Property, including, but not limited to, soil and groundwater conditions, and OWNER

shall defend, at its expense, including attorneys’ fees, TOWN, its officers, agents and employees in any action based or asserted upon any such alleged act or omission. TOWN may in its discretion participate in the defense of any such action.

8.5 Reservation of Rights. With respect to Sections 8.2, 8.3 and 8.4 herein, TOWN reserves the right to either (1) approve the attorney(s) which OWNER selects, hires or otherwise engages to defend TOWN hereunder, which approval shall not be unreasonably withheld, or (2) conduct its own defense, provided, however, that OWNER shall reimburse TOWN forthwith for any and all reasonable expenses incurred for such defense, including attorneys’ fees, upon billing and accounting therefor.

8.6 Survival. The provisions of this Sections 8.1 through 8.6, inclusive, shall survive the termination of this Agreement.

9. MORTGAGEE PROTECTION.

The parties hereto agree that this Agreement shall not prevent or limit OWNER, in any manner, at OWNER’s sole discretion, from encumbering the Property or any portion thereof or any improvement thereon by any mortgage, deed of trust or other security device securing financing with respect to the Property. TOWN acknowledges that the lenders providing such financing may require certain Agreement interpretations and modifications and agrees upon request, from time to time, to meet with OWNER and representatives of such lenders to negotiate in good faith any such request for interpretation or modification. TOWN will not unreasonably withhold its consent to any such requested interpretation or modification provided such interpretation or modification is consistent with the intent and purposes of this Agreement. Any Mortgagee of the Property shall be entitled to the following rights and privileges:
(a) Neither entering into this Agreement nor a breach of this Agreement shall defeat, render invalid, diminish or impair the lien of any mortgage on the Property made in good faith and for value, unless otherwise required by law.
(b) The Mortgagee of any mortgage or deed of trust encumbering the Property, or any part thereof, which Mortgagee, has submitted a request in writing to the TOWN in the manner specified herein for giving notices, shall be entitled to receive written notification from TOWN of any default by OWNER in the performance of OWNER’s obligations under this Agreement. (c) If TOWN timely receives a request from a mortgagee requesting a copy of any notice of default given to OWNER under the terms of this Agreement, TOWN shall provide a copy of that notice to the Mortgagee within ten (10) days of sending the notice of default to OWNER. The Mortgagee shall have the right, but not the obligation, to cure the default during the remaining cure period allowed such party under this Agreement.
(d) Any Mortgagee who comes into possession of the Property, or any part thereof, pursuant to foreclosure of the mortgage or deed of trust, or deed in lieu of such foreclosure, shall take the Property, or part thereof, subject to the terms of this Agreement. Notwithstanding any other provision of this Agreement to the contrary, no Mortgagee shall have an obligation or duty under this Agreement to perform any of OWNER’s obligations or other affirmative covenants of OWNER hereunder, or to guarantee such performance; provided, however, that to the extent that

any covenant to be performed by OWNER is a condition precedent to the performance of a covenant by TOWN, the performance thereof shall continue to be a condition precedent to TOWN’s performance hereunder, and further provided that any sale, transfer or assignment by any Mortgagee in possession shall be subject to the provisions of Section 2.4 of this Agreement.

10. MISCELLANEOUS PROVISIONS.

10.1 Recordation of Agreement. This Agreement and any amendment or cancellation thereof shall be recorded with the San Bernardino County Recorder by the Town Clerk within ten (10) days of TOWN’s entry into this Agreement, as required by Section 65868.5 of the Government Code. If the parties to this Agreement or their successors in interest amend or cancel this Agreement as provided for herein and in Government Code Section 65868, or if the TOWN terminates or modifies the agreement as provided for herein and in Government Code Section 65865.1 for failure of the applicant to comply in good faith with the terms or conditions of this Agreement, the Town Clerk shall have notice of such action recorded with the San Bernardino County Recorder.

10.2 Entire Agreement. This Agreement sets forth and contains the entire understanding and agreement of the parties, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements which are not contained or expressly referred to herein. No testimony or evidence of any such representations, understandings or covenants shall be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement.

10.3 Severability. If any term, provision, covenant or condition of this Agreement shall be determined invalid, void or unenforceable, the remainder of this Agreement shall not be affected thereby to the extent such remaining provisions are not rendered impractical to perform taking into consideration the purposes of this Agreement. Notwithstanding the foregoing, the provision of the Public Benefits set forth in Section 4 of this Agreement, including the payment of the fees set forth therein, are essential elements of this Agreement and TOWN would not have entered into this Agreement but for such provisions, and therefore in the event such provisions are determined to be invalid, void or unenforceable, this entire Agreement shall be null and void and of no force and effect whatsoever.

10.4 Interpretation and Governing Law. This Agreement and any dispute arising hereunder shall be governed and interpreted in accordance with the laws of the State of California.

This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the parties hereto, and the rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in interpreting this Agreement, all parties having been represented by counsel in the negotiation and preparation hereof.

10.5 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement.

10.6 Singular and Plural. As used herein, the singular of any word includes the plural.

10.7 [Intentionally Omitted.]

10.8 Time is of the Essence. Time is of the essence in the performance of .the provisions of this Agreement as to which time is an element.

10.9 Waiver. Failure by a party to insist upon the strict performance of any of the provisions of this Agreement by the other party, or the failure by a party to exercise its rights upon the default of the other party, shall not constitute a waiver of such party’s right to insist and demand strict compliance by the other party with the terms of this Agreement thereafter.

10.10 No Third Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit of the parties and their successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

10.11 Force Majeure. Neither party shall be deemed to be in default where failure or delay in performance of any of its obligations under this Agreement is caused by floods, earthquakes, other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties beyond the party’s control, (including the party’s employment force), government regulations, court actions (such as restraining orders or injunctions), or other causes beyond the party’s control. If any such events shall occur, the term of this Agreement and the time for performance by either party of any of its obligations hereunder may be extended by the written agreement of the parties for the period of time that such events prevented such performance, provided that the term of this Agreement shall not be extended under any circumstances for more than five (5) years.

10.12 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the party benefited thereby of the covenants to be performed hereunder by such benefited party.

10.13 Successors in Interest. The burdens of this Agreement shall be binding upon, and the benefits of this Agreement shall inure to, all successors in interest to the parties to this Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes and constitute covenants running with the land. Each covenant to do or refrain from doing some act hereunder with regard to development of the Property: (a) is for the benefit of and is a burden upon every portion of the Property; (b) runs with the Property and each portion thereof; and, (c) is binding upon each party and each successor in interest during ownership of the Property or any portion thereof.

10.14 Counterparts. This Agreement may be executed by the parties in counterparts, which counterparts shall be construed together and have the same effect as if all of the parties had executed the same instrument.

10.15 Jurisdiction and Venue. Any action at law or in equity arising under this Agreement or brought by a party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Superior Court of the County of San Bernardino, State of California, and the parties hereto waive all provisions of law providing for the filing, removal or change of venue to any other court.

10.16 Project as a Private Undertaking. It is specifically understood and agreed by and between the parties hereto that the development of the Project is a private development, that neither party is acting as the agent of the other in any respect hereunder, and that each party is an

independent contracting entity with respect to the terms, covenants and conditions contained in this Agreement. No partnership, joint venture or other association of any kind is formed by this Agreement. The only relationship between TOWN and OWNER is that of a government entity regulating the development of private property and the owner of such property.

10.17 Further Actions and Instruments. Each of the parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement.

Upon the request of either party at any time, the other party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by this Agreement. The Town Manager may delegate his or her powers and duties under this Agreement to an Assistant Town Manager or other management level employee of the TOWN.

10.18 Eminent Domain. No provision of this Agreement shall be construed to limit or restrict the exercise by TOWN of its power of eminent domain.

10.19 Agent for Service of Process. In the event OWNER is not a resident of the State of California or it is an association, partnership or joint venture without a member, partner or joint venturer resident of the State of California, or it is a foreign corporation, then in any such event, OWNER shall file with the Planning Director, upon its execution of this Agreement, a designation of a natural person residing in the State of California, giving his or her name, residence and business addresses, as its agent for the purpose of service of process in any court action arising out of or based upon this Agreement, and the delivery to such agent of a copy of any process in any such action shall constitute valid service upon OWNER. If for any reason service of such process upon such agent is not feasible, then in such event OWNER may be personally served with such process out of this County and such service shall constitute valid service upon OWNER. OWNER is amenable to the process so served, submits to the jurisdiction of the Court so obtained and waives any and all objections and protests thereto. OWNER for itself, assigns and successors hereby waives the provisions of the Hague Convention (Convention on the Service Abroad of Judicial and Extra Judicial Documents in Civil or Commercial Matters, 20 U.S.T. 361, T.I.A.S. No. 6638).

10.20 Estoppel Certificate. Within thirty (30) days following a written request by any of the parties, the other party shall execute and deliver to the requesting party a statement certifying that (i) either this Agreement is unmodified and in full force and effect or there have been specified (date and nature) modifications to the Agreement, but it remains in full force and effect as modified; and (ii) either there are no known current uncured defaults under this Agreement or that the responding party alleges that specified (date and nature) defaults exist. The statement shall also provide any other reasonable information requested. The failure to timely deliver this statement shall constitute a conclusive presumption that this Agreement is in full force and effect without modification except as may be represented by the requesting party and that there are no uncured defaults in the performance of the requesting party, except as may be represented by the requesting party. OWNER shall pay to TOWN all costs incurred by TOWN in connection with the issuance of estoppel certificates under this Section 10.20 prior to TOWN’s issuance of such certificates.

10.21 Authority to Execute. The person or persons executing this Agreement on behalf of a party warrants and represents that he or she/they have the authority to execute this Agreement on behalf of his or her/their corporation, partnership or business entity and warrants and represents that he or she/they has/have the authority to bind that party to the performance of its obligations hereunder.

10.22 Attorneys’ Fees. If either Party files any action or brings any action or proceeding against the other pertaining to the interpretation or enforcement of this Agreement, then the prevailing Party will recover as an element of its costs of suit and not as damages its costs of suit, expert fees, consultant costs, and reasonable attorneys’ fees as fixed by the Court.

IN WITNESS WHEREOF, the parties hereto have executed this Development Agreement on the day and year set forth below.
[SIGNATURES CONTAINED ON FOLLOWING PAGE]

SIGNATURE PAGE
TO DEVELOPMENT AGREEMENT NO. 2026-002

COV APPLE VALLEY LLC,
a Delaware limited liability company
By: ________________________________
Name and Title:

Date: ___________________

TOWN OF APPLE VALLEY,
a California municipal corporation
By: ________________________
Scott Nassif, Mayor

Date: ___________________
ATTEST:

By: _________________________________
Kiel E. Mangerino, Acting Town Clerk
APPROVED AS TO FORM:

By: ______________________________
Thomas Rice, Town Attorney

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 and title of the officer)
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 capacities(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 _________________________________ (Seal)

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 and title of the officer)
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 capacities(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 _________________________________ (Seal)

EXHIBIT "A"

EXHIBIT "B"

Community Development
November 16, 2023
Covington Development Partners
3 Corporate Plaza #230
Newport Beach, Ca 92660
Subject: Development Permit No. 2022-016, to construct a 2.5 million square foot industrial warehousing distribution development; and Tentative Parcel Map No. 20674 to establish three parcels from approximately 143 acres within the Regional Commercial (C-R) zoning district located on the north side of Stoddard Wells Road, and 2,500 feet east of Interstate 15 Freeway.

Dear Applicant:

At its November 15, 2023, regularly scheduled meeting, the Planning Commission approved the abovementioned proposal to allow the construction of a 2.5 million square foot industrial warehousing distribution development; and Tentative Parcel Map No. 20674 to establish three parcels from approximately 143 acres within the Regional Commercial (C-R) zoning district.

This action of the Town of Apple Valley shall not be final for a period of ten (10) days from the date of this letter to allow for the filing of any appeal pursuant to the Town’s Development Code, Section

9.12.250, with the Town Clerk of the Town of Apple Valley.

This approval shall expire on November 15, 2026, unless the construction has substantially commenced in accordance with the Development Code.

Enclosed you will find the conditions as approved by the Planning Commission and as accepted by you at the public hearing. If you have any questions on this matter, please contact me at (760) 240-7200 ext. 7202, [email protected]. Town offices are open Monday through Thursday between 7:30 a.m. and 5:30 p.m., and alternating Fridays between 7:30 a.m. and 4:30 p.m. (closed the subsequent Fridays).

Sincerely,
Amanda Malone
Assistant Planner
1 EXHIBIT "C"

TOWN OF APPLE VALLEY

CONDITIONS OF APPROVAL
Case No. Development Permit 2022-016 & Tentative Parcel Map No. 20674 Please note: Many of the suggested Conditions of Approval presented herewith are provided for informational purposes and are otherwise required by the Municipal Code. Failure to provide a Condition of Approval herein that reflects a requirement of the Municipal Code does not relieve or alleviate the applicant and/or property owner from full conformance and adherence to all requirements of the Municipal Code.

Planning Division Conditions of Approval
P1. This project shall comply with the provisions of State law and the Town of Apple Valley Development Code and the General Plan. This conditional approval, if not exercised, shall expire three (3) years from the date of action of the reviewing authority, unless otherwise extended pursuant to the provisions of application of State law and local ordinance. The extension application must be filed, and the appropriate fees paid, at least sixty (60) days prior to the expiration date. The Site Plan Review shall become effective ten (10) days from the date of the decision unless an appeal is filed as stated in the Town’s Development Code.

P2. The applicant shall agree to defend, at its sole expense (with attorneys approved by the Town), hold harmless and indemnify the Town, its agents, officers and employees, against any action brought against the Town, its agents, officers or employees concerning the approval of this project or the implementation or performance thereof, and from any judgment, court costs and attorney's fees which the Town, its agents, officers or employees may be required to pay as a result of such action. The Town may, at its sole discretion, participate in the defense of any such action, but such participation shall not relieve the applicant of this obligation under this condition.

P3. Prior to the issuance of a Building Permit, the following agencies shall provide written verification as necessary to the Planning Division that all pertinent conditions of approval and applicable regulations have been met:

Apple Valley Fire Protection District Apple Valley
Public Services Department Apple Valley
Engineering Division Liberty Utilities
California State Fish and Wildlife
P4. The approval of Development Permit No. 2022-016 and Tentative Parcel Map No. 20674 by the Planning Commission is recognized as acknowledgment of

2 Conditions of Approval by the applicant, unless an appeal is filed in accordance with Section

9.12.250, Appeals, of the Town of Apple Valley Development Code.

P5. Prior to issuance of any building permit, the applicant(s) shall sign and complete an "Acknowledgment of Conditions” and shall return the executed original to the Planning Division for inclusion in the case records.

P6. The site plan and elevations presented to and approved with Conditions by the Planning Commission at the public hearing shall be the anticipated and expected appearance of the structure upon completion.

P7. The filing of a Notice of Determination (NOD) made payable to the Clerk of The Board of Supervisors in the amount of $3,839.25, plus a handling fee of $50.00 shall be required.

The fee must be paid in a timely manner in accordance with Town procedures. No permits may be issued until such fee is paid.

P8. No deviation, modification, alteration, adjustment, or revision to or from the appearance, location, fixtures, features or appurtenances thereto of any type or extent shall be approved without said changes being first submitted to the Planning Division for consideration and approval.

P9. Any equipment, whether on the roof, side of the structure or ground, shall be screened from public view from adjacent property or from a public right-of-way. The method of screening shall be integrated into the architectural design of the building and/or landscaping.

P10. Exterior lighting plans, including a photometric site plan shall be included within the building plans that demonstrates all lighting is contained within the site. If lights are proposed to be mounted on the building exterior, down-lights or fully shielded lights shall be used.

P11. All lighting shall be scheduled so light rays emitted by the fixture are projected below the imaginary horizontal plane passing through the lowest point of the fixture and in such a manner that the light is directed away from streets and adjoining properties. Light poles in parking lot shall not exceed twenty (20) feet in height.

P12. Parking requirements shall be met and be in compliance with Town standards. All parking stalls shall be clearly striped and permanently maintained with double or hairpin lines.

P13. Required parking spaces shall be provided for the handicapped in accordance with Town standards and in accordance with Title 24 of the California Administrative Code. The handicapped spaces shall be located as close as practical to the entrance of the center. Each space must be provided with access ramps and clearly marked in accordance with Title 24 of the California Administrative Code.

3 P14. The landscape plans that were submitted are conceptual. Final landscape and irrigation plans shall be submitted prior to the issuance of any Building Permits and shall be installed prior to the issuance of occupancy permits, subject to approval of the Planning Division. Landscaping shall be installed with appropriate combinations of drought tolerant trees, shrubs, and ground cover, consistent with Chapter 9.75, Water Conservation Landscape Regulations, of this Code.

P15. All required and installed landscape shall incorporate and maintain a functioning automatic sprinkler system, and said landscaping shall be maintained in a neat, orderly, disease and weed free manner at all times.

P16. Additional landscaping treatments shall be implemented to screen large buildings adjacent to the Interstate 15 Freeway, on-site parkways and secondary roadways, and/or residential uses. Plant materials shall consist of compact evergreen plants. Such planting shall be of a kind or used in such a manner as to provide screening with a minimum thickness of two (2) feet within eighteen (18) months after initial installation. Permanent automatic irrigation shall be provided.

P17. All fencing and screening material shall be in conformance with the Development Code subject to approval by the Planning Division.

P18. A Wall Height Permit shall be required for a wall or fence above six (6) feet in height, up to a maximum of eight (8) feet in height. A Conditional Use Permit shall be required for a wall or fence above eight feet and two inches (8’2”) in height.

P19. The trash enclosures shall be in accordance with Town Standards. Variation in its configuration may be approved by the Planning Division. Consistent with Town standard, the enclosure walls shall be block, masonry or similar with a solid metal gate.

P20. All litter shall be removed from the exterior area around the premises including adjacent public sidewalk areas and parking areas no less frequently than once each day that the business is open.

P21. The premises shall be maintained in a clean, weed-free and disease-free manner at all times.

P22. All identification signs shall have a separate permit and are subject to final approval by the Town Planning Division.

P23. Joshua Tree removal or relocation shall require that an Incidental take Permit or any other applicable permit, or measure, be complied with and obtained by the California Department of Fish and Wildlife (CDFW).

P24. All Mitigation Measures required by the certified Environmental Impact Report (EIR) and Mitigation Monitoring and Reporting Program (MMRP) shall be complied

4 with as indicated in the EIR and MMRP, including prior to issuance of ground disturbance; prior to building permit issuance; during construction; prior to issuance of certificate of occupancy; and during the life of the project.

Engineering Division Conditions of Approval
EC1. Prior to issuance of a grading permit, a final drainage plan with street layouts shall be submitted for review and approval by the Town Engineer showing provisions for receiving and conducting offsite and onsite tributary drainage flows around or through the site in a manner which will not adversely affect adjacent or downstream properties. This plan shall consider retaining onsite drainage flows from a 100-year design storm. (Town Resolution 2000-50; Development Code 9.28.050.C, 9.28.100)
EC2. Street improvement plans shall be submitted to the Town Engineer for review and approval.

EC3. All streets abutting the development shall be improved a minimum half-width of 28 feet with curb, gutter, and sidewalk on the development side.

EC4. Stoddard Wells Road adjacent to the property shall be improved to the Town's halfwidth Major Divided Arterial Street standards.

EC5. Outer Interstate-15 (new public road) adjacent to the east boundary of the property shall be improved to the Town's half-width Secondary Street standards.

EC6. A 64-ft wide half-width road dedication along Stoddard Wells Road adjacent to the property shall be granted to the Town of Apple Valley prior to Final Map approval.

EC7. A 44-ft wide half-width road dedication along Outer Interstate-15 (new public road) adjacent to the east boundary shall be granted to the Town of Apple Valley prior to Final Map approval.

EC8. During the grading of the roads, soils testing of the road subgrades by a qualified soils engineering firm shall be performed to determine appropriate structural road section. Minimum asphalt concrete thickness for all streets shall be 0.33 ft.

EC9. An encroachment permit shall be obtained from the Town prior to performing any work in any public right of way.

EC10. Final improvement plans and profiles shall indicate the location of any existing utility which would affect construction and shall provide for its relocation at no cost to the Town.

5 EC11. A final grading plan shall be submitted to the Town Engineer prior to issuance of a grading permit for review and approval. A grading permit shall not be issued until street improvement plans have been submitted to the Town Engineer for review and substantial completion of the street plans has been attained as determined by the Town Engineer.

EC12. All Road Names shall be approved by the Town and such approval shall be coordinated through the Town Engineer.

EC13. Utility lines shall be placed underground in accordance with the requirements of the Town.

EC14. Traffic impact fees adopted by the Town (Ordinance No. 42) shall be paid by the developer.

EC15. Any developer fees including but not limited to drainage fees shall be paid by the developer as per Town enactment.

EC16. Any required street striping shall be thermoplastic as approved by the Town Engineer.

EC17. All traffic mitigation measure required by Caltrans shall be constructed or required as approved by Caltrans.

EC18. All traffic mitigation measures recommended by the Dudek Traffic Impact Analysis on “Table 24. Proposed Improvement Measures” shall be constructed prior to final occupancy.

EC19. Fair-share contributions shall be required as recommended by the Dudek Traffic Impact Analysis listed on “Table 25. Fair Share Summary”, and Table 26 “Project Fair Share Cost Estimates”, and shall be paid, as approved by the Town Engineer, prior to final occupancy.

Building and Safety Division Conditions of Approval
BC1. An engineered grading report including soils report shall be submitted to and approved by the Building Official prior to recordation of the final map or issuance of permits for grading in excess of 1,000 cubic yards.

BC2. Grading and drainage plans must be submitted to and approved by the Building Official, Planning Department and Town Engineer prior to permit issuance.

BC3. Submit plans and obtain permits for all structures and retaining walls, signs.

BC4. A pre-construction permit and inspection are required prior to any land disturbing activity to verify requirements for erosion control, flood hazard native plant

6 protection and desert tortoise habitat.

BC5. A Notice of Intent (NOI) and Storm Water Prevention Plan (SWPP) must be submitted to and approved by the Engineering and Building Departments prior to issuance of a grading permit and or any land disturbance.

BC6. All utilities shall be placed underground in compliance with Town Ordinance No.

89. BC7. A cross lot drainage requires easements and may require improvements at the time of development.

BC8. Comply with the State of California Disability Access requirements.

BC9. A pre-grading meeting is required prior to beginning any land disturbance. This meeting will include the Building Inspector, General Contractor, Grading Contractor, soils technician and any other parties required to be present during the grading process such as a Biologist and/or Paleontologist.

BC10. A dust palliative or hydro seed will be required on those portions of the site graded but not constructed (phased construction)
BC11. Page two of the submitted building plans will be the Conditions of Approval.

BC12. Construction must comply with the applicable California Building Codes and green Building Code.

BC13. Best Management Practices (BMP’s) are required for the site during construction.

BC14. Provide Water Quality Management Plan (WQMP) or Alternative Compliance Plan.

Public Works Conditions of Approval
PW1. Sewage disposal shall be by extension off the Victor Valley Wastewater Reclamation Authority (VVWRA) interceptor.
a. A six (6) inch lateral is required off the extension.

PW2. Submit plans to Town of Apple Valley Public Works Department for review. Plans must be approved by VVWRA and the Town of Apple Valley Public Works Department.

PW3. Sewer connection fees required