Agenda, first session — Highland City Council, February 13, 2024

DATE:

TO:

FROM:

SUBJECT
Memorandum
City of Highland
February 13, 2024
City Council
Carlos Zamano, Public Works Director/ City Engineer
Kim Stater, Asst. Community Development Director
City CouncilAgendaItem #9 — San Carlo Townhomes
Thismemois associatedwith City CouncilAgendaItem #9, approvalof a ProjectImprovement Agreementto permittheresidentialoccupancyof theSanCarloTownhomesprior to the constructionof atraffic signalatGreenspotRoadandCalhounRoad. TheCity Council amendedtheproject'sEngineeringConditionsofApprovalattheJanuary9thmeetingand agreedtotheconceptthattheCitywouldallowoccupancyof allbutthelast8-unitbuildingso longastheApplicantconstructedinterimsafetytrafficcontrolmeasuresinthemedian, installed no u-turn sign at Greenspot Road and Webster Street, and bonded for the ultimate construction of thetraffic signal. With this direction, staffproceededwith preparationof theAgreementas included in the Agenda ( Version 1).

Subsequenttopreparationof theAgenda, theApplicantrequestedmodificationstoclarifythe scopeof work andinsurancecoverage. Theseamendmentsareshownin trackchangesin Version 2 attached.

Additionally, theApplicantrequestedtoremovetheholdonthelastbuildingoccupancyand insteadrequeststheestablishmentof a6-monthtimelinein which to constructthetraffic signal with anoptionto extendthecompletionperiodupto anadditionalsix monthsby theCity Engineer, attheApplicant'srequest, if at leastfifty percentprogresstowardstheconstructionof the traffic signal hasbeen made. This is attachedasVersion 3.

StaffrecommendstheCouncil adoptVersion3, which hasbeenreviewedby the City Attorney, asissimilartotheconceptacceptedbyCouncilattheJanuary9thmeeting.

Version 2
Amendments to Scope of Work and Insurance

CITY OF HIGHLAND

PROJECT IMPROVEMENT AGREEMENT
REFERENCE DATA* * * * * *
PROJECT NO. DRA 20- 006
NAME OF PROJECT ( hereinafter " Project"): San Carlo I, Highland Townhome Apartments

NAME AND ADDRESS
OF THE DEVELOPER( S): San Carlo Apartment Homes LLC
2518 North Santiago Blvd.

Orange, California 92867
CITYCOUNCILRESOLUTIONNOs. 2020-049and2024-001 (hereinafter "Resolutionof Approval")
IMPROVEMENT PLANS NO. Traffic Signal Calhoun Road at GreenspotRoad hereinafter " Improvement Plans," which include all Project specifications) IMPROVEMENTS: See Schedule A
ESTIMATED TOTAL COSTSOFIMPROVEMENTS: $ 500, 000
hereinafter "Estimated Total Costs")
FORM OF IMPROVEMENT SECURITY: Surety bonds
NAME AND ADDRESS OF SURETY:

SURETY BOND NUMBERS:

EFFECTIVE DATE OF AGREEMENT:

Performance Bond: $ 500, 000
Payment Bond: $ 250, 000
Warranty Bond: $ 125, 000
February 13, 2024
COMPLETIONPERIOD: AllImprovements (asdefinedinRecitalB) oftheProjectshallbe completedpriortotheissuanceofacertificateofoccupancyforthelastresidentialbuildingon theProjectsiteconsistingof atleasteightresidentialunits. 11026- 000 1\2910473v Ldoc I
THIS PROJECT IMPROVEMENT AGREEMENT (" Agreement") is made and entered into by andbetweentheCity of Highland, amunicipalcorporation ("City"), and the Developer whose name and address is set forth above in the Reference Data.

RECITALS
A. TheDeveloperhaspresentedtotheCityforapprovalaproposedProject, identified abovein the ReferenceData, pursuantto the City's ordinancesandregulations. The City has conditionallyapprovedthatProjectbyadoptingtheResolutionofApproval, whichisincorporated into this Agreement by this reference.

C. In considerationof approvalof the Projectby the City, the Developerdesiresto enterinto this Agreementwherebythe Developerpromisesto install and complete, at its sole expense, the Improvements. The Developer has securedthis Agreement by improvement security required under this Agreement.

D. Improvement Plans, numbered as designatedabove in the Reference Data, for the construction, installation and completion of the Improvementshave been preparedby the Developer, approvedby theCity Engineer, andareonfile in theoffice of the City Engineer.

AGREEMENT
NOW, THEREFORE, in consideration of the approval by the City Council of the Resolution of Approval, the Developer and the City agreeasfollows:

1. THE DEVELOPER' S OBLIGATION TO CONSTRUCT IMPROVEMENTS A. The Developer shall, at its sole expense, and in compliance with the ImprovementPlansandall applicableCity standardsandfees, andin a goodandworkmanlike fashion, furnish, construct, install and guaranteeand warranty (as set forth in Section3) the Improvementsmorespecificallydescribedin theCity Council's Resolutionof Approval.

B. Developer shall complete all Improvements within the Completion Period specified in the Reference Data.

C. The Developer shall, at its sole expense, replace or repair all public improvementsrelatedto SanCarloI project, publicproperty, orpublicutility facilitieswhichare destroyedor damaged as a result of any work under this Agreement. Any such replacement or 11026- 0001\ 2910473v1. doc 2
repair shall be subject to the approval of the City Engineer.

D. Until the Improvementsareacceptedby the City, the Developershall be responsiblefor the careandmaintenanceof suchImprovementsandshallbearall risksof lossor damageto saidImprovements. NeithertheCity, nor its officers, agentsnor employeesshallhave anyliabilityforanyaccident, lossordamagetotheImprovementspriortotheircompletionand acceptance by the City.

E. The Developer shall, at its sole expense, obtain all necessarypermits and licensesfor theconstructionandinstallationof theImprovements, give all necessarynotices, and payallfeesrequiredbytheCity'sordinanceorresolutionandalltaxesrequiredbylaw.

F. Not less than fifteen (15) daysprior to commencementof work on the Improvements, the Developershallgive written noticeto theCity Engineerof the datefixed for suchcommencementof work so thattheCity Engineershallhaveadequatetime to scheduleall necessary inspections.

G. The Developershallpay all City feesandcostsstipulatedin the latestfee resolutionasadoptedbytheCityCouncilfromtimetotimeasrequiredforthedevelopmentof the Project, whichmayinclude, butis notlimitedto, buildingpermitfees, gradingpermitfees, plan checkfees, encroachmentpermit fees, andinspectionfees.

2. INSPECTION OF WORK AND FINAL ACCEPTANCE
A. The Developer shall at all times maintain proper facilities and safe access for inspectionof theImprovementsby theCity EngineerandotherCity personnelandinspection consultants.

B. Upon completion of Improvements, the Developer shall request a final inspection by the City Engineer. Within ten ( 10) business days of any inspection of the Improvements, theCityEngineershallprovidewrittennoticetotheDeveloperof thelistof items which havebeen found to be incompleteand the list of items which havebeen found to be complete. If the City Engineerdeterminesthat the Improvementshavebeencompletedin accordancewith thisAgreementandin compliancewith theImprovementPlansandall applicable Citystandards, thentheCityEngineershallcertifyto theCityCouncilthecompletionof such Improvements. The Developer shall bear all costsof inspection and certification for completeness in accordancewith theCity's formally adoptedfeesandrates.

C. Acceptance of the Improvements by the City Council shall be made upon recommendationandcertificationof theCity Engineerfollowing inspectionof saidImprovements pursuant to SubsectionB above. The City Council shall act upon the City Engineer's recommendationwithinforty-five (45) daysfollowingcertificationbytheCityEngineerthatsuch Improvementshave beencompleted. Acceptanceby the City Council shall not constitutea waiver by theCity of anydefectsin theImprovements.

3. GUARANTEE AND WARRANTY OF THE IMPROVEMENTS
A. Within the period commencingon the date the first portion of the 11026- 0001\ 2910473v1. doc
Improvementsis acceptedby theCityuntil one (1) yearfollowingacceptanceby theCity of the lastof theImprovements, if anyImprovementsorpartof anyImprovementsfurnished, installed, orconstructedbytheDeveloper, anyof thematerialscomprisingtheImprovements, oranyof the workperformedunderthisAgreement, failstocomplywithanyrequirementsofthisAgreement or the Improvement Plans, the Developer shall, without delay and without cost to the City, repair, replace, orreconstructanydefectiveorotherwiseunsatisfactorypartorpartsoftheImprovements.

ThisguaranteeandwarrantyonbehalfoftheDevelopershallbeseparatefromandin additionto theimprovementsecuritydescribedin Section4(A)(3) of thisAgreement.

B. ShouldtheDeveloperfail or refuseto actpromptly or in accordancewith SubsectionA above, or should the exigencies of the situation require repair, replacement, or reconstruction to be undertaken before the Developer can be notified and can perform the necessarywork, thentheCity may, in its discretion, makethenecessaryrepairsorreplacementsor performthenecessaryreconstruction. TheCityshallprovideabill totheDeveloperof thetotal costs of such repair, replacement, or reconstruction, and the Developer shall immediately reimbursetheCityforthosetotalcosts. If theDeveloperdoesnotimmediatelypaythetotalcosts incurred, theCity mayoptto tenderon theDeveloper'simprovementsecurity.

4. IMPROVEMENT SECURITY
A. Priorto theCity'sexecutionof thisAgreement, theDevelopershallprovide all three of the following as security to the City:

1. For Performance: Security in an amountequalto one hundred percent (100%) of the EstimatedTotal Costs, assetforth in the ReferenceData. With this security, theDeveloperassuresfaithfulperformanceunderthisAgreement, asdemonstratedby theCity's acceptance, in accordancewith the Resolution of Approval and Improvement Plans.

2. ForPa ment: Securityin anamountequalto fifty percent (50%) of the Estimated Total Costs, as set forth in the Reference Data. With this security, the Developer guaranteespaymentto all contractors, subcontractors, laborers, materialsuppliers, andother personsemployedin theperformanceofthisAgreementandreferredtoin Part6 (commencing with Section 8000) of Division 4 of the Civil Code.

3. For Warranty: Securityin an amountequalto twenty-five percent 25%) of the EstimatedTotalCosts, assetforth in the ReferenceData, mustbe providedbefore final completionand the acceptanceof any categoryof Improvementsby the City. With this security, theDeveloperguaranteestheImprovementsforone (1) yearafterthecompletionand acceptanceof the last of such Improvements, against any defective workmanship or materials or anyunsatisfactoryperformance, pursuantto Section3 of thisAgreement.

B. All improvement securities shall be from a California admitted surety insurer or insurers and shall be on forms that are approved by the City Attorney.

C. If theimprovementsecurityis asuretybondand, in theopinionof theCity, anysuretyor suretiesthereonbecomeinsolventor liquidated, or anysuretybondcannotbe tendereduponforthefull penalsumforanyreason, theDevelopershallreneworreplaceanysuch suretybondwithavalidsuretybondfromasolventsuretyorsuretiesin theamountof thefull 11026- 0001\ 2910473v1. doc 4
penalsumwithinten (10) daysafterreceivingfromtheCitywrittendemandtherefor.

D. Improvementsecurity shall be kept on file with the City Engineer. If a suretybondis replacedby anotherapprovedbond, theDevelopershallsubmitthereplacement bondto theCity Engineerand, uponacceptanceby theCityAttorney, theimprovementsecurity shallbedeemedtohavebeenmadeapartof andincorporatedintothisAgreement. Uponapproval bytheCityAttorneyofareplacementbond, theformerimprovementsecurityshallbereleased.

E. Modifications of the Improvement Plans and the Improvements not exceedingten percent (10%) of the original Estimated Total Costs shall not relieve or release any improvementsecurity furnishedby the Developerpursuantto this Agreement. If any such modifications exceedten percent (10%) of the Estimated Total Costs, the Developer shall furnish additionalimprovementsecurityfor performanceandpayment, asrequiredby SubsectionA above, for onehundred percent (100%) of the revised Estimated Total Costs. Alternatively, the Developer mayprovideofficialnoticefromthesuretycompanythatit acknowledgesreceiptofthemodified ImprovementPlansandthattheexistingbondshavebeenamendedto reflectthenewpenalsum, whichshallbein theamountof therevisedEstimatedTotalCosts, andthattheexistingbondsshall thereforeapplyto warranttheProjectasrevised.

F. All Improvements shall be completed within the Completion Period listed in theReferenceData. If theDeveloperhasnotcompletedtheImprovementswithin this specified time, theDevelopershallbe in default. Alternatively, in theeventof a defaultby the Developer pursuantto Section9, andafterwrittennoticetotheDeveloperandreasonableopportunitytocure, theCity, atits soleoption, shallhavetheright, withoutlimitinganyotherrightsandremedies availabletotheCityatlaworin equity, todrawuponorutilizetheimprovementsecurityfurnished herewith to construct and install the Improvements itself.

5. REDUCTION OR RELEASE OF IMPROVEMENT SECURITY
A. Partial releasesor reductions in the Developer' s performance improvement securitymaybeauthorizedpriortotheCity'sacceptanceofallImprovementsrequiredunderthis Agreement, asprovidedin this Section5.

B. Upon written request of the Developer, the City may reduce the improvementsecurityfor performanceby up to thirty percent (30%) of the penal sum if: 1) the Developerhas completeda portionof the Improvements, andthe City has acceptedthose Improvements; 2) theremainingimprovementsecurityfor performanceis in anamountthatcovers theremainingImprovementstobeinstalled; and3) theDeveloperhassubmitted, andtheCityhas approved, thefull improvementsecurityfor warranty. Theimprovementsecurityfor paymentand warrantyshallnotbereduced.

6. INDEMNIFICATION OF THE CITY BY THE DEVELOPER
A. Neither the City, nor its officers, officials, employees, agents, representatives, and volunteers ( collectively, " City Personnel") shall be liable or responsible for anyaccident, injury, loss, ordamagetoeitherpropertyorpersonattributabletoorarisingoutof theconstruction, installation, or maintenanceof the Improvementsby theDeveloper, its officers, employees, and agents. TheDevelopershall defend, indemnify, andhold harmlesstheCity and 11026- 000 1\2910473v Ldoc 5
City Personnelfromandagainstanyandall losses, claims, costs, expenses, liabilities, damages, actions, causesof action, andjudgments, includingattorneys' fees, arisingdirectlyor indirectly out of or attributable to the Developer' s acts or failure to act.

B. The Developer' s obligations under this Section 6 are not conditioned or dependentupon whether the City or City Personnelprepared, supplied, or reviewed any Improvement Plansin connection with the Project or the Improvements, or has insuranceor other indemnification covering any of thesematters.

C. The Developer' s obligation to defend, indemnify, and hold harmless the Cityshallextendtoinjuriestopersonsanddamagestoorallegedtakingofpropertyresultingfrom the design or construction of the Project, and the Improvements required under this Agreement.

Exceptfor aCityDirectiveasdefinedbelow, theCity'sacceptanceof theImprovementsshallnot constituteanassumptionby theCity of anyresponsibilityorliability for anydamageor alleged takingofpropertyreferencedunderthisAgreement. TheCityshallnotberesponsibleorliablefor thedesignor constructionof theProjector theImprovementsconstructedor installedpursuantto the approved Improvement Plans, regardlessof any act or omission by the City in approving the ImprovementPlans, unlesstheparticularImprovementdesignwasrequiredby theCity overthe written objectionof the Developer, which objection statedthat the Improvementdesignwas potentiallydangerousor defectiveandsetforthanalternativedesign (a "City Directive"). After
theCity's acceptanceof theImprovements, theDevelopershallremainobligatedto corrector eliminate all dangerousconditions createdby defects in design or construction (other than those required by a City Directive); provided, however, thattheDevelopershallnotberesponsiblefor routinemaintenance. TheDeveloper'sindemnityobligationsunderthis Section6 shallremainin effectfortwo (2) yearsfollowingacceptanceofthelastoftheImprovement(s) bytheCityCouncil.

TheDeveloperacknowledgesandagreesthattheDevelopershallberesponsibleandliablefor the design and construction of the Improvements and other work done pursuant to this Agreement, unlessthesameis dueto a City Directive. The City shallnotbe liable for anyactsor omissions in approving, reviewing, checking, correcting, or modifyingany ImprovementPlans, or in inspecting, reviewing, or approvinganywork or constructionof Improvements, unlessthesame isduetoaCityDirective. TheDeveloper'simprovementsecurityshallnotberequiredtosecure the Developer' s obligations under this SubsectionC beyond the warranty period listed in Section 4( A)( 3).

D. TheDevelopershallpayandsatisfyanyjudgment, awardor decreethatmay berenderedagainsttheCityandCityPersonneltotheextentof theindemnityprovidedabovein anysuchsuit, action, or otherlegalproceeding, providedtheCity givestheDeveloperprompt written notice of such claim.

E. The Developer' s obligation to indemnify shall not be restricted to Insurance proceeds, if any, receivedbytheCityandCityPersonnel.

F. TheDeveloper, onbehalfof itself andall partiesclaimingunderorthrough it, herebywaivesallrightsofsubrogationandcontributionagainsttheCityandCityPersonnelto the extent of the indemnity aboveprovided.
11026- 0001 \ 2910473v 1doc 6

7. INSURANCE Developer shall at all times during the term of this Agreement, carry andmaintaintheinsurancepoliciessetforthbelow. Thisrequirementmayjh j_ o Set f' 14 belowSeet o 7 will besatisfiedby theinsurancethatDeveloperwill carryandmaintainin connectionwith sa4isfiedby the temporarytraffic control plan encroachmentpermit ("Traffic Control") required by the January 2 - 2d- 2024 City Council approved revision to Engineering Condition of Approval # 11 ( DRA 20- 006). In the event the R ODeveloper does not maintain the " Traffic Control" encroachment permit and required insurancethenREX ODevelopermustprovidetherequiredinsuranceasdetailedbelowin this Agreement.

A. GeneralLiability. TheDevelopershallatall timesduringthetermof this Agreement (aslisted in Section13) carry, maintain, andkeepin full force andeffectapolicy or policiesof comprehensivegeneralliability insurancewith limits of OneMillion Dollars 1, 000, 000) for each occurrence and Two Million Dollars ($ 2, 000, 000) in the aggregate, combinedsinglelimit, againstbodily injury (includingdeath), or lossor damageto propertyto the extentresultingfromthewrongfulornegligentactsoromissionsof theDeveloper, itsofficers, employees, and agents, and shall require such coverage of its independent contractors. If such insurancecontainsageneralaggregatelimit, eitherthegeneralaggregateshallapplyseparatelyto this Project, or thegeneralaggregatelimit shallbe three (3) timestheoccurrencelimit.

The
Developershall havethe right to provide suchinsuranceunderits existing insuranceprogram, providedsuchexistinginsurancemeetsalloftherequirementsofthisSubsectionA.

B. AutomobileLiability (includingowned, non -owned, andhiredautos). The Developershallatall timesduringthetermof thisAgreement (aslistedin Section13) alsocarry, maintain, andkeepin fullforceandeffectapolicyorpoliciesofcommercialautomobileliability insurance with a combined single limit of One Million Dollars ($ 1, 000, 000), single limit, per occurrencefor bodilyinjuryandpropertydamage, whichwill coverthedriversandautomobiles usedto performservicespursuantto thisAgreement. Such insurance shall include coverage for owned, non - owned, and hired automobiles. The Developer shall have the right to provide such insuranceunderitsexistinginsuranceprogram, providedsuchexistinginsurancemeetsallofthe requirements of this Subsection B.

C. Workers' Compensation. The Developer shall at all times during the term of thisAgreement (aslistedin Section13) provideWorkers' CompensationInsurance, including employer'sliabilitycoverage, fortheprotectionoftheDeveloper'semployees, withaminimum limit of One Million Dollars ($ 1,000,000) or the amount required by law, whichever is greater.

D. TheDeveloperagreesthatif it doesnotkeeptheaforesaidinsurancein full forceandeffecttheCity mayeither, afterwrittennoticeto theDeveloperandfailureby the Developerto curesamewithin ten (10) days, immediatelyterminatethisAgreementfor defaultby the Developer, or, if insuranceis available at reasonablecost, the City may take out the necessary insuranceandpay, attheDeveloper'sexpense, thepremiumamount. 11026- 0001\ 2910473v1. doc 7
E. Thegeneralliability policy andautomobileliability policyshalleachbe endorsedto statethattheCityandCityPersonnel, asthattermis definedabove, shallbecovered asadditional insuredsto the extent of the indemnity in Section 6.

F. Theinsuranceprovidedby theDevelopershallbeprimaryto anycoverage availableto theCityor CityPersonnelandshallprovidethatanyinsuranceor self-insurance maintainedbytheCityorCityPersonnelshallbeinexcessoftheDeveloper'sinsuranceandshall not contribute with it.

G. Theinsuranceprovidedby theDevelopershallbeendorsedto statethatthe insurershallwaiveall rightsof subrogationagainsttheCity andCityPersonnel, to theextentof the Indemnity in Section 6.

H. ThepolicyorpoliciesrequiredunderthisAgreementshallbeissuedbyan insurer admitted in the Stateof California with a rating of at least B+:VII in the latest edition of A. M. Best' s insurance guide.

I. Thecertificatesandendorsementsfor eachinsurancepolicy shallbesigned byapersonauthorizedbythatinsurerorabrokertobindcoverageonitsbehalf. Thecertificates shallalsospecificallystatethatthecoveragecontainedin thosepoliciesaffordsinsurancein compliance with the terms and conditions as set forth in this Agreement.

J. Deductibles. Any deductiblesor self -insuredretentionsof anycontractors or subcontractorsmust be declaredto and approvedby the City prior to the executionof this Agreement by the City. At the option of the City, either the contractor' s or subcontractor' s insurer(s) shallreduceor eliminatethedeductiblesor self -insuredretentionsregardingtheCity, or thecontractororsubcontractorshallprocureabondguaranteeingpaymentoflossesandexpenses.

K. Notice of Policy Changes. Coverage shall not be suspended, voided, cancelled, reducedin coverageor in limits, non -renewed, or materially changedfor anyreason, withoutthirty (30) days' priorwrittennoticethereofgivenbytheDevelopertotheCity.

M. Nothingcontainedin thisSection7 shallbeconstruedaslimitingin any waytheDeveloper'sobligationsofindemnificationunderSection6oranyotherextenttowhich theDevelopermaybeheld responsiblefor paymentof damagesto personsor propertyresulting fromitsoperations, includingoperationsandworkperformedormaterialssuppliedbyoronbehalf oftheDeveloper, anycontractorsorsubcontractors, orbyanyonedirectlyorindirectlyemployed by any of them.
11026- 0001\ 2910473v1. doc 8
N. Theabovecoverageswill beprovidedby theDeveloperandmaintainedon behalfof theCity andin accordancewith therequirementssetforthin thisAgreement. If the Developerperformsconstructionactivitiesthrougha generalcontractoror subcontractors, some oralloftheseinsurancerequirementsfortheperiodof constructionmaybesatisfiedbythegeneral contractor's or subcontractors' insurancecoverages; provided, however, thattheDevelopershall firstprovideawrittenplanfortheapprovaloftheCitywhichsetsforththerespectiveobligations and deadlinesof the Developer and its contractor and subcontractors.

8. OWNERSHIP OF THE IMPROVEMENTS
A. Ownershipof all or anycategoryof theImprovementsconstructedand installedbytheDeveloperpursuanttothisAgreementtobededicatedshallvest, asapplicable, in theCity (orotherspecifiedgovermnentalagency) uponacceptanceofsaidImprovementsbythe City Councilandrecordationof aNoticeof Completion.

B. TheDevelopershallatall timesprior totheacceptanceof theImprovements bytheCity, givegoodandadequatewarningtothepublicof eachandeverydangerousand defectiveconditioncausedby the constructionof the Improvementsandshalltakeall steps necessarytoprotectthepublicfromsuchdangerousordefectiveconditions. TheDeveloperagrees andunderstandsthat until acceptanceof the Improvementsby the City, eachImprovementand Improvementareathatis offeredfor dedicationshallbeunderthechargeof theDeveloper, andthe Developermaycloseall or aportionof anystreetor areawhenevernecessaryto protectthepublic duringtheconstructionof theImprovements.

9. DEFAULT AND BREACH BY THE DEVELOPER AND REMEDIES OF THE CITY
A. Upontheoccurrenceof anyof thefollowing events, theDevelopershallbe deemed to be in default under this Agreement:

I. Failure to complete construction and installation of the ImprovementsoranyofthembytheCompletionDatesetforthin theReferenceData;

2. Failureto promptlycorrector cureanydefectin theImprovements oranyofthem (otherthanaCityDirective) duringtheguaranteeandwarrantyperiodrequiredby Section3(A) or failureto commencecorrectionor cureof anysuchdefector failure to diligently prosecutesametocompletion, in eachinstancefollowingwrittennoticethatsuchdefectexists;

3. Failureto performsubstantialwork ontheImprovementsoron any of them, aftercommencementof work onsame, for aperiodof thirty (30) daysafterwrittennotice thereof from the City;

4. Insolvency, appointmentof areceiver, orthefiling of anypetitionin bankruptcy, whethervoluntaryorinvoluntary, andsuchisnotcuredordischargedwithinaperiod of thirty ( 30) days;

5. Commencement of a foreclosure action against the Project or any portionthereof, oranyconveyancebytheDeveloperinlieuorinavoidanceofforeclosure, within 11026- 0001\ 2910473v1. doc 9
thirty (30) daysof writtennoticethereoffrom the City; or

6. Failureto performanyotherobligationsin accordancewith the termsandprovisionsofthisAgreementwithinthetimeperiodspecifiedinthisAgreementforthe performanceofthatobligation, orif notimeisspecified, withinthirty (30) daysofwrittennotice thereof from the City.

B. TheCityreservesto itselfall remediesavailableto it atlawandin equity foranybreachoftheDeveloper'sobligationsunderthisAgreement. TheCityshallhavetheright, without limitation of other rights or remedies, after written notice to the Developer and a reasonableopportunityfortheDeveloperto cureanysuchallegeddefault, to drawuponorutilize any improvementsecurityfurnishedhereunderto completethe Improvementsor otherwise mitigatetheCity's damagesin theeventof theDeveloper'sdefault.

C. Followingthewrittennoticeof allegeddefaultandfailurebytheDeveloper topromptlycommencethecureof anyallegeddefaultandto diligentlyprosecutesuchcureto completionwithin thetime periodsetforth in Section9(A)(6), the City may tender to the surety onthesuretybondfurnishedasimprovementsecurityfor performance, andrequestappropriate fundsorthatsaidsuretytakeoverandcompletetheImprovementsspecifiedunderthisAgreement.

D. The Developer acknowledges that the Estimated Total Costs and improvementsecurityamountssetforthunderthisAgreementmaynotreflecttheactualcostof constructionor installationof the Improvements, andconsequently, the City's damagesfor the Developer'sdefaultshallbemeasuredby theactualcostof completingtherequiredImprovements.

E. Following thewrittennoticeof allegeddefaultandfailureby theDeveloper topromptlycommencethecureof anyallegeddefaultandto diligentlyprosecutesuchcureto completionwithin thetimeperiodsetforth in Section9 (A)(6), the City may, without liability for sodoing, takepossessionof, andutilizein completingthe Improvements, suchmaterials, appliances, plantandotherpropertybelongingtotheDeveloperasmaybeonthesiteofthework andnecessaryfortheperformanceofthework. TheDeveloperherebyconsentstosuchentryby theCity andits representatives, includingemployees, agents, andcontractors, uponanyreal propertyintheProjectownedbytheDeveloper, intheeventtheCityelectstomaintainorcomplete the work on the Improvements following the Developer' s default.

F. TheCity'sfailuretotakeanenforcementactionwithrespecttoadefault, or to declarea defaultor breach, shallnot be construedasa waiver of that defaultor breachor any subsequent default or breach of the Developer.

G. If anylegalactionor otherproceeding, includingactionfor declaratory relief, is broughtfor the enforcementof thisAgreementor becauseof anallegeddispute, breach, default, or misrepresentationin connectionwith this Agreement, the prevailing party shall be entitled to recoverreasonableattorneys' fees, experts' fees, andother costs, in addition to anyother relief to which thepartymaybeentitled.

10. RELATIONSHIP OF THE PARTIES
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Neither the Developer, nor any of the Developer' s contractors, subcontractors, employees or agents, areor shallbe deemedto be, agentsof the City in connectionwith theperformanceof theDeveloper'sobligationsunderthisAgreement. TheDevelopershallnot, at anytime or in any manner, representor allow representationby its contractors, subcontractors, employees, or agents thatanyof themarecontractors, subcontractors, employees, oragentsof theCity.

11. ASSIGNMENT
A. The Developer shall not assign this Agreement or any portion thereof withoutthepriorwrittenconsentof theCity, whichconsentshallnotbeunreasonablywithheld.

AnyattemptedorpurportedassignmentinviolationofthisSubsectionA shallbenullandvoid and shall have no force or effect.

B. The sale or other disposition of the Project shall not relieve the Developer of its obligations under this Agreement. If the Developer intends to sell the Project or any portion thereoftoanyotherpersonorentity, theDevelopermayrequestanovationofthisAgreementand asubstitutionof improvementsecurity. UpontheCity'sapprovalof thenovationandsubstitution of improvementsecurity, theDevelopermayrequestareleaseor reductionof theimprovement security furnished pursuant to this Agreement.

12. NOTICES
All noticesrequiredorprovidedforin thisAgreementshallbein writinganddeliveredin personorbymail, postageprepaid, andaddressedasfollows:

If to the City: Carlos Zamano
Public Works Director/ City Engineer
City of Highland
27215 Base Line
Highland, California 92546
If to the Developer: To the address set forth above in the Reference Data, or to such other address as may subsequently
be designated in written notice to the City.

Noticeshallbeeffectiveonthedatethatit is deliveredin person, or if mailed, three (3) daysafter the date of deposit in the United States Mail.

13. TERM
Thetermof thisAgreementshallcommenceon theEffectiveDateof Agreementaslisted in the ReferenceDateandshall continueuntil the endof the guaranteeandwarrantyperiodin Section3(A) andwarrantyperiodin Section4(A)(3), unlessanyclaimsfiled duringthattimehave not beensettled, in which casetheterm of this Agreementshall extenduntil thoseclaimshave been settled.

14. ENTIRE AGREEMENT
11026- 0001\ 2910473v 1.doc I 1
ThisAgreementconstitutestheentireagreementof thepartieswith respectto its subject matter. All modifications, amendments, or waiversof any termsof this Agreementshall be in writing andsignedby the duly authorizedrepresentativesof theparties. In the case of the City, thedulyauthorizedrepresentative, unlessotherwisespecifiedunderthisAgreement, shallbethe City Engineer.

15. SEVERABILITY
The provisions of this Agreement are severable. If anyportion of thisAgreementis held invalidbyacourtof competentjurisdiction, theremainderofthisAgreementshallremainin full force and effect.

16. INCORPORATION OF REFERENCE DATA AND RECITALS
The Reference Data and the Recitals are incorporated into this Agreement.

17. GOVERNING LAW; VENUE
This Agreementshall be governedby the laws of the Stateof California, excluding California' s choice of law rules. Venuefor anyactionrelatingto this Agreementshallbe in the San Bernardino County Superior Court.

18. CONSTRUCTION
In theeventof anyassertedambiguityin, or disputeregardingtheinterpretationof any matterunderthis Agreement, the interpretationof this Agreementshall not be resolvedby any rulesof interpretationproviding for interpretationagainstthepartywho causestheuncertaintyto existoragainstthepartywhodraftedthisAgreementorwhodraftedthatportionofthisAgreement.

19. EFFECTIVE DATE OF THIS AGREEMENT
ThisAgreementshallbe andbecomeeffectiveasof thedatethatit is executedby a duly authorizedofficer or employeeof theCity, it beingthe intentionof thepartiesthattheDeveloper shallfirst executethis Agreementandthereaftersubmitit to the City. The City shall insertthe effectivedatein theReferenceDatain all counterpartsof thisAgreementandshalltransmitafully executed counterpart to the Developer.

SIGNATURES BEGIN ON NEXT PAGE —
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IN WITNESSWHEREOF, thepartiesheretohavecausedthisAgreementto beexecuted by theirrespectiveofficers, thereuntodulyauthorized, asof thedatessetforthbelowtheir respective signatures.

Note: All signatures must be acknowledged by a
notarypublic andtheacknowledgementmustbe
attached. If signed by a corporation, the signatures
of two corporate officers are required, unless a
resolution of the corporation' s board of directors is
providedindicatingthatthesignatureof theone
signatory is sufficient to bind the corporation.]
DEVELOPER"
Type or print exact nameof person or
entity)
By:

Signature of authorized officer)
Typeor print nameof authorizedofficer)
Chairperson President Vice
President
By:

Signature of authorized officer)
Typeor print nameof authorizedofficer)
Secretary Asst. Secretary
Chief Finance Officer Asst. Treasurer
Date:

SIGNATURES CONTINUE ON NEXT PAGE —
11026- 0001\ 2910473v1. doc 13
CITY"

CITY OF HIGHLAND
Penny Lilburn, Mayor
ATTEST:

SEAL)
Betty Hughes, City Clerk
APPROVED AS TO FORM:

Richards, Watson & Gershon
Maricela Marroquin, City Attorney
H 026- 0001 \ 2910473v Ldoc 14
NotaryPublicorotherofficercompletingthiscertificateverifiesonlytheidentityof the individual who signedthe 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)
Notary Public, personallyappeared
whoprovedtomeonthebasisofsatisfactoryevidencetobetheperson(s) whosename(s) is/are subscribedto thewithin instrumentandacknowledgedto methathe/she/theyexecutedthesame in his/ her/ their authorized capacity( ies), andthatby his/her/their signature(s) ontheinstrument the person( s), ortheentityuponbehalfof whichtheperson(s) acted, executedtheinstrument.

I certifyunderPENALTYOFPERJURYunderthelawsof theStateof Californiathat theforegoingparagraphis trueandcorrect.

WITNESS my hand and official seal.

Signature Seal)
11026- 000 1\2910473v l . doc 15
NotaryPublicorotherofficercompletingthiscertificateverifiesonlytheidentityofthe individual who signedthe 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)
NotaryPublic, personallyappeared
whoprovedtomeonthebasisofsatisfactoryevidencetobetheperson(s) whosename(s) is/are subscribedto thewithin instrumentandacknowledgedto methathe/she/theyexecutedthesame in his/ her/their authorized capacity( ies), andthatby his/her/their signature(s) ontheinstrument the person( s), ortheentityuponbehalfof whichtheperson(s) acted, executedtheinstrument.

I certifyunderPENALTYOFPERJURYunderthelawsof theStateof Californiathat theforegoingparagraphis trueandcorrect.

WITNESS my hand and official seal.

Signature, Seal)
11026-0001\2910473v1.doc 16
Bond No.

FAITHFUL PERFORMANCE BOND
KNOW ALL PERSONS BY THESE PRESENTS that:

Whereas, theCity of Highland, Stateof California, andSanCarloApartmentHomesLLC hereinafter designated as " Principal") have enteredinto an agreementwhereby Principal agrees to installandcompletecertaindesignatedpublicimprovements, whichsaidagreement, dated February13, 2024, pertainingto theSanCarloI, HighlandTownhomeApartmentsis hereby referred to and made a part hereof; and
Whereas, Principalis requiredunderthetermsof saidagreementto furnishabondfor thefaithful performanceof saidagreement.

Now, therefore, we, the Principal and as surety ( hereinafter designated as " Surety"), areheldandfirmly bounduntotheCityof Highlandin thepenalsumof dollars ($ ) lawful money of the United States, for the paymentof whichsumwell andtrulyto bemade, webindourselves, ourheirs, successors, executorsandadministrators, jointly andseverally, firmly by thesepresents.

Theconditionof this obligationis suchthatif theaboveboundedPrincipal, his, her, or its heirs, executors, administrators, successorsor assigns, shallin all thingsstandto andabideby, andwell andtrulykeepandperformthecovenants, conditionsandprovisionsinthesaidagreementandany alterationthereofmadeasthereinprovided, onhis, her, itsortheirpart, tobekeptandperformed atthetimeandinthemannerthereinspecified, andin allrespectsaccordingtotheirtrueintentand meaning, andshallindemnifyandsaveharmlesstheCityof Highland, itsofficers, agentsand employees, asthereinstipulated, thenthisobligationshallbecomenullandvoid; otherwiseit shall be and remain in full force and effect.

Asapartoftheobligationsecuredherebyandinadditiontothefaceamountspecifiedtherefor, there shall be included costs and reasonableexpensesand fees, including reasonableattorneys' fees, incurredbytheCityofHighlandinsuccessfullyenforcingsuchobligation, alltobetaxedas costsand included in anyjudgment rendered.

Further, Suretyherebywaivestheprovisionsof CaliforniaCivil CodeSections2845and2849.

TheCityofHighlandistheprincipalbeneficiaryofthisbondandhasallrightsofapartyhereto.

IN WITNESSWHEREOF, two (2) identicalcounterpartsof this instrument, eachof which shall forallpurposesbedeemedanoriginalhereof, havebeendulyexecutedbyPrincipalandSurety, on the dateset forth below, the nameof eachcorporateparty being heretoaffixed andthese 11026- 000 1\ 2910473v Ldoc
presentsdulysignedbyitsundersignedrepresentative(s) pursuantto authorityof itsgoverning body.

Dated:

Principal"
By:

Its:

By:

Its:

Seal)
Note: This bond must be executed in duplicate and dated, all signatures must be notarized, and evidence of the
authorityof anypersonsigningas attorney -in -fact
must be attached.

Surety"
By:

Its:

By:

Its:

Seal)
APPROVED AS TO FORM:

RICHARDS, WATSON & GERSHON
A Professional Corporation
By:

City Attorney
11026- 0001 \ 2910473v ] . doc
Bond No.

PAYMENT BOND
KNOW ALL PERSONS BY THESE PRESENTS that:

Whereas, the City of Highland, Stateof California, andSanCarloApartmentHomesLLC hereinafter designated as " Principal") have entered into an agreement whereby the Principal agreesto install andcompletecertaindesignatedpublic improvements, which agreement, dated February13, 2024, pertainingto theSanCarloI, HighlandTownhomeApartments, is hereby referred to andmade a part hereof, and
Whereas, under the terms of the agreement, the Principal is required before entering upon the performanceofthework, tofileagoodandsufficientpaymentbondwiththeCityofHighlandto securetheclaimstowhichreferenceismadein Part6 (commencingwith Section8000) of Division 4 of the Civil Code.

Now, therefore, the Principal and , as surety (hereinafter designated as " Surety"), areheldfirmly bounduntotheCityof Highlandandall contractors, subcontractors, laborers, materialsuppliers, andotherpersonsemployedin theperformanceof theagreementand referredto in Part6 (commencingwith Section8000) of Division4of theCivil Codein thepenal sum of dollars ($ ), for materials furnished or labor thereon of anykind, orforamountsdueundertheUnemploymentInsuranceActwithrespecttothisworkor labor, thattheSuretywill paythesamein anamountnotexceedingtheamounthereinaboveset forth, and alsoin casesuit is broughtuponthis bond, will pay, in additionto the faceamount thereof, costsandreasonableexpensesandfees, includingreasonableattorneys' fees, incurredby theCityofHighlandinsuccessfullyenforcingthisobligation, tobeawardedandfixedbythecourt, andto betaxedascostsandto beincludedin thejudgmentthereinrendered.

It isherebyexpresslystipulatedandagreedthatthisbondshallinuretothebenefitofanyandall persons, companies, andcorporationsentitledtofile claimsunderPart6 (commencingwith Section8000) of Division 4 of theCivil Code, soasto givearight of actiontothemortheirassigns in anysuitbroughtuponthisbond.

Shouldtheconditionof thisbondbefully performed, thenthisobligationshallbecomenull and void, otherwise it shall be and remain in full force and effect.

Further, Suretyherebywaivestheprovisionsof CaliforniaCivilCodeSections2845and2849.

TheCityofHighlandistheprincipalbeneficiaryofthisbondandhasallrightsofapartyhereto.

TheSuretyherebystipulatesandagreesthatnochange, extensionof time, alteration, oraddition to thetermsof the agreementor the specificationsaccompanyingthe sameshallin anymanner affectits obligationsonthisbond, andit doesherebywaivenoticeof anysuchchange, extension, alteration, or addition.

IN WITNESSWHEREOF, two (2) identicalcounterpartsof this instrument, eachof whichshall forallpurposesbedeemedanoriginalhereof, havebeendulyexecutedbyPrincipalandSurety, on the date set forth below, the nameof eachcorporateparty being heretoaffixed andthese 11026- 0001\ 2910473v1. doc
presentsdulysignedby itsundersignedrepresentative(s) pursuantto authorityof itsgoverning body.

Dated:

Principal"
By:

Its:

By:

Its:

Seal)
Note: This bond must be executed in duplicate and dated, all signatures must be notarized, and evidenceof the
authority of any person signing as attorney -in -fact
must be attached.

Surety"
By:

Its:

By:

Its:

Seal)
APPROVED AS TO FORM:

RICHARDS, WATSON & GERSHON
A Professional Corporation
By:

City Attorney
11026- 0001\ 2910473v1. doc
Bond No.

WARRANTY BOND
KNOW ALL PERSONS BY THESE PRESENTS that:

Whereas, the City of Highland, Stateof California, andSanCarloApartmentHomesLLC hereinafter designated as " Principal") have entered into an agreement, dated _ February 13, 2024, pertainingtotheSanCarloI, HighlandTownhomeApartments, isherebyreferredtoandmadea part hereof, and
Whereas, Principalis requiredunderthetermsof saidagreementto furnishabondfor the good andsufficientwarrantyof all of theimprovementsinstalledpursuantto saidagreement.

Now, therefore, we, the Principal and , as surety ( hereinafter designated as " Surety"), areheldandfirmlybounduntotheCityof Highlandin thepenalsumof dollars ($ ) lawful moneyof the United States, for the
paymentof whichsumwell andtrulyto bemade, webindourselves, ourheirs, successors, executorsandadministrators, jointly andseverally, firmly by thesepresents.

Theconditionof this obligationis suchthat, if theherebyboundedPrincipal, his, heror its heirs, executors, administrators, successors or assigns, shall remedy, without cost to the City of Highland, anydefectswhichmaydevelopduringaperiodof one (1) yearfromthedateof the completionandacceptanceof thelastof theimprovementsinstalledundertheagreement, caused bydefectiveorinferiormaterialsorworkmanshipasdeterminedbytheCity, andshallindemnify, defendandholdharmlesstheCityof Highland, itsofficers, agents, andemployeesforanyandall claims, demands, causes of action, damages, injuries, liabilities, losses, costs or expenses, includingattorneys' feesandcostsof defense, whichariseoutof, pertainto, orrelateto such defectsor inferiormaterialsor workmanshiporto thePrincipal'sactionsorinactionsin remedying suchdefectsor inferior materialsor workmanship, thenthis obligationshallbecomenull andvoid; otherwise it shall be and remain in full force and effect.

If suit is broughtuponthis bond, Suretyfurtheragreesto pay, in additionto the PenalSum, all costsandreasonableexpensesandfees, includingreasonableattorneys' fees, incurredby theCity ofHighlandin successfullyenforcingsuchobligation, all tobetaxedascostsandincludedin any judgment rendered.

Further, Suretyherebywaivestheprovisionsof CaliforniaCivil CodeSections2845and2849.

TheCityofHighlandistheprincipalbeneficiaryofthisbondandhasallrightsofapartyhereto.

TheSuretyherebystipulatesandagreesthatnochange, extensionoftime, alterationoradditionto the terms of the agreement or to the work to be performed thereunder or the specifications accompanyingthesameshallin anywiseaffectits obligationsonthisbond, andit doeshereby waivenoticeof anysuchchange, extensionof time, alterationor additionto thetermsof the agreement or to the work or to the specifications.
11026-0001\2910473vLdoc
IN WITNESSWHEREOF, two (2) identicalcounterpartsof this instrument, eachof which shall forallpurposesbedeemedanoriginalhereof, havebeendulyexecutedbyPrincipalandSurety, on the date set forth below, the nameof eachcorporateparty being heretoaffixed and these presentsdulysignedby itsundersignedrepresentative(s) pursuanttoauthorityof its governing body.

Dated:

Principal"
By:

Its:

By:

Its:

Seal)
Note: This bond must be executed in duplicate and dated, all signatures must be notarized, and evidence of the
authorityof anypersonsigningas attorney -infact
must be attached.

Surety"
By:

Its:

By:

Its:

Seal)
APPROVED AS TO FORM:

RICHARDS, WATSON & GERSHON
A Professional Corporation
By:

City Attorney
11026-0001 \2910473vl . doc
Version 3
Amendments Replacing Unit Hold with 6-Month Deadline

CITY OF HIGHLAND

PROJECT IMPROVEMENT AGREEMENT
REFERENCE DATA* * * * * *
PROJECT NO. DRA 20-006
NAME OF PROJECT (hereinafter "Project"): San Carlo I, Highland Townhome Apartments

NAME AND ADDRESS
OF THE DEVELOPER( S): San Carlo Apartment Homes LLC
2518 North Santiago Blvd.

Orange, California 92867
CITYCOUNCILRESOLUTIONNOs. 2020-049and2024-001 (hereinafter "Resolutionof Approval")
IMPROVEMENT PLANS NO. Traffic SignalCalhounRoadatGreenspotRoad hereinafter " Improvement Plans," which include all Project specifications) IMPROVEMENTS: See Schedule A
ESTIMATED TOTAL COSTSOF IMPROVEMENTS: $ 500, 000
hereinafter " Estimated Total Costs")
FORM OF IMPROVEMENT SECURITY: Surety bonds
NAME AND ADDRESS OF SURETY:

SURETY BOND NUMBERS:

EFFECTIVE DATE OF AGREEMENT
Performance Bond: $ 500, 000
Payment Bond: $ 250, 000
Warranty Bond: $ 125, 000
February 13, 2024
COMPLETIONPERIOD: AllImprovements (asdefinedinRecitalB) oftheProjectshallbe completed prior to
thep rojeetsiteconsistingof at !easteightresidential August 13 2024 unless further extendedasprovided in Recital B of the Agreement.
11026- 0001 \ 2910473 v Ldoc 1
THIS PROJECT IMPROVEMENT AGREEMENT (" Agreement") is made and enteredinto by and betweenthe City of Highland, a municipal corporation (" City"), and the Developer whose name and address is set forth above in the Reference Data.

B. As aconditionprecedentto theapprovalof theProject, theDevelopermustcomply with theResolution of Approval andmust enterinto a securedagreementwith the City to complete the constructionof a traffic signal utilizing a video detectionsystemat the intersectionof Greenspot Road and Access " C" ( CalhounRoad) asper EngineeringConditionof Approval #11 and # 12 ( DRA 20- 006),
1, d other related ; ,... nts (" Improvements"). The Improvements shallbecompletedprior totheissuaneeof aeeAifieatey for- thelastr-esiden albuilding on the Prejee4 site stin, of at least eight ident ^' „ i+^ August 13, 2024. In the event that the Developer has made at least fifes percent 50%) progresstowardsthe constructionof the Improvements asdetermined by the City Engineer, the City Engineer is authorized at the request of theDeveloperto extendthe completionperiodby up to anadditionalsix months. In no event shall the Improvements be constructed later than February 28 2025. Access "C" ( Calhoun Road) is to be constructedto qpproximately325lineal feetnorthof theintersectionof GreenspotRoad and Calhoun Road.

D. Improvement Plans, numbered as designatedabove in the ReferenceData, for the construction, installation and completion of the Improvementshave been preparedby the Developer, approvedby theCity Engineer, andareonfile in theoffice of theCity Engineer.

AGREEMENT
NOW, THEREFORE, in consideration of the approval by the City Council of the Resolution of Approval, the Developer and the City agreeas follows:

1. THE DEVELOPER' S OBLIGATION TO CONSTRUCT IMPROVEMENTS A. The Developer shall, at its sole expense, and in compliance with the ImprovementPlansandall applicableCity standardsandfees, andin a good andworkmanlike fashion, furnish, construct, install and guaranteeandwarranty (as set forth in Section3) the Improvementsmorespecificallydescribedin theCityCouncil'sResolutionofApproval.

B. Developer shall complete all Improvements within the Completion Period 11026- 0001\ 2910473v1. doc 2
specified in the Reference Data.

C. The Developer shall, at its sole expense, replace or repair all public improvementsrelatedto SanCarlo1project, publicproperty, or public utility facilitieswhich are destroyedor damagedas a result of anywork underthis Agreement. Any suchreplacementor repair shall be subject to the approval of the City Engineer.

D. Until the Improvementsareacceptedby the City, the Developershallbe responsiblefor thecareandmaintenanceof suchImprovementsandshallbearall risksof lossor damageto saidImprovements. NeithertheCity, norits officers, agentsnor employeesshallhave anyliabilityforanyaccident, lossordamagetotheImprovementspriortotheircompletionand acceptance by the City.

F. Not less than fifteen ( 15) days prior to commencement of work on the Improvements, theDevelopershallgivewrittennoticetotheCity Engineerof thedatefixedfor suchcommencementof work sothatthe City Engineershallhaveadequatetime to scheduleall necessary inspections.

G. TheDevelopershallpay all City feesandcostsstipulatedin the latestfee resolutionasadoptedbytheCityCouncilfromtimetotimeasrequiredforthedevelopmentofthe Project, whichmayinclude, butisnotlimitedto, buildingpermitfees, gradingpermitfees, plan checkfees, encroachmentpermit fees, andinspectionfees.

2. INSPECTION OF WORK AND FINAL ACCEPTANCE
A. The Developer shall at all times maintain proper facilities and safe access forinspectionof theImprovementsbytheCityEngineerandotherCitypersonnelandinspection consultants.

B. Upon completion of Improvements, the Developer shall request a final inspection by the City Engineer. Within ten ( 10) business days of any inspection of the Improvements, theCityEngineershallprovidewrittennoticetotheDeveloperof thelistofitems which havebeenfound to be incompleteand the list of items which havebeenfound to be complete. If the City Engineerdeterminesthat the Improvementshavebeencompletedin accordancewith thisAgreementandin compliancewith theImprovementPlansandall applicable Citystandards, thentheCityEngineershallcertifytotheCityCouncilthecompletionof such Improvements. The Developer shall bear all costsof inspection and certification for completeness in accordancewith the City' s formally adoptedfees and rates.

C. Acceptance of the Improvements by the City Council shall be made upon recommendationandcertificationof theCity Engineerfollowing inspectionof saidImprovements pursuant to SubsectionB above. The City Council shall act upon the City Engineer's recommendationwithinforty-five (45) daysfollowingcertificationbytheCityEngineerthatsuch Improvementshavebeen completed. Acceptanceby the City Council shall not constitute a waiver 11026- 0001\ 2910473v1. doc 3
by the City of any defectsin the Improvements.

3. GUARANTEE AND WARRANTY OF THE IMPROVEMENTS
A. Within the period commencingon the date the first portion of the Improvementsis acceptedby theCityuntil one (1) yearfollowingacceptanceby theCity of the lastof theImprovements, if anyImprovementsorpartof anyImprovementsfurnished, installed, orconstructedbytheDeveloper, anyofthematerialscomprisingtheImprovements, oranyofthe workperformedunderthisAgreement, failsto complywithanyrequirementsof thisAgreement or the Improvement Plans, the Developer shall, without delay and without cost to the City, repair, replace, orreconstructanydefectiveorotherwiseunsatisfactorypartorpartsof theImprovements.

Thisguaranteeandwarrantyonbehalfof theDevelopershallbeseparatefromandin additionto theimprovementsecuritydescribedin Section4(A)(3) of thisAgreement.

B. Shouldthe Developerfail or refuseto actpromptly or in accordancewith SubsectionA above, or should the exigencies of the situation require repair, replacement, or reconstruction to be undertaken before the Developer can be notified and can perform the necessarywork, thentheCity may, in its discretion, makethenecessaryrepairsorreplacementsor perform the necessary reconstruction. TheCity shallprovidea bill to theDeveloperof the total costs of such repair, replacement, or reconstruction, and the Developer shall immediately reimbursetheCityforthosetotalcosts. If theDeveloperdoesnotimmediatelypaythetotalcosts incurred, theCity mayopt to tenderontheDeveloper'simprovementsecurity.

4. IMPROVEMENT SECURITY
A. Priorto theCity'sexecutionof thisAgreement, theDevelopershallprovide all three of the following as security to the City:

1. For Performance: Security in an amountequal to one hundred percent (100%) of the EstimatedTotal Costs, assetforth in the ReferenceData. With this security, theDeveloperassuresfaithful performanceunderthis Agreement, asdemonstratedby theCity's acceptance, in accordancewith the Resolution of Approval and Improvement Plans.

2. For Payment: Security in an amount equalto fifty percent (50%) of the Estimated Total Costs, as set forth in the Reference Data. With this security, the Developer guaranteespaymentto all contractors, subcontractors, laborers, materialsuppliers, andother personsemployedin theperformanceof thisAgreementandreferredtoin Part6 (commencing with Section 8000) of Division 4 of the Civil Code.

3. For Warranty: Securityin anamountequalto twenty-five percent 25%) of the EstimatedTotalCosts, assetforth in the ReferenceData, mustbe providedbefore final completionandthe acceptanceof any categoryof Improvementsby the City. With this security, theDeveloperguaranteestheImprovementsforone (1) yearafterthecompletionand acceptanceof the last of such Improvements, against any defective workmanship or materials or anyunsatisfactoryperformance, pursuantto Section3of thisAgreement.

B. All improvement securities shall be from a California admitted surety insurer or insurers and shall be on forms that are approvedby the City Attorney. 11026- 0001 \ 2910473v Ldoc 4
C. If theimprovementsecurityis a suretybondand, in theopinionof theCity, anysuretyor suretiesthereonbecomeinsolventor liquidated, or anysuretybondcannotbe tendereduponforthefull penalsumforanyreason, theDevelopershallreneworreplaceanysuch suretybondwithavalidsuretybondfromasolventsuretyorsuretiesin theamountofthefull penalsumwithinten (10) daysafterreceivingfromtheCitywrittendemandtherefor.

D. Improvementsecurityshall be kept on file with the City Engineer. If a suretybondis replacedby anotherapprovedbond, theDevelopershallsubmitthereplacement bondto the City Engineerand, uponacceptanceby theCity Attorney, the improvementsecurity shallbedeemedto havebeenmadeapartof andincorporatedinto thisAgreement. Uponapproval bytheCityAttorneyofareplacementbond, theformerimprovementsecurityshallbereleased.

F. All Improvements shall be completed within the Completion Period listed in theReferenceData. If theDeveloperhasnot completedtheImprovementswithin this specified time, the Developer shall be in default. Alternatively, in the event of a default by the Developer pursuanttoSection9, andafterwrittennoticetotheDeveloperandreasonableopportunitytocure, theCity, at its soleoption, shallhavetheright, withoutlimiting anyotherrightsandremedies availabletotheCityatlaworin equity, todrawuponorutilizetheimprovementsecurityfurnished herewith to construct and install the Improvements itself.

REDUCTION OR RELEASE OF IMPROVEMENT SECURITY
A. Partial releasesor reductions in the Developer' s performance improvement securitymaybeauthorizedpriorto theCity'sacceptanceof all Improvementsrequiredunderthis Agreement, asprovided in this Section 5.

B. Upon written request of the Developer, the City may reduce the improvementsecurityfor performanceby up to thirty percent (30%) of the penal sum if. 1) the Developerhascompleteda portionof the Improvements, andthe City hasacceptedthose Improvements; 2) theremainingimprovementsecurityfor performanceis in anamountthatcovers theremainingImprovementsto beinstalled; and3) theDeveloperhassubmitted, andtheCityhas approved, thefull improvementsecurityfor warranty. Theimprovementsecurityfor paymentand warranty shall not be reduced.

6. INDEMNIFICATION OF THE CITY BY THE DEVELOPER
A. Neither the City, nor its officers, officials, employees, agents, 11026- 0001\ 2910473v1. doc 5
representatives, and volunteers ( collectively, " City Personnel") shall be liable or responsible for anyaccident, injury, loss, ordamagetoeitherpropertyorpersonattributabletoorarisingoutof theconstruction, installation, or maintenanceof the Improvementsby theDeveloper, its officers, employees, and agents. The Developershalldefend, indemnify, andhold harmlessthe City and CityPersonnelfromandagainstanyandalllosses, claims, costs, expenses, liabilities, damages, actions, causesof action, andjudgments, includingattorneys' fees, arisingdirectlyor indirectly out of or attributable to the Developer' s acts or failure to act.

B. The Developer' s obligations under this Section 6 are not conditioned or dependentupon whether the City or City Personnelprepared, supplied, or reviewed any Improvement Plansin connection with the Project or the Improvements, or hasinsuranceor other indemnification covering any of thesematters.

C. The Developer' s obligation to defend, indemnify, and hold harmless the Cityshallextendtoinjuriestopersonsanddamagestoorallegedtakingofpropertyresultingfrom the designor constructionof the Project, andthe Improvementsrequiredunderthis Agreement.

ExceptforaCityDirectiveasdefinedbelow, theCity'sacceptanceoftheImprovementsshallnot constituteanassumptionbytheCityofanyresponsibilityorliabilityforanydamageoralleged takingofpropertyreferencedunderthisAgreement. TheCityshallnotberesponsibleorliablefor thedesignor constructionof theProjector theImprovementsconstructedor installedpursuantto theapprovedImprovementPlans, regardlessof anyactor omissionby theCity in approvingthe ImprovementPlans, unlesstheparticularImprovementdesignwasrequiredby theCityoverthe written objectionof the Developer, which objection statedthat the Improvementdesignwas potentiallydangerousor defectiveandsetforthanalternativedesign (a " City Directive"). After theCity's acceptanceof theImprovements, theDevelopershallremainobligatedto corrector eliminateall dangerousconditionscreatedby defectsin designor construction (otherthanthose required by a City Directive); provided, however, thattheDevelopershallnotberesponsiblefor routinemaintenance. TheDeveloper's indemnityobligationsunderthis Section6 shallremainin effectfortwo (2) yearsfollowingacceptanceofthelastoftheImprovement(s) bytheCityCouncil.

TheDeveloperacknowledgesandagreesthattheDevelopershallberesponsibleandliablefor the designandconstructionof the Improvementsandotherwork donepursuantto this Agreement, unlessthesameis dueto a City Directive. TheCity shallnot beliable for anyactsor omissions in approving, reviewing, checking, correcting, or modifyinganyImprovementPlans, or in inspecting, reviewing, or approvinganyworkor constructionof Improvements, unlessthesame isdueto aCityDirective. TheDeveloper'simprovementsecurityshallnotberequiredto secure theDeveloper'sobligationsunderthis SubsectionC beyondthewarrantyperiodlistedin Section 4( A)( 3).

D. TheDevelopershallpayandsatisfyanyjudgment, awardordecreethatmay berenderedagainsttheCity andCityPersonneltotheextentof theindemnityprovidedabovein anysuchsuit, action, or otherlegalproceeding, providedtheCity givestheDeveloperprompt written notice of such claim.

E. The Developer' sobligation to indemnify shall not berestricted to Insurance proceeds, if any, receivedbytheCityandCityPersonnel.

F. TheDeveloper, onbehalfof itself andall partiesclaimingunderorthrough 11026- 000 1 \2910473v Ldoc 6
it, herebywaivesall rightsof subrogationandcontributionagainsttheCityandCityPersonnelto the extent of the indemnity aboveprovided.

7. INSURANCE Developer shall at all times during the term of this Agreement, carry andmaintaintheinsurancepoliciessetforthbelow. Thisrequirementmay(T-h '„"" ee et f A belowin Seetio^ 7 will besatisfiedby theinsurancethatDeveloperwill carryandmaintainin connection with satisfied by the temporary traffic control plan encroachment permit (" Traffic Control") and it' s insufanee required by the January 2 —. 2'4- 2024 City Council approvedrevision to EngineeringConditionof Approval #I1 ( DRA 20- 006). In the event the REXCI9Developer does not maintain the " Traffic Control" encroachment permit and required insurancethenREXCI9Developermustprovidetherequiredinsuranceasdetailedbelow in this Agreement.

A. GeneralLiability. TheDevelopershallatall timesduringthetermof this Agreement (aslisted in Section13) carry, maintain, andkeepin full forceandeffecta policy or policiesof comprehensivegeneralliability insurancewith limits of One Million Dollars 1, 000, 000) for each occurrence and Two Million Dollars ($ 2, 000, 000) in the aggregate, combinedsinglelimit, againstbodily injury (includingdeath), or lossor damageto propertyto the extentresultingfromthewrongfulor negligentactsor omissionsof theDeveloper, its officers, employees, and agents, and shall require such coverage of its independent contractors. If such insurancecontainsageneralaggregatelimit, eitherthegeneralaggregateshallapplyseparatelyto thisProject, or thegeneralaggregatelimit shallbethree (3) timestheoccurrencelimit. The Developershall havethe right to provide suchinsuranceunderits existinginsuranceprogram, providedsuchexistinginsurancemeetsalloftherequirementsofthisSubsectionA.

B. AutomobileLiability (includingowned, non -owned, andhiredautos). The Developershallatall timesduringthetermof thisAgreement (aslistedin Section13) alsocarry, maintain, andkeepin full forceandeffectapolicyorpoliciesof commercialautomobileliability insurance with a combined single limit of One Million Dollars ($ 1, 000, 000), single limit, per occurrenceforbodilyinjuryandpropertydamage, whichwill coverthedriversandautomobiles usedto performservicespursuantto thisAgreement. Such insurance shall include coverage for owned, non - owned, and hired automobiles. The Developer shall have the right to provide such insuranceunderits existinginsuranceprogram, providedsuchexistinginsurancemeetsall of the requirements of this Subsection B.

C. Workers' Compensation. The Developer shall at all times during the term of thisAgreement (aslisted in Section13) provideWorkers' CompensationInsurance, including employer'sliability coverage, for theprotectionof theDeveloper'semployees, with aminimum limit of One Million Dollars ($ 1,000,000) or the amount required by law, whichever is greater.

The Developer shall require eachcontractor and subcontractorto provide Workers' Compensation Insurancein the aforementioned amount and file certificates of insurancewith the City evidencing such coverage for their respective employees.
11026- 0001\ 2910473v1. doc 7
D. TheDeveloperagreesthatif it doesnotkeeptheaforesaidinsurancein full forceandeffectthe City mayeither, afterwrittennoticeto theDeveloperandfailureby the Developerto curesamewithin ten (10) days, immediatelyterminatethisAgreementfor defaultby the Developer, or, if insuranceis available at reasonablecost, the City may take out the necessary insuranceandpay, at theDeveloper's expense, thepremiumamount.

E. Thegeneralliabilitypolicyandautomobileliabilitypolicyshalleachbe endorsedto statethattheCityandCityPersonnel, asthattermisdefinedabove, shallbecovered asadditional insureds to the extent of the indemnity in Section 6.

G. TheinsuranceprovidedbytheDevelopershallbeendorsedto statethatthe insurershallwaiveall rightsof subrogationagainsttheCity andCityPersonnel, to theextentof the Indemnity in Section 6.

H. ThepolicyorpoliciesrequiredunderthisAgreementshallbeissuedbyan insurer admitted in the Stateof California with a rating of at leastB+:VII in the latest edition of A. M. Best' s insurance guide.

1. Thecertificatesandendorsementsfor eachinsurancepolicy shallbesigned byapersonauthorizedbythatinsurerorabrokertobindcoverageonitsbehalf. Thecertificates shallalsospecificallystatethatthecoveragecontainedin thosepoliciesaffordsinsurancein compliance with the terms and conditions as set forth in this Agreement.

J. Deductibles. Any deductiblesor self -insuredretentionsof anycontractors or subcontractorsmust be declaredto andapprovedby the City prior to the executionof this Agreement by the City. At the option of the City, either the contractor' s or subcontractor' s insurer(s) shallreduceor eliminatethedeductiblesor self -insuredretentionsregardingtheCity, or thecontractoror subcontractorshallprocureabondguaranteeingpaymentoflossesandexpenses.

K. Notice of Policy Changes. Coverage shall not be suspended, voided, cancelled, reducedin coverageor in limits, non -renewed, or materiallychangedfor anyreason, withoutthirty (30) days' priorwrittennoticethereofgivenbytheDevelopertotheCity.

L. Evidence of Coverage. Prior to commencement of work, the Developer shall submit a certificateor certificatesof insurancein a form acceptableto the City Attorney, showing compliance with the foregoing requirements. The Developer shall ensure those certificatesarevalidatalltimesduringthetermofthisAgreement (aslistedinSection13) orshall replacethemimmediately. TheDevelopershallensurethatallofitscontractorsandsubcontractors requiredin thisAgreementto obtainanyinsuranceshallalsosubmitcertificatesof insurancein form acceptableto the City Attorney showingcompliancewith theforegoingrequirementsprior to commencementof work andshallensurethosecertificatesarevalid at all timesduringtheterm of this Agreement.
11026- 0001\ 2910473v1. doc 8
M. Nothingcontainedin this Section7 shallbeconstruedaslimiting in any waytheDeveloper'sobligationsof indemnificationunderSection6oranyotherextenttowhich the Developermaybe heldresponsiblefor paymentof damagesto personsor propertyresulting fromitsoperations, includingoperationsandworkperformedormaterialssuppliedbyoronbehalf oftheDeveloper, anycontractorsorsubcontractors, orbyanyonedirectlyorindirectlyemployed by any of them.

N. Theabovecoverageswill beprovidedby theDeveloperandmaintainedon behalfof theCity andin accordancewith therequirementssetforthin thisAgreement. If the Developerperformsconstructionactivitiesthrougha generalcontractoror subcontractors, some or all of theseinsurancerequirementsfor theperiodof constructionmaybesatisfiedby thegeneral contractor's or subcontractors' insurancecoverages; provided, however, thatthe Developershall firstprovideawrittenplanfortheapprovalof theCitywhichsetsforththerespectiveobligations and deadlines of the Developer and its contractor and subcontractors.

8. OWNERSHIP OF THE IMPROVEMENTS
A. Ownershipof all or anycategoryof the Improvementsconstructedand installedbytheDeveloperpursuanttothisAgreementtobededicatedshallvest, asapplicable, in theCity (orotherspecifiedgovernmentalagency) uponacceptanceofsaidImprovementsbythe City Councilandrecordationof aNotice of Completion.

B. TheDevelopershallatall timespriorto theacceptanceof theImprovements by theCity, givegoodandadequatewarningto thepublicof eachandeverydangerousand defectiveconditioncausedby the constructionof the Improvementsandshalltakeall steps necessarytoprotectthepublicfromsuchdangerousordefectiveconditions. TheDeveloperagrees andunderstandsthat until acceptanceof the Improvementsby the City, eachImprovementand Improvementareathatis offeredfor dedicationshallbeunderthechargeof theDeveloper, andthe Developermaycloseall or aportionof anystreetor areawhenevernecessaryto protectthepublic duringtheconstructionof theImprovements.

9. DEFAULT AND BREACH BY THE DEVELOPER AND REMEDIES OF THE CITY
A. Upontheoccurrenceof anyof thefollowing events, theDevelopershallbe deemed to be in default under this Agreement:

1. Failure to complete construction and installation of the Improvementsor anyof themby the CompletionDatesetforth in theReferenceData;

2. Failureto promptly corrector cureanydefectin theImprovements oranyofthem (otherthanaCityDirective) duringtheguaranteeandwarrantyperiodrequiredby Section3(A) or failureto commencecorrectionor cureof anysuchdefector failure to diligently prosecutesametocompletion, ineachinstancefollowingwrittennoticethatsuchdefectexists;

3. Failureto performsubstantialwork ontheImprovementsor on any of them, after commencementof work on same, for aperiod of thirty ( 30) days after written notice thereof from the City;
11026- 0001\ 2910473v Ldoc 9

4. Insolvency, appointmentof areceiver, or thefiling of anypetitionin bankruptcy, whethervoluntaryorinvoluntary, andsuchisnotcuredordischargedwithinaperiod of thirty ( 30) days;

5. Commencement of a foreclosure action against the Project or any portionthereof, oranyconveyancebytheDeveloperinlieuorinavoidanceofforeclosure, within thirty (30) daysof writtennoticethereoffrom theCity; or

6. Failure to perform any other obligationsin accordancewith the termsandprovisionsofthisAgreementwithinthetimeperiodspecifiedinthisAgreementforthe performanceofthatobligation, orif notimeisspecified, withinthirty (30) daysofwrittennotice thereof from the City.

B. TheCity reservesto itselfall remediesavailableto it atlaw andin equity foranybreachoftheDeveloper'sobligationsunderthisAgreement. TheCityshallhavetheright, without limitation of other rights or remedies, after written notice to the Developer and a reasonableopportunityfortheDeveloperto cureanysuchallegeddefault, to drawuponorutilize any improvementsecurityfurnishedhereunderto completethe Improvementsor otherwise mitigatetheCity'sdamagesin theeventof theDeveloper'sdefault.

C. Followingthewritten noticeof allegeddefaultandfailureby theDeveloper topromptlycommencethecureof anyallegeddefaultandto diligentlyprosecutesuchcureto completionwithin thetimeperiodsetforth in Section9(A)(6), the City may tender to the surety onthesuretybondfurnishedasimprovementsecurityfor performance, andrequestappropriate fundsorthatsaidsuretytakeoverandcompletetheImprovementsspecifiedunderthisAgreement.

D. The Developer acknowledges that the Estimated Total Costs and improvementsecurityamountssetforthunderthisAgreementmaynotreflecttheactualcostof constructionor installationof the Improvements, andconsequently, the City' s damagesfor the Developer'sdefaultshallbemeasuredby theactualcostof completingtherequiredImprovements.

E. Followingthewrittennoticeof allegeddefaultandfailurebytheDeveloper topromptlycommencethecureofanyallegeddefaultandtodiligentlyprosecutesuchcureto completionwithin thetimeperiodsetforth in Section9 (A)(6), the City may, without liability for so doing, takepossessionof, andutilize in completingthe Improvements, such materials, appliances, plantandotherpropertybelongingtotheDeveloperasmaybeonthesiteofthework andnecessaryfortheperformanceofthework. TheDeveloperherebyconsentstosuchentryby theCityanditsrepresentatives, includingemployees, agents, andcontractors, uponanyreal propertyintheProjectownedbytheDeveloper, intheeventtheCityelectstomaintainorcomplete the work on the Improvements following the Developer' s default.

F. TheCity' sfailureto takeanenforcementactionwith respectto adefault, or to declarea defaultor breach, shallnot be construedasa waiverof thatdefaultor breachor any subsequent default or breach of the Developer.

G. If anylegalactionor otherproceeding, includingactionfor declaratory relief, is broughtfor theenforcementof thisAgreementor becauseof anallegeddispute, breach, default, or misrepresentationin connectionwith this Agreement, the prevailing party shall be 11026- 0001 \ 2910473v 1doc 10
entitledtorecoverreasonableattorneys' fees, experts' fees, andothercosts, in additionto anyother relief to which thepartymaybe entitled.

10. RELATIONSHIP OF THE PARTIES
Neither the Developer, nor any of the Developer's contractors, subcontractors, employees or agents, areorshallbedeemedto be, agentsof theCityin connectionwiththeperformanceof theDeveloper'sobligationsunderthisAgreement. TheDevelopershallnot, atanytime or in any manner, representor allow representationby its contractors, subcontractors, employees, or agents thatanyof themarecontractors, subcontractors, employees, oragentsof theCity.

11. ASSIGNMENT
A. The Developershall not assignthis Agreementor any portion thereof withoutthepriorwrittenconsentoftheCity, whichconsentshallnotbeunreasonablywithheld.

AnyattemptedorpurportedassignmentinviolationofthisSubsectionA shallbenullandvoid and shall have no force or effect.

B. The sale or other disposition of the Project shall not relieve the Developer of its obligations under this Agreement. If the Developer intends to sell the Project or anyportion thereoftoanyotherpersonorentity, theDevelopermayrequestanovationofthisAgreementand asubstitutionof improvementsecurity. Uponthe City'sapprovalof thenovationandsubstitution of improvementsecurity, theDevelopermayrequesta releaseor reductionof theimprovement security furnished pursuant to this Agreement.

12. NOTICES
All noticesrequiredorprovidedforin thisAgreementshallbein writinganddeliveredin personorbymail, postageprepaid, andaddressedasfollows:

Noticeshallbeeffectiveonthedatethatit is deliveredin person, or if mailed, three (3) daysafter the date of deposit in the United States Mail.

13. TERM
Thetermof thisAgreementshallcommenceon theEffectiveDateof Agreementaslisted in the ReferenceDate andshall continueuntil the endof the guaranteeandwarrantyperiodin Section3(A) andwarrantyperiodin Section4(A)(3), unlessanyclaimsfiled duringthattimehave 11026- 0001 \ 2910473v 1.doc I 1
notbeensettled, in whichcasethetermof thisAgreementshallextenduntil thoseclaimshave been settled.

14. ENTIRE AGREEMENT
ThisAgreementconstitutesthe entireagreementof the partieswith respectto its subject matter. All modifications, amendments, or waiversof any termsof this Agreementshallbe in writing andsignedby theduly authorizedrepresentativesof the parties. In the case of the City, thedulyauthorizedrepresentative, unlessotherwisespecifiedunderthisAgreement, shallbethe City Engineer.

15. SEVERABILITY
Theprovisionsof thisAgreementareseverable. If anyportion of this Agreementis held invalidbyacourtofcompetentjurisdiction, theremainderofthisAgreementshallremaininfull force and effect.

16. INCORPORATION OF REFERENCE DATA AND RECITALS
The ReferenceData and the Recitals areincorporated into this Agreement.

17. GOVERNING LAW; VENUE
This Agreementshall be governedby the laws of the Stateof California, excluding California' s choice of law rules. Venuefor any actionrelatingto this Agreementshallbe in the San Bernardino County Superior Court.

18. CONSTRUCTION
In theeventof anyassertedambiguityin, ordisputeregardingtheinterpretationof any matterunderthis Agreement, the interpretationof this Agreementshall not be resolvedby any rulesof interpretationprovidingforinterpretationagainstthepartywhocausestheuncertaintyto existoragainstthepartywhodraftedthisAgreementorwhodraftedthatportionofthisAgreement.

19. EFFECTIVE DATE OF THIS AGREEMENT
ThisAgreementshallbe andbecomeeffectiveasof the datethatit is executedby a duly authorizedofficer or employeeof theCity, it beingtheintentionof thepartiesthattheDeveloper shallfirst executethis Agreementandthereaftersubmitit to the City. The City shallinsertthe effectivedatein theReferenceDatain all counterpartsof thisAgreementandshalltransmitafully executed counterpart to the Developer.
11026- 0001 \ 2910473v Ldoc 12

SIGNATURES BEGIN ON NEXT PAGE
11026- 000 1\2910473v Ldoc 13
IN WITNESSWHEREOF, thepartiesheretohavecausedthisAgreementto be executed by theirrespectiveofficers, thereuntodulyauthorized, asof thedatessetforthbelowtheir respective signatures.

Note: All signatures must be acknowledged by a
notarypublic andtheacknowledgementmustbe
attached. If signed by a corporation, the signatures
of two corporate officers are required, unless a
resolution of the corporation' s board of directors is
providedindicatingthatthe signatureof theone
signatory is sufficient to bind the corporation.]
DEVELOPER"
Type or print exact name of personor
entity)
By:

Signature of authorized officer)
Typeor print nameof authorizedofficer)
Chairperson President Vice
President
By:

Signature of authorized officer)
Type or print name of authorized officer)
Secretary Asst. Secretary
Chief Finance Officer Asst. Treasurer
Date:

SIGNATURES CONTINUE ON NEXT PAGE —
11026- 0001\ 2910473vl. doc 14
CITY"

CITY OF HIGHLAND
Penny Lilburn, Mayor
ATTEST:

SEAL)
Betty Hughes, City Clerk
APPROVED AS TO FORM:

Richards, Watson & Gershon
Maricela Marroquin, City Attorney
11026- 000 1 \2910473v Ldoc 15
NotaryPublicorotherofficercompletingthiscertificateverifiesonlytheidentityof the individual who signed the document to which this certificate is attached, andnot the truthfulness, accuracy, or validity of that document.

State of California
County of
AM before me,
insert name and title of the officer)
NotaryPublic, personallyappeared
whoprovedtomeonthebasisofsatisfactoryevidencetobetheperson(s) whosename(s) is/are subscribedto thewithin instrumentandacknowledgedto methathe/she/theyexecutedthesame in his/ her/ their authorized capacity( ies), andthatby his/her/their signature(s) ontheinstrument the person( s), or theentityuponbehalfof which theperson(s) acted, executedtheinstrument.

I certifyunderPENALTYOFPERJURYunderthelawsof theStateof Californiathat the foregoing paragraph is true andcorrect.

WITNESS my hand and official seal.

Signature ( Seal)
11026- 000 1\2910473v 1.doc 16
NotaryPublicorotherofficercompletingthiscertificateverifiesonlytheidentityofthe individual who signed the documentto 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)
Notary Public, personally appeared
whoprovedtomeonthebasisofsatisfactoryevidencetobetheperson(s) whosename(s) is/are subscribedto thewithin instrumentandacknowledgedto methathe/she/theyexecutedthesame in his/her/their authorized capacity(ies), andthatby his/her/their signature(s) on theinstrument the person( s), or theentityuponbehalfof which theperson(s) acted, executedtheinstrument.

I certifyunderPENALTYOFPERJURYunderthelawsof theStateof Californiathat the foregoing paragraphis true and correct.

WITNESS my hand and official seal.

Signature. Seal)
11026-0001 \2910473vl . doc17
Bond No.

FAITHFUL PERFORMANCE BOND
KNOW ALL PERSONS BY THESE PRESENTS that:

Whereas, the City of Highland, Stateof California, andSanCarloApartmentHomesLLC hereinafter designated as " Principal") have entered into an agreementwhereby Principal agrees to install and completecertaindesignatedpublic improvements, which said agreement, dated February13, 2024, pertainingto the SanCarloI, HighlandTownhomeApartmentsis hereby referred to and made apart hereof, and
Whereas, Principalis requiredunderthetermsof saidagreementto furnishabondfor thefaithful performance of said agreement.

Now, therefore, we, the Principal and as surety ( hereinafter designated as " Surety"), areheldandfirmly bounduntotheCityof Highlandin thepenalsumof dollars ($ ) lawful money of the United States, for the paymentof whichsumwellandtrulyto bemade, webindourselves, ourheirs, successors, executorsandadministrators, jointly andseverally, firmly by thesepresents.

The conditionof this obligationis suchthat if theaboveboundedPrincipal, his, her, or its heirs, executors, administrators, successorsor assigns, shallin all thingsstandto andabideby, andwell andtrulykeepandperformthecovenants, conditionsandprovisionsinthesaidagreementandany alterationthereofmadeasthereinprovided, onhis, her, itsortheirpart, tobekeptandperformed atthetimeandin themannerthereinspecified, andin all respectsaccordingto theirtrueintentand meaning, andshallindemnifyandsaveharmlesstheCityof Highland, itsofficers, agentsand employees, asthereinstipulated, thenthisobligationshallbecomenull andvoid; otherwiseit shall be and remain in full force and effect.

Asapartof theobligationsecuredherebyandin additiontothefaceamountspecifiedtherefor, there shall be included costs and reasonable expensesand fees, including reasonable attorneys' fees, incurredbytheCityofHighlandin successfullyenforcingsuchobligation, alltobetaxedas costs and included in anyjudgment rendered.

Further, Suretyherebywaivestheprovisionsof CaliforniaCivil CodeSections2845and2849.

TheCityofHighlandistheprincipalbeneficiaryofthisbondandhasallrightsofapartyhereto.

IN WITNESSWHEREOF, two (2) identicalcounterpartsof this instrument, eachof which shall forallpurposesbedeemedanoriginalhereof, havebeendulyexecutedbyPrincipalandSurety, on the date set forth below, the nameof eachcorporateparty being heretoaffixed andthese 11026-0001 \2910473vLdoc
presentsdulysignedbyitsundersignedrepresentative(s) pursuantto authorityof itsgoverning body.

Dated:

Principal"
By:

Its:

By:

Its:

Seal)
Note: This bond must be executed in duplicate and dated, all signatures must be notarized, and evidence of the
authority of any person signing as attorney -in -fact
must be attached.

Surety"
By:

Its:

By:

Its:

Seal)
APPROVED AS TO FORM:

RICHARDS, WATSON & GERSHON
A Professional Corporation
By:

City Attorney
11026- 0001 \ 2910473v l . doc
Bond No.

PAYMENT BOND
KNOW ALL PERSONS BY THESE PRESENTS that:

Whereas, the City of Highland, Stateof California, andSanCarloApartmentHomesLLC hereinafter designated as " Principal") have entered into an agreement whereby the Principal agreesto install andcompletecertaindesignatedpublic improvements, which agreement, dated February13, 2024, pertainingto theSanCarloI, HighlandTownhomeApartments, is hereby referred to and made a part hereof; and
Whereas, under the terms of the agreement, the Principal is required before entering upon the performanceofthework, tofileagoodandsufficientpaymentbondwiththeCityofHighlandto securetheclaimstowhichreferenceismadein Part6 (commencingwith Section8000) of Division 4 of the Civil Code.

Now, therefore, the Principal and , as surety (hereinafter designated as "Surety"), areheldfirmly bounduntotheCity of Highlandandall contractors, subcontractors, laborers, materialsuppliers, andotherpersonsemployedin theperformanceof theagreementand referredtoin Part6 (commencingwith Section8000) of Division4of theCivil Codein thepenal sum of dollars ($ ), for materials furnished or labor thereon of anykind, orforamountsdueundertheUnemploymentInsuranceActwithrespecttothisworkor labor, thattheSuretywill paythesamein anamountnotexceedingtheamounthereinaboveset forth, andalsoin casesuit is broughtupon this bond, will pay, in additionto the faceamount thereof, costsandreasonableexpensesandfees, includingreasonableattorneys' fees, incurredby theCityofHighlandin successfullyenforcingthisobligation, tobeawardedandfixedbythecourt, andto betaxedascostsandto beincludedin thejudgmentthereinrendered.

It isherebyexpresslystipulatedandagreedthatthisbondshallinuretothebenefitofanyandall persons, companies, andcorporationsentitledto file claimsunderPart 6 ( commencing with Section 8000) of Division 4 of the Civil Code, so asto give aright of action to them or their assigns in anysuitbroughtuponthis bond.

Shouldtheconditionof thisbondbefully performed, thenthisobligationshallbecomenull and void, otherwise it shall be and remain in full force and effect.

Further, Suretyherebywaivestheprovisionsof CaliforniaCivil CodeSections2845and2849.

TheCityofHighlandistheprincipalbeneficiaryofthisbondandhasallrightsofapartyhereto.

TheSuretyherebystipulatesandagreesthatnochange, extensionof time, alteration, oraddition to the terms of the agreementor the specifications accompanying the same shall in any manner affectits obligationsonthisbond, andit doesherebywaivenoticeof anysuchchange, extension, alteration, or addition.

IN WITNESSWHEREOF, two (2) identicalcounterpartsof this instrument, eachof which shall forallpurposesbedeemedanoriginalhereof, havebeendulyexecutedbyPrincipalandSurety, on the dateset forth below, the nameof eachcorporateparty being hereto affixed andthese 11026- 0001 \ 2910473v 1.doc
presentsdulysignedby itsundersignedrepresentative(s) pursuantto authorityof itsgoverning body.

Dated:

Principal"
By:

Its:

By:

Its:

Seal)
Note: This bond must be executed in duplicate and dated, all signaturesmustbe notarized, and evidenceof the
authorityof anypersonsigningas attorney -in -fact
must be attached.

Surety"
By:

Its:

By:

Its:

Seal)
APPROVED AS TO FORM:

RICHARDS, WATSON & GERSHON
A Professional Corporation
By:

City Attorney
11026- 0001\ 2910473v1. doc

WARRANTY BOND
KNOW ALL PERSONS BY THESE PRESENTS that:

Whereas, theCity of Highland, Stateof California, andSanCarloApartmentHomesLLC hereinafter designated as "Principal") have entered into an agreement, dated _ February 13, 2024, pertainingtotheSanCarloI, HighlandTownhomeApartments, isherebyreferredtoandmadea part hereof; and
Whereas, Principalis requiredunderthe termsof saidagreementto furnish a bondfor the good andsufficientwarrantyof allof theimprovementsinstalledpursuantto saidagreement.

Now, therefore, we, the Principal and , as surety ( hereinafter designated as " Surety"), areheldandfirmlybounduntotheCityof Highlandin thepenalsumof dollars ($ ) lawful money of the United States, for the paymentofwhichsumwellandtrulytobemade, webindourselves, ourheirs, successors, executorsandadministrators, jointly andseverally, firmly by thesepresents.

Theconditionof this obligationis suchthat, if theherebyboundedPrincipal, his, heror its heirs, executors, administrators, successors or assigns, shall remedy, without cost to the City of Highland, anydefectswhichmaydevelopduringaperiodof one (1) yearfromthedateofthe completionandacceptanceof thelastof theimprovementsinstalledundertheagreement, caused bydefectiveorinferiormaterialsorworkmanshipasdeterminedbytheCity, andshallindemnify, defendandholdharmlesstheCityof Highland, itsofficers, agents, andemployeesfor anyandall claims, demands, causes of action, damages, injuries, liabilities, losses, costs or expenses, includingattorneys' feesandcostsofdefense, whichariseoutof, pertainto, orrelatetosuch defectsorinferior materialsorworkmanshipor tothePrincipal'sactionsor inactionsin remedying suchdefectsorinferiormaterialsorworkmanship, thenthisobligationshallbecomenullandvoid; otherwise it shall be and remain in full force and effect.

If suitis broughtuponthisbond, Suretyfurtheragreesto pay, in additionto thePenalSum, all costsandreasonableexpensesandfees, includingreasonableattorneys' fees, incurredby theCity ofHighlandin successfullyenforcingsuchobligation, all tobetaxedascostsandincludedin any judgmentrendered.

Further, Suretyherebywaivestheprovisionsof CaliforniaCivilCodeSections2845and2849.

TheCityofHighlandistheprincipalbeneficiaryofthisbondandhasallrightsofapartyhereto.

TheSuretyherebystipulatesandagreesthatnochange, extensionof time, alterationoradditionto the terms of the agreement or to the work to be performed thereunder or the specifications accompanyingthesameshallin anywiseaffectitsobligationsonthisbond, andit doeshereby waivenoticeof anysuchchange, extensionof time, alterationor additionto thetermsof the agreement or to the work or to the specifications.
11026- 0001\ 2910473v1. doc
IN WITNESSWHEREOF, two (2) identicalcounterpartsof this instrument, eachof which shall forallpurposesbedeemedanoriginalhereof, havebeendulyexecutedbyPrincipalandSurety, on the dateset forth below, the nameof eachcorporateparty being heretoaffixed and these presentsdulysignedbyitsundersignedrepresentative(s) pursuanttoauthorityofitsgoverning body.

Dated:

Principal"
By:

Its:

By:

Its:

Seal)
Note: This bond must be executed in duplicate and dated, all signatures must be notarized, and evidence of the
authority of any person signing as attorney -infact
must be attached.

Surety"
By:

Its:

By:

Its:

Seal)
APPROVED AS TO FORM:

RICHARDS, WATSON & GERSHON
A Professional Corporation
By:

City Attorney
11026- 0001 \ 2910473v l . doc

Highland City CouncilFebruary 13, 2024

Highland City Council
February 13, 2024