Agenda packet — Ontario City Council, May 16, 2023 (part 3 of 5)

(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 City declined to adopt.

SECTION 3: Housing Element Compliance. Pursuant to the requirements of California Government Code Chapter 3, Article 10.6, commencing with Section 65580, as the recommending authority for the Project, the Planning Commission finds that based on the facts and information contained in the Application and supporting documentation, at the time of Project implementation, the project is consistent with the Housing Element of the Policy Plan (General Plan) component of The Ontario Plan, as the project site is not one of the properties in the Housing Element Sites Inventory contained in Tables B-1 and B-2 of the Housing Element Technical Report.

SECTION 4: Airport Land Use Compatibility Plan ("ALUCP") Compliance.

(1) On April 19, 2011, the City Council of the City of Ontario approved and adopted the Ontario International Airport Land use Compatibility Plan, establishing the Airport Influence Area for Ontario International Airport, which encompasses lands within parts of San Bernardino, Riverside, and Los Angeles Counties, and limits future land uses and development within the Airport Infl uence Area , as they relate to noise, safety, airspace protection, and overflight impacts of current and future airport activity. A s the recommending body for the Project, the Planning Commission has reviewed and considered the facts and information contained in the Application and supporting documentation against the ONT ALUCP compatibility factors, including [1] Safety Criteria (ONT ALUCP Table 2 -2) and Safety Zones ( ONT ALUCP Map 2 -2), [2] Noise Criteria (ONT ALUCP Table 2-3) and Noise Impact Zones ( ONT ALUCP Map 2-3), [3] Airspace protection Zones ( ONT ALUCP Map 2- 4), and [ 4] Overflight Notification Zones ( ONT ALUCP Map 2-5). As a result, the Planning Commission, therefore, finds and determines that the Project, when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the ONT ALUCP; and

(2) On August 2, 2022, the City Council of the City of Ontario approved and adopted a Development Code Amendment to establish the Chino Airport ("CNO") Overlay Zoning District ( "OZD") and Reference I , Chino Airport Land Use Compatibility Plan ("CNO ALUCP"). The CNO OZD and CNO ALUCP established the Airport Influence Area for Chino Airport, solely within the City of Ontario, and limits future land uses and development within the Airport Influence Area, as they relate to safety, airspace protection, and overflight impacts of current and future airport activity. The CNO ALUCP 928
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is consistent with policies and criteria set forth within the Caltrans 2011 California Airport Land Use Planning Handbook. The proposed Project is located within the Airport Influence Area of Chino Airport and was evaluated and found to be consistent with the California Airport Land Use Planning Handbook and the CNO ALUCP. As the recommending body for the Project, the Planning Commission has reviewed and considered the facts and information contained in the Application and supporting documentation against the CNO ALUCP compatibility factors, including Safety, Airspace Protection, Overflight. As a result, the Planning Commission , therefore, finds and determines that the Project , when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the California Airport Land Use Planning Handbook and the Chino ALUCP.

SECTION 5: Concluding Facts and Reasons. Based upon the substantial evidence presented to the Planning Commission during the above- referenced hearing, and upon the specific findings set forth in Section 1 through 4 , above, the Planning Commission hereby concludes as follows:

(1) The Development Agreement applies to approximately 159.95 acres of land bordered by Eucalyptus Avenue to the north, Bon View Avenue to the west, Merrill Avenue to the south, and Grove Avenue to the east, within the Industrial and Business Park land use districts of the South Ontario Logistics Center Specific Plan (File No.

PSP19-001); and

(2) The Development Agreement establishes parameters for the development of land within the South Ontario Logistics Center Specific Plan. The Development Agreement also grants the Applicant, the right to develop, the ability to quantify the fees; and establish the terms and conditions that apply to those projects. These terms and conditions are consistent with The Ontario Plan Policy Plan (General Plan), design guidelines and development standards for the South Ontario Logistics Center Specific Plan; and

(3) The Development Agreement grants the O wner a vested right to develop Tentative Parcel Map 20161 (File No. PMTT20-011) as long as the Owner complies with the terms and conditions of the Specific Plan and EIR. Tentative Parcel Map 20161 is bordered by Eucalyptus Avenue to the north, Bon View Ave nue to the west, Merrill Avenue to the south, and Grove Avenue to the east, and proposes to subdivide 159.95 acres of land into 10 parcels, to facilitate the potential development of 5,333,518 square feet of business park and industrial uses; and

(4) The Development Agreement has been prepared in conformance with the goals and policies of The Ontario Plan Policy Plan (General Plan); and

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(5) The Development Agreement does not conflict with the Land Use Policies of The Ontario Plan Policy Plan (General Plan) and w ill provide for development, within the district, in a manner consistent with the Policy Plan and with related development; and

(6) This Development Agreement will promote the goals and objectives of the Land Use Element of the Policy Plan; and

(7) This Development Agreement will not be materially injurious or detrimental to the adjacent properties and will not have a significant impact on the environment or the surrounding properties. The environmental impacts of this project were previously reviewed in conjunct ion with the South Ontario Logistics Center Specific Plan (File No.

PSP19-001), for which an Environmental Impact Report (State Clearinghouse No. 2021010318) was certified by City Council on March 1, 2022; and

(8) This Application introduces no new significant environmental impacts. All previously adopted mitigation measures are a condition of project approval and are incorporated herein by this reference.

SECTION 6: Planning Commission Action. Based upon the findings and conclusions set forth in Sections 1 through 5, above, the Planning Commission hereby RECOMMENDS THE CITY COUNCIL APPROVES the herein described Application, subject to each and every condition set forth in the Development Agreeme nt (File No.

PDA21-005) attached hereto as " Attachment A ," and incorporated herein by this reference.

SECTION 7: Indemnification. The Applicant shall agree to defend, indemnify and hold harmless, the City of Ontario or its agents, officers, and employees from any claim, action or proceeding against the City of Ontario or its agents, officers or employees to attack, set aside, void, or annul this approval. The City of Ontario shall promptly notify the applicant of any such claim, action, or proceeding, and the City of Ontario shall cooperate fully in the defense.

SECTION 8: Custodian of Records. The documents and materials that constitute the record of proceedings on which these findings have been based are located at the City of Ontario City Hall, 303 East "B" Street, Ontario, California 91764. The custodian for these records is the City Clerk of the City of Ontario.

SECTION 9: Certification to Adoption. The Secretary shall certify to the adoption of the Resolution.

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ATTACHMENT A:

File No. PDA21-005

DEVELOPMENT AGREEMENT

By and Between

CITY OF ONTARIO
a California municipal corporation

and

GROVE LAND VENTURE LLC
a Delaware limited liability company

(Development Agreement to follow this page)

933

1 RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

CITY OF ONTARIO

CITY CLERK / RECORDS MANAGEMENT
303 EAST "B" STREET
ONTARIO, CA 91764-4196
______________________________________________________________________ Space above this line for Recorder's Use Only Exempt from Fees Per Gov. Code § 6103

File No. PDA21-005

DEVELOPMENT AGREEMENT

By and Between

CITY OF ONTARIO
a California municipal corporation

and

GROVE LAND VENTURE, LLC.
a Delaware limited liability company

______________, 2023

San Bernardino County, California
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2 DEVELOPMENT AGREEMENT NO. PDA21-005
This Development Agreement (hereinafter "Agreement") is dated for reference purposes only as of the ____ day of ____________, 2023 by and among the City of Ontario, a California municipal corporation (hereinafter "CITY"), and Grove Land Venture, LLC.,, a Delaware limited liability company (hereinafter "OWNER"):

RECITALS
WHEREAS, CITY 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 Section

4.01.015 of the Ontario Development Code; and
WHEREAS, OWNER has requested C ITY to enter into a development agreement and proceedings have been taken in accordance with the rules and regulations of CITY; and
WHEREAS, by electing to enter into this Agreement, CITY shall bind future City Councils of CITY by the obligations specified herein and limit the future exercise of certain governmental and proprietary powers of CITY; and
WHEREAS, the terms and conditions of this Agreement have undergone extensive review by CITY and the City Council and have been found to be fair, just and reasonable; and
WHEREAS, the best interests of the citizens of the CITY and the public health, safety and welfare will be served by entering into this Agreement; and WHEREAS, all of the procedures of the California Environmental Quality Act, P ub.

3 Agreement will provide substantial benefits to CITY and will further important policies and goals of CITY; and
WHEREAS, this Agreement will eliminate uncertainty in planning and provide for t
he 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 Section 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. DE
FINITIONS 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 " CITY" means the City of Ontario, California, a California municipal corporation.

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 public 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 Approvals" means all permits and other entitlements for use subject to approval or issuance by CITY in connection with development of the Property including, but not limited to:
(a) general plans and general plan amendments; and specific plans and specific plan amendments;
(b) tentative and final subdivision and parcel maps;
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4 (c) development plan review.

1.1.5 " Development Exaction" means any requirement of CITY 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.

1.1.6 " 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, and, for purposes of this Agreement only, includes fees collected under development agreements adopted pursuant to Article 2.5 of the Government Code (commencing with Section 65864) of Chapter 4. For purposes of this Agreement only, " Development Impact Fee " shall not include processing fees and charges imposed by CITY to cover the estimated actual costs to CITY 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 loc al 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 o f 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.

1.1.7 " Development Plan" means the Existing Development Approvals and the Existing Land Use Regulations applicable to development of the Property.

1.1.8 "Effective Date" means the date that the ordinance approving this Agreement goes into effect.

1.1.9 " Existing Development Approvals " means all Development Approvals approved or issued on or 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.

1.1.10 "Existing Land Use Regulations" means all Land Use Regulations in effect on the date of the first reading of the ordinance adopting and approving this Agreement. 937
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5 Existing Land Use Regulations includes the Regulations incorporated herein as Exhibit "D" and all other Land Use Regulations that are in effect and a matter of public record on such date.

1.1.11 "General Plan " means The Ontario Plan adopted August 16, 2022, as amended up to the date of the first reading of the ordinance adopting and approving this Agreement.

1.1.12 "Improvement" or "Improvements" means those public improvements required to support the development of the Project as described in the Parcel Map conditions for Parcel Map No. 20161 ("Parcel Map") as further described in Exhibit "E" and depicted in Exhibit “F”(together, the "Infrastructure Improvements Exhibit").

1.1.13 "Land Use Regulations" means all ordinances, resolutions, codes, rules, regulations and official policies of CITY 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 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 CITY 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 that provide for the use of or the entry upon public property; (e) the exercise of the power of eminent domain.

1.1.14 "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.

1.1.15 "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.

1.1.16 "Owner Affiliate" shall mean, (i) any entity that directly or indirectly controls, is controlled by, or is under common control with OWNER, or (ii) an entity at least a majority of whose economic interest is owned by OWNER. For purposes of this definition, the term “control” means the power to direct the management of such entity through voting rights, ownership or contractual obligations.

1.1.17 “Phase” means the development area described i n the Infrastructure Improvements Exhibit to this Agreement.
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6 1.1.18 “Phase 2 Water Participation Fee” means the fee paid to the CITY for the Project, to fund the Property’s respective share of the project costs of the design and construction of the Phase 2 Water Improvements by the CITY. The Phase 2 Water Participation Fee shall be the calculated amount of the Regional Water DIF for the Project based upon the number of square feet, acreage, and land use category for non-residential square footage of the Project.

1.1.19 "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.

1.1.20 "Property" means the real property described on Exhibit "A" and shown on Exhibit "B" to this Agreement.

1.1.21 "Reservations of Authority " means the rights and authority excepted from the assurances and rights provided to OWNER under this Agreement and reserved to CITY under Section 3.4 of this Agreement.

1.1.22 "Specific Plan" means that certain specific plan adopted by the City Council, and entitled, "South Ontario Logistics Center Specific Plan”.

1.1.23 "Subsequent Development Approvals " means all discretionary Development Approvals required subsequent to the Effective Date in connection with development of the Property. Subsequent Development Approvals shall be deemed to be subject to the provisions of this Agreement, without any further action needed on the part of either the CITY or OWNER.

1.1.24 "Subsequent Land Use Regulations " means any discretionary Land Use Regulations adopted and effective after the Effective Date of this Agreement.

1.2 E
xhibits . 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" — Description of Required Infrastructure Improvements Exhibit "F" — Depiction of Infrastructure Improvements Exhibits

Exhibit "G" – Form of Certificate of DIF Credit to be issued by CITY

2. G
ENERAL PROVISIONS.
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7 2.1 Binding Effect of Agreement. The Property is hereby made subject to this Agreement. Development of the Property is hereby authorized and shall 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 fee simple title or the lessee or an optionee of the Property or a portion(s) thereof. . To the extent applicable, OWNER has obtained 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 term of ten (10) years thereafter unless this term is modified or extended pursuant to the provisions of this Agreement. Upon approval by the City Manager, without the need for City Council approval, 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) O
WNER provides at least 180 days written notice to CITY prior to expiration of the initial term; and
(b) OWNER is not then in uncured default of this Agreement.

2.4 A ssignment.

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 obliga tions arising under or from this Agreement with respect to the portion of the Property sold and be made in strict compliance with the following:
(a) E
xcept as expressly provided for herein, 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 CITY 's City Manager, in writing, of such sale, transfer or assignment and shall provide CITY with: (1) an executed agreement, in a form reasonably acceptable to CITY, 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. (c) 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 940
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8 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 City 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. (d) Notwithstanding the foregoing, OWNER shall have the right to assign this Agreement to an Owner Affiliate subject to the notice requirements to CITY as described in Paragraph (b) of this Section 2.4.1, above.

2.4.2 R
elease 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 CITY, which release shall be provided by CITY upon the full satisfaction by such transferring owner of the following conditions:
(a) O
WNER no longer has a legal or equitable interest in all or any part of the portion of the Property sold, transferred or assigned.
(b) OWNER is not then in default under this Agreement.
(c) OWNER has provided CITY with the notice and executed an agreement as required under Paragraph (b) of Subsection 2.4.1 above. (d) The purchaser, transferee or assignee provides CITY with security equivalent to any security previously provided by OWNER (if any) to secure performance of its obligations hereunder which are to be performed upon portion of the Property sold, transferred or assigned.

2.4.3 E
ffect of Assignment and Release of Obligations. In the event of a sale, transfer or assignment pursuant to the provisions of Section 2.4.1 and notwithstanding the release provisions of Section 2.4.2 above:
(a) T
he 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.

9 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 (1) year) of any parcel 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 of the parcel. 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) T
he lot has been finally subdivided and individually (and not in " bulk") sold or leased (for a period longer than one (1) 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 parcel, and the fees set forth under Section 4 of this Agreement have been paid.

2.4.6 P artial Assignment and Assumption . CITY 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 CITY. Any such complete and executed partial assignment and assumption of this Agreement shall be submitted to CITY for approval pursuant to Section 2.4.1 of this Agreement. Within thirty (30) days following such complete submittal, CITY shall review, and if the above conditions are satisfied, may approve the partial assignment and release and notify the purchas or, 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 only in the manner provided for in Government Code Section 65868.1. Any amendment of this Agreement, which amendment has been requested by OWNER, shall be con sidered by the CITY only upon the payment of the applicable processing charge. This provision shall not limit any remedy of CITY or OWNER as provided by this Agreement. Either p arty or successor in interest, may propose an amendment to or cancellation, in whole or in part, of this Agreement. Any amendment or cancellation shall be by mutual consent of the parties or their successors in interest except as provided otherwise in this Agreement or in Government Code Section 65865.1. 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 CITY initiates the proposed amendment to, or cancellation of, in whole or in part, this Agreement, CITY shall first give notice to the OWNER of its intention to initiate such proceedings at least sixty (60) days 942
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10 in advance of the giving the public notice of intention to consider the amendment or cancellation.

2.6 M inor Modification . Upon the written application of OWNER, minor modifications and changes to the Development Plan including modifications to building d esign 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 Pla n shall be processed pursuant to the City Zoning Ordinance. It is also contemplated by CITY 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 CITY 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 CITY , 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) E xpiration 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 CITY or applicable public agency of all required dedications.

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 service mitigation fees paid pursuant to Section 4.2 of this Agreement by OWNER to CITY on which construction has not yet begun shall be refunded to OWNER by CITY within ten (10) business days.

11 (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 CITY:

Scott Ochoa, City Manager
City of Ontario
303 East "B" Street
Ontario, CA 91764
If to OWNER:

Jeff Johnston
Grove Land Venture, LLC.
c/o Real Estate Development Associates
4450 MacArthur Blvd., Suite 100
Newport Beach, CA 92660
jj [email protected]

with a copy to:

Ruben Duran, City Attorney
Best Best & Krieger, LLP
2855 E Guasti Road
Ontario, CA 91761

With a copy to:

Matt Fogt, Esq.

Allen Matkins Leck Gamble Mallory&
Natsis, LLP
2010 Main Street, 8
th Floor
Irvine, CA 92614

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.

3. D
EVELOPMENT OF THE PROPERTY.

3.1 Rights to Develop. Subject to the terms of this Agreement including the Reservations of Authority in Section 3.4, OWNER shall have a vested right to develop the Property in accordance with, and to the extent of, the Development Plan. The Project shall remain subject to all Subsequent Development Approvals required to complete the Project as contemplated by 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 Development Plan.

12 connection with any Subsequent Development Approval, CITY shall exercise discretion in accordance with the same manner as it exercises its 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 T
iming 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.

City 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.

3.3.1 Infrastructure Improvement Exhibit. A
ttached hereto as Exhibits “E” and "F"
are a description and dep iction, respectively, of the Improvements needed for the development of the Property. In the event of any discrepancy between Exhibit E and Exhibit F, Exhibit F shall control.

3.4 Reservations of Authority.

3.4.1 Limitations, Reservations and Exceptions . Notwithsta nding any other provision of this Agreement, the CITY shall not be prevented from applying new rules, regulations and policies upon the OWNER, nor shall a development agreement prevent the CITY 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) P
rocessing fees by CITY to cover 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 and any other matter of procedure; (c) Regulations, policies and rules governing engineering and construct ion standards and specifications applicable to public and private improvements, including all uniform codes adopted by the CITY and any local amendments to those codes adopted by the CITY; provided however that, OWNER shall have a vested right to develop t he Property in accordance with, and to the extent of, the standards and specifications that are expressly identified in the Specific Plan and the building codes in effect as of the Effective Date;
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13 (d) Regulations that may conflict with this Agreement and the D evelopment Plan but that are reasonably necessary to protect the occupants of the Project and/or of the immediate community from a condition perilous to their health or safety; (e) Regulations that do not conflict with those rules, regulations and policies set forth in this Agreement or the Development Plan and which do not impose additional obligations, costs, and expenses on OWNER or the Project; (f) Regulations that may conflict with this Agreement but to which the OWNER consents.

3.4.2 S
ubsequent Development Approvals. This Agreement shall not prevent CITY, in acting on Subsequent Development Approvals, from applying Subsequent Land Use Regulations that do not conflict with the Development Plan and/or the Existing Development Approvals, nor shall this Agreement prevent CITY from denying or conditionally approving any Subsequent Development Approval on the basis of the Existing Land Use Regulations or any Subsequent Land Use Regulation not in conflict with the Development Plan and/or the Existing Development Approvals.

3.4.3 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 CITY 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 3.4.3 shall impose on CITY any monetary liability for contesting such declaratory relief (or other similar non- monetary relief).

3.4.4 Intent. The parties acknowledge and agree that CITY 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 CITY 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 CITY all such power and authority which cannot be restricted by contract.

3.5 Public Works; Utilities.

If OWNER is required by this Agreement or a condition of Project approval to construct any public works facilities which will be dedicated to CITY 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 standards as would be applicable to CITY or such other public agency should it have undertaken such construction. As a condition of development approval, OWNER shall connect the 946
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14 Project to all utilities necessary to provide adequate water, recycled water, sewer, gas , electric, and other utility services necessary for the Project, as further described and depicted in the Infrastructure Imp rovements Exhibit. As a further condition of development approval, OWNER shall to the extent possible contract with the CITY for CITY-owned or operated utilities for this purpose, for such price and on such terms as may be available to similarly situated customers in the CITY. As a further condition of development approval, to the extent OWNER does not own the Property in fee simple, OWNER will provide to CITY the written consent from the current fee owner of the Property agreeing to the terms of this Agreement and the recordation thereof , pursuant to Section 2.2.

3.5.1 OWNER agrees that development of the Project shall require the construction of storm drain Improvements from the Property described in Exhibit E and depicted in Exhibit F. OWNER shall be responsible for payment of a fee in- lieu (the “Euclid Avenue Storm Drain In -Lieu Fee) of actual construction of the ultimate Euclid Avenue storm drain Improvements , south of Merrill Avenue, depicted in Exhibit F .

OWNER shall pay the CITY, prior to the request for occupancy of any building on the Property, Four Million Twelve Thousand One Hundred Ninety Dollars ($4,012,190). Upon OWNER’S complete payment of the Euclid Avenue Storm Drain In- Lieu Fee, the CITY shall issue a Certificate of DIF Credit in the Regional Storm Drain category equal to the amount paid to the CITY. Such Regional Storm Drain DIF Certificate shall be issued by CITY within thirty (30) business days of the receipt of such required payment. OW NER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY, and OWNER agrees that OWNER shall not request and CITY shall not issue a final occupancy permit for any buildings prior to payment of the Euclid Avenue Storm Drain In-Lieu Fee and construction of the storm drain Improvements described in Exhibit E and depicted in Exhibit F. CITY and OWNER mutually acknowledge and agree, t hat upon OWNER’s complete payment of the Euclid Avenue Storm Drain In-Lieu Fee, such obligation shall be deemed satisfied and CITY shall not hold up a request for final occupancy permit for any buildings on the Property, based on the actual construction and completion of the ultimate Euclid Avenue storm drain Improvements. C ITY agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building- by-building basis prior to completion of the storm drain improvements.

3.5.2 OWNER agrees that development of the Project shall require the construction of street Improvements as described in Exhibit E and depicted in Exhibit F.

15 the street Improvements . OWNER agrees that the street improvements shall be completed and subject to final acceptance by CITY prior to the release of any security for the construction of the street improvements. OWNER and CITY agree that a portion of the street Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others, or pursuant to a cooperative agreement with others. If such street Improvements are constructed by others, or in cooperation with others, and are completed and accepted by CITY prior to OWNER 's request to CITY of the required grading, building or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those street Improvements constructed and completed by others and accepted by CITY.

3.5.3 OWNER agrees that development of the Property shall require the construction of water utility Improvements as described in Exhibit E and depicted in Exhibit F consisting generally of the construction of the potable water Improvements to serve the Property as described in Exhibit E and depicted in Exhibit F. OWNER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY upon completion of sufficient water improvements to serve the Property from at least one point of connection. OWNER and CITY agree that OWNER may, in- lieu of utilizing recycled water during grading and construction, utilize water from existing agricultural wells on the Property subject to the terms of a separate Well Use Agreement between the CITY and OWNER. OWNER agrees that OWNER shall not request and CITY shall not issue a final occupancy permit for any buildings on the Property until the completion of the potable water improvements described in Exhibit E and depicted in Exhibit F. City agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building- by-building basis prior to completion of the water improvements if there is available permanent water service from a minimum of two (2) points of connection and sufficient water is available for fire protection purposes for any buildings while under construction. OWNER and CITY agree that a portion of the water Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others, or pursuant to a cooperative agreement with others. If such water Improvements are constructed by others, or in cooperation with others, and are completed and accepted by CITY prior to OWNER's request to CITY of the required grading, building or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those water Improvements constructed and completed by others and accepted by CITY.

3.5.4 OWNER agrees that development of the Property shall require the construction of sewer Improvements as described in Exhibit E and depicted in Exhibit F.

16 Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others, or pursuant to a cooperative agreement with others. If such sewer Improvements are constructed by others, or in cooperation with others, and are completed and accepted by CITY prior to OWNER's request to CITY of the required grading, building or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those sewer Improvements constructed and completed by others and accepted by CITY.

3.5.5 OWNER agrees that development of the Property shall require the construction of recycled water utility improvements to serve the Property, consisting generally of the construction of recycled water utility Improvements as described in Exhibit E and depicted in Exhibit F. OWNER and CITY agree that the CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY upon completion of sufficient water and recycled water improvements to serve the Property from at least one (1) point of connection and OWNER agrees that OWNER shall not request and CITY shall not issue any occupancy permit for any buildings on the Property until the completion of the water improvements described in Exhibit E and depicted in Exhibit F. CITY agrees that OWNER may request a temporary occupancy permit for a building and, if OWNER requests that a temporary certificate of occupancy be issued for a building prior to the completion of the extension of permanent master planned recycled water utility Improvements to serve the Property that CITY may consider such request and may issue temporary certificates of occupancy on a building-by-building basis prior to completion of recycled water improvements if there is available permanent recycled water service connection and sufficient recycled water is available. OWNER and CITY agree that all, or a portion of, the permanent master planned recycled water utility Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others. If such recycled water utility Improvements are constructed by others and completed and accepted by CITY prior to OWNER'S request to CITY of the required grading, building, or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those permanent master planned recycled water utility Improvements.

17 3.6 Acquisition of Offsite Provision of 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 ( "Offsite Improvements"), the CITY and OWNER shall c ooperate in acquiring the necessary legal interest ( "Offsite Property") as described below in Section 3.7 . This S ection 3.6 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 CITY upon the development of the Project under the Subdivision Map Act or other legal authority.

3.7 Real Property Interests.

3.7.1 CITY Acquisition of Offsite Property . In the event OWNER is required to construct any public improvements on land not owned by OWNER, Sections 3. 7.1 and

3.7.2 shall control the acquisition of the Offsite Property. If the OWNER is unable to acquire such Offsite Property, and following the written request from the OWNER to CITY, CITY agrees to use reasonable and diligent good faith efforts to acquire the Offsi te Property from the owner or owners of record by negotiation to the extent permitted by law and consistent with this Agreement. If CITY is unable to acquire the Offsite Property by negotiation within thirty (30) days after OWNER 'S written request, CITY may, initiate proceedings utilizing 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 3.7.1 The CITY and OWNER acknowledge that the timelines set forth in this Section 3.7.1 represent the maximum time periods which CITY and OWNER reasonably believe will be necessary to complete the acquisition of any Offsite Property. CITY 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 CITY.

18 3.8 Regulation by Other Public Agencies. It is acknowledged by the parties that other public agencies not within the control of CITY possess authority to regulate aspects of the development of the Property separately from or jointly with CITY and this Agreement does not limit the authority of such other public agencies. CITY agrees to cooperate fully, at no cost to CITY, with OWNER in obtaining any required permits or compliance with the regulations of other public agencies provided such cooperation is not in conflict with a ny laws, regulations or policies of the CITY.

3.9 Tentative Parcel Maps . W
ith respect to applications by OWNER for tentative
parcel maps for portions of the Property, CITY 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 CITY'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 expiration, cancellati on, or termination of this Agreement.

3.10 Specific Plan Charge. Pursuant to Government Code section 65456, the City Council may consider adopting a specific plan charge upon persons seeking CITY approvals that are required to be consistent with the Specific Plan. Any such charges shall, in the aggregate, defray, but not exceed, the estimated cost of preparation, adoption, and administration of the Specific Plan, including costs incurred pursuant to the California Environmental Quality Act (Pub. Resources Code, §§ 21000 et seq.). As nearly as can be estimated, the charges shall be a prorated amount in accordance with the applicant’s relative benefit derived from the Specific Plan. If such charges are adopted, the CITY shall use such charges to reimburse the OWNER who originally paid the cost of preparing the Specific Plan, including costs incurred pursuant to the California Environmental Quality Act (Pub. Resources Code, §§ 21000 et seq.) to the extent the OWNER paid more than its relative benefit from the Specific Plan. Such charges, if adopted, shall be imposed on persons seeking CITY approvals that are required to be consistent with the Specific Plan, to the extent such person(s) has/have not entered into a reimbursement agreement with, and satisfactory to, the person(s) originally responsible for the cost of preparing the Specific Plan, including costs incurred pursuant to CEQA.

4. PUBLIC BENEFITS.

4.1 Intent. The parties acknowledge and agree that development of the Property will result in substantial public needs that will not be fully met by the Development Plan and further acknowledge and agree that this Agreement confers substantial private benefits on OWNER that 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.
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19 4.2.1 Amount of Development Impact 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 CITY 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 CITY 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 CITY.

4.2.2 Time of Payment. The Development Impact Fees required pursuant to Section 4.2.1 shall be paid to CITY prior to the issuance of building permit for each applicable building (subject to the application/use of available fee deferrals or credits), except for the Species, Habitat Conservation, and Open Space Mitigation Development Impact Fee, which shall be paid by OWNER to CITY prior to the issuance of a grading permit.

4.3 Responsibility for Construction of Public Improvements.

4.3.1 Timely Construction of Public Infrastructure. The phasing of the area wide infrastructure construction within the vicinity of the Project shall be as approved by the CITY. OWNER shall be responsible for the timely construction and completion of all public infrastructure required for the Project as described and depicted in the Infrastructure Improvements Exhibit and any and all parcel map conditions . Unless otherwise specified in the Parcel Map conditions, and subject to the provisions of Section

3.5 and 3.6, all other required Improvements for the parcel map, shall be substantially completed and operational prior to, and as a condition precedent to, OWNER requesting and CITY's granting of a final occupancy permit for any buildings to be constructed on the Property within the applicable parcel map. All Infrastructure and Improvements shall be completed as required by the Subdivision Agreement/Parcel Map conditions for Parcel Map No. 20161.

4.3.3 C
onstruction of Public Infrastructure by Third Parties . CITY and OWNER acknowledge that a portion of the Improvements described in Exhibit E and depicted in Exhibit F are necessary for the development of surrounding properties within the Ontario Ranch and the other property owners are also obligated to construct the Improvements or portions thereof. As such, CITY agrees that OWNER's obligation to construct the Improvements may be satisfied by third party owners pursuant to separate written agreements between OWNER and said third party undertaking the construction of the Improvements. Nothing in this Agreement shall be construed to prohibit the coordination of the construction of the Improvements between private parties, including the allocation of costs for the construction of the Improvements. Notwithstanding anything to the contrary herein, any applicabl e DIF Credits may be transferred and assigned from one (1) party to another with respect to the construction of the Improvements and such transfer or assignment shall not require the conveyance of any real property. 952
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20 4.3.4 Availability and Use of Recycled Water . OWNER agrees that recycled water shall be available and utilized by OWNER for all construction- related water uses including prior to, and during, any grading of the Property. OWNER and CITY agree that OWNER may, in -lieu of utilizing recycled water during grading and construction, utilize water from existing agricultural wells on the Property subject to the terms of a separate Well Use Agreement between the CITY and OWNER.

4.3.5 C onstruction of DIF Program Infrastructure. To the extent OWNER is required to construct and completes construction of public improvements that are included in CITY's Development Impact Fee Program CITY agrees that CITY shall issue DIF Credit in accordance with the provisions of a separate Fee Credit Agreement between CITY a nd OWNER. Limitations 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. OWNER may be eligible to receive DIF Credit from OWNER's construction of DIF Program Infrastructure. Any such DIF Credit shall be subject to a Fee Credit Agreement between CITY and OWNER. CITY and OWNER agree that the Fee Credit Agreement between CITY and OWNER shall comply with CITY's adopted policies applicable to such agreements.

4.4 Public Services Funding Fee.

4.4.1 Requirement for Payment of Public Services Funding Fee. In order to ensure that the adequate provision of public services, including without limitation, police, fire and other public safety services, are available to each Project in a timely manner, OWNER shall pay to CITY a "Public Services Funding Fee." The Public Services Funding Fee shall apply to residential and non-residential uses as set forth below.

4.4.2 Public Services Funding Fee Amount.

OWNER shall pay a Public
Services Funding fee in a single installment payment in the amount of Seventy-Five Cents ($.75) per square foot of each non- residential building. The single installment for non- residential uses shall be due and payable on a building- by-building basis prior to the issuance of the building permit for a non -residential building. The amount of the Single Installment for non-residential uses shall automatically increase by percentage increase (but no decrease) in the Consumer Price Index ( Riverside – San Bernardino – Ontario, CA), (December 2017=100) over the preceding year on January 1 st of each year, beginning on January 1, 20 24. OWNER may exercise the option to pay any single installment amounts for the remainder of the non- residential square footage within the Project on or before December 31st, before the Single Installment amount is automatically increased.

4.5 Water Availability.

21 Improvements (as described in Exhibit E) , the Phase 2A Water Improvements, and the Interim Chino Avenue Loop depicted in Exhibit F. OWNER acknowledges and agrees that the CITY shall not issue final certificates of occupancy for the Project until the completion of the Potable Water Improvements (as described in Exhibit E), the Phase 2A Water Improvements and the Interim Chino Avenue Loop, as depicted in Exhibit F. OWNER further acknowledges and agrees the Property requires the Phase 2 Water Improvements as depicted in Exhibit F.

4. 5.2 Phase 2 Water Construction Fee. Prior to CITY’s issuance of a grading permit for any parcel of the Property (each, a “Grading Permit”) , OWNER shall pay to CITY the applicable Phase 2 Water Construction Fee. The Phase 2 Water Construction Fee shall be calculated based on the following formula: (a) the regional water development impact fee, based on the square footage of developable proper ty and the approved land use category for each Phase of the Project (the “Base Regional Water DIF”), PLUS (b) OWNER’s pro rata share of the difference between the total projected cost of construction of the Phase 2 Water Improvements (the “Pro Rata Share”) and the Base Regional Water DIF . To determine the Pro Rata Share, which may fluctuate over time, CITY shall, a t the time OWNER applies for a Grading Permit, calculate the total projected cost of construction of the Phase 2 Water Improvements and subtract from that amount (y) all Phase 2 Water Construction Fees previously collected and (z) the aggregate Base Regional Water DIF to be paid by OWNER and all developers then at that time obligated to pay a Base Regional Water DIF specifically for use of the Phase 2 Water Improvements (together, the “Phase 2 Water Developers”). If the difference is zero or a number less than zero, then there is no Pro Rata Share and the Phase 2 Water Construction Fee shall equal the sum of all Base Regional Water DIF to be paid by all Phase 2 Water Developers. If the difference results in a positive number, the funding gap (the “Funding Gap”) shall be divided by the total acreage of land to be developed by the Phase 2 Water Developers to obtain a Funding Gap “per acre” amount (the “Funding Gap Per Acre Amount”). Each Phase 2 Water Developer’s respective total acreage to be developed shall then be multiplied by the Funding Gap Per Acre Amount to obtain each Phase 2 Water Developer’s Pro Rata Share, which will then be added to each Phase 2 Water Developer’s Base Regional Water DIF to obtain the Phase 2 Water Construction Fee due and payable at the time of issuance of the applicable Grading Permit.

4.5.3 DIF Credit for Phase 2 Water Construction Fees. Within thirty (30) days of OWNER's payment of each Phase 2 Water Construction Fee, CITY shall issue a certificate of DIF Credit which may be used to offset OWNER's DIF obligations in the Regional Water DIF Category. The form of the Certificate of DIF Credit shall be as described in Exhibit G, attached hereto and incorporated herein. OWNER acknowledges that any Regional Water DIF Credit issued to OWNER shall not be used to satisfy Phase 2 Water Construction Fees and may only be used to offset OWNER’s DIF obligations in the Regional Water DIF Category.

4. 5. 4 Additional Contributions for Phase 2 Water Improvements . OWNER acknowledges and agrees that, as of the Effective Date of this Agreement, the CITY does not have sufficient funding to construct and complete the Phase 2 Water Improvements.

OWNER agrees to provide the CITY with additional contributions for the Phase 2 Water 954
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22 Improvements prior to the issuance of a Grading Permit for any Phase within the Project, pursuant to the Pro Rata Share calculation as set forth in Section 4.5.2 above. OWNER acknowledges and agrees that the CITY has the right to conduct subsequent review s of the available funding for the construction of, or continuation of the construction of, the Phase 2 Water Improvements. If at any time outside of OWNER’s submission of a request for a Grading Permit the CITY determines that there is not sufficient funding for the construction of, or continuation of the construction of, the Phase 2 Water Improvements necessary to support current and anticipated future development within the Ontario Ranch area served by the Phase 2 Water Improvements, OWNER agrees to pay such subsequent additional contribution payment necessary from the OWN ER (on a pro rata basis with other Phase 2 Water Developers then existing at the time) to the CITY to initiate construction of, or continue construction of, the Phase 2 Water Improvements. The CITY shall determine OWNER’s additional contribution amount (above and beyond OWNER’s Pro Rata Share) and such amount shall be due and payable to the CITY within thirty (30) days of written notice from the CITY to OWNER.

4. 5.5 Future Reimbursement of Pro Rata Share of Phase 2 Water Construction Fees. OWNER agrees that the CITY will be responsible for the construction and completion of the Phase 2 Water Improvements, as depicted in Exhibit F. Subject to the successful completion of the Phase 2 Water Improvements, CITY and OWNER shall meet periodically and/or as needed from the date of completion of the Phase 2 Water Improvements, to jointly develop a plan and mutually enter into an agreement for the reimbursement of OWNER’s Pro Rata Share of Phase 2 Water Construction Fees that may be reimbursed from future development in the 925 Zone as depicted in the City’s Domestic Water Master Plan, following any reallocation of each Phase 2 Water Developer’s Pro Rata Share, CITY’s collection of additional Regional Water DIF in connection with construction of the Phase 2 Water I mprovements, and after the completion of the Phase 2 Water Improvements. Such agreement shall be approved at the sole discretion of the Ontario City Council.

4.6 Compliance with Public Benefits Requirements.

4.6.1 Failure to Provide Public Benefits. In the event OWNER fails or refuses to comply with any condition referenced in Section 4.1 through 4. 5, or challenges (whether administratively or through legal proceedings) the imposition of such conditions, OWNER shall be deemed in default of this Agreement, thereby entitling CITY to any and all remedies available to it, including, without limitation, the right of CITY to withhold OWNER's Project -related building permits, certificates of occupancy, or discretionary approvals, without liability. Nothing herein shall waive OWNER's right to assert a default (or failure to perform) by CITY has excused OWNER's performance under this Agreement.

5. FINANCING OF PUBLIC IMPROVEMENTS.

23 ($.27) per square foot for non- residential buildings. These amounts shall be subject to an automatic increase at a rate not to exceed four (4%) percent per year. Depending on the fiscal year that the CFD is formed and the CFD tax is levied, the annual special taxes may be higher. CITY shall be the sole and exclusive lead agency in the formation of any CFD, assessment district or other public financing mechanism within the Property ; provided however, that the proceeds of any such CFD, assessment district, or financing mechanism may be used, subject to restrictions that may be imposed by applicable law, for the purposes of acquiring, constructing or maintaining public facilities to be owned or operated by other public agencies, including, without limitation those facilities owned or operated by a school district. In addition to the rights of the CITY pursuant to section 5.1 hereof, CITY shall have the right, but not the obligation, to condition the formation of any CFD, assessment district or other public financing mechanism within the Property on the OWNER mitigating all Project -related impacts to the applicable school district(s) as required by such school district(s). Written evidence by such school district(s) may be required by the CITY as the condition to the formation of any CFD, assessment district or other public financing mechanism within the Property, or any steps preliminary thereto, including, without limitation, the adoption of any resolution of intention to form such CFD, assessment district or other public financing mechanism within the Property. It is not the intent of the parties hereto, by this provision, to prohibit or otherwise limit CITY’s ability to take any and all necessary steps requisite to the formation of the CFD to finance CITY services through annual special taxes as set forth in this Section 5.1. Formation of any CFD, assessment district or other public financing mechanism within the Property, shall be subject to CITY's ability to make all findings required by applicable law and complying with all applicable legal procedures and requirements including, without limitation, CITY's public financing district policies as such policies may be amended from time to time.

Notwithstanding the foregoing, it is acknowledged and agreed by the parties that nothing contained in this Agreement shall be construed as requiring CITY or the City Council to form any such district.

6. [OMITTED]

7. REVIEW FOR COMPLIANCE.

7.1 Periodic and Special Reviews.

7.1.1 Time for and Initiation of Periodic Review . The CITY shall review this Agreement every twelve (12) months from the Effective Date in order to ascertain the good faith compliance by the OWNER with the terms of this Agreement. The OWNER shall submit an Annual Monitoring Report to CITY, in a form acceptable to the City Manager, along with any applicable processing charge within ten (10) days after each anniversary date of the Effective Date of this Agreement. Within fifteen (15) days after the receipt of the Annual Monitoring Report, CITY shall review the Annual Monitoring Report. Prior to the expiration of the fifteen (15) day review period, CITY shall either issue a notice of continuing compliance or a notice of non- compliance and a notice of CITY 's intent to conduct a Special Review pursuant to Sections 7.1.2 through 7.1.6. Issuance of a notice of continuing compliance may be issued by the City Manager or his designee. 956
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24 7.1.2 Initiation of Special Review . A special review may be called either by agreement between the parties or by initiation in one or more of the following ways:
(a) R ecommendation of the Planning staff;
(b) Affirmative vote of at least four (4) members of the Planning Commission; or (c) Affirmative vote of at least three (3) members of the City Council.

7.1.3 N otice of Special Review. The City Manager shall begin the special review proceeding by giving notice that the CITY intends to undertake a special review of this Agreement to the OWNER. 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.

7.1.4 Public Hearing. The Planning Commission shall conduct a hearing at which the OWNER must demonstrate good faith compliance with the terms of this Agreement.

The burden of proof on this issue is upon the OWNER.

7.1.5 Findings Upon Public Hearing. Th
e Planning Commission shall determine
upon the basis of substantial evidence whether or not the OWNER has, for the period under review, complied in good faith with the terms and conditions of this Agreement.

7.1.6 Procedure Upon Findings.
(a) If the Planning Commission finds and determines on the basis of substantial evidence that the OWNER has complied in good faith with the terms and conditions of this Agreement during the period under review, the review for that period is concluded. (b) If the Planning Commission finds and determines on the basis of substantial evidence that the 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 City Council to modify or terminate this Agreement. (c) The OWNER may appeal a determination pursuant to paragraph (b) to the City Council in accordance with the CITY's rule for consideration of appeals in zoning matters generally.

7.2 P
roceedings Upon Modification or Termination. If, upon a finding under Section

7.1.6(b), the CITY determines to proceed with modification or termination of this Agreement, the CITY shall give notice to the property OWNER of its intention so to do.

The notice shall contain:
(a) T
he time and place of the hearing;
(b) A statement as to whether or not the CITY proposes to terminate or to modify this Agreement; and
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25 (c) Other information that the CITY considers necessary to inform the OWNER of the nature of the proceeding.

7.3 H earing on Modification or Termination. At the time and place set for the hearing on modification or termination, the OWNER shall be given an opportunity to be heard.

The 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 the OWNER.

If the City Council finds, based upon substantial evidence in the administrative record, that the OWNER has not complied in good faith with the terms and conditions of the agreement, the City Council may terminate this Agreement or modify this Agreement and impose those conditions to the action it takes as it considers necessary to protect the interests of the CITY. The decision of the City Council shall be final, subject only to judicial review pursuant to Section 1094.5 of the Code of Civil Procedure.

7.4 Certificate of Agreement Compliance.

If, at the conclusion of a Periodic or Special
Review, OWNER is found to be in compliance with this Agreement, CITY 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 City 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, CITY 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 City Council.

8. [ OMITTED]

9. DEFAULT AND REMEDIES.

9.1 R emedies in General . It is acknowledged by the parties that CITY would not have entered into this Agreement if it were to be liable in 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 (i) CITY shall not be liable in damages to OWNER, or to any successor in interest of OWNER, or to any other person, and OWNER covenants not to sue for damages or claim any damages and (ii) OWNER shall not be liable in damages to CITY, or to any other person, and CITY covenants not to sue for damages or claim any damages:
(a) F
or any breach of this Agreement or for any cause of action which arises out of this Agreement; or
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26 (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.

9.2 S
pecific 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) M
oney damages are unavailable against CITY and OWNER as provided in Section 9.1 above.
(b) Due to the size, nature and scope of the P roject, 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.

9.3 R
elease. Except for non- damage remedies, including the remedies of judicial review and of specific performance as provided for in Sections 7.3 and 9.2, respectively,, OWNER, for itself, its successors and assignees, hereby releases the CITY, 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 CITY because it entered into this Agreement or because of the terms of this Agreement.

9.4 T ermination or Modification of Agreement for Default of OWNER . S ubject to the
provisions contained in Sections 7.2 and 7.3 herein, CITY 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, CITY 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 959
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27 within such 60 day period and to diligently proceed to complete such actions and cure such default.

9.5 T ermination of Agreement for Default of CITY . OWNER may terminate this Agreement only in the event of a default by CITY in the performance of a material term of this Agreement and only after providing written notice to CITY of default setting forth the nature of the default and the actions, if any, required by CITY to cure such default a nd, where the default can be cured, CITY 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.

10. THIRD PARTY LITIGATION.

10.1 General Plan Litigation. CITY has determined that this Agreement is consistent with the General Plan, as such 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 wi th CITY's determination. CITY shall have no liability in damages under this Agreement for any failure of CITY to perform under this Agreement or the inability of OWNER to develop the Property as contemplated by the Development Plan or 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.

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

10.3 Indemnity. I
n addition to the provisions of Section 10.2 above, OWNER shall indemnify and hold CITY, 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, to the extent 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 active negligence or sole willful misconduct of CITY . OWNER shall defend, at its expense, including attorneys ' fees, CITY, its officers, agents, employees 960
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28 and independent contractors in any legal action based upon such alleged acts or omissions. CITY may in its discretion participate in the defense of any such legal action.

OWNER’s indemnity obligation shall terminate following CITY’s legal acceptance of (i.e. taking of title to) the Improvements.

10.4 E nvironment Assurances . OWNER shall indemnify and hold CITY, its officers, agents, and employees free and harmless from any liability, to the extent 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 during OWNER'S period of ownership of the Property, including, but not limited to, soil and groundwater conditions caused by OWNER, and OWNER shall defend, at its expense, including attorneys' fees, CITY, its officers, agents and employees in any action based or asserted upon any such alleged act or omission. CITY may in its discretion participate in the defense of any such action.

10.5 Reservation of Rights. W
ith respect to Sections 10.2, 10.3 and 10.4 herein, CITY reserves the right to either (1) approve the attorney(s) which OWNER selects, hires or otherwise engages to defend CITY hereunder, which approval shall not be unreasonably withheld, or (2) conduct its own defense, provided, however, that OWNER shall reimburse CITY forthwith for any and all reasonable expenses incurred for such defense, including attorneys' fees, upon billing and accounting therefor.

10.6 Survival . T
he provisions of this Sections 10.1 through 10.6, inclusive, shall survive the termination of this Agreement.

11. MORTGAGEE PROTECTION.

29 manner specified herein for giving notices, shall be entitled to receive written notification from CITY of any default by OWNER in the performance of OWNER 's obligations under this Agreement.
(c) If CITY timely receives a request from a Mortgagee requesting a copy of any notice of default given to OWNER under the terms of this Agreement, CITY 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 CITY, the performance t hereof shall continue to be a condition precedent to CITY'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 (e) In the event of a default by OWNER, any Mortgagee shall have the right to remedy, or cause to be remedied, such default within sixty (60) days following the later to occur of (i) the date of Mortgagee's receipt of the notice referred to in Section 9.4 above, or (ii) the expiration of the period provided herein for OWNER to remedy or cure such default, and CITY shall accept such performance by or at the insistence of the Mortgagee as if the same had been timely made by OWNER; provided, however, that (i) if such default is not capable of being cured within the timeframes set forth in this Section and Mortgagee commences to cure the default within such timeframes, then Mortgagee shall have such additional time as is required to cure the default so long as Mortgagee diligently prosecutes the cure to completion and (ii) if possession of the Property (or portion thereof) is required to effectuate such cure or remedy, the Mortgagee shall be deemed to have timely cured or remedied if it commences the proceedings necessary to obtain possession thereof within sixty (60) days after receipt of the copy of the notice, diligently pursues such proceedings to completion, and, after obtaining possession, diligently completes such cure or remedy.

12. M
ISCELLANEOUS PROVISIONS.

12.1 Recordation of Agreement. This Agreement and any amendment or cancellation thereof shall be recorded with the San Bernardino County Recorder by the City Clerk within ten (10) days after the CITY executes 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 CITY 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 962
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30 faith with the terms or conditions of this Agreement, the City Clerk shall have notice of such action recorded with the San Bernardino County Recorder.

12.2 E ntire 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.

12.3 Severability. I
f 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 CITY 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.

12.4 Interpretation and Governing Law . T
his 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.

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

12.6 Singular and Plural. A s used herein, the singular of any word includes the plural.

12.7 Joint and Several Obligations . Pursuant to Section 2.4, if at any time during the term of this Agreement the Property is subsequently owned, in whole or in part, by more than one owner, all obligations of such owners under this Agreement shall be joint and several, and the default of any such owner shall be the default of all such owners .

Notwithstanding the foregoing, no owner of a single lot which has been finally subdivided and sold to such owner as a member of the general public or otherwise as an ultimate user shall have any obligation under this Agreement except as provided under Section 4 hereof.

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

12.9 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 963
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31 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.

12.10 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.

12.11 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, governmental orders related to statewide or national pandemics, any third party court actions challenging the Project (including but not limited to writs of mandate, 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.

12.12 Mutual Covenants. T
he 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.

12.13 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.

12.14 Counterparts. T
his 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.

12.15 Jurisdiction and Venue. A
ny 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.

32 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 CITY and OWNER is that of a government entity regulating the development of private property and the owner of such property.

12.17 F urther Actions and Instruments . Each of the parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in t he 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 City Manager may delegate his powers and duties under this Agreement to an Assistant City Manager or other management level employee of the CITY.

12.18 Eminent Domain. N
o provision of this Agreement shall be construed to limit or restrict the exercise by CITY of its power of eminent domain.

12.19 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 shal l 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 O WNER. 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.

12.20 Estoppel Certificate.

Within thirty (30) business 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 CITY all costs incurred by CITY in connection with 965
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33 the issuance of estoppel certificates requested by OWNER under this Section 12.20 prior to CITY's issuance of such certificates.

12.21 A uthority to Execute. The person or persons executing this Agreement on behalf of OWNER 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 OWNER to the performance of its obligations hereunder.

12.22 P
revailing Wage. OWNER, for itself, its successors, and assigns, agrees, covenants, and warrants that the development of the Property, if any, shall comply with all applicable federal and state labor laws (including, without limitation, the requirement under California law to pay prevailing wages and hire apprentices), and all obligations as set forth herein.

12.23 C
ITY makes no representations concerning prevailing wages in compliance with California Labor Code Section 1770 et seq.

12.24 O WNER acknowledges and agrees that it shall be independently responsible for reviewing the applicable laws and regulations with respect to the payment of prevailing wages and complying therewith. OWNER shall bear all risks of payment or non-payment of prevailing wages under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar law.

12.25 The foregoing indemnity shall survive termination of this Agreement and shall continue aft er completion of the construction and development of the Property by OWNER, its successors or assigns. OWNER shall be solely responsible for determining and effectuating compliance with such laws.

12.26 OWNER, ON BEHALF OF ITSELF, ITS SUCCESSORS, AND ASSIGNS, WAIVES

AND RELEASES CITY FROM ANY RIGHT OF ACTION THAT MAY BE AVAILABLE TO OWNER PURSUANT TO LABOR CODE SECTION 1781 OR THE DAVIS BACON ACT. RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION

11.22, OWNER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CO DE SECTION 1542, WHICH READS AS FOLLOWS: A GENERAL RELEASE DOES NOT EXTEND TO

CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR

SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE

RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MAT ERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

12.27 INITIALS. BY INITIALING BELOW, OWNER KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY WITH THE MATTERS WHICH ARE THE SUBJECT OF THE FOREGOING WAIVERS AND RELEASES:
_______________
(Owner's Initials)
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34 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year set forth below.
[SIGNATURES CONTAINED ON FOLLOWING PAGE]
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35 SIGNATURE PAGE

TO DEVELOPMENT AGREEMENT
FILE NO. PDA21-005

"OWNER"

GROVE LAND VENTURE LLC
a Delaware limited liability company

by: RBV Grove, LLC, a Delaware limited
liability company, its managing member

by: REDA Bascom Ventures, LLC, a
Delaware limited liability company, its
managing member

by: Real Estate Development Associates,
LLC, a California limited liability company, its
administrative member

by: Waters Edge Property Group, LLC, a
California limited liability company, its
member
By: ________________________
Jason Krotts
Authorized Signatory

Date: ___________________

ATTEST:

City Clerk, Ontario

APPROVED AS TO FORM:

BEST BEST & KRIEGER, LLP

City Attorney

"CITY"

CITY OF ONTARIO

By:

Scott Ochoa
City Manager

Date: ___________________

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36 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 t his ___ day of ______________, 2023 before
me, , Notary Public, personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the f
oregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature:

(Seal)
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37 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
CO

UNTY OF

I certify under PENALTY OF PERJURY under the laws of the State of California t
hat the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature:

(Seal)

970
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38 EXHIBIT "A"

TO DEVELOPMENT AGREEMENT

Legal Description of Property

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF

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

LOTS 1, 2, 3, 4, 13, 14, 15, 16, 17, 18, 19, 20, 29, 30, 31 AND 32 IN SECTION 20, TOWNSHIP 2 SOUTH, RANGE 7 WEST, SAN BERNARDINO BASE AND

MERIDIAN, ACCORDING TO THE MAP OF THE SUBDIVISION OF RANCHO

SANTA ANA DEL CHINO, IN THE CITY OF ONTARIO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, RECORDED IN BOOK 6, PAGE 15 OF MAPS OF RECORDS OF SAID COUNTY.

APNs: 1054 -071-01, 1054- 071-02, 1054- 081-03, 1054- 091-01, 1054- 091-02, 1054-101-01, 1054-101-02, 1054-231-01, 1054-231-02, 1054-241-01, 1054-241- 02, 1054-311-01, 1054-311-02, 1054-321-01, 1054-321-02.

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39 EXHIBIT "B"

TO DEVELOPMENT AGREEMENT

Map showing Property and its location

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40 EXHIBIT "C"

TO DEVELOPMENT AGREEMENT

Existing Development Approvals

On January 1, 2022, the Planning Commission:

a) Approved Resolution No. PC22-004, recommending the City Council certify the Environmental Impact Report (SCH#2021010318) for the South Ontario Logistics Center Specific Plan (File No. PSP19-001).

b) Approved Resolution No. PC22- 005, recommending the City Council approve the General Plan Amendment (File No. PGPA19-004).

c) Approved Resolution No. PC22- 006, recommending the City Council approve the South Ontario Logistics Center Specific Plan (File No. PSP19- 001).

On March 1, 2022, the City Council:

a) Adopted Resolution No. 2022- 015, certifying the Environmental Impact Report (SCH#2021010318) for the South Ontario Logistics Center Specific Plan.

b) Adopted Resolution No. 2022-016, approving the General Plan Amendment (File No. PGPA19-004).

On March 15, 2022, the City Council:

a) Adopted Ordinance No. 3206, approving the South Ontario Logistics Center Specific Plan (File No. PSP19-001)

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41 EXHIBIT "D"

TO DEVELOPMENT AGREEMENT

Existing Land Use Regulations

These documents are listed for reference only:

1. General Plan Amendment (File No. PGPA19-004)

2. South Ontario Logistics Center Specific Plan (File No. PSP19 -001), Ordinance No. 3206

3. South Ontario Logistic s Center Environmental Impact Report (SCH#2021010318)

4. City of Ontario Municipal Code
a. Six – Sanitation & Health
b. Seven – Public Works
c. Eight – Building Regulations
d. Nine – Development Code
e. Ten – Parks & Recreation

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42 EXHIBIT “E”

TO THE DEVELOPMENT AGREEMENT

DESCRIPTION OF REQUIRED IMPROVEMENTS

OWNER shall design, construct, and complete the following Street, Sewer, Storm Drain, Potable Water, Recycled Water, and Fiber Optic improvements, prior to OWNER’s request for any final certificate of occupancy permit for any building within the Property.

a. WT on Grove Avenue between Eucalyptus Avenue and Merrill Avenue (Local Water DIF Project WT-011).

b. WT on Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.

c. WT on Eucalyptus Avenue between Bon View Avenue and Grove Avenue (Local Water DIF Project WT-011).

d. WT on Eucalyptus Avenue between Grove Avenue and Carpenter Avenue (Regional Water DIF Project, portion of Phase 2A Water).

e. WT on Merrill Avenue between Bon View Avenue and Carpenter Avenue (Local Water DIF Project WT-011).

f. SD onsite detention shall be designed, constructed, and completed by OWNER prior to issuance of the first building permit. However, OWNER is eligible to request from CITY a grading permit prior to the completion of the SD onsite detention.

g. SD on Grove Avenue from Eucalyptus Avenue to Merrill Avenue.

h. SD on Eucalyptus Avenue between Bon View Avenue and Grove Avenue.

i. SD on Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.

j. SD on Merrill Avenue between Euclid Avenue and Grove Avenue. 975
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43 k. SD bleeder line or alternative interim connection at the discretion of the City on Euclid Ave south of Merrill Ave. This shall connect to the SD on Merrill Ave between Euclid Ave and Grove Avenue.

l. Two (2) Debris Separation Baffle Boxes at the intersections of Euclid Avenue and Merrill Avenue, and Merrill Avenue and Grove Avenue.

m. Full half ST improvements on the south half and circulation lane improvements on the north half of Eucalyptus Avenue from Bon View Avenue to Grove Avenue.

n. Full half ST improvements on both sides of Merrill Avenue between Euclid Avenue and Carpenter Avenue.

o. Full half ST improvements on the east side and circulation lane improvements on the west side of Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.

p. Full half ST improvements on the west side and circulation lane improvements on the east side of Grove Avenue between Eucalyptus Avenue and Merrill Avenue.

q. Traffic Signals at Bon View Avenue/Eucalyptus Avenue, at Bon View Avenue/Merrill Avenue, at Eucalyptus Avenue/Grove Avenue, and at Grove Avenue, at the signalized median break that aligns with Merrill Commerce Center Specific Plan.

r. Traffic Signal on Merrill Avenue approximately halfway between Bon View and Grove Avenues.

s. Traffic signal modifications at Euclid Avenue/Merrill Avenue and Euclid Avenue/Eucalyptus Avenue.

t. SW (Western Trunk Sewer) on Euclid Avenue between Kimball Avenue and Merrill Avenue (Regional Sewer DIF Project SW-002).

u. SW (Western Trunk Sewer) on Merrill Avenue between Euclid Avenue and Grove Avenue (Regional Sewer DIF Project SW-002).
v. SW on Bon View Avenue between Merrill Avenue and Eucalyptus Avenue (Local Sewer DIF Project SW-010).
w. SW on Grove Avenue between Merrill Avenue and Eucalyptus Avenue (Local Sewer DIF Project SW-009).

x. RW on Bon View Avenue between Eucalyptus Avenue and Merrill 976
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44 Avenue (Local Water DIF Project WT-016).

y. RW on Merrill Avenue between Campus Avenue and Grove Avenue (Local Water DIF Project WT-016).

z. RW on Grove Avenue between Merrill Avenue and Eucalyptus Avenue (Local DIF Project WT-016).

aa. RW on Eucalyptus Avenue between Bon View Avenue and Grove Avenue (Local DIF Project WT-016).

bb. FO on Eucalyptus Avenue between Bon View Avenue and Grove Avenue.

cc. FO on Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.

dd. FO on Merrill Avenue between Bon View Avenue and Grove Avenue.

ee. FO on Grove Avenue between Eucalyptus Avenue and Merrill Avenue.

a. Phase 2A Water Improvements shall consist of the following:

i. WT on Grove Avenue between Eucalyptus Avenue and Chino Avenue (Regional Water DIF Project WT-010).

b. Interim Chino Avenue Loop shall consist of the following:

i. WT on Chino Avenue between Cucamonga Channel and
Grove Avenue, which will provide the second point of
connection from the 1010 Pressure Zone (Local Water DIF Project WT-009).

ii. Pressure Reducing Station at Grove Avenue and Chino Avenue, which will provide the second point of connection from 1010 Pressure Zone (Future Local Water DIF Project WT-009). 977
46700.10300\33554440.1

45 OWNER shall pay one hundred percent (100%) of the costs to construct the Phase 2A Improvements and the Interim Chino Avenue Loop, within forty-five (45) days from the Effective Date of this Agreement, and such payment shall be the “Phase 2A Water Payment”. The costs in the foregoing sentence shall equal the actual bid amount of the awarded contracts for the work, plus fifteen percent (15%). Upon OWNER’s full and complete payment to CITY, the CITY shall issue a Certificate of DIF Credit in the Regional Water category and/or the Local Adjacent Water category, as appropriate. Each DIF Water Certificate shall be issued by CITY within thirty (30) days of the receipt of such required payment.

CITY shall not issue any building permits until receipt of the full Phase 2A Water Payment.

c. Phase 2B Water Improvements shall consist of the following:

i. WT on Francis Street between Grove Avenue and Bon View Avenue (Regional Water DIF Project WT-010).

ii. WT on Bon View Avenue between Francis Street and the Bon View Reservoir Site (Regional Water DIF Project WT-010).

iii. WT – Nine (9) Million Gallon reservoir at Bon View Reservoir Site (Regional Water DIF Project WT-014).

iv. WT – Two (2) Groundwater Production Wells in vicinity of Bon View Reservoir Site (Regional Water DIF Project WT-007).

v. WT on Grove Avenue between Chino Avenue and Francis
Street (Regional Water DIF Project WT-010). The final design and alignment north of Riverside Drive is subject to change at the reasonable discretion of the CITY.

The Phase 2B Water Improvements will be constructed by the CITY and funded by OWNER, pursuant to Section 4.5 of this Agreement .

CITY and OWNER mutually agree and understand, that with completion of Phase 2A and the Interim Chino Avenue Loop, the project will be utilizing interim water supply and storage capacity from the 1010’ Pressure Zone and OWNER will be required to participate in the funding of future Phase 2 Water Improvements to support the permanent water supply and storage needs of future development within Ontario Ranch.

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46 EXHIBIT "F"

TO DEVELOPMENT AGREEMENT

Required Infrastructure Improvements

(SEE ATTACHED EXHIBITS)
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47 980
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48 981
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49 982
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50 983
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51 984
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52 985
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53 986
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54 Exhibit "G"

FORM OF CERTIFICATE OF REGIONAL DIF CREDIT

Pursuant to Section 4.5. 3
of this Agreement by and between the City of
Ontario and ____________________, dated _______________, 20 , the terms and definitions of which are hereby incorporated herein by this reference and hereinafter called the " Development Agreement ', the City o f Ontario hereby certifies that OWNER is entitled to the following amount and nature of DIF Credits in the Regional Water DIF Infrastructure Category:

Amount of Credit: $

Scott Ochoa, City Manager
Dated:

987
ORDINANCE NO. _______

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ONTARIO, CALIFORNIA, APPROVING FILE NO. PDA21-005, A DEVELOPMENT

AGREEMENT BETWEEN THE CITY OF ONTARIO AND GROVE LAND

VENTURE LLC, TO ESTABLISH THE TERMS AND CONDITIONS
ASSOCIATED WITH TENTATIVE PARCEL MAP 20161 (FILE NO.

PMTT20-011), A 159.95 ACRE PROPERTY BORDERED BY

EUCALYPTUS AVENUE TO THE NORTH, BON VIEW AVENUE TO THE

WEST, MERRILL AVENUE TO THE SOUTH, AND GROVE AVENUE TO

THE EAST, WITHIN THE INDUSTRIAL AND BUSINESS PARK LAND USE

DISTRICTS OF THE SOUTH ONTARIO LOGISTICS CENTER SPECIFIC PLAN (FILE NO. PSP19-001) AND MAKING FINDINGS IN SUPPORT THEREOF - APNS: 1054-071-01, 1054-071-02, 1054-081-03,
1054-091-01, 1054-091-02, 1054-101-01, 1054-101-02, 1054-231-01, 1054-231-02, 1054-241-01, 1054-241-02, 1054-311-01, 1054-311-02, 1054-321-01 AND 1054-321-02.

WHEREAS, Grove Land Venture LLC ("Applicant") has filed an Application for the approval of a Development Agreement, File No. PDA21-005, as described in the title of this Resolution (hereinafter referred to as "Application" or "Project"); and WHEREAS, the Application applies to 159.95 acres of land generally bordered by Eucalyptus Avenue to the north, Bon View Avenue to the west, Merrill Avenue to the south, and Grove Avenue to the east, within the Industrial and Business Park land use districts of the South Ontario Logistics Center Specific Plan; and WHEREAS, the Applicant has submitted a Tentative Parcel Map 20161 (File No.

PMTT20-011) to subdivide 159.95 acres of land into 10 parcels, to facilitate the potential development of 5,333,518 square feet of business park and industrial uses; and WHEREAS, the environmental impacts of this project were previously reviewed in conjunction with the South Ontario Logistic Center Specific Plan (File No. PSP19-001), for which an Environmental Impact Report - State Clearinghouse No. 2021010318 - (hereinafter referred to as "Certified EIR") was adopted by the City Council on March 1, 2022, and this Application introduces no new significant environmental impacts; and WHEREAS, the City's "Local Guidelines for the Implementation of the California Environmental Quality Act (CEQA)" provide for the use of a single environmental assessment in situations where the impacts of subsequent projects are adequately analyzed; and
WHEREAS, Ontario Development Code Table 2.02-1 (Review Matrix) grants the City Council the responsibility and authority to review and act on the subject Application; and
988
WHEREAS, the Project is located within the Airport Influence Area of Ontario International Airport ("ONT"), which encompasses lands within parts of San Bernardino, Riverside, and Los Angeles Counties, and is subject to, and must be consistent with, the policies and criteria set forth in the Ontario International Airport Land Use Compatibility Plan (ALUCP), which applies only to jurisdictions within San Bernardino County, and addresses the noise, safety, airspace protection, and overflight impacts of current and future airport activity; and
WHEREAS, City of Ontario Development Code Division 2.03 (Public Hearings) prescribes the manner in which public notification shall be provided and hearing procedures to be followed, and all such notifications and procedures have been completed; and
WHEREAS, the Project has been reviewed for consistency with the Housing Element of the Policy Plan component of The Ontario Plan, as State Housing Element law (as prescribed in Government Code Sections 65580 through 65589.8) requires that development projects must be consistent with the Housing Element, if upon consideration of all its aspects, it is found to further the purposes, principals, goals, and policies of the Housing Element; and
WHEREAS, on April 25, 2023, the Planning Commission of the City of Ontario conducted a hearing to consider the Project, and concluded said hearing on that date, voting to issue Resolution No. PC23-032 recommending the City Council approve the Application; and
WHEREAS, on May 16, 2023, the City Council of the City of Ontario conducted a hearing to consider the Project, and concluded said hearing on that date; and WHEREAS, all legal prerequisites to the adoption of this Resolution have occurred.

NOW, THEREFORE, IT IS HEREBY FOUND, DETERMINED, AND ORDAINED by the City Council of the City of Ontario, as follows:

SECTION 1. Environmental Determination and Findings. As the decision-making body for the Project, the City Council has reviewed and considered the information contained in the administrative record for the Project. Based upon the facts and information contained in the administrative record, including all written and oral evidence presented to the City Council, the City Council finds as follows:
(1) The environmental impacts of this project were previously reviewed in conjunction with the South Ontario Logistics Center Specific Plan (File No. PSP19-001), for which a Certified EIR was adopted by the City Council on March 1, 2022; 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
989
(4) The previous Certified EIR reflects the independent judgment of the Planning Commission; and
(5) The proposed 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 2. Subsequent or Supplemental Environmental Review Not Required. Based on the information presented to the City Council and the specific findings set forth in Section 1, above, the City 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 the 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 City 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 City declined to adopt.

SECTION 3. Housing Element Compliance. Pursuant to the requirements of California Government Code Chapter 3, Article 10.6, commencing with Section 65580, as the recommending authority for the Project, the Planning Commission finds that based on the facts and information contained in the Application and supporting documentation, at the time of Project implementation, the project is consistent with the Housing Element of the Policy Plan (General Plan) component of The Ontario Plan, as the project site is not one of the properties in the Housing Element Sites Inventory contained in Tables B-1 and B-2 of the Housing Element Technical Report.
990
SECTION 4. Airport Land Use Compatibility Plan ("ALUCP") Compliance.

The California State Aeronautics Act (Public Utilities Code Section 21670 et seq.) requires that an Airport Land Use Compatibility Plan be prepared for all public use airports in the State; and requires that local land use plans and individual development proposals must be consistent with the policies set forth in the adopted Airport Land Use Compatibility Plan.
(1) On April 19, 2011, the City Council of the City of Ontario approved and adopted the Ontario International Airport Land use Compatibility Plan, establishing the Airport Influence Area for Ontario International Airport, which encompasses lands within parts of San Bernardino, Riverside, and Los Angeles Counties, and limits future land uses and development within the Airport Influence Area, as they relate to noise, safety, airspace protection, and overflight impacts of current and future airport activity. As the decision-making body for the Project, the City Council has reviewed and considered the facts and information contained in the Application and supporting documentation against the ONT ALUCP compatibility factors, including [1] Safety Criteria (ONT ALUCP Table 2-2) and Safety Zones (ONT ALUCP Map 2-2), [2] Noise Criteria (ONT ALUCP Table 2-3) and Noise Impact Zones (ONT ALUCP Map 2-3), [3] Airspace protection Zones (ONT ALUCP Map 2-4), and [4] Overflight Notification Zones (ONT ALUCP Map 2-5). As a result, the DAB, therefore, finds and determines that the Project, when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the ONT ALUCP; and
(2) On August 2, 2022, the City Council of the City of Ontario approved and adopted a Development Code Amendment to establish the Chino Airport ("CNO") Overlay Zoning District ("OZD") and Reference I, Chino Airport Land Use Compatibility Plan ("CNO ALUCP"). The CNO OZD and CNO ALUCP established the Airport Influence Area for Chino Airport, solely within the City of Ontario, and limits future land uses and development within the Airport Influence Area, as they relate to safety, airspace protection, and overflight impacts of current and future airport activity. The CNO ALUCP is consistent with policies and criteria set forth within the Caltrans 2011 California Airport Land Use Planning Handbook. The proposed Project is located within the Airport Influence Area of Chino Airport and was evaluated and found to be consistent with the California Airport Land Use Planning Handbook and the CNO ALUCP. As the decision- making body for the Project, the City Council has reviewed and considered the facts and information contained in the Application and supporting documentation against the CNO ALUCP compatibility factors, including Safety, Airspace Protection, Overflight. As a result, the DAB, therefore, finds and determines that the Project, when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the California Airport Land Use Planning Handbook and the Chino ALUCP.

SECTION 5. Concluding Facts and Reasons. Based upon the substantial evidence presented to the City Council during the above-referenced hearing, and upon the specific findings set forth in Section 1 through 4, above, the City Council hereby concludes as follows:
991
(1) The Development Agreement applies to approximately 159.95 acres of land bordered by Eucalyptus Avenue to the north, Bon View Avenue to the west, Merrill Avenue to the south, and Grove Avenue to the east, within the Industrial and Business Park land use districts of the South Ontario Logistics Center Specific Plan (File No.

PSP19-001); and
(2) The Development Agreement establishes parameters for the development of land within the South Ontario Logistics Center Specific Plan. The Development Agreement also grants the Applicant, the right to develop, the ability to quantify the fees; and establish the terms and conditions that apply to those projects. These terms and conditions are consistent with The Ontario Plan Policy Plan (General Plan), design guidelines and development standards for the South Ontario Logistics Center Specific Plan; and
(3) The Development Agreement grants the Owner a vested right to develop Tentative Parcel Map 20161 (File No. PMTT20-011) as long as the Owner complies with the terms and conditions of the Specific Plan and EIR. Tentative Parcel Map 20161 is bordered by Eucalyptus Avenue to the north, Bon View Avenue to the west, Merrill Avenue to the south, and Grove Avenue to the east, and proposes to subdivide 159.95 acres of land into 10 parcels, to facilitate the potential development of 5,333,518 square feet of business park and industrial uses; and
(4) The Development Agreement has been prepared in conformance with the goals and policies of The Ontario Plan Policy Plan (General Plan); and (5) The Development Agreement does not conflict with the Land Use Policies of The Ontario Plan Policy Plan (General Plan) and will provide for development, within the district, in a manner consistent with the Policy Plan and with related development; and
(6) This Development Agreement will promote the goals and objectives of the Land Use Element of the Policy Plan; and
(7) This Development Agreement will not be materially injurious or detrimental to the adjacent properties and will not have a significant impact on the environment or the surrounding properties. The environmental impacts of this project were previously reviewed in conjunction with the South Ontario Logistics Center Specific Plan (File No.

PSP19-001), for which an Environmental Impact Report (State Clearinghouse No. 2021010318) was certified by City Council on March 1, 2022; and (8) This Application introduces no new significant environmental impacts. All previously adopted mitigation measures are a condition of project approval and are incorporated herein by this reference.

SECTION 6. City Council Action. Based upon the findings and conclusions set forth in Sections 1 through 5, above, the City Council hereby APPROVES the herein described Development Agreement (File No. PDA21-005), attached hereto as "Attachment A," and incorporated herein by this reference. 992
SECTION 7. Indemnification. The Applicant shall agree to defend, indemnify and hold harmless, the City of Ontario or its agents, officers, and employees from any claim, action or proceeding against the City of Ontario or its agents, officers or employees to attack, set aside, void, or annul this approval. The City of Ontario shall promptly notify the applicant of any such claim, action, or proceeding, and the City of Ontario shall cooperate fully in the defense.

SECTION 8. Custodian of Records. The documents and materials that constitute the record of proceedings on which these findings have been based are located at the City of Ontario City Hall, 303 East "B" Street, Ontario, California 91764. The custodian for these records is the City Clerk of the City of Ontario.

SECTION 9. Severability. If any section, sentence, clause or phrase of this Ordinance or the application thereof to any entity, person or circumstance is held for any reason to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect other provisions or applications of this Ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this Ordinance are severable. The People of the City of Ontario hereby declare that they would have adopted this Ordinance and each section, sentence, clause or phrase thereof, irrespective of the fact that any one or more section, subsections, sentences, clauses or phrases be declared invalid or unconstitutional.

SECTION 10. Effective Date. This Ordinance shall become effective 30 days following its adoption.

SECTION 11. Publication and Posting. The Mayor shall sign this Ordinance and the City Clerk shall certify as to the adoption and shall cause a summary thereof to be published at least once, in a newspaper of general circulation in the City of Ontario, California within 15 days following the adoption. The City Clerk shall post a certified copy of this ordinance, including the vote for and against the same, in the Office of the City Clerk, in accordance with Government Code Section 36933.

PASSED, APPROVED, AND ADOPTED this ____ day of _________ 2023. _____________________________________
PAUL S. LEON, MAYOR
ATTEST:
_________________________________

SHEILA MAUTZ, CITY CLERK
993
APPROVED AS TO FORM:
_______________________________

BEST BEST & KRIEGER LLP

CITY ATTORNEY
994

STATE OF CALIFORNIA )

COUNTY OF SAN BERNARDINO )

CITY OF ONTARIO )
I, SHEILA MAUTZ, City Clerk of the City of Ontario, DO HEREBY CERTIFY that foregoing Ordinance No. _______ was duly introduced at a regular meeting of the City Council of the City of Ontario held _____________ and adopted at the regular meeting held ___________, 20___ by the following roll call vote, to wit:

AYES: COUNCIL MEMBERS:

NOES: COUNCIL MEMBERS:

ABSENT: COUNCIL MEMBERS:
_________________________________

SHEILA MAUTZ, CITY CLERK
(SEAL)
I hereby certify that the foregoing is the original of Ordinance No. _______ duly passed and adopted by the Ontario City Council at their regular meeting held ____________ and that Summaries of the Ordinance were published on ___________ and _____________, in the Inland Valley Daily Bulletin newspaper.
__________________________________

SHEILA MAUTZ, CITY CLERK
(SEAL)
995
ATTACHMENT A:

File No. PDA21-005

DEVELOPMENT AGREEMENT
By and Between

CITY OF ONTARIO
a California municipal corporation
and

GROVE LAND VENTURE LLC
a Delaware limited liability company
(Development Agreement to follow this page)
996
1 RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

CITY OF ONTARIO

DEVELOPMENT AGREEMENT
By and Between

CITY OF ONTARIO
a California municipal corporation
and
GROVE LAND VENTURE, LLC.
a Delaware limited liability company
______________, 2023
San Bernardino County, California
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2 DEVELOPMENT AGREEMENT NO. PDA21-005
This Development Agreement (hereinafter "Agreement") is dated for reference purposes only as of the ____ day of ____________, 2023 by and among the City of Ontario, a California municipal corporation (hereinafter "CITY"), and Grove Land Venture, LLC.,, a Delaware limited liability company (hereinafter "OWNER"):

4.01.015 of the Ontario Development Code; and
WHEREAS, OWNER has requested CITY to enter into a development agreement and proceedings have been taken in accordance with the rules and regulations of CITY; and
WHEREAS, by electing to enter into this Agreement, CITY shall bind future City Councils of CITY by the obligations specified herein and limit the future exercise of certain governmental and proprietary powers of CITY; and
WHEREAS, the terms and conditions of this Agreement have undergone extensive review by CITY and the City Council and have been found to be fair, just and reasonable; and
WHEREAS, the best interests of the citizens of the CITY and the public health, safety and welfare will be served by entering into this Agreement; and WHEREAS, all of the procedures of the California Environmental Quality Act, Pub.

Res. Code § 21000, et seq. (“CEQA”) have been met with respect to the Project and the Agreement in that certain South Ontario Logistics Center Specific Plan Environmental Impact Report (State Clearinghouse No. 2021010318) (the "FEIR"); and WHEREAS, on March 1, 2022, the City Council found and determined that the FEIR was prepared in accordance with the requirements of CEQA and adequately describes the impacts of the Project described in the FEIR, which included consideration of this Agreement; and
WHEREAS, this Agreement and the Project are consistent with the CITY's Comprehensive General Plan and the South Ontario Logistics Center Specific Plan; and WHEREAS, all actions taken and approvals given by CITY 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 Project Site, as more particularly described and depicted in Exhibits A and B, respectively (the "Property") in accordance with this 998
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3 Agreement will provide substantial benefits to CITY and will further important policies and goals of CITY; 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 Section 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.

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 "CITY" means the City of Ontario, California, a California municipal corporation.

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 public 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 Approvals" means all permits and other entitlements for use subject to approval or issuance by CITY in connection with development of the Property including, but not limited to:
(a) general plans and general plan amendments; and specific plans and specific plan amendments;
(b) tentative and final subdivision and parcel maps;
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4 (c) development plan review.

1.1.5 "Development Exaction" means any requirement of CITY 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.

1.1.6 "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, and, for purposes of this Agreement only, includes fees collected under development agreements adopted pursuant to Article 2.5 of the Government Code (commencing with Section 65864) of Chapter 4. For purposes of this Agreement only, "Development Impact Fee" shall not include processing fees and charges imposed by CITY to cover the estimated actual costs to CITY 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.

1.1.7 "Development Plan" means the Existing Development Approvals and the Existing Land Use Regulations applicable to development of the Property.

1.1.8 "Effective Date" means the date that the ordinance approving this Agreement goes into effect.

1.1.9 "Existing Development Approvals" means all Development Approvals approved or issued on or 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.

1.1.10 "Existing Land Use Regulations" means all Land Use Regulations in effect on the date of the first reading of the ordinance adopting and approving this Agreement. 1000
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5 Existing Land Use Regulations includes the Regulations incorporated herein as Exhibit "D" and all other Land Use Regulations that are in effect and a matter of public record on such date.

1.1.11 "General Plan" means The Ontario Plan adopted August 16, 2022, as amended up to the date of the first reading of the ordinance adopting and approving this Agreement.

1.1.13 "Land Use Regulations" means all ordinances, resolutions, codes, rules, regulations and official policies of CITY 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 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 CITY 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 that provide for the use of or the entry upon public property; (e) the exercise of the power of eminent domain.

1.1.14 "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.

1.1.15 "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 “Phase” means the development area described in the Infrastructure Improvements Exhibit to this Agreement.
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6 1.1.18 “Phase 2 Water Participation Fee” means the fee paid to the CITY for the Project, to fund the Property’s respective share of the project costs of the design and construction of the Phase 2 Water Improvements by the CITY. The Phase 2 Water Participation Fee shall be the calculated amount of the Regional Water DIF for the Project based upon the number of square feet, acreage, and land use category for non-residential square footage of the Project.

1.1.19 "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.

1.1.20 "Property" means the real property described on Exhibit "A" and shown on Exhibit "B" to this Agreement.

1.1.21 "Reservations of Authority" means the rights and authority excepted from the assurances and rights provided to OWNER under this Agreement and reserved to CITY under Section 3.4 of this Agreement.

1.1.22 "Specific Plan" means that certain specific plan adopted by the City Council, and entitled, "South Ontario Logistics Center Specific Plan”.

1.1.23 "Subsequent Development Approvals" means all discretionary Development Approvals required subsequent to the Effective Date in connection with development of the Property. Subsequent Development Approvals shall be deemed to be subject to the provisions of this Agreement, without any further action needed on the part of either the CITY or OWNER.

1.1.24 "Subsequent Land Use Regulations" means any discretionary 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" — Description of Required Infrastructure Improvements Exhibit "F" — Depiction of Infrastructure Improvements Exhibits Exhibit "G" – Form of Certificate of DIF Credit to be issued by CITY

2. GENERAL PROVISIONS.
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7 2.1 Binding Effect of Agreement. The Property is hereby made subject to this Agreement. Development of the Property is hereby authorized and shall be carried out only in accordance with the terms of this Agreement.

2.3 Term. The term of this Agreement shall commence on the Effective Date and shall continue for an initial term of ten (10) years thereafter unless this term is modified or extended pursuant to the provisions of this Agreement. Upon approval by the City Manager, without the need for City Council approval, 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 180 days written notice to CITY prior to expiration of the initial term; and
(b) OWNER is not then in uncured default of this Agreement.

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 with respect to the portion of the Property sold and be made in strict compliance with the following:
(a) Except as expressly provided for herein, 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 CITY's City Manager, in writing, of such sale, transfer or assignment and shall provide CITY with: (1) an executed agreement, in a form reasonably acceptable to CITY, 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. (c) 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 1003
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8 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 City 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. (d) Notwithstanding the foregoing, OWNER shall have the right to assign this Agreement to an Owner Affiliate subject to the notice requirements to CITY as described in Paragraph (b) of this Section 2.4.1, above.

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 CITY, which release shall be provided by CITY 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 part of the portion of the Property sold, transferred or assigned.
(b) OWNER is not then in default under this Agreement.
(c) OWNER has provided CITY with the notice and executed an agreement as required under Paragraph (b) of Subsection 2.4.1 above. (d) The purchaser, transferee or assignee provides CITY with security equivalent to any security previously provided by OWNER (if any) to secure performance of its obligations hereunder which are to be performed upon portion of the Property sold, transferred or assigned.

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 2.4.1 and notwithstanding the release 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. 1004
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9 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 (1) year) of any parcel 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 of the parcel. 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 (1) 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 parcel, and the fees set forth under Section 4 of this Agreement have been paid.

2.4.6 Partial Assignment and Assumption. CITY 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 CITY. Any such complete and executed partial assignment and assumption of this Agreement shall be submitted to CITY for approval pursuant to Section 2.4.1 of this Agreement. Within thirty (30) days following such complete submittal, CITY shall review, and if the above conditions are satisfied, may approve the partial assignment and release and notify the purchasor, 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 only in the manner provided for in Government Code Section 65868.1. Any amendment of this Agreement, which amendment has been requested by OWNER, shall be considered by the CITY only upon the payment of the applicable processing charge. This provision shall not limit any remedy of CITY or OWNER as provided by this Agreement. Either party or successor in interest, may propose an amendment to or cancellation, in whole or in part, of this Agreement. Any amendment or cancellation shall be by mutual consent of the parties or their successors in interest except as provided otherwise in this Agreement or in Government Code Section 65865.1. 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 CITY initiates the proposed amendment to, or cancellation of, in whole or in part, this Agreement, CITY shall first give notice to the OWNER of its intention to initiate such proceedings at least sixty (60) days 1005
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10 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 City Zoning Ordinance. It is also contemplated by CITY 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 CITY 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 CITY, 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 CITY or applicable public agency of all required dedications.

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. 1006
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11 (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 CITY:

Scott Ochoa, City Manager
City of Ontario
303 East "B" Street
Ontario, CA 91764
If to OWNER:

Jeff Johnston
Grove Land Venture, LLC.
c/o Real Estate Development Associates
4450 MacArthur Blvd., Suite 100
Newport Beach, CA 92660
[email protected]
with a copy to:

Ruben Duran, City Attorney
Best Best & Krieger, LLP
2855 E Guasti Road
Ontario, CA 91761
With a copy to:

Matt Fogt, Esq.

Allen Matkins Leck Gamble Mallory&
Natsis, LLP
2010 Main Street, 8th Floor
Irvine, CA 92614
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.

3. DEVELOPMENT OF THE PROPERTY.

3.2 Effect of Agreement on Land Use Regulations. Except as otherwise provided under the terms of this Agreement including the Reservations of Authority in Section 3.4, 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 1007
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12 connection with any Subsequent Development Approval, CITY shall exercise discretion in accordance with the same manner as it exercises its 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.

City 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.

3.3.1 Infrastructure Improvement Exhibit. Attached hereto as Exhibits “E” and "F" are a description and depiction, respectively, of the Improvements needed for the development of the Property. In the event of any discrepancy between Exhibit E and Exhibit F, Exhibit F shall control.

3.4 Reservations of Authority.

3.4.1 Limitations, Reservations and Exceptions. Notwithstanding any other provision of this Agreement, the CITY shall not be prevented from applying new rules, regulations and policies upon the OWNER, nor shall a development agreement prevent the CITY 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 by CITY to cover 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 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 CITY and any local amendments to those codes adopted by the CITY; provided however that, OWNER shall have a vested right to develop the Property in accordance with, and to the extent of, the standards and specifications that are expressly identified in the Specific Plan and the building codes in effect as of the Effective Date;
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13 (d) Regulations that may conflict with this Agreement and the Development Plan but that are reasonably necessary to protect the occupants of the Project and/or of the immediate community from a condition perilous to their health or safety; (e) Regulations that do not conflict with those rules, regulations and policies set forth in this Agreement or the Development Plan and which do not impose additional obligations, costs, and expenses on OWNER or the Project; (f) Regulations that may conflict with this Agreement but to which the OWNER consents.

3.4.2 Subsequent Development Approvals. This Agreement shall not prevent CITY, in acting on Subsequent Development Approvals, from applying Subsequent Land Use Regulations that do not conflict with the Development Plan and/or the Existing Development Approvals, nor shall this Agreement prevent CITY from denying or conditionally approving any Subsequent Development Approval on the basis of the Existing Land Use Regulations or any Subsequent Land Use Regulation not in conflict with the Development Plan and/or the Existing Development Approvals.

3.4.3 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 CITY 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 3.4.3 shall impose on CITY any monetary liability for contesting such declaratory relief (or other similar non-monetary relief).

3.4.4 Intent. The parties acknowledge and agree that CITY 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 CITY 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 CITY all such power and authority which cannot be restricted by contract.

3.5 Public Works; Utilities. If OWNER is required by this Agreement or a condition of Project approval to construct any public works facilities which will be dedicated to CITY 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 standards as would be applicable to CITY or such other public agency should it have undertaken such construction. As a condition of development approval, OWNER shall connect the 1009
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14 Project to all utilities necessary to provide adequate water, recycled water, sewer, gas, electric, and other utility services necessary for the Project, as further described and depicted in the Infrastructure Improvements Exhibit. As a further condition of development approval, OWNER shall to the extent possible contract with the CITY for CITY-owned or operated utilities for this purpose, for such price and on such terms as may be available to similarly situated customers in the CITY. As a further condition of development approval, to the extent OWNER does not own the Property in fee simple, OWNER will provide to CITY the written consent from the current fee owner of the Property agreeing to the terms of this Agreement and the recordation thereof, pursuant to Section 2.2.

3.5.1 OWNER agrees that development of the Project shall require the construction of storm drain Improvements from the Property described in Exhibit E and depicted in Exhibit F. OWNER shall be responsible for payment of a fee in-lieu (the “Euclid Avenue Storm Drain In-Lieu Fee) of actual construction of the ultimate Euclid Avenue storm drain Improvements, south of Merrill Avenue, depicted in Exhibit F.

OWNER shall pay the CITY, prior to the request for occupancy of any building on the Property, Four Million Twelve Thousand One Hundred Ninety Dollars ($4,012,190). Upon OWNER’S complete payment of the Euclid Avenue Storm Drain In-Lieu Fee, the CITY shall issue a Certificate of DIF Credit in the Regional Storm Drain category equal to the amount paid to the CITY. Such Regional Storm Drain DIF Certificate shall be issued by CITY within thirty (30) business days of the receipt of such required payment. OWNER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY, and OWNER agrees that OWNER shall not request and CITY shall not issue a final occupancy permit for any buildings prior to payment of the Euclid Avenue Storm Drain In-Lieu Fee and construction of the storm drain Improvements described in Exhibit E and depicted in Exhibit F. CITY and OWNER mutually acknowledge and agree, that upon OWNER’s complete payment of the Euclid Avenue Storm Drain In-Lieu Fee, such obligation shall be deemed satisfied and CITY shall not hold up a request for final occupancy permit for any buildings on the Property, based on the actual construction and completion of the ultimate Euclid Avenue storm drain Improvements. CITY agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building- by-building basis prior to completion of the storm drain improvements.

3.5.2 OWNER agrees that development of the Project shall require the construction of street Improvements as described in Exhibit E and depicted in Exhibit F.

OWNER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY, and OWNER agrees that OWNER shall not request, and CITY shall not issue a final occupancy permit for any buildings on the Property prior to Substantial Completion of the street Improvements as described in Exhibit E and depicted in Exhibit F. For purposes of the foregoing, street Improvements shall be deemed "Substantially Complete" even if the final lift of pavement has not been completed (i.e., OWNER may install the final lift after completion of all other construction). CITY agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building-by-building basis prior to completion and subject to final acceptance by CITY of 1010
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15 the street Improvements. OWNER agrees that the street improvements shall be completed and subject to final acceptance by CITY prior to the release of any security for the construction of the street improvements. OWNER and CITY agree that a portion of the street Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others, or pursuant to a cooperative agreement with others. If such street Improvements are constructed by others, or in cooperation with others, and are completed and accepted by CITY prior to OWNER's request to CITY of the required grading, building or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those street Improvements constructed and completed by others and accepted by CITY.

3.5.3 OWNER agrees that development of the Property shall require the construction of water utility Improvements as described in Exhibit E and depicted in Exhibit F consisting generally of the construction of the potable water Improvements to serve the Property as described in Exhibit E and depicted in Exhibit F. OWNER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY upon completion of sufficient water improvements to serve the Property from at least one point of connection. OWNER and CITY agree that OWNER may, in-lieu of utilizing recycled water during grading and construction, utilize water from existing agricultural wells on the Property subject to the terms of a separate Well Use Agreement between the CITY and OWNER. OWNER agrees that OWNER shall not request and CITY shall not issue a final occupancy permit for any buildings on the Property until the completion of the potable water improvements described in Exhibit E and depicted in Exhibit F. City agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building-by-building basis prior to completion of the water improvements if there is available permanent water service from a minimum of two (2) points of connection and sufficient water is available for fire protection purposes for any buildings while under construction. OWNER and CITY agree that a portion of the water Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others, or pursuant to a cooperative agreement with others. If such water Improvements are constructed by others, or in cooperation with others, and are completed and accepted by CITY prior to OWNER's request to CITY of the required grading, building or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those water Improvements constructed and completed by others and accepted by CITY.

3.5.4 OWNER agrees that development of the Property shall require the construction of sewer Improvements as described in Exhibit E and depicted in Exhibit F.

OWNER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY, and OWNER agrees that OWNER shall not request and CITY shall not issue a final occupancy permit for any buildings prior to completion of the sewer improvements described in Exhibit E and depicted in Exhibit F. CITY agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building- by-building basis prior to the completion of the sewer improvements described in Exhibit E and depicted in Exhibit F. OWNER and CITY agree that a portion of the sewer 1011
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16 Improvements described in Exhibit E and depicted in Exhibit F may be constructed by others, or pursuant to a cooperative agreement with others. If such sewer Improvements are constructed by others, or in cooperation with others, and are completed and accepted by CITY prior to OWNER's request to CITY of the required grading, building or other required permits for OWNER to initiate construction of structures for the Property, then OWNER shall not be required to construct those sewer Improvements constructed and completed by others and accepted by CITY.

3.5.6 OWNER agrees that development of the Property shall require the construction of fiber optic communications infrastructure, at OWNER's sole cost and expense, as described in the attached Exhibit E and depicted in Exhibit F consisting generally of the construction of fiber optic communications infrastructure to serve the Property. OWNER and CITY agree that CITY may issue grading, building and other required permits for OWNER to initiate construction of structures for the Property according to plans approved by CITY and OWNER agrees that OWNER shall not request and CITY shall not issue a final occupancy permit for any buildings prior to completion of the fiber optic communications infrastructure, as described in Exhibit E and depicted in Exhibit F. CITY agrees that OWNER may request that CITY issue temporary certificates of occupancy on a building-by-building basis prior to the completion of the fiber optic communications infrastructure, as described in Exhibit E and depicted in Exhibit F. 1012
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17 3.6 Acquisition of Offsite Provision of 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 ("Offsite Improvements"), the CITY and OWNER shall cooperate in acquiring the necessary legal interest ("Offsite Property") as described below in Section 3.7. This Section 3.6 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 CITY upon the development of the Project under the Subdivision Map Act or other legal authority.

3.7 Real Property Interests.

3.7.1 CITY Acquisition of Offsite Property. In the event OWNER is required to construct any public improvements on land not owned by OWNER, Sections 3.7.1 and

3.7.2 shall control the acquisition of the Offsite Property. If the OWNER is unable to acquire such Offsite Property, and following the written request from the OWNER to CITY, CITY 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 CITY is unable to acquire the Offsite Property by negotiation within thirty (30) days after OWNER'S written request, CITY may, initiate proceedings utilizing 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 3.7.1 The CITY and OWNER acknowledge that the timelines set forth in this Section 3.7.1 represent the maximum time periods which CITY and OWNER reasonably believe will be necessary to complete the acquisition of any Offsite Property. CITY 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 CITY.

3.7.2 Owner's Option to Terminate Proceedings. CITY 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 CITY that it wants CITY to cease all acquisition proceedings with respect to that Offsite Property, whereupon CITY shall cease such proceedings. CITY may provide written notice to OWNER no later than fifteen (15) days prior to the date of the hearing on CITY'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 CITY that it wants CITY to cease condemnation proceedings, whereupon CITY shall cease such proceedings. If OWNER does not notify CITY to cease condemnation proceedings within said fifteen (15) day period, then the CITY may proceed to consider and act upon the Offsite Property resolution of necessity. If CITY adopts such resolution of necessity, then CITY may institute condemnation proceedings and file a complaint in condemnation and seek an order of immediate possession with respect to the Offsite Property.
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18 3.8 Regulation by Other Public Agencies. It is acknowledged by the parties that other public agencies not within the control of CITY possess authority to regulate aspects of the development of the Property separately from or jointly with CITY and this Agreement does not limit the authority of such other public agencies. CITY agrees to cooperate fully, at no cost to CITY, 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 CITY.

3.9 Tentative Parcel Maps. With respect to applications by OWNER for tentative parcel maps for portions of the Property, CITY 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 CITY'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 expiration, cancellation, or termination of this Agreement.

4. PUBLIC BENEFITS.

4.2 Development Impact Fees.
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19 4.2.1 Amount of Development Impact 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 CITY 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 CITY 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 CITY.

4.3 Responsibility for Construction of Public Improvements.

4.3.1 Timely Construction of Public Infrastructure. The phasing of the area wide infrastructure construction within the vicinity of the Project shall be as approved by the CITY. OWNER shall be responsible for the timely construction and completion of all public infrastructure required for the Project as described and depicted in the Infrastructure Improvements Exhibit and any and all parcel map conditions. Unless otherwise specified in the Parcel Map conditions, and subject to the provisions of Section

4.3.3 Construction of Public Infrastructure by Third Parties. CITY and OWNER acknowledge that a portion of the Improvements described in Exhibit E and depicted in Exhibit F are necessary for the development of surrounding properties within the Ontario Ranch and the other property owners are also obligated to construct the Improvements or portions thereof. As such, CITY agrees that OWNER's obligation to construct the Improvements may be satisfied by third party owners pursuant to separate written agreements between OWNER and said third party undertaking the construction of the Improvements. Nothing in this Agreement shall be construed to prohibit the coordination of the construction of the Improvements between private parties, including the allocation of costs for the construction of the Improvements. Notwithstanding anything to the contrary herein, any applicable DIF Credits may be transferred and assigned from one (1) party to another with respect to the construction of the Improvements and such transfer or assignment shall not require the conveyance of any real property. 1015
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20 4.3.4 Availability and Use of Recycled Water. OWNER agrees that recycled water shall be available and utilized by OWNER for all construction-related water uses including prior to, and during, any grading of the Property. OWNER and CITY agree that OWNER may, in-lieu of utilizing recycled water during grading and construction, utilize water from existing agricultural wells on the Property subject to the terms of a separate Well Use Agreement between the CITY and OWNER.

4.3.5 Construction of DIF Program Infrastructure. To the extent OWNER is required to construct and completes construction of public improvements that are included in CITY's Development Impact Fee Program CITY agrees that CITY shall issue DIF Credit in accordance with the provisions of a separate Fee Credit Agreement between CITY and OWNER. Limitations 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. OWNER may be eligible to receive DIF Credit from OWNER's construction of DIF Program Infrastructure. Any such DIF Credit shall be subject to a Fee Credit Agreement between CITY and OWNER. CITY and OWNER agree that the Fee Credit Agreement between CITY and OWNER shall comply with CITY's adopted policies applicable to such agreements.

4.4 Public Services Funding Fee.

4.4.2 Public Services Funding Fee Amount. OWNER shall pay a Public Services Funding fee in a single installment payment in the amount of Seventy-Five Cents ($.75) per square foot of each non-residential building. The single installment for non- residential uses shall be due and payable on a building-by-building basis prior to the issuance of the building permit for a non-residential building. The amount of the Single Installment for non-residential uses shall automatically increase by percentage increase (but no decrease) in the Consumer Price Index (Riverside – San Bernardino – Ontario, CA), (December 2017=100) over the preceding year on January 1 st of each year, beginning on January 1, 2024. OWNER may exercise the option to pay any single installment amounts for the remainder of the non-residential square footage within the Project on or before December 31st, before the Single Installment amount is automatically increased.

4.5 Water Availability.

4.5.1 Water Availability. The Property requires the completion of the Phase 2 Water Improvements (Phase 2A and 2B) for permanent water system capacity and supply. Until the Phase 2 Water Improvements are fully constructed and completed, OWNER acknowledges that the Project shall have sufficient water capacity and supply on an interim basis made available through the construction of the Potable Water 1016
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21 Improvements (as described in Exhibit E), the Phase 2A Water Improvements, and the Interim Chino Avenue Loop depicted in Exhibit F. OWNER acknowledges and agrees that the CITY shall not issue final certificates of occupancy for the Project until the completion of the Potable Water Improvements (as described in Exhibit E), the Phase 2A Water Improvements and the Interim Chino Avenue Loop, as depicted in Exhibit F. OWNER further acknowledges and agrees the Property requires the Phase 2 Water Improvements as depicted in Exhibit F.

4.5.2 Phase 2 Water Construction Fee. Prior to CITY’s issuance of a grading permit for any parcel of the Property (each, a “Grading Permit”), OWNER shall pay to CITY the applicable Phase 2 Water Construction Fee. The Phase 2 Water Construction Fee shall be calculated based on the following formula: (a) the regional water development impact fee, based on the square footage of developable property and the approved land use category for each Phase of the Project (the “Base Regional Water DIF”), PLUS (b) OWNER’s pro rata share of the difference between the total projected cost of construction of the Phase 2 Water Improvements (the “Pro Rata Share”) and the Base Regional Water DIF. To determine the Pro Rata Share, which may fluctuate over time, CITY shall, at the time OWNER applies for a Grading Permit, calculate the total projected cost of construction of the Phase 2 Water Improvements and subtract from that amount (y) all Phase 2 Water Construction Fees previously collected and (z) the aggregate Base Regional Water DIF to be paid by OWNER and all developers then at that time obligated to pay a Base Regional Water DIF specifically for use of the Phase 2 Water Improvements (together, the “Phase 2 Water Developers”). If the difference is zero or a number less than zero, then there is no Pro Rata Share and the Phase 2 Water Construction Fee shall equal the sum of all Base Regional Water DIF to be paid by all Phase 2 Water Developers. If the difference results in a positive number, the funding gap (the “Funding Gap”) shall be divided by the total acreage of land to be developed by the Phase 2 Water Developers to obtain a Funding Gap “per acre” amount (the “Funding Gap Per Acre Amount”). Each Phase 2 Water Developer’s respective total acreage to be developed shall then be multiplied by the Funding Gap Per Acre Amount to obtain each Phase 2 Water Developer’s Pro Rata Share, which will then be added to each Phase 2 Water Developer’s Base Regional Water DIF to obtain the Phase 2 Water Construction Fee due and payable at the time of issuance of the applicable Grading Permit.

4.5.4 Additional Contributions for Phase 2 Water Improvements. OWNER acknowledges and agrees that, as of the Effective Date of this Agreement, the CITY does not have sufficient funding to construct and complete the Phase 2 Water Improvements.

OWNER agrees to provide the CITY with additional contributions for the Phase 2 Water 1017
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22 Improvements prior to the issuance of a Grading Permit for any Phase within the Project, pursuant to the Pro Rata Share calculation as set forth in Section 4.5.2 above. OWNER acknowledges and agrees that the CITY has the right to conduct subsequent reviews of the available funding for the construction of, or continuation of the construction of, the Phase 2 Water Improvements. If at any time outside of OWNER’s submission of a request for a Grading Permit the CITY determines that there is not sufficient funding for the construction of, or continuation of the construction of, the Phase 2 Water Improvements necessary to support current and anticipated future development within the Ontario Ranch area served by the Phase 2 Water Improvements, OWNER agrees to pay such subsequent additional contribution payment necessary from the OWNER (on a pro rata basis with other Phase 2 Water Developers then existing at the time) to the CITY to initiate construction of, or continue construction of, the Phase 2 Water Improvements. The CITY shall determine OWNER’s additional contribution amount (above and beyond OWNER’s Pro Rata Share) and such amount shall be due and payable to the CITY within thirty (30) days of written notice from the CITY to OWNER.

4.5.5 Future Reimbursement of Pro Rata Share of Phase 2 Water Construction Fees. OWNER agrees that the CITY will be responsible for the construction and completion of the Phase 2 Water Improvements, as depicted in Exhibit F. Subject to the successful completion of the Phase 2 Water Improvements, CITY and OWNER shall meet periodically and/or as needed from the date of completion of the Phase 2 Water Improvements, to jointly develop a plan and mutually enter into an agreement for the reimbursement of OWNER’s Pro Rata Share of Phase 2 Water Construction Fees that may be reimbursed from future development in the 925 Zone as depicted in the City’s Domestic Water Master Plan, following any reallocation of each Phase 2 Water Developer’s Pro Rata Share, CITY’s collection of additional Regional Water DIF in connection with construction of the Phase 2 Water Improvements, and after the completion of the Phase 2 Water Improvements. Such agreement shall be approved at the sole discretion of the Ontario City Council.

4.6 Compliance with Public Benefits Requirements.

4.6.1 Failure to Provide Public Benefits. In the event OWNER fails or refuses to comply with any condition referenced in Section 4.1 through 4.5, or challenges (whether administratively or through legal proceedings) the imposition of such conditions, OWNER shall be deemed in default of this Agreement, thereby entitling CITY to any and all remedies available to it, including, without limitation, the right of CITY to withhold OWNER's Project-related building permits, certificates of occupancy, or discretionary approvals, without liability. Nothing herein shall waive OWNER's right to assert a default (or failure to perform) by CITY has excused OWNER's performance under this Agreement.

5. FINANCING OF PUBLIC IMPROVEMENTS.

5.1 Financing Mechanism(s). OWNER agrees that, prior to the recordation of any Parcel Map, the property subject to such Parcel Map shall be included in a CFD to finance CITY services through annual special taxes that will initially be Twenty-Seven Cents 1018
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23 ($.27) per square foot for non-residential buildings. These amounts shall be subject to an automatic increase at a rate not to exceed four (4%) percent per year. Depending on the fiscal year that the CFD is formed and the CFD tax is levied, the annual special taxes may be higher. CITY shall be the sole and exclusive lead agency in the formation of any CFD, assessment district or other public financing mechanism within the Property; provided however, that the proceeds of any such CFD, assessment district, or financing mechanism may be used, subject to restrictions that may be imposed by applicable law, for the purposes of acquiring, constructing or maintaining public facilities to be owned or operated by other public agencies, including, without limitation those facilities owned or operated by a school district. In addition to the rights of the CITY pursuant to section 5.1 hereof, CITY shall have the right, but not the obligation, to condition the formation of any CFD, assessment district or other public financing mechanism within the Property on the OWNER mitigating all Project-related impacts to the applicable school district(s) as required by such school district(s). Written evidence by such school district(s) may be required by the CITY as the condition to the formation of any CFD, assessment district or other public financing mechanism within the Property, or any steps preliminary thereto, including, without limitation, the adoption of any resolution of intention to form such CFD, assessment district or other public financing mechanism within the Property. It is not the intent of the parties hereto, by this provision, to prohibit or otherwise limit CITY’s ability to take any and all necessary steps requisite to the formation of the CFD to finance CITY services through annual special taxes as set forth in this Section 5.1. Formation of any CFD, assessment district or other public financing mechanism within the Property, shall be subject to CITY's ability to make all findings required by applicable law and complying with all applicable legal procedures and requirements including, without limitation, CITY's public financing district policies as such policies may be amended from time to time.

6. [OMITTED]

7. REVIEW FOR COMPLIANCE.

7.1 Periodic and Special Reviews.

7.1.1 Time for and Initiation of Periodic Review. The CITY shall review this Agreement every twelve (12) months from the Effective Date in order to ascertain the good faith compliance by the OWNER with the terms of this Agreement. The OWNER shall submit an Annual Monitoring Report to CITY, in a form acceptable to the City Manager, along with any applicable processing charge within ten (10) days after each anniversary date of the Effective Date of this Agreement. Within fifteen (15) days after the receipt of the Annual Monitoring Report, CITY shall review the Annual Monitoring Report. Prior to the expiration of the fifteen (15) day review period, CITY shall either issue a notice of continuing compliance or a notice of non-compliance and a notice of CITY's intent to conduct a Special Review pursuant to Sections 7.1.2 through 7.1.6. Issuance of a notice of continuing compliance may be issued by the City Manager or his designee. 1019
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24 7.1.2 Initiation of Special Review. A special review may be called either by agreement between the parties or by initiation in one or more of the following ways:
(a) Recommendation of the Planning staff;
(b) Affirmative vote of at least four (4) members of the Planning Commission; or (c) Affirmative vote of at least three (3) members of the City Council.

7.1.3 Notice of Special Review. The City Manager shall begin the special review proceeding by giving notice that the CITY intends to undertake a special review of this Agreement to the OWNER. 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.

7.1.4 Public Hearing. The Planning Commission shall conduct a hearing at which the OWNER must demonstrate good faith compliance with the terms of this Agreement.

The burden of proof on this issue is upon the OWNER.

7.1.5 Findings Upon Public Hearing. The Planning Commission shall determine upon the basis of substantial evidence whether or not the OWNER has, for the period under review, complied in good faith with the terms and conditions of this Agreement.

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

7.1.6(b), the CITY determines to proceed with modification or termination of this Agreement, the CITY shall give notice to the property OWNER of its intention so to do.

The notice shall contain:
(a) The time and place of the hearing;
(b) A statement as to whether or not the CITY proposes to terminate or to modify this Agreement; and
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25 (c) Other information that the CITY considers necessary to inform the OWNER of the nature of the proceeding.

7.3 Hearing on Modification or Termination. At the time and place set for the hearing on modification or termination, the OWNER shall be given an opportunity to be heard.

The 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 the OWNER.

7.4 Certificate of Agreement Compliance. If, at the conclusion of a Periodic or Special Review, OWNER is found to be in compliance with this Agreement, CITY 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 City 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, CITY 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 City Council.

8. [OMITTED]

9. DEFAULT AND REMEDIES.

9.1 Remedies in General. It is acknowledged by the parties that CITY would not have entered into this Agreement if it were to be liable in 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 (i) CITY shall not be liable in damages to OWNER, or to any successor in interest of OWNER, or to any other person, and OWNER covenants not to sue for damages or claim any damages and (ii) OWNER shall not be liable in damages to CITY, or to any other person, and CITY 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
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26 (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.

9.2 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 CITY and OWNER as provided in Section 9.1 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.

9.3 Release. Except for non-damage remedies, including the remedies of judicial review and of specific performance as provided for in Sections 7.3 and 9.2, respectively,, OWNER, for itself, its successors and assignees, hereby releases the CITY, 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 CITY because it entered into this Agreement or because of the terms of this Agreement.

9.4 Termination or Modification of Agreement for Default of OWNER. Subject to the provisions contained in Sections 7.2 and 7.3 herein, CITY 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, CITY 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 1022
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27 within such 60 day period and to diligently proceed to complete such actions and cure such default.

9.5 Termination of Agreement for Default of CITY. OWNER may terminate this Agreement only in the event of a default by CITY in the performance of a material term of this Agreement and only after providing written notice to CITY of default setting forth the nature of the default and the actions, if any, required by CITY to cure such default and, where the default can be cured, CITY 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.

10.THIRD PARTY LITIGATION.

10.1 General Plan Litigation. CITY has determined that this Agreement is consistent with the General Plan, as such 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 CITY's determination. CITY shall have no liability in damages under this Agreement for any failure of CITY to perform under this Agreement or the inability of OWNER to develop the Property as contemplated by the Development Plan or 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.

10.2 Third Party Litigation Concerning Agreement. OWNER shall defend, at its expense, including attorneys' fees, indemnify, and hold harmless CITY, its agents, officers and employees from any claim, action or proceeding against CITY, 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. CITY shall promptly notify OWNER of any such claim, action or proceeding, and CITY shall cooperate in the defense. If CITY fails to promptly notify OWNER of any such claim, action or proceeding, or if CITY fails to cooperate in the defense, OWNER shall not thereafter be responsible to defend, indemnify, or hold harmless CITY. CITY may in its discretion participate in the defense of any such claim, action or proceeding.

10.3 Indemnity. In addition to the provisions of Section 10.2 above, OWNER shall indemnify and hold CITY, 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, to the extent 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 active negligence or sole willful misconduct of CITY. OWNER shall defend, at its expense, including attorneys' fees, CITY, its officers, agents, employees 1023
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28 and independent contractors in any legal action based upon such alleged acts or omissions. CITY may in its discretion participate in the defense of any such legal action.

OWNER’s indemnity obligation shall terminate following CITY’s legal acceptance of (i.e. taking of title to) the Improvements.

10.4 Environment Assurances. OWNER shall indemnify and hold CITY, its officers, agents, and employees free and harmless from any liability, to the extent 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 during OWNER'S period of ownership of the Property, including, but not limited to, soil and groundwater conditions caused by OWNER, and OWNER shall defend, at its expense, including attorneys' fees, CITY, its officers, agents and employees in any action based or asserted upon any such alleged act or omission. CITY may in its discretion participate in the defense of any such action.

10.5 Reservation of Rights. With respect to Sections 10.2, 10.3 and 10.4 herein, CITY reserves the right to either (1) approve the attorney(s) which OWNER selects, hires or otherwise engages to defend CITY hereunder, which approval shall not be unreasonably withheld, or (2) conduct its own defense, provided, however, that OWNER shall reimburse CITY forthwith for any and all reasonable expenses incurred for such defense, including attorneys' fees, upon billing and accounting therefor.

10.6 Survival. The provisions of this Sections 10.1 through 10.6, inclusive, shall survive the termination of this Agreement.

11. MORTGAGEE PROTECTION.

11.1 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. CITY 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. CITY 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 CITY in the 1024
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29 manner specified herein for giving notices, shall be entitled to receive written notification from CITY of any default by OWNER in the performance of OWNER's obligations under this Agreement.
(c) If CITY timely receives a request from a Mortgagee requesting a copy of any notice of default given to OWNER under the terms of this Agreement, CITY 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 CITY, the performance thereof shall continue to be a condition precedent to CITY'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 (e) In the event of a default by OWNER, any Mortgagee shall have the right to remedy, or cause to be remedied, such default within sixty (60) days following the later to occur of (i) the date of Mortgagee's receipt of the notice referred to in Section 9.4 above, or (ii) the expiration of the period provided herein for OWNER to remedy or cure such default, and CITY shall accept such performance by or at the insistence of the Mortgagee as if the same had been timely made by OWNER; provided, however, that (i) if such default is not capable of being cured within the timeframes set forth in this Section and Mortgagee commences to cure the default within such timeframes, then Mortgagee shall have such additional time as is required to cure the default so long as Mortgagee diligently prosecutes the cure to completion and (ii) if possession of the Property (or portion thereof) is required to effectuate such cure or remedy, the Mortgagee shall be deemed to have timely cured or remedied if it commences the proceedings necessary to obtain possession thereof within sixty (60) days after receipt of the copy of the notice, diligently pursues such proceedings to completion, and, after obtaining possession, diligently completes such cure or remedy.

12. MISCELLANEOUS PROVISIONS.

12.2 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.

12.3 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 CITY 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.

12.4 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.

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

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

12.7 Joint and Several Obligations. Pursuant to Section 2.4, if at any time during the term of this Agreement the Property is subsequently owned, in whole or in part, by more than one owner, all obligations of such owners under this Agreement shall be joint and several, and the default of any such owner shall be the default of all such owners.

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

12.9 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 1026
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31 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.

12.10 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.

12.11 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, governmental orders related to statewide or national pandemics, any third party court actions challenging the Project (including but not limited to writs of mandate, 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.

12.12 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.

12.13 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.

12.14 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.

12.15 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.

12.16 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 1027
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32 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 CITY and OWNER is that of a government entity regulating the development of private property and the owner of such property.

12.17 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 City Manager may delegate his powers and duties under this Agreement to an Assistant City Manager or other management level employee of the CITY.

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

12.19 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.

12.20 Estoppel Certificate. Within thirty (30) business 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 CITY all costs incurred by CITY in connection with 1028
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33 the issuance of estoppel certificates requested by OWNER under this Section 12.20 prior to CITY's issuance of such certificates.

12.21 Authority to Execute. The person or persons executing this Agreement on behalf of OWNER 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 OWNER to the performance of its obligations hereunder.

12.22 Prevailing Wage . OWNER, for itself, its successors, and assigns, agrees, covenants, and warrants that the development of the Property, if any, shall comply with all applicable federal and state labor laws (including, without limitation, the requirement under California law to pay prevailing wages and hire apprentices), and all obligations as set forth herein.

12.22.1 CITY makes no representations concerning prevailing wages in compliance with California Labor Code Section 1770 et seq.

12.22.2 OWNER acknowledges and agrees that it shall be independently responsible for reviewing the applicable laws and regulations with respect to the payment of prevailing wages and complying therewith. OWNER shall bear all risks of payment or non-payment of prevailing wages under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar law.

12.22.3 The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the construction and development of the Property by OWNER, its successors or assigns. OWNER shall be solely responsible for determining and effectuating compliance with such laws.

12.22.4 OWNER, ON BEHALF OF ITSELF, ITS SUCCESSORS, AND ASSIGNS,

WAIVES AND RELEASES CITY FROM ANY RIGHT OF ACTION THAT MAY BE AVAILABLE TO OWNER PURSUANT TO LABOR CODE SECTION 1781 OR THE DAVIS BACON ACT. RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 12.22, OWNER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542, WHICH READS AS FOLLOWS: A GENERAL RELEASE DOES

NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT

KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF

EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE

MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.
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34 INITIALS. BY INITIALING BELOW, OWNER KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY WITH THE MATTERS WHICH ARE THE SUBJECT OF THE FOREGOING WAIVERS AND RELEASES:
_______________
(Owner's Initials)
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year set forth below.
[SIGNATURES CONTAINED ON FOLLOWING PAGE]
1030
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35 SIGNATURE PAGE

TO DEVELOPMENT AGREEMENT
FILE NO. PDA21-005
"OWNER"

GROVE LAND VENTURE LLC
a Delaware limited liability company
by: RBV Grove, LLC, a Delaware limited
liability company, its managing member
by: REDA Bascom Ventures, LLC, a
Delaware limited liability company, its
managing member
by: Real Estate Development Associates,
LLC, a California limited liability company, its
administrative member
by: Waters Edge Property Group, LLC, a
California limited liability company, its
member
By: ________________________
Jason Krotts
Authorized Signatory
Date: ___________________
ATTEST:

City Clerk, Ontario
APPROVED AS TO FORM:

BEST BEST & KRIEGER, LLP
City Attorney
"CITY"

CITY OF ONTARIO
By:

Scott Ochoa
City Manager
Date: ___________________
1031
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36 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 this ___ day of ______________, 2023 before
me, , Notary Public, personally
appeared , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: (Seal)
1032
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37 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 this ___ day of ______________, 2023 before
me, , Notary Public, personally
appeared , who proved to me
on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature: (Seal)
1033
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38 EXHIBIT "A"

TO DEVELOPMENT AGREEMENT
Legal Description of Property

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF

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

LOTS 1, 2, 3, 4, 13, 14, 15, 16, 17, 18, 19, 20, 29, 30, 31 AND 32 IN SECTION 20, TOWNSHIP 2 SOUTH, RANGE 7 WEST, SAN BERNARDINO BASE AND

MERIDIAN, ACCORDING TO THE MAP OF THE SUBDIVISION OF RANCHO

SANTA ANA DEL CHINO, IN THE CITY OF ONTARIO, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, RECORDED IN BOOK 6, PAGE 15 OF MAPS OF RECORDS OF SAID COUNTY.

APNs: 1054-071-01, 1054-071-02, 1054-081-03, 1054-091-01, 1054-091-02, 1054-101-01, 1054-101-02, 1054-231-01, 1054-231-02, 1054-241-01, 1054-241- 02, 1054-311-01, 1054-311-02, 1054-321-01, 1054-321-02. 1034
46700.10300\33554440.1
39 EXHIBIT "B"

TO DEVELOPMENT AGREEMENT
Map showing Property and its location
1035
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40 EXHIBIT "C"

TO DEVELOPMENT AGREEMENT
Existing Development Approvals
On January 1, 2022, the Planning Commission:
a) Approved Resolution No. PC22-004, recommending the City Council certify the Environmental Impact Report (SCH#2021010318) for the South Ontario Logistics Center Specific Plan (File No. PSP19-001).
b) Approved Resolution No. PC22-005, recommending the City Council approve the General Plan Amendment (File No. PGPA19-004). c) Approved Resolution No. PC22-006, recommending the City Council approve the South Ontario Logistics Center Specific Plan (File No. PSP19- 001).

On March 1, 2022, the City Council:
a) Adopted Resolution No. 2022-015, certifying the Environmental Impact Report (SCH#2021010318) for the South Ontario Logistics Center Specific Plan.
b) Adopted Resolution No. 2022-016, approving the General Plan Amendment (File No. PGPA19-004).

On March 15, 2022, the City Council:
a) Adopted Ordinance No. 3206, approving the South Ontario Logistics Center Specific Plan (File No. PSP19-001)
1036
46700.10300\33554440.1
41 EXHIBIT "D"

TO DEVELOPMENT AGREEMENT
Existing Land Use Regulations
These documents are listed for reference only:

1. General Plan Amendment (File No. PGPA19-004)

2. South Ontario Logistics Center Specific Plan (File No. PSP19-001), Ordinance No. 3206

3. South Ontario Logistics Center Environmental Impact Report (SCH#2021010318)

4. City of Ontario Municipal Code
a. Six – Sanitation & Health
b. Seven – Public Works
c. Eight – Building Regulations
d. Nine – Development Code
e. Ten – Parks & Recreation
1037
46700.10300\33554440.1
42 EXHIBIT “E”

TO THE DEVELOPMENT AGREEMENT

DESCRIPTION OF REQUIRED IMPROVEMENTS
OWNER shall design, construct, and complete the following Street, Sewer, Storm Drain, Potable Water, Recycled Water, and Fiber Optic improvements, prior to OWNER’s request for any final certificate of occupancy permit for any building within the Property.

1. OWNER shall design, construct, and complete the following Improvements, Potable Water (WT), Storm Drain (SD), Streets (ST), Sewer (SW), Recycled Water (RW), and Fiber Optics (FO), as described, prior to OWNER’s request for final occupancy of the first building:
a. WT on Grove Avenue between Eucalyptus Avenue and Merrill Avenue (Local Water DIF Project WT-011).
b. WT on Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.
c. WT on Eucalyptus Avenue between Bon View Avenue and Grove Avenue (Local Water DIF Project WT-011).
d. WT on Eucalyptus Avenue between Grove Avenue and Carpenter Avenue (Regional Water DIF Project, portion of Phase 2A Water). e. WT on Merrill Avenue between Bon View Avenue and Carpenter Avenue (Local Water DIF Project WT-011).
f. SD onsite detention shall be designed, constructed, and completed by OWNER prior to issuance of the first building permit. However, OWNER is eligible to request from CITY a grading permit prior to the completion of the SD onsite detention.
g. SD on Grove Avenue from Eucalyptus Avenue to Merrill Avenue. h. SD on Eucalyptus Avenue between Bon View Avenue and Grove Avenue.
i. SD on Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.
j. SD on Merrill Avenue between Euclid Avenue and Grove Avenue. 1038
46700.10300\33554440.1
43 k. SD bleeder line or alternative interim connection at the discretion of the City on Euclid Ave south of Merrill Ave. This shall connect to the SD on Merrill Ave between Euclid Ave and Grove Avenue.
l. Two (2) Debris Separation Baffle Boxes at the intersections of Euclid Avenue and Merrill Avenue, and Merrill Avenue and Grove Avenue. m. Full half ST improvements on the south half and circulation lane improvements on the north half of Eucalyptus Avenue from Bon View Avenue to Grove Avenue.
n. Full half ST improvements on both sides of Merrill Avenue between Euclid Avenue and Carpenter Avenue.
o. Full half ST improvements on the east side and circulation lane improvements on the west side of Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.
p. Full half ST improvements on the west side and circulation lane improvements on the east side of Grove Avenue between Eucalyptus Avenue and Merrill Avenue.
q. Traffic Signals at Bon View Avenue/Eucalyptus Avenue, at Bon View Avenue/Merrill Avenue, at Eucalyptus Avenue/Grove Avenue, and at Grove Avenue, at the signalized median break that aligns with Merrill Commerce Center Specific Plan.
r. Traffic Signal on Merrill Avenue approximately halfway between Bon View and Grove Avenues.
s. Traffic signal modifications at Euclid Avenue/Merrill Avenue and Euclid Avenue/Eucalyptus Avenue.
t. SW (Western Trunk Sewer) on Euclid Avenue between Kimball Avenue and Merrill Avenue (Regional Sewer DIF Project SW-002). u. SW (Western Trunk Sewer) on Merrill Avenue between Euclid Avenue and Grove Avenue (Regional Sewer DIF Project SW-002).
v. SW on Bon View Avenue between Merrill Avenue and Eucalyptus Avenue (Local Sewer DIF Project SW-010).
w. SW on Grove Avenue between Merrill Avenue and Eucalyptus Avenue (Local Sewer DIF Project SW-009).
x. RW on Bon View Avenue between Eucalyptus Avenue and Merrill 1039
46700.10300\33554440.1
44 Avenue (Local Water DIF Project WT-016).
y. RW on Merrill Avenue between Campus Avenue and Grove Avenue (Local Water DIF Project WT-016).
z. RW on Grove Avenue between Merrill Avenue and Eucalyptus Avenue (Local DIF Project WT-016).
aa.RW on Eucalyptus Avenue between Bon View Avenue and Grove Avenue (Local DIF Project WT-016).
bb.FO on Eucalyptus Avenue between Bon View Avenue and Grove Avenue.
cc. FO on Bon View Avenue between Eucalyptus Avenue and Merrill Avenue.
dd.FO on Merrill Avenue between Bon View Avenue and Grove Avenue. ee.FO on Grove Avenue between Eucalyptus Avenue and Merrill Avenue.

2. CITY shall design, construct, and complete the Phase 2 Water (WT) Improvements and Interim Chino Avenue Loop. The Phase 2 Water Improvements will be constructed by the CITY in phases, with the initial improvements, designated as Phase 2A Water Improvements, Interim Chino Avenue Loop, and Phase 2B Water Improvements as described below. a. Phase 2A Water Improvements shall consist of the following:
i. WT on Grove Avenue between Eucalyptus Avenue and Chino Avenue (Regional Water DIF Project WT-010).
b. Interim Chino Avenue Loop shall consist of the following:
i. WT on Chino Avenue between Cucamonga Channel and
Grove Avenue, which will provide the second point of
connection from the 1010 Pressure Zone (Local Water DIF Project WT-009).
ii. Pressure Reducing Station at Grove Avenue and Chino Avenue, which will provide the second point of connection from 1010 Pressure Zone (Future Local Water DIF Project WT-009). 1040
46700.10300\33554440.1
45 OWNER shall pay one hundred percent (100%) of the costs to construct the Phase 2A Improvements and the Interim Chino Avenue Loop, within forty-five (45) days from the Effective Date of this Agreement, and such payment shall be the “Phase 2A Water Payment”. The costs in the foregoing sentence shall equal the actual bid amount of the awarded contracts for the work, plus fifteen percent (15%). Upon OWNER’s full and complete payment to CITY, the CITY shall issue a Certificate of DIF Credit in the Regional Water category and/or the Local Adjacent Water category, as appropriate. Each DIF Water Certificate shall be issued by CITY within thirty (30) days of the receipt of such required payment.

CITY shall not issue any building permits until receipt of the full Phase 2A Water Payment.
c. Phase 2B Water Improvements shall consist of the following:
i. WT on Francis Street between Grove Avenue and Bon View Avenue (Regional Water DIF Project WT-010).
ii. WT on Bon View Avenue between Francis Street and the Bon View Reservoir Site (Regional Water DIF Project WT-010). iii. WT – Nine (9) Million Gallon reservoir at Bon View Reservoir Site (Regional Water DIF Project WT-014).
iv. WT – Two (2) Groundwater Production Wells in vicinity of Bon View Reservoir Site (Regional Water DIF Project WT-007). v. WT on Grove Avenue between Chino Avenue and Francis
Street (Regional Water DIF Project WT-010). The final design and alignment north of Riverside Drive is subject to change at the reasonable discretion of the CITY.

The Phase 2B Water Improvements will be constructed by the CITY and funded by OWNER, pursuant to Section 4.5 of this Agreement.

TO DEVELOPMENT AGREEMENT
Required Infrastructure Improvements
(SEE ATTACHED EXHIBITS)
1042
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47 1043
46700.10300\33554440.1
48 1044
46700.10300\33554440.1
49 1045
46700.10300\33554440.1
50 1046
46700.10300\33554440.1
51 1047
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52 1048
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53 1049
46700.10300\33554440.1
54 Exhibit "G"

FORM OF CERTIFICATE OF REGIONAL DIF CREDIT
Pursuant to Section 4.5.3 of this Agreement by and between the City of Ontario and ____________________, dated _______________, 20 , the terms and definitions of which are hereby incorporated herein by this reference and hereinafter called the "Development Agreement', the City of Ontario hereby certifies that OWNER is entitled to the following amount and nature of DIF Credits in the Regional Water DIF Infrastructure Category:

Amount of Credit: $
Scott Ochoa, City Manager
Dated:
1050
Department: Planning
Prepared By: Alexis Vaughn
Department: Planning
Prepared By: Edmelynne V Hutter
Staff Member Presenting:

Scott Murphy, Executive Director Community
Development
Approved By:

Submitted To: Council/OHA
Approved: _______________________________
Continued To: ___________________________
Denied: __________________________________
Item No: 14
SUBJECT:

A PUBLIC HEARING TO CONSIDER AN AMENDMENT TO THE SOUTH ONTARIO LOGISTICS CENTER SPECIFIC PLAN (FILE NO. PSPA22-008), TO REMOVE A 71.6-

ACRE PORTION OF THE SPECIFIC PLAN, IN CONJUNCTION WITH A ZONE CHANGE (FILE NO. PZC23-001) LOCATED SOUTH OF EUCALYPTUS AVENUE, NORTH OF

MERRILL AVENUE, WEST OF BON VIEW AVENUE, AND EAST OF CAMPUS AVENUE

CITY OF ONTARIO
Agenda Report
May 16, 2023
SECTION:

PUBLIC HEARINGS

RECOMMENDATION:

That the City Council consider the following:

A
.

Adopt a Resolution approving File No. PSPA22-008, an Amendment to the South Ontario Logistics Center Speciﬁc Plan, including map and textual changes, to remove 71.6 acres from the Specific Plan; and
B
.

Introduce and waive further reading of an Ordinance adopting File No. PZC23-001, a Zone Change to establish the SP/AG (Specific Plan/Agriculture Overlay) zoning district on the Project site.

THE FOLLOWING COUNCIL GOALS ARE BEING ACHIEVED:

Ensure the Development of a Well Planned, Balanced, and Self-Sustaining Community in Ontario Ranch
Operate in a Businesslike Manner
FISCAL IMPACT:

There is no direct ﬁscal impact to the City associated with this Speciﬁc Plan Amendment and Zone Change.

BACKGROUND & ANALYSIS:

The Ontario Plan 2050 Policy Plan (General Plan) provides the basic framework for development within the 8,200-acre area commonly referred to as Ontario Ranch.

The Policy Plan requires City Council approval of a Speciﬁc Plan for new developments of 10 acres or more within Ontario Ranch. A Speciﬁc Plan is required to ensure that suﬃcient land area is included to achieve cohesive, uniﬁed districts and neighborhoods, as well as to incorporate development framework for detailed land use, circulation, infrastructure improvements, public 1051
service provisions, and urban design and landscape standards.

On March 1, 2022, the City Council approved the South Ontario Logistics Center Speciﬁc Plan (File No. PSP19-001) and associated Environmental Impact Report (State Clearinghouse No. 2021010318), inclusive of the Project site. However, a writ of mandate challenging the project (File No. PSP19-001) was ﬁled on March 30, 2022, and a settlement agreement was entered into by the applicant and the petitioner on October 14, 2022. One term of the settlement agreement was to remove the San Bernardino County-owned parcels (Project site) from the Speciﬁc Plan. Thus, the applicant ﬁled for a Speciﬁc Plan Amendment on December 6, 2022, to remove the 71.6-acres of San Bernardino County owned land from the Speciﬁc Plan. Subsequently, the City initiated a Zone Change Amendment to re-establish zoning on the 71.6-acre Project Site to replace the Speciﬁc Plan designation.

Speciﬁc Plan Amendment
— The Speciﬁc Plan Amendment consists of map and text changes to accommodate removal of 71.6-acres of land from the South Ontario Logistics Center Speciﬁc Plan.

The overall Speciﬁc Plan acreage will be reduced from 219.39 acres to 147.85 acres (see Figure 2:

Speciﬁc Plan Table 1.0 Land Use Summary). The Speciﬁc Plan Amendment includes adjustments to the Speciﬁc Plan boundaries, total acreage and buildout, development phasing, street and landscape sections, circulation, and utilities (see Planning Commission Backup: Attachment "A" to the Specific Plan Resolution – Specific Plan Amendment Redlined Document and Exhibit "B": Specific Plan Land Use Plan Revision). The Speciﬁc Plan was also updated to reﬂect more current and accurate development information within the remainder of the Speciﬁc Plan area. No changes are proposed to the general development and design standards aside from removal of Campus Avenue standards that no longer apply.

Zone Change
— All properties within the City must have a speciﬁc plan land use or zoning district assigned to it, and all speciﬁc plans and zoning districts within the City must be consistent with The Ontario Plan 2050 Policy Plan - Land Use Plan. As a result of the Speciﬁc Plan Amendment, which will remove a portion of land from the Speciﬁc Plan, a Zone Change must also be processed to re- establish zoning for the Project site. Prior to establishment of the South Ontario Logistics Center Speciﬁc Plan, the Project site was zoned Speciﬁc Plan (Agriculture Overlay). As such, staﬀ is proposing that the Project site zoning revert back to the previous Speciﬁc Plan (Agriculture Overlay) zoning designation to allow for interim agricultural activities until a speciﬁc plan is established for the 71.6-acre Project Site (see Planning Commission Backup Exhibit C: Zoning Map Change). The proposed Speciﬁc Plan (Agriculture Overlay) zoning designation is consistent with The Ontario Plan 2050 Policy Plan - Land Use Plan, as it allows for interim agricultural activities general development and design standards aside from removal of Campus Avenue standards that no longer apply.

On April 25, 2023, the Planning Commission conducted a public hearing to consider the Amendment to the South Ontario Logistics Center Speciﬁc Plan (File No. PSPA22-008) and Zone Change (File No. PZC23-001) and concluded the hearing on that date. After considering all public testimony on the applications, the Planning Commission unanimously approved (6-0) Resolution No. PC23-29, recommending that the City Council approve the Amendment to the South Ontario Logistics Center Speciﬁc Plan and Resolution No. PC23-30 recommending that the City Council approve the Zone Change.

1052
CORRESPONDENCE:

As of the preparation of this agenda report, Planning Department staﬀ received a phone call from Keith Berk with San Bernardino County Real Estate Services looking for assurance that the Speciﬁc Plan Amendment would not aﬀect the current agricultural use on the Project site. Staﬀ clariﬁed that the proposed Amendment would not impact the current use on the Project site and the agricultural use can continue.

AIRPORT LAND USE COMPATIBILITY PLAN COMPLIANCE:

On April 19, 2011, the City Council of the City of Ontario approved and adopted the Ontario International Airport Land Use Compatibility Plan, establishing the Airport Inﬂuence Area for Ontario International Airport, which encompasses lands within parts of San Bernardino, Riverside, and Los Angeles Counties, and limits future land uses and development within the Airport Inﬂuence Area, as they relate to noise, safety, airspace protection, and overﬂight impacts of current and future airport activity. As the decision-making body for the Project, the City Council has reviewed and considered the facts and information contained in the Application and supporting documentation against the Ontario International Airport Land Use Compatibility Plan compatibility factors, including [1] Safety Criteria (Ontario International Airport Land Use Compatibility Plan Table 2-2) and Safety Zones (Ontario International Airport Land Use Compatibility Plan Map 2-2), [2] Noise Criteria (Ontario International Airport Land Use Compatibility Plan Table 2-3) and Noise Impact Zones (Ontario International Airport Land Use Compatibility Plan Map 2-3), [3] Airspace protection Zones (Ontario International Airport Land Use Compatibility Plan Map 2-4), and [4] Overﬂight Notiﬁcation Zones (Ontario International Airport Land Use Compatibility Plan Map 2-5). As a result, the City Council, therefore, finds and determines that the Project, when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the Ontario International Airport Land Use Compatibility Plan.

On August 2, 2022, the City Council of the City of Ontario approved and adopted a Development Code Amendment to establish the Chino Airport Overlay Zoning District and Reference I, Chino Airport Land Use Compatibility Plan. The Chino Airport Overlay Zoning District and CNO ALUCP established the Airport Inﬂuence Area for Chino Airport, solely within the City of Ontario, and limits future land uses and development within the Airport Inﬂuence Area, as they relate to safety, airspace protection, and overﬂight impacts of current and future airport activity. The Chino Airport Land Use Compatibility Plan is consistent with policies and criteria set forth within the Caltrans 2011 California Airport Land Use Planning Handbook. The proposed Project is located within the Airport Inﬂuence Area of Chino Airport and was evaluated and found to be consistent with the California Airport Land Use Planning Handbook and the Chino Airport Land Use Compatibility Plan. As the decision-making body for the Project, the City Council has reviewed and considered the facts and information contained in the Application and supporting documentation against the Chino Airport Land Use Compatibility Plan compatibility factors, including Safety, Airspace Protection, Overﬂight.

As a result, the City Council, therefore, ﬁnds and determines that the Project, when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the California Airport Land Use Planning Handbook and the Chino Airport Land Use 1053
Compatibility Plan.

HOUSING ELEMENT COMPLIANCE:

The Project is consistent with the Housing Element of the Policy Plan (general plan) component of The Ontario Plan 2050, as the Project site is not one of the properties in the Housing Element Sites contained in Tables B-1 and B-2 (Housing Element Sites Inventory) of the Housing Element Technical Report.

ENVIRONMENTAL REVIEW:

The environmental impacts of this Project were previously reviewed in conjunction with the South Ontario Logistics Center Speciﬁc Plan (File No. PSP19-001), for which an Environmental Impact Report (“EIR”, State Clearinghouse No. 2021010318) was certiﬁed by the City Council on March 1, 2022. This Application introduces no new signiﬁcant environmental impacts.

Substantial changes are not proposed with the Project which would require major or any revisions to the previous EIR due to the involvement of no new signiﬁcant environmental eﬀects or no new substantial increase in the severity of previously identiﬁed signiﬁcant eﬀects. All previously adopted mitigation measures have not changed and are a condition of Project approval and are incorporated herein by this reference. As the Project site is to revert the zoning designation back to Speciﬁc Plan (Agriculture Overlay), associated impacts were analyzed as an alternative within the South Ontario Logistics Center Specific Plan EIR.
1054
Case Planner: Alexis Vaughn Hearing Body Date Decision Action Planning Director
Approval:

DAB N/A N/A
PC 04/25/2023 Recommend
Submittal Date: December 6, 2023 CC 05/16/2023 Final
F
ILE NOS: PSPA22-008 and PZC23-001
SU
BJECT: A public hearing to consider a request to amend the South Ontario Logistics Center Specific Plan, including map and textual changes to remove a 71.6-acre portion of the Specific Plan, in conjunction with a Zone Change to establish the SP(AG) zoning district on the Project site. The Project site is generally located south of Eucalyptus Avenue, north of Merrill Avenue, west of Bon View Avenue, and east of Campus Avenue.

Submitted by Grove Land Venture, LLC. City Council action is required.

PR
OPERTY OWNER: County of San Bernardino
R
ECOMMENDED ACTION: That the Planning Commission recommends that City Council consider and approve File No s. PSPA22-008 and PZC23 -001, pursuant to the facts and reasons contained in the staff report and attached resolution s, and subject to the conditions of approval appended to the attached Specific Plan Amendment and Zone Change resolutions as "Attachment B.”
P
ROJECT SETTING: The Project site is owned by the County of San Bernardino and is comprised of 71.6 acres of
land located south of
Eucalyptus Avenue, north
of Merrill Avenue, west of
Bon View Avenue, and
east of Campus Avenue,
currently within the
Business Park and Industrial
General land use districts
of the South Ontario
Logistics Center Specific
Plan (see Figure 1: Project
Location). The property to
the east of the project site
is located within the South
Ontario Logistics Center
Specific Plan and is
currently vacant , as the
site is under entitlement
Figure 1: Project Location
303 East B Street, Ontario, California 91764 Phone: 909.395.2036 / Fax: 909.395.2420

PLANNING COMMISSION

AGENDA REPORT
April 25, 2023
Approval
1055
Planning Commission Agenda Report
File Nos.: PSPA22-008 and PZC23-001
April 25, 2023

Page 2 of 9 ends

review for industrial development. The property to the west of the Project site is located within the Ontario Ranch Business Park Specific Plan and is currently vacant, as the site is under entitlement review for industrial development . The property to the south of the Project site is located within the City of Chino and is developed with the Chino Airport.

The property to the north of the Project site is located within the Medium Density Residential (5.1-11 dwelling units per acre) zoning district and is partially developed with agricultural and dairy land uses . The existing surrounding land us es, zoning, and Policy Plan ( general plan ) and specific plan land use designations are summarized in the "Surrounding Zoning & Land Uses" table located in the Technical Appendix of this report.

P
ROJECT ANALYSIS:
(
1) Background — The Ontario Plan (“TOP”) Policy Plan (general plan) provides the basic framework for development within the 8,200 -acre area commonly referred to as Ontario Ranch. The Policy Plan requires City Council approval of a Specific Plan for new developments of 10 acres or more within Ontario Ranch. A Specific Plan is required to ensure that sufficient land area is included to achieve cohesive, unified districts and neighborhoods, as well as to incorporate development framework for detailed land use, circulation, infrastructure improvements, public service provisions, and urban design and landscape standards.

On M
arch 1, 2022, the City Council approved the South Ontario Logistics Center Specific Plan (File No. PSP19-001) and associated Environmental Impact Report (State Clearinghouse No. 2021010318), inclusive of the Project site. However, a writ of mandate challenging the project (File No. PSP19-001) was filed on March 30, 2022, and a settlement agreement was entered into by the applicant and the challenger on October 14, 2022.

A major term of the settlement agreement was to remove the San Bernardino County owned parcels (Project site) from the Specific Plan. Thus, the applicant filed for a Specific Plan Amendment on December 6, 2022, to remove the 71.6-acres of San Bernardino County owned land from the Specific Plan . Subsequently, the City initiated a Zone Change Amendment to re-establish zoning on the 71.6-acre Project Site to replace the Specific Plan zoning.
(
2) Specific P lan Amendment — The Specific Plan Amendment consists of map and text changes to accommodate remov al of 71.6-acres of land from South Ontari o L
ogistics Center Specific Plan. The overall Specific Plan acreage will get reduced from 219.39 acres to 147.85 acres (see Figure 2: Specific Plan Table 1.0 Land Use Summary) .

T
he Specific Plan Amendment includes adjustments to the Specific Plan boundaries, total acreage and buildout, development phasing, street and landscape sections, circulation, and utilities (see Attachment A to the Specific Plan Resolution – Specific Plan Amendment Redlined Document , as well as Exhibit B : Specific Plan Land Use Plan Revision ). The Specific Plan has also been updated to reflect more current and accurate development information within the remainder of the specific plan area. No changes are proposed to the general development and design standards aside from removal of Campus Avenue standards that no longer apply.
1056
Planning Commission Agenda Report
File Nos.: PSPA22-008 and PZC23-001
April 25, 2023

Page 3 of 9 ends

(3) Zone Change — All properties within the City must have a specific plan land use or zoning district assigned to it, and all specific plans and zoning districts within the City must be consistent with TOP’s Land Use Plan. As a result of the Specific Plan Amendment, which will remove a portion of land from the Specific Plan, a Zone Change must also be processed to re-establish zoning for the Project site. Prior to establishment of the South Ontario Logistics Center Specific Plan, the Project site was zoned SP(AG) (Specific Plan – Agricultural Overlay). As such, staff is proposing that the Project site zoning revert back to the previous SP(AG) zoning designation to allow for interim agricultural activities until a specific plan is established for the 71.6- acre Project Site (see Exhibit C: Zoning Map Change). The proposed S P(AG) zoning designation is consistent with the current TOP Land Use Plan, as it allows for interim agricultural activities.

PUBLIC NOTIFICATION: Th e subject application was advertised as a public hearing in at least one newspaper of general circulation in the City of Ontario (the Inland Valley Daily Bulletin newspaper). In addition, the Project site was posted with one or more large public notification signs and notices were mailed to all owners of real property located within a minimum of 300 feet of the exterior boundaries of the property that is the subject of the hearing, as shown on the records of the County Assessor.

CO
RRESPONDENCE: As of the preparation of this Resolution, Planning Department staff has not received any written or verbal communications from the owners or occupants of properties surrounding the Project site or from the public in general, regarding the subject application.

AGENCY/DEPARTMENT REVIEWS: Each City agency/department has been provided the opportunity to review and comment on the subject application and recommend conditions of approval to be imposed upon the application. At the time of the Resolution preparation, recommended conditions of approval were provided and are appended to the attached Specific Plan Amendment and Zone Change resolution as "Attachment B.”

Table 1.0 Land Use Summary
Land Use Designation Acreage Maximum Building Square
Footage

Business Park Planning Areas 35.17 23.65 AC

919,048 618,116.4 SF

Industrial – General Planning
Areas 184.22 124.20 AC

1,923,102 2,975,583.6 SF

Total 219.39 147.85 AC 2,541,178 3,593,700 SF
Figure 2: Specific Plan Table1.0 Land Use

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AIRPORT LAND USE COMPATIBILITY PLAN (ALUCP) COMPLIANCE: The California State Aeronautics Act (Public Utilities Code Section 21670 et seq.) requires that an Airport Land Use Compatibility Plan be prepared for all public use airports in the State; and requires that local land use plans and individual development proposals must be consistent with the policies set forth in the adopted Airport Land Use Compatibility Plan.

On April 19, 2011, the City Council of the City of Ontario approved and adopted the ONT ALUCP, establishing the Airport Influence Area for Ontario International Airport, which encompasses lands within parts of San Bernardino, Riverside, and Los Angeles Counties, and limits future land uses and de velopment within the Airport Influence Area, as they relate to noise, safety, airspace protection, and overflight impacts of current and future airport activity. As the recommending body for the Project, the Planning Commission has reviewed and considered the facts and information contained in the Application and supporting documentation against the ONT ALUCP compatibility factors, including [1] Safety Criteria (ONT ALUCP Table 2-2) and Safety Zones (ONT ALUCP Map 2-2), [2] Noise Criteria (ONT ALUCP Table 2 -3) and Noise Impact Zones (ONT ALUCP Map 2 -3), [3] Airspace protection Zones (ONT ALUCP Map 2 -4), and [4] Overflight Notification Zones (ONT ALUCP Map 2 -5). As a result, the Planning Commission, therefore, finds and determines that the Project , when imple mented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the ONT ALUCP.

On August 2, 2022, the City Council of the City of Ontario approved and adopted a Development Code Amendment to establish the Chino Airport ("CNO") Overlay Zoning District ("OZD") and Reference I, Chino Airport Land Use Compatibility Plan ("CNO ALUCP"). The CNO OZD and CNO ALUCP established the Airport Influence Area for Chino Airport, solely within the City of Ontario, and limits future land uses and development within the Airport Influence Area, as they relate to safety, airspace protection, and overflight impacts of current and future airport activity. The CNO ALUCP is consistent with policies and criteria set forth within the Caltrans 2011 California Airport Land Use Planning Handbook. The proposed Project is located within the Airport Influence Area of Chino Airport and was evaluated and found to be consistent with the California Airport Land Use Planning Handbook and the CNO ALUCP. As the recommending body for the Project, the Planning Commission has reviewed and considered the facts and information contained in the Application and supporting documentation against the CNO ALUCP compatibility factors, including Safety, Airspace Protection, Overflight. As a result, the Planning Commission, therefore, finds and determines that the Project, when implemented in conjunction with the conditions of approval, will be consistent with the policies and criteria set forth within the California Airport Land Use Planning Handbook and the Chino ALUCP.

COMPLIANCE WITH THE ONTARIO PLAN: The proposed Project is consistent with the principles, goals and policies contained within the Vision, Governance, Policy Plan (general plan), and City Council Priorities components of The Ontario Plan ("TOP"). More specifically, the goals and policies of TOP that are furthered by the proposed Project are as follows:
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(1) City Council Goals.

 Operate in a Businesslike Manner
 Ensure the Development of a Well Planned, Balanced, and Self-Sustaining Community in the New Model Colony

(2) G overnance.

Decision Making:

 Go al G1 : Sustained decision-making that consistently moves Ontario towards its Vision by using The Ontario Plan as a framework for assessing choices.

(3) Po licy Plan (General Plan)

Land Use Element:

 G oal LU -2 Compatibility: Compatibility between a wide range of uses and a resultant urban patterns and forms.

H
OUSING ELEMENT COMPLIANCE: The Project is consistent with the Housing Element of the Policy Plan (general plan) component of The Ontario Plan, as the Project site is not one of the properties in the Housing Element Sites contained in Tables B- 1 and B-2 (Housing Element Sites Inventory) of the Housing Element Technical Report.

ENVIRONMENTAL REVIEW: The environmental impacts of this Project were previously reviewed in conjunction with the South Ontario Logistics Center Specific Plan (File No.

PSP19-001), for which an Environmental Impact Report (“EIR”, State Clearinghouse No. 2021010318) was adopted by the City Council on March 1, 2022. This Application introduces no new significant environmental impacts. Substantial changes are not proposed with the Project which would require major or any revisions to the previous EIR due to the involvement of no new significant environmental effects or no new substantial increase in the severity of previously identified significant effects. All previously adopted mitigation measures have not changed and are a condition of Project approval and are incorporated herein by this reference. As the Project is reverting the zoning designation back to the status quo (SP (AG) Overlay), impacts of which were analyzed in the EIR as an alternative to establishment of the South Ontario Logistics Center Specific Plan.

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TECHNICAL APPENDIX:

Surrounding Zoning and Land Use:

Existing
Land Use
Policy Plan
Designation
Zoning
Designation
Specific Plan
Land Use
Site Agricultural, Dairy, and
Vacant
Business Park (0.6 FAR)
and Industrial (0.55 FAR)
South Ontario Logistics
Center Specific Plan
(existing)
SP (AG Overlay)
(proposed)
Business Park and
Industrial General
North Agricultural, Dairy, and
Vacant
Medium Density
Residential (11.1-25
du/ac)
SP (AG Overlay) N/A
South Chino Airport N/A N/A N/A
East Agricultural, Dairy, and
Vacant
Business Park (0.6 FAR)
and Industrial (0.55 FAR)
South Ontario Logistics
Center Specific Plan
Business Park and
Industrial General
West Agricultural, Dairy, and
Vacant
Business Park (0.6 FAR)
and Industrial (0.55 FAR)
Ontario Ranch Business
Park Specific Plan
Business Park and
Industrial General

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Exhibit A: PROJECT LOCATION MAP

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Exhibit B: SPECIFIC PLAN LAND USE PLAN REVISION

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Exhibit C: ZONING MAP CHANGE

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RESOLUTION NO. PC23-029

A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF

ONTARIO, CALIFORNIA, RECOMMENDING THAT THE CITY COUNCIL APPROVE FILE NO. PSPA22-008, A REQUEST TO AMEND THE SOUTH

ONTARIO LOGISTICS CENTER SPECIFIC PLAN, INCLUDING MAP AND TEXTUAL CHANGES TO REMOVE A 71.6-ACRE PORTION OF LAND

GENERALLY LOCATED SOUTH OF EUCALYPTUS AVENUE, NORTH

OF MERRILL AVENUE, WEST OF BON VIEW AVENUE, AND EAST OF

CAMPUS AVENUE FROM THE SPECIFIC PLAN, IN CONJUNCTION
WITH A ZONE CHANGE (FILE NO. PZC23 -001) TO ESTABLISH THE

SP(AG) ZONING DISTRICT ON THE PROJECT SITE , AND MAKING FINDINGS IN SUPPORT THEREOF —APNS: 1054-051-01, 1054-051-02, 1054-061-01, 1054-061-02, 1054-251-01, 1054-251-02, 1054-301-01, AND 1054-301-02.

WHEREAS, GROVE LAND VENTURE, LLC. ("Applicant") has filed an Application for the approval of a Specific Plan Amendment , File No. PSPA22 -008, as described in the title of this Resolution (hereinafter referred to as "Application" or "Project"); and

WHEREAS, the Application applies to 71.6 acres of land owned by the County of San Bernardino and is generally located south of Eucalyptus Avenue, north of Merrill Avenue, west of Bon View Avenue, and east of Campus Avenue, currently within the South Ontario Logistics Center Specific Plan, and is presently partially improved with agricultural uses and partially vacant; and

WHEREAS, the property to the east of the Project site is located within the South Ontario Logistics Center Specific Plan and is currently vacant, as the site is under entitlement review for industrial development. The property to the west of the Project site is located within the Ontario Ranch Business P ark Specific Plan and is currently vacant, as the site is under entitlement review for industrial development. The property to the south of the Project site is located within the City of Chino and is developed with the Chino Airport. The property to the north of the Project site is located within the Medium Density Residential (5.1-11 dwelling units per acre) zoning district and is partially developed with agricultural and dairy land uses and is partially vacant; and

WHEREAS, the Specific Plan Amendment has been filed in conjunction with a Zone Change application, File No. PZC23 -001, and approval of the Specific Plan Amendment is contingent on City Council approval of the related Zone Change application; and

WHEREAS, on March 1, 2022, the City Council appr oved the South Ontario Logistics Center Specific Plan (File No. PSP19- 001) and associated Environmental Impact Report (State Clearinghouse No. 2021010318), inclusive of the Project site; and 1064
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WHEREAS, a writ of mandate challenging the Specific Plan project was filed on March 30, 2022, and a settlement agreement was entered into by the A pplicant and the challenger on October 14, 2022; and

WHEREAS, a major term of the settlement agreement was to remove the San Bernardino County -owned parcels ( Project site ) from the Specific Plan. Thus, the Applicant filed for a Specific Plan Amendment on December 6, 2022, to remove the 71.6 acres of San Bernardino County -owned land from the Specific Plan. Subsequently, the City initiated a Zone Change Amendment to re-establish zoning on the 71.5-acre Project site to replace the Specific Plan zoning; and

WHEREAS, the Specific Plan Amendment consists of map and text changes to accommodate removal of the Project site from the overall Specific Plan area, including adjustments to the Specific Plan boundaries, total acreage and buildout, development phasing, street and landscape sections, circulation, and utilities (see Attachment A – Specific Plan Amendment Redlined Document). The Specific Plan has also been updated to reflect more current and accurate development information within the remainder of the specific plan area. No changes are proposed to the general development and design standards, aside from removal of those which no longer apply; and

WHEREAS, the environmental impacts of this Project were previously reviewed in conjunction with File No. PSP19 -001, the South O ntario Logistics Center Specific Plan for which an Environmental Impact Report — State Clearinghouse No. 2021010318 — (hereinafter referred to as " Certified EIR") was adopted by the City Council on March 1, 2022, and this Application introduces no new significant environmental impacts . The Certified EIR analyzed the impacts of the status quo (SP (AG) (Specific Plan – Agricultural Overlay)) as an alternative to establishment of the South Ontario Logistics Center Specific Plan; and

WHEREAS, the City 's "Local Guidelines for the Implementation of the California Environmental Quality Act (CEQA) " provide for the use of a single environmental assessment in situations where the impacts of subsequent projects are adequately analyzed; and

WHEREAS, Ontario Development Code Table 2.02-1 (Review Matrix) grants the Planning Commission the responsibility and authority to review and make recommendation to the City Council on the subject Application; and

WHEREAS, the Project has been reviewed for consistency with the Housing Element of the Policy Plan component of The Ontario Plan, as State Housing Element law (as prescribed in Government Code Sections 65580 through 65589.8) requires that development projects must be consistent with the Housing Element, if upon consideration 1065
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of all its aspects, it is found to further the purposes, principals, goals, and policies of the Housing Element; and

WHEREAS, the Project is located within the Airport Influence Area of Ontario International Airport, which encompasses lands within parts of San Bernardino, Riverside, and Los Angeles Counties, and is subject to, and must be consistent with, the policies and criteria set forth in the Ontario International Airport Land Use Compatibi lity Plan (hereinafter referred to as "ALUCP"), which applies only to jurisdictions within San Bernardino County, and addresses the noise, safety, airspace protection, and overflight impacts of current and future airport activity; and

WHEREAS, City of Ont ario Development Code Division 2.03 (Public Hearings) prescribes the manner in which public notification shall be provided and hearing procedures to be followed, and all such notifications and procedures have been completed; and

WHEREAS, on April 25, 2023, the Planning Commission of the City of Ontario conducted a hearing to consider the Project, and concluded said hearing on that date; and

WHEREAS, all legal prerequisites to the adoption of this Resolution have occurred.

NOW, THEREFORE, IT IS HEREBY FOUND, DETERMINED, AND RESOLVED by the Planning Commission of the City of Ontario, as follows:

SECTION 1: Environmental Determination and Findings. As the recommending authority for the Project, the Planning Commission has reviewed and considered the information contained in the previous Certified EIR and supporting documentation. Substantial changes are not proposed with the Project which would require major or any revisions to the previous EIR due to the involvement of no new significant environmental effec ts or no new substantial increase in the severity of previously identified significant effects. Based upon the facts and information contained in the previous Certified EIR and supporting documentation, the Planning Commission finds as follows:

(1) The environmental impacts of this project were previously reviewed in conjunction with File No. PSP19-001, the South Ontario Logistics Center Specific Plan for which a Certified EIR was adopted by the City Council on March 1, 2023; and

(2) The previous Certified EIR contains a complete and accurate reporting of the environmental impacts associated with the Project; and

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(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 judgment of the Planning Commission; and

(5) The proposed 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 2: Subsequent or Supplemental Environmental Review Not Required. Based on the information presented to the Planning Commission, and the specific findings set forth in Section 1 , above, the Planning Commission 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 the 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 City declined to adopt such measures; or

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Ontario City CouncilMay 16, 2023

Ontario City Council
May 16, 2023