Agenda packet — Shafter City Council, May 19, 2026 (part 2 of 4)

21 Agreement, in conjunction with each anticipated phase of Development of the Property, subject to all relevant provisions of this Agreement.

7.5.2 Landscaping Improvements. Owner shall, at its sole cost, expense and liability, construct those certain landscaping improvements required by the Mission Lakes Specific Plan found to be in substantial conformance by the City Engineer. Owner shall Dedicate any required improvements to the City at the time of recordation of the final map for which the improvements were a condition of approval. Owner will construct such landscaping improvements in accordance with City and other applicable governmental agency rules, codes, standards, ordinances and regulations in accordance with the Existing Land Use Regulations, subject to the Reservations of Authority.

7.5.3 Flood Control and Storm Drainage Improvements. Owner shall, at its sole cost, expense and liability, construct those certain flood control and storm drainage improvements required by the Mission Lakes Specific Plan found to be in substantial conformance by the City Engineer. Owner shall Dedicate any required improvements to the City at the time of recordation of the final map for which the improvements were required. Owner will construct such flood control and storm drainage improvements in accordance with City and other applicable governmental agency rules, codes, standards, ordinances and regulations in accordance with the Existing Land Use Regulations, subject to the Reservations of Authority.

7.5.4 Public Utilities Impact Measures. Contemporaneously with or prior to the approval of each final map applicable to the Project, Owner shall provide written evidence, acceptable to City, that Owner has fully satisfied all public utilities impact measures lawfully required by any public utility purveyor, including, without limitation, phone, water, electric, cable television and gas, which will service that portion of the Project. Failure to provide such evidence will result in disapproval of any final map.

7.6 Alternative Improvements Interests. City and Owner acknowledge and agree that the potential acquisition of real property and other interests necessary for the construction of the Public Improvements described in Section 7.5 of this Agreement is subject to the provisions of Section 6.7. If, due to any reason whatsoever, Owner is unable to construct those Public Improvements described in Section 7.5 of this Agreement and meeting the definition of an Offsite Improvement due to the inability of either Owner or City to acquire the necessary real property or other interests to allow such construction, then Owner shall construct alternative improvements of an equal or greater value than those improvements which would have been constructed had the necessary property and other interests been obtained or pay an in-lieu fee, if applicable. The value of such alternative improvements shall be as determined in the City’s reasonable discretion, consistent with the programs, studies and reports substantiating the amount of development impact fees adopted by the City. Construction of the alternative improvements shall be in accordance with plans and specifications approved by City in accordance with all codes, ordinances, regulations, standards and policies in effect at the time of the construction of the improvements.

7.7 Environmental Site Inspection. Owner hereby grants to the City, its agents, contractors, employees and other representatives the right to enter upon the Property during reasonable business hours for purposes including, without limitation, the surveying, inspecting, photographing, sampling, and other testing necessary, in the City’s absolute discretion, to the

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22 determination of whether hazardous or toxic pollutants, contaminants or materials (collectively, “environmental contaminants”) are located upon any property which the City will be receiving through Dedication including, without limitation, parks, rights of way, and utility easements. Upon discovery of any environmental contamination, Owner shall immediately cease any work that may have begun upon the Project, will notify all appropriate governmental authorities and regulatory agencies, and will take all steps necessary to comply with any provisions of any federal or state environmental laws, including the Comprehensive Environmental Response, Compensation and Liability Act, the Resource Conservation and Recovery Act, the Toxic Substances Control Act, and all other federal or state statutes of similar import and effect.

7.8 Dedication. The term “Dedicate” as used in this Article 7 means to acquire and offer the subject land for dedication and to construct the improvements to be constructed by the Owner on such land pursuant to Section 7.5 of this Agreement and thereafter to convey such land and improvements to the City. Owner shall convey the land on which the Public Improvements are to be constructed in coordination with the anticipated phasing of Development of the Property as identified by the Public Improvement Phasing Plan included as Exhibit E of this Agreement, but in no event later than the recordation of the final tract map for which such Public Improvement(s) was/were a condition of approval. Owner shall Dedicate/convey easement interests in all property required to be Dedicated by this Agreement. The Owner shall Dedicate each Public Improvement upon completion of a segment component of such Public Improvement.

7.9 Minimum Dwelling Unit Size. Owner agrees that the minimum single-family dwelling unit size permitted in the Project’s subdivisions shall be no less than 850 square feet of living space. The minimum square foot requirement excludes garages, patios and/or porches whether enclosed or not.

7.10 Fiber Optic and Networking Installation for Dwelling Units. Owner agrees to install in each dwelling unit the following fiber optic and networking requirements:

7.10.1 Building Department Requirements
(a) Install a dedicated City Fiber Enclosure adjacent to the other utility enclosures or a Common Communication Enclosure (collectively “Utility Enclosure”) for the proposed communications utilities (phone, cable, fiber, etc.). The enclosure type shall be BennerNawman 14326W-UL or as approved by the City. The Utility Enclosure may face the garage exterior or interior and shall include one 120-volt, 15-amp convenience receptacle inside the enclosure mounted on either side of the wall. A surge-protected receptacle must be installed. (b) Install a wireless-transparent Structured Media Enclosure (“Media Enclosure”), such as models: Legrand 30” ENP3050, Legrand 42” ENP4250, Leviton 30” 49605- 30W, Primex Verge 30” P3000, 42” Primex Verge P4200, or as approved by the City. The Media Enclosure shall be installed in the wall of a master bedroom closet or a laundry room furthest from the water supply and maintain a minimum 48-inch horizontal clearance between and 24-inch clearance above any metallic appliances or accessories. The Media Enclosure shall include one 120-volt, 15-amp convenience receptacle located inside the enclosure.

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23 (c) Install a conduit pathway from the Utility Enclosure to the Media Enclosure with a minimum of one (1) 1-inch diameter non-metallic, flexible conduit which shall maintain a minimum 36-inch bend radius and protrude a minimum of 6-inches into the enclosures. The conduit shall be marked with orange Tyvek or plastic tags, labeled “City Fiber Use Only”, 661- 746-5000”, tie wrapped to the conduit in plain view within the enclosures. (d) Install a continuous conduit without breaks or couplings from the existing City Fiber Distribution Enclosure located in the right-of-way (“Distribution Enclosure”) to the bottom side of the Utility Enclosure. The conduit shall be installed a minimum of 36-inches below grade, protrude a minimum of 12-inches into the Utility Enclosure, be orange in color, and be factory labeled “City of Shafter 661-746-5000”. If the conduit does not have an integrated tracer wire, a continuous external #12 AWG solid-conductor tracer wire with high-density polyethylene insulation rated for direct burial shall be installed along with the conduit leaving a minimum 15- feet of slack coiled in the Distribution Enclosure and 3-feet of slack coiled in the Utility Enclosure.

The conduit and tracer wire shall be inspected by a City of Shafter representative before shading and backfilling.
(e) After backfilling, polyester cable pulling tape (Muletape), or equivalent, shall be installed in all conduit paths between the Distribution Enclosure and the Utility Enclosure.

Mule tape shall be slack (no tension) and fastened to the plug or cap. (f) Couplings shall be used to repair damaged or short-length conduit only if approved by the City. Conduit couplings shall be an air-tight, water-tight, push-on compression fitting approved by the City. Tracer wire couplings shall be air-tight, water-tight, twist on or compression connector approved by the City. Coupling integrity shall be inspected by a City of Shafter representative.
(g) Category 6 Unshielded Twisted Pair (CAT 6 UTP) cable (or as approved by the City) shall be installed according to industry standards and the requirements below, and shall not be pinched, stapled, bent sharply, or crossing any sharp, unprotected edges:
(h) Install a minimum of two (2) cables from the Utility Enclosure to the Media Enclosure.

7.10.2 Engineering Department Requirements
(a) Owner shall design and install a system of conduits, terminal enclosures, distribution enclosures, splice enclosures, connection points, and hand holes for a fiber optic network to each buildable lot within the development. Design and material specifications are available from the City of Shafter. Plans shall be submitted to and approved by the City of Shafter, prior to recordation of the final map, showing the proposed utility trench and all appurtenant hardware. The design shall include the following minimum specifications:
(i) A combination of fiber optic conduits shall minimally include 4” SDR-11 HDPE, 2” SDR-11 HDPE, 1.25” SDR-11 HDPE, and 7-Way bundled HPDE innerduct with attached tracer wire. Fiber optic conduits may be joint-trenched with other utility company pipes and/or conduits.

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24 (ii) All underground fiber optic conduits, innerduct bundles, etc. shall be factory-labeled “City of Shafter 661-746-5000”. Conduits shall be identified by a permanent marking, with the address number of the residence they serve, within the distribution enclosures. (iii) All underground fiber optic conduit paths shall have tracer wire. If the conduit does not have an integrated tracer wire, a continuous external #12 AWG solidconductor tracer wire with high-density polyethylene insulation rated for direct burial shall be installed along with the conduit leaving a minimum 15-feet of slack coiled in the endpoint enclosures.
(iv) The ends of all fiber optic conduits, innerducts, and microducts shall be plugged or capped to prevent dirt, debris, or foreign objects from entering. (v) After backfilling, all conduits shall be checked for obstructions, and re-excavated and repaired or replaced as required. All conduits ½-inch or larger shall require polyester cable pulling tape or equivalent installed. Mule tape shall be slack (no tension) and fastened to the plug or cap. Innerducts and microducts shall be mandrel tested while being witnessed by a City of Shafter Public Works Department representative. (vi) A combination of underground utility enclosures shall minimally include 36”W x 60”L x 36”D polymer concrete enclosures with dual torsion covers, 36”W x 36”L x 24-36”D and 24”W x 36”L x 24-36”D High Density Polyethylene (HDPE) enclosures. (vii) All underground utility enclosures shall be factory-stamped “City Fiber”.

ARTICLE 8. FINANCING OF PUBLIC IMPROVEMENTS AND

MAINTENANCE OBLIGATIONS

8.1 Maintenance Services Community Facilities District. The City and Owner agree to the formation of a new, or annexation to an existing, CFD pursuant to the terms of the MelloRoos Community Facilities Act of 1982, being Chapter 2.5 of Part 1 of Division 2 of Title 5 of the California Government Code commencing with section 53311, as amended (the “Act”). The territory of which shall include the Project, for the purposes of the payment of the ongoing maintenance and operation costs associated with certain public services authorized under the Act (“Services”) located within, or appurtenant to, the Project. Owner shall consent to the annexation or the formation of the CFD prior to recordation of the first final map for the Project or the first sale, transfer or conveyance of the Property or any portion thereof. Owner further expressly agrees that failure of Owner to consent to the annexation or formation of such CFD will result in disapproval of any future tentative or final maps for the Project and will be cause for the City to terminate this Agreement.

Owner also agrees that additional areas may be annexed into the CFD to be created pursuant to this Section 8.1; provided, however, that after giving effect to such annexation, Owner is subject only to its fair share of the obligations and costs of providing the ongoing maintenance of the Services incurred for the Project. Owner agrees to cooperate fully in any such annexation proceedings.

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25 8.2 Public Safety Community Facilities District. The City and Owner agree to the formation of a new, or the annexation to an existing, CFD pursuant to the terms of the Act, the territory of which shall include the Project, for the purposes of the payment of the ongoing costs associated with providing police protection, fire protection and suppression services, and other public services as authorized by the Act (“Public Services”). Owner shall consent to the annexation or the formation of the CFD prior to recordation of the first final map for the Project or the first sale, transfer or conveyance of the Property or any portion thereof. Owner further expressly agrees that the failure of Owner to consent to the annexation or formation of such CFD will result in disapproval of any future tentative or final maps for the Project and will be cause for the City to terminate this Agreement.

Owner also agrees that additional areas may be annexed into the CFD to be created pursuant to this Section 8.2; provided, however, that after giving effect to such annexation, the Owner is subject only to its fair share of the obligations and costs incurred because of providing the Public Services. The Owner agrees to cooperate fully in any such annexation proceedings.

Owner agrees that the Public Safety Community Facilities District may be formed as part of or separate from the Maintenance Services Community Facilities District described in Section 8.1 of this Agreement, at the City’s discretion.

ARTICLE 9. REVIEW FOR COMPLIANCE.

9.1 Periodic Review. The City Manager, or his or her designee, shall review this Agreement annually on or before the anniversary of the Effective Date, in order to ascertain the good faith compliance by Owner with the terms of the Agreement. Owner shall submit an Annual Monitoring Report, in a form acceptable to, and containing such information as may be requested by the City Manager, or his or her designee, within 30 days after written notice from the City Manager, or his or her designee. The Annual Monitoring Report shall be accompanied by an annual review and administration fee, in an amount consistent with then-existing City fee schedules and resolutions, sufficient to defray the estimated costs of review and administration of the Agreement during the succeeding year. The amount of the annual review and administration fee shall be set annually by resolution of the City Council. Neither City nor Owner shall have a duty to notify the other of their respective obligations hereunder and the City’s failure to so conduct such annual reviews shall not affect the rights, protection, and benefits afforded Owner by the Development Agreement Law and this Agreement shall remain subject to the Development Agreement Law.

9.2 Special Review. The Planning Commission or City Council may order a special review of compliance with this Agreement at any time. The City Manager, or his or her designee, shall conduct such special reviews.

9.3 Procedure.
(a) During either a periodic review or a special review or at any time upon City’s determination that Owner is in default of this Agreement as described in Section 10.4,

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26 Owner shall be required to demonstrate good faith compliance with the terms of the Agreement.

The burden of proof on this issue shall be on Owner.
(b) Upon completion of a periodic review or a special review, the City Manager, or his or her designee, shall submit a report to the Planning Commission setting forth the evidence concerning good faith compliance by Owner with the terms of this Agreement and his/her recommended finding on that issue.
(c) If the Planning Commission finds on the basis of substantial evidence that Owner has complied in good faith with the terms and conditions of this Agreement, the review shall be concluded.
(d) If the Planning Commission makes a preliminary finding that Owner has not complied in good faith with the terms and conditions of this Agreement, the Planning Commission may recommend to the City Council that the City Council commence proceedings to modify or terminate this Agreement and the City Council may proceed to modify or terminate this Agreement under Section 9.4 and Section 9.5. Notice of default and opportunity to cure as provided under Section 10.4 of this Agreement shall be given to Owner prior to or concurrent with proceedings under Section 9.4 and Section 9.5.

9.4 Proceedings Upon Modification or Termination. If, upon a recommendation of the Planning Commission under Section 9.3(d), the City Council determines to proceed with modification or termination of this Agreement, the City Council shall give written notice to Owner of its intention so to do. The notice shall be given at least ten calendar days prior to the scheduled hearing and shall contain:
(a) The time and place of the hearing;
(b) A statement as to whether or not the City Council proposes to terminate or to modify the Agreement; and the specifics of such modifications; (c) Such other information as is reasonably necessary to inform Owner of the nature of the proceeding.

9.5 Hearing on Modification or Termination. At the time and place set for the hearing on modification or termination, Owner shall be given an opportunity to be heard. Owner shall be required to demonstrate good faith compliance with the terms and conditions of this Agreement. The burden of proof on this issue shall be on Owner. If the City Council finds, based upon substantial evidence, that Owner has not complied in good faith with the terms or conditions of the Agreement the City Council may terminate this Agreement notwithstanding any other provision of this Agreement to the contrary, or modify this Agreement and impose such conditions as are reasonably 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.

9.6 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 request by Owner, issue a Certificate of Agreement Compliance (“Certificate”) to Owner stating that after

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27 the most recent Periodic or Special Review and based upon the information known or made known to the Planning Commission 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 of 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 City Manager.

ARTICLE 10. DEFAULT AND REMEDIES.

10.1 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 City shall not be liable in damages, including, without limitation, attorneys’ fees and litigation costs, to Owner, or to any mortgagee or lender of Owner or to a successor in interest of Owner, or a mortgagee or lender of Owner, or to any other person, and Owner covenants not to sue for damages or claim any damages:
(a) For any breach of this Agreement or for any cause of action which arises out of this Agreement; or
(b) For the impairment or restriction of any right or interest conveyed or provided under, with, or pursuant to this Agreement, including, without limitation, any impairment or restriction which Owner characterizes as a regulatory taking or inverse condemnation; 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.

Further, nothing contained herein shall modify or abridge Owner’s rights or remedies (including its rights for damages, if any) resulting from the exercise by City of its power of eminent domain; provided, however, that such exercise results in a physical occupation of the Property or portion thereof. Except as set forth in the preceding sentence, Owner’s remedies shall be limited to those set forth in this Section 10.1 and Sections 9.5 and 10.2.

10.2 Specific Performance. The parties acknowledge that money damages and remedies at law generally are inadequate, and specific performance and other non- monetary relief, including temporary and permanent injunction relief, are particularly appropriate remedies for the enforcement of this Agreement and should be available to all Parties for the following reasons:
(a) Money damages are unavailable against the City.

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28 (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; the parties acknowledge and agree that any injunctive relief may be ordered on an expedited, priority basis. (c) Owner shall not be required to post a bond to obtain injunctive relief.

10.3 Release. Except for nondamage remedies and except as otherwise provided in this Agreement, including the remedy of specific performance and judicial review as provided for in Section 9.5, 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 or 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, ordinance, or judicial decision 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.

Without limiting the generality of anything in the immediately preceding paragraph, Owner, for itself and its successors and assigns, hereby expressly waives the benefit of, and any protections provided by Civil Code Section 1542, which provides:

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 AND THAT, IF

KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY

AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR
OR RELEASED PARTY.

BY INITIALING BELOW, OWNER HEREBY WAIVES THE PROVISIONS OF SECTION 1542 IN CONNECTION WITH THIS SECTION 10.3:

Owner’s Initials, Suburban Land Reserve, Inc.

Owner’s Initials, Millrose Properties California, LLC
Owner’s Initials, 7th Standard Ranch Investors LLC

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(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 detennine the sum of money which would adequately compensate Owner for such efforts; the parties acknowledge and agree that any injunctive relief may be ordered on an expedited, priority basis. (c) Owner shall not be required to post a bond to obtain injunctive relief.

10.3 Release. Except for nondamage remedies and except as otherwise provided in this Agreement, including the remedy of specific performance and judicial review as provided for in Section 9. 5, 0-WTier, for itself, its successors and assignees, hereby releases the City, its officers, agents and employees from any and all claims, demands, actions, or suits or 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, ordinance, or judicial decision 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.

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 AND THAT, IF

KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY

AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR
OR RELEASED PARTY.

BY INITIALING BELOW, OWNER HEREBY WAIVES THE PROVISIONS OF SECTION 1542 IN CONNECTION WITH THIS SECTION 10. 3:

Owner's Initials, Suburban Land Reserve, Inc.

Owner's Initials, Millro e Properties California, LLC
Owner's Initials, 7th andard Ranch Investors LLC
28

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29 In addition to waiving the provisions of California Civil Code section 1542, the Owner hereby waives, releases and foregoes the provisions of any federal or state statute or judicial decision of similar effect.

10.4 Termination or Modification for Default of Owner. City may terminate or modify this Agreement for any failure of Owner to perform any material duty or obligation of Owner under this Agreement as provided in Article 6 hereof, 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 in accordance with Article 6 hereof 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 sixty (60) days after the effective date of such notice or, in the event that such default cannot be cured within such sixty (60) day period but can be cured within a longer time, has failed to commence the actions necessary to cure such default within such sixty (60) day period and to diligently proceed to complete such actions and cure such default.

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

ARTICLE 11. THIRD PARTY LITIGATION.

11.1 General Plan Litigation. City has determined that this Agreement and the Mission Lakes Specific Plan are consistent with its 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 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 Mission Lakes Specific Plan, which failure to perform or inability to develop is 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, or that this Agreement or any of City’s actions in adopting it were invalid, inadequate or not in compliance with law.

11.2 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

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30 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.

11.3 Indemnity. In addition to and not as a limitation upon the provisions of Sections

11.1 and 11.2 above, Owner shall indemnify, defend and hold harmless City, its officers, agents, employees and independent contractors free and harmless from all liability whatsoever, based or asserted upon any act or omission of Owner, its officers, agents, employees, subcontractors and independent contractors, for property damage, bodily injury or death (Owner’s employees included) or any other element of damage of any kind or nature, relating to or in any way connected with or arising from the activities contemplated hereunder including, but not limited to, the design, engineering, construction, completion, operation, maintenance, repair, failure, conveyance or physical condition of the Public Improvements.

The foregoing obligation shall not apply to any claims for damages which arise through the sole active negligence or sole willful misconduct of City. Owner shall defend, at its sole cost, expense and liability, including attorneys’ fees, City, its officers, agents, employees and independent contractors in any legal action based upon such alleged acts or omissions of Owner.

City may, in its discretion, participate in the defense of any such legal claim, action or proceeding and shall be entitled to reimbursement from Owner for any and all costs associated with such defense including, without limitation, reasonable attorneys’ fees.

11.4 Environmental Contamination. Owner shall indemnify and hold City, its officers, agents, and employees free and harmless from any liability, based or asserted, upon any act or omission of Owner, its officers, agents, employees, subcontractors, predecessors in interest, successors, assigns and independent contractors, excepting any acts or omissions of City as successor to any portions of the Property Dedicated or transferred to City by Owner, for any violation of any federal, state or local law, ordinance or regulation relating to industrial hygiene or to environmental conditions on, under or about the Property, including, but not limited to, soil and groundwater conditions, and Owner shall defend, at its expense, including attorneys, fees, 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 claim, action or proceeding.

11.5 City to Approve Counsel. With respect to Sections 11.1, through 11.4, inclusive, 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.

11.6 Survival. The provisions of Sections 11.1 through 11.6 inclusive, shall survive the expiration or early termination of this Agreement.

11.7 No Waiver of Common Law or Statutory Obligations. City and Owner acknowledge and agree that this Agreement shall not constitute a waiver or abridgement of any common law or statutory obligations which Owner may have with respect to indemnification, defense and contribution in the event that any action or proceeding is commenced against City

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31 which is based upon this Agreement or which is in any way related to any actions taken by Owner pursuant to this Agreement.

ARTICLE 12. 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, provided, further, that any modifications of this Agreement are subject to the provisions of Section 5.5 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.
(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 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 Owner 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. However, to the extent that the performance of such covenant by Owner is a condition precedent to the performance of any act by the City, the City shall have no obligation to perform such act hereunder unless and until the Mortgagee performs the covenant of Owner which is the condition precedent to the City’s performance. Although a Mortgagee is not obligated to perform the obligations and covenants of Owner hereunder, if the Mortgagee elects to so perform, such performance shall be in full accordance with the terms of this Agreement. Any sale, transfer or assignment by any Mortgagee in possession shall be subject to the provisions of Section 5.4 of this Agreement.

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32 ARTICLE 13. MISCELLANEOUS PROVISIONS.

13.1 Recordation of Agreement. This Agreement and any amendment or cancellation thereof shall be recorded with the Kern County Recorder by the City Clerk within the period following the Effective Date as required by Section 65868.5 of the Government Code.

13.2 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.

13.3 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 Article 7 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. Notwithstanding the foregoing, the development rights set forth in Article 6 of this Agreement are essential elements of this Agreement and Owner 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.

13.4 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.

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

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

13.7 Joint and Several Obligations. If at any time during the term of this Agreement any part of the Property is jointly owned, in whole or in part, by more than one owner, all obligations of such owners under this Agreement as to that portion of the Property jointly owned shall be joint and several, and the default of any such owner shall be the default of all such owners, except to the extent such portion(s) of the Property and associated obligations have been transferred and assigned pursuant to Section 5.4.1 of this Agreement. Notwithstanding the foregoing, no owner of a single lot which has been finally subdivided and sold to such owner as a

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33 member of the general public or otherwise as an ultimate user shall have any obligation under this Agreement except as provided herein.

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

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

13.10 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.

13.11 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, government regulations, or court actions (such as restraining orders or injunctions). 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. The failure of either party to obtain or maintain financing necessary for the performance of its respective obligations and duties hereunder shall not be deemed a cause for an extension of the term of this Agreement or a cause for the extension of time for performance of any such obligation by any party hereunder unless mutually agreed to by the parties in writing.

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

13.13 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.

13.14 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.

13.15 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

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34 County of Kern, State of California. Each Party hereto irrevocably consents to the personal jurisdiction of that court. The City and the Owner each hereby expressly waive the benefit of any provision of federal or state law or judicial decision providing for the filing, removal, or change of venue to any other court or jurisdiction, including, without implied limitation, federal district court, due to any diversity of citizenship between the City and the Owner, due to the fact that the City is a party to such action or proceeding or due to the fact that a federal question or federal right is involved or alleged to be involved. Without limiting the generality of the foregoing, the Owner and the City specifically waive any rights provided to it pursuant to California Code of Civil Procedure Section 394. The Owner acknowledges that the provisions of this Section 13.15 are material consideration to the City for its entry into this Agreement, in that the City will avoid the potential cost, expense and inconvenience of litigating in a distant forum.

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

13.17 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 provisions of this Section

13.17 shall not require the taking of any actions which are prohibited by law or, except as expressly set forth in this Agreement, including, without limitation, Section 6.7, impair the lawful legislative discretion of the City as to those matters to which the law imparts legislative discretion to the City.

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

13.19 Agent for Service of Process. In the event Owner is not a resident of the State of California or is an association, partnership or joint venture without a member, partner or joint venturer resident of the State of California, or is a foreign corporation, then in any such event, Owner shall file with the City Manager or his or her designee, 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 all objections and protests thereto.

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35 13.20 Authority to Execute. The person or persons executing this Agreement on behalf of Owner warrants and represents that he/they have the authority to execute this Agreement on behalf of his/their corporation, partnership or business entity and warrants and represents that he/they has/have the authority to bind Owner to the performance of its obligations hereunder.

13.21 Subsequent Amendment to Authorizing Statute. This Agreement has been entered into in reliance upon the provisions of the statute governing development agreements (Sections 65864 through 65869.5 inclusive) in effect as of the Effective Date. Accordingly, subject to Section 6.5 above, to the extent the subsequent amendment to the Government Code would affect the provisions of this Agreement, such amendment shall not be applicable to the Agreement unless necessary for this Agreement to be enforceable.

13.22 No Personal Obligation/No Completion Obligation. This Agreement in and of itself does not represent a personal obligation of individual officers, directors, and shareholders of Owner, its successors or assigns. Nothing herein contained shall in and of itself be deemed to create an obligation of the Owner, its successors or assigns to complete the development of the entire Project as contemplated, or any particular portion thereof. No officer, official, employee, agent, contractor or attorney of the City shall have any personal liability or obligation for the performance of the City’s obligations hereunder.

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36 SIGNATURE PAGE TO
MISSION LAKES SPECIFIC PLAN DEVELOPMENT AGREEMENT NO. 25-22 CITY:

CITY OF SHAFTER, a California municipal
corporation
By:

Mayor, City of Shafter
ATTEST:

City Clerk
City Manager
APPROVED AS TO LEGAL FORM:

BEST BEST & KRIEGER LLP:

By:

City Attorney

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SIGNATURE PAGE TO
MISSION LAKES SPECIFIC PLAN DEVELOPMENT AGREEMENT NO. 25-22 OWNER:
7th Standard Ranch Investors LLC
PO Box 82515
Bakersfield, CA 93380
By:

Its:

Dated.
/^.r^
-7Z.
t0/-7 -Z-$
41

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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 <2. < )ss.
)
On Oc^to<-r- ~7 (3-0'9^, before me, \|~I&I<L ^>\(Lfp , a Notary Public, personally appeared ^.<- "QSzM.i^.So , who proved to me on the basis of satisfactory evidence to be the person^) whose name(^) is/ayfe subscribed to the within instrument and acknowledged to me that he/s^e/ttyfy executed the same in his/h^r/th^ir authorized capacity(ie;S), and that by his/he't'/thfeir signatures^) on the instmment the person(s), or the entity upon behalf of which the person^) acted, executed the instrument.

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

VIOLA ROrtERO
Notary Public . Ciliforni*
Kwn County
Corn mission »24«1631
My Comm. Expires Aug W, 2027
1 WITNESS y hand and official seal.

Notar}' Public
42

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43 EXHIBIT A
TO DEVELOPMENT AGREEMENT NO. 25-22
Legal Description of the Property

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Prelim (CA/NV) Page 4 157201-001304

LEGAL DESCRIPTION
Real Property in the City of Shafter, County of Kern, State of California, described as follows:

TRACT 1:

PARCELS 1 THROUGH 22, INCLUSIVE, 25 THROUGH 28, INCLUSIVE, 29 THROUGH 31, INCLUSIVE AND "D" OF PARCEL MAP NO. 11314, IN THE CITY OF SHAFFER, COUNTY OF KERN, STATE OF CALIFORNIA, AS PER MAP RECORDED JANUARY 31, 2006 IN BOOK 54, PAGES 149 TO 158 INCLUSIVE, OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM ALL INTERESTS CONVEYED TO TENNECO OIL COMPANY, A DELAWARE CORPORATION, IN ASSIGNMENT AND CONVEYANCE THEREOF RECORDED NOVEMBER 18, 1988, IN BOOK 6183, PAGE 1167 OF OFFICIAL RECORDS, WHICH INTERESTS CAN BE BRIEFLY SUMMARIZED AS

ALL OIL, GAS AND OTHER LIQUID AND GASEOUS HYDROCARBONS AND IN ADDITION THERETO

CARBON DIOXIDE, HYDROGEN, HELIUM, NITROGEN, METHANE, SULFUR (IN EACH CASE IN EITHER

LIQUID OR GASEOUS FORM) AND ANY OTHER LIQUID OR GASEOUS SUBSTANCES, INERT OR

OTHERWISE, OR ANY OF THEM, ANY MINERALS OR OTHER SUBSTANCES PRODUCED IN ASSOCIATION THEREWITH ("HYDROCARBONS") IN, ON OR UNDER THE PREMISES, TOGETHER WITH ALL RIGHTS, PRIVILEGES, DUTIES AND RESPONSIBILITIES IN ANY WAY RELATED THERETO. IT IS ACKNOWLEDGED

THAT THIS RESERVATION IS FULLY SET FORTH IN THE CONVEYANCE REFERRED TO ABOVE AND THAT

TITLE IS SUBJECT TO THAT CONVEYANCE AND NOT SUBJECT TO THIS SUMMARY WHICH IS FOR CONVENIENCE ONLY. SAID ASSIGNMENT AND CONVEYANCE WAS CLARIFIED BY FIRST AMENDMENT THEREOF RECORDED JANUARY 17, 1989, IN BOOK 6200, PAGE 1908 OF OFFICIAL RECORDS.

APN'S: 536-010-20 THROUGH 536-010-24, 536-010-26 THROUGH -536-010-29, 536-010-32, 536-010-34, 536-010-35 THROUGH 536-010-40, 536-010-42 THROUGH 45, 536-010-49 THROUGH 536-010-51, 536-010-63, 536-010-67 THROUGH 536-010-70, 536-010-72, 536-010-73, 536-010-81, 536-010-84, AND 536-010-86 THROUGH 536-010-91
TRACT 2:

PARCELS 23, 24 AND 29 OF PARCEL MAP 11314, IN THE CITY OF SHAFTER, COUNTY OF KERN, STATE OF CALIFORNIA, AS PER MAP RECORDED JANUARY 31, 2006 IN BOOK 54, PAGES 149 THROUGH 158, INCLUSIVE, OF PARCEL MAPS OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM ALL INTERESTS CONVEYED TO TENNECO OIL COMPANY, A DELAWARE CORPORATION, IN ASSIGNMENT AND CONVEYANCE THEREOF RECORDED NOVEMBER 18, 1988, IN BOOK 6183, PAGE 1167, OF OFFICIAL RECORDS, WHICH INTERESTS CAN BE BRIEFLY SUMMARIZED AS

ALL OIL, GAS AND OTHER LIQUID AND GASEOUS HYDROCARBONS, AND IN ADDITION THERETO

CARBON DIOXIDE, HYDROGEN, HELIUM, NITROGEN, METHANE, SULFUR (IN EACH CASE IN EITHER

LIQUID OR GASEOUS FORM) AND ANY OTHER LIQUID OR GASEOUS SUBSTANCES, INERT OR

OTHERWISE, OR ANY OF THEM, AND ANY MINERALS OR OTHER SUBSTANCES PRODUCED IN ASSOCIATION THEREWITH ("HYDROCARBONS") IN, ON OR UNDER THE PREMISES, TOGETHER WITH

ALL RIGHTS, PRIVILEGES, DUTIES AND RESPONSIBILITIES IN ANY WAY RELATED THERETO, IT IS

ACKNOWLEDGED THAT THIS RESERVATION IS FULLY SET FORTH IN THE CONVEYANCE REFERRED TO

ABOVE AND THAT TITLE IS SUBJECT TO THAT CONVEYANCE AND NOT SUBJECT TO THIS SUMMARY WHICH IS FOR CONVENIENCE ONLY. SAID ASSIGNMENT AND CONVEYANCE WAS CLARIFIED BY FIRST AMENDMENT THEREOF RECORDED JANUARY 17, 1989, IN BOOK 6200, PAGE 1908, OF OFFICIAL RECORDS.

ALSO EXCEPTING THEREFROM ANY AND ALL WATER RIGHTS OR WATER STOCK APPURTENANT TO

OR USED IN CONNECTION WITH THE LAND AND ALL MINERALS, COAL, CARBONS, HYDROCARBONS,

OIL, GAS, CHEMICAL ELEMENTS AND COMPOUNDS WHETHER IN SOLID, LIQUID OR GASEOUS FORM,

AND ALL STEAM AND OTHER FORMS OF THERMAL ENERGY ON, IN OR UNDER THE ABOVE DESCRIBED LAND, (THE "MINERAL ESTATE"), PROVIDED THAT GRANTOR DOES NOT RESERVE THE RIGHT TO ENTER UPON OR USE THE SURFACE OR ANY PART OF THE SUBJECT LANDS ABOVE A DEPTH OF 500

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Prelim (CA/NV) Page 5 157201-001304
FEET BELOW THE SURFACE, AS RESERVED BY FARMLAND RESERVE, INC., A UTAH CORPORATION IN DEED RECORDED OCTOBER 7, 2004 AS DOCUMENT NO. 04-243888 OF OFFICIAL RECORDS.

APN'S: 536-010-33, 536-010-41, 536-010-71, 536-010-74 AND 536-010-85 TRACT 3:

PARCEL A (WELL 4E 36-1)
COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 36; THENCE SOUTH 89°13'33" EAST ALONG THE SOUTH LINE OF SAID SECTION 36, A DISTANCE OF 14.45 FEET TO THE NORTH QUARTER CORNER OF SECTION 1, TOWNSHIP 29 SOUTH, RANGE 26 EAST, MOUNT DIABLO MERIDIAN; THENCE SOUTH 89°14'03" EAST ALONG THE NORTH LINE OF SAID SECTION 1, A DISTANCE OF 1028.00 FEET; THENCE NORTH 00°45'57" EAST, A DISTANCE OF 251.20 FEET TO THE TRUE POINT OF BEGINNING; THENCE 1) NORTH 44°44'39" WEST, A DISTANCE OF 110.00 FEET; THENCE 2) NORTH 45°15'21" EAST, A DISTANCE OF 70.94 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY LINE OF THE CALLOWAY CANAL;
THENCE 3) SOUTH 44°44'39" EAST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 110.00 FEET; THENCE 4) SOUTH 45°15'21" WEST, A DISTANCE OF 70.94 FEET TO THE TRUE POINT OF BEGINNING.

APN: 536-010-13
PARCEL B (WELL 4E 36-2)
COMMENCING AT THE SOUTHWEST CORNER OF SAID SECTION 36; THENCE NORTH 02°10'43" EAST ALONG THE WEST LINE OF SAID SECTION 36, A DISTANCE OF 2135.15 FEET; THENCE SOUTH 87°49'17" EAST, A DISTANCE OF 840.17 FEET TO THE TRUE POINT OF BEGINNING; THENCE 1) NORTH 17°14'21" EAST, A DISTANCE OF 100.00 FEET; THENCE 2) SOUTH 72°45'39" EAST, A DISTANCE OF 85.51 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY LINE OF THE CALLOWAY CANAL;
THENCE 3) SOUTH 47°31'21" WEST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 8.46 FEET; THENCE 3) SOUTH 17°14'21" WEST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 92.70 FEET; THENCE 4) NORTH 72°45'39" WEST, A DISTANCE OF 81.25 FEET TO THE TRUE POINT OF BEGINNING.

APN: 536-01-12
PARCEL C (WELL 4E 36-3)
COMMENCING AT THE NORTHWEST CORNER OF SAID SECTION 36; THENCE SOUTH 02°11'12" WEST ALONG THE WEST LINE OF SAID SECTION 36, A DISTANCE OF 1532.23 FEET; THENCE SOUTH 87°48'48" EAST, A DISTANCE OF 1838.10 FEET TO THE TRUE POINT OF BEGINNING; THENCE 1) SOUTH 80°52'39" EAST, A DISTANCE OF 61.20 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY LINE OF THE CALLOWAY CANAL;
THENCE 2) SOUTH 09°07'21" WEST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 100.00 FEET; THENCE 3) NORTH 80°52'39" WEST, A DISTANCE OF 61.20 FEET; THENCE 4) NORTH 09°07'21" EAST, A DISTANCE OF 100.00 FEET TO THE TRUE POINT OF BEGINNING.

APN: 536-010-11
PARCEL D (WELL 4E 36-4)
COMMENCING AT THE NORTHWEST CORNER OF SAID SECTION 36; THENCE SOUTH 89°14'39" EAST ALONG THE NORTH LINE OF SAID SECTION 36, A DISTANCE OF 799.97 FEET; THENCE SOUTH 00°45'21" WEST, A DISTANCE OF 79.71 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY LINE OF THE CALLOWAY CANAL AND THE TRUE POINT OF BEGINNING;
THENCE 1) SOUTH 35°48'39" EAST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 100.00 FEET; THENCE 2) SOUTH 54°11°21" WEST, A DISTANCE OF 62.26 FEET;

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Prelim (CA/NV) Page 6 157201-001304
THENCE 3) NORTH 35°48'39" WEST, A DISTANCE OF 100.00 FEET, THENCE 4) NORTH 54°11'21" EAST, A DISTANCE OF 62.26 FEET TO THE TRUE POINT OF BEGINNING.

APN: 536-010-10

PARCEL E
COMMENCING AT THE NORTH QUARTER CORNER OF SAID SECTION 26; THENCE SOUTH 02°10’34"

WEST ALONG THE WEST LINE OF THE NORTHEAST QUARTER OF SAID SECTION, A DISTANCE OF 1700.67 FEET TO A POINT ON THE WESTERLY RIGHT OF WAY LINE OF THE CALLOWAY CANAL; THENCE SOUTH 66°52'59" EAST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 12.14 FEET TO THE TRUE POINT OF BEGINNING;
THENCE 1) SOUTH 66°52'59" EAST ALONG SAID RIGHT OF WAY LINE, A DISTANCE OF 100.00 FEET; THENCE 2) SOUTH 23°07’01” WEST, A DISTANCE OF 34.68 FEET; THENCE 3) NORTH 66°52'59" WEST, A DISTANCE OF 100.00 FEET; THENCE 4) NORTH 23°07'01" EAST, A DISTANCE OF 34.68 FEET TO THE TRUE POINT OF BEGINNING.

APN: 536-010-09

PARCEL F
ALL THAT PORTION OF THE SOUTHEAST ONE-QUARTER OF SECTION 34, TOWNSHIP 28 SOUTH, RANGE 26 EAST, M.D.M., COUNTY OF KERN, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:

COMMENCING AT THE NORTHEAST CORNER OF SAID SECTION 34 FROM WHICH THE NORTHWEST CORNER OF SAID SECTION BEARS NORTH 89°12'12" WEST; THENCE SOUTH 45°44'16" WEST A DISTANCE OF 3730.76 FEET TO THE TRUE POINT OF BEGINNING; THENCE (1) SOUTH 02°12'57" WEST, A DISTANCE OF 40.00 FEET; THENCE (2) NORTH 87°47'03" WEST, A DISTANCE OF 40.00 FEET; THENCE (3) NORTH 02°12'57" EAST, A DISTANCE OF 40.00 FEET; THENCE (4) SOUTH 87°47'03" EAST, A DISTANCE OF 40.00 FEET TO THE POINT OF BEGINNING.

APN: 536-010-80

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EXHIBIT B
TO DEVELOPMENT AGREEMENT NO. 25-22
Map of Property and Ownership Information

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Millrose Properties California, LLC
5 River Park Place East, Suite 210
Fresno, CA 93720
North Kern Water Storage District
33380 Cawelo Extended
Bakersfield, CA 93308
7th Standard Ranch Investors
P.O. Box 82515
Bakersfield, CA 93380
Suburban Land Reserve, Inc.

P.O. Box 511196
Salt Lake City, UT 84151

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EXHIBIT C
TO DEVELOPMENT AGREEMENT NO. 25-22
Current Mission Lakes Specific Plan
Available at:

City of Shafter
336 Pacific Avenue
Shafter, CA 93263
OR
Online at:
www.shafterca.gov/DocumentCenter/View/6045/
Mission-Lakes-SP

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EXHIBIT D
TO DEVELOPMENT AGREEMENT NO. 25-22
Form of Assignment and Assumption Agreement

ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT
This Assignment and Assumption of Development Agreement (“Assignment”) is made this ____ day of __________, by __________, a __________ (“Assignor”) and ____________ (“Assignee”) with reference to the following facts:

A. Assignor is the owner of that certain real property, described in Exhibit “A”, attached hereto and incorporated herein (the “Property”). The Property is subject to the provisions of that certain Development Agreement No. 25-22 ("Development Agreement"), dated as of __________, with the City of Shafter, a California municipal corporation (“City”).

The Development Agreement was recorded on __________, as instrument no.__________, in the official records of the Kern County Recorder.

B. Assignor has proposed to sell and transfer the Property to Assignee. Pursuant to Section 5.4.1 of the Development Agreement, Assignor wishes to assign all rights, duties, and obligations pertaining to the Property under the Development Agreement to Assignee. Similarly, Assignee desires to assume all of Assignor’s rights, duties, and obligations pertaining to the Property under the Development Agreement.

C. Assignor’s proposed sale and transfer of the Property to Assignee has been reviewed and approved by the City pursuant to Section 5.4.1 of the Development Agreement, as evidenced by the City’s execution of this Assignment below.

NOW, THEREFORE, in consideration of the mutual covenants of the parties herein, and for good and valuable consideration, the receipt of sufficiency of which is hereby acknowledged, the parties agree as follows:

1. Incorporation of Recitals. The Recitals of fact set forth above are true and correct and are incorporated into this Agreement in their entirety by this reference.

2. Assignment and Assumption. Assignor hereby transfers and assigns to Assignee, and Assignee hereby expressly and unconditionally assumes all the rights, duties and obligations of Assignor under the Development Agreement to the extent those rights pertain to the Property, including, without limitation, all of the general rights, duties and obligations of Assignor under the Development Agreement for the development of the Property. Assignee agrees to observe and fully perform all of Assignor's obligations under the Development Agreement, and to be subject to all the terms and conditions thereof, it being the express intention of both Assignor and Assignee that, upon execution of this Assignment, Assignee shall become substituted for Assignor as the “Owner” under the Development Agreement with respect to the Property.

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3. Secured Obligations. Pursuant to section 5.4.1(b) of the Development Agreement, Assignee has provided the City with security equivalent to any security previously provided by Assignor to secure performance of its obligations under the Development Agreement.

4. Release of Assignor. Pursuant to section 5.4.1(c) of the Development Agreement, Assignor shall be free from any and all liabilities pertaining to the Property accruing on or after the date hereof with respect to the Development Agreement. No breach or default under this Assignment or the Development Agreement by Assignee shall be attributed to Assignor.

5. Governing Law. This Assignment is made and entered into in the State of California and shall be interpreted, construed and enforced in accordance with the laws of the State of California. Venue shall be in Kern County.

6. Binding Effect. This Assignment shall apply to, bind, and inure to benefit of Assignor and Assignee, and their respective heirs, legal representatives, successors and assigns.

7. Counterparts. This Assignment may be executed in one or more counterparts, each of which shall be an original, but all of which shall together constitute one instrument. [Signatures on Following Pages]

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IN WITNESS WHEREOF, this Assignment has been executed as of the date first above written.
“ASSIGNOR”
________________
a ________________
By: ______________________________
Name: __________________
Its: _________________________________
“ASSIGNEE”
________________
a ________________
By:__________________________________
Name: _______________________________
Its: __________________________________
[Intentionally Left Blank]

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The City of Shafter hereby approves of this Assignment and acknowledges that Assignor, having satisfied the conditions to the release set forth in Section 5.4.1 of the Development Agreement, shall be released from its obligations under the Development Agreement with respect to the Property described in Exhibit A.

CITY OF SHAFTER, a California municipal law corporation By: ______________________________
Name:

Its:

ATTEST:

By: _______________________________
City Clerk

APPROVED AS TO LEGAL FORM

BEST BEST & KRIEGER LLP
By: _________________________
City Attorney

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STATE OF CALIFORNIA )
COUNTY OF _____________ )ss.
)
On __________________, before me, _______________, a 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 signatures(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 forgoing paragraph is true and correct.

WITNESS my hand and official seal.
____________________________________
Notary Public

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

WITNESS my hand and official seal.
____________________________________
Notary Public

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EXHIBIT A TO EXHIBIT “D”

LEGAL DESCRIPTION OF PROPERTY BEING ASSIGNED

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EXHIBIT E
TO DEVELOPMENT AGREEMENT NO. 25-22
Public Improvement Phasing Plan

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Phase 1 Tract 7461
Roads: North half improvements of Seventh Standard Road from the west side of Calloway Canal to the west boundary line of Phase 1, Full width improvements1 (not including sidewalk and landscaping on east side) of Lake Road, including sidewalk and landscaping along the west side of Lake Road for the tract frontage, Full width improvements (not including sidewalk and landscaping on north side) of Mission Lakes Boulevard South from Lake Road to the south end of Street A, including sidewalk and landscaping along the south side of Mission Lakes Boulevard, and fire access improvements consisting of base rock and two-lane asphalt pavement on Mission Lakes Boulevard South from the south end of Street A to Zerker Road.

Sewer: Sewer main from the point of connection on Seventh Standard Road at Zerker Road to Mission Lakes Boulevard South, east along Mission Lakes Boulevard South to Lake Road, south to point of connection on Seventh Standard Road.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company connection in Seventh Standard Road across Calloway Canal along Seventh Standard Road to Zerker Road. A tee main connection will be installed at Lake Road to continue to Mission Lakes Boulevard South, then continuing along Mission Lakes Boulevard South to Zerker Road, then south on Zerker Road to Seventh Standard Road.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 1.

Signal: Traffic Signal at intersection of Seventh Standard Road and Lake Road.

Phase 2 Tract 7462
Roads: Sidewalks and landscape for east side of Lake Road, Full width improvements (not including sidewalk and landscaping on west side) of Mission Lakes Boulevard East from Lake Road to Street D, including landscape and sidewalk along east side of Mission Lakes Blvd from Lake Road to D Street and Full width improvements (not including sidewalk and landscaping on west side) of Street D to the Phase 2 north boundary, including landscape and sidewalk on east side of D street from Mission Lakes Blvd to northerly boundary of Phase 2. 1 Full width improvement means curb-to-curb.

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Sewer: Sewer main along Mission Lakes Boulevard East from Lake Road to Street D, along Street D to the Phase 2 north boundary.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company, along Mission Lakes Boulevard East from Lake Road to Street D, then along Street D to Mission Lakes boundary connecting to Gossamer Grove development.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 2.

Phase 3 Tract 7463
Roads: Full width improvements (not including sidewalk and landscaping on north side) of Mission Lakes Boulevard North along Phase 3 frontage, including landscape and sidewalk on south side of Mission Lakes Blvd North for Phase 3 frontage and Full width improvements (not including sidewalk and landscaping on west side) of Street A, including landscape and sidewalk along east side of A Street from Mission Lakes Blvd South to Mission Lakes Blvd North; sidewalk and landscaping on the north side of Mission Lakes Boulevard South from Street A to the eastern boundary of Phase 3.

Sewer: Sewer main along Street A from Mission Lakes Boulevard South to Mission Lakes Boulevard North, and along Mission Lakes Boulevard North from Street D to Lennar’s western property line/Suburban Land’s eastern property line.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company, along Street A from Mission Lakes Boulevard South to Mission Lakes Boulevard North, and along Mission Lakes Boulevard North from Street D to Lennar’s western property line/Suburban Land’s eastern property line.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 3.

Signals: Traffic Signals at intersections of Mission Lakes Boulevard South and Zerker Road, and Mission Lakes Boulevard North and Zerker Road (if warranted by a traffic impact study).

Phase 4 Tract 7464
Roads: Sidewalks and landscape for north side of Mission Lakes Boulevard North along Phase 4, full width improvements along Mission Lakes Blvd North from westerly boundary of Phase 4 to A Street and Full width improvements (not including sidewalk and landscaping on east side) of Street D from Phase 2 boundary to the north boundary of Phase 4, including landscape and sidewalk

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improvements along west side of D Street from Mission Lakes Blvd to northerly boundary of Phase 4.

Sewer: Sewer main along Street D from Phase 2 boundary to the north boundary of Phase 4.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company installed with Phases 1-3.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 4.

Signals: Traffic Signals at intersections of Mission Lakes Boulevard South and Zerker Road, and Mission Lakes Boulevard North and Zerker Road (if warranted by a traffic impact study).

Phase 5
Roads: North half improvements of Seventh Standard Road from the west boundary line of Phase 5 to the west boundary of Phase 1, and Full width improvements (including sidewalks and landscape for south side) of Mission Lakes Boulevard South from Street A to the west boundary line of Phase 5, and Full width improvements along Zerker Road from Mission Lakes Boulevard South to Seventh Standard Road, including landscape and sidewalk on both side of Zerker Road from 7th Std Road to Mission Lakes Blvd South.

Sewer: Sewer main along Mission Lakes Boulevard South from Zerker Road to the west boundary of Phase 5.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company connection in Seventh Standard Road from Zerker Road to the west boundary of Phase 5, and along Mission Lakes Boulevard South from Zerker Road to the west boundary of Phase 5.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 5.

Signals: Modifications to existing traffic signal and loop detectors at the intersection of Zerker Road and 7th Std Road.

Traffic Signals at intersections of Mission Lakes Boulevard South and Zerker Road, and Mission Lakes Boulevard North and Zerker Road (if warranted by a traffic impact study).

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Phase 6
Roads: Full width improvements including landscape and sidewalk on both sides of Mission Lakes Boulevard North from Zerker Road to west boundary of Phase 4, and Full width improvements including landscape and sidewalk on both sides of Zerker Road from Mission Lakes Boulevard South to north boundary of Phase 6; sidewalk and landscaping on the west side of A Street between Mission Lakes Boulevard South and Mission Lakes Boulevard North.

Sewer: Sewer main along Mission Lakes Boulevard North from Zerker Road to the west boundary of Phase 4, and along Zerker Road from Mission Lakes Boulevard South to north boundary of Phase 6.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company Mission Lakes Boulevard North from Zerker Road to the west boundary of Phase 4, and along Zerker Road from Mission Lakes Boulevard South to north boundary of Phase 6.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 6.

Signals: Traffic Signals at intersections of Mission Lakes Boulevard South and Zerker Road, and Mission Lakes Boulevard North and Zerker Road (if warranted by a traffic impact study).

Phase 7
Roads: Full width improvements of Street D from north Phase 4 boundary to northeast side of the Calloway Canal including roadway bridge over Calloway Canal and sidewalk and landscaping on both sides of D Street along Phase 7 frontage; sidewalk and landscaping on the west side of Mission Lakes Boulevard from the Phase 3 boundary to Street D. -
Sewer: Sewer main along Street D from north Phase 4 boundary to Street E.

Water: Domestic and Irrigation mains from Oildale Mutual Water Company installed with Phases 1-3.

Utilities: Power, Gas, Telephone, Fiber and Cable TV to serve Phase 7.

Signals: Traffic Signals at intersections of Mission Lakes Boulevard South and Zerker Road, and Mission Lakes Boulevard North and Zerker Road (if warranted by a traffic impact study).

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