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NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which are <br />hereby acknowledged, the parties hereto agree as follows: <br />I. Owner's Performance and Obligations. <br />A. Owner hereby grants to City, in accordance with the terms and conditions of this <br />Lien Agreement, a lien upon the property ( "Property ") described in Exhibit "A" attached <br />hereto, as security for construction of the improvements ( "Improvements ") specified in Exhibit <br />"B ", in the estimated amounts to complete such Improvements. This lien secures said obligation <br />and the remedies provided herein for breach of said obligation. <br />B. For so long as title to the Property remains subject to this Lien Agreement, Owner <br />shall not: (1) request issuance by the Department of Real Estate of the Final Subdivision Public <br />Report for the Property; or (2) sell or permit the sale of any lot shown on the Map to any entity <br />other than one with which the Owner is in common control or in which the Owner retains <br />primary operational and managerial control and retains at least 51% interest at all times. <br />C. As a condition of obtaining a building permit from the City for any construction <br />on the Property, Owner shall substitute other forms of security reasonably satisfactory to City in <br />place of this Lien Agreement, including, without limitation, letters of credit (as applicable, the <br />"Replacement Security ") along with an executed replacement Subdivision Improvement <br />Agreement between Owner and the City. The City agrees that, within the first two years from <br />recordation of this Lien Agreement, substitution by Owner of bonds, letters of credit and /or cash <br />in the aggregate amount of Five Million Dollars ($5,000,000), or such lesser amount based on a <br />calculation of 160% of the cost estimate approved by the City based on the final construction <br />documents and plans prepared and submitted by the Owner for said Improvements, is <br />satisfactory to and approved by the City as Replacement Security. If the substitution occurs <br />more than two years from the recordation date of this Lien Agreement, the amount of the <br />Replacement Security shall be 160% of the cost estimate approved by the City based on the final <br />construction documents and plans prepared and submitted by the Owner for said Improvements. <br />Any required City approvals shall not be unreasonably withheld. <br />D. Even if Owner has not applied for or been issued a building permit for <br />construction on the Property, Owner shall provide the Replacement Security within two (2) years <br />following the date of recordation of the Map. The City may grant extensions of time in its sole <br />discretion. <br />II. City's Performance and Obligations. <br />A. Following the City's receipt of the Replacement Security, the Property shall be <br />automatically released from this Lien Agreement. Promptly upon Owner's request, the City <br />shall execute any necessary release or other document to enable Owner or its transferee to clear <br />the Property's record of title of this Lien Agreement and any lien herein imposed. <br />B. In no instances shall this Lien Agreement compel the City to construct the <br />required Improvements. <br />I I I1334.0 UUC <br />3779��- OnOb- /0- 0- tU /wcdlwrA -Z- <br />