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HomeMy WebLinkAboutSDP 12-06; Cottage Row Apartments; Site Development Plan (SDP) (2)^ CITY OF CARLSBAD LAND USE REVIEW APPLICATION P-1 Development Services Planning Division 1635 Faraday Avenue (760) 602-4610 www.carlsbadca.gov APPLICATIONS APPLIED FOR: (CHECK BOXES) Development Pennits (FOR DEPT. USE ONLY) Leqislative Permits (FOR DEPT. USE ONLY) n Administrative Permit n General Pian Amendment n Coastal Development Permit (*) Q Minor r~l Local Coastal Program Amendment (*) n Conditional Use Permit (*) n Minor Q Extension r~l Master Plan f"! Amendment n Environmental Impact Assessment n Specific Pian fl Amendment O Habitat RAanagement Permit Q Minor O Zone Change (*) Q Hillside Development Pennit (*) n Zone Code Amendment r~l Planned Development Permit PUD n Residential CH Non-Residential r~l Planned Industrial Permit List otfier aoolicaGons not specified n Planning Commission Determination • M Site Development Plan • n Special Use Pemnit • r~] Tentative Tract Map (*) = eligible for 25% discount r~l Variance fl Administrative NOTE: A PROPOSED PROJECT REQUIRING MULTIPLE APPUCATIONS MUST BE SUBMITTED PRIOR TO 3:30 P.M. A PROPOSED PROJECT REQUIRING ONLY ONE APPUCATION MUST BE SUBMrTTEO PRIOR TO 4:00 P.M. ASSESSOR PARCEL NO(S).: 212-040-47-00 PROJECT NAME: Cottage Row Apartments BRIEF DESCRIPTION OF PROJECT: 24 Residential units on a 12.1 Acre Site {existing) BRIEF LEGAL DESCRIPTION: Lot 134 of Carlsbad Tract 97-14 Unit 1 in City of Carlsbaci, County of San Diego, California. LOCATION OF PROJECT: ON THE: West 1400 Flame Tree Lane, Carlsbad, CA 92011 STREET ADDRESS SIDE OF Aviara Parkway (NORTH, SOUTH, EAST, WEST) BETWEEN Laurel Tree Lane (NAME OF STREET) AND Flame Tree Lane (NAME OF STREET) (NAME OF STREET) P-1 Page 1 of 5 Revised 07/10 OWNER NAME (Print): Cottage Row Carlsbad, LLC APPLICANT NAME (Prin^ Cottage Row Carlsbad, LLC MAILING ADDRESS: P.O. Box 2194 MAILING ADDRESS: P.O. BoX 2194 CITY, STATE. ZIP: Newpoft Beach, CA 92659 CITY, STATE. ZIP: Newpoft Beach, CA 92659 TELEPHONE: 949 351-4890 TELEPHONE: 949 351-4890 EMAIL ADDRESS: henthorn@jhenthom.eom EMAIL ADDRESS: henthom@jhenthorn.eom 1 CERTIFY THAT 1 AM THE LEGAL OWNER AND THAT ALL THE ABOVE INFORMATION IS TRUE AND CORRECT TO THE BEST OF MY KNOWLEDGE. ^ 1 CERTIFY THAT 1 AM THE LEGAL REPRESENTATIVE OF THE OWNER AND THAT ALL THE ABOVE INFORMATION IS TRUE AND CORRECT TO THE BEST OF MY KNOWLEDGE. SIGNATURE DATE SIGNATURE DATE APPLICANTS REPRESENTATIVE (Print): Jack Henthom MAILING ADDRESS: P.O. BoX 237 CITY, STATE, ZIP: Carlsbad, CA 92018 TELEPHONE: 760 438 4090 EMAIL ADDRESS: henthorn(gjhenthorn.com 1 CERTIFY THAT 1 AM THE LEGAL REPRESENTATIVE OF THE APPLICANT AND THAT ALL THE ABOVE INFORMATION IS TRUE AND CORRECT TO THE BEST OF MY KNOWLEDGE. SIGNATURE DATE IN THE PROCESS OF REVIEWING THIS APPLICATION IT MAY BE NECESSARY FOR MEMBERS OF CITY STAFF, PLANNING COMMISSIONERS OR CITY COUNCIL MEMBERS TO INSPECT AND ENTER THE PROPERTY THAT IS THE SUBJECT OF THIS APPLICATION. 1/WE CONSENT TO ENTRY FOR THIS PURPOSE. NOTICE OF RESTRICTION: PROPERTY OWNER ACKNOWLEDGES AND CONSENTS TO A NOTICE OF RESTRICTION BEING RECORDED ON THE TITLE TO HIS PROPERTY IF CONDITIONED FOR THE APPLICANT. NOTICE OF RESTRICTIONS RUN WITH THE LAND AND BIND ANY SUCCESSORS IN INTEREST. PROPERTY OWNER SIGNATURE FOR CITY USE ONLY RECEIVED DEC 2 1 2012 CITY OF CARLSBAD PLANNING DIVISION DATE STAMP APPLICATION RECEIVED RECEIVED BY: P-1 Page 2 of 5 Revised 07/10 City of Carlsbad Faraday Center Faraday Cashiering 001 1301601-1 01/16/2013 32 Wed, Jan 16, 2013 02:46 PM Receipt Ref Nbr: R1301601-1/0024 PERMITS - PERMITS Tran Ref Nbr: 130160101 0024 0027 Trans/Rcpt#: R0093169 SET #: PUD13001 Amount: 1 @ $2,908.00 Item Subtotal: $2,908.00 Item Total: $2,908.00 1 ITEM(S) TOTAL: $2,908.00 Check (Chk# 02186) $2,908.00 Total Received: $2,908.00 Have a nice day! **************CUSTOMER COPY************* city of Carlsbad 163 5 Faraday Avenue Carlsbad CA 92008 Applicant: COTTAGE ROW CARLSBAD LLC Description PUD13 001 14 00 FLAME TREE LN CBAD Amount 2,908.00 Receipt Number: R0093169 Transaction Date: 01/16/2013 Transaction ID: R0093169 Pay Type Method Description Amount Payment Check 2,908.00 Transaction Amount: 2,908.00 City of Carlsbad Faraday Center Faraday Cashiering 001 1301601-1 01/16/2013 32 Wed, Jan 16, 2013 02:46 PM Receipt Ref Nbr: R1301601-1/0024 PERMITS - PERMITS Tran Ref Nbr: 130160101 0024 0027 Trans/Rcpt#: R0093169 SET #: PUD 13001 Amount: 1 @ $2,908.00 Item Subtotal: $2,908.00 Item Total: $2,908.00 1 ITEM(S) TOTAL: $2,908.00 Check (Chk# 02186) $2,908.00 Total Received: $2,908.00 Have a nice day! **************[;(JST0MER COPY************* City of Carlsbad 1635 Faraday Avenue Carlsbad CA 92008 Applicant: COTTAGE ROW CARLSBAD LLC Description PUD13001 1400 FLAME TREE LN CBAD Amount 2,908.00 Receipt Number: ROO93169 Transaction Date: 01/16/2013 Transaction ID: R0093169 Pay Type Method Description Amount Payment Check 2,908.00 Transaction Amount: 2,908.00 City of Carlsbad Faraday Center Faraday Cashiering 001 1235601-2 12/21/2012 32 Fri, Dec 21, 2012 01:47 PM Receipt Ref Nbr: R1235601-2/0007 PERMITS - PERMITS Tran Ref Nbr: 123560102 0007 0008 Trans/Rcpt#; R0092852 SET #: SDP12005 Amount: 1 g $11,390.95 Item Subtotal: $11,390.95 Item Total: $11,390.95 1 ITEM(S) TOTAL: $11,390.95 Check (Chk# 02169) $11,390,95 Total Received: $11,390.95 Have a nice day! *********4:****(;UST0MER COPY************* City of Carlsbad 1635 Faraday Avenue Carlsbad CA 92008 Applicant: COTTAGE ROW CARLSBAD LLC Description SDP12006 14 00 FLAME TREE LN CBAD Amount 11,390.95 Receipt Number: R0092852 Transaction Date: 12/21/2012 Transaction ID: R0092852 Pay Type Method Payment Check Description Amount 11,390.95 Transaction Amount: 11,390.95 December ll. 2012 Cottage Row Development LLc P.O. Box 2194 Newport Beach, CA 92659 Subject: Authorlietlon to execute documents jt^HT^rr' P*'^'^«^°'*=«»^8««<'«'t>«^«'''PmentLLC, I hereby authorise ;eck Henthorn, of Jack Henthorn & Associates to execute documents required fbr the processing end Issuance of form^ end permrts associated the SDP application and any conditions associated with Its approval 'RusselRadach ly^anaglng General Partoer WRITTEN CONSENT IN LIEU OF A MEETING OF THE MEMBERS OF COTTAGE ROW CARLSBAD LLC, A CALIFORNIA LIMITED LIABILITY COMPANY The undersigned, constituting a "Majority ofthe Members" of COTTAGE ROW CARLSBAD LLC, a Cahfomia limited habiiity company (the "Company"as such term is defmed in the Company's May 10,2007, operating agreement, as amended by that certain First Amendment to Operating Agreement, dated for reference purposes as of November 25, 2009 (collectively, the "Operating Agreement"), acting in accordance with Article 7.9 of the Company's Operating Agreement, take the following action(s) by written consent: 1400 FLAME TREE LANE. CARLSBAD. CALIFORNIA PROPERTY: WHEREAS, the Company owns certain real property located in the City of Carlsbad, County of San Diego, State of Califomia, commonly known as 1400 Flame Tree Lane, Carlsbad, Califomia (the "Property"). WHEREAS, the Company and the City ofCarlsbad, Califomia (the "City") have entered, or will shortly enter, discussions regarding a possible modification to, or replacement of, the current Conditional Use Permit, plus other matters, relating to the Property (collectively, "Property Matters"). WHEREAS, the City has requested the Company to certify to the City certain information relating to the Company and the Property. NOW, THEREFORE, BE IT RESOLVED, that a Majority ofthe Members hereby approve and authorize the Company to certify the following information to the City: (1) Russel R. Radach is the duly appointed and acting President (CEO) and Assistant Secretary of the Company; (2) the Company is managed by all of the Members; (3) the two Members executing this Unanimous Written Consent collectively own the rights to 100% of the profits and losses of the Company and constitute all of the Members of the Company; (4) Russel R. Radach, acting alone, as the Company's President (CEO) and Assistant Secretary, is authorized to bind and obligate the Company in any amount and nature (including without limitation, executing and delivering documents and instruments on behalf of the Company) with respect to any or all Property Matters; and (5) the Secretary or the Assistant Secretary is authorized to certify from time to time that these resolutions remain in full force and effect. [This space intentionally left blank.| IN WITNESS WHEREOF, the undersigned has/have executed this Written Consent as of November 5, 2012. "Members" THE RADACH FAMILY TRUST U/D/T JULY 7, 2001 (75% Percentage Interest) Sonja Radach-SiegenthaTer, (Coi-Tmstee THE RODZraCK H. HARRON TRUST U/D/T MAYi6, 2009 (2S%/Percentage Interest) By: yzti, Z{)W (25»"iWFercenti Roderick H. Harron, Trustee C:\01 Ybarralaw Projects\CL--R\C-D\Cottage Row Carlsbad LLC\Org Docs\UWC Members 121 lOS.wpd ^ PROJECT Development Services DESCRIPTION Planning Division ^ CITY OF P i/R\ 1635 Faraday Avenue TAR I ^RAD "^"'W (760)602^10 /~V I \ l_ J ur\ www.carlsbadca.gov PROJECT NAME- Cottage Row Apartments APPLICANT NAME: Cottage Row Carlsbad, LLC Please describe fully the proposed project by application type. Include any details necessary to adequately explaun the scope and/or operaton of the proposed projecL You may also include any badcground infonnation and supporting statements regarding the reasons fbr, or appropriateness of, the application. Use an addendum sheet if necessary. Description/Explanation: The proposed site development plan will replace the existing conditional use permit. The conditional use pennit requires tiie project to be operated as a religiously affiliated retirement facility, and not allow for transfer. The CUP was modified in 2007 to allow a transfer of ownership subject to the terms of the CUP. The new owners have been unsuccessful in attracting a faith-based retirement operation. The owners are requesting that the CUP be replaced by the SDP, as provided in the City regulations to allow the owners to continue to operate 24 rental units on the site. P-1^) Page 1 of 1 Revised 07/10 ^•' CITY OF CARLSBAD HAZARDOUS WASTE AND SUBSTANCES STATEMENT P-1(C) Development Services IHanning Division 1635 Faraday Avenue (760) 602-4610 www.cai1sbadca.gov Consultation of Lists of Sites Related to Hazardous VWastes (Certification of Compliance with Govemment Code Section 65962.5) Pursuant to State of Califomia Govemment Code Section 65962.5, i have consulted the Hazardous V\^ste and Sub^nces Sites List compiled by tiie Califomia Environmental Protection Agency and her^y certify that (check one): ^ The development project and any altematives proposed in this application are not contained on the lists compiled pursuant to Section 65962.5 of the State Govemment Code. r~l The development project and any altematives proposed in this application are conteined on the lists compiled pursuant to Section 65962.5 ofthe Stete Govemment Code. APPLICANT Name- Cottage Row Carlsbad, LLC Address: P.O. 6ox 2194 Newport Bch. CA 92659 Phone Number: 949 351-4890 Name: PROPERTY OWNER Cottage Row Carlsbad, LLC Address: P Q- Box 2194 Newport Bch, CA 92659 Phone Number 949 351-4890 Address of Site: 1400 Flame Tree Lane Local Agency (City and County):_ Citv of Carlsbad. County of San Diego Assessor's book, page, and parcel numt)er 212-040-47-00 „ ^ .. , , N/A Specrfy list(s): Regulatory Identification Numt)er_ Date of List mA N/A Property Owner Signature/Date The Hazardous Waste and Substances Sites List (Cortese List) is used by the State, local agencies and developers to comply with the Califomia Environmental Quality Act requirements in providing informatton about the location of hazardous materials release sites. P-1(C) Page 1 of 2 Revised 07/10 ^ TIME UMITS ON Development Services d DISCRETIONARY Planning Dhrision •-''' "^'^^ oDPn IPr^TQ 1635 Faraday Avenue CARLSBAD PifE^^ "Tr"*'" »• ^^-w^* f-l^C/ www.carlsbadca.gov PLEASE NOTE: Time limits on the processing of disaetionary projects established by state law do not start until a project application is deemed complete by tiie City. The City has 30 calendar days from tiie date of application sutmiittal to determine whether an application is comple or irKX)mplete. Within 30 days of submittal of this application you will receive a letter stating whetiier this application is complete or incomplete. If it is incomplete, the letter will state what is needed to make this application complete. When the application is complete, the processing period will start upon the date of the completion letter. If you have any questions regarding application submittal requirements (Le., clarification regarding a specific requirement or whettier all requirements are necessary for your particular application) please call (760) 602-4610. Applicant Signature: "^V^^^^''---^"'^^^ //—/S^~ ('Z^ Staff Signature: CIAX^ WJCA^_^ Date: /S'^l - /^ To be stapled w'ltii receipt to the application p-1 (E) Page 1 of 1 Revised 07/10 ^ DISCLOSURE Development Services vt STATEMENT ~~ Piannir^ Dhrision ^ CITY OF P AtA\ 1635 Faraday Avenue CARLSBAD * ' ^* *^ www.carlsbadca.gov Applicant's staten^ or disclosure of certain ownership inter^ts on ail applk^tions whkdi will require discretionary action on the part ofthe City Council or any appointed Board, Commission or Committee. The folk)wing infomiation MUST be disck)sed at the time of application submittal. Your project cannot be reviewed until this information is completed. Please print Note: Person is defined as "Any individual, firm, co-partnership, Joint venture, association, social club, fratemai organization, corporation, estate, trust, receiver, syndicate, in this and any other county, dty and county, city municipality, district or other political subdivision or any other group or combination acting as a unit." Agents may sign this document; however, the legal name and entity of the applicant and property owner must be provided below. 1. APPUCANT (Not tiie applicant's agent) Provide the COiyiPLETE. LEGAL names and addresses of ALL persons having a financial interest In tiie application, tf ttw applicant indude a corooi^on or oartnership. Include the names, tities, addresses of all indh/iduals owning more tiian 10% of the shares. IF NO INDIVIDUALS OWN MORE THAN 10% OF THE SHARES. PLEASE INDICATE NON-APPLICABLE (N/A) IN THE SPACE BELOW. If a Pubiidv-owned corporation. Indude the names, tities, and address^ of the corporate officers. (A separate page may be attached If necessary.) Person Russel Radach Coro/Part Cottage Row Carlsbad, LLC Title Managing Partner Trtle Address Address PO Box 2194 Newport Bch, CA 92659 OWNER (Not tiie owner's agent) Provide tiie COMPLETE. LEGAL names and addresses of ALL persons having any ownership Interest In tiie property Invoh^ed. Also, provide the nature of the legai ownership (i.e., parbiership, tenants in common, non-profit, corporation, etc.). If the ownership indixJes a corporation or partnership, indude the names, tities, addresses of ali indlvkiuais owning more tiian 10% of ttie shares. IF NO INDIVIDUALS OWN MORE THAN 10% OF THE SHARES, PLEASE INDICATE NON-APPLICABLE (N/A) IN THE SPACE BELOW. If a pubiidy-owned corooration. indude the names, titles, and addresses of the corporate officers. (A separate page may be attached if necessary.) Person Russel Radach Coro/Part Cottage Row Carlsbad, LLC Title Managing Partner jitle Address Address PO Box 2194 Newport Bch, C A 92659 p-1 (A) Page 1 of 2 Revised 07/10 NON-PROFIT ORGANIZATION OR TRUST If any person Identified pursuant to (1) or (2) above is a nonprofit organization or a tmst. list the names and addresses of ANY person serving as an officer or director of the non- profit organization or as tiustee or benefidary of tiie. Non Profit/Trust NOT Profit/Trust Title Title Address Address 4. Have you had more than $500 worth of business transacted with any member of City staff. Boards, Commissions, Committees and/or Coundl within the past twelve (12) months? I I Yes ^ No If yes, please Indicate person(s):. NOTE: Attach additional sheets if necessary. I certify that all ttie above information is tixie and correct to the best of my knowledge. Slgnature of owner/date Signature of applicant/date Russel Radach Russel Radach Print or type name of owner Print or type name of applicant Signature of owner/applicanf s agent If applicable/date Print or type name of owner/applicant's agent P-1 (A) Page 2 of 2 Revised 07/10 State Of CaJjfornia Secretary of State I, DEBRA BOWEN, Secretary of State of the State of California, hereby certify: That the attached transcript of. page(s) has been compared with the record on file in this office, of which it purports to be a copy, and that it is full, true and correct. IN WITNESS WHEREOF, I execute this certificate and affix the Great Seal of the State of California this day of MAY 1 52007 DEBRA BOWEN Secretaiy of State Sec/state Form CE-107 (REV 1/2007) ospoe wm LLCI State of California Secretary of State LIMITED LIABILITY COMPANY ARTICLES OF ORGANIZATION A $70.00 filing fee must accompany this form. IMPORTANT - Read instructions before completing this form. Flle# 200713110146 , ENDORSED - iFtLED In fhe office ofthe Secretary of State ofthe State of Califomia MAY 0 8 2007 This Space For Ffling Use Only ENTITY NAME (End the name with the words "Limited Liabiiity Company," or the abbreviaUons "LLC" or "L.L.C." The words "Limited" and "Company" may be at)breviated lo "Ltd." and "Co.," respectively.) 1. NAME OF LIIWITED LlABlLiTY COMPANY COTTAGE ROW CARLSBAD LLC PURPOSE (The foJiowIng statement is required by statute and shouid not be altered.) 2. THE PURPOSE OF THE LIMITED LIABILITY COMPANY IS TO ENGAGE IN ANY LAWFUL ACT OR ACTIVITY FOR WHICH A LIMITED LIABILITY COMPANY MAY BE ORGANIZED UNDER THE BEVERLY-KILLEA LIMITED LIABILrTY COMPANY ACT. INITIAL AGENT FOR SERVICE OF PROCESS (If the agent is an Individual, the agent must reside in California and both Items 3 and 4 must be completed. If the agent is a corporation, the agent must have on file with the Califomia Secretary of State a certificate pursuant to Corporations Code section 1505 and Item 3 must be completed (leave Item 4 blank). 3. NAME OF INITIAL AGENT FOR SERVICE OF PROCESS WAYNE A. YBARRA, ESQ. 4. IFAN INDIVIDUAL, ADDRESS OF INITIAL AGENT FOR SERVICE OF PROCESS IN CALIFORNIA CITY 479 OCEAN AVENUE, LAGUNA BEACH, STATE ZIP CODE CA 92651 MANAGEMENT (Check only one) 5, THE LIMrTED UABILITY COMPANY WILL BE MANAGED BY; ONE MANAGER MORE THAN ONE MANAGER [•] ALL LIMITED LIABILITY COMPANY MEMBER(S) ADDITIONAL INFORMATION e, ADDITIONAL INFORMATION SET FORTH ON THE ATTACHED PAGES, IF ANY. IS INCORPORATED HEREIN BY THIS REFERENCE AND MADE A PART OFTHIS CERTIFICATE. OPERATING AGREEMENT FOR COTTAGE ROW CARLSBAD LLC THIS OPERATING AGREEMENT (this "Agreement") is entered into as of MAY 10,2007, by and between: RUSSEL R. RADACH and SONJA RADACH-SIEGENTHALER, CO-TRUSTEES ofThe Radach Family Trust U/D/T My 7,2001 ("Radach"); and RODERICK H. HARRON and JUDITH A. GORSKI, CO-TRUSTEES of The Harron/Gorski Family Trust U/D/T May 21,2000 ("Harron/Gorski"). Radach and Harron/Gorski are sometimes collectively referred to as the Members and individually as a Member. RECITALS A. The Members desire to form a limited liability company (the "Company") under the Beverly-Killea Limited Liability Company Act. B. The purpose of the Company shall be as set forth in Article U, Section 2.5. C. The Members enter into this Agreement to form and provide for the governance of the Company and the conduct of its business, and to specify their relative rights and obligations. AGREEMENT NOW THEREFORE, the Members agree as follows: ARTICLE I: DEFINITIONS Capitalized terms used in this Ag-eement have the meanings specified in this Article or elsewhere in this Agreement and when not so defined shall have the meanings set forth in Califomia Corporations Code §17001. 1.1 "Act" means the Beverly-Killea Limited Liability Company Act (Califomia Corporations Code §§17000-17705), including amendments thereto made from time to time. 1.2 "Adjusted Capital Contribution" is defmed in Article IV, Section 4.6(a). 1.3 "Adjusted Capital Account Deficit" is defmed in Article IV, Section 4.3(a). \\TdelI\c\Cli«nU - A\R>ilach\CatUg« Row Cariibid LLC\Cotugs Row Carlibid Op Agl 70510.w|>d -1- 1.4 "Affiliate" of a Member means (1) any Person directiy or indirectly, through one or more intermediaries, controlling, controlled by, or under common control with the Member. The term "control" (including the terms "controlled by" and "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through membership, owner ship of voting securities, by contract, or otherwise. 1.5 "Agreement" means this operating agreement, as originally executed and as amended itom time to time. 1.6 "Articles of Organization" is defined in Corporations Code §17001(b). 1.7 "Assignee" means a person who has acquired a Member's Economic Interest in the Company, by way of a Transfer in accordance with the terms of this Agreement, but who has not become a Member. 1.8 "Assigning Member" means a Member who by means of a Transfer has transferred an Economic Interest in the Company to an Assignee. 1.9 "Available Cash" means all net revenues fi-om the Company's operations, including net proceeds fi'om all sales, refinancing, and other dispositions of Company property that the Manager, m the Manager's sole discretion, deems in excess of the amount reasonably necessary for the operating requirements of the Company, including debt reduction and Reserves. 1.10 "Book Depreciation" is defined in Article IV, Section 4.3(b). 1.11 "Capital Account" means, with respect to any Member, the account reflecting the capital interest ofthe Member m the Company, consisting of the Member's initial Capital Contribution maintained and adjusted in accordance with Article in. Section 3.4. 1.12 "Capital Contribution" means, with respect to any Member, the amount of the money and the Fair Market Value of any property (other than money) contributed to the Company (net of liabilities secured by such contributed property that the Company is considered to assume or take "subject to" under IRC Section 752) in consideration of a Percentage Interest held by such Member. A Capital Contribution shall not be deemed a loan. 1.13 "Capital Event" means a sale or disposition of substantially all of the Company's assets, the receipt of insurance and other proceeds derived from the involuntary conversion of Company property, the receipt of proceeds from a refinancing of Company property, or a similar event with respect to Company property or assets. 1.14 "Code" or "IRC" means the Intemal Revenue Code of 1986, as amended, and any successor provision. 1.15 "Company" means the company named in Article n. Section 2.2 of this Agreement. 1.16 "Company Minimum Gain" is defined in Article IV, Section 4.3(c). 1.17 "Confidential Information" is defined in Article X, Section 10.2. »TdeU\<:\Clienu - A\K>dachVCotuge Row Carlsbad LLC\ColUge Row Carlsbad Op Agt 70510. wpd 1.18 "Corporations Code" ("Corp C") means the Califomia Corporations Code. 1.19 "Economic Interest" means a Person's right to share in the income, gains, losses, deductions, credit or similar items of, and to receive distributions from, the Company, but does not include any other rights of a Member, including the right to vote or to participate in management of the Company. 1.20 "Encumber" means the act of creating or purporting to create an Encumbrance, whether or not perfected under applicable law. 1.21 "Encumbrance" means, with respect to any Membership Interest, or any element thereof, a mortgage, pledge, security interest, lien, proxy coupled with an interest (other than as contemplated in this Agreement), option, or preferential right to purchase. 1.22 "Fair Market Value" means, with respect to any item of property of the Company, the item's adjusted basis for federal income tax purposes, except as follows: (a) The Fair Market Value of any property contributed by a Member to the Company shall be the value of such property, as mutually agreed by the contributing Member and the Company; (b) The Fair Market Value of any item of Company property distributed to any Member shall be the value of such item of property on the date of distribution as mutually agreed by the distributee Member and the Company; (c) The Fair Market Value of Company property shall be subject to the adjustments specified in Article FV, Section 4.11; and (d) The Fair Market Value for purposes of Article VIII, Section 8.8, shall be as determined in that section. 1.23 "Initial Members" means those Persons whose names are set forth in the first sentence of this Agreement. A reference to an "Initial Member" means any of the Initial Members. 1.24 "Involuntary Transfer" means, with respect to any Membership Interest, or any element thereof, any Transfer or Encumbrance, whether by operation of law, pursuant to court order, foreclosure of a security interest, execution of a judgment or other legal process, or otherwise, including a purported transfer to or from a tmstee in bankmptcy, receiver, or assignee for the benefit of creditors. 1.25 "Losses." See Article IV, Section 4.2. 1.26 "Maj ority of Members" means a Member or Members whose Percentage Interests represent more than 50 percent of the Percentage Interests of all the Members. 1.27 "Manager" or "Managers" means the Person(s) named as such m Article II or the Persons who from time to time succeed any Person as a Manager and who, in either case, is or are serving at the relevemt time as a Manager. HTdetlVc\CUanu •• AVRsdacMCottage Row Carlsbad LLC\Cotla|e Row Caiisbad Op Agt 70S10.wpd -3- 1.28 "Member" means an Initial Member or a Person who otherwise acquires a Membership Interest, as pennitted under this Agreement, and who remains a Member. 1.29 "Member Nonrecourse Debt" is defined in Article IV, Section 4.3(f). 1.30 "Member Nonrecourse Debt Minimum Gain" is defined in Article FV, Section 4.3(e). 1.31 "Member Nonrecourse Deductions" is defined in Article IV, Section 4.3(0- 1.32 "Membership Interest" means a Member's rights in the Company, collectively, including the Member's Economic Interest, any right to Vote or participate in management, and any right to information conceming the business and affairs of the Company. A Member's Membership Interest shall equal that Member's Percentage Interest. 1.33 "Nonrecourse Deductions" is defined in Article FV, Section 4.3(g). 1.34 "Nonrecourse Liability" is defined in Article IV, Section 4.3(h). 1.35 "Notice" means a written notice required or permitted under this Agreement. A notice shall be deemed given or sent three (3) days after being deposited, as certified mail or for ovemight delivery, postage and fees prepaid, with the United States Postal Service; when delivered by Federal Express, United Parcel Service, DHL Worldwide Express, Airbome Express or other reputable commercial overnight delivery service, when personally delivered to the recipient; when transmitted by electronic means, and such transmission is electronically confirmed as having been successfully transmitted. 1.36 "Percent of the Members" means the specified total of Percentage Interests of all the Members. 1.37 "Percentage Interest" of a Member means a fiction, expressed as a percentage, equal to that Member's percentage of Profits specified in Article FV, Section 4.1. 1.38 "Person" means an individual, partnership, limited partnership, trust, estate, association, corporation, limited iiabiiity company, or other entity, whether domestic or foreign. 1.39 [Reserved.] 1.40 "Profits" and "Losses" are defined in Article FV, Section 4.2. 1.41 "Proxy" has the meaning set forth in the first paragraph of Corp C § 17001 (aXi). 1.42 "Regulations" ("Reg") means the income tax regulations promulgated by the United States Department of the Treasury and published in the Federal Register for the purpose of interpreting and applying the provisions of the Code, as such Regulations may be amended from time to time, including corresponding provisions of applicable successor regulations. 1.43 "Reserves" means the aggregate of reserve accounts that the Manager, in the Manager's reasonable discretion, deems necessary to meet accmed or contingent liabilities ofthe Company, reasonably anticipated operating expenses, and working capital requirements. V\Tdell\c\Clients - A\Radach\Conage Row Carlsbad LLC\CatUge Row Carlsbad Op Agt 705IO.wpd -4- 1.44 "Successor in Interest" means an Assignee, a successor of a Person by merger or otherwise by operation of law, or a transferee of all or substantially all of the business or assets of a Person. 1.45 "Tax Item" means each item of income, gain, loss, deduction, or credit, or item thereof, of the Company. 1.46 "Tax Matters Member" means such Person as may be designated under Article VI, Section 6.6. 1.47 "Transfer" means, with respect to a Membership Interest or any element of a Membership Interest, any sale, assignment, gift. Involuntary Transfer, Encumbrance, or other disposition of such a Membership Interest or any element of such Membership Interest, directly or indirectly, other than an Encumbrance that is expressly permitted under this Agreement. 1.48 "Triggering Event" is defined in Article VIII, Section 8.4. 1.49 "Unretumed Capital Contribution" means the excess, if any, of (a) the aggregate Capital Contributions of each Member as of the date of any distribution, over (b) the sum of all prior distributions made to such Member pursuant to Section 4.14(b). 1.50 "Vote" means a written consent or approval or a ballot cast at a meeting. 1.51 "Voting Interest" means, with respect to a Member, the right to Vote or participate in management and any right to information conceming the business and affairs of the Company provided imder the Act, except as limited by the provisions of this Agreement. A Member's Voting Interest shall equal that Member's Percentage Interest. ARTICLE II: ARTICLES OF ORGANIZATION AND OTHER MATTERS 2.1 The Articles of Organization were filed with the Califomia Secretary of State on or about May 8, 2007. 2.2 The name of the Company shall be "COTTAGE ROW CARLSBAD LLC". 2.3 The principal executive office of the Company shall be at 479 OCEAN AVENUE, SUITE B, LAGUNA BEACII, CA 92651, or such other place or places as may be determined by the Manager from time to time. 2.4 The initial agent for service of process on the Company shall be Wayne A. Ybarra, Esq., whose address is 479 Ocean Avenue, Suite B, Laguna Beach, Califomia 92651. The Manager, after written notice to the Members, may from time to time change the Company's agent for service of process. 2.5 The Company vras formed for the purposes of ACQUIRING, DEVELOPING, MANAGING AND SELLING REAL PROPERTY, together with business activities related thereto, and such other purposes as a Majority of the Members may decide. WTdellVcVCIienU - A\Radach\Cottage Row Carlsbad LLCNCotUge Row Carlsbad Op Agt 705IO.wpd 2.6 The Members intend the Company to be a limited liability company under the Act. Neither the Manager nor any Member shall take any action inconsistent with the express intent of the parties to this Agreement. 2.7 The term of existence of the Company shall commence on the effective date of filing of Articles of Organization with the Califomia Secretary of State, and shall continue until the date specified in the Articles of Organization (if any), unless sooner terminated by the provisions ofthis Agreement or as provided by law. 2.8 The names of the Initial Member(s) is/are as set forth at the beginning of this Agreement. 2.9 the Members shall be the Manager of the Company. References herein to "Manager" shall mean in each instance the Members (and if voting be necessary or appropriate, voting in accordance with each Member's Percentage Interest). 2.10 The Members hereby agree that the Company's officers are and shall be: Russel R. Radach, President (CEO) and Assistant Secretary; Judith A. Gorski, Vice-President, Treasurer (CFO) and Assistant Secretary; and Roderick H. Harron, Secretary. A Majority of the Members may at any time replace any or all of the officers of the Company. 2.11 Except as otherwise specifically provided in Section 5.4, below, unless and until altered by vote of a Majority of Members, the President or a Vice President, acting together with the Secretary or an Assistant Secretaiy, may contractually bind the Company in any amount. ARTICLE III: CAPITAL AND CAPITAL CONTRIBUTIONS 3.1 (a) The Company's initial capital shall consist of cash, and other consideration, to be contributed by the Members on or before JULY 3,2007, in the following amounts: Name Amount Radach $3390,000.00 Harron/Gorski $1,130.000.00 TOTAL $4,520,000.00 (b) Each Member shall contribute to the capital ofthe Company as the Member's Initial Capital Contribution the money and/or property specified above. If a Member fails to make the initial Capital Contributions specified in this Section within fifteen (15) days after the date specified, that Member shall indemnify and hold the Company and the other Members harmless from any loss, cost, or expense, including reasonable attomey fees caused by the failure to make the Initial Capital Contribution. \\Tdell\c\Clients - AUladacMCotUge Row Carlsbad LLC\Catug« Row Caritbad Op Agt 70SI0.wpd 3.2. The Manager may determine from time to time that Capital Contributions in addition to the Members' initial Capital Contributions are needed to enable the Company to conduct its business. On making such a determination, the Manager shall give notice to all Members in writing at least 90 days before the date on which such additional capital Contribution is due. The Notice shall set forth the amount of additional Capital Contribution needed, the purpose for which It is needed, and the date by which the Members shall contribute. Each Member shall be required to make an additional Capital Contribution in an amount that bears the same proportion to the total additional Capital Contribution that such Member's Capital Account balance bears to the total Capital Account balances of all Members. No Member may voluntarily make any additional Capital Contribution. Notwithstanding anything to the contrary herein, the maximum amount of additional Capital Contributions that a Member may be required to make is twenty-five percent (25%) ofthe amount of the Member's initial Capital Contribution under Section 3.1 of this Agreement. 3.3. If a Member fails for 30 days to make an additional Capital Contribution required under Section 3.2: (a) The Defaulting Member shall indemnify and hold the Company and the other Members harmless from any loss, cost, or expense, including reasonable attomey fees caused by the failure to make the additional Capital Contribution. Such additional Capital Contributions that are not made by a Defaulting Member are referred to as Additional Capital Short-fall. A Member who makes the respective required additional Capital Contributions (Nondefaulting Member) shall have the right, but not the obligation, to advance an amount bearing the same ratio to the total amount of the Additional Capital Shortfall as a Nondefaulting Member's Capital Account bears to the total Capital Accounts of all Nondefaulting Members. A Member advancing an additional Capital Contribution for a Defaulting Member under this Section 3.3(a) shall: (1) be paid interest by the Defaulting Member on the amount of such advance at an annual rate, from the date of the advance until paid, equal to the floating rate of two percent (2.0%) over the prime rate charged by Bank of America (or its successor), or the highest rate permitted by applicable law, whichever rate is lower; and (2) receive all distributions that the Defaulting Member would otherwise be entitied to receive under the provisions of this Agreement as though the advances by the Nondefauhing Member were Capital Contributions made by suchNondefaidting Member, which distributions shall be applied first to attomeys' fees, costs, and expenses, if any; then to accmed and unpaid interest; and, fuially, in reduction of the principal amount of such advance. The Defaulting Member grants any Nondefaulting Members who make advances to the Company in accordance with this Section 3.3(a) a security interest in the Defaulting Member's Membership Interest to secure the E)efaulting Member's obligations under this Section 3.3(a). The Defaulting Member shall, within five days of written notice, execute any documents or instruments reasonably necessary to enable Nondefaulting Members who make advances hereunder to perfect the foregoing security interests. Each Member irrevocably appoints each other Member, and any one of them acting alone, as his, her, or its attomey-in-fact for the limited purpose of executing, on behalf of such Member, if such Member becomes a Defaulting Member, any of the foregoing docimients or instmments. (b) If the Defauhing Member fails to pay all sums due and owing to any Members who make advances under Section 3.3(a), for a period of 180 days after such advance, each Member who has made advances under Section 3.3(a) may foreclose on any security interest granted under this Section 3.3 by causing the principal amount of such advance to be transferred from the Defaulting Member's Capital Account and added to the Capital Account of the Member who has made such advances, with a corresponding adjustment in that Member's and the Defauhing Member's Percentage Interests. Accmed and unpaid interest and other amounts owed to Members- who have \\Tdell\c\Clieiils -- AVRadacMCottags Row Carlsbad LLC\Cotuge Row Caiisbad Op Agt 70S10 wpd •7- made advances hereunder (the Noncapital Costs) shall also be paid out of the Defaulting Member's Capital Account, and if the Capital Account is not sufficient to fiilly pay Noncapital Costs, the available balance shall be shared pro rata in accordance with the amounts of the Nondefaulting Members' respective advances. The Defaulting Member's Percentage Interest shall be fiirther adjusted (but not below zero) following application to Noncapital Costs. All Members hereby agree that the foregoing constitutes and will constitute a disposition of collateral in a commercially reasonable manner within the meaning of Califomia Commercial Code §9610. Reduction of a Defaulting Member's Capital Account to satisfy such member's repayment obligations under this Section 3.4(b) shall be deemed a retum of capital to that Member to the extent of such reduction. (c) On the occurrence of, and forthe duration of, a Defauh by any Member, the Defaulting Member shall not have any right to vote the Defaulting Member's Membership Interest or otherwise participate in the management or control of the business and af&irs of the Company and any and all provisions of this Agreement with respect to management and control shall be deter-mined without including the Membership Interest of the Defaulting Member. The foregoing provisions shall be m addition to the Company's remedies under Corporations Code §1720I(aX2). On satisfaction of a Defaulting Member's obligations (whether by enforcement of a remedy or otherwise) under Section 3.3(b), that Member shall be restored to fiill membership status to the extent of any remaining Percentage Interest. 3.4 An individual Capital Account for each Member shall be maintained and adjusted in accordance with the following provisions: (a) A Member's Capital Account shall be increased by that Member's Capital Contributions, that Member's share of Profits, and any items in the nature of income or gain that are specially allocated to that Member pursuant to Article IV. (b) A Member's Capital Account shall be mcreased by the amount of any partnership liabilities assumed by that Member subject to and in accordance with the provisions of Reg § 1.704-1 (bX2Xiv)(c). (c) A Member's Capital Account shall be decreased by (a) the amount of cash distributed to that Member; (b) the Fair Market Value of any property of the Company so distributed, net of liabilities secured by such distributed property that the distributee Member is considered to assume or to be subject to under IRC Section 752; and (c) the amount of any items in the nature of expenses or losses that are specially allocated to that Member pursuant to Article IV. (d) A Member's Capital Account shall be reduced by the Member's share of any expenditures ofthe Company described in IRC Section 705(aX2)(B) or which are treated as IRC Section 705(aX2)(B) expenditures pursuant to Reg Section 1.704-1 (bX2XivXi) (including syndication expenses and losses nondeductible under IRC Sections 267(aXl) or 707(b). (e) If any Economic Interest (or portion thereof) is transferred, the transferee of such Economic Interest or portion shall succeed to the transferor's Capital Account attributable to such interest or portion. (f) The principal amount of a promissory note that is not readily traded on an established securities market and that is contributed to the Company by the maker ofthe note shall not be included in the Capital Account of any Person until the Company makes a taxable disposition ofthe note or until (and to the extent) principal payments are made on the note, all in accordance with Reg Section \\Td«ll\c\ClieiiU - A\Radacb\Cottage Row Cartsbad LLCVCotuge Row Carlsbad Op Agt 70510.wpd -8- 1.704-l(bX2Xiv)(dX2). (g) Each Member's Capital Account shall be increased or decreased as necessary to reflect a revaluation of the Company's property assets in accordance with the requirements of Reg Sections 1.704-1 (bX2Xiv)(f) and 1.704-1 (bX2XivXg), including the special mles under Reg Section 1.701 -1 (bX4), as applicable. The provisions of this Agreement respecting the maintenance of Capital Accounts are intended to comply with Reg Section 1.704-1 (b) and shall be interpreted and applied in a maimer consistent with those Regulations. 3.5 A Member shall not be entitled to withdraw any part ofthe Member's Capital Contribution or to receive any distributions, whether of money or property, from the Company except as provided in this Agreement. 3.6 Except as set forth in Sections 1.39,4.2(f) and 4.6(a) and 4.14(a) of this Agreement, no interest shall be paid on Capital Contributions or on the balance of a Member's Capital Account 3.7 A Member shall not be bound by, or be personally liable for, the expenses, liabilities, or obligations of the Company except as otherwise provided in the Act or in this Agreement. 3.8 Except as otherwise expressly set forth in this Agreement, no Member shall have priority over any other Member with respect to the return of a Capital Contribution or distributions or allocations of income, gam, losses, deductions, credits, or items thereof ARTICLE IV: ALLOCATIONS AND DISTRIBUTIONS 4.1 The Profits and Losses of the Company and, except as otherwise set forth in this Agreement, all items of Company income, gain, loss, deduction, or credit shall be allocated, as follows: Percentage Interest Name Profits Losses Radach 75.00% 75.00% Harron/Gorski 25.00% 25.00% TOTALS 100.00% 100.00% 4.2 As used in this Agreement, "Profits and Losses" means, for each fiscal year or other period specified in this Agreement, an amount equal to the Company's taxable income or loss for such year or period, detennined in accordance with IRC Section 703(a), including all Tax Items required to be stated separately pursuant to IRC Section 703(aXl), with the following adjustments: (a) Any income of the Company that is exempt from federal mcome tax and not otherwise taken into account in computing Profits or Losses shall be added to such taxable income or loss; (b) Any expenditures ofthe Company described m IRC Section 705(aX2XB) or treated as IRC Section 705(aX2XB) expenditures pursuant to Reg Section 1.704-1 (bX2XivXi) and not otherwise taken \\Tdell\c\Clieiits - A\Radach\ColUg> Row Carisbad LLC\CotUge Row Caritbad Op Agt 70510 wpd into account in computing Profits or Losses shall be subtracted from such taxable income or shall increase such loss; (c) Gam or loss resulting from any disposition of Company property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Fair Market Value of the property disposed of, notwithstanding that the adjusted tax basis of such property differs from its Fair Market Value; (d) In lieu of depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Book Depreciation for such fiscal year or other period, computed in accordance with the definition of "Book Depreciation" in Section 4.3(b); and (e) Notwithstanding the foregoing provisions ofthis Section 4.2, any items of income, gain, loss, or deduction that are specially allocated shall not be taken into account in computing Profits or Losses under Section 4.1. 4.3 The following definitions shall apply with respect to this Article FV: (a) "Adj usted Capital Account Deficit" means, with respect to any Member, the deficit balance, if any, in such Member's Capital Account as of the end of the relevant fiscal year of the Company, after such Member's Capital Accoimt has been adjusted as follows: (1) the Member's Capital Account shall be increased by the amount of such Member's share of Company Minimum Gain and Member Nonrecourse Debt Minimum Gain; and (2) the Member's Capital Account shall be decreased by the amount of the items described in Reg sections l.704-l(bX2XiiXdX4), (5), and (6). This definition of Adjusted Coital Account Deficit is intended to comply with the provisions of Reg Section 1.704-1 (bX2)(ii)(d) and shall be interpreted consistently with that Regulation. (b) "Book Depreciation" means, with respect to any item of Company property for a given fiscal year, a percentage of depreciation or other cost recovery deduction allowable for federal income tax purposes for such item during that fiscal year equal to the result (expressed as a percentage) obtained by dividing (1) the Fair Market Value of that item at the beginning ofthe fiscal year (or the acquisition date during the fiscal year), by (2) the adjusted tax basis of the item at the beginning of the fiscal year (or the acquisition date during the fiscal year). If the adjusted tax basis of an item is zero, the Manager may determine Book Depreciation, provided that he does so in a reasonable and consistent manner. (c) "Company Minimum Gain" has the meaning set forth in Reg Section 1.704-2(dX I). (d) "Member Nonrecourse Debt" is defined in Reg Section 1.704-2(bX4). (e) "Member Nonrecourse Debt Minimum Gain" for a fiscal year ofthe Company means the net increase in Minimum Gain attributable to Member Nonrecourse Debt, determined as set forth in Reg Section 1.704-2(iX2). (f) "Member Noiu-ecourse Deductions" has the meanmg set forth in Reg section 1.704-2(1X2). For any fiscal year of the Company, the amount of Member Nonrecourse Deductions with respect to a Member Nonrecourse Debt equals the net increase during that fiscal year in Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt during that fiscal year, reduced (but not below zero) by the amount of any distributions during such year to the Member bearing the economic risk WTdellVcVCIionls - A\Ridacb\Cotuge Row Caritbad LLC\CotUge Row Caritbad Op Agt 705IO.wpd -10- of loss for such Member Nom^course Debt if such distributions are both from the proceeds of such Member Nonrecourse Debt and are allocable to an increase in Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt, all as determined according to the provisions of Reg section 1.704-2(iX2). In detemiining Member Nonrecourse Deductions, the ordering mles of Reg Section 1.704-20) shall be followed. (g) "Nonrecourse Deductions" has the meaning set forth in Reg section 1.704-2(c). The amount of Nonrecourse Deductions for a Company fiscal year equals the net increase in the amount of Company Minimum Gain during that fiscal year, reduced (but not below zero) by the aggregate amount of any distributions during that fiscal year of proceeds of a Nonrecourse Liability that are allocable to an increase in Company Minimum Gain. (h) "Nonrecourse Liability" is defined in Reg Section 1.752-1 (aX2). 4.4 [Reserved.] 4.5 Member Non-Recourse Deductions for any fiscal year of the Company shall be allocated to the Members in the same proportion as Profits are allocated under Section 4.1, provided that any Member Nonrecourse Deductions for any fiscal year or other period shall be allocated to the Member who bears (or is deemed to bear) the economic risk of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in accordance with Reg Section 1.704-2(1X2). 4.6 In any fiscal year of the Company, Profits m excess of Losses of the Company resulting from a Capital Event in that Fiscal Year shall be allocated to the Members in the following order: Proportionally to the Members in accordance with their Percentage Interests. 4.7 In any fiscal year of the Company, Losses in excess of Profits of the Company, resulting from a Capital Event in that fiscal year, shall be allocated to the Members with positive Capital Accounts, in proportion to their positive Capital Account balances, until no Member has a positive Capital Account. For this purpose. Capital Accounts shall be reduced by the adjustments set forth in Reg Sections 1.704-1 (bX2XiiXdX4), (5) and (6). 4.8 Any unrealized appreciation or unrealized depreciation in the values of Company property distributed in kind to Members shall be deemed to be Profits or Losses realized by the Company immediately prior to the distribution of the property and such Profits or Losses shall be allocated to the Capital Accounts in the same proportions as Profits are allocated under Section 4.1. Any property so distributed shall be treated as a distribution to the Members to the extent of the Fair Market Value of the property, less the amount of any liability secured by and related to the property. Nothing contained in this Agreement is intended to treat or cause such distributions to be treated as sales for value. For the purposes ofthis Section 4.8, "unrealized appreciation" or "unrealized depreciation" shall mean the difference between the Fair Market Value of such property and the Company's basis for such property. 4.9 Any item of income, gain, loss, or deduction with respect to any property (other than cash) that has been contributed by a Member to the coital of the Company, or that has been revalued pursuant to the provisions of Article m, Section 3.3(g), and that is required or permitted to be allocated to such Member for income tax purposes under IRC Section 704(c) in order to take into account the variation between the tax basis of such property and its Fair Market Value at the time of its contribution, shall be allocated solely for income tax purposes in the marmer required or permitted under IRC Section 704(c) using the "traditional" method described in Reg Section 1.704-3(b), except that any other method allowable under applicable \\TdellW\Clieiiu •- A\Radach\Cottage Row Caritbad LLC\CotUge Row Caritbad Op Agt 70510 wpd -11- Regulations may be used for any contribution of property with respect to which there is agreement among the contributing Member and the Manager (and, if the Manager and the contributing Member are Affiliates, a Majority of Members who are not Affiliates of the Manager). 4.10 In the case of a Transfer of an Economic Interest during any fiscal year of the Company, the Assigning Member and Assignee shall each be allocated Profits or Losses based on the number of days each held the Economic Interest during that fiscal year. If the Assigning Member and Assignee agree to a different proration and advise the Manager of the agreed proration before the date of the Transfer, Profits or Losses from a Capital Event during that fiscal year shall be allocated to the holder of the Interest on the day such Capital Event occurred. If an Assignee makes a subsequent Assignment, said Assignee shall be considered an "Assigning Member" with respect to the subsequent Assignee for purposes ofthe aforesaid allocations. 4.11 (a) The Fair Market Value of all Company property shall be adjusted as of the following times: (1) the acquisition of an interest or additional interest in the Company by any new or existing Member in exchange for more than a de minimis Capital Contribution; (2) the distribution of money or other property (other than a de minimis amount) by the Company to a Member as consideration for an Economic Interest in the Company, and (3) the liquidation ofthe Company within the meaning of Reg Section 1.704-1 (bX2XiiXg); provided, however, that adjustments under clauses (1) and (2) above shall be made only in the event of a revaluation of Company property under Article III, Section 3.3(g) in accordance with Reg Section 1.704-l(bX2)(iv)(0. (b) The Fair Market Value of Company property shall be increased or decreased to reflect adjustments to the adjusted tax basis of such property pursuant to IRC Section 732, IRC Section 733, or IRC Section 743, subject to the limitations imposed by IRC Section 755 and Reg Section 1.704-1 (bX2Xiv)(m); and (c) If the Fair Market Value of an item of property has been determined or adjusted pursuant to Article I, Section 22 or Paragraph (a) or (b) of this Section 4.11, such Fan* Maricet Value shall be adjusted by the Book Depreciation, if any, taken into account with respect to such property for purposes of computing Profits and Losses. 4.12 It is the intent of the Members that each Member's allocated share of Company Tax Items be detemiined in accordance with this Agreement to the fullest extent pennitted by IRC Sections 704(b) and 704(c). Notwithstanding anything to the contrary contained in this Agreement, if the Company is advised that, as a result of the adoption of new or amended regulations pursuant to IRC Sections 704(b) and 704(c), or the issuance of authorized interpretations, the allocations provided in this Agreement are unlikely to be respected for federal income tax purposes, the Manager is hereby granted the power to amend the allocation provisions of this Agreement, on advice of accountants and legal counsel, to the minimum extent necessary to cause such allocation provisions to be respected for federal income tax purposes. 4.13 All Available Cash, other than revenues or proceeds from a Capital Event or the dissolution of the Company, shall be distributed among the Members in the same manner as Profits (as provided m Section 4.6, above). The parties intend that Available Cash shall be distributed as soon as practicable following the reasonable determination by the Manager that such cash is available for distribution, but in no event less than annually and on or before the earlier to occur in each calendar year of (a) the date which is 120 days after the end of the Company's fiscal year and (b) March 15*. The parties acknowledge that no assurances can be given with respect to when or whether said cash will be available for distributions to the Members. 4.14 As soon as practicable following the reasonable determination by Manager that such cash is \\Tdall\c\Cllsats - A\Radach\Catuge Row Carisbad LLC\Cottage Row Carlsbad Op\ft 70SI0.wpd -12- available for distribution, but in no event later than ninety (90) days following such Capital Event, a 11 Available Cash resulting from a Capital Event (as distinguished from normal business operations or the dissolution of the Company) shall be distributed to the Members in accordance with this Section 4.14 as follows: Proportionally to the Members in accordance with their Percentage Interests. 4.15 If the proceeds from a sale or other disposition of an item of Company property consist of property other than cash, the value of that property shall be as determined by the Manager. If such noncash proceeds are subsequently reduced to cash, such cash shall be taken into account by the Manager in determining Available Cash and the Manager shall determine whether such cash has resulted from operations or from a Capital Event. 4.16 Notwithstanding any other provisions of this Agreement to the contrary, when there is a distribution in liquidation ofthe Company, or when any Member's interest is liquidated, all items of income and loss first shall be allocated to the Members' Capital Accounts under this Article FV, and other credits and deductions to the Members' Capital Accounts shall be made before the final distribution is made. The final distribution to the Members shall be made as provided in Article IX, Section 9.2(d) of this Agreement. The provisions of this Section 4.16 and Article DC, Section 9.2(d) shall be constmed in accordance with the requirements of Reg Section 1.704-1 (bX2)(iiXbX2). 4.17 The Company shall make, no later than March 30*^ of each fiscal year of the Company ("Fiscal Year"), a distribution to each Member of an amount equal to (a) the net amount of Company taxable income allocated to such Member for the preceding Fiscal Year, multiplied by (b) 45%. The foregoing distribution is referred to herein as a "Tax Distribution." Any Tax Distribution made to a Member shall be treated as an advance distribution to such Member pursuant to (and shall reduce the amount of distributions otherwise distributable to such Member pursuant to) Sections 4.13(b), 4.14(c) and 9.2. ARTICLE V: MANAGEMENT 5.1 The business of the Company shall be managed by the Manager, or successor Manager selected in the manner provided in Article V, Section 5.3, below. Except as otherwise set forth in this Agreement, all decisions concemuig the management of the Company's business shall be made by the Manager. 5.2 Except as otherwise specifically provided in Section 5.4, below, the Memager shall have full, exclusive, and complete discretion, power, and authority, but subject in all cases to the other provisions of this Agreement and the requirements of applicable law, to manage, control, administer, and operate the business and affairs of the Company forthe purposes herein stated, and to make all decisions affecting such business and affairs, including, without limitation, the power to: (a) acquire by purchase, lease, or otherwise, any real or personal property, tangible or intangible; (b) constmct, operate, maintain, finance, and improve, and to own, sell, convey, assign, mortgage, or lease any real estate and any personal property; (c) sell, dispose, trade, or exchange Con^jany assets in the ordinary course of the Company's business; \\Tdell\c\Clients AVRtdacMCotuge Row Carisbad LLCNCotuge Row Carisbad Op Agt 70510.wpd -13- (d) enter into agreements and contracts and to give receipts, releases and discharges; (e) purchase liability and other insurance to protect the Company's properties and business; (f) borrow money for and on behalf of the Company, and, in connection therewith, execute and deliver instruments authorizing the confession of judgement against the Company; (g) execute or modify leases with respect to any part or all of the assets of the Company; (h) prepay, in whole or in part, refinance, amend, modify, or extend any mortgages or deeds of tmst which may affect any asset of the Company and in connection therewith to execute for and on behalf of the Company any extensions, renewals, or modifications of such mortgages or deeds of trust; (i) execute any and all other instmments and document which may be necessary or in the opinion ofthe Manj^er desirable to carry out the intent and purpose of this Agreement, including, but not limited to, documents whose operation and effect extend beyond the term of the Company; (j) make any and all expenditures which the Manager, in his/her/its reasonable discretion, deems necessary or appropriate in connection with the management of the affairs of the Company and the carrying out of its obligations and responsibilities under this Agreement, including, without limitation, expenditures for legal, accounting, and other related expenses incurred in coimection with the organization, financing, and operation of the Company; (k) enter into any kind of legal activity necessary to, in connection with, or incidental to, the accomplishment of the purposes of the Company; and (1) invest and reinvest Company reserves in short-term instmments or money maricet fimds. 5.3 [Reserved.] 5.4 The Manager and the officers shall each have the powers and duties described in Sections 2.11,5.2 and 5.8 hereof and such other powers and duties as may be prescribed in this Agreement or by the Members. Notwithstanding the foregoing, the Manager shall not take any of the following actions on behalf of the Company unless a Majority of Members have consented to the taking of such action: (a) Any act that would make it impossible to carry on the ordinary business of the Company; (b) Any confession of a judgment against the Company; (c) The dissolution ofthe Company; (d) The disposition of all or a substantial part of the Company's assets not in the ordinary course of business; (e) The issuance of additional Membership Interests or the redemption of any Membership Interests by the Company; (f) A material change in the nature of the principal business of the Company; \\Tdtll\c\ClionU - A\Radach\CotUge Row Carisbad LLC\Cottago Row Carisbad Op Agt 70SI0 wpd -14- (g) The filing of a petition in bankmptcy or the entering into of an arrangement among creditors; and (h) The entering into, on behalf of the Company, of any transaction constituting a "merger" or "reorganization" within the meaning of Corp C §17600; 5.5 The Manager shall keep or cause to be kept with the books and records of the Company fiill and accurate minutes of all meetings, notices and waivers of notices of meetings, and all written consents to actions of the Manager. 5.6 The Manager and the officers shall devote such time to the conduct of the business ofthe Company as the Manager, in the Manager's own good faith and discretion, deems necessary. 5.7 Neither the Manager nor the officers of the Company shall be entitled to compensation for his, then- or its services unless otherwise expressly agreed to in writing by a Majority of Members. However, upon substantiation of the amount and purpose thereof, the Manager and officers of the Company shall be entitied to reimbursement for expenses reasonably incurred and advances reasonably made in furtherance ofthe business of the Company. 5.8 The Company shall have a President, who shall be or act on behalf of the Company. The President shall be the chief executive officer of the Company and shall have general supervision of the business and af&irs of the Company, shall preside at all meetings of Members, and shall have such other powers and duties usually vested in a chief executive officer. A Majority of the Members may provide for additional officers of the Company, may alter the powers and duties of the President, and shall establish the powers and duties of all other officers and the compensation of all Company officers; provided, however, that the powers and duties of the President or any other officer of the Company shall not be expanded beyond those of the Manager without the consent of a Majority of Members. 5.9 The Manager shall cause all assets of the Company, whether real or personal, to be held in the name of the Company. 5.10 All fimds ofthe Company shall be deposited in one or more accounts with one or more recognized financial institutions in the name of the Company, at such locations as shall be determined by the Manager. ARTICLE VI: ACCOUNTS AND ACCOUNTING 6.1 Complete books of account ofthe Company's business, in which each Company transaction shall be fully and accurately entered, shall be kept at the Company's principal executive office and at such other locations as the Manager shall determine from time to time and shall be open to inspection and copying on reasonable Notice by any Member or the Member's authorized representatives during normal business hours. The costs of such inspection and copying shall be borne by the Member. 6.2 Financial books and records of the Company shall be kept on the cash method of accounting, which shall be the method of accounting followed by the Company for federal income tax purposes. The financial statements of the Company shall be prepared in accordance with generally accepted accounting principles WTdellWVCUenU - A\Radacb\CotUge Row Caritbad LLC\CatUge Row Carisbad Op Agt 7aSI0.wpd -15- consistently applied and shall be appropriate and adequate for the Company's business and for carrying out the provisions of this Agreement. The fiscal year of the Company shall be January 1 through December 31. 6.3 At all times during the term of existence of the Company, and beyond that term if the Manager deems it necessary, the Manager shall keep or cause to be kept the books of account referred to in Section 6.2, together with; (a) A current list of the full name and last known business or residence address of each Member, together with the Capital Contribution and the share in Profits and Losses of each Member; (b) A current list of the fiill name and business or residence address of each Manager; (c) A copy of the Articles of Organization, as amended; (d) Copies of the Company's federal, state, and local income tax or information retums and reports, if any, for the six most recent taxable years; (e) An original executed copy or counterparts of this Agreement, as amended; (f) Any powers of attomey under which the Articles of Organization or any amendments to said articles were executed; (g) Financial statements of the Company for the six most recent fiscal years; and (h) The books and Records of the Company as they relate to the Company's intemal affairs for the current and past four fiscal years. If the Manager deems that any of the foregoing items shall be kept beyond the term of existence of the Company, the repository of said items shall be as designated by the Manager. 6.4 At the end of each fiscal year the books of the Company shall be closed and examined and statements (audited or unaudited, at the sole discretion of the Manager) reflecting the financial condition of the Company and its Profits or Losses shall be prepared, and a report thereon shall be issued by the Company's certified public accountant and promptly delivered to each Member. If there are more than thirty-five (35) Members: (a) The Manager shall deliver to each Member, within 120 days after the end of the fiscal year of the Company, a financial statement that shall include a balance sheet and income statement, and a statement of changes in the financial position of the Company as of the close of the fiscal year; and (b) Members representing at least five percent (5%) of the Voting Interests of all the Members (or three or more Members) may request of the Manager in writing, interim balance sheets and income statements for one or more quarterly periods ending more than 30 days prior to such request, in which event such statements shall be mailed to the Members within 30 days thereafter. 6.5 Within 90 days after the end of each taxable year of the Company the Manager shall send to each of the Members all information necessary for the Members to complete their federal and state income tax or information retums. If there are 35 or fewer Members, there shall also be supplied within such 90-day WTdellWVCUonu - AAadackVCotuge Row Carisbad LLCXotUgo Row Caritbad Op Agt 705IO.wpd -16- period, a copy ofthe Company's Federal, State and local income tax or information retums for the year. 6.6 Harron/Gorski shall act as Tax Matters Member of the Company pursuant to IRC Section 6231 (aX7). 6.7 The Tax Matters Member is hereby authorized to do the following: (a) Keep the Members informed of administrative and judicial proceedings for the adjustment of Company items (as defined in IRC Section 6231(aX3)) at the Company level, as required under IRC Section 6223(g) and the implementing Regulations; (b) Enter into settlement agreements under IRC Section 6224(cX3) and ^plicable Regulations with the Intemal Revenue Service or the Secretary of the Treasury (the Secretary) with respect to any tax audit or judicial review, in which agreement the Tax Matters Member may expressly state that such agreement shall bind the other Members, except that such settlement agreement shall not bind any Member who (within the time prescribed under the Code and Regulations) files a statement with the Secretary providing that the Tax Matters Member shall not have the authority to enter into a settlement agreement on behalf of such Member; (c) On receipt of a notice of a final Company administrative adjustment, to file a petition for readjustment of the Company items with the Tax Court, the District Court of the United States for the district in which the Company's principal place of business is located, or the United States Court of Federal Claims, all as contemplated under IRC Section 6226(a) and applicable Regulations; (d) File requests for administrative adjustment of Company items on Company tax retums under IRC Section 6227(b) and applicable Regulations; and, to the extent such requests are not allowed in fiill, file a petition for adjustment with the Tax Court, the District Court of the United States for the district in which the Company's principal place of business is located, or the United States Court of Federal Claims, all as contemplated under IRC Section 6228(a); and (e) To take any other action on behalf of the Members or the Company in connection with any administrative or judicial tax proceeding to the extent permitted by law or regulations, including retaining tax advisers (at the expense of the Company) to whom the Tax Matters Member may delegate such rights and duties as deemed necessary and appropriate. ARTICLE VII: MEMBERSHIP MEETINGS. VOTING. INDEMNITY 7.1 There shall be only one class of membership and no Member shall have any rights or preferences in addition to or different from those possessed by any other Member except as otherwise expressly set forth in this Agreement. A Majority of the Members shall have the right to Vote on all matters with respect to which this Agreement or the Act requires such Member action. Each Member shall Vote in proportion to the Member's Voting Interest as of the goveming record date, determined in accordance with Section 7.2. If a Member has assigned all or part of the Member's Economic Interest to a person who has not been \\TdellVc\Clieiils - A\Radach\CotUge Row Carisbad LLC\CotUge Row Carisbad Op Agt 70510.wpd -17- admitted as a Member, the Assigning Member shall Vote in proportion to the Voting Interest that the Assigning Member would have had, if the assignment had not been made. Without limiting the foregoing, each of the following acts shall require a Majority Vote ofthe Members: (a) A decision to continue the business of the Company after any event mentioned in Article FX, Section 9.1; (b) The Transfer of a Membership Interest and the admission of the Assignee as a Member of the Company; (c) Any amendment of the Company's Articles of Organization or of this Agreement; or (d) A compromise ofthe obligation of a Member to make a Capital Contribution under Article III. 7.2 The record date for determining the Members entitled to receive Notice of any meeting, to Vote, to receive any distribution, or to exercise any right in respect of any other lawful action, shall be the date set by the Manager or by a Majority of Members; provided that such record date shall not be more than 60, or less than ten (10) calendar days prior to the date of the meeting and not more than 60 calendar days prior to any other action. In the absence of any action setting a record date, the record date shall be determined in accordance with Corp C Section 17104(k). 7.3 The Company may, but shall not be required, to issue certificates evidencing Membership Interests ("Membership Interest Certificates") to Members of the Company. Once Membership Interest Certificates have been issued, they shall continue to be issued as necessary to reflect cunent Membership Interests held by Members. Membership Interest Certificates shall be in such form as may be approved by the Manager, shall be manually signed by the Manager (or the officers), and shall bear conspicuous legends evidencing the restrictions on Transfer and the purchase rights of the Company and Members set forth in Article VIE. All issuances, re-issuances, exchanges, and other transactions in Membership Interests involving Members shall be recorded in a permanent ledger as part of the books and records of the Company. Each Membership Interest Certificate shall bear the following legends: THE INTERESTS REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("ACT") OR QUALIFIED AND/OR REGISTERED UNDER STATE SECURITIES LAWS, HAVE BEEN ISSUED AND SOLD EN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND THE QUALIFICATION AND/OR REGISTRATION REQUIREMENTS OF SUCH LAWS AND ARE RESTRICTED SECURITIES AND SHALL NOT BE TRANSFERRED AT ANY TIME IN THE ABSENCE OF (1) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT AND APPLICABLE STATE SECURPTIES LAWS WITH RESPECT TO SUCH INTEREST, OR (2) AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO THE COMPANY'S LEGAL COUNSEL, TO THE EFFECT THAT THE PROPOSED TRANSFER WILL NOT VIOLATE THE ACT OR ANY APPLICABLE STATE SECURITIES LAWS. BY ACCEPTANCE OF THIS CERTMCATE, THE HOLDER HEREOF COVENANTS THAT (S)HE/IT WILL COMPLY IN ALL RESPECTS WITH THE FOREGOING RESTRICTION ON TRANSFER. THESERESTRICTED SECURITIES HAVE BEEN ACQUIRED FOR HOLDER'S OWN ACCOUNT AND NOT WITH A VIEW TO DISTRIBUTE THEM TO THE PUBLIC. RESTRICTED \VTdBll\c\Clients - AVRadacMCottage Row Cartsbad LLC\Cottege Row Carisbad Op Agt 70510.wpd -18- SECURTTIES MUST BE HELD INDEFINITELY UNLESS THEY ARE SUBSEQUENTLY REGISTERED UNDER THE ACT OR QUALIFIED AND/OR REGISTERED UNDER STATE SECURITIES LAWS WHERE SOLD OR AN EXEMPTION FROM SUCH REGISTRATION OR QUALIFICATION IS AVAILABLE. THE INTERESTS EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO TRANSFER RESTRICTIONS, CERTAIN BUY-OUT RIGHTS, PREFERENCES AND PRIVILEGES IN ACCORDANCE WITH TERMS SET OUT EITHER IN THE ARTICLES OF ORGANIZATION, ANY AMENDMENTS THERETO, OR THE OPERATING AGREEMENT OF THIS LIMITED LIABILITY COMPANY. A COPY OF SAID ARTICLES OF ORGANIZATION, ANY AMENDMENTS THERETO AND OPERATING AGREEMENT MAY BE OBTAINED WITHOUT CHARGE BY A MEMBER UPON WRITTEN REQUEST ADDRESSED TO THE MANAGER, MANAGING MEMBER OR SECRETARY, AS APPLICABLE, OF THE LIMFTED LL^BILFTY COMPANY AT FTS PRINCIPAL OFFICE. 7.4 Meetings of the Members may be called at any time by the Manager, or by Members representing at least 10 percent of the Interests of tiie Members for the purpose of addressing any matters on which the Members may Vote. If a meetmg of the Members is called by the Members, Notice of the call shall be delivered to the Mans^er. Meetings may be held at the principal executive office ofthe Company or at such other location as may be designated by the Manager. Following the call of a meeting, the Manager shall give Notice of the meeting not less than ten (10), or more than sixty (60) calendar days prior to the date of the meeting to all Members entitled to Vote at the meeting. The Notice shali state the place, date, and hour of the meeting and the general nature of business to be transacted. No other business may be transacted at the meeting. A quorum at any meeting of Members shall consist of a Majority of Members, represented in person or by Proxy. The Members present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of a sufficient number of Members to leave less than a quorum, if the action taken, other than adjournment, is approved by a Majority of Members. 7.5 A meeting of Members at which a quorum is present may be adjoumed to another time or place and any business which might have been transacted at the original meeting may be transacted at the adjoumed meeting. If a quorum is not present at an original meeting, that meeting may be adjourned by the Vote of a Majority of Voting Interests represented either in person or by Proxy. Notice of the adjourned meeting need not be given to Members entitied to Notice if the time and place of the adjoumed meeting are announced at the meeting at which the adjournment is taken, unless (a) the adjournment is for more than 45 days, or (b) after the adjournment, a new record date is fixed for the adjoumed meeting, hi the situations described in clauses (a) and (b). Notice of the adjourned meeting shall be given to each Member of record entitled to Vote at the adjoumed meeting. 7.6 The transactions of any meeting of Members, however called and noticed, and wherever held, shall be as valid as though consummated at a meetmg duly held after regular call and notice, if (a) a quorum is present at that meeting, either in person or by Proxy, and (b) either before or after the meeting, each of the persons entitled to Vote, not present in person or by Proxy, signs either a written waiver of notice, a consent to the holding ofthe meeting, or an approval of the minutes of the meeting. Attendance of a Member at a meeting shall constitute waiver of notice, unless that Member objects, at the beginning of the meeting, to the transaction of any business on tiie ground that the meeting was not lawfully called or convened. Attendance at a meeting is not a waiver of any right to object to the consideration of matters required to be described in the notice of the meeting and not so included, if the objection is expressly made at the meeting. \\Tddl\c\Clienl3 -• A\RadacMCottage Row Carlsbad LLC\Cotlage Row Carisbad Op Agt 70510.wpd -19- 7.7 At all meetings of Members, a Member may Vote in person or by Proxy. Such Proxy shall be filed with the Manager before or at the time ofthe meeting, and may be filed by facsimile transmission to the Manager at the principal executive office of the Company or such other address as may be given by the Manager to the Members for such purposes. 7.8 Members may participate in a meeting through use of conference telephone or similar communications equipment, provided that all Members participating in such meeting can hear one another. Such participation shall be deemed attendance at the meeting. 7.9 Any action that may be taken at any meeting of the Members may be taken without a meeting if a consent in writmg, setting forth the action so taken, is signed by a Majority of Members. If the Members are requested to consent to a matter without a meeting, each Member shall be given notice of the matter to be voted upon in the manner described m Section 7.4. Any action taken without a meeting shall be effective when the signature(s) of a Majority of Members have been affixed to a document setting forth the action taken unless a later or earlier effective date is specified therein. Prompt Notice of the action taken shall be given to all Members who have not consented to the action. 7.10 Except as expressly otherwise set forth herein, no Member acting solely in the capacity of a Member is an agent of the Company, nor can any Member acting solely in the capacity of a Member bind the Company or execute any instrument on behalf of the Company. Accordingly, each Member shall indemnify, defend, and save harmless each other Member and the Company from and against any and all loss, cost, expense, liabilify or damage arising from or out of any claun based upon any action by such Member in contravention of the first sentence of this Section 7.10. Each Member shall indemnify and hold harmless the Company and each of the other Members from any and all expense and liabilify resulting from or arising out of any negligence or misconduct on his or her part to the extent that the amount is not covered by the applicable insurance carried by the Company. ARTICLE VIII: TRANSFERS OF MEMBERSHIP INTERESTS 8.1 A Member may Transfer all or any portion of his Membership Interest only if each of the following conditions ("Conditions of Transfer") is satisfied: (a) the Transfer is approved in writing beforehand by a Majority of the Members; (b) the transferee delivers to the Company a written undertaking to be bound by the terms of this Agreement; (c) the Transfer will not result in the termination of the Company pursuant to IRC Section 708 or such condition is waived by all of the Members; (d) the transferor or the transferee delivers the following information to the Company: (i) the ti^sferee's taxpayer identification number; (ii) the transferee's initial tax basis in the transferred membership Interest, and (iii) such other documents or instruments as may be required by the Manager, \\Tdelt\c\Clieiiu " A\RadachVCotuge Row Carisbad LLC\Cotuge Row Carisbad Op Agt 70510.wpd -20- and (e) the transferor complies with the provisions set forth in this Article VHI. 8.2 No Member may Encumber or permit or suffer any Encumbrance of all or any part of the Member's Membership Interest in the Company unless such Encumbrance has been approved in writing by all ofthe Members. Such approval may be granted or withheld in each Member's sole and absolute discretion- Any Transfer or Encumbrance of a Membership Interest without such approval shall be void. Notwithstanding any other provision of this Agreement to the contrary, a Member who is a natural person may transfer all or any portion of his or her Membership Interest to any revocable trust created for the benefit of the Member, or any combination between or among the Member, the Member's spouse, and the Member's issue; provided that the Member retains a beneficia] interest in the tmst and all of the Voting Interest included in such Membership Interest. A Transfer of a Member's beneficial interest in such trust, or failure to retain such Voting Interest, shall be deemed a Transfer of a Membership Interest. 8.3 If any Member wishes to transfer any or all of its Membership Interest in the Company pursuant to a ''Bona Fide Offer" (as defined below) and to invoke this Section 8.3, it shall give notice of such facts to the other Members (the "Other Members") and to the Manager at least 60 days in advance of the proposed sale or Transfer, indicating the terms of the Bona Fide Offer and the identity of the offeror (the "Section 8.3 Notice"). The Other Members shall thereupon have the option in the sole and absolute discretion of each to either (a) consent to the initiating Member's sale to the offeror, (b) withhold consent to the initiating Member's proposed transfer or (c) purchase (or cause the Company to redeem) the Membership Interest proposed to be transferred at the price and on the terms provided in the Section 8.3 Notice. The failure of the Other Members to respond within thirty (30) days after receipt ofthe Section 8.3 Notice shall be deemed to constitute the consent on the part of the Other Members to the initiating Member's sale to the offeror. For purposes ofthis Agreement, "Bona Fide Offer" means an offer in writing setting forth all relevant terms and conditions of purchase from an offeror who is ready, willing, and able to consummate the purchase and who is not an Affiliate of the initiatmg Member. For 60 days after receipt of the Section 8.3 Notice, the Other Members shall have the right to purchase (or cause the Company to redeem) the Membership Interest offered, at the price and on the other terms stated in the Section 8.3 Notice. If and only if the Other Members consent to the initiating Member's sale to the offeror, then the initiating Member may, within 120 days from the Other Members's receipt ofthe Section 8.3 Notice and on the terms and conditions stated in tiie Section 8.3 Notice, sell or exchange its Membership Interest to the offeror named in the Section 8.3 Notice. 8.4 On the happening of any of the following events ("Triggering Events") with respect to a Member, the Company and the other Members shall have the option, but not the obligation, to purchase the Membership Interest in the Company of such Member ("Selling Member") at the price and on the terms provided in Section 8.8 of this Agreement: (a) The occurrence of any other event that is, or that would cause, a Transfer in contravention of this Agreement. Each Member agrees to promptly give Notice of a Triggering Event to the Manager and all other Members. 8.5 [Reserved.] 8.6 On the receipt of Notice by the Manager and the other Members as contemplated by Sections 8.1, 8.3, and 8.5, and on receipt of actual notice of any Triggering Event as determined in good faith by the WTdellWVCIienti - A\Radach\Cotuge Row Carisbad LLC\Cotuge Row Carisbad Op Agt 70510.wpd -21- Manager, the Company shall have the option, for a period ending 30 calendar days following the determination ofthe purchase price as provided m Section 8.8, to purchase the Membership Interest in the Company to which the option relates, at the price and on the terms set forth in Section 8.8 of this Agreement, and the other Members, pro rata in accordance with their prior Membership Interests in the Company, shall then have the option, for a period of 60 days thereafter, to purchase the Membership Interest in the Company not purchased by the Company, on the same terms and conditions as apply to the Company. If all other Members do not elect to purchase the entire remaining Membership Interest in the Company, then the Members electing to purchase shall have the right, pro rata in accordance with their prior Membership Interest in the Company, to purchase the additional Membership Interest in the Company available for purchase. The transferee of the Membership Interest in the Company that is not purchased shall hold such Membership Interest in the Company subject to all of the provisions of this Agreement. 8.7 Neither the Member whose interest is subject to purchase under this Article, nor such Member's Affiliate, shall participate in any Vote or discussion of any matter pertaining to the disposition of the Member's Membership Interest in the Company under this Agreement. 8.8 The purchase price of the Membership Interest tfaat is the subject of an option under Section 8.6 shall be the "Fair Market Value" of the interest as determined under this Section 8.8. "Fair Market Value" means the cash price that a willing buyer would pay to a willing seller when neither is acting under compulsion and when both have reasonable knowledge of the relevant facts on the date the option is first exercisable (the "Option Date"). Each of the selling and purchasing parties shall use his, her, or its best efforts to mutually agree upon the Fair Market Value. If the parties are unable to so agree within 30 days of the Option Date, the selling party shall appoint, within 40 days ofthe Option Date, one appraiser, and the purchasing party shall appoint within 40 days of the Option Date, one appraiser. The two appraisers shall within a period of five additional days, agree upon and appoint an additional appraiser. The three ^praisers shall, within 60 days after the appointment of the third appraiser, determine the Fair Market VaJue of the Membership Interest in writing and submit their report to all the parties. The Fair Market Value shall be determined by disregarding the appraiser's valuation that diverges the greatest from each of the other two appraisers' valuations, and the arithmetic mean of the remaining two appraisers' valuations shall be the Fair Maricet Value. Each purchasing party shall pay for the services of the appraiser selected by it, plus one half of the fee charged by the third appraiser, and one half of all other costs relating to the detennination of Fair Market Value. The option purcluise price as so determined shall be payable in cash. 8.9 Except as expressly permitted under Section 8.2, a prospective transferee (other than an existing Member) of a Membership Interest may be admitted as a Member with respect to such Membership Interest ("Substituted Member") only (a) on the unanimous Vote of the other Members in favor of the prospective transferee's admission as a Member and (b) on such prospective transferee's executing a counterpart of this Agreement as a parfy hereto. Any prospective transferee of a Membership Interest shall be deemed an Assignee, and, therefore, the owner of only an Economic Interest until such prospective transferee has been admitted as a Substituted Member. Except as otherwise pennitted in the Act, any such Assignee shall be entitled only to receive allocations and distributions under this Agreement with respect to such Membership Interest and shall have no right to Vote or exercise any rights of a Member until such Assignee has been admitted as a Substituted Member. Until the Assignee becomes a Substituted Member, the Assigning Member will contmue to be a Member and to have the power to exercise any rights and powers of a Member under this Agreement, including the right to Vote in proportion to the Percentage Interest that the Assigning Member would have had in the event that the assignment had not been made. 8.10 Any person admitted to the Company as a Substituted Member shall be subject to all the provisions of this Agreement that apply to the Member from whom the Membership Interest was assigned, provided. \\Tdell\c\Clieiils -- A\Kadach\Cotuge Row Caritbad LLC\Coltage Row Carisbad Op Agt 70510.wpd -22- however, that the assigning Member shall not be released from liabilities as a Member solely as a resuh of the assignment, both with respect to obligations to the Company and to third parties, incurred prior to the assignment. 8.11 The initial sale of Membership Interests in the Company to the Initial Members has not been qualified or registered under the securities laws of any state, including California, or registered under the Securities Act of 1933, in reliance upon exemptions from the registration provisions of those laws. Notwithstanding any other provision of tiiis Agreement, Membership Interests may not be Transferred unless registered or qualified under applicable state and federal securities law unless, in die opinion of legal counsel satisfactory to the Company, such qualification or registration is not required. The Member who desires to transfer a Membership Interest shall be responsible for all legal fees incurred in connection with said opinion. 8.12 A Member may not withdraw from the Coinpany without the written consents of all remaining Members. Withdrawal shall not release a Member from any obligations and liabilities under this Agreement accmed or incurred prior to the effective date of withdrawal. A withdrawing Member shall have only the rights of a holder of an Economic Interest in the Company in respect of the Member's Membership Interest in the Company. Unless all remaining Members consent to such withdrawal, the withdrawing member shall not be entitled to a disfribution of its Economic Interest until the dissolution and liquidation of the Company. For purposes of this Section 8.12, the term "Economic Interest" shall not mean or include any right to share in the income, gains, losses, deductions, credits, or similar items of the Company attributable to any period following withdrawal, or any right to information conceming the business and affairs of the Company, except as provided m Corporations Code Section 17106. 8.13 Any time after the date which is three (3) years after the date of this Agreement, a Member may cause the complete redemption or sale of his/her/its Membership Interest as follows: (a) Any Member (the "Offeror") shall be entitled to deliver to all of the other Members ("Offerees") a written offer (the "Offer") requiring Offerees eitiier (i) to sell all of their Membership Interests in the Company to Offeror or (ii) to purchase all of Offeror's Membership Interests in the Company. The Offeror shall state his or her belief as to the value of the Company as of the date of the Offer (the "Offer Value"). The terms and conditions of such purchase or sale shall be set forth in detail in the Offer and shall be identical with respect to such purchase or sale except that the purchase price of the Membership Interests being sold pursuant to the provisions of this Section 8.13 shall be based on the Offer Value multiplied by a fracrtion, the numerator of which equals the Percentage Interest of the Company being sold by the selling Member(s) and the denominator of which equals 100% (the "Selling Price"). Any Offer shall be irrevocable for a period of forty-five (45) days. Within thirty (30) days after receipt of the Offer, Offerees shall notify Offeror in writmg of their election to buy all of Offeror's Membership Interest in the Company or to sell all of Offerees' Membership Interest in the Company, as the case may be, in accordance with the Offer. Failure of any Offeree to deliver such written notice within such thirty-day period shall constitute that Offeree's election to sell all of his or her Membership Interests in the Company to Offeror. (b) Offerees' response referred to in Section 8.13(a), above, shall be determined on the basis of Majorify Vote, based on the Percentage Interest owned by each Member Offeree, and any such vote shall be binding upon all Offerees. Notwithstanding the foregoing, in the case of a non-unanimous decision by Offerees, a dissenting Offeree shall n&L be required either to purchase or to sell Membership Interests pursuant to the applicable Offer, and such Membership Interests shall be sold or purchased by the non-dissenting Offerees, pro rata in accordance with the number of Membership Interests owned by WTdellXcVCIients - AVRadachVCotUge Row Carisbad LLC\Cottago Row Caritbad Op Agt 70510.wpd -23- tiiem immediately prior to the receipt of the Offer. Notwithstanding the foregoing, in the case of a non- unanimous decision by Offerees pursuant to which the owner(s) of the Membership Interest not owned by Offeror elect to sell and the owner(s) of the other Percentage Interest elect to purchase, the Offerees who initially elected to purchase pursuant to Section 8.13(a) shall do so pro rata in accordance with the Percentage Interest owned by him, her or them immediately prior to the receipt of the Offer and Offeror shall not be required to purchase any Membership Interests from any Offeree(s) who initially elected to sell pursuant to Section 8.13(a), above. (c) The Sales Price payable to the selling Member pursuant to this Section 8.13 shall be paid as follows: a minimum down payment equal to 100% of the total Sales Price. (d) Within ten (10) days after the Offeror's receipt of Offerees' notice of their election to buy or sell, as the case may be, an escrow to consummate the purchase and sale transaction contemplated by this Section 8.13 shall be opened by the Members with an escrow holder designated by the purchasing Member(s). Such escrow shall be (i) handled consistent with the provisions of this Section 8.13, (ii) provide for closing on (or at the purchasing Shareholder's election, before) ninefy (90) days after opening of escrow, (iii) incorporate the terms and conditions set forth in the Offer, and (iv) allocate escrow and other charges and expenses according to local custom. (e) If the down payment referred to in Section 8.13(c), above, is less than the total Sales Price, the purchaser shall pay the balance thereof in sixty (60) consecutive monthly payments beginning three months after the down payment. Simple interest will be charged on the outstanding prmcipal and interest balance at the annual rate of the prime rate listed by Wells Fai^o Bank (or its successor) as of the date of the down payment is made ("Prime Rate"). The unpaid balance of the Sales Price shall be evidenced by a negotiable promissory note the repayment of which shall be secured by a security interest m the Membership Interests being acquired (the "Redemption Note"). The Redemption Note shdl provide that in the event of defauh in payment of principal, the Redemption Note will become due and payable immediately. The purchaser may prepay the Redemption Note in whole or in part at any time without penalty. 8.14 No assignment, or any part thereof, that is in violation of this Article VIII shall be valid or effective, and neither the Company nor the Members shall recognize the same for the purpose of making distributions. Neither the Company nor the non-assigning Members shall incur any liability as a result of refiising to make any such distributions to the assignee of any such invalid assignment. In tfae case of an assignment or attempted assignment of an interest in the Company that has not received the consents required by this Agreement, or in the case of an assignment permitted by this Article VIA, the parties engaging or attempting to engage in such assignment shall be liable to indemnify and hold harmless the Company and the other Members from all costs, liabilities and damages that any of such indemnified Persons may incur (including incremental tax liabilify and lawyers' fees and expenses) as a result of such assignment or attempted assignment and efforts to enforce the indemnity granted hereby. 8.15 If one or more Members owning in the aggregate a Majority Interest reach(s) an agreement to sell a Majority Interest or more to a third party which selling Members otherwise comply with the provisions of this Article VIII, such seUing Members shall not be permitted to complete such a Transfer unless each Member not initially obtaining authorization to sell is provided the contemporaneous opportunity to sell his or her Membership Interest to the same buyer and on the same terms and conditions (but allowing for customary minority discounting, if applicable) as the other selling Members. \\Tdall\c\Clieiiu - A\Radach\Cotugt Row Caritbad LLCVCotuge Row Caritbad Op Agt 70510.wpd -24- ARTICLE IX: DISSOLUTION AND WINDING UP 9.1 The Company shall be dissolved upon the first to occur of the following events: (a) The death, incapacity, bankmptcy, withdrawal, or dissolution of a Member, provided, however, tfaat the remaining Member(s) may within 90 days of the happening of that event Vote to continue the business of the Company, m which case, the Company shall not dissolve. If the remainmg Member(s) fail to so Vote, the remaining Member(s) shall wind up the Company. (b) The expiration of the term of existence of the Company which term of existence shall expire as of 11:59 p.m., PST on DECEMBER 31,2040. (c) The written agreement of the Members to dissolve the Company. (d) The sale or other disposition of all or substantially all of the Company's assets. (e) Entry of a decree of judicial dissolution under Corp C Section 17351. 9.2 On the dissolution of the Company, the Company shall engage in no further business other than that necessaiy to wind up the business and affairs of the Company. The Members, shall wind up the affairs of the Company. The Persons winding up the affairs of the Company shall give Notice of the commencement of winding up by mail to all known creditors and claimants against the Company whose addresses appear in the records of the Company. After paying or adequately providing for the payment of all known debts of the Company, the remaining assets of the Company shall be distributed or applied in the following order: (a) To pay the expenses of liquidation; then (b) To the establishment of reasonable reserves by the Manager for contingent liabilities or obligations of the Company. Upon the Manager's determination that such reserves are no longer necessaty, said reserves shall be distributed as provided in this Section 9.2; then (c) To repay outstanding loans to Members. If there are insufficient fiinds to pay sucfa loans in full, each Member shall be repaid in the ratio that the Member's loan, together with interest accrued and unpaid thereon, bears to the total of all such loans from Members, mcluding all interest accmed and unpaid thereon. Such repayment shall first be credited to accmed and unpaid interest due and tfae remainder shall be credited to principal; then (d) To the Members in accordance with Section 4.14. 9.3 Each Member shall look solely to the assets of the Company for the return of the Member's investment, and if the Company property remaining after the payment or discharge ofthe debts and liabilities of the Company is insufficient to retum the investment of each Member, such Member sfaall faave no recourse against any otfaer Members for indemnification, contribution, or reimbursement, except as specifically provided in this Agreement. \\Tdell\c\ClienU ~ A\Radach\Cottage Row Carisbad LLCVCotuge Row Carisbad Op Agt 705IO.wpd -25- ARTICLE X: FIDUCIARY DUTIES 10.1 The only fiduciary duties a Manager owes to the Company and the Members are the duty of loyalty and the duty of care, as set forth below: (1) A Manager's duty of loyalty to the Company and the Members is limited to the followmg: (a) To account to the Company and hold as trustee for it any properfy, profit, or benefit derived by the Manager in the conduct or winding up of the Company's business or derived from a use by the Manager of Company property, including the appropriation of a Company opportunity, without the consent of the Members; and (b) To refiain from dealing with the Company in the conduct or winding up of the Company business as or dn behalf of a party having an interest adverse to tfae Company witiiout the consent of the Members. (2) A Manager's duty of care to the Company and the Members in the conduct and winding up of the Company business is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law. 10.2 Members who are not a Manager do not have, and shall not be deemed to have, fiduciary duties to the Company or the other Members except to the extent any such fiduciaty duty shall be based upon or arise out of another relationship or contract between such member and the person or entity asserting the existence of a fiduciaiy duty. ARTICLE XI: INDEMNIFICATION 11.1 The Company, its receiver or its tmstee, shall to the maximum extent permitted by the Act, indemnify, save hannless and pay all judgments and claims agauist the Manager, the Members and tfae officers of the Company, and their respective members, officers, directors, shareholders, employees, agents. Affiliates and assigns (all such indemnified persons being included in the term "Manager" for purposes of this Article XI), from any liability, loss or damage incurred by them or by the Company or the Members by reason of any act performed or omitted to be performed by them in connection with any proceeding arising out of or related to the business ofthe Company, including costs and attorneys' fees (which attorneys' fees may be paid as incurred) and any amounts expended in the settlements or any claims of liability, loss or damage; provided, however, that if the liability, loss or claim arises out of any action or inaction of the Manager: (i) the Manager must have determined, in good faith, that its course of conduct was in the best interests of the Company; and (ii) the action or inaction did not constitute fraud, breach of fiduciaty duty or gross negligence or gross misconduct by the Manager; and provided further, however, that the indemnification shall be recoverable only from the assets of the Company and not any other assets of the \\Tdell\c\Clieiits - A\Radach\CotUge Row Carisbad LLC\Cottage Row Caritbad Op Agt 70510 wpd -26- Members. All judgments against the Company and any Manager, against which tfae Manager is entitied to indemnification, must first be satisfied &om Company assets before the Manager is responsible. The Company shall not pay for any insurance covering liability of the Mani^er for actions or omissions for which indemnification is not permitted hereunder. The Company may, however, purchase and pay for that insurance, including extended coverage liability and casualty and worker's compensation, as would be customaty for any person owning comparable property and engaging in a similar business, and name tfae Manager and any of its Affiliates as additional insured parties, provided that the addition does not increase the premium cost to the Company. This Article shall not constitute a waiver by any Member of any right which he may have against any party under federal or state securities laws. The Company shall have tfae authorify, to the maximum extent permitted by the Act, to advance expenses incurred by any Manager in defending any proceeding. The Company sfaall faave the power to enter into binding agreements with the Manager to provide the indemnification allowed under this Article. 11.2 Notwithstanding tfae provisions of Section 11.1 hereof^ no Manager shall be indemnified fix)m any liability, loss, or damage incurred in connection with any claim or settlement involving allegations that the Securities Act of 1933 or tfae Califomia Corporate Securities Law of 1968 were violated by tfae Manager unless: (a) The Manager is successfiil in defending the action; (b) The indemnification is specifically approved by a court of law which shall have been advised as to the current position of the Securities and Exchange Conimission (as to any claim involving allegations that the Securities Act of 1933 was violated) or the Califomia Department of Corporations (as to any claim involving allegations that the California Corporate Securities Law of 1968 was violated); or (c) In the opinion of counsel for the Company, tfae right to indemnification has been settled by controlling precedent. ARTICLE XII: NON-COMPETITION AND CONFIDENTIALITY 12.1 Each Member hereby covenants witfa the Company and each otfaer Member tfaat on tfae Transfer of the Member's Membership Interest, whether voluntaty, involuntaty, by operation of law, or by reason of any provision of this Agreement, the Member will not, directly or indirectly, through an Affiliate or otherwise, for a period of twenty-four (24) months following the date of the Transfer, (a) enter into any agreement or understanding, written or oral, relating to tfae services of any employee of the Company, (b) solicit tfae business of, enter into any agreement, written or oral, or otherwise deal with any clients or customers of the Company, who were such at the time of the Transfer, (c) use or disclose in any manner any Confidential Information, or (d) directly or indirectly compete with tfae Company within a 25 mile radius of Carlsbad, San Diego County. 12.2 "Confidential Infonnation" means all trade secrets, "know-how," customer lists, pricing policies, operational methods, programs, and other business mformation of the Company created, developed, produced, or otherwise arising before tfae date of tfae Transfer. \VTdell\c\Clienu - A\Radach\Cottage Row Carisbad LLCVCotuge Row Carisbad Op Agt 70510 wpd -27- 12.3 Each Member hereby stipulates that a breach of the provisions of this Article XII will result in irreparable damage and injuty to the Company for wfaicfa no money damages could adequately compensate it. If tfae Member breaches the provisions of this Agreement, in addition to all otfaer remedies to which the Company may be entitled, and notwithstanding any contraty provisions of this Agreement, the Company sfaall be entitled to an injunction to enforce the provisions of this Agreement, to be issued by any court of competent jurisdiction, to enjoin and restrain tfae Member and eacfa and evety Person concemed or acting in concert witfa the Member from tfae continuance of sucfa breacfa. Each Member expressly waives any claim or defense that an adequate reme(fy at law might exist for any such breach. 12.4 If the provisions contained herein shall be deemed to exceed the time or geographic limits or any other limitation imposed by applicable law m any jurisdiction, then such provision shall be deemed reformed in such jurisdiction to tfae maximum extent required and pennitted by applicable law and sfaall otherwise remain in fiill force and effect. ARTICLE XIII: GENERAL PROVISIONS 13.1 This Agreement, together with the document(s) mentioned therein or herein, constitute the whole and entire agreement of the parties with respect to the subject matter of this Agreement as of tfae date first above written, and it shall not be modified or amended in any respect except by a written instmment executed by a Majority of Members. This Agreement the document(s) mentioned herein, replaces and supersedes all prior written and oral agreements by and among the Members and Manager or any of them. 13.2 This Agreement may be executed in one or more counter parts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 13.3 This Agreement shall be constmed and enforced in accordance with the internal laws ofthe State of Califomia. If any provision of this Agreement is determined by any court of competent jurisdiction or arbitrator to be invalid, illegal, or unenforceable to any extent, that provision sfaall, if possible, be constmed as though more narrowly drawn, if a narrower constmction would avoid such invalidity, illegality, or un- enforceability or, if that is not possible, such provision shall, to the extent of such invalidity, illegality, or un-enforceability, be severed, and the remaining provisions of this Agreement shall remain in effect. 13.4 This Agreement shall be binding on and inure to the benefit of the parties and their heirs, personal representatives, and permitted successors and assigns. 13.5 Whenever used in this Agreement, the singular shall include the plural and the plural shall include the singular, and the neuter gender shall include the male and female as well as a trust, firm, company, or corporation, all as the context and meaning of this Agreement may require. 13.6 The parties to this Agreement shall promptly execute and deliver any and all additional documents, instruments, notices, and otfaer assurances, and shall do any and all other acts and things, reasonably necessaty in connection with tfae performance of their respective obligations under this Agreement and to cany out the intent of the parties. \\Tdell\c\Clieiits - AVRadacbVCotUgc Row Carisbad LLCVCottage Row Carisbad Op Agt 705ia.wpd -28- 13.7 Except as provided in this Agreement, no provision of this Agreement shall be constmed to limit in any manner the Members in the carrying on of their own respective businesses or activities. 13.8 Except as provided in this Agreement, no provision ofthis Agreement shall be constmed to constitute a Member, in tfae Member's capacify as such, the agent of any other Member. 13.9 Each Member represents and warrants to the other Members that the Member has the capacify and authority to enter into this Agreement. 13.10 The article, section, and paragraph titles and headings contained in this Agreement are inserted as a matter of convenience and for ease of reference only and shall be disregarded for all other purposes, mcluding the construction or enforcement of this Agreement or any of its provisions. 13.11 Time is of the essence of evety provision of this Agreement tfaat specifies a time for performance. 13.12 This Agreement is made solely for the benefit ofthe parties to this Agreement and their respective permitted successors and assigns, and no other person or entity shall have or acquire any right by virtue of this Agreement. 13.13 The Company has initially selected Wayne A. Ybarra of Ybarra & Associates ("Company Counsel"), as legal counsel to the Company to, among other things, prepare this Agreement. Accordingly, it is appropriate for Company Counsel to disclose certain information to the Members relating to actual or potential conflicts of interest and other issues relating to such representation. First, Mr. Ybarra has in the past represented, and currently represents, Russel Raxlach and The Radach Family Trust and other entities in which Mr. Radach has or had an interest (collectively, "Radach Entities"). By executing a copy of tills Agreement, each Member acknowledges that (i) Company Counsel docs not represent any individual Member in the absence of a clear and explicit written agreement to such effect between the Member and Company Counsel, (ii) Company Counsel is not presently representing any individual Member of the Company in connection with this Agreement or the subject matter herein, (iii) if a dispute arises between a Radach Entity (or an Affiliate), on the one hand, and another Member of the Company or the Company itself, on the other hand. Company Counsel may represent tfae Radach Entity (or an Affiliate) in any such controversy or dispute, but only if and to the extent permitted by tfae Rules of Professional Conduct applicable to Califomia attomeys, (iv) it has, to the extent deemed necessary by such Member, consulted with independent legal counsel with respect to this Agreement, in particular this Section 13.13. and (v) it consents to the representation of the Company by Company Counsel. 13.14 All notices and demands by one parfy to another shall be made in accordance with Section 1.35 addressed as follows: If to Radach: THE RADACH FAMILY TRUST U/D/T JULY 7, 2001 c/o Mr. Russel Radach 451 HawtiiomeRd. Laguna Beach, CA 92651 Telephone: 949-351 -4890 russelradach(S^cox.net \\Tdall\c\Clisiits -• A\Radach\Coltagi Row Caritbad LLCVColugi Row Carllbad Op Agt 705IO.wpd -29- If to Harron/Gorski: THE HARRON/GORSKI FAMILY TRUST U/D/T MAY 21,2000 c/o Ms. Judith A. Gorski 449 Blumont Street Laguna Beach, CA 92651 Telephone: 949-494^378 iudigorski(5^verizon.net rodharron(5),verizon.net If to the Company: COTTAGE ROW CARLSBAD LLC c/o Mr. Russel Radach 451 HawtiiomeRd. Laguna Beach, CA 92651 Telephone: 949-351-4890 russelradach(@cox.net Any parfy may, from time to time by notice in writing served upon the other parfy as aforesaid, designate a different mailing address or different or additional persons to which all such notices or demands are thereafter to be addressed. 13.16 If the Manager or a Member is required by the provisions of this Agreement to obtain the consent or approval of another party to this Agreement with respect to any matter (including without limitation matters requiring the consent or approval of a Majority of Members), the party seeking to obtain such consent sfaall do so in a writing (the "Request Notice") in accordance with Sections 1.35 and 13.15, above. The party receiving such Request Notice shall be deemed to have consented to or faave approved of tfae matters set fortfa in such Request Notice if the party originating the Request Notice has not received a written response thereto within ten (10) days after the Request Notice is deemed "given" by the requesting party pursuant to Section 1.35. ARTICLE XIV: SPECIAL PROVISIONS 14.1 Purchase of Real Property in Carlsbad. Califomia. The Company was formed for tfae express purposes of acquiring, developing, managing and selling certain real property in Carlsbad, Califomia (APN 212-040-47-00) (the "Property"). Radach, as part of its Initial Coital Contiibution shall cause Russel R. Radach to assign all of his right, title and mterest in and to (i) that certain Residential Income Property Purchase Agreement and Joint Escrow Instmctions, dated August 14, 2006 (the "Purchase Agreement"), and (ii) tiiat certain $500,000.00 deposit (the "Deposit") being held by Chicago Title ("Escrow Holder") in connection witii Escrow #608522384-S43 (tiie "Escrow"), to the Company forthwith. \\Tdell\<:\CIi<nts -- A\RadacliVCottage Row Caritbad LLC\Cottag< Row Caritbad Op Agt 70510.wpd -30- The Members hereby specifically authorize Russel R. Radach, acting alone in his capacify of President and Assistant Secretaty of the Company to execute and deliver on behalf of the Company any and all documents and instmments necessary or useful in acquiring the Property and/or relating to the Purchase Agreement, the Deposit, Escrow Holder or the Property (induing without limitation, the closing statement, amendments to tfae Escrow Agreement and instmctions to Escrow Holder). 14.2 Establishment of Company Bank Account(s). Tfae Members hereby specifically authorize and direct the officers of the Company to open and operate one or more bank accounts at the Laguna Beach, Califomia branch of Bank of America and/or Wells Fargo Bank. Each of said institutions is faereby designated as a depositoty for Company fiinds which may be withdrawn on checks, drafts, advices of debt, notes or other orders for the payment of monies signed by one of the authorized individuals named in the following sentence. Tfae Members hereby also specifically authorize and direct that Russel R. Radach and Judith A. Gorski shall both be authorized signers on said accounts and that eitfaer (1) Russel R. Radacfa, acting alone, or (2) Judith A. Gorski, acting alone, or (3) Roderick H. Harron, acting alone, is authorized to sign, endorse, execute and deliver on behalf of the Company any and all documents and instruments necessaty or useful in depositing and withdrawmg Company funds into and out of said account(s). IN WITNESS WHEREOF, the parties have executed or caused to be executed this Agreement as of the day and year first above written. "Members" THE RADACH FAMILY TRUST U/D/T JULY 7,2001 Russel R. Radach, Co-Tmstee / Sonja Radach-Siegenthaler, Co-Tr](fctee THE HARRON/GORSKI FAMILY TRUST U/D/T 21,2000. Roderick H. Hanon, Co-Tmstee «Tdell\c\Clieiiti -- A«ladach\Cottage Row Carisbad LLCVCottage Row Carisbad Op Agt 7031C.wpd -31- FIRST AMENDMENT TO OPERATING AGREEMENT OF COTTAGE ROW CARLSBAD LLC THIS FIRST AMENDMENT TO OPERATING AGREEMENT (tiiis "Ameadmcnt") is dated for reference purposes as of NOVEMBER 25,2009, by, between and among: COTTAGE ROW CARLSBAD LLC, a Califomia limited liability company (the "Company"); RODERICK H. HARRON, TRUSTEE of the Roderick H. Harron Trust U/D/T May 26, 2009 ("Harron"); JUDITH A. GORSKI, a single woman ("Gorsld"); RUSSEL R. RADACH and SONJA RADACH-SIEGENTHALER, CO-TRUSTEES of The Radach Famify Tmst U/D/T July 7,2001 ("Radach"); and RODERICK H. HARRON and JUDITH A. GORSKI, CO-TRUSTEES of The Harron/Gorski Family Tmst U/D/T May 21,2000 ("HarroD/Gonki"). Radach and Harron/Gorski are sometimes collectively refened to as the "Original Members" and mdividually as an "Original Member." RECITALS A. On or about MAY 8,2007, the Original Members formed tiie Company under and pursuant to the Beverly-Killea Limited Liability Company Act. Thereafter the Original Members executed tiiat certain Operating Agreement of COTTAGE ROW CARLSBAD LLC dated MAY JO, 2007 (tiie "Originai Operating Agreement"). B. Pursuant to this Amendment, Harron shall become a Member of the Company as of May 26, 2009 (the "Effective Date"), pursuant to a court-ordered dissolution of marriage and division of assets. NOW, THEREFORE, tiie parties hereby agree as follows. 1. Aasignment of Capital and Profit Interest, Effective as of tiie Effective Date, RODERICK H. HARRON and JUDITH A. GORSKI, CO-TRUSTEES of The Hanxin/Gorski Family Tmst U/D/T May 21, 2000, hereby assign to Harron all of tiieir rigjit, title and mterest in and to the Con^y (including without limitation, their Percentage Interest, Capital Account and right to Profits) and Harron accepts such assignment. 2. Allocatioas and Dtetributioiis. Article 4.1 of tiie Amended and Restated Opoating Agreement is hereby modified by deleting it in its entirety and substituting therefor tiie foUovyring: "4.1 (a) The Profits and Losses ofthe Company and, except as otiierwise set forth in this Agreement, all items of Company income, gain, loss, deduction, or credit shall be allocated, as follows: Percentage Interest Name Profits Losses Radach 75.00% 75.00% Harron/Gorski 25.00% 25.00% TOTALS 100.00% 100.00% -1- "(b) Effective as of MAY 26, 2009, and at all times thereafter, the Profits and Losses ofthe Company (except as otherwise spedfically set forth in this Agreement) and all items of Company income, gain, loss, deduction, or credit shall be allocated, as follows: Percentage Interest Name Profits Losses Radach 75.00% 75.00% Harron 25.00% 25.00% TOTALS 100.00% 100.00%'* 3. Notices. Article 13.15 of the Amended and Restated Operating Agreement is hereby modified by addii^ the following at the end thereof: "If to Harron: Mr. Rodmck Harron PO Box 2194 Newport Beach, CA 92659 Telephone: 949-228-0176 Email: roderickhanon(aigmail.com" 4. New Member to bc Bound by the Original Operatiag Agreement Harron agrees to be bound by each and evety provision of the Original Operating Agreement (which is hereby incorporated herein by this reference), as modified by this Amencbnent. 5. Original Qperattn^ Agreement to Remain in Effect. Except as modified by this Amendment, the Original Operating Agreement shall remain in full force and effect. 6. Consenting Parties. Execution ofthis Amencbnent by each ofRadach,Harron/Gorsid and Gorski indicate his/her/its consent to tiiis Amendment, including witfaout limitation the admittance of Harron as a Substitute Member and tfae assignment described in Paragraf^ 1, above. IN WITNESS WHEREOF, the parties have executed or caused to be executed this Agreement on the day and year first above written. "Company** COTTAGE ROW CARLSBAD LLC a Califomia limited iiabiiity company By: THE RADACH FAMILY TRUST U/D/T JVLY^ 2001, Membeix:?^ By: Byr Sonja Ri^dach-Siegei (Sigaatura contiiiaed oa ucxt page] Russel Rs Radach, Co-Trusty j r~^^ H J) f) Sonja R»dach-Siegenthaler,"t;o-Trustee \ j "Original Members** THE RADACH FAMILY TRUST U/D/T JULY 7,2001 THE HARRON/GORSia FAMILV TRUST U/D/T MAY>21,2000 . By: K^c/AA^.J<Jil^aJ^ 9kL Roderick H. Harron, Co-Trustee By: ^ ^Judith A. Gorski, Co-Trustee "Gorski" a. JUDFTH A. GORSKI "Harron** THE RODERICK H. HARRON TRUST U/IVr MA^O6,2009 By: Roderick H. Harron, Tmstee F:VCIteiitg-RlC-DVCott«ge Row Cartsbad LLOOfg DoMtfirst Amendment to Origina) Operating AgmnxM 91229. wpd -3- Chicago Title Company 11870 Pierce Street #100 Riverside, CA 92505 (951) 710-5800 Title Department; Escrow Department: Chicago Title Company Cottage Row Carlsbad LLC Attn: Kelly McDole P.O. Box 2194 Email: McDoleK@CTT.com Newport Beach, Califomia 92659 Phone: (909)381-6751 Attn: Jocelyn Bruce Fax: (909)384-7981 Phone:(714)403-0773 Order No.: 127400339-K26 Email: BruceJocelvn426@gmail.com AMENDED PRELIMINARY REPORT Property Address: Sweet Briar Circle, Carlsbad CA Dated as of: May 9, 2012 at 7:30 am In response to the application for a policy of title insurance referenced herein, Chicago Title Company hereby reports that it is prepared to issue, or cause to be issued, as of the date hereof, a policy or policies of Title Insurance describing the land and the estate or interest therein hereinafter set forth, insuring against loss which may be sustained by reason of any defect, lien or encumbrance not shown or referred to as an Exception herein or not excluded from coverage pursuant to the printed Schedules, Conditions and Stipulations or Conditions of said Policy forms. The printed Exceptions and Exclusion from the coverage and Limitations on Covered Risks of said Policy or Policies are set forth in Attachment One. The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less than that set forth in the arbitration clause, all arbitrable matters shall be arbitrated at the option of either the Company or the Insured as the exclusive remedy of the parties. Limitations on Covered Risks applicable to the CLTA and ALTA Homeowner's Policies of Title Insurance which establish a Deductible Amount and a Maximum Dollar Limit of Liability for certain coverages are also set forth in Attachment One. Copies of the policy forms should be read. They are available from the office which issued this report. This report (and any supplements or amendments hereto) is issued solely for the purpose of facilitating the issuance of a policy of title insurance and no liability is assumed hereby. If it is desired that liability be assumed prior to the issuance of a policy of title insurance, a Binder or Commitment should be requested. The policy(s) of title insurance to be issued hereunder will be policy(s) of Chicago Title Insurance Company Please read the exceptions shown or referred to herein and the exceptions and exclusions set forth in Attachment One of this report carefully. The exceptions and exclusions are meant to provide you with notice of matters which are not covered under the terms of the title insurance policy and should be carefully considered. It is important to note that this preUminary report is not a written representation as to the condition of title and may not list all liens, defects, and encumbrances affecting title to the land, CALIFORNIA LAND TITLE ASSOCIATION STANDARD COVERAGE POLICY CLTA Preliminary Report Form - Modified (11-17-06) Page 1 ^ ^ Order No.: 127400339-K26 SCHEDULE A 1. The estate or interest in the land hereinafter described or referred to covered by this report is: A Fee 2. Title to said estate or interest at the date hereof is vested in: Cottage Row Carlsbad LLC, a Califomia limited liability company 3. The land referred to in this report is situated in the State of Califomia, County of San Diego and is described in the Legal Description, attached hereto: END OF SCHEDULE A CLTA Preliminary Report Form - Modified (11-17-06) Page 2 Order No.: 127400339-K26 LEGAL DESCRIPTION PARCEL A: LOT 135 OF CITY OF CARLSBAD TRACT 97-14. UNIT NO. 1, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 13840, FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, SEPTEMBER 1, 1999, AND AS CORRECTED BY A "CERTIFICATE OF CORRECTION" RECORDED MAY 12, 2004 AS INSTRUMENT NO. 2004-0431259 OF OFFICIAL RECORDS. PARCELB: A PORTION OF THE LAND DESIGNATED AS "DESCRIPTION NO. 4, 76.89 ACRES" AS SHOWN AND DELINEATED ON RECORD OF SURVEY NO. 5715. FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN DIEGO COUNTY, DECEMBER 19, 1960, ALSO BEING A PORTION OF LOT "G" OF THE RANCHO AGUA HEDIONDA, IN THE CITY OF CARLSBAD, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA, ACCORDING TO MAP THEREOF NO. 823. FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAID SAN DIEGO COUNTY, NOVEMBER 16, 1986, SAID PARCEL BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF SAID "DESCRIPTION NO. 4, 76.89 ACRES"; THENCE ALONG THE WESTERLY LINE OF SAID PARCEL, SOUTH 09° 58' 17" EAST 680.09 FEET TO A LINE PARALLEL WITH AND 80.00 FEET SOUTHERLY OF THE SOUTHERLY LINE OF THAT CERTAIN PARCEL OF LAND DESCRIBED AS PARCEL 1 IN A DEED RECORDED JUNE 20, 1978 AS INSTRUMENT NO. 78-254337. OF OFFICIAL RECORDS; THENCE LEAVING SAID WESTERLY LINE AND FOLLOWING ALONG SAID PARALLEL LINE, NORTH 77° 22' 52" EAST 868.50 FEET; THENCE NORTH 38° 40' 06" WEST 41.36 FEET TO THE BEGINNING OF A TANGENT CURVE, CONCAVE NORTHEASTERLY, THE RADIUS POINT OF SAID CURVE BEARS NORTH 51° 19' 54" EAST 1451.00 FEET; THENCE ALONG SAID CURVE 732.93 FEET THROUGH A CENTRAL ANGLE OF 28° 56' 29" TO A POINT ON THE NORTH LINE OF SAID "DESCRIPTION NO. 4", DISTANT NORTH 71° 35' 51" EAST 676.82 FEET FROM THE AFOREMENTIONED NORTHWEST CORNER; THENCE ALONG SAID NORTH LINE, SOUTH 71° 35' 51" WEST 676.82 FEET TO THE NORTHWEST CORNER OF SAID "DESCRIPTION NO. 4" AND THE POINT OF BEGINNING. SAID LAND IS DESCRIBED AND SHOWN AS PARCEL 1 ON EXHIBITS "A" AND "B" ATTACHED TO THAT CERTIFICATE OF COMPLIANCE WITH CONDITIONS RECORDED APRIL 12, 1989 AS INSTRUMENT NO. 89-191109. OFFICIAL RECORDS OF SAID COUNTY. END OF LEGAL DESCRIPTION CLTA Preliminary Report Form - Modified (11-17-06) Page 3 Order No.: 127400339-K26 SCHEDULE B At the date hereof, items to be considered and exceptions to coverage in addition to the printed Exceptions and Exclusions in said policy form would be as follows: A. Property taxes, including any assessments collected with taxes, for the fiscal year 2012 - 2013 that are a lien not yet due. B. Property taxes, including any assessments collected with taxes, for the fiscal year 2011 - 2012 1" Installment: $ "No taxes due" 2"" Installment: $ "No taxes due" Code Area: 09157 Assessors Parcel Number: 212-220-57-00 Affects: Parcel A C. Property taxes, for the fiscal year 2011 - 2012 are paid. For proration purposes the amounts are: 1" Installment: $25,102.65 Paid 2"^* Installment: $25,102.65 Paid Code Area: 09095 Assessors Parcel Number: 212-040-47-00 Affects: Parcel B D. The lien of supplemental or escaped assessments of property taxes, if any, made pursuant to the provisions of Part 0.5, Chapter 3.5 or Part 2, Chapter 3, Articles 3 and 4 respectively (commencing with Section 75) of the Revenue and Taxation Code of the State of Califomia as a result of the transfer of title to the vestee named in Schedule A; or as a result of changes in ownership or new construction occurring prior to date of policy. 1. Water rights, claims or title to water, whether or not disclosed by the public records. The Following Matters Affect Parcel A 2. An Agreement, and the terms and conditions as contained therein Dated: July 6, 1982 By and Between: Vista Loma Investments and the City of Carlsbad, a municipal corporation Recorded: December 29, 1982 as file no. 82-398028 of official records Regarding: for the payment of a public facilities fee Reference is hereby made to said document for full particulars. CLTA Preliminary Report Form - Modified (11-17-06) Page 4 Order No.; 127400339-K26 SCHEDULE B (continued) 3. An Agreement, and the terms and conditions as contained therein Dated: August 18, 1988 By and Between: Laurel Tree Investment Company and the City of Carlsbad Recorded: October 10, 1988 as file no. 88-515162 of official records Regarding: for the payment of a public facilities fee Reference is hereby made to said document for full particulars. 4. A document entitled "Deed Restriction", executed by Carlsbad Heights Associates, in favor of The Califomia Coastal Commission, subject to all the terms, provision(s) and conditions therein contained, recorded March 6, 1989 as file no. 89-113853. official records. Modification(s) ofthe terms and provisions of said document as therein provided. Recorded; October 14, 1999 as file no. 1999-0693448. of official records 5. A document entitled "Certified copy of Resolufion No. 97-528 overruling and denying protests and establishing bridge and thoroughfare district no. 2 (Aviara Parkway-Poinsettia Lane) to finance the costs of major public improvements in said city", dated July 8, 1997 executed by the City of Carlsbad, subject to all the terms, provisions and conditions therein contained, recorded July 22, 1997 as file no. 1997-0349124. official records. Reference is hereby made to said document for full particulars. 6. A document subject to all the terms, provisions and conditions therein contained. Entitled: Notice Conceming Aircraft Environmental Impacts Case No. CT 97- 14 Recorded; August 3, 1999 as document no. 99-536800. of Official Records 7. A document subject to all the terms, provisions and conditions therein contained. Entitled; Notice and Waiver Conceming Proximity of the existing Aviara Parkway Transportation Corridor Case No. 97-14 Recorded; August 3, 1999 as document no. 99-536801, of Official Records 8. An avigation easement referred to below and rights incidental thereto as provided in a documents; Recorded; August 6, 1999 as document no. 99-545494, of Official Records Reference is hereby made to said document for full particulars. CLTA Preliminary Report Form - Modified (11-17-06) Page 5 Order No.; 127400339-K26 SCHEDULE B (continued) 9. A document subject to all the terms, provisions and conditions therein contained. Entitled; Hold Harmless Agreement Drainage Recorded; August 9, 1999 as document no. 99-550754. of Official Records 10. A document subject to all the terms, provisions and conditions therein contained. Entitled; Hold Harmless Agreement Drainage Recorded; August 9, 1999 as document no. 99-550755. of Official Records 11. A document subject to all the terms, provisions and conditions therein contained. Entitled; Hold Harmless Agreement Geological Failure Recorded: August 9, 1999 as document no. 99-550756. of Official Records 12. The effect of the following recital contained on the map of said land Map No. 13840 Recital: Lot 135 is a private street 13. The fact that the map of said land contains provisions relating to public improvements and geo- technical requirements, all as set forth on Sheet 11 of said Map No. 13840. 14. A document subject to all the terms, provisions and conditions therein contained. Entitled: Hold Harmless Agreement Drainage Recorded; October 20, 1999 as file no. 1999-0705725. of Official Records 15. Easement(s) for the purpose(s) shown below and rights incidental thereto as reserved in a document; Purpose; Constructing, reasonably maintaining, repairing and renovating the landscaping, landscaping irrigation system and road berms and road surface Recorded; September 7, 2000 as file no. 2000-0480492. of Official Records Affects: said land A document entitled "Assignment and assumption of agreement for grant of easemenf, dated May 24, 2002 executed by Standard Pacific Corp., a Delaware corporation, in favor of Carlsbad Shorepointe Homeowners Association, subject to all the terms, provision(s) and conditions therein contained, recorded June 17, 2002 as Instrument No. 2002-0509145 of official records. 16. A document entitled "Affordable Housing Agreement Imposing Restrictions on Real Property", dated September 28, 2001 executed by the City of Carlsbad, a municipal corporation and Standard Pacific Corp., a Delaware corporation, subject to all the terms, provisions and conditions therein contained, recorded October 10, 2001 as file no. 2001-0732177. official records. CLTA Preliminary Report Form - Modified (11-17-06) Page 6 Order No.; 127400339-K26 SCHEDULE B (continued) The Following Matters Affect Parcel B 17. Covenants and restrictions, if any, appearing in the public records, imposed by any land conservation contract executed pursuant to govemment code sections 51200 et seq. (also called the Williamson Act) authorizing the establishment of agricultural preserves. The use of the land within the preserve may be restricted by the land contract to agricultural, recreational, open-space, and other compatible uses. 18. An easement for the purpose shown below and rights incidental thereto as set forth in a document. Purpose; Public Road Recorded; October 5, 1899 in Book 280, Page 292 of Deeds Affects; The exact location and extent of said easement is not disclosed of record. 19. An easement for the purpose shown below and rights incidental thereto as set forth in a document. (No representation is made as to the present ownership of said easement) In Favor of San Diego Gas & Electric Company Purpose; Public utilities, ingress and egress Recorded: March 19, 1947 in Book 2365, Page 175 of Official Records Affects; That portion of said land as described in the document attached hereto. 20. An easement for the purpose shown below and rights incidental thereto as set forth in a document. Purpose; Road and utility purposes as granted/reserve instmments of record, one of which Recorded; August 8, 1962 as Instrument No. 134624 of Official Records Affects; That portion of said land as described in the document attached hereto. 21. An easement for the purpose shown below and rights incidental thereto as set forth in a document. (No representation is made as to the present ownership of said easement) In Favor of; San Diego Gas & Electric Company Purpose; Public utilities, ingress and egress Recorded; June 19, 1967 as Instrument No. 87836 of Official Records Affects; That portion of said land as described in the document attached hereto. CLTA Preliminary Report Form - Modified (11-17-06) Page 7 Order No.; 127400339-K26 SCHEDULE B (continued) 22. An easement for the purpose shown below and rights incidental thereto as set forth in a document. (No representation is made as to the present ownership of said easement) In Favor of: The Pacific Telephone & Telegraph Company Purpose: Public utilities, ingress and egress Recorded: June 26, 1967 as Instrument No. 91843 of Official Records Affects; That portion of said land as described in the document attached hereto. 23. Record of Survey Map No. 5715. recorded December 19, 1960 which discloses variances from the record legal description of said land. Reference is made to said map for further particulars. 24. A document entitled "San Diego Coast Regional Commission Agreement Imposing Restrictions on Real Property", dated April 28, 1981 executed by Sudan Interior Mission, Inc. and the San Diego Coast Regional Commission, subject to all the terms, provision(s) and conditions therein contained, recorded May 5, 1981 as Instrument No. 81-138858. of Official Records. 25. An easement for the purpose shown below and rights incidental thereto as set forth in a document. (No representation is made as to the present ownership of said easement) In Favor of; Costa Real Municipal Water District Purpose; A pipeline or pipelines Recorded: December 8, 1981 as Instrument No. 81-383916 of Official Records Affects: That portion of said land as described in the document attached hereto. 26. An easement for the purpose shown below and rights incidental thereto as set forth in a document. (No representation is made as to the present ownership of said easement) In Favor of; San Diego Gas & Electric Company Purpose; Public utilities, ingress and egress Recorded; March 31, 1982 as Instrument No. 82-087465 of Official Records Affects: The exact location and extent of said easement is not disclosed of record. 27. A document entitled "Lot Line Adjustment Agreements", dated August 31, 1988 executed by Laurel Tree Investment Company and Sim USA Inc., subject to all the terms, provision(s) and condifions therein contained, recorded September 9, 1988 as Instrument No. 88-453983. of Official Records. Reference is hereby made to said document for full particulars. CLTA Preliminary Report Form - Modified (11-17-06) Pages Order No.; 127400339-K26 SCHEDULE B (continued) 28. Covenants, conditions and restrictions (but omitting any covenant or restrictions, if any, based upon on race, color, religion, sex, sexual orientation, familial status, marital status, disability, handicap, national origin, ancestry, or source of income, as set forth in applicable state or federal laws, except to the extent that said covenant or restriction is pennitted by applicable law) as set forth in the document Recorded: March 6, 1989 as Instrument No. 89-1 13853. of Official Records Note: Section 12956.1 of the govemment code provides the following; "If this document contains any restriction based on race, color, religion, sex, sexual orientation, familial status, marital status, disability, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, that restriction violates state and federal fair housing laws and is void, and may be removed pursuant to section 12956.2 of the Govemment Code. Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status." 29. Covenants, condifions and restrictions (but omitting any covenant or restrictions, if any, based upon on race, color, religion, sex, sexual orientation, familial status, marital status, disability, handicap, national origin, ancestry, or source of income, as set forth in applicable state or federal laws, except to the extent that said covenant or restriction is permitted by applicable law) as set forth in the document Recorded; March 6, 1989 as Instrument No. 89-113854. of Official Records Note: Section 12956.1 of the govemment code provides the following; "If this document contains any restriction based on race, color, religion, sex, sexual orientation, familial status, marital status, disability, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, that restriction violates state and federal fair housing laws and is void, and may be removed pursuant to section 12956.2 of the Govemment Code. Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status." 30. A conditional certificate of compliance Dated; March 31,1989 Executed by; City Engineer, City of Carlsbad Compliance No.; CE 523 Recorded; April 12, 1989 as Instrument No. 89-191109. of Official Records Conditions; as set forth therein Reference is hereby made to said document for full particulars. CLTA Preliminary Report Form - Modified (11-17-06) Page 9 Order No.; 127400339-K26 SCHEDULE B (continued) 31. Certified copy of Resolution No. 97-528, overruling and denying protests and establishing bridge and Thoroughfare District No. 2 (Aviara Parkway-Poinsettia Lane) to finance the costs of major public improvements in said city and recorded July 22, 1997 as Instmment No. 1997-0349124. of Official Records. 32. A Notice of Restriction on Real Property Recorded; August 15, 2007 as Instrument No. 07-543852. of Official Records 33. A document subject to all the terms, provisions and condifions therein contained. Entitled; Permanent Stormwater Quality Best Management Practice Maintenance Agreement Recorded; August 15, 2007 as Instrument No. 07-543853, of Official Records 34. Covenants, conditions and restrictions (but omitting any covenant or restrictions, if any, based upon on race, color, religion, sex, sexual orientation, familial status, marital status, disability, handicap, national origin, ancestry, or source of income, as set forth in applicable state or federal laws, except to the extent that said covenant or restriction is permitted by applicable law) as set forth in the document referred to in the numbered item last above shown. Note; Section 12956.1 of the government code provides the following; "If this document contains any restriction based on race, color, religion, sex, sexual orientation, familial status, marital status, disability, national origin, source of income as defined in subdivision (p) of Section 12955, or ancestry, that restriction violates state and federal fair housing laws and is void, and may be removed pursuant to section 12956.2 of the Govemment Code. Lawful restrictions under state and federal law on the age of occupants in senior housing or housing for older persons shall not be construed as restrictions based on familial status." The Following Matters Affect All Parcels 35. Matters which may be disclosed by an inspection and/or by a correct ALTA/ACSM Land Title Survey of said land that is safisfactory to this Company, and/or by inquiry of the parties in possession thereof This office must be notified at least 7 business days prior to the scheduled closing in order to arrange for an inspection of the land; upon completion of this inspection you will be notified of the removal of specific coverage exceptions and/or additional exceptions to coverage. 36. Any rights of parties in possession of said land, based on any unrecorded lease, or leases. This Company will require a full copy of any unrecorded lease, together with all supplements, assignments, and amendments for review. END OF SCHEDULE B CLTA Preliminary Report Form - Modified (11-17-06) Page 10 Order No.: 127400339-K26 INFORMATIONAL NOTES Note No. 1; Section 12413.1, Califomia Insurance Code became effective Januaty 1, 1990. This legislation regulates the disbursement of funds deposited with any title entity acting in an escrow or sub-escrow capacity. The law requires that all funds be deposited and collected by the title entity's escrow and/or sub-escrow account prior to disbursement of any funds. Some methods of funding may be subject to a holding period, which must expire before any funds may be disbursed. In order to avoid any such delays, all funding should be done via wire transfer. Funds deposited with the Company via wire transfer may be disbursed upon receipt. Funds deposited by cashiers checks, certified checks, and teller's checks is one business day after the day deposited. Other checks may require hold periods from two to five business days after the day deposited, and may delay your closing. The Company may receive benefits from such banks based upon the balances in such accounts. Such benefits will be retained by the Company as part of its compensation for handling such funds. Note No. 2: The charge where an order is cancelled after the issuance of the report of title, will be that amount which in the opinion of the Company is proper compensafion for the services rendered or the purpose for which the report is used, but in no event shall said charge be less that the minimum amount required under Section 12404.1 of the Insurance Code of the State of Califomia. If the report cannot be cancelled "no fee" pursuant to the provisions of said Insurance Code, then the minimum cancellation fee shall be that permitted by law. Note No. 3: Califomia Revenue and Taxation Code Section 18668, effective January 1, 1991, requires that the buyer in all sales of Califomia Real Estate, withhold 3-1/3% of the total sales price as California State Income Tax, subject to the various provisions of the law as therein contained, and as amended. Note No. 4; Wire Transfers In tiie event your transaction is being escrowed by a Chicago Title office, contact should be made •with the office to obtain correct wiring instructions. Failure to do so could result in a delay in the receipt offunds and subsequent closing of your transaction. Chicago Title will disburse by wire-out only collected funds or funds received by confirmed wire-in. The Company's wire-in instructions are: Bank: Union Bank 2001 Michelson Drive. Irvine, CA 92714 Bank ABA No.: 122000496 Account Name: Chicago Title Company, C&I/Subdivision-lnland Account No.: 9120052850 For Credit To: Chicago Title Company 560 East Hospitality Lane San Bemardino, CA 92408 Order No.: 127400339-K26 CLTA Preliminary Report Form - Modified (11-17-06) Page 11 Order No.; 127400339-K26 INFORMATIONAL NOTES (continued) LENDER NOTE: On the DATE you fund the Loan and WIRE Funds to Chicago Title and reference the above Order Number, you must send written NOTICE to the Title Officer's Unit by messenger or E-Mail that you sent the Funds. Chicago Title will send an E-Mail acknowledging receipt of the funds as soon as practicable. Chicago Title will NOT be responsible for any delay in Closing and Recording the transaction, nor will Chicago Title be liable for any claim of lost Interest unless such written Notice is sent the day of Funding and Chicago Title has acknowledged receipt of funds. Note No. 5; Your application for title insurance was placed by reference to a street address or assessor's parcel number. Based upon our records, we believe that the description in this report covers the parcel that you requested. To prevent errors, we require written confirmation that the legal description contained herein covers the parcel that you requested. Note No. 6: The plat, (map), which is attached to this report, is to assist you in locating land with reference to streets and other parcels. While this plat is believed to be correct, the Company assumes no liability for any loss occurring by reason of reliance thereon. Note No. 7; The policy of title insurance will include an arbitration provision. The Company or the insured may demand arbitration. Arbitrable matters may include, but are not limited to, any controversy or claim between the Company and the insured arising out of or relating to this policy, any service of the Company in connecfion with its issuance or the breach of a policy provision or other obligation. Please ask your escrow or title officer for a sample copy of the policy to be issued if you wish to review the arbitration provisions and any other provisions pertaining to your Title Insurance coverage. Note No. 8; The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less than the amount, if any, set forth in the arbitration clause, all arbitrable matters shall be arbitrated at the option of either the Company or the Insured as the exclusive remedy of the parties. CLTA Preliminary Report Form - Modified (11-17-06) Page 12 Order No.: 127400339-K26 INFORMATIONAL NOTES (continued) Note No. 9; This Company will require for review the following documents from the following Limited Liability Company: Cottage Row Carlsbad LLC, a Califomia limited liability company A. A copy of its Operating Agreement and any and all amendments, supplements and/or modifications thereto, certified by the appropriate manager. B. Confirmation that its Articles of Organization (LLC-1), and Certificate of Amendment (LLC-2), any restated Articles of Organizafion (LLC-10) and/or any Certificate of Correction (LLC-11) have been filed with the Secretaty of State. C. If the Limited Liability Company is member-managed a full and complete list of members certified by the appropriate manager. D. If the Limited Liability Company was formed in a foreign jurisdiction, evidence, satisfactoty to the Company, that it was validly formed, is in good standing and authorized to do business in the state of origin. E. If the Limited Liability Company was formed in a foreign jurisdiction, evidence satisfactoty to the Company, that it has complied with Califomia "doing business" laws, if applicable. CLTA Preliminary Report Form - Modified (11-17-06) Page 13 Order No.: 127400339-K26 INFORMATIONAL NOTES (continued) ATTACHMENT ONE PRIVACY STATEMENT IMPORTANT INFORMATION: For those of vou receiving this report by electronic delivery the Privacy Statement and Exclusions From Coverage are linked to this report. Please review this information by selecting the link. For those of you who are receiving a hard copy of this report, a copy of this information has been submitted for vour review. CLTA Preliminary Report Form - Modified (11-17-06) Page 14 Order No.: 127400339-K26 INFORMATIONAL NOTES (continued) NOTICE You may be entitled to receive a $20.00 discount on escrow services if you purchased, sold or refinanced residential property in California between May 19, 1995 and November 1, 2002. If you had more than one qualifying transaction, you may be entitled to multiple discounts. If your previous transaction involved the same property that is the subject of your current transaction, you do not have to do anything; the Company will provide the discount, provided you are paying for escrow or title services in this transaction. If your previous transaction involved property different from the property that is subject of your current transaction, you must - prior to the close of the current transaction - inform the Company of the earlier transaction, provide the address of the property involved in the previous transaction, and the date or approximate date that the escrow closed to be eligible for the discount. Unless you inform the Company of the prior transaction on property that is not the subject of this transaction, the Company has no obligation to conduct an investigation to determine if you qualify for a discount. If you provide the Company information conceming a prior transaction, the Company is required to determine if you qualify for a discount which is subject to other terms and conditions. CLTA Preliminary Report Fomi - Modified (11-17-06) Page 15 NOTICE OF EXEMPTION To: SD County Clerk From: CITY OF CARI.SBAD 0 IL S (§) Attn: James Scott Planning Division flmt) 1)mHltmtk.ttm>,«gCm(M 1600 Pacific Highway, Suite 260 1635 Faraciay Avenue PO Box 121750 Carlsbad, CA 92008 AUG 19 2013 San Diego, CA 92101 (760)602-4600 C. DUefiaS Subject: Filing of this Notice of Exemption is in compliance with Section 21152b of the Public Resources Code (California Environmental Quality Act). Project Number and Title: SDP 12-06/PUD 13-01/CUP 1990(C) COTTAGE ROW APARTMENTS Project Location - Specific: 1400 FLAMETREE LANE Project Location - City: Carlsbad Project Location - County: San Diego Description of Project: A modification to the conditions of approval to lift the restriction of onlv allowing rental of the units within the propertv as a faith based retirement proiect and allowing all of the 24 apartments to be rented at market rate to the general public. Name of Public Agency Approving Project: Citv of Carlsbad Name of Person or Agency Carrying Out Project: Cottage Row Carlsbad LLC Name of Applicant: Cottage Row LLC c/o Jack Henthorn Associates Applicant's Address: PO Box 237 Carlsbad CA 92018 Applicant's Telephone Number: 760-438-4090 Exempt Status: (Checl< One) • Ministerial (Section 21080(b)(1); 15268); • Declared Emergency (Section 21080(b)(3); 15269(a)); • Emergency Project (Section 21080(b)(4); 15269 (b)(c)); • Categorical Exemption - State type and section number: • Statutory Exemptions - State code number: S General rule (Section 15061(b)(3)) Reasons why project is exempt: No physical change to the existing facilities nor is there an intensification ofthe use. The action is purelv administrative. Lead Agency Contact Person: Christer Westman Telephone: 760-602-4614 DON NEU, City Planner Date Date received for filing at OPR: ^'^ED IN THE OFFICE OF THE COUNTY CLERK SanDiego Countv on AUG 1 9 2013 Posted AUG 1 9 2013 Removed SEP 1 7 201.1 Retumedtoagencvon .qpp 1 7 2013 0^ C. nuefias state of California—The Resources Agency DEPARTMENT OF FISH AND WILDLIFE 2013 ENVIRONMENTAL FILING FEE CASH RECEIPT SEE INSTRUCTIONS ON REVERSE. TYPE OR PRINT CLEARLY RECEIPT* SD2013 0663 2013 ENVIRONMENTAL FILING FEE CASH RECEIPT SEE INSTRUCTIONS ON REVERSE. TYPE OR PRINT CLEARLY STATE CLEARING HOUSE #fffapp//caWe; LEAD AGENCY CITY OF CARLSBAD PLANNING DIVISION DATE 08/19/2013 COUNTY/STATE AGENCY OF FILING SAN DIEGO DOCUMENTNUMBER *20130663* PROJECTTITLE SDP 12-06/PUD 13-01/CUP 1990( C) COTTAGE ROW APARTMENTS PROJECTAPPLICANT NAME COTTAGE ROW LLC C/O JACK HENTHORN ASSOCIATES PHONENUMBER 760-438-4090 PROJEGT APPLICANT ADDRESS PO BOX 237 CITY CARLSBAD STATE CA ZIP CODE 92018 PROJECTAPPLICANT (Check appropriate box): • Local Public Agency • School District Q Other Special District • State Agency • Private Entity CHECK APPLICABLE FEES: • Environmental Impact Report Q Negative Declaration • Application Fee Water Diversion ("Sfafe Wafer Resources Control Board Only) • Projects Subject to Certified Regulatory Program • County Administrative Fee • Project that is exempt from fees EJ Notice of Exemption • DFG No Effect Determination (Form Attached) • Other PAYMENT METHOD: • Cash • Credit Q Check • Other ^HK: 2381 $2,995.25 $2,156.25 $850.00 $1,018.50 $50.00 $50.00 TOTAL RECEIVED $50.00 SIGNATURE X C. Duefias TITLE Deputy CrryOFCARlSBAD SEP 19 2013 PiANNiNaoe>AHrMEiirr iiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiii ORIGINAL - PROJECT APPLICANT COPY-DFG/ASB COPY-LEAD AGENCY COPY-COUNTY CLERK FG 763.5a (Rev, 7/08) VICARLSBAD CITY OF Community & Economic Development www.carlsbadca.gov PLANNING COMMISSION NOTICE OF DECISION August 8, 2013 Jack Henthorn & Associates P 0 Box 237 Carlsbad CA 92018-0237 SUBJECT: SDP 12-06/PUD 13-01/CUP 190(C) - COTTAGE ROW APARTMENTS At the August 7, 2013 Planning Commission meeting, your application was considered. The Commission voted 7-0 to approve your request. The decision of the Planning Commission is final on the date of adoption unless a written appeal to the City Council is filed with the City Clerk within ten (10) calendar days in accordance with the provisions of Carlsbad Municipal Code section 21.54.150. The written appeal must specify the reason or reasons for the appeal. Ifyou have any questions regarding the final dispositions of your application, please contact your project planner Christer Westman at (760) 602-4614 or christer.westman@carlsbadca.gov. Sincerely, DON NEU, AICP City Planner DN:CW:fn c: Data Entry File enc: Planning Commission Resolution No. 7005 Planning Division 1635 Faraday Avenue, Carlsbad. CA 92008-7314 T 760-602-4600 F 760-602-8559 Ul SanBieg PL^^I ING COMMISSION PUBLIC HEARING (NOTICE IS HEREBY GIVEN to you, because vour In AFFIDAVIT OF P tF^''°^»^'^<'^lST^B&SM,^ The proiect Is exempt from the California Environmental Quali- P.O, Box 120191, San Diec STATE OF CALIFORNIA} ss. County of San Diego} The Undersigned, declares under penalty of perjury under the laws of the State of California: That she is a resident of the County of San Diego. That she isandatall times herein mentioned was a citizen of the United States, over the age of twenty-one years, and that he is not a party to, nor interested in the above entitled matter; that he is Chief Clerk for the pubUsher of The San Diego Union-Tribune - North County a newspaper of general circulation , printed and pubUshed daily in the City of San Diego, County of San Diego, and which newspaper is published for the dissemination of local news and intelUgence of a general character, and which newspaper at all the times herein mentioned had and still has a bona fide subscription list of paying subscribers, and which newspaper has been estabUshed, printed and pubUshed at regular intervals in the said City of San Diego, County of San Diego, for a period exceeding one year next preceding the date of pubUcation of the notice hereinafter referred to, and which newspaper is not devoted to nor puWished for the interests, entertainment or instruction of a particular class, profession, trade, calUng, race, or denomination, or any number of same; that the notice of which the armexed is a printed copy, has been published in said newspaper in accordance with the instructions of the person(s) requesting pubUcation, and not in any supplement thereof on the following dates, to wit: July 26*, 2013 Chief Clerk for the Publisher Jane Allshouse On this 26'^ day of July, 2013 MlST«""'¥if*"° ;3-01/CUP mCC) - COTTAGE ROW APART-Sif thIr;JJl®i''S''?*=* is exempt from the provision™ (rfCEQA per the General Rule and a request forthe oDDrava nf n rnnSi The project is exempt from the California Environmental Quali- 12-01/LCPA 12-02 - KELLY CORPORATE CEN- JI5^^?f the recommendatiSjfof adopttoriof a MlS^ S2rti^*2'^* Declaration and a Mitigation Monitoring o?id^^^^ f ™9''S'" °!?<* o recommendation of approva of a Gener-S!,«i^"/'"^!].'?'"e"t to change the General Plan Land Use des?^^ ^'°""ed Industrial (Pl) and Open Space fof) tl^^^^^ Z^eS '^'^ Facilities &gem^nt ^Sln w t?,?'^" measures hpVe been liSled Sy conlit ohs o^^ and Mitigotion Monitoring afid Rewrtf™^Proa?im fV/wppR^ which was previously published in t'he'^Xtt for pS'^^^^ miX?n„*^i?^'ii®Il?® proiects in court, you may be limited to CITY OF ^ F 1 LE CARLSBAD Community & Economic Development www.carisbadca.gov NOTICE OF PUBLIC HEARING NOTICE IS HEREBY GIVEN to you that the Planning Commission of the City of Carlsbad will hold a public hearing at the Council Chambers, 1200 Carlsbad Village Drive, Carlsbad, California, at 6:00 p.m. on Wednesday, August 7,2013, to consider a request for the following: CASE NAME: SDP 12-06/PUD 13-01/CUP 190(C) - COTTAGE ROW APARTMENTS PUBLISH DATE: July 26, 2013 DESCRIPTION: The project is exempt from the provisions of CEQA per the General Rule and a request for the approval of a Conditional Use Permit amendment CUP 190(C) to revoke Conditional Use Permit CUP 190(B), and the approval of a Site Development Plan SDP 12-06 and Planned Development Permit PUD 13-01 to allow for the existing 24 apartment units to remain onsite and be made available for rent to the general public on property generally located at 1400 Flametree Lane in Local Facilities Management Zone 20. Those persons wishing to speak on this proposal are cordially invited to attend the public hearing and provide the decision makers with any oral or written comments they may have regarding the project. Copies of the staff report will be available online at http.7/carlsbad.granicus.com/ViewPublisher.php?view id=6 on or after the Friday prior to the hearing date. If you have any questions, or would like to be notified of the decision, please contact Christer Westman in the Planning Division at (760) 602-4614, Monday through Thursday 7:30 a.m. to 5:30 p.m., Friday 8:00 a.m. to 5:00 p.m. at 1635 Faraday Avenue, Carlsbad, California 92008. APPEALS The time within which you may judicially challenge these projects, if approved, is established by State law and/or city ordinance, and is very short. If you challenge this project in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice or in written correspondence delivered to the City of Carlsbad at or prior to the public hearing. • Appeals to the Citv Council: Where the decision is appealable to the City Council, appeals must be filed in writing within ten (10) calendar days after a decision by the Planning Commission. CITY OF CARLSBAD PLANNING DIVISION Planning Division 1635 Faraday Ave. I Carlsbad, CA 92008 ! 760-602-4600 i 760-602-8558 fax N NOT TO SCALE SITEMAP Cottage Row Apartments SDP12-06 / PUD 13-01 / CUP 190(C) V CARLSBAD Community & Economic Development www.carlsbadca.gov I EARLY PUBLIC NOTICE | PROJECT NAME: COTTAGE ROW APARTMENTS PROJECT NUMBER: SDP 12-06/PUD 13-01 This early public notice is to let you l<now that a development application for a modification to the conditions of approval for an existing rental project within your neighborhood has been submitted to the City of Carlsbad on December 21, 2012. The project application is undergoing its initial review by the City. LOCATION: The existing Cottage Row Carlsbad project is located on Flame Tree Lane which is west of Aviara Parl<way and north of IVIariposa Road and east of Ebb tide Street. PROJECT DESCRIPTION: A requested modification to the conditions of approval to lift the restriction of only allowing rental of the units within the property as a faith based retirement project and allowing all of the existing 24 apartments to be rented at market rates. Please keep in mind that this is an early public notice and that the project design could change as a result of further staff and public review. A future public hearing notice will be mailed to you when this project is scheduled for public hearing before the Planning Commission. CONTACT INFORMATION: If you have questions or comments regarding this proposed project please contact Christer Westman, Senior Planner at christer.westman(gcarlsbadca.gov, 760-602-4614, City of Carlsbad Planning Division, 1635 Faraday Avenue, Carlsbad, CA 92008. Planning Division 1635 Faraday Avenue, Carlsbad, CA 92008-7314 T 760-602-4600 F 760-602-8559 © ATTACHMENT "2" CERTIFICATION OF POSTING I certify that the "Notice of Project Application" has been posted at a conspicuous location on the site on Au% i3 . (DATE/ SIGNATURE: PROJECT NUMBER LOCATION PRINT NAME: IPIH 'J^^'-h h j (f^J(.W^ IjVs O PROJECT NAME: QUTT^^^ (AJ RETURN TO (Planner) CITY OF CARLSBAD PLANNING DIVISION 1635 Faraday Avenue Carlsbad, CA 92008-7314 p-21 Page 4 of 6 Revised 07/10 ^ EIA INFORMATION Development Services FORM Planning Division CITY OF P i/n\ 1635 Faraday Avenue PARI ^RAD (760)602-4610 V_./^I\I_-JLir*L/ wvvw.carlsbadca.gov INSTRUCTION SHEET FOR COMPLETING AN ENVIRONMENTAL IMPACT ASSESSMENT INFORMATION FORM This Environmental Infonnation Form will be used to assist staff in detennining what type of environmental documentation (i.e.. Environmental Impact Report, Mitigated Negative Declaration, Negative Declaration or Exemption) will be required to be prepared for your application, per the Califomia Environmental Quality Act (CEQA) and Titie 19 of Carisbad's Municipal Code. The clarity and accuracy of the information you provide is critical for purposes of quickly detennining the spedfic environmental effects of your project. Any environmental studies (i.e., bioiogical, cultural resource, traffic, noise) that are necessary to substantiate a "no impact" or "yes Impact" determination should be submitted as an attachment to this Environmental Information Form. This is especially important when a Negative Declaration is being sought. The more infonnation provided in this fonn, the easier and quicker it will be for staff to complete the Environmental Impact Assessment Form - Initial Study. p-1(D) Page 1 of 4 Revised 07/10 ENVIRONMENTAL INFORMATION FORM (To be Completed by Applicant) Date Filed: 1 ^-3L (I ^ (To be completed by City) ApplicatkM)Number(s): S^P l^-^OC/s General Information 1. Nameof project: Cottage Row Apartments Name of devetoper or project sponsor Cottage Row Carlsbad, LLC Address: P.O. Box 2194 City, State. Zip Code: Newport Beach, CA 92659 949 351-4890 Phone Number: Nanrie of person to be contacted conceming this project: Jack Henthom Address: PO Box 237 City. State. Zip Code: Carlsbad, CA 92018 K. u 760 438-4090 Phone Number 1400 Flame Ttree Lane, Carlsbad, CA 92011 Address of Project Assessor's Parcel Number 212-040-47-00 5. List and describe any other related pennits and other public approvals required for this project, including those required by city, regional, state and federal agencies: 6. Existing General Plan Land Use Designation: c va- • ^-^^ Residential Rl-IOQ 7. Existing zoning distnct ^ , ^ Residential 8. Existing land use(s): 24 Apartments (existing bldgs.) Proposed use of site (Project for which this form is filed): Project Description o-x • 12.1 Acres 10. Site size: 11. Proposed BulMing square footage: 26,419 Sqf t + 745 Sqft accessory (All Existing) 1 12: Numl)er of fk)ors of construction: 57 13. Amountof off-street parking provided: 14. Associated prpjects: p-1 (D) Page 2 of 4 Revised 07/10 15. If residential, include the number of units and schedule of unit sizes: 24 units (existing) 16. If commercial, indicate the type, whether neighborhood, city or regionally oriented, square footage of sales area, and loading fedlities: 17. If industrial, indicate type, estimated employment per shift, and loading facilities: 18. If institutional, indicate the major function, estimated employment per shift, estimated occupancy, loading facilities, and community benefits to be derived from the project: 19. If the project involves a variance, condittonal use or rezoning applications, state this and indicate cleariy why the application is required: P-1(D) Page 3 of 4 Revised 07/10 Are the following items applicable to ffie project or its effects? D/scuss all itents checked yes (attach additional sheets as necessary). Yes No 20. ChangeinexistinglieaturBsofanybays,tklelands, beaches, or hilte, or substantial • • alteratk>n of ground contours. 21. Change in scenk: views or vistas from existing resklential areas or public lands or G • roads. 22. Change in pattem, scale or character of general area of project • G 23. SIgnifksnt amounts of solkJ waste or litter. G G 24. Changeindustash, smoke, fumes or odors in vk:inity. G G 25. Change in ocean, bay, lake, stream or ground water quality or quantity, or G G alteratk>n of existing drainage pattems. 26. Substantial change in exiting noise or vibration levels in the vicinity. G G 27. Site on filled land or on stope of 10 percent or more. G G 28. Use of disposal of potentially hazardous materials, such as toxic substances, G G flammertsles or e)q}tosives. 29. Substantial change in demand for municipal services (polk», fire, water, sewage, G G etc.). 30. Substentially increase fossil ftiel consumptton (etectridty, oil, natural gas. etc.). G G 31. Relationship to a larger project or series of projects. G G Environmental Setting Attech sheets that include a response to the following questions: 32. Describe the project site as It exists before the project, including information on topography, soil stebility, plants and animals, and any cultural, historical or scenic aspects. Describe any existing structures on the site, and the use of the struc^res. Attach photographs of the site. Snapshote or Polaroid photos will be accepted. 33. Describe ttie surrounding properties, including information on plants and animals and any cultural, historical or scenic asp>ects. Indicate the type of land use (residential, commercial, ete.), intensity of land use (one-family, apartment houses, shops, department stores, ete.), and scale of devetopment (height ftontege, set-back, rear yard, etc.). Attach photographs of the vicinity. Snapshote or polaroid photos will be accepted. Certification I hereby certify that tiie stetemente fumished above and in tiie atiached exhibite present the date and information required for this initial evaluation to ttie best of my ability, and that tiie focte, stetemente, and information presented are true and correct to the best of my knowledge and belief. Date: Signature: For P-1 (D) Page 4 of 4 Revised 07/10 November 14, 2013 Jack Henthom & Associates P.G. Box 237 Carlsbad, California 92018-0237 (760) 438-4090 Fax (760) 438-0981 RECEIVED NOV 2 0 2013 CITY OF CARLSBAD PLANNING DIVISION Mr. Chris DeCerbo, Principal Planner City ofCarlsbad Planning Department 1635 Faraday Ave. Carlsbad, California 92008 Subject: Cottage Row Apartments, PRE 13-20 response letter, item 3 and SDP 12-06/PUD 13-01/ CUP 190(C) hearing comments - site access response. Dear Mr. DeCerbo: The owner of the Cottage Row apartment site. Cottage Row Carlsbad, LLC, has reviewed the response letter to the Preliminary Review application filed by City Ventures regarding potential reuse of the property. The owner has also reviewed the petitions filed by property owners within the Shore Pointe development and was present at the Planning Commission meeting of August 7 where the petition points were presented during a public hearing to consider approval of a site development plan and an amendment to the previously existing Conditional Use Permit. In addition to issues related to the ultimate physical development of the site, the Shore Pointe owners expressed concern with the potential closure of the Flame Tree Lane access to Aviara Parkway. The concerns were related to the fact that if Flame Tree is closed, the Cottage Row site would be accessible only through the Shore Pointe Development, via Mariposa Road and Sweet Briar Circle. The owner retained the firm of RBF to conduct an assessment of the Flame Tree Lane access at Aviara Parkway. This assessment concludes that the current location, configuration and operation of this access point on Aviara Parkway could serve a future development ofthe size proposed by City Ventures, does not create a traffic safety concern and should be allowed to remain to serve the property. Therefore, it is requested that you include this assessment in the PRE 13-20 file as a response to the circulation concerns reflected in the petitions referenced in item number 3 of your letter of August 9. 2013. 1902 Wright Place, Ste 200, Carlsbad, CA 92008 Additionally, it is requested that a copy of the assessment be placed in the SDP 12-06/PUD 13-01/CUP 190(C)-COTTAGE ROW APARTMENT file to address the concerns expressed during the Commission hearing of August 7. Thank you. 'Jack E. Henthorn JEH:wpc End: Cottage Row Apartments Access Assessment cc: Don Neu, City Planner Jason Goff, Associate Planner David Rick, Project Engineer Greg Ryan, Fire Prevention Bill Plummer iCompany November 1, 2013 JN: 137993 Mr. Russell Radach COTTAGE ROWS LLC 451 Hawthorn Road Laguna Beach, CA 92651 Subject: Cottage Row Apartments Access Assessment Dear Mr. Radach: At the request of the current owners, RBF conducted an access assessment for the property currently occupied by the Cottage Row Apartments located at Flame Tree Lane and Aviara Parkway in the City of Carlsbad. The assessment was conducted to assess viability of the project driveway intersection in response to neighboring property owner concerns regarding a recent proposal to replace the existing apartments with 38 detached residential units. This access assessment addresses the following potential issues: • Sight distance issues at project driveway • Weaving issues approaching/departing project driveway (acceleration/deceleration) • Safety issues based on accident history • Issues related to the City's intersection spacing requirements Site Access Description The site currently takes access from Flame Tree Lane, which intersects Aviara Parkway, and from Sweet Briar Circle via a private driveway connection with Mariposa Road. Flame Tree Lane intersects Aviara Parkway approximately 600 feet south of Aviara Parkway / Laurel Tree Way, and approximately 300 feet north of Aviara Parkway / Mariposa Road. Both Aviara Parkway / Laurel Tree Way and Aviara Parkway / Mariposa Road are signalized intersections. The existing raised center median on Aviara Parkway restricts access at Flame Tree Lane to right-turns in/right-turns out. Sight Distance Assessment RBF evaluated the sight distance at the project driveway intersection (Flame Tree Lane / Aviara Parkway) to determine if adequate corner sight distance would be provided for vehicles exiting the project site. Aviara Pari<way is a four-lane arterial and a horizontal curve exists on Aviara Parkway between Laurel Tree Way and Mariposa Road. PLANNING • DESIGN • CONSTRUCTION 5050 Avenida Encinas, Suite 260, Carisbad, California 92008 • 760.476.9193 • FAX 760.476.9198 Offices located throughout California, Arizona & Nevada • www.RBF.com Mr. Russell Radach JN: 137993 November 1, 2013 Page 2 Since Flame Tree Lane is restricted to right-tum in/right-turn out access, this sight distance assessment only addresses sight distance looking north on Aviara Parkway from Flame Tree Lane. Aviara Parkway has a posted speed limit of 45 miles per hour (MPH) in both directions of travel. From Laurel Tree Way, vehicles on southbound Aviara Parkway travel uphill toward Mariposa Road. According to Table 405.1A of the Caltrans Highway Design Manual (2012), the minimum corner sight distance for a design speed of 45 MPH is 495 feet. A field sight distance measurement was taken from Flame Tree Lane looking north onto southbound Aviara Pari<way. The field- measured sight distance looking north from Flame Tree Lane is approximately 1,110 feet. Based on the posted speed limit for southbound traffic, the minimum comer sight distance requirement of 495 feet will be provided looking north from the project driveway. Exhibit 1 graphically displays the minimum comer sight distance required and field-measured sight distance from Flame Tree Lane. As shown, there is a decrease in elevation of approximately 60 feet looking north from Flame Tree Lane to the far extent of the observed line of sight. Despite the horizontal curvature of Aviara Parkway between Laurel Tree Way and Mariposa Road, adequate sight distance is provided due to the downhill topography of southbound Aviara Parkway when looking north from Flame Tree Lane. Weaving Assessment The speed differential tiiat would occur between vehicles entering or exiting the driveway and the through traffic on southbound Aviara Paricway is a potential issue given the location of the project driveway. Vehicles approaching the driveway would decelerate to approximately 10 MPH to make a right-tum into the driveway, while through t^ffic is traveling at approximately 45 MPH. Vehicles exiting the driveway will also be traveling at a slower speed than the through traffic on Aviara Paricway, and will be ti'aveling uphill as they accelerate. There are two through lanes and a bike lane on southbound Aviara Paricway approaching Flame Tree Lane. Gaps in traffic will occur due to the nearisy ti'affic signal. When gaps occur, vehides from the driveway can enter Aviara Paricway without disrupting through traffic. For vehicles tuming right into the driveway, they would normally enter tiie bike lane to decelerate, reducing the potential effect of through traffic. Right-tuming vehicles would normally block a portion of the outside through lane, which would potentially disrupt the flow of through ti'affic and inaease the potential for rear-end collisions. Mr. Russell Radach JN: 137993 November 1, 2013 Page 3 Accident History Assessment Accident history data was provided by tiie City of Carisbad for a period of approximately three years and nine months (January 2010 through September 2013) along Aviara Paricway in the nearby vicinity of the project driveway. Table 1 summarizes the accident history along Aviara Parkway between Laurel Tree Way and Mariposa Road from 2010 through 2013. As shown in the table, a total of two accidents cxxun'ed since January 2010: one accKlent at Aviara Paricway / Mariposa Road occuri'ed in May 2010, and a second accident at Aviara Paricway / Laurel Tree Way occurred in Febmary 2013. Table 1 Accident History Summary 2010-2013 Intersection or Midblock Location Accident Location Totel Dateof Accident Type of Accident Intersection or Midblock Location At/Near Intersection Midblock Totel Dateof Accident Type of Accident Aviara Pkwy. / Laurel Tree Way 1 0 1 2/5/2013 Broadside Aviara Pkwy. Between Laurel Tree Way and Mariposa Rd. 0 0 0 -- Aviara Pkwy. / Mariposa Rd. 1 0 1 5/14/2010 Head-On Totel 2 0 2 Source: City of Carlsbad Transportation Department/Tnaflic Division Based on the accident history data provided by tiie City of Carisbad, the fl'equency of accidents along this section of Aviara Paricway is very low. The accident history does not identify any mid-block accidents (rear-end, sideswipe, bicycle or pedestrians) along the project frontage. /Assessment of Intersection Spacing Requirements Aviara Paricway is identified as a Major Arterial in the City of Carisbad General Plan Circulation Element. According to the City's Engineering Standards (Table A - City of Carisbad Sfreet Design Criteria), the minimum intersection spacing on a Major Arterial is 1,200 feet, including right-tum in/out intersections. Historically, exceptions to the standard intersection spacing have been granted for intersections restricted to right-turns in/out where medians preclude illegal tuming movements. Examples of tiiese conditions can be found along Aviara Paricway and throughout the City's circulation system. Flame Tree Lane is an existing right-tum in/out only intersection located between the two signalized intersections of Aviara Paricway / Laurel Tree Way and Aviara Paricway / Mariposa Road. The distance from Flame Tree Lane to Laurel Tree Way is approximately 600 feet, and the distance fi-om Flame Tree Lane to Mariposa Road is approximately 300 feet Mr Russell Radach JN: 137993 November 1, 2013 Page 4 Although tiie project driveway location does not meet the City's minimum intersection spacing requirements, tiie project driveway should be exempt from this standard for a few key reasons: • The City's minimum intersection spacing requirements are intended for new sfreets not yet constoticted; Flame Tree Lane is an existing private street. In addition. Flame Tree Lane pre- existed the construction of Aviara Paricway and was accommodated in the design and constaxiction ofthe improvements. • City records indicate that tiiere have been no accidents at the existing Flame Tree Lane access during tiie study period. In the three year period covered by the City data there were only two accidents in the entire length between signalized intersections at Laurel Tree Way and Mariposa Road • Project trips at the driveway would be relatively low, between 30-40 trips during the peak hours. • Conflicts with through fraffic would be minimal due to right-tum in/out configuration of the project driveway. • Sight distance at the driveway intersection is over twice the minimum distance required • Road width and topography of the area contribute to the ability of drivers to make safe weaving maneuvers around right-tuming vehicles at the driveway intersection Conc/iis/ons In summary, RBF found that the driveway under conskleration has no geometric or operational issues based on the analysis conducted and the data provided by tiie City. As shown, the minimum required comer sight distance will be met looking north onto Aviara Paricway from ttie project driveway (Flame Tree Lane). The higher elevation of Flame Tree Lane provides a clear unobstiTJCted view of southbound Aviara Paricway almost to Palomar Airport Road. In assessing tiie potential issues associated with weaving fa-affic and fraffic conflicts at the project driveway intersection, it is our professional opinion that these issues are less significant at this location than what might be found at other locations. Excessive speeding of through traffic is prevented by the uphill topography of southbound Aviara Paricway and the short distances between the driveway and the traffic signals at Laurel Tree Way and at Mariposa Road. The findings of the accident history assessment showed that the frequency of accidents in the last four years is very low on Aviara Parkway from Laurel Tree Way to Mariposa Road. The accident history does not identify any mid-block accidents along this section of Aviara Paricway during the three-year data period. Although the project driveway location (Flame Tree Lane) does not meet tiie City's minimum spacing of 1,200 feet for a Major Ari:erial (Aviara Paricway), tiiis driveway should be exempt from the minimum intersection spacing requirement Several reasons have been provided to suggest that the minimum Mr Russell Radach JN: 137993 November 1, 2013 Page 5 spacing standard should be waived for future redevelopment of tiie site at levels proposed in the Preliminary Review submittal. At the time of development, it is anticipated that a more detailed, project specific, analysis of this issue would be prepared and presented to the City. However, based on the infonnation from the last submittal, the existing intersection location, configuration and operation do not create a traffic safety concem and tiie intersection should remain to serve the property Please call me at (760) 603-6247 if you have any questions or need additional infonnation. Sincerely, Thank you, David Mizell, AICP, FTP Transportation Planning Services s r . 9 \ELEVATION = 83' SIGHT DISTANCE EXHIBIT AVIARA PKWY O FLAME TREE LArC SPEED LIMIT = 45MPH MINIMUM CORtCR SIGHT DISTANCE = 495" (BASED ON CALTRANS HIGHWAY DESIGN MANUAL, 2012) LEGEND MINIMIUM REQUIRED SIGHT DISTANCE FIELD-MEASURED SIGHT DISTANCE am VEHICLE caNauuTiNQ CITY OF CARLSBAD REVIEW AND COMMENT MEMO DATE: MARCH 25. 2013 PROJECT NO(S): SDP 12-06/PUD 13-01 REVIEW NO: 2 PROJECTTITLE: COTTAGE ROW APPLICANT: JACK HENTHORN AND ASSOCIATES TO: • • • • • • • • • • Land Development Engineering Police Department - J. Sasway Fire Department - Greg Ryan Building Department - Will Foss Recreation - Mark Steyaert Public Works Department (Streets) - Nick Roque Water/Sewer District Landscape Plancheck Consultant - PELA School District North County Transit District - Planning Department Sempra Energy - Land Management Caltrans (Send anything adjacent to 1-5) Parks/Trails - Liz Ketabian •ALWAYS SEND EXHIBITS FROM: PLANNING DEPARTMENT Please review and submit written comments and/or conditions to the PLANNING TRACKING DESK in the Planning Department at 1635 Faraday Avenue, bv 04/15/2013. Ifyou have "No Comments," please so state. If vou determine that there are items that need to be submitted to deem the application "complete" for processing, please immediatelv contact the applicant and/or their representatives (via phone or e-mail) to let them know. Thank you COMMENTS: signature PLANS ATTACHED Review & Comment 05/11 CITY OF CARLSBAD REVIEW AND COMMENT MEMO DATE: MARCH 25. 2013 PROJECT NO(S): SDP 12-06/PUD 13-01 REVIEW NO: 2 PROJECTTITLE: COTTAGE ROW APPLICANT: JACK HENTHORN AND ASSOCIATES TO: • • • • • • • • • • Land Development Engineering Police Department - J. Sasway Fire Department - Greg Ryan Building Department - Will Foss Recreation - Mark Steyaert Public Works Department (Streets) - Nick Roque Water/Sewer District Landscape Plancheck Consultant - PELA School District North County Transit District - Planning Department Sempra Energy-Land Management Caltrans (Send anything adjacent to 1-5) Parks/Trails - Liz Ketabian •ALWAYS SEND EXHIBITS FROM: PLANNING DEPARTMENT Please review and submit written comments and/or conditions to the PLANNING TRACKING DESK in the Planning Department at 1635 Faraday Avenue, bv 04/15/2013. Ifyou have "No Comments," please so state. If vou determine that there are items that need to be submitted to deem the application "complete" for processing, please immediatelv contact the applicant and/or their representatives (via phone or e-mail) to let them know. Thank you COMMENTS: I Signat Signature Date PLANS ATTACHED Review & Comment 05/11 CITY OF CARLSBAD REVIEW AND COMMENT MEMO DATE: MARCH 25. 2013 PROJECT NO(S): SDP 12-06/PUD 13-01 REVIEW NO: 2 PROJECT TITLE: COTTAGE ROW APPLICANT: JACK HENTHORN AND ASSOCIATES TO: • • • • • • • • • • Land Development Engineering Police Department-J. Sasway Fire Department - Greg Ryan Building Department - Will Foss Recreation - Mark Steyaert Public Works Department (Streets) - Nick Roque Water/Sewer District Landscape Plancheck Consultant - PELA School District North County Transit District - Planning Department Sempra Energy-Land Management Caltrans (Send anything adjacent to 1-5) Parks/Trails - Liz Ketabian "^ALWAYS SEND EXHIBITS FROM: PLANNING DEPARTMENT Please review and submit written comments and/or conditions to the PLANNING TRACKING DESK in the Planning Department at 1635 Faraday Avenue, bv 04/15/2013. Ifyou have "No Comments," please so state. If vou determine that there are items that need to be submitted to deem the application "complete" for processing, please immediatelv contact the applicant and/or their representatives (via phone or e-mail) to let them know. Thank you COMMENTS: Signature Date PLANS ATTACHED Review & Comment 05/11 ^^^^ CITY OF CARLSBAD REVIEW AND COMMENT MEMO DATE: DECEMBER 21. 2012 PROJECT NO(S): SDP 12-06 REVIEW NO: 1 PROJECTTITLE: COTTAGE ROW APARTMENTS APPLICANT: JACK HENTHORN TO: m • • • • • • • • Land Development Engineering Police Department-J. Sasway Fire Department - Greg Ryan Building Department - Will Foss Recreation - Mark Steyaert Public Works Department (Streets) - Nick Roque Water/Sewer District Landscape Plancheck Consultant PELA School District North County Transit District - Planning Department Sempra Energy-Land Management Caltrans (Send anything adjacent to 1-5) Parks/Trails - Liz Ketabian •^ALWAYS SEND EXHIBITS FROM: PLANNING DEPARTMENT Please review and submit written comments and/or conditions to the PLANNING TRACKING DESK in the Planning Department at 1635 Faraday Avenue, bv 01/11/2013. Ifyou have "No Comments," please so state. If vou determine that there are items that need to be submitted to deem the application "complete" for processing, please immediatelv contact the applicant and/or their representatives (via phone or e-mail) to let them know. Thank you COMMENTS: Signature Date PLANS ATTACHED Review & Comment 05/11 ^CARLSBAD Memorandum Januarys, 2013 To: Christer Westman, Project Planner From: David Rick, Project Engineer Subject: SDP 12-06 COTTAGE ROW APARTMENTS The engineering department has completed its review of the project. The engineering department is recommending that the project be approved, subject to the following conditions: Engineering Conditions NOTE: Unless specifically stated in the condition, all of the following conditions, upon the approval ofthis proposed development, must be met prior to approval of a building permit. General 1. Prior to hauling dirt or construction materials to or from any proposed construction site within this project, developer shall apply for and obtain approval from, the city engineer forthe proposed haul route. 10. Developer shall install sight distance corridors at all street intersections and driveways in accordance with City Engineering Standards. The property owner shall maintain this condition. Fees/Agreements 12. Developer shall cause property owner to execute and submit to the city engineer for recordation, the city's standard form Geologic Failure Hold Harmless Agreement. 13. Developer shall cause property owner to execute and submit to the city engineer for recordation the city's standard form Drainage Hold Harmless Agreement. 22. Prior to approval of any grading or building permits for this project, developer shall cause owner to give written consent to the city engineer for the annexation of the area shown within the boundaries of the site plan into the existing City of Carlsbad Street Community & Economic Development - Land Development Engineering 1635 Faraday Ave. I Carlsbad, CA 92008 I 760-602-2740 I 760-602-1052 fax I www.carlsbadca.gov Page 1 of 15 Lighting and Landscaping District No. 1 and/or to the formation or annexation into an additional Street Lighting and Landscaping District. Said written consent shall be on a form provided by the city engineer. Grading 32. Developer shall comply with the city's Stormwater Regulations, latest version, and shall implement best management practices at all times. Best management practices include but are not limited to pollution control practices or devices, erosion control to prevent silt runoff during construction, general housekeeping practices, pollution prevention and educational practices, maintenance procedures, and other management practices or devices to prevent or reduce the discharge of pollutants to stormwater, receiving water or stormwater conveyance system to the maximum extent practicable. Developer shall notify prospective owners and tenants ofthe above requirements. 35. Developer shall complete and submit to the city engineer a Project Threat Assessment Form (PTAF) pursuant to City Engineering Standards. Concurrent with the PTAF, developer shall also submit the appropriate Tier level Storm Water Compliance form and appropriate Tier level Storm Water Pollution Prevention Plan (SWPPP) as determined by the completed PTAF all to the satisfaction ofthe city engineer. Developer shall pay all applicable SWPPP plan review and inspection fees per the city's latest fee schedule. 39. Developer shall incorporate measures with this project to comply with Standard Stormwater Requirements per the city's Standard Urban Stormwater Management Plan (SUSMP). These measures include, but are not limited to: 1) reducing the use of new impervious surfaces (e.g.: paving), 2) designing drainage from impervious surfaces to discharge over pervious areas (e.g.: turf, landscape areas), 3) and designing trash enclosures to avoid contact with storm runoff, all to the satisfaction ofthe city engineer. Page 2 of 15 CITY OF CARLSBAD REVIEW AND COMMENT MEMO DATE: DECEMBER 21. 2012 PROJECT NO{S): SDP 12-06 REVIEW NO: 1 PROJECT TITLE: COTTAGE ROW APARTMENTS APPLICANT: JACK HENTHORN TO: m • • • • • • • • Land Development Engineering Police Department-J. Sasway Fire Department - Greg Ryan Building Department - Will Foss Recreation - Mark Steyaert Public Works Department (Streets) - Nick Roque Water/Sewer District Landscape Plancheck Consultant - PELA School District North County Transit District - Planning Department Sempra Energy-Land Management Caltrans (Send anything adjacent to 1-5) Parks/Trails - Liz Ketabian •^ALWAYS SEND EXHIBITS FROM: PLANNING DEPARTMENT Please review and submit written comments and/or conditions to the PLANNING TRACKING DESK in the Planning Department at 1635 Faraday Avenue, bv 01/11/2013. Ifyou have "No Comments," please so state. If vou determine that there are items that need to be submitted to deem the application "complete" for processing, please immediatelv contact the applicant and/or their representatives (via phone or e-mail) to let them know. Thank you . . COMMENTS: ^ Cz^fi^<St(f<, ^ ^ ^l^P/^^ pt^i/dr^j drJle- ryle^^J Signature PLANS ATTACHED Date Review & Comment 05/11 CITY OF CARLSBAD Police Department www.carlsbadca.gov Date: Dec. 28, 2012 To: Planning Tracking Desk- Planning Department From: Jodee Sasway, Crime Prevention Specialist and Public Information Officer Police Department Subject: Cottage Row Apartments - SDP 12-06 Plan Review Recommendations Carlsbad Police Department's Crime Prevention Unit has provided the following optimal security recommendations. The purpose of this document is to safeguard property and public welfare by regulating and reviewing the design, construction, quality of materials, use and occupancy, location, and maintenance of ail buildings and structures. The standards used in this document represent model international standards. Crime Prevention through Environmental Design The proper design and effective use ofthe built environment can lead to a reduction in the fear and Incidence of crime and an improvement in the quality of life. The proper design influences this by positively affecting human behavior. The design includes the physical environment, the planned behavior of people, the productive use of space and an effective crime/loss prevention program. Natural Surveillance 1. Place and design physical features to maximize visibility. This will include building orientation, windows, entrances, walkways, landscape trees and shrubs, fences and any other physical obstruction. 2. Design the placement of persons, common areas or activities to maximize surveillance possibilities. 3. Design lighting that provides for appropriate nighttime illumination of walkways, entrances and driveways. Natural Access Control 1. Use walkways, pavement, lighting and landscaping to clearly guide guests to and from selected entrances. 2. Use real or symbolic barriers like fences or landscaping to prevent and or discourage access to or from dark and or unmonitored areas. Provisions for territorial reinforcement 1. Use pavement treatments, landscaping and fences to define and outline ownership or property. Show clean transformation between public and private space. Lighting 1. Illuminate all vehicular drive surfaces, open parking areas and carports with a minimum maintained 1 foot- candle of light at ground level during the hours of darkness. 2. Put carport lights, patio lights and entrance lights on dusk to dawn sensors or timers to ensure illumination. 3. Illuminate all exterior common area pedestrian walkways and recreation areas with a minimum maintained 0.25 foot-candle of light at ground level during the hours of darkness. 4. Illuminate cluster mailboxes and trash enclosures located on the exterior with a minimum maintained 1 foot- candle of light, measured within a five-foot radius at ground level, during the hours of darkness. ^ 2560Orion Way, Carlsbad, CA 92010-7240 T 760-931-2100 F 760-931-8473 0 5. Illuminate recessed areas of building or fences, which have a minimum depth of two feet, a minimum height of five feet, and do not exceed 6 feet in width and are capable of human concealment with a minimum maintained 0.25 foot-candles of light at ground level during the hours of darkness. This requirement applies to defined recessed areas that are within 6 feet of the edge of designated walking surface with an unobstructed pathway to it, not hindered by walls or hedgerow landscaping a minimum of two feet in height. 6. Protect accessible luminaries with vandal resistant light fixtures when they are not less than three feet in height from the walking surface when used to illuminate walkways and a minimum of 78 inches in height above the driving surface when illuminating surfaces associated with vehicles. Light fixtures shall be deemed accessible if mounted within 15 feet vertically or 6 feet horizontally from any accessible surface or any adjoining roof, balcony, landing, stair tread platform or similar structure. Landscaping 1. Plan a landscaping design that enhanced surveillance and security. 2. Tree canopies should be no lower than six (6) feet and should not allow access to roofs or balconies. 3. Ensure landscaping plan does not deter from lighting and addressing. 4. Plant only low profile shrubs that can be maintained below two (2) feet. 5. Use security plants where necessary to prevent entering and tampering. 6. Install walls and fences that are see-through and enhance surveillance. 7. Install lockable gates that allow surveillance. 8. Keep entranceways clear of clutter. Addressing 1. Locate numerals where they are clearly visible from the front street. 2. Contrast the numeral's color to the background on which it is affixed. 3. Numerals shall be no less than four (4) inches in height and illuminated during the hours of darkness. 4. There should be positioned at each entrance of a multiple family dwelling complex with more than four buildings, an illuminated diagrammatic representation of the complex, which depicts the location of the viewer and the unit designations within the complex. It should be lighted during the hours of darkness. Storage Sheds a. Design storage sheds with normal doors installed as specified below with deadbolt locks and reinforced strike plates. b. Reinforce the wall area around the door c. Use hinge pins or another deterrent on the hinges of out swinging doors. Entrances 1. Allow front entrance design to provide vision from the front door to the access street. 2. Keep entranceways clear of clutter. Doors 1. Do not use of glass within 42 inches of a locking device. 2. Install wooden doors of solid core construction with a minimum thickness of one and three-fourths (1-3/4) inches. This includes the garage pedestrian door to the outside and the door from the garage into the residence. 3. Equip all doors with a single cylinder dead-bolt lock using a 5-pin tumbler. Connect the deadbolt to the inner portion ofthe lock by connecting screws. Ensure the lock has a one-inch throw that can withstand a cutting tool attack. Choose a deadbolt that embeds at least three-fourths of an inch into the strike plate. strike Plates 1. Reinforce all deadbolt strike plates. Choose strike plates constructed of a minimum 16 U.S. gauge steel, bronze, or brass and secure it to the jamb by a minimum of two screws, which should penetrate at least two (2) inches into the solid backing beyond the surface to which the strike is attached. 2. Reinforcement of the door area around the lock is also recommended. Viewer 1. Arrange entrance doors so that the occupant has a view of the area immediately outside the door without opening the door. Except doors requiring a fire protection rating that prohibits them, such a view may be provided by a door viewer having a field of view of not less than 190 degrees. Mounting height should not exceed fifty-four (54) inches from the floor. Window and sliding glass doors 1. Ail exterior sliding glass doors and windows should be equipped with locking devices which wili keep the sliding panel of the door or window from being opened from the outside horizontally or vertically lifted. Keying 1. Upon occupancy by the owner, each single unit in a tract constructed under the same general plan, should have locks using combinations that are interchange free from locks used in all other separate dwellings. Mail Boxes 1. Locate mailboxes in highly visible areas adjacent to common areas. This information is a representation of information gathered on a national level. The purpose is to provide effective and consistent information. Ifyou would like additional assistance concerning building security or employee security issues, please contact the Crime Prevention Unit at (760) 931-2105. Reviewed by Jodeene R. Sasway Crime Prevention Specialist and Public Information Officer Carisbad Police Department Jodee.saswav@carisbadca.KOv or 760-931-2195 Christer Westman From: Bob Ebert <bre1187@gmail.com> Sent: Friday, August 09, 2013 8:42 AM To: Christer Westman Cc: Mays, Traci; Ebert, Bob Subject: New information regarding the Cottage Row Apartments Hello Christer, We met at the past Planning Commission meeting involving the status change of the Conditional Use Permit for the Cottage Row Apartments. Thank you being very informative and helpful. You indicated that you would keep the Shorepointe neighbors informed at the very beginning of any new development plans for the area of the Cottage Row Apartments. We have major problems with the preliminary plans that City Ventures presented to the neighbors (higher density of homes/congestion/noise, elimination of what is now the major access road- Flame Tree Lane, and forcing all traffic though Mariposa Road). This kind of density creep downgrades the quality of on one of Carlsbad's great neighborhoods. If you become aware of anv tvpe of land use change planned for the Cottage Row Apartment area please contact the following people so that the Shorepointe neighbors may have input into the process from the beginning. 1. Bob Ebert (brel 187@,gmail.com, 760-908-8583) 2. Tracy Mays, Shorepointe Project Manager, (traci@grgmgmt.com, 760-720-0900) Please let me know that you have received this email. Thank you for your help. Bob Ebert V (CARLSBAD Community & Economic Development www.carlsbadca.gov August 9, 2013 Jack Henthorn PO Box 237 Carlsbad CA 92018 SUBJECT: NOTICE OF RESTRICTION - SDP 12-06/PUD 13-01 COTTAGE ROW APARTMENTS Dear Applicant: Please find the enclosed Notice of Restriction that needs to be signed, notarized, and returned for recordation. This is to fulfill a condition of approval of the Site Development Plan SDP 12-06 and Planned Development Permit PUD 13-01. Please ensure the following items are addressed prior to returning the Notice of Restriction: ^ Correct Notary Acknowledgement Required (Effective Januarv 1. 2008. all Certificates of Acknowledgement used by a California notarv on a document that will be recorded in the State of California must NOT HAVE "PERSONALLY KNOWN TO ME" in the acknowledgement. (Assembly Bill 886, Chapter 399)) ^ Document must be properly notarized. Name on signature page and name on Notarial Acknowledgement must match. ^ Property owner's signatures/initials must be the same as on Notary Acknowledgement. ^ Notary seal cannot be blurry/too light (County will not record the document if any portion of the Notary Seal is blurry or too light) ^ Include property owner's name in the designated space above the owner's signature. ^ Please pay particular attention to the signature requirements at the bottom ofthe signature page. It is our goal to assist you in getting the Notice of Restriction recorded as expeditiously as possible. If you have any questions or need additional assistance, please contact Michele Masterson, Senior Management Analyst at (760) 602-4615 or via email at michele.masterson@carlsbadca.gov. Sincerely, Christer Westman Senior Planner c: Michele Masterson, Senior Management Analyst File Copy Planning Division 1635 Faraday Avenue, Carlsbad, CA 92008-7314 T 760-602-4600 F 760-602-8559 Ac.vo. ^ ^ FILE COPT ViCARLSBAD Community & Economic Development www.carlsbadca.gov July 16, 2013 Jack Henthorn & Associates P 0 Box 237 Carlsbad CA 92018-0237 SUBJECT: SDP 12-06/PUD 13-01 - COTTAGE ROW APARTMENTS The preliminary staff report for the above referenced project will be sent to you via email on Wednesday, July 24, 2013, after 8:00 a.m. This preliminary report will be discussed by staff at the Development Coordinating Committee (DCC) meeting which will be held on July 29, 2013. A twenty (20) minute appointment has been set aside for you at 10:00 a.m. If you have any questions concerning your project you should attend the DCC meeting. It is necessary that you bring the following required information with you to this meeting or provide it to your planner prior to the meeting in order for your project to go forward to the Planning Commission: 1. Unmounted colored exhibit(s) of your site plan and elevations; and 2. A PDF of your colored site plan and elevations. The colored exhibits must be submitted at this time to ensure review by the Planning Commission at their briefings. If the colored exhibits are not available for their review, vour proiect could be rescheduled to a later time. The PDF of your colored site plan and elevations will be used in the presentation to the Planning Commission and the public at the Planning Commission Hearing. If you do not plan to attend this meeting, please make arrangements to have your colored exhibit(s) and the PDF here by the scheduled time above. Should you wish to use visual materials in your presentation to the Planning Commission, they should be submitted to the Planning Division no later than 12:00 p.m. on the day of a Regular Planning Commission Meeting. Digital materials will be placed on a computer in Council Chambers for public presentations. Please label all materials with the agenda item number you are representing. Items submitted for viewing, including presentations/digital materials, will be included in the time limit maximum for speakers. All materials exhibited to the Planning Commission during the meeting (slides, maps, photos, etc.) are part of the public record and must be kept by the Planning Division for at least 60 days after final action on the matter. Your materials will be returned upon written request. If you need additional information concerning this matter, please contact your Planner, Christer Westman at (760) 602-4614. Sincerely, DON NEU, AICP City Planner DN:CW:bd File Copy Project Engineer Planning Division 1635 Faraday Avenue, Carlsbad, CA 92008-7314 T 760-602-4600 F 760-602-8559 ® Christer Westman From: Danielle K Miller <dkmiller1@roadrunnercom> Sent: Monday, July 29, 2013 9:55 PM To: Christer Westman Subject: RE: SDP 12-096/PUD 13-01 I really appreciate your prompt reply. I've shared the clarification about the Project Proposal to many other concerned neighbors and we're now aware of the process for the public hearing. The description attached to the notice of public hearing sites many codes that we're unfamiliar with, but are willing to do research to understand. If I put it in layman's terms, it seems simple that they want to first lift a rental restriction (from faith based to "open" market). Makes sense, except they don't currently rent at the Cottage Row apartments based on faith (?)and by all accounts is openly accessible to being rented by general public. In fact, they seem to cater to many folks that have undergone treatment at the Project Walk spinal cord facility in Carisbad (we've had the pleasure of meeting some of these folks). Am I missing something in the intent to lift a restriction that isn't in current practice? From: Christer Westman [mailto:Christer.Westman@carisbadca.qov1 Sent: Wednesday, July 24, 2013 7:46 AM To: Danielle K Miller Subject: RE: SDP 12-096/PUD 13-01 Good morning, The project being processed through the City that was the subject of the early public notice is just as it was described. There has been no change. The property owner has, on their own, been marketing the property for sale. One of the interested parties, on their own, has contacted adjacent residents to get feedback regarding a development they would consider if they were to purchase the property. There is no formal application pending with the City. We too are reviewing their considered development to provide them feedback. We do have subdivision maps on file that illustrate property lines and we have copies of Assessor's Parcel Maps that also show property lines. In order to be absolutely certain of property line location, one must locate the property markers that should exist on the ground and/or have a licensed surveyor locate the property boundaries. Christer Westman AICP Senior Planner .A CITY OF CARLSBAD Planning Division 1635 Faraday Ave Carisbad CA 92008 Phone: 760-602-4614 From: Danielle K Miller rmailto:dkmillerl@roadrunner.com1 Sent: Tuesday, July 23, 2013 8:16 PM To: Christer Westman Subject: SDP 12-096/PUD 13-01 Hi Christer- Eariier, we received your early public notice about modifications to the Cottage Row Apartments (reference subject line for Project Number). We were not overiy concerned about the project description you provided as it was simply to modify rental restrictions. You can imagine our surprise when we were contacted by a developer that there are plans to redevelop that entire area with what appears to be three story homes! Please confirm what this project is all about and who we need to work through. Also, a few years ago we were advised that the owner believed their property line extended farther than it does (suggesting that they own some of our adjacecent land). How do I get official City of Carisbad property maps in advance of any type of dispute? Thank you Danielle Miller Calmeria Place :k Henthorn & Associaf P.O. Box 237 Carlsbad, California 92018-0237 (760) 438-4090 Fax (760) 438-0981 July 12, 2013 Mr. Christer Westman City of Carlsbad Planning Department \ 5 20^3 RECEWED 1635 Faraday Avenue 01 QRAD Carisbad, California 92008 PITY OF CAKLOlS/^'-' PLANNING DIVISION RE: Cottage Row - SDP 12-06/PUD 13-01 - constraints mSppfng Dear Mr. Westman: Enclosed please find updated site constraints mapping. The updated mapping is based on extensive research of the City files related to the history of the site dating back to 1980. The original 1980 approvals granted to the Sudan Interior Mission included a Conditional Use Permt (CUP 190), tentative tract map (CT 80-44) and grading plan. The original approval included an orchard on the eastern portion ofthe property which was disrupted during the construction of Aviara Parkway. This previously graded area is included in the site yield calculations. In March of 1981 the planning commission authorized an amendment to the previously approved grading plan to accommodate up to 5 additional duplexes subject to approval of an amendment to the CT and CUP prior to the start of construction of any additional buildings. Shortly after the Planning Commission's 1981 authorized revision to the grading, the owner requested that the City Engineer waive the recording of a final subdivision map subject to compliance with ali other conditions applicable to the original approvals. Upon fulfillment of the conditions, all necessary permits were issued. In 1988 a land swap occurred between the developer of the subdivision to the south and the Sudan Interior Mission to offset the impacts associated with the construction of Aviara Parkway. The boundary of the SIM parcel was adjusted southerly by 80 feet and the eastern boundary was adjusted westerly to accommodate the required right of way for Aviara Parkway. In 1996 the swap area was graded in conjunction with the development ofthe subdivision to the south resulting in the existing improved site configuration. The constraints map has been fully updated and the existing developed area has been adjusted to include all areas listed above. The remaining undeveloped portion of the site has been evaluated pursuant to CMC 21.90 (Growth Management) and CMC 21.53.230 (Uses Generally). 1902 Wright Place, Ste 200, Carisbad, CA 92008 The maximum potential unit yield was calculated using the GMCP and the rounding provisions of 21.53.230 (e). The enclosed mapping indicates a GMCP based maximum yield of 33 units. The upper limit of he RLM General Plan designation would permit up to 41 units. If you have any questions or need additional information, please contact me at your convenience. ^ry truly yours. SDP 12-06/PUD 13-01 SLOPE ANALYSIS SLOPE RANGE PLJ^N AREA (ACRES) 1 10-15% 0.3 AC 1 1 15-25% 0.2 AC nZD 25-40% 1.3 AC H 40%-VERTICAL 1.3 AC / / .' / / ' / ( ' I ' > I 40 0 ao 120 SCALE r- 40' HUNSAKER &. ASSOCIATES i A N D I I C (X IMC SLOPE ANAL YSIS/CONSTRAINTS COTTAGE ROW CITY OF CARLSBAD, CALIFORNIA SHEET 1 OF 1 CTY OF nFILE VCARLSBAD Uiril-t Planning Division www.carlsbadca.gov March 13, 2013 Jack Henthorn & Associates Attn: Jack Henthorn PO Box 237 Carisbad, CA 92018-0981 SUBJECT: 1'* REVIEW FOR SDP 12-06/PUD 13-01 - COTTAGE ROW APARTMENTS Thank you for applying for Land Use Permits in the City of Carisbad. The Planning Division has reviewed your Site Development Plan and Planned Development Permit, application no. SDP 12-06/PUD 13-01, as to its completeness for processing. The application is complete, as submitted. Although the initial processing of your application may have already begun, the technical acceptance date is acknowledged by the date of this communication. The City may, in the course of processing the application, request that you clarify, amplify, correct, or otherwise supplement the basic information required for the application. In addition, you should also be aware that various design issues may exist. These issues must be addressed before this application can be scheduled for a hearing. The Planning Division will begin processing your application as of the date ofthis communication. At this time, the City asks that you provide 4 complete sets ofthe development plans so that the project can continue to be reviewed. The Citv will complete the review of vour resubmittal within 25 davs. In order to expedite the processing of your application, you are strongly encouraged to contact your Staff Planner, Christer Westman, at (760) 602-4614, to discuss or to schedule a meeting to discuss your application and to completely understand this letter. You may also contact each commenting department individually as follows: • Land Development Engineering Division: David Rick, Associate Engineer, at (760) 602-2781. • Fire Department: Gregory Ryan, Fire Inspections, at (760) 602-4661. Sincerely, CHRIS DeCERBO Principal Planner if CD:CW:sm c: Cottage Row Carlsbad, LLC, PO Box 2194, Newport Beach, CA 92659 Don Neu, City Planner N David Rick, Project Engineer Chris DeCerbo, Principal Planner File Copy Data Entry W 1635 Faraday Avenue, Carlsbad, CA 92008-7314 T 760-602-4600 F 760-602-8559 © Henthorn & Associi P.O. Box 237 Carisbad, California 92018-0237 (760) 438-4090 Fax (760) 438-0981 December 20,2012 Mr. Don Neu, City Planner City of Carisbad Planning Department 1635 Faraday Avenue Carisbad, California 92008 RE: College Row Apartments (formerly SIM) SDP approval request In June of 2007, the Sudan Interior Mission was granted a CUP amendment (CUP 190(B)) to allow the existing CUP to be transferred with the ownership of the property to effectuate a sale to a buyer who anticipated bringing in another faith-based retirement group to occupy the facility. The subject site was approved initially in 1980 as a faith-based retirement village consisting of 22 duplex units and one pre-existing single family unit using the conditional permit process. Subsequently, one single family unit was added bringing the total to the current day 24 units. Several unsuccessful attempts were made to locate another faith based user during the past 5 years. The conclusion drawn from these efforts is that faith-based organizations are impacted by the same issues related to retirement plans as are found in the broader economy. Retirement housing plans, defined benefit plans, etc. are being phased out due to economic realities. The owner is requesting that the City rescind the CUP which would allow the site to operate pursuant to provisions in the Residential Low Medium land use designation and the site development plan approved as required by the Qualified overiay zone (Q) as currently applied to the property. The property is designated as Residential Low Medium (RLM) in the City's General Plan. While this designation normally accommodates single family detached housing, there is recognition that certain sites containing significant sensitive resources as identified in the City of Carlsbad's Habitat Management Plan, may be developed with product types other than single family detached housing. The subject site contains 12.1 acres ofwhich 8 acres are slopes and undeveloped areas. The 8 acres of slopes and undeveloped area includes 4 acres of high quality Coastal Sage habitat, a sensitive resource under the City's Habitat Management Plan. This area has been managed by the ownership ofthe site and is proposed to continue into the future. The existing development has been analyzed via an as built site plan in the context of current day standards. As shown on the attached Site Development Plan package, the development meets current day development standards for multi-family residential product. The growth management control point yield on the site is 26.5. The maximum potential yield is 33.2 units. There are currently 24 units located on the site as noted above. 1902 Wright Place, Ste 200, Carisbad, CA 92008 Therefore, the operation ofthe units does not require a CUP in that, current regulations would allow the development of apartments on this site with the approval of a Site Development Plan. I would appreciate an opportunity to meet with the planner ultimately assigned to the project eariy in the application review process. Very truly yours. cc: Russel Radach Lex Williman M. Murray K. Beadle