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HomeMy WebLinkAbout20190114_ApplicationCommunity Development Department Planning Permit Application 1. Check Permits Requested: D Approval-in-Concept -AIC # Iii Coastal Development Permit D Lot Merger D Limited Term Permit - D Waiver for De Minimis Development D Seasonal O < 90 day 0>90 days D Coastal Residential Development D Modification Permit D Condominium Conversion D Off-Site Parking Agreement D Comprehensive Sign Program D Planned Community Development Plan D Development Agreement D Planned Development Permit D Development Plan Iii Site Development Review -Iii Major D Minor D Lot Line Adjustment D Parcel Map 2. Project Address(es)/Assessor's Parcel No(s) 12902 W. Coast Highway/APN 049-110-19 100 Civic Center Drive Newport Beach, California 92660 949 644-3200 newportbeachca.gov/communitydevelopment D Staff Approval D Tract Map Iii Traffic Study Iii Use Permit -DMinor li!Conditional D Amendment to existing Use Permit D Variance D Amendment -DCode DPC DGP DLCP D Other: 3. Project Description and Justification (Attach additional sheets if necessary): The project proposes to establish a fine dining restaurant with a partially-covered, second level outdoor terrace within an existing building located at 2902 W. Coast Highway. Please see attached sheet. 4. Applicant/Company Name Phil Edmondson/Pacific Coast Architects M .1. Add \2600 Newport Boulevard a1 mg ress C·ty !Newport Beach ________ J Suite/Unit l;:s=ui=te=1=1=4 ====j State jcalifornia I Zip 192663 I ---------- Phone 1949-675-9468 J Fax ,___ __ _ __ _,, Email IPCA@pacificcoastarchitects.net 5. Contact/Company Name Susan Hori/Manatt, Phelps & Phillips, LLP M .1. Add 1695 Town Center Drive, 14th Floor S ·t /U ·t J a1 mg ress m e m ________ _ City lcosta Mesa ---·--·-State t~~-lifornia J Zip 192626 J Phone Fax f 14-3_!~257~ __ ] Email ls~~~@manat:=~ _________________ J 6. Owner Name "---;=:======================;·-----------;=======: Mailing Address Suite/Unit lsuite 200 =1 City !Newport Beach _ State lcalifomia ~ Zip 192660 Phon~ 1949-698-1596 ______ ~ Fax ________ ] Email jkcrowley@~~-~~tie.c~~--------------------- 7. Property Owner's Affidavit*: (I) (We)'---------------·------------·--·-------------------------------------......, depose and say that (I am) (we are) the owner(s) of the property (ies) involved in this application. (I) 0,Ne) further certify, u er penalty o perjury, that the foregoing statements and answers herein contained and the information herewith itted ar all respects true and correct to the best of (my) (our) knowledge and belief. ( I Signature(s): -----=----------Title: ---------~ Date: ~-----------~ *May be signed by the lessee or by an authorized agent if written authorization from the owner of record is filed concurrently with the application. Please note, the owner(s)' signature for ParcelfTract Map and Lot Line Adjustment Application must be notarized. F:\Users\CDD\Shared\Admin\Planning_Division\Applications\Application_Guidelines\Planning Penni! Application -CDP added.docx Rev: 01124117 1 2902 West Coast Highway Project Description and Letter of Justification Project Description The project proposes to establish a fine dining restaurant with (1) a main level with an interior bar/lounge area and (2) a partially-covered, second level outdoor terrace with a separate bar/lounge and seating area (the “Project”) located at 2902 West Coast Highway (“Project Site”). The Project Site is a single parcel totaling approximately 14,026 square feet. The Project Site is occupied by an approximately 9,478.72 square feet (gross floor area) existing building which will be retained and re-purposed for restaurant use and other retail. The gross floor area of the proposed Project is approximately 7,705 square feet. The Project Site is surrounded by existing commercial uses, including Sterling BMW and restaurants. The Project Site is located more than 320 feet from the nearest residential structure. The Project Site is located on the inland side of West Coast Highway and is separated from Newport Harbor by West Coast Highway and private property currently occupied by multi-story commercial buildings. The Project is within the coastal zone and is subject to the City’s Local Coastal Program. The City’s General Plan designates the Project Site as Mixed Use Horizontal 1 (MU- H1). The City’s Coastal Land Use Plan (“CLUP”) designates the site as Mixed Use Horizontal. The coastal zoning district is Mixed Use – Mariners’ Mile (MU-MM). These land use and zoning designations permit development of properties fronting on West Coast Highway with freestanding commercial uses, including food service uses with alcohol service. The General Plan, for instance, notes that the Mariners’ Mile area presents an opportunity for reuse of underperforming properties for visitor-serving uses. (General Plan Policies LU 3.3 and LU 6.19.4.) The proposed Project would be consistent with the General Plan’s and CLUP’s vision for Mariners’ Mile by providing additional visitor-serving and neighborhood serving uses in this area which facilitates and increases public access to the coastal zone. The restaurant would include 5,052 square feet of net public area1, comprised of (1) 2,517 square feet of first level net public area and (2) 2,535 square feet of net public area on the second level outdoor terrace.2 A total of 213 seats would be provided, with seating for 112 and 101 people provided on the main floor and the outdoor terrace, respectively. The Project Site is bordered by West Coast Highway to the south, existing commercial buildings to the north, the China Palace restaurant to the east, Enterprise Car Rental to the west, and the U.S. Post Office to the northwest. The proposed restaurant would have a zero foot 1 “Area, net public” is defined at Newport Beach Municipal Code (“NBMC”) Section 21.70.020 as the total area used to serve customers, including customer sales and display areas, customer seating areas, service counters and waiting areas, but excludes restrooms, kitchens, offices, storage and other similar areas. 2 For purposes of parking, the total net public area is 4,423 square feet, which deducts 25% of the total net public area of the outdoor dining terrace, consistent with NBMC Section 21.40.040. 2 setback from the property to the west, a 7-foot setback on the south frontage, and approximately 10-foot setbacks along the east and northern frontages. The building would be constructed to a maximum height of 31 feet to the peak of the wood trellis and outdoor terrace bar roof, which extends approximately 11 feet from the finished floor of the outdoor terrace. The Project proposes a limited elevator overrun that would extend to a maximum height of 32 feet 3 inches. Because the Project Site is located within the Shoreline Height Limit Area which does not provide height exceptions for elevator overruns, the Project requests an increase in the maximum height allowed to accommodate the elevator shaft overrun. The requested 32 feet 3 inch maximum height is below the maximum height limit (35 feet) authorized by the Shoreline Height Limit Area (NBMC Section 21.30.060(C). The elevator enclosure would occupy approximately 80 square feet of rooftop area. The restaurant is thoughtfully designed to offer patrons a variety of options to suit the occasion, such as communal or more intimate seating options. The design also incorporates an inside courtyard with trees and other greenspace elements, as well as the outdoor terrace that allows patrons to enjoy food and/or drinks under the stars. The restaurant, which would serve both food and alcohol, is proposed to open at 10:00 AM Monday-Thursday, and 9:00 AM Friday-Sunday, and will provide continual food service (breakfast, lunch, dinner, after-dinner) until closing. Service hours are expected to continue past 11:00 PM. The menu would include a wide variety of fine dining options. Any alcohol service would be subject to compliance with the strict licensing requirements of the California Department of Alcoholic Beverage Control. A maximum of approximately 15 to 24 employees are anticipated to be working at the restaurant during normal business hours, depending upon the time of day. All employees will utilize off- site parking. For purposes of parking, the Project’s anticipated parking is considered in conjunction with the parking spaces and uses existing within the Garden, the existing shopping center within which the Project Site is located. The Garden currently has a total of 123 parking spaces available for use by existing and future tenants, including the Project. With the Project, all employees of The Garden, including employees associated with the proposed restaurant, would be required to park off-site at the to-be-constructed 215 Riverside Avenue (“215 Riverside”) building, which would be located approximately 250 feet from the Project Site. When completed, 215 Riverside will have approximately 3,000 square feet of general office uses and 48 total parking spaces. 12 of the parking spaces will be required to serve the office uses, but the remainder spaces (36) will be available for parking employees of The Garden. If the Project commences operation prior to the completion of 215 Riverside, alternative off-site parking sufficient to accommodate parking of all employees will be secured in the interim. Required Entitlements 1. Coastal Development Permit to permit the restaurant use and height limit exceedance. 2. Conditional Use Permit for restaurant use with late hours, accessory alcohol service, and parking plan. 3. Site Development Review for the height limit exceedance. 4. Operator License 5. Traffic Study 3 The Planning Commission is the municipal body with authority to review and approve all of the entitlements, except the Operator License, which is issued by the Chief of Police. The Chief of Police’s approval of the Operator License may be appealed to the City Manager. All Planning Commission approvals may be appealed to the City Council. 4 Letter of Justification Coastal Development Permit (NBMC Section 21.52.015) The Project is within the Coastal Zone and, therefore, requires approval of a coastal development permit (“CDP”). Finding 1 The project conforms to all applicable sections of the certified Local Coastal Program. Facts in Support of Finding 1. The 2902 West Coast Highway building proposes a maximum gross floor area of approximately 8,452 square feet. Although the maximum FAR permitted by the Local Coastal Program (“LCP”) is 0.5 FAR (7,013 square feet), the Project Site is occupied by an existing building which consists of approximately 9,478.72 square feet of floor area and is considered a non-conforming structure as to permitted floor area. (NBMC Section 21.38.030.C.) The City’s LCP permits changes to non-conforming structures if the alterations do not increase the degree of nonconformity. (NBMC Section 21.38.040.D.) The Project will be located in the existing building and will consist of approximately 7,705 gross square feet of floor area. Therefore, because the proposed Project is being constructed within an existing nonconforming structure, would not exceed the existing square footage and would not increase the degree of nonconformity, the Project is consistent with the cited provisions of the City’s LCP. Although the proposed square footage would exceed the maximum FAR for the applicable zone, the building is permitted up to the existing 9,478.72 square feet of floor area. 2. The restaurant building complies with the setback requirements of the NBMC, which are zero feet on the front, sides, and rear lot lines. 3. The Project would contribute to the CLUP’s vision for a vibrant Mariners’ Mile by establishing a unique visitor-serving and neighborhood-serving restaurant to the area. (CLUP at 2-9.) The renovation of the existing building will support local establishments within Mariners’ Mile and improve the pedestrian landscape. 4. The restaurant is designed with a high level of architectural quality and is compatible with other buildings in the immediate vicinity, as well as those within the larger Mariners’ Mile area. The design includes activation of the streetscape, including through the installation of outdoor trellises and arched windows with views into the restaurant. 5. The Project is consistent with CLUP Policy 2.3.1-1, which specifically permits visitor- serving eating and drinking establishments in commercial areas. 5 6. The Project would facilitate access to the Newport Bay waterfront by drawing patrons to the restaurant and the area, which would in-turn support existing and future businesses along the waterfront, including boat rentals, or providing people already enjoying the waterfront with a unique dining opportunity. 7. The Project’s maximum structural height of its trellised roof complies with the maximum height allowed in the MU-H1 zoning district of 31 feet for a sloped roof. The elevator shaft is 32 feet 3 inches in height which can be permitted with approval of a site development review and CDP and would still be less than the 35 feet maximum allowed under the Shoreline Height Limit Area (NBMC Section 21.30.060(C). 8. The Project’s orientation and design, particularly the outdoor terrace, integrates visual and physical pedestrian access to the Newport Bay waterfront and creates a cohesive connection between the restaurant and surrounding uses. 9. Project buildings incorporate different material and articulation to create contrast and a pleasing visual aesthetic. 10. The outdoor terrace would improve the visual landscape of the building from Newport Heights by designing the outdoor space with aesthetic architectural features, such as limited landscaping elements, as opposed to typically mechanical equipment. 11. The Project Site is visible from West Coast Highway, a coastal view road (per the General Plan). However, the Project Site is located north of West Coast Highway and would not obstruct any Newport Bay views from West Coast Highway. Therefore, the Project is consistent with the General Plan and the CLUP’s polices related to protection of coastal views from West Coast Highway. (e.g., CLUP Policy 4.4.1-6.) 12. A public viewpoint is also located northwest of the Project Site, from the public park located along Cliff Drive. The Project will be established within an existing building on a site already improved with parking lots, structures and landscaping. The Project’s limited outdoor terrace uses would not obstruct or damage views of Newport Bay from the public park because (1) the park is substantially higher than the Project Site and located approximately 350 feet from the Project Site, and (2) the buildings immediately across West Coast Highway (along the Newport Bay waterfront) are taller than the maximum height of the Project. 13. The parking areas, access points, and on-site circulation are designed to provide adequate drive aisles and minimum vehicle turning areas to provide safe access for guests, emergency vehicles, and refuse collection vehicles. 14. The establishment of an unique restaurant at the Project Site will have a positive impact on overall economic health of the community and promote further revitalization of other commercial and mixed-use properties in the area. 6 15. The nearest sensitive uses, residences located along Cliff Drive, are located more than 400 feet from the edge of the outdoor terrace and roof and architectural elements. Like the Cliff Drive park, the residences are also perched upon the cliff, which is substantially higher than the Project Site. Therefore, the Project’s outdoor dining component would not generate noise that would negatively impact such sensitive uses. Finding 2 The project conforms with the public access and public recreation policies of Chapter 3 of the Coastal Act if the project is located between the nearest public road and the sea or shoreline of any body of water located within the coastal zone. Facts in Support of Finding 1. The Project would not conflict with the Coastal Act’s public access and public recreation policies because (1) it is located in an already existing building, (2) would not obstruct access to Newport Bay or the waterfront, (3) is served by adequate parking, and (4) would contribute to pedestrian activation of the area, which would ultimately facilitate access to the waterfront. Site Development Review (NBMC Section 20.52.080(F) and Height Limit Exceedance (NBMC Section 21.30.060(C)(3) and Section 20.30.060(C)(3)) The Project would be constructed to a maximum height of 31 feet, but for the elevator shaft overrun that allows for handicapped access, which will be constructed to 32 feet 3 inches. Because the maximum height for pitched roof structures is 31 feet, the elevator shaft overrun requires the approval of a minor height increase. This height increase is necessary to permit use and activation of the restaurant’s outdoor terrace, which facilitates patrons’ views of and access to Newport Bay. NBMC Section 21.30.060(C)(3) Findings Finding 1 The project is sited and designed to protect public views to and along the ocean and scenic coastal areas. Facts in Support of Finding 1. The Project Site has frontage on West Coast Highway, a coastal view road, as designated by the General Plan. However, the frontage is on the north site of West Coast Highway and, therefore, would not obstruct any views of Newport Bay from any coastal view road. 2. A designated public view point exists northwest of the Project Site at the public park on Cliff Drive. However, that view point is located approximately 450 feet from the Project Site and is substantially elevated above the Project Site. The outdoor dining terrace, which includes 7 limited projections, would not negatively impact existing views from this public view point because existing buildings located along the Newport Bay waterfront are taller than the proposed Project. 3. The Project would enhance views of the Project Site from nearby bluff-top residences by introducing architectural elements, such as landscaping, to the existing building’s rooftop. This would be an improvement over the traditional HVAC and other mechanical equipment that usually occupies a building rooftop. 4. The Project would increase public views of Newport Bay by constructing an outdoor dining terrace that affords patrons limited views of the waterfront (along with the greater Mariners’ Mile area). Finding 2 The project is sited and designed to minimize visual impacts and be visually compatible with the character of surrounding areas. Facts in Support of Finding 1. The Project has been designed to ensure that potential conflicts with surrounding land uses are minimized to the extent possible to maintain a healthy environment for both businesses and residents by providing an architecturally pleasing project with articulation and building elements that enhance the urban environment. 2. The Project is part of a cohesive, already existing commercial center, which is designed to accommodate and provide safe access for emergency vehicles, delivery trucks, and refuse collection vehicles, as well as pedestrians. 3. The restaurant will not necessitate high levels of lighting or illumination. However, new sources of light and illumination will be established with the outdoor dining terrace. All exterior lighting will comply with NBMC Section 20.30.070, which requires that all outdoor lighting fixtures be designed, aimed, located, and maintained to shield adjacent properties from light spillage. 4. The Project’s architectural elements, including trellises, plantings, large windows, and variation of materials, promote a strong and inviting pedestrian orientation that will contribute to the revitalization of the area. 5. The Project will strengthen the core “Mariner’s Village” area by establishing a neighborhood-serving restaurant complimentary to existing uses, consistent with the Mariners’ Mile Strategic Vision and Design Plan. Finding 3 Where feasible, the project will restore and enhance visual quality in visually degraded areas. 8 Facts in Support of Finding 1. The Project Site is not considered visually degraded. The restaurant would be part of a larger integrated commercial area – The Garden – which includes other commercial uses and is subject to recent revitalization. 2. The restaurant building is designed consistent with the Mariners’ Mile Strategic Vision and Design Plan. Per Section 1.30 of the Mariners’ Mile Strategic Vision and Design Plan, the Project is within the “Mariner’s Village” area, which is identified as an area presenting a unique opportunity “for the creation of an active pedestrian-oriented retail district” capable of serving adjacent neighborhoods, visitors and existing marine uses. The Project will further this goal by contributing to The Garden, an integrated, well-designed commercial center. 3. Through the development of the outdoor terrace, the Project will replace standard rooftop mechanical equipment with more aesthetically pleasing architectural features, such as landscaping and sloped-roof shade structures. 4. The increased pedestrian activity associated with the Project, particularly the activation of the streetscape and outdoor spaces, will further contribute to the revitalization of the area, consistent with the goals of the General Plan and CLUP. Finding 4 Where the project is located in the Shoreline Height Limitation Zone, the project will not exceed thirty-five (35) feet. Facts in Support of Finding 1. The Project Site is within the Shoreline Height Limitation Zone, and will not exceed 35 feet in height. NBMC Section 21.30.060(C)(3) Findings Finding 1 The project applicant is providing additional project amenities beyond those that are otherwise required. Examples of project amenities include, but are not limited to: i. Additional landscaped open space. ii. Increased setback and open areas. iii. Enhancement and protection of public views. 9 Facts in Support of Finding 1. The renovation of the 2902 West Coast Highway building, which is independent of the Project, reduces the overall square footage of the building by removing a section of the existing building and incorporating a 405 square foot outdoor courtyard. 2. The Project, but for the one-foot three-inch height increase associated with the elevator overrun, would be consistent with the applicable height limitations outlined in the NBMC. The Project, even with the limited height increase, would be shorter than adjacent development projects, including the buildings located directly across West Coast Highway from the Project Site. Thus, the Project does not negatively impact any public views of Newport Bay through construction of any obstructions. Moreover, the Project would contribute new views of the Mariners’ Mile area and of Newport Bay by establishing a second floor outdoor dining terrace. Finding 2 The architectural design of the project provides visual interest through the use of light and shadow, recessed planes, vertical elements, and varied roof planes. Facts in Support of Finding 1. Project buildings incorporate different material and articulation to create contrast and a pleasing visual aesthetic. 2. The design includes activation of the streetscape through the installation of outdoor trellises and arched windows with views into the restaurant. 3. The Project would replace existing unsightly mechanical rooftop equipment with pitched trellis structures and landscaping, creating a more pleasing visual aesthetic from area views while not obstructing views of Newport Bay. 4. The Project’s architectural elements include trellises, plantings, large windows, and use of varying materials that will promote a strong and inviting pedestrian orientation that will contribute to the revitalization of the area. 5. The 2902 building incorporates different materials, including wood, stone, metal, and plantings to create contrast and a pleasing visual aesthetic, consistent with surrounding commercial uses and the Mariners’ Mile Design Guidelines. Finding 3 The increased height will not result in undesirable or abrupt scale changes or relationships being created between the proposed structure(s) and existing adjacent developments or public spaces. Where appropriate, the proposed structure(s) provides a gradual transition to taller or shorter structures on abutting properties. 10 Facts in Support of Finding 1. The structures located immediately across West Coast Highway from the Project Site, including 2901 and 2801 West Coast Highway are both three-stories, which is taller than the maximum height of the Project (32 feet 3 inches) and the prevailing height of the Project (31 feet). Thus, the Project creates a pleasing visual transition in height away from Newport Bay by reducing height compared with nearby structures. 2. The elevator overrun, which is to be constructed to 32 feet 3 inches, is only one foot and three inches taller than the pitched bar roof and trellis structures located on the second floor outdoor dining terrace. Because the elevator is setback from the building’s frontage along West Coast Highway, it appears similar in scale to the permitted, 31-foot trellis and roof structure which are located closer to West Coast Highway. 3. The Project’s outdoor dining terrace and elevator overrun would be largely obstructed by other outdoor dining terrace and roof features. Likewise, the outdoor dining terrace and rooftop will not diminish any significant views of the Newport Bay waterfront from nearby public areas. Finding 4 The structure will have no more floor area that could have been achieved without the approval of the height increase. Facts in Support of Finding 1. The 2902 building will have no greater floor area than could have been achieved without the approval of the height increase. The 2902 building, as proposed to be renovated independent of the Project, actually results in a reduction of approximately 1,026 square feet from the existing building. Thus, with the Project, the building is actually substantially reducing the overall square footage below existing, permitted levels. NBMC Section 20.52.080(F) Findings Finding 1 The proposed development is allowed within the subject zoning district. Facts in Support of Finding 1. The Project’s proposed restaurant use is permitted in the MU-MM zoning district. 11 Finding 2 The proposed development is in compliance with all of the applicable criteria in NBMC Section 20.52.080(C)(2)(c). a. Compliance with this Section, the General Plan, this Zoning Code, any applicable specific plan, and other applicable criteria and policies related to the use or structure. b. The efficient arrangement of structures on the site and the harmonious relationship of the structures to one another and to other adjacent developments; and whether the relationship is based on standards of good design. c. The compatibility in terms of bulk, scale, and aesthetic treatment of structures on the site and adjacent developments and public areas. d. The adequacy, efficiency, and safety of pedestrian and vehicular access, including drive aisles, driveways, and parking and loading spaces. e. The adequacy and efficiency of landscaping and open space areas and the use of water efficient plant and irrigation materials. f. The protection of significant views from public right(s)-of-way and compliance with Section 20.30.100 (Public View Protection). Facts in Support of Finding 1. The Project is consistent with applicable zoning and the General Plan, both of which designate the Project Site for visitor and neighborhood serving commercial uses. The Project Site is not subject to an adopted Specific Plan or Planned Community. 2. The Project contributes to the creation of a corridor that reflects and takes advantage of its location near the Newport Beach waterfront and exhibits a quality visual image for travelers on West Coast Highway. (General Plan Goal LU 6.19.) 3. The Project facilities pedestrian connection and activity within Mariners’ Mile, including to Newport Bay, consistent with the Mariner’s Mile Strategic Vision & Design Framework and the General Plan. 4. The building’s FAR and building footprints comply with the NBMC’s provisions governing non-conforming structures, and actually constitute a reduction in the permitted square footage. 5. The Project’s outdoor dining area would be within the height limits established by the NBMC and would not obstruct existing Newport Bay views from public parks or nearby 12 residences. The outdoor dining area’s design elements would replace traditional rooftop mechanical features with more aesthetically pleasing architectural elements. 6. The height, bulk, and scale of the 2902 West Coast Highway building and the Project’s proposed outdoor terrace are comparable to the height limits on nearby properties within the immediate Mariners’ Mile area, which includes multiple two and three story buildings such as 3000 West Coast Highway (two stories), 2801 West Coast Highway (three stories), 2901 West Coast Highway (three stories), 3101 West Coast Highway (three stories), 3121 West Coast Highway (six-plus stories), and 3333 West Coast Highway (five stories). 7. The Project’s outdoor dining terrace and architectural elements provide variation within The Garden and immediately surrounding buildings. 8. The 2902 West Coast Highway building will incorporate different materials including wood, stone, metal, and plantings to create contrast and a pleasing visual aesthetic, consistent with the surrounding commercial uses in The Garden development. The outdoor dining terrace likewise includes plantings and architectural elements consistent with The Garden. 9. The restaurant’s design elements and pedestrian orientation will enhance the Project’s frontage of West Coast Highway, and will connect residents and visitors to The Garden development, the Newport Bay waterfront, and the greater Mariners’ Mile area. This will further facilitate vehicle independence and pedestrian use of nearby resources. 10. All parking areas, access points, and on-site circulation are designed to provide adequate drive aisles and minimum vehicle turning areas to provide safe access for residents and guests, emergency vehicles, and refuse collection vehicles. 11. The Project is subject to the City’s Water-Efficient Landscape requirements and compliance will be confirmed at plan check prior to issuing building permits. Finding 3 The proposed development is not detrimental to the harmonious and orderly growth of the City, nor endangers, jeopardizes, or otherwise constitutes a hazard to the public convenience, health, interest, safety, or general welfare of persons residing or working in the neighborhood of the proposed development. Facts in Support of Finding 1. The Project has been designed to ensure that no potential conflicts with surrounding land uses would occur and to maintain a healthy environment for both businesses and area residents by providing an architecturally pleasing Project with articulation and building elements that enhance the urban environment. 2. The General Plan, zoning, and the CLUP envision the Mariners’ Mile area as developed with residential and visitor serving commercial uses, including dining establishments. The Project 13 would facilitate the creation of a village-environment (including at The Garden and the greater Mariners’ Mile area) that is inviting to nearby residents and visitors alike. 3. The Project Site is served by drive aisles and parking that provide safe access for emergency vehicles, delivery trucks, and refuse collection vehicles, as well as pedestrians. 4. All trash storage and pick-up will be consistent with the requirements of NBMC Section 20.30.120 (Solid Waste & Recyclable Materials Storage), ensuring compatibility with the on- site and adjacent uses. 5. While the Project would generate new sources of light, the Project Site is currently developed with existing uses that also generate light and is located in the heavily developed Mariners’ Mile corridor. Also, all exterior project lighting is required to comply with NBMC Section 20.30.070, which requires that all outdoor lighting fixtures be designed, aimed, located, and maintained to shield adjacent properties from light spillage. 6. The Project does not introduce uses that would involve the use or manufacture of any hazardous substances that could impact nearby commercial or residential development. Conditional Use Permit for (1) Shared Parking, (2) Alcohol Sales Findings (NBMC Section 20.48.030), and (3) Food Service With Late Hours To accommodate restaurant parking, the Project will (1) share parking with other, non- competing uses at The Garden and (2) utilize off-site parking at 215 Riverside (for employees of the Project). A conditional use permit is required to permit the joint use of parking spaces at The Garden and the use of off-site parking spaces. The restaurant would include alcoholic beverage sales, necessitating the approval of a conditional use permit, and late hours food service. Finding 1 The use is consistent with the General Plan and any applicable specific plan. Facts in Support of Finding 1. The Project is consistent with applicable zoning and the General Plan, both of which designate the site, particularly the West Coast Highway frontage, for commercial uses. The Project Site is not subject to an adopted Specific Plan or Planned Community. 2. The Project proposes a restaurant at 2902 West Coast Highway, which is permitted by the MU-H1 designation and MU-MM zoning of the site. 3. The Project will contribute to the creation of a pedestrian-friendly commercial district, accessible to area residents and visitors, which will promote access to the waterfront and achieve the goals outlined by the Mariners’ Mile Strategic Vision and Design Plan for the site area. 14 4. The restaurant will serve upland residential neighborhoods, consistent with General Plan Policy LU 6.19.4, by providing a restaurant space near the waterfront and other commercial uses. 5. The Project contributes to the creation of a corridor that reflects and takes advantage of its location near the Newport Beach waterfront by increasing pedestrian views of and access to the waterfront, and exhibits a quality visual image for travelers on West Coast Highway. (General Plan Goal LU 6.19.) 6. The Project would contribute to the revitalization of Mariners’ Mile by establishing a unique restaurant with accessibility to other amenities of the area and an outdoor terrace allowing patrons views of Newport Bay. 7. The Project will facilitate pedestrian connection and activity near the waterfront of Newport Bay, consistent with the Mariner’s Mile Strategic Vision & Design Framework and the General Plan. The Strategic Vision’s goal for Mariner’s Village area of the Mariners’ Mile includes a more human-scale streetscape with inviting street furnishings, functional sidewalks, and local-serving tenants such as upscale markets, cafes, and specialty retail uses. A restaurant at this location helps to establish and improve upon a local-serving and visitor- serving environment, enhancing the character of the area, and providing a complementary commercial use as intended within the Mariner’s Village core. 8. The Project’s parking is conveniently located to serve the restaurant, with approximately 123 shared stalls available within The Garden commercial center. 9. All employees of The Garden, including the Project, will park off-site at 215 Riverside, thus further reducing parking demand at The Garden and ensuring adequate parking to serve all uses, including the Project. Finding 2 The use is allowed within the applicable zoning district and complies with all other applicable provisions of this Zoning Code and the Municipal Code. Facts in Support of Finding 1. The use is allowed within the applicable zoning district, which permits development of properties fronting on Coast Highway with freestanding commercial uses, including food service uses with alcohol service. Finding 3 The design, location, size, and operating characteristics of the use are compatible with the allowed uses in the vicinity. 15 Facts in Support of Finding 1. The restaurant is compatible with the surrounding uses of the area, which include retail, automobile sales, restaurants, and other commercial uses. 2. The Project will contribute to the revitalization of the area, particularly the creation of an integrated commercial center – The Garden – located at West Coast Highway and Riverside Avenue. 3. The CLUP envisions the Mariners’ Mile corridor as a series of distinct retail, mixed-use, and visitor-serving centers. The Project contributes to achievement of this vision by providing a restaurant that facilitates the creation of a pedestrian-oriented environment, as well as providing new opportunities to experience coastal views. 4. The Project will provide parking adequate to serve the restaurant through shared parking and non-conflicting peak hours with other uses in the surrounding commercial center, as well as off-site parking. 5. The main point of access to the restaurant would be from West Coast Highway. However, there are three additional points of ingress and egress to The Garden, including two along Avon Street and two on Riverside Avenue. These access points are sufficient to provide safe pedestrian and vehicular access to the Project. 6. As discussed above, the Project’s proposed outdoor terrace would not negatively impact public or private views in the area. 7. The Mariner’s Mile Strategic Vision & Design Framework identifies the Project Site area as to be developed with a human-scale streetscape with functional sidewalks and local-serving tenants such as restaurants and retail uses. A restaurant at this location helps to establish and improve the existing neighborhood-serving amenities in the area, thus enhancing the character of the area. Finding 4 The site is physically suitable in terms of design, location, shape, size, operating characteristics, and the provision of public and emergency vehicle (e.g., fire and medical) access and public services and utilities. Facts in Support of Finding 1. The Project provides access for emergency and non-emergency vehicles as required by the NBMC. 2. The restaurant is projected to have peak operating hours that will not compete with other uses, including retail, existing or planned for The Garden. Thus, the parking and access 16 available at The Garden (and directly to the restaurant) will not create any conflicts with existing or proposed uses. 3. Appropriate sight distance is provided at each driveway. The Project’s parking areas, access points, and on-site circulation are designed to provide adequate drive aisles and minimum vehicle turning areas to provide safe access for guests, emergency vehicles, and refuse collection vehicles. 4. The Project complies with the applicable standards (including FAR and setbacks) of the General Plan and NBMC, ensuring compatibility with adjacent development. Finding 5 Operation of the use at the location proposed would not be detrimental to the harmonious and orderly growth of the City, nor endanger, jeopardize, or otherwise constitute a hazard to the public convenience, health, interest, safety, or general welfare of persons residing or working in the neighborhood of the proposed use. Facts in Support of Finding 1. The Project has been designed to ensure that potential conflicts with surrounding land uses are minimized to the extent possible to maintain a healthy environment for both businesses and residents by providing an architecturally pleasing project with articulation and building elements that enhance the urban environment. 2. The Project’s buildings were designed to accommodate and provide safe access for emergency vehicles, delivery trucks, and refuse collection vehicles, as well as patrons and pedestrians. 3. The restaurant would introduce a new visitor and neighborhood-serving use into an area (Mariners’ Mile) intended for revitalization through the establishment of a resident and pedestrian-friendly environment close to jobs, commerce, entertainment, and recreation. 4. All exterior lighting is required to comply with NBMC Section 20.30.070, which requires that all outdoor lighting fixtures be designed, aimed, located, and maintained to shield adjacent properties from light spillage. 5. Mariners’ Mile is intended to be a regional commercial, neighborhood- and visitor-serving destination. The restaurant, including its alcoholic beverage sales, is a commercial use intended to serve visitors, residents, and employees of the broader Mariners’ Mile and, therefore, is consistent with the General Plan, zoning, and the CLUP. 6. The proposed outdoor dining terrace, and associated architectural elements, promote a more human-scale streetscape by engaging patrons with the West Coast Highway frontage and nearby public places, and contributes to a more functional, pedestrian oriented sidewalk along West Coast Highway. 17 7. The Project will have a positive impact on the overall economic health of the community and may promote further revitalization of the other commercial properties within the Mariners’ Mile area. Finding 6 The use is consistent with the purpose and intent of Zoning Code Section 20.48.030 (Alcohol Sales). i. The crime rate in the reporting district and adjacent reporting districts as compared to other areas in the City. ii. The numbers of alcohol-related calls for service, crimes, or arrests in the reporting district and in adjacent reporting districts. iii. The proximity of the establishment to residential zoning districts, day care centers, hospitals, park and recreation facilities, places of worship, schools, other similar uses, and any uses that attract minors. iv. The proximity to other establishments selling alcoholic beverages for either off-site or on-site consumption. v. Whether or not the proposed amendment will resolve any current objectionable conditions. Facts in Support of Finding 1. The Project is within Reporting District 25, which has a higher crime rate than the citywide average. However, the higher crime rate is attributable to the high number of visitors to Mariners’ Mile, as opposed to other areas of the City, and the high ratio of non-residential to residential uses. The Project would introduce a use that is consistent with those existing in the Mariners’ Mile area (restaurants and other commercial uses), and would operate consistent with the requirements of the CUP, as well as the Operator License, as approved by the Chief of Police, and any conditions contained therein. Moreover, the restaurant is proposed as a fine dining establishment. 2. The restaurant includes lighting consistent with NBMC, which will deter crime activities in the area. Likewise, the Project is a component of a larger commercial center – The Garden – which is also illuminated consistent with applicable standards. 3. The Project will enhance the pedestrian experience within the area and along the street as a result of new landscaping and the restaurant design, e.g., architectural windows facing the street, that will serve as a further deterrent to crime in the area. 18 4. The Project’s proposed alcohol sales is accessory to, and consistent with, the restaurant use. The floor plan, hours of operation, and operational characteristics of the proposed restaurant, including alcoholic beverages sales, are typical of restaurants operating in destination areas of the City. 5. The subject property is located in a mixed-use district that permits residential development. However, the restaurant is located within an already-developed parcel as a component of a larger commercial center. The areas immediately surrounding the property along West Coast Highway are likewise developed with commercial uses. 6. The nearest sensitive uses include the park and residences located on Cliff Drive, more than 300 feet from the restaurant. There are intervening structures and uses that buffer the park and residences from the Project. 7. Mariners’ Mile is generally characterized by a high number of visitors, both from inside the Newport Beach community and outside, and restaurants with alcohol service are anticipated amenities within the Mariners’ Mile. 8. There are other food and alcohol service establishments within the vicinity of the Project. However, that is expected within the Mariners’ Mile, which is intended for the establishment of visitor-serving restaurant uses, among other things. Mariners’ Mile is a popular tourist and resident destination, and the Project will contribute to the creation of a “village” environment that further revitalizes the area. 9. There are currently no objectionable conditions at the Project Site that need to be resolved. 10. The service of alcohol is intended for the convenience of customers dining at the restaurant. Operational conditions of approval relative to the sale of alcoholic beverages will help ensure compatibility with surrounding uses and minimize alcohol related impacts. 11. The restaurant use is located within a developed commercial center – The Garden – and area – Mariners’ Mile – designated and zoned to include such development. The General Plan and zoning permit eating and drinking establishments, and recognize Mariners’ Mile as a resident and visitor destination with uses intended to serve those patrons. 12. The restaurant is located in a highly-traveled commercial area that is occupied by a mixture of office, retail, and general commercial uses. It is anticipated that the Project will serve visitors, residents, and employees of nearby offices businesses within the Mariners’ Mile and surrounding areas. Adding alcohol service to the menu will complement the food service and provide for the convenience of customers. Late Hours Operation (NBMC § 20.48.090(F)(3)(a) The restaurant, which would serve both food and alcohol, is proposed to open at 10:00 AM Monday-Thursday, and 9:00 AM Friday-Sunday, and will provide continual food service (breakfast, lunch, dinner, after-dinner) until closing. Service hours are expected to continue past 19 11:00 PM. Therefore, due to the late hours of operation (after 11:00 PM) and because the restaurant will include alcoholic beverage sales, an Operator License must be approved by the City’s Chief of Police, as required by NBMC Chapter 5.25. Additionally, when considering a permit to allow restaurant eating and drinking establishments to operate with late hours, the review authority must consider potential impacts on adjacent or nearby uses Finding 1 The review authority shall consider the following potential impacts upon adjacent or nearby uses: i. Noise from music, dancing, and voices associated with allowed indoor or outdoor uses and activities. ii. High levels of lighting and illumination. iii. Increased pedestrian and vehicular traffic activity during late night and early morning hours. iv. Occupancy loads of the use. v. Any other factors that may affect adjacent or nearby uses. Facts in Support of Finding 1. The restaurant, which would serve both food and alcohol, is proposed to open at 10:00 AM Monday-Thursday, and 9:00 AM Friday-Sunday, and will provide continual food service (breakfast, lunch, dinner, after-dinner) until closing. Service hours are expected to continue past 11:00 PM. Therefore, due to the late hours of operation (after 11:00 PM), approval of an Operator License by the Newport Beach Police Department will be required. An Operator License required pursuant to NBMC Chapter 5.25 may be subject to additional and/or more restrictive conditions to regulate and control potential nuisances associated with the operation of the restaurant, at the discretion of the City’s Police Chief. The Operator License will help ensure compatibility of the proposed business with the surrounding uses in the vicinity. 2. All lighting at the Project Site will comply with the standards of the NBMC. The nearest residences are located more than 400 feet from the edge of the outdoor terrace, which will be a source of light. However, the significant distance between the terrace and residences, and compliance with all lighting requirements, will ensure that lighting will not impact those residences. Also, the Project Site fronts on West Coast Highway, a major thoroughfare in the City, and a source of substantial ambient light. The Project’s lighting will not markedly increase ambient light in the vicinity. 3. Mariners’ Mile is a well-established commercial area. The Project would introduce a new restaurant consistent with the goals of the General Plan and zoning for Mariners’ Mile, particularly establishing a pedestrian friendly environment that facilitates access and use of 20 Newport Bay. The Project would not substantially increase vehicular traffic to the area or create traffic that would be inconsistent with the goals of Mariners’ Mile. All of the nearest sensitive uses, particularly the residences along Cliff Drive, are separated from Mariners’ Mile and its circulation system by bluffs and other natural features. Also, there are multiple major points of ingress and egress from the Project Site and Mariners’ Mile, including Coast Highway and Newport Boulevard. With such access, it is not anticipated that patrons of the restaurant would travel through residential neighborhoods, including during late night or early morning hours. As such, traffic from the restaurant will not impact sensitive receptors. 4. No live entertainment, dancing, or other significant source of noise is proposed with the Project, either inside or outside. 320501582.5 Secretary of State Statement of Information (Limited Liability Company) 47 IMPORTANT-Read instructions before completing this form. Filing Fee • $20.00 Copy Fees -Face Page $1.00 & .50 for each attachment page; Certification Fee -$5.00 LLC-12 FILED Secretaf'Y of Sta~e State of Catifom1a OCT \ 7 20\6 This Space For Office Use Only 3. State or Place of Organization (only if formed outside of California) 4. Busln8S8 Actdresses a. Street Addres, of Principal Off1ce -Do not list a P.O. Box City (no abbreviabons) State Zip C:oda 2220 Uni•:ersity Drive Newport Beach CA 92660 b. Malling Address of LLC, If different than Item 4a City (l'\O abbreviations) State Zip Code c. Street Address of C.llfornla Office, if Item 4a Is not In Calltoma • Do not list a P.O. Box City (no abbreviations) Stat11 Zip Code CA 5. Manager(s) or Member(s) If no managers have been appOinted or elected, provide the nam& and address of each member. At least one name !!llt address must be listod. If the manager/member is an individual. complete Items 5a and 5c (teave Item 51> 1>1ank). If the manager/member is an entity, complete Items Sb and 5c Oeave Item 5a blank). Note: The LLC cannot sel'Ve as its own manager or member. If Iha LLC has additional managers/members, enter the name(s) eind addresses en Form LLC-12A (see Instructions). a. F!nil. Name, If an Individual -Do not complete Item 5b ! Middle Name ! LastName I sumx b. Entity Name • Do not complete Item 5a . Gary Jabara ~ c. Address , . , .. .... ,a _, -. . . ·I City (l'\O abbrevfallons) " ' . . . I State I Zip Code . ' 2220 University Drive· -· Newport Beach CA 92660 6. Agent for Service of Process Item &a and 6b: If the agent is an Individual, the agent mu$! reside in California and Item 6a and 6b must be (X)mpleted with the agent's name and California address. Item 6c: If the agent is a California Regislered Corporafa Agent, a current agent registration certificate must be on file with the California Secrete of State and Imm 6c must ba com leted leave Item 6a-6b blank . a. California Agenra First Name (if agent is net a corporation) Middle Name b. Street Address (If agi,nt is not a ccrporatiQo) -Do not HIit a P.O. Box City (no abbreviations) c. California Registered Corporate Agent's Name (If agent la a ~oration) -Do not complete item 6a or 6b Corporation Service Company IJ.J\1oeh wfhdo b6{rQz:6 fn 'ttbvn,'"a.. 7. Type of Business a. Describe the type of business or HNlcea of the Limited Liability Company Real estate holding company 8. Chief Executive Officer, If elected or appolnte!I a. Fir,t Name Middle Name Last Name Suffi~ Last Name Suffix b. Address City (no abbreviations) Zip Code 9. The Information contained herein, Including any attachments, Is true and correct 8}00 } J {p Gary Jabara _M_a_n_ag_er __ _ Date Type or Print Name of Person Completing the FolTTI TIUe Return Address (Optional) (For communication from the Secretary of State related to this docu·ment,-or if purchasing a copy of the filed oc ' person or company and the mailing address. This informetion will become public when filed. SEE INSTRUCTION'S BEFO Name: f . . 1 Company: Address: City/State/Zip: L J LLC-12 (REV 0712016) CAOBI -7/26120l6 Woltm Kluwer Online 2016 Caifomia Seaetary of State www.sos.ca.gov/business/be Page 1 Rev. NAT 8/15/15 Order No. 92002-1581896-18 3090 Bristol Street, Suite 190 Costa Mesa, California 92626 Office Phone: (949)419-9400 Office Fax: Email: titleteam@nat.com Key Escrow Your Ref: 450 Newport Center Drive, Suite 150 Our Order No.: 1581896 Newport Beach, CA 92660-7621 Property Address: 2902 West Coast Highway, Newport Beach, California Attention: Brandi Rivera ______________________________________________________________________________ Preliminary Report Dated as of July 17, 2018 at 7:30 A.M. In response to the above referenced application for a Policy of Title Insurance, First American Title Insurance 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 below or not excluded from coverage pursuant to the printed Schedules, Conditions and Stipulations of said Policy forms. The printed Exceptions and Exclusions from the coverage and limitations on covered risks of said Policy or Policies are set forth in Exhibit A attached. 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 Exhibit A. Copies of the Policy forms should be read. They are available from the office which issued this report. Please read the exceptions shown or referred to below and the exceptions and exclusions set forth in Exhibit A 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 preliminary 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. 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 form of Policy of title insurance contemplated by this report is: ALTA Standard Owner Policy Please note that the America First Homeowner's Policy (CLTA/ ALTA Homeowner's Policy) can only be issued on transactions involving individuals as purchasers and residential 1-4 properties. Any indication that the America First Homeowner's Policy (CLTA/ ALTA Homeowner's Policy) will be issued in a transaction that does n ot meet these criteria is hereby revised to state that the policy contemplated is a Standard Coverage Policy. David Neal, Title Officer Page 2 Rev. NAT 8/15/15 Order No. 92002-1581896-18 SCHEDULE A 1. The estate or interest in the land hereinafter described or referred to covered by this report is: A fee as to Parcel(s) 1, an easement as to Parcel(s) 2. 2. Title to said estate or interest at the date hereof is vested in: THE GARDEN M2, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY 3. The Land referred to in this report is situated in the City of Newport Beach State of California, County of Orange, and is described as follows: See attached Legal Description Page 3 Rev. NAT 8/15/15 Order No. 92002-1581896-18 LEGAL DESCRIPTION Real property in the City of Newport Beach, County of Orange, State of California, described as follows: PARCEL 1: THE SOUTHWESTERLY 280.53 FEET OF THE NORTHWESTERLY 50 FEET (SAID 50 FEET BEING MEASURED ALONG STATE HIGHWAY) OF THAT PORTION OF LOT F OF TRACT NO. 919, AS PER MAP RECORDED IN BOOK 29, PAGES 31 TO 34 INCLUSIVE, OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT A POINT ON THE SOUTHWESTERLY LINE OF SAID LOT AT THE MOST WESTERLY CORNER OF THAT PORTION OF SAID LOT CONVEYED TO M. M. GALBRETH BY DEED RECORDED JUNE 23, 1937 IN BOOK 290, PAGE 281 OF OFFICIAL RECORDS, SAID POINT BEING IN A LINE WHICH IS PARALLEL WITH AND 110 FEET NORTHWESTERLY, MEASURED AT RIGHT ANGLES, FROM TH E SOUTHEASTERLY LINE OF SAID LOT; THENCE FROM SAID POINT OF BEGINNING NORTH 28 DEG. 59' 30" EAST ALONG SAID PARALLEL LINE TO AN INTERSECTION WITH THE NORTHEASTERLY LINE OF SAID LOT; THENCE NORTHWESTERLY ALONG SAID NORTHEASTERLY LINE OF SAID LOT, 94.35 FEET TO THE MOST EASTERLY CORNER OF THAT PORTION OF SAID LOT CONVEYED TO J. H. GORDEN AND WIFE BY DEED RECORDED AUGUST 16, 1939 IN BOOK 1011, PAGE 61 OF OFFICIAL RECORDS; THENCE SOUTH 28 DEG. 59' 30" WEST ALONG THE SOUTHEASTERLY LINE OF SAID PORTION OF SAID LOT CONVEYED BY SAID LAST MENTIONED DEED TO AN INTERSECTION WITH THE SOUTHWESTERLY LINE OF SAID LOT, AND THENCE SOUTH 61 DEG. 00' 30" EAST ALONG SAID LAST MENTIONED LINE OF SAID LOT, 94.15 FEET TO THE POINT OF BEGINNING. PARCEL 2: AN EASEMENT FOR INGRESS AND EGRESS OVER, ON AND ACROSS THE FOLLOWING DESCRIBED REAL PROPERTY, DESCRIBED AS FOLLOWS: THAT PORTION OF LOT F, OF TRACT NO. 919, DESCRIBED AS FOLLOWS: SHOWN ON A MAP RECORDED IN BOOK 29, PAGES 31 TO 34 INCLUSIVE, OF MISCELLANEOUS MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA: BEGINNING AT A POINT IN THE SOUTHEASTERLY LINE OF SAID LOT "F", DISTANT THEREFROM 130 FEET NORTHEASTERLY FROM THE NORTHERLY LINE OF THE STATE HIGHWAY, AS GRANTED TO THE STATE OF CALIFORNIA BY DEED RECORDED JULY 12, 1929, IN BOOK 311, PAGE 170 OF OFFICIAL RECORDS IN THE OFFICE OF THE COUNTY RECORDER OF SAID ORANGE COUNTY, AND RUNNING THENCE NORTH 61 DEG. 00' 30" WEST 154.15 FEET TO THE SOUTHEASTERLY LINE OF THE LAND DESCRIBED IN THE DEED FROM W. T. JEFFERSON TO ANDRE J. DUROCHER AND WIFE, DATED APRIL 18, 1945, RECORDED JULY 2, 1945 IN BOOK 1321, PAGE 17 OF OFFICIAL RECORDS OF ORANGE COUNTY, CALIFORNIA; THENCE NORTH 28 DEG. 59' 30" EAST ALONG SAID SOUTHEASTERLY LINE, 30 FEET; THENCE SOUTH 61 DEG. 00' 30" EAST 154.15 FEET TO THE SOUTHEASTERLY LINE OF SAID LOT "F"; THENCE SOUTH 28 DEG. 59' 30" WEST 30 FEET ALONG THE SOUTHEASTERLY LINE OF SAID LOT "F", TO THE POINT OF BEGINNING. APN: 049-110-19 Page 4 Rev. NAT 8/15/15 Order No. 92002-1581896-18 SCHEDULE B At the date hereof exceptions to coverage in addition to the printed exceptions and exclusions in the policy form designated on the face page of this report would be as follows: 1. General and special taxes and assessments for the fiscal year 2018-2019, a lien not yet due or payable. 2. Taxes for proration purposes only for the fiscal year 2017-2018. First Installment: $30,067.78, PAID Second Installment: $30,067.78, PAID Tax Rate Area: 07-001 APN: 049-110-19 3. Supplemental taxes for the year 2017-2018 assessed pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation Code. First Installment: $15,689.55, PAIDWPEN Penalty: $1,568.95 Second Installment: $15,689.56, PAID Penalty: $1,591.95 Tax Rate Area: 07-001 A. P. No.: 049-110-19.0100 4. The lien of an assessment or assessments made under the 1915 Bond Act, which assessment(s) are collected with the ad valorem real property taxes. 5. The lien of supplemental taxes, if any, assessed pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation Code. 6. Water rights, claims or title to water, whether or not shown by the public records. 7. The terms and provisions contained in the document entitled Declaration of Establishing Access and Parking Easements, executed by and between Riverpoint Properties, LTD., a General Partnership and John P. Hooten and Janet D. Hooten, husband and wife, recorded January 29, 1980, in Book 13484, Page 726 of Official Records. 8. We find no open deeds of trust, and will require the Open Loans Affidavit form to be submitted for review prior to close. 9. Any facts, rights, interests, or claims which are not shown by the public records but which could be ascertained by an inspection of said land or by making inquiry of persons in possession thereof. 10. Any rights, interests, or claims of parties in possession of the land not shown by the public records. Page 5 Rev. NAT 8/15/15 Order No. 92002-1581896-18 11. With respect to The Garden M2, LLC, a California limited liability company: a. A copy of its operating agreement and any amendments thereto; b. If it is a California limited liability company, that a certified copy of its articles of organization (LLC- 1) and any certificate of correction (LLC-11), certificate of amendment (LLC-2), or restatement of articles of organization (LLC-10) be recorded in the public records; c. If it is a foreign limited liability company, that a certified copy of its application for registration (LLC-5) be recorded in the public records; d. With respect to any deed, deed of trust, lease, subordination agreement or other document or instrument executed by such limited liability company and presented for recordation by the Company or upon which the Company is asked to rely, that such document or instrument be executed in accordance with one of the following, as appropriate: (i) If the limited liability company properly operates through officers appointed or elected pursuant to the terms of a written operating agreement, such document must be executed by at least two duly elected or appointed officers, as follows: the chairman of the board, the president or any vice president, and any secretary, assistant secretary, the chief financial officer or any assistant treasurer; (ii) If the limited liability company properly operates through a manager or managers identified in the articles of organization and/or duly elected pursuant to the terms of a written operating agreement, such document must be executed by at least two such managers or by one manager if the limited liability company properly operates with the existence of only one manager. e. Other requirements which the Company may impose following its review of the material required herein and other information which the Company may require 12. Unrecorded matters which may be disclosed by an Owner's Affidavit or Declaration. A form of the Owner's Affidavit/Declaration is attached to this Preliminary Report/Commitment. This Affidavit/Declaration is to be completed by the record owner of the land and submitted for review prior to the closing of this transaction. Your prompt attention to this requirement will help avoid delays in the closing of this transaction. Thank you. The Company reserves the right to add additional items or make further requirements after review of the requested Affidavit/Declaration. ********** END OF REPORT ********** Page 6 Rev. NAT 8/15/15 Order No. 92002-1581896-18 _____________________________________________________________________________________ * * * * * N O T E S * * * * * _____________________________________________________________________________________ 1. NOTICE OF RECORDING PROCEDURE Pursuant to Cal. Revenue & Tax Code §480.3, all Deeds and other Documents that reflect a change in ownership must be accompanied by a Preliminary Change of Ownership Report to be completed by the transferee. If this special report is not presented at the time of recording, an additional recording fee of $20.00, as required by law, will be charged. Preliminary Change in Ownership forms, instructions on how to complete them, and a nonexclusive list of documents that are affected by this change, are available from the County Recorder's Office or the Office of the County Assessor. Effective January 1, 2018, Cal. Government Code §27388.1 imposes an additional fee of $75.00 to be paid at the time of recording for every real estate instrument, paper, or notice required or permitted by law to record, except those expressly exempted from payment. 2. GOOD FUNDS LAW Under Section 12413.1 of the California Insurance Code, North American Title Company, Inc. may only make funds available for disbursement in accordance with the following rules: Same day availability. Disbursement on the date of deposit is allowed only when funds are deposited to North American Title Company, Inc. by Cash or Electronic Transfer (Wire). Cash will be accepted only under special circumstances and upon approval by management. Next business day availability. If funds are deposited to North American Title Company, Inc. by cashier's checks, certified checks or teller's checks, disbursement may be on the next business day following deposit. A “teller's check” is one drawn by an insured financial institution against another insured financial institution (e.g., a savings and loan funding with a check drawn against a FDIC insured bank). Second business day availability. If the deposit is made by checks other than those described in paragraphs 1 and 2 above, disbursement may occur on the day when funds must be made available to depositors under Federal Reserve Regulation CC. In most cases, these checks will be available on the second business day following deposit. (For further details, consult California Insurance Code Section 12413, et seq. and Regulation CC). These are the minimum periods before funds will be made available. North American Title Company, Inc. is not obligated to disburse funds at the expiration of the time periods above, and expressly reserves the right to require additional time before disbursing on deposited funds. Close of escrow and final disbursement will not be made based on deposits in the form of personal checks, corporate checks, credit union checks, money market checks, travelers checks and official checks until confirmation of final clearance of the funds. North American Title Company, Inc. will not be responsible for accruals of interest or other charges resulting from compliance with the disbursement restrictions imposed by state law. 3. North American Title Company, Inc.'s charges for recording the transaction documents include charges for services performed by North American Title Company, Inc., in addition to an estimate of payments to be made to governmental agencies. 4. Note: The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less than the certain dollar amount set forth in any applicable arbitration clause, all arbitrable matters Page 7 Rev. NAT 8/15/15 Order No. 92002-1581896-18 shall be arbitrated at the option of either the Company or the Insured as the exclusive remedy of the parties. If you desire to review the terms of the policy, including any arbitration clause that may be included, contact the office that issued this Commitment or Report to obtain a sample of the policy jacket for the policy that is to be issued in connection with your transaction. 5. The map attached, if any, may or may not be a survey of the land depicted hereon. North American Title Company, Inc. expressly disclaims any liability for loss or damage which may result from reliance on this map except to the extent coverage for such loss or damage is expressly provided by the terms and provisions of the title insurance policy, if any, to which this map is attached. Page 8 Rev. NAT 8/15/15 Order No. 92002-1581896-18 File Number: 92002-1581896-18 OWNER'S DECLARATION The undersigned Owner(s) of legal age, being duly sworn, deposes and states under penalty of perjury under the laws of the State of California. 1. That certain real property (the"Property") as described in that certain Commitment of Title Insurance/Preliminary Report No. 92002-1581896-18 dated as of July 17, 2018 ("Commitment/Report") issued by or on behalf of North American Title Company, Inc. ("North American Title Company, Inc.") is improved by the following (check all that apply) ☐ Single family residences ☐ One-to-four family residences ☐ Apartment building ☐ Office building ☐ Commercial building ☐ Combination office/commercial building ☐ Industrial building ☐ Vacant Land ☐ Other: _____________________ 2. WORK OF IMPROVEMENT: Please respond to A, B and C below: A. For the period of 90-days prior to the date of this Affidavit, no repairs or work of improvement has been conducted on, nor any materials supplied to, the Property except as follows: ___________________________________________________________________________ ___________________________________________________________________________ ____________________________________________________________________________ (Enter "None" if such is true.) If you have described any work of improvement above, please complete the following: ☐ Started on __________________, 20_____. ☐ Completed on _______________, 20_____. ☐ Will be completed on _____________________, 20_____. B. Cessation of Labor (Please place an "X" by 1 or 2 below): ☐ 1. There has been a cessation of labor where a work of Improvement was discontinued before completion within 150 days of the date of this Affidavit. PLEASE DESCRIBE THE NATURE OF THE WORK THAT DISCONTINUED: _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ ☐ 2. There has not been a cessation of labor where a work of improvement was discontinued before completion within 150 days of the date of this Affidavit. Page 9 Rev. NAT 8/15/15 Order No. 92002-1581896-18 C. There are no unpaid bills for labor or material because of any improvements made to the Property except: ____________________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ (Enter "None" if such is true.) 3. No one is in possession of, or has any right to possession of, the Property except: ☐ Declarant as owner. ☐ Tenants based only on month-to-month rental agreements. ☐ Tenants based upon existing leases as listed on the Rent Roll attached hereto as Exhibit A and incorporated herein by reference. ☐ Other:___________________________________________________ 4. No person(s) or entitles, have (i) any options to purchase or rights of first refusal, including but not limited to lessees under any leases referred to in Paragraph 3 above, and/or (ii) easements, licenses, agreements or other rights allowing them to use, encroach on, or access to the Property except (i) as shown in the Commitment/Report, and (ii) _____________________________________________________________________ _____________________________________________________________________ _____________________________________________________________________ (Enter "None" if such is true.) 5. Those certain lease(s) shown as exception number(s) __________ in the Commitment/Report have either: (a) expired by their own terms, or (b) if they have not expired, the lessee(s) have vacated the Property and Declarant has been notified of the vacation of the Property either by correspondence from the lessee or by physical inspection of the property. 6. To the best of Declarant's knowledge, there are no unrecorded real property taxes or assessments against the Property. The undersigned is not aware of any release reports or commitment statements which have been issued pertaining to any environmental issues or liens. 7. This Affidavit is given for the purpose of inducing North American Title Company, Inc. and its agents to issue policy(ies) of title insurance which may provide coverage with respect to all matters set forth herein. If North American Title Company, Inc. elects, in its discretion, to (a) accept this Affidavit, and (b) issue title insurance policy(ies) to third parties, North American Title Company, Inc. will do so in material reliance on this Affidavit and the representation and covenants in this Affidavit. 8. Declarant acknowledges that he/she has read this Affidavit, that all the statements made in this Affidavit are true and correct of his/her own actual knowledge, and fully understands the legal aspects of any misrepresentations or untrue statements made in this Affidavit. Declarant, both personally and on behalf of Owner, covenants and agrees to defend, indemnify, and hold North American Title Company, Inc. harmless from and against any and all claims, actions, suits (including arbitration), liabilities, losses, damages, costs, charges, attorney's fees and other expenses of every nature and character as a result of its reliance on this Affidavit. Page 10 Rev. NAT 8/15/15 Order No. 92002-1581896-18 Executed on __________________, 20______, at ___________________________, _____________________ (City) (State) "Declarant" _________________________________________________ Owner __________________________________________________ Owner A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of __________________________________ County of _________________________________ Subscribed and sworn to (or affirmed) before me on this ______________________ day of ___________________, 20____, by _________________________________________, proved to me on the basis of satisfactory evidence to be the person(s) who appeared before me. (seal) Signature __________________________________ Page 11 Rev. NAT 8/15/15 Order No. 92002-1581896-18 OPEN LOANS AFFIDAVIT Order Number: 92002-1581896-18 Escrow Number: 92002-1581896-18 __________________________________________________________ of legal age, hereby declares and swears, under penalty of perjury that the following information, declarations, representations and answers are true, correct and complete: 1. I am the current owner of the property in this transaction which has an address of: 2902 West Coast Highway, Newport Beach, CA 2. That the following is a complete and comprehensive list of all open loans taken out against said land: (If no open loans, please write NONE on the 1st Current Lender Line and initial). 1.) Current Lender: ____________________ Loan Balance $_____________ Original Lender: ____________________ Original Loan Amount: $_____________ Are you in default of this Loan: ☐ YES ☐ NO IF YES, how long ( ) MONTHS 2.) Current Lender: ____________________ Loan Balance $_____________ Original Lender: ____________________ Original Loan Amount: $_____________ Are you in default of this Loan: ☐ YES ☐ NO IF YES, how long ( ) MONTHS 3.) Current Lender: ____________________ Loan Balance $_____________ Original Lender: ____________________ Original Loan Amount: $_____________ Are you in default of this Loan: ☐ YES ☐ NO IF YES, how long ( ) MONTHS 4.) Current Lender: ____________________ Loan Balance $_____________ Original Lender: ____________________ Original Loan Amount: $_____________ Are you in default of this Loan: ☐ YES ☐ NO IF YES, how long ( ) MONTHS 3. I understand and acknowledge that this Affidavit is made for the protection and benefit of North American Title Company and for all other parties hereafter dealing with or who may acquire an interest in said Property and for the purpose of inducing North American Title Company (including its affiliates and underwriters) to insure title to said Property. I am fully aware a nd know that North American Title Company will rely on this Affidavit and would not insure title without it. We also hereby ag ree to indemnify and hold North American Title Company harmless and to become fully financially responsible for any loss that may occur to North American Title Company or any other parties if any of the information, declarations, representations and answers turn out to not be true, correct and/or complete, whether by accidental omission or actual deceit and/or fraud. Dated: ________________ BY: _________________________ BY: _________________________ Page 12 Rev. NAT 8/15/15 Order No. 92002-1581896-18 NORTH AMERICAN TITLE COMPANY 3090 Bristol Street, Suite 190 , Costa Mesa, CA 92626 (949)419-9400 Fax: Email: titleteam@nat.com Closing Protection Letters can be ordered directly by emailing cacpl@nat.com with your title order number and property address. Attention: Your Ref: Our Order No.: 92002-1581896-18 LENDERS SUPPLEMENTAL REPORT Dated as of July 17, 2018 AT 7:30 A.M. Title Officer: David Neal The above numbered report (including any supplements or amendments thereto) is hereby modified and/or supplemented in order to reflect the following additional items relating to the issuance of an American Land Title Association loan form policy of Title Insurance: Our ALTA Loan Policy, when issued, will contain Endorsement Nos. 100 and 116. There is located on said land a Commercial /Commercial Known as: 2902 West Coast Highway City of Newport Beach County of Orange State of California. According to the public records, there has been no conveyance of the land within a period of twenty-four months prior to the date of this report, except as follows: A document recorded September 1, 2016 as Instrument No. 2016000421159 of Official Records. From: WB II Properties, a California partnership To: The Garden M2, LLC, a California limited liability company Page 13 Rev. NAT 8/15/15 Order No. 92002-1581896-18 Privacy Policy Rev. 05/22/2018 North American Title Group Family of Companies FACTS WHAT DOES NORTH AMERICAN TITLE GROUP, LLC FAMILY OF COMPANIES DO WITH YOUR PERSONAL INFORMATION? Why? Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some, but not all, sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do. What? The types of personal information we collect and share depend on the product or service you have with us. This information can include:  Social Security number and income  Transaction history and payment history  Purchase history and account balances How? All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information, the reasons North American Title Group, LLC Family of Companies (“NATG”) chooses to share, and whether you can limit this sharing. Reasons we can share your personal information Does NATG share? Can you limit this sharing? For our everyday business purposes Such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus Yes No For our marketing purposes To offer our products and services to you Yes No For joint marketing with other financial companies No We don’t share For our affiliates’ everyday business purposes Information about your transactions and experiences Yes No For our affiliates’ everyday business purposes Information about your creditworthiness No We don’t share For our affiliates to market to you Yes Yes For nonaffiliates to market to you No We don’t share To limit our sharing  Visit the following webpage for full instructions and a link to the Opt Out process via our NATTRACK system: www.nat.com/Opt-Out OR  Mail the form below Please note: If you are a new customer, we can begin sharing your information 30 days from the date we sent this notice. When you are no longer our customer, we continue to share your information as described in this notice. However, you can contact us at any time to limit our sharing. Questions? Call 1 (844) 654-5408 ----------------------------------------------------------------------------------------------------------------------------------------------------- Mail-in Form If you have a joint account, your choice(s) will apply to everyone on your account unless you mark below.  Apply my choices only to me. Mark any/all you want to limit:  Do not allow your affiliates to use my personal information to market to me. Name Address City, State, Zip Account # Mail To: North American Title Group, LLC Family of Companies ATTN: General Counsel 760 Northwest 107th Avenue, Suite 400 Miami, FL 33172 Page 14 Rev. NAT 8/15/15 Order No. 92002-1581896-18 Page 2 Who we are Who is providing this notice? North American Title Group, LLC Family of Companies (identified below), which offers title insurance and settlement services and property and casualty insurance What we do How does NATG protect my personal information? To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secure files and buildings. How does NATG collect my personal information? We collect your personal information, for example, when you  Apply for insurance;  Apply for financing;  Give us your contact information  Provide your mortgage information  Show your government-issued ID We also collect your personal information from others, such as credit bureaus, affiliates, or other companies. Why can’t I limit all sharing? Federal law gives you the right to limit only  Sharing for affiliates’ everyday business purposes – information about your creditworthiness  Affiliates from using your information to market to you  Sharing for nonaffiliates to market to you State laws and individual companies may give you additional rights to limit sharing. What happens when I limit sharing for an account I hold jointly with someone else? Your choices will apply to everyone on your account – unless you tell us otherwise. Definitions Affiliates Companies related by common ownership or control. They can be financial and nonfinancial companies.  Our affiliates include companies with a Lennar name; financial companies such as Eagle Home Mortgage, Eagle Home Mortgage of California, CalAtlantic Mortgage, Inc., and Rialto Capital Management; and nonfinancial companies, such as Lennar Corporation, Lennar Multifamily Companies, Lennar Commercial, Lennar Homes USA, Lennar Family of Builders, CalAtlantic Homes, Lennar Sales Corp., SPH Title, Inc., Sunstreet Energy Group, Five Point Communities, WCI Communities, LLC, Watermark Realty Referral, Inc., and WCI Realty, Inc. Nonaffiliates Companies not related by common ownership or control. They can be financial and nonfinancial companies.  Nonaffiliates we share with can include collection agencies, IT service providers, companies that perform marketing services on our behalf, and consumer reporting agencies. Joint marketing A formal agreement between nonaffiliated financial companies that together market financial products or services to you.  NATG doesn’t jointly market. The North American Title Group, LLC Family of Companies consists of the following entities: North American Title Company North American Title Company, Inc. North American Title Company of Colorado North American Title Insurance Company North American Services, LLC North American Title Agency, Inc. CalAtlantic Title, Inc. CalAtlantic Title of Maryland, Inc. North American Abstract Agency NASSA, LLC North American Title, LLC North American Advantage Insurance Services, LLC North American National Title Solutions, LLC North American Title Agency, LLC CalAtlantic Title Atlanta, LLC CalAtlantic Title Charleston, LLC Page 15 Rev. NAT 8/15/15 Order No. 92002-1581896-18 CLTA Preliminary Report Form - Exhibit A (Rev. 05-06-16) CLTA STANDARD COVERAGE POLICY - 1990 EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, costs, attorneys' fees or expenses which arise by reason of: 1. (a) Any law, ordinance or governmental regulation (including but not limited to building or zoning laws, ordinances, or regulations) restricting, regulating, prohibiting or relating (i) the occupancy, use, or enjoyment of the land; (ii) the c haracter, dimensions or location of any improvement now or hereafter erected on the land; (iii) a separation in ownership or a change in the dimensions or area of the land or any parcel of which the land is or was a part; or (iv) environmental protection, or the effect of any violation of these laws, ordinances or governmental regulations, except to the extent that a notice of the enforcement thereof or a notice of a defect, lien, or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Date of Policy. (b) Any governmental police power not excluded by (a) above, except to the extent that a notice of the exercise thereof or notice of a defect, lien or encumbrance resulting from a violation or alleged violation affecting the land has been recorded in the public records at Dat e of Policy. 2. Rights of eminent domain unless notice of the exercise thereof has been recorded in the public records at Date of Policy, but not excluding from coverage any taking which has occurred prior to Date of Policy which would be binding on the rights of a purchaser for value without k nowledge. 3. Defects, liens, encumbrances, adverse claims or other matters: (a) whether or not recorded in the public records at Date of Policy, but created, suffered, assumed or agreed to by the insured c laimant; (b) not known to the Company, not recorded in the public records at Date of Policy, but known to the insured claimant and not disclosed in writing to the Company by the insured claimant prior to the date the insured claimant became an insured under this policy; (c) resulting in no loss or damage to the insured claimant; (d) attaching or created subsequent to Date of Policy; or (e) resulting in loss or damage which would not have been sustained if the insured claimant had paid value for the insured mortgage or for the estate or interest insured by this policy. 4. Unenforceability of the lien of the insured mortgage because of the inability or failure of the insured at Date of Policy, or the inability or failur e of any subsequent owner of the indebtedness, to comply with the applicable doing business laws of the state in which the land is situated. 5. Invalidity or unenforceability of the lien of the insured mortgage, or claim thereof, which arises out of the transaction evi denced by the insured mortgage and is based upon usury or any consumer credit protection or truth in lending law. 6. Any claim, which arises out of the transaction vesting in the insured the estate of interest insured by this policy or the transacti on creating the interest of the insured lender, by reason of the operation of federal bankruptcy, state insolvency or similar credi tors' rights laws. EXCEPTIONS FROM COVERAGE - SCHEDULE B, PART I This policy does not insure against loss or damage (and the Company will not pay costs, attorneys' fees or expenses) which ar ise by reason of: 1. Taxes or assessments which are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the public records. Proceedings by a public agency which may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the public records. 2. Any facts, rights, interests, or claims which are not shown by the public records but which could be ascertained by an inspec tion of the land or which may be asserted by persons in possession thereof. 3. Easements, liens or encumbrances, or claims thereof, not shown by the public records. 4. Discrepancies, conflicts in boundary lines, shortage in area, encroachments, or any other facts which a correct survey would disclose, and which are not shown by the public records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b) or (c) are shown by the public records. 6. Any lien or right to a lien for services, labor or material not shown by the public records. CLTA/ALTA HOMEOWNER'S POLICY OF TITLE INSURANCE (12-02-13) EXCLUSIONS In addition to the Exceptions in Schedule B, You are not insured against loss, costs, attorneys' fees, and expenses resulting from: 1. Governmental police power, and the existence or violation of those portions of any law or government regulation concerning: a. building; b. zoning; c. land use; d. improvements on the Land; e. land division; and f. environmental protection. This Exclusion does not limit the coverage described in Covered Risk 8.a., 14, 15, 16, 18, 19, 20, 23 or 27. 2. The failure of Your existing structures, or any part of them, to be constructed in accordance with applicable building codes. This Exclusion does not limit the coverage described in Covered Risk 14 or 15. 3. The right to take the Land by condemning it. This Exclusion does not limit the coverage described in Covered Risk 17. 4. Risks: a. that are created, allowed, or agreed to by You, whether or not they are recorded in the Public Records; b. that are Known to You at the Policy Date, but not to Us, unless they are recorded in the Public Records at the Policy Date; c. that result in no loss to You; or d. that first occur after the Policy Date - this does not limit the coverage described in Covered Risk 7, 8.e., 25, 26, 27 or 28. 5. Failure to pay value for Your Title. 6. Lack of a right: a. to any land outside the area specifically described and referred to in paragraph 3 of Schedule A; and b. in streets, alleys, or waterways that touch the Land. This Exclusion does not limit the coverage described in Covered Risk 11 or 21. 7. The transfer of the Title to You is invalid as a preferential transfer or as a fraudulent transfer or conveyance under federal bankruptcy, state insolvency, or similar creditors' rights laws. 8. Contamination, explosion, fire, flooding, vibration, fracturing, earthquake, or subsidence. 9. Negligence by a person or an Entity exercising a right to extract or develop minerals, water, or any other substances. LIMITATIONS ON COVERED RISKS Your insurance for the following Covered Risks is limited on the Owner's Coverage Statement as follows:  For Covered Risk 16, 18, 19, and 21 Your Deductible Amount and Our Maximum Dollar Limit of Liability shown in Schedule A. Page 16 Rev. NAT 8/15/15 Order No. 92002-1581896-18 The deductible amounts and maximum dollar limits shown on Schedule A are as follows: Your Deductible Amount Our Maximum Dollar Limit of Liability Covered Risk 16: 1% of Policy Amount Shown in Schedule A or $2,500 (whichever is less) $10,000 Covered Risk 18: 1% of Policy Amount Shown in Schedule A or $5,000 (whichever is less) $25,000 Covered Risk 19: 1% of Policy Amount Shown in Schedule A or $5,000 (whichever is less) $25,000 Covered Risk 21: 1% of Policy Amount Shown in Schedule A or $2,500 (whichever is less) $5,000 2006 ALTA LOAN POLICY (06-17-06) EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, c osts, attorneys' fees, or expenses that arise by reason of: 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or (iv) environmental protection; or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6. 2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 11, 13, or 14); or (e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Insured M ortgage. 4. Unenforceability of the lien of the Insured Mortgage because of the inability or failure of an Insured to comply with applicable doing-business laws of the state where the Land is situated. 5. Invalidity or unenforceability in whole or in part of the lien of the Insured Mortgage that arises out of the transaction evidenced by the Insured Mortgage and is based upon usury or any consumer credit protection or truth-in-lending law. 6. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that th e transaction creating the lien of the Insured Mortgage, is (a) a fraudulent conveyance or fraudulent transfer, or (b) a preferential transfer for any reason not stated in Covered Risk 13(b) of this policy. 7. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the Insured Mortgage in the Public Records. This Exclusion does not modify or limit the coverage provid ed under Covered Risk 11(b). The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclus ions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: EXCEPTIONS FROM COVERAGE [Except as provided in Schedule B - Part II,[ t[or T]his policy does not insure against loss or damage, and the Company will not pay costs, attorneys' fees or expenses, that arise by reason of: [PART I [The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverag e, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: 1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the Public Records. 2. Any facts, rights, interests, or claims that are not shown by the Public Records but that could be ascertained by an inspection of the Land or that may be asserted by persons in possession of the Land. 3. Easements, liens or encumbrances, or claims thereof, not shown by the Public Records. 4. Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land and not shown by the Public Records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) wate r rights, claims or title to water, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records. 6. Any lien or right to a lien for services, labor or material not shown by the Public Records. ] PART II In addition to the matters set forth in Part I of this Schedule, the Title is subject to the following matters, and the Company insures against loss or damage sustained in the event that they are not subordinate to the lien of the Insured Mortgage:] 2006 ALTA OWNER'S POLICY (06-17-06) EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys' fees, or expenses that arise by reason of: 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or (iv) environmental protection; or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5. Page 17 Rev. NAT 8/15/15 Order No. 92002-1581896-18 (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6. 1. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 2. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 9 and 10); or (e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title. 3. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the tr ansaction vesting the Title as shown in Schedule A, is (a) a fraudulent conveyance or fraudulent transfer; or (b) a preferential transfer for any reason not stated in Covered Risk 9 of this policy. 4. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A. The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: EXCEPTIONS FROM COVERAGE This policy does not insure against loss or damage, and the Company will not pay costs, attorneys' fees or expenses, that arise by r eason of: [The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above E xclusions from Coverage, the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage: 1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments, or notices of such proceedings, whether or not shown by the records of such agency or by the Public Records. 2. Any facts, rights, interests, or claims that are not shown in the Public Records but that could be ascertained by an inspection of the Land or that may be asserted by persons in possession of the Land. 3. Easements, liens or encumbrances, or claims thereof, not shown by the Public Records. 4. Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land and that are not shown by the Public Records. 5. (a) Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c) water rights, claims or title to water, whether or not the matters excepted under (a), (b), or (c) are shown by the Public Records. 6. Any lien or right to a lien for services, labor or material not shown by the Public Records. 7. [Variable exceptions such as taxes, easements, CC&R's, etc. shown here.] ALTA EXPANDED COVERAGE RESIDENTIAL LOAN POLICY - ASSESSMENTS PRIORITY (04-02-15) EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy and the Company will not pay loss or damage, co sts, attorneys' fees or expenses which arise by reason of: 1. (a) Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to (i) the occupancy, use, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivision of land; or (iv) environmental protection; or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5, 6, 13(c), 13(d), 14 or 16. (b) Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 5 , 6, 13(c), 13(d), 14 or 16. 2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8. 3. Defects, liens, encumbrances, adverse claims, or other matters (a) created, suffered, assumed, or agreed to by the Insured Claimant; (b) not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy; (c) resulting in no loss or damage to the Insured Claimant; (d) attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risk 11, 16, 17, 18, 19, 20, 21, 22, 23, 24, 27 or 28); or (e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Insured Mortgage. 4. Unenforceability of the lien of the Insured Mortgage because of the inability or failure of an Insured to comply with applicable doing-business laws of the state where the Land is situated. 5. Invalidity or unenforceability in whole or in part of the lien of the Insured Mortgage that arises out of the transaction evidenced by the Insured Mortgage and is based upon usury, or any consumer credit protection or truth-in-lending law. This Exclusion does not modify or limit the coverage provided in Covered Risk 26. 6. Any claim of invalidity, unenforceability or lack of priority of the lien of the Insured Mortgage as to Advances or modificat ions made after the Insured has Knowledge that the vestee shown in Schedule A is no longer the owner of the estate or interest covered by this policy. This Exclusion does not modify or limit the coverage provided in Covered Risk 11. 7. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching subsequ ent to Date of Policy. This Exclusion does not modify or limit the coverage provided in Covered Risk 11(b) or 25. 8. The failure of the residential structure, or any portion of it, to have been constructed before, on or after Date of Policy i n accordance with applicable building codes. This Exclusion does not modify or limit the coverage provided in Covered Risk 5 or 6. 9. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that the tr ansaction creating the lien of the Insured Mortgage, is (a) a fraudulent conveyance or fraudulent transfer, or (b) a preferential transfer for any reason not stated in Covered Risk 27(b) of this policy. 10. Contamination, explosion, fire, flooding, vibration, fracturing, earthquake, or subsidence. 11. Negligence by a person or an Entity exercising a right to extract or develop minerals, water, or any other substances. Page 18 Rev. NAT 8/15/15 Order No. 92002-1581896-18