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HomeMy WebLinkAboutKKP, LLC (3) MELISSA A. SPIRO LAND PRESERVATION COORDINATOR melissa.spiro @ town.southold.ny.us Telephone (631 ) 765-5711 Facsimile (63 l) 765-6640 OFFICE LOCATION: Town Hall Annex 54375 State Route 25 (comer of Main Road & Youngs Avenue) Southold, New York MAILING ADDRESS: P.O. Box 1179 Southold, NY 11971-0959 DEPARTMENT OF LAND PRESERVATION TOWN OF SOUTHOLD To: From: Date: Re: Elizabeth A. Neville Town Clerk Melanie Doroski Sr. Administrative Assistant March 15, 2011 KKP~ LLC to TOWN OF SOUTHOLD Development Rights Easement- 8.1638 acres SCTM #1000-120.-3-11.18 Location: 750 Sound Avenue, Mattituck Betty: Enclosed for safekeeping in your office, please find the following documents: · Suffolk County Clerk Records Office Recording Page · Suffolk County Recording & Endorsement Page · Original Grant of Development Rights Easement dated December 9, 2010, between KKP, LLC and the Town of Southold, recorded in the Suffolk County Clerk's office on 1/14/2011, in Liber D00012648 at Page 617 · Title insurance policy #O-8911-556600 issued by Stewad Title Insurance Company on December 9, 2010 in the insured amount of $502,796.70 (title #ST10-09332) · Closing Statement Thank you. Melanie encs. cc: Assessors w/copy of recorded easement SUFFOLK COUNTY CLERK RECORDS OFFICE RECORDING PAGE Ty~e of Instrument: EASEMENT Number of Pages: 25 Receipt N-m~er : 11-0005378 TRANS~R TAX NUMBER: 10-12351 District: 1000 Deed Amount: Recorded: At: LIBER: PAGE: Section: Block: 120.00 03.00 EXAMINED AND CHARGED AS FOLLOWS $502,796.70 Received the Following Fees For Above Instrument Exempt Page/Filing $125.00 NO Handling COE $5.00 NO NYS SRCHG TP-584 $5.00 NO Notation Cert. Copies $16.25 NO RPT Transfer tax $0.00 NO Comm. Pres Fees Paid TRANSFER TAX NUMBER: 10-12351 THIS PAGE IS A PART OF THE INSTRUMENT THIS IS NOT A BILL JUDITH A. PASCALE County Clerk, Suffolk County 01/14/2011 04:21:10 PM D00012648 617 Lot: 011.018 Exempt $20.00 NO $15.00 NO $0.00 NO $30.00 NO $0.00 NO $216.25 DEPT. OF LAND PReSeRVATION Number o~pages This document will be public record. Please remove all Social Security Numbers prior to recording. Deed / Mortgage Instrument 31 Page / Filing Fee ] ~h- ~<~' Handling ~2:~1~. O0 TP-584 ,/ ~ Deed / Mortgage Tax Stamp FEES Notation EA-52 17 (County) EA-5217 (State) R.P.T.S.A. Comm. of Ed. Affidavit NYS Surcharge Other Sub Total 5:O0 15. O0 SubTotal Real Property ,., Tax Service Agency \.,29_DEC.10// Verification I t/^ 1000 12000 0300 011018 8 Satisfactions/Discharges/Releases List Property Owners Mailing Address RECORD & RETURN TO: ,~,~arr,~_e~r /v'~ 1/q?/ Mail to: Judith A. Pascale, Suffolk County Clerk 310 Center Drive, Riverhead, NY 11901 www. suffolkcou ntyny, gov/cierk 71 i ;rjr i~ ~;21: :'!~ Recording / Filing Stamps Mortgage Amt. 1. Basic Tax 2. Additional Tax Sub Total Spec,/Assit. or Spec./Add. TOT. MTG. TAX Dual Town __ Dual County __ Held for Appointment Transfer Tax Mansion Tax The property covered by this mortgage is or will be improved by a one or two family dwelling only. YES or NO If NO, see appropriate tax clause on page # of this instrument. 5 Community Preservation Fund Consideration Amom~t $ Due Improved Vacant Land C7o [ Title Company Inform~Oon · Name Suffolk County Recording & Endorsement Page This page forms part of the attached ~,e.~v;r ~ ~' ~)ff-~rgLe~p/~ ~r%- ~mH'/~ ~2w-/'- ""~ LZ~ ~e presses herein is situated in S~OLK CO~ ~W YORK. made by: IMPOR I'AN.,T NOTICE If the document you've Just recorded is your SATISFACTION OF MORTOAG~I-, please be aware of the following: If a portion of your monthly mortgage payment Included your property taxes, * u will now need o contact your local Town Tax Receiver so that you may be billed directly for all future property ray statements, Local property taxes are payable twice a year: on or before January l0b and on or before May 31't. Failure to make payments in a timely fashion could result in a penalty. Please contact your local Town Tax Receiver with any questions regarding property tax payment. Babylon Town Receiver of Taxes 200 East Sunrise Highway North Lindenhurst, N.Y. 11757 (631) 957-3004 Rlverhead Town Receiver of Taxes 200 Howell Avenue Rlverhead, N.Y. 11901 (631) 727-3200 Brookhaven Town Receiver of Taxes One Independence Hill Farmingvllle, N.Y. 11738 (631) 451-9009 Shelter Island Town Receiver of Taxes Shelter Island Town Hall Shelter Island, N.Y. 11964 {631) 749-3338 East Hampton Town Receiver of Taxes 300 Pantigo Place East Hampton, N.Y. 11937 (631) 324-2770 Smithtown Town Receiver of Taxes 99 West Main Street Smithtown, N.Y. 11787 (631) 360-7610 Huntington Town Receiver of Taxes 100 Main Street Huntington, N.Y. 11743 (631) 351-3217 Southampton Town Receiver of Taxes 116 Hampton Road Southampton, N.Y. 11968 (631) 283-6514 Islip Town Receiver of Taxes 40 Nassau Avenue Islip, N.Y. 11751 {631) 224-5580 Southold Town Receiver of Taxes 53095 Main Street Southold, N.Y. 11971 {631) 765-1803 Sincerely, Judith A. Pascale Suffolk County Clerk GRANT OF DEVELOPMENT RIGHTS EASEMENT THIS GRANT OF DEVELOPMENT RIGHTS EASEMENT, is made on the ~ day of December, 2010 at Southold, New York. The parties are KKP, LLC, with offices at 1002 Bluff Drive North, Baiting Hollow, New York 11948, c/o Peter Harbes, Managing Member (herein called "Grantor"), and the TOWN OF SOUTHOLD, a municipal corporation, having its principal office at 53095 Main Road, P.O. Box 1179, Southold, New York 11971 (herein call "Grantee"). INTRODUCTION WHEREAS, Grantor is the owner in fee simple of certain real property located in the Town of Southold, Suffolk County, New York, identified as part of SCTM #1000-120-3-11.9 more fully described in SCHEDULE "A" attached hereto and made a part hereof and hereinafter referred to as the "Property" and shown on the survey prepared by Nathan Taft Corwin III, Land Surveyor, dated November 2, 2010 (a reduced copy of which is attached hereto and made a part hereof and hereinafter referred to as the "Survey"); and WHEREAS, the Property is located in the A-C Zoning District of the Town of Southold; and WHEREAS, the Property contains soils classified as Class T and Class II worthy of conservation as identified by the United States Department of Agriculture Soil Conservation Service's Soil Survey of Suffolk County, New York; and WHEREAS, the Property is part of the New York State Agricultural District #1, and the Grantor wishes to continue using the Property for agricultural production as defined in this Easement; and WHEREAS, the Property is currently used for field crops; and WHEREAS, it is the policy of the Town of Southold (the "Town"), as articulated in the Town's Master Plan of 1973, amended in :~986 and 1989 as adopted by the Town Bo~'rd, Tc;wn of Southold, and §272-a of the New York State Town Law ("Town Law") to protect environmentally sensitive areas, preserve prime agricultural soils, to protect the scenic, open space character of the Town and to protect the Town's resort and agricultural economy; and WHEREAS, the Property in its present scenic and agricultural condition has substantial and significant value as an aesthetic and agricultural resource since it has not been subject to any substantial development; and WHEREAS, Grantor and Grantee recognize the value and special character of the region in which the Property is located, and Grantor and Grantee have, in common, the purpose and objective of protecting and conserving the present state and inherent, tangible and intangible values of the Property as an aesthetic, natural, scenic and agricultural resource; and WHEREAS, Grantee has determined it to be desirable and beneficial and has requested Grantor, for itself and its successors and assigns, to grant a Development Rights Easement to Grantee in order to restrict the further development of the Property while permitting compatible uses thereof; NOW THEREFORE, in consideration of F;[VE HUNDRED TWO THOUSAND SEVEN HUNDRED NTNETY-SfX AND 70/100 DOLLARS ($502,796.70) and other good and valuable consideration paid to the Grantor, the receipt of which is hereby acknowledged, the Grantor does hereby grant, transfer, bargain, sell and convey to the Grantee a Development Rights Easement, in gross, which shall be binding upon and shall restrict the premises shown and designated as the Property herein, more particularly bounded and described on Schedule "A" annexed hereto and made a part of this instrument. TO HAVEAND TO HOLD said Development Rights Easement and the rights and interests in connection with it and as hereinafter set forth with respect to the Property unto the Grantee, its successors and assigns forever, reserving, however, for the direct use and benefit of the Grantor, its legal representatives, successors and assigns, the fee title to the property, and the exclusive right of occupancy and of use of the Property, subject to the limitations, condition, covenants, agreements, provisions and use restrictions hereinafter set forth, which shall constitute and shall be servitudes upon and with respect to the Property. The Grantor, for itself, and ~or an'~] on behalf of its legal representatives, successors and assigns, hereby covenants and agrees as follows: 0.01 Grantor's Warranty Grantor warrants and represents to the Grantee that Grantor is the owner of the Property described in Schedule A, free of any mortgages or liens, except as set forth in Stewart Title Insurance Title Report No. 1009332, and possesses the right to grant this easement. 0.02 Grantee's Status Grantee warrants and represents to Grantor that Grantee is a municipal corporation organized and existing under the laws of the State of New York State and is authorized under §64 of Town Law and {}247 of the New York State General Municipal Law ("General Municipal Law") to acquire fee title or lesser interests in land, including development rights, easements, covenants, and other contractual rights which may be necessary or desirable for the preservation and retention of agricultural lands, open spaces and natural or scenic resources. 0.03 Purpose The parties recognize the environmental, natural, scenic and agricultural values of the Property and have the common purpose of preserving these values by limiting nonagricultural uses of the Property. This instrument is intended to convey a Development Rights Easement on the Property by Grantor to Grantee, exclusively for the purpose of preserving its character in perpetuity for its environmental, natural, scenic and agricultural values by preventing the use or development of the Property for any purpose or in any manner contrary to the provisions hereof, in furtherance of federal, New York State and local conservation policies. 0.04 Governmental Recognition New York State has recognized the importance of private efforts to preserve rural land in a scenic, natural, and open condition through conservation restrictions by the enactment of General Municipal Law {}247. Similar recognition by the federal government includes §170(h) of the Internal Revenue Code ("TRC") and other federal statutes. 0.05 Baseline Documentation Grantee acknowledges by a~cepta'nce of this Development Rights Easement that present uses of the Property are compatible with the purposes of this Easement. In order to aid in identifying and documenting the present condition of the Property's natural, scenic, agricultural, and aesthetic resources and otherwise to aid in identifying and documenting the Property's agricultural values as of the date hereof, to assist Grantor and Grantee with monitoring the uses and activities on the Property and ensuring compliance with the terms hereof, Grantee has prepared, with Grantor's cooperation, an inventory of the Property's relevant features and conditions (the "Baseline Documentation"). This Baseline Documentation includes, but need not be limited to, a survey prepared by Nathan Taft Corwin III, Land Surveyor, dated November 2, 2010, and a Phase 1 Environmental Site Assessment dated November 4, 2010 by Nelson, Pope and Voorhis, LLC. Grantor and Grantee acknowledge and agree that in the event a controversy arises with respect to the nature and extent of the Grantor's uses of the Property or its physical condition as of the date hereof, the parties shall not be foreclosed from utilizing any other relevant or material documents, surveys, reports, photographs or other evidence to assist in the resolution of the controversy. 0.06 Recitation In consideration of the previously recited facts, mutual promises, undertakings, and forbearances contained in this Development Rights Easement, the parties agree upon its provisions, intending to be bound by it. ARTICLE ONE THE EASEMENT 1.01 Type This instrument conveys a Development Rights Easement (herein called the "Easement"). This Easement shall consist of the limitations, agreements, covenants, use restrictions, rights, terms, and conditions recited herein. Reference to this "Easement" or its "provisions" shall include any and all of those limitations, covenants, use restrictions, rights, terms and conditions. 1.02 Definitions 4 "Development Rights" shall "mean"the permanent legal interest and right to prohibit or restrict the use of the Property for uses or purposes consistent with the terms of this Easement, including agricultural production as that term is presently referenced in {}247 of the General Municipal Law and/or defined in Chapter 70 of the Town Code of the Town of Southold (the "Town Code" or "Code") now, or as said Chapter 70 may be amended, and including the production of crops, livestock and livestock products as defined in Section 301(2)(a)-(j) of the New York State Agriculture and Markets Law ("Agriculture and Markets Law"), now, or as §301(2)(a)-(j) may be amended, provided said amended provisions are inherently similar in nature to those crops, livestock and livestock products included as of the date of this Easement. No future restrictions in said laws and/or Code or limitation in the definitions set forth in said laws and/or Code shall preclude a use that is permitted under the current law and/or Code. "Improvement" shall mean any addition to raw land, such as structures, fences, wells or drainage. "Riding Academy" shall mean a business use of a lot for any of the following purposes: the letting of horses for hire to individuals or groups whether supervised or unsupervised, horseback riding instruction or the holding of horse shows or other equine events. "Structure" shall mean anything constructed or erected on or under the ground or upon another structure or building, including walkways. Structures shall not include trellis, posts and wiring, farm irrigation systems, nursery mats, or fencing necessary for agricultural operations or to mark the boundaries of the Property, including without limitation fencing to keep out predator animals, including deer. Approvals for those items listed in the preceding sentence shall be as required by applicable provisions of the Town Code. 1.03 Duration. This Easement shall be a burden upon and run with the Property in perpetuity. 1.04 Effect This Easement shall run with the Property as an incorporeal interest in the Property, and shall extend to and be binding upon Grantor, Grantor's agents, tenants, occupants, heirs, personal representatives, successors and assigns, and all other individuals and entities and provides Grantee with the right to administer, manage and enforce the Easement as provide~l' herein. The word "Grantor" when used herein shall include all of those persons or entities. Any rights, obligations, and interests herein granted to Grantor and/or Grantee shall also be deemed granted to each and every one of its subsequent agents, successors, and assigns, and the word "Grantor and/or Grantee" when used herein shall include all of those persons or entities. ARTICLE TWO SALE GRANTOR, for FIVE HUNDRED TWO THOUSAND SEVEN HUNDRED NINETY-SIX AND 70/100 DOLLARS ($502,796.70) and such other good and valuable consideration, hereby grants, releases, and conveys to Grantee this Easement, in perpetuity, together with all rights to enforce it. Grantee hereby accepts this Easement in perpetuity, and undertakes to enforce it against Grantor. ARTICLE THREE PROHIBITED ACTS From and after the date of this Easement, the following acts, uses and practices shall be prohibited forever upon or within the Property: 3.01 Structures No structures may be erected or constructed on the Property except as permitted by the Southold Town Land Preservation Committee ("Land Preservation Committee") and other applicable provisions of the Town Code and 1.02 and 4.06 of this Easement, 3.02 Excavation and Removal of Materials; IVlininq The excavating, regrading, scraping or filling of the Property shall be prohibited, without the prior written consent of Grantee, including but not limited to from the Land Preservation Committee. Mineral exploitation, and extraction of any mineral, including but not limited to soil, gravel, sand and hydrocarbons, by any method, surface or subsurface, is prohibited. The removal of topsoil, sand, or other materials from the Property is prohibited, nor shall the topography of the Property be 6 changed, except in connection wi~h no'r'~al agricultural/horticultural activities, all of which shall require the prior written consent of Grantee, including but not limited to from the Land Preservation Committee. 3.03 Subdivision Except as provided in this Section 3.03, the Property may not be further subdivided pursuant to Town Law §§265, 276 or 277 or §335 of the Real Property Law, as they may be amended, or any other applicable State or local law. "Subdivision" shall include the division of the portion of the Property from which the development rights are acquired into two or more parcels, in whole or in part. Grantor may, subject to approval by the Planning Board of the Town of Southold and as otherwise required by applicable law, subdivide the property, provided that all resulting parcels contain at least 10 acres of preserved agricultural land subject to a development rights easement or other conservation instrument. Notwithstanding this Section 3.03, upon the death of Grantor, the underlying fee interest may be divided by conveyance of parts thereof to Grantor's executor, trustee, heirs or next of kin by will or operation of law. 3.04 Dumping The dumping or accumulation of unsightly or offensive materials including, but not limited to trash, garbage, sawdust, ashes or chemical waste on the Property shall be prohibited. This prohibition shall exclude materials used in the normal course of sound agricultural practices on the Property, including fertilization, composting and crop removal. 3.05 Signs The display of signs, billboards, or advertisements shall be prohibited, except signs whose placement, number, and design do not significantly diminish the scenic character of the Property and only for any of the following purposes: (a) to state the name of the Property and the names and addresses of the occupants and the character of the business conducted thereon, (b) to temporarily advertise the Property or any portion thereof for sale or rent, (c) to post the Property to control unauthorized entry or use, or (d) with the consent of the Grantor, to announce Grantee's easement. Signs are subject to regulatory requirements of the Town. 3,06 Utilities The creation or placement of overhead utility transmission lines, utility poles, wires, pipes, wells or drainage systems ("utilities") on the Property to service structures approved pursuant to Section 4.06 shall be prohibited without the prior written consent of the Grantee. Underground utilities must, to the extent possible, be constructed within 30 feet of the centerline of any roads or driveways, and may be used solely to service the permitted structures on the Property. The Property may not be used for the creation or placement of utilities to service any other properties, except for underground utilities presently existing, and referenced in an easement recorded simultaneously herewith in the Office of the Suffolk County Clerk and described in Section 4.06 herein. 3.07 Prohibited Uses Except for uses specifically permitted by this Easement, the use of the Property or structures on it for any residential, commercial or industrial uses, permanent or temporary, including but not limited to a riding academy, shall be prohibited. For the purposes of this section, agricultural production, as that term is presently referenced in §247 of the General Municipal Law and/or defined in Chapter 70 of the Town Code, now, or as said Chapter 70 may be amended and including the production of crops, livestock and livestock products as defined in Section 30:~(2)(a)-(j) of the Agriculture and Markets Law, now or as said Section 301(2)(a)-(j) may be amended, provided said amended provisions are inherently similar in nature to those crops, livestock and livestock products included as of the date of this Easement, and shall not be considered a commercial use. Uses, improvements and activities permitted by the Town Code now or in the future on agricultural lands protected by a development rights easement or other instrument, including but not limited to farmstands, shall not be considered a commercial use. No improvements, uses or activities inconsistent with current or future agricultural production shall be permitted on the Property. Under no circumstances shall athletic fields, golf courses or ranges, commercial airstrips and helicopter pads, motorcross biking, or any other improvements or activity inconsistent with current or future agricultural production be permitted on the Property. 3.08 Soil and Water Any use or activity that causes or"is likely to cause soil degradation or erosion or pollution of any surface or subsurface waters shall be prohibited. This prohibition shall not be construed as extending to agricultural operations and practices (including, without limitation, the use of agrochemicals such as fertilizers, pesticides, herbicides, and fungicides) that are in accordance with sound agricultural management practices of the Natural Resources Conservation Service ("NRCS"). 3.09 Drainage The use of the Property for a leaching or sewage disposal field shall be prohibited. The use of the Property for a drainage basin or sump shall be prohibited, except in accordance with sound agricultural management practices and in order to control flooding or soil erosion on the Property. 3.10 Development Riqhts The use of the acreage of this Property for purposes of calculating lot yield on any other Property shall be prohibited. Grantor hereby grants to Grantee all existing development rights (and any further development rights that may be created through a rezoning of the Property) on the Property, except for the right to construct, maintain and replace any pre-existing structures, and to construct new structures, as such rights may be provided in Section 4.06, and the parties agree that any other such development rights shall be terminated and extinguished and may not be used or transferred to any other parcels. ARTICLE FOUR GRANTOR'S RIGHTS 4.0:1 Ownership Subject to the provisions of ARTICLE THREE, Grantor shall retain all other rights of ownership in the Property, some of which are more particularly described in this ARTICLE FOUR. 4.02 Possession Grantor shall continue to have the right to exclusive possession of the Property. 4.03 Use 9 Grantor shall have the right to use the Property in any manner and for any purpose consistent with and not prohibited by this Easement, as well as applicable local, State, or federal law. Grantor shall have the right to use the Property for uses, improvements and activities permitted by the Town Code, now or in the future, on agricultural lands protected by a development rights easement or other instrument, including, but not limited to farmstands and for educational or training programs related to agricultural production or activities. Grantor shall also have the right to use the Property for traditional private recreational uses, provided such recreational uses are conducted for the personal enjoyment of Grantor, are compatible with farming, and are otherwise consistent with and do not derogate from or defeat the Purpose of this Easement or other applicable law. These uses shall not be offered or provided for the commercial purposes, including the commercial gain of Grantor or others. Grantor may maintain the following pre-existing uses located within the 7,966 sq. ft. access area at the northeast side of the Property and shown on the Survey ("the Access Area"): :t. Parking within the northerly portion of the Access Area shown on the Survey as the "Gravel & Dirt Area," up to the point shown on the survey as "Post and Rail Fence," provided said parking area is used in conjunction with Grantor's retail agricultural uses; 2. "Dirt Access Road" shown on the survey, used for the following: a) agricultural purposes; b) to access overflow parking areas on adjacent parcels for Grantor's retail agricultural uses; c) to access a residential dwelling, on an adjacent parcel. Said dirt access road shall only be used for the purposes set forth in this 4.03, and not for any new or additional uses. 4.04 Landscaping Activities Grantor shall have the right to continue the current and/or customary modes of landscaping, pruning and grounds maintenance on the Property as evidenced by the documentation set forth in Section 0.05. Grantor shall have the right to remove or restore trees, shrubs, or other vegetation when dead, diseased, decayed or damaged or interfering with agricultural production, to thin and prune trees to l0 maintain or improve the appearai~¢e of the property, and to mow the property. 4.05 Agricultural Production and Activities Grantor shall have the right to engage in all types of agricultural production as the term is presently referenced in Section 247 of the General Municipal Law and/or defined in Chapter 70 of the Town Code, now or as said Chapter 70 may be amended and including the production of crops, livestock and livestock products as defined in Section 301(2)(a)-(j) of the Agriculture and Markets Law, now, or as may be amended, provided said amended provisions are inherently similar in nature to those crops, livestock and livestock products included as of the date of this Easement. No future restriction in said laws and/or Code or limitation in the definitions set forth in said laws and/or Code shall preclude a use that is permitted under the current law and/or Code. Grantor may offer "U-Pick" operations and/or the use of a corn maze to the general public, provided that such activities are conducted in conjunction with seasonal harvests, do not interfere with agricultural production and are otherwise consistent with and do not derogate from or defeat the Purpose of this Easement or other applicable laws. Notwithstanding the definition of agricultural production in Chapter 70 of the Town Code or any successor chapter, structures shall be prohibited except as set forth in Section 4.06 herein and as permitted by the Town Code now or in the future on agricultural lands protected by a development rights easement or other instrument, including but not limited to farmstands. 4.06 Structures A. Allowable Tmprovements. Grantor shall have the right to erect and maintain the following improvements on the Property, as may be permitted by the Town Code and subject to the approval of the Town of Southold Land Preservation Committee, provided the improvements are consistent with and do not derogate from or defeat the Purpose of this Easement or other applicable laws: (i) Underground facilities used to supply utilities solely for the use and enjoyment of the Property; (ii) Underground utilities presently existing and referenced in an easement recorded simultaneously herewith, said easement area shown on the Survey. Pre-existing dirt access road, located within the 7,966 sq.ft. Access Area of the Property and accessed from Sound Avenue, shown on the Survey; (iv) New construction, including drainage improvement structures, provided such structures are necessary for or accessory to agricultural production; (v) Renovation, maintenance and repairs of any existing structures or structures built or permitted pursuant to this Section 4.06, provided the primary purpose of the structure remains agricultural; (vii) Any improvement excluded from the definition of "Structure" in Section 1.02. B. Conditions. Any allowable improvements shall protect prime agricultural soils, agricultural production, open space and scenic vistas, and otherwise be consistent with the Purpose of this Easement. C. Environmental Sensitivity During Construction. The use and location of any improvement permitted hereunder shall be consistent with the purposes intended herein, and construction of any such improvement shall minimize disturbances to the environment. Grantor shall employ erosion and sediment control measures to mitigate any storm water runoff, including but not limited to minimal removal of vegetation, minimal movement of earth and minimal clearance of access routes for construction vehicles. D. Replacement of Improvements. Tn the event of damage resulting from casualty loss to an extent which renders repair of any existing improvements or improvements built or permitted pursuant to this Section 4.06 impractical, erection of a structure of comparable size, use, and general design to the damaged structure shall be permitted in kind and within the same general location, subject to the review and written approval of Grantee, pursuant to applicable provisions of the Town Code. 4.07 Notice Grantor shall notify Grantee, in writing, before the construction of any permanent or temporary structures as permitted in Section 4.06 herein and shall file all necessary applications and obtain all necessary approvals that may be required by this Easement or by the Town Code, and shall provide documentation as may be required for such applications. 4.08 Alienability Grantor shall have the right to convey, mortgage or lease all of its remaining interest in the Property but only subject to this Easement. Grantor shall promptly notify Grantee of any conveyance of any interest in the Property, including the full name and mailing address of any transferee, and the individual principals thereof, under any such conveyance. The instrument of any such conveyance shall specifically set forth that the interest thereby conveyed is subject to this Easement, without modification or amendment of the terms of this Easement, and shall incorporate this Easement by reference, specifically setting for the date, office, liber and page of the recording hereof. The failure of any such instrument to comply with the provisions hereof shall not affect Grantee's rights hereunder. 4.09 Further Restriction Nothing in this Easement shall prohibit or preclude Grantor from further restricting the use, improvements or structures on the Property. Any such further restrictions shall be consistent with and in furtherance of the general intent and purpose of this Easement as set forth in Section 0.03. ARTICLE FIVE GRANTOR'S OBLIGATIONS 5.01 Taxes and Assessments Grantor shall continue to pay all taxes, levies, and assessments and other governmental or municipal charges, which may become a lien on the Property, including any taxes or levies imposed to make those payments, subject, however, to Grantor's right to grieve or contest such assessment. The failure of Grantor to pay all such taxes, levies and assessments and other governmental or municipal charges shall not cause an alienation of any rights or interests acquired herein by Grantee. 5.02 Indemnification ]3 Grantor shall indemnify and hold'"Grantee harmless for any liability, costs, attorneys' fees, judgments, expenses, charges or liens to Grantee or any of its officers, employees, agents or independent contractors, all of which shall be reasonable in amount, arising from injury due to the physical maintenance or condition of the Property caused by Grantor's actions or inactions, or from any taxes, levies or assessments upon it or resulting from this Easement, all of which shall be considered Grantor's obligations. 5.03 Third Party Claims Grantor shall indemnify and hold Grantee harmless for any liability, costs, attorneys' fees, judgments, or expenses, charges or liens to Grantee or any of its officers, employees, agents or independent contractors, all of which shall be reasonable in amount, resulting: (a) from injury to persons or damages to property arising from any activity on the Property; and (b) from actions or claims of any nature by third parties arising out of the entering into or exercise of rights under this Easement, excepting any of those matters arising solely from the acts of Grantee, its officers, employees, agents, or independent contractors. 5.04 Grounds Maintenance Requirement If Grantor leaves the Property fallow and does not engage in agricultural production for two (2) consecutive years, then Grantor shall implement a Natural Resources Conservation Plan (the "Plan") approved by Grantee, including the Land Preservation Committee, to maintain or restore the Property to the condition in which it existed on the date of this Easement, as evidenced by the documentation referred to in Section 0.05, in order to protect the environmental, natural, scenic and agricultural values of the Property. In the event Grantor fails to comply with the provisions of this section after reasonable written notice is given to Grantor by Grantee, then, in addition to all other remedies set forth herein, Grantee or its agents are hereby authorized to enter upon the Property to implement the Plan, and to recover the costs of such implementation from Grantor, as provided in Section 5.02 and Section 6.03. ARTICLE SIX GRANTEE'S RIGHTS 6.01 Entry and Inspection ]4 Grantee shall have the right' to e~'ter upon the Property at reasonable times, upon prior notice to Grantor, and in a manner that will not interfere with Grantor's quiet use and enjoyment of the Property, for the purpose of inspection to determine whether this Easement and its purposes and provisions are being upheld. Grantee shall not have the right to enter upon the Property for any other purposes, except as provided in Section 5.04 and 6.03, or to permit access upon the Property by the public. 6.02 Restoration In addition to Grantee's remedies under Section 5.04, Grantee shall have the right to require the Grantor to restore the Property to the condition required by this Easement and to enforce this right by any action or proceeding that Grantee may reasonably deem necessary. However, Grantor shall not be liable for any changes to the Property resulting from causes beyond the Grantor's control, including, without limitation, fire, flood, storm, earth movement, wind, weather or from any prudent action taken by the Grantor under emergency conditions to prevent, abate, or mitigate significant injury to persons or to the Property or crops, livestock or livestock products resulting from such causes. 6.03 Enforcement RJqhts of Grantee Grantor acknowledges and agrees that Grantee's remedies at law for any violation of this Easement may be inadequate. Therefore, in addition to, and not as a limitation of, any other rights of Grantee hereunder at law or in equity, in the event any breach, default or violation of any term, provision, covenant or obligation on Grantor's part to be observed or performed pursuant to this Easement is not cured by Grantor within ten (10) days' notice thereof by Grantee (which notice requirement is expressly waived by Grantor with respect to any such breach, default or violation which, in Grantee's reasonable judgment, requires immediate action to preserve and protect any of the agricultural values or otherwise to further the purposes of this Easement), Grantee shall have the right at Grantor's sole cost and expense and at Grantee's election: (i) To institute a suit to enjoin or cure such breach, default or violation by temporary and/or permanent injunction, (ii) To enter upon the Property and exercise reasonable efforts to terminate or cure such breach, default or violation and/or to cause the restoration of that portion of the 15 Property affected by '~uch I~reach, default or violation to the condition that existed prior thereto, or (iii) To enforce any term provision, covenant or obligation in this Easement or to seek or enforce such other legal and/or equitable relief or remedies as Grantee deems necessary or desirable to ensure compliance with the terms, conditions, covenants, obligations and purposes of this Easement; provided, however, that any failure, delay or election to so act by Grantee shall not be deemed to be a waiver or a forfeiture of any right or available remedy on Grantee's part with respect to such breach, default, or violation or with respect to any other breach, default or violation of any term, condition, covenant or obligation under this Easement. Grantor shall pay either directly or by reimbursement to Grantee, all reasonable attorneys' fees, court costs and other expenses incurred by Grantee (herein called "Legal Expenses") in connection with any proceedings under this Section, as approved by the Court. The cure period in this Section 6.03 may be extended for a reasonable time by Grantee if such restoration cannot reasonably be accomplished within ten (10) days. 6.04 Notice All notices required by this Easement must be written. Notices shall be delivered by hand or by registered or certified mail, return receipt requested, with sufficient prepaid postage affixed and with return receipts requested. Mailed notice to Grantor shall be addressed to Grantor's address as recited herein, or to such other address as Grantor may designate by notice in accordance with this Section 6.04. Mailed notice to Grantee shall be addressed to its principal office recited herein, marked to the attention of the Supervisor and the Town Attorney, or to such other address as Grantee may designate by notice in accordance with this Section 6.04. Notice shall be deemed given and received as of the date of its manual delivery or three business days after the date of its mailing. 6.05 No Waiver Grantee's exercise of one remedy or relief under this ARTICLE SlX shall not have the effect of waiving or limiting any other remedy or relief, and the failure to exercise or the delay in exercising any remedy 16 shall not constitute a waiver of a~'y oth'&r remedy or relief or the use of such other remedy or relief at any other time. 6.06 Extinguishment of Easement/Condemnation At the mutual request of Grantor and Grantee, a court with jurisdiction may, if it determines that conditions surrounding the Property have changed so much that it becomes impossible to fulfill the Purpose of this Easement described in Section 0.03, extinguish or modify this Easement in accordance with applicable law. The mere cessation of farming on the Property shall not be construed to be grounds for extinguishment of this Easement. if at any time the Property or any portion thereof shall be taken or condemned by eminent domain, by the Grantee or by any other governmental entity, then this Easement shall terminate with respect to the Property, or portions thereof so taken or condemned, and the Property shall not be subject to the limitations and restrictions of this Easement. In such event, the Grantor, its successors or assigns, shall not be required to pay any penalties, but the value of the Property shall reflect the limitations of this Easement. Any condemnation award payable to the Grantor shall be in proportion to the value attributable to the residual agricultural value of the Property. If the condemnation is undertaken by an entity other than the Grantee, then the remaining portion of the condemnation award shall be payable to the Grantee in proportion to the value attributable to the development rights transferred hereby. ARTICLE SEVEN MISCELLANEOUS 7.01 EntireUnderstandinq This Easement contains the entire understanding between its parties concerning its subject matter. Any prior agreement between the parties concerning its subject matter shall be merged into this Easement and superseded by it. 7.02 Amendment This Easement may be amended only with the written consent of Grantee and current Grantor and in accordance with any applicable State and local laws. Any such amendment shall be consistent with the Purpose of this Easement and shall comply with the Town Code 17 and any regulations promu gated'hereunder and with the Purpose of this Easement, and shall be duly recorded. This Easement is made with the intention that it shall qualify as a Conservation Easement in perpetuity under Internal Revenue Code §170(h). The parties agree to amend the provisions of this Easement if such amendment shall be necessary, to entitle Grantor to meet the requirements of §:[70(h). Any such amendment shall apply retroactively in the same manner as if such amendment or amendments had been set forth herein. 7.03 Alienation No property rights acquired by Grantee hereunder shall be alienated except pursuant to the provisions of Chapter 70 of the Town Code or any successor chapter and other applicable laws, upon the adoption of a local law authorizing the alienation of said rights and interest, following a public hearing and, thereafter, ratified by a mandatory referendum by the electors of the Town of Southold. No subsequent amendment of the provisions of the Town Code shall alter the limitations placed upon the alienation of those property rights or interests which were acquired by the Town prior to any such amendment. In addition to the limitations set forth above, Grantee shall have the right to transfer all or part of this Easement to any public agency, or private non-governmental organization, that at the time of transfer is a "qualified organization" under §170(h) of the Tnternal Revenue Code, provided that transferee expressly agrees to assume the responsibility imposed on the Grantee by this Easement. Any easement transfer must be approved by the Grantor or any subsequent owner. If the Grantee ever ceases to exist, a court of competent jurisdiction may transfer this Easement to another qualified public agency that agrees to assume the responsibilities imposed by this Easement. 7.04 Severability Any provision of this Easement restricting Grantor's activities, which is determined to be invalid or unenforceable by a court shall not be invalidated. Tnstead, that provision shall be reduced or limited to whatever extent that court determines will make it enforceable and effective. Any other provision of this Easement that is determined to be invalid or unenforceable by a court shall be severed from the other provisions, which shall remain enforceable and effective. 7.05 Governinq Law New York law applicable to deeds to and easements on land located within New York shall govern this Easement in all respects, including validity, construction, interpretation, breach, violation and performance. 7.06 ]Interpretation Regardless of any contrary rule of construction, no provision of this Easement shall be construed in favor of one of the parties because it was drafted by the other party's attorney. No alleged ambiguity in this Easement shall be construed against the party whose attorney drafted it. If any provision of this Easement is ambiguous or shall be subject to two or more interpretations, one of which would render that provision invalid, then that provision shall be given such interpretation as would render it valid and be consistent with the purposes of this Easement. Any rule of strict construction designed to limit the breadth of the restrictions on use of the Property shall not apply in the construction or interpretation of this Easement, and this Easement shall be interpreted broadly to effect the purposes of this Easement as intended by the parties. The parties intend that this Easement, which is by nature and character primarily negative in that Grantor has restricted and limited his right to use the Property, except as otherwise recited herein, be construed at all times and by all parties to effectuate its purposes. 7.07 Public Access Nothing contained in this Easement grants, nor shall it be interpreted to grant, to the public, any right to enter upon the Property, or to use images of the Property. Grantee may use images of the Property only for non-commercial reporting of this Easement. 7.08 Warranties The warranties and representations made by the parties in this Easement shall survive its execution. 7.09 Recording Grantee shall record this Easement in the land records of the office of the Clerk of the County of Suffolk, State of New York. 7.10 Headings 19 The headings, titles and subtitles herein have been inserted solely for convenient reference, and shall be ignored in its construction. iN WITNESS WHEREOF, Grantor has executed and delivered and Grantee has accepted and received this Grand of Development Rights Easement on the day and year set forth above. ACKNOWLEDGED AND ACCEPTED: KKP, LLC, Gr~3ntor,/ ~ j P~-I=ER H/~RBES, Managir~g M~'~bef~ ACKNOWLEDGED AND ACCEPTED: S~ot~-/A. Russell, Supervisor STATE OF NEW YORK) COUNTY OF SUFFOLK), SS: On the ~ day of ~ in the year 2010 before me, the undersigned, personally appeared Peter Harbes, personally known to me or proved to me on the basis of satisfactory evidence to be the individual (s) whose name (s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity (les), and that by his/her/their signature(s) on the instrument, the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. Signature/office of individual taking acknowledgement PATRICIA L. FALLON STATE OF NEW YORK ) Notary Public, State Of New Yorl~ COUNTY OF SUFFOLK ) SS: No. 01FA4950146 Qualiiiad in Suffoik County Commission Expires April 24, ,,~// On this ~ day of ~Z~ in the year 2010 before me, the undersigned, personally appeared Scott A. Russell, personally known to me or proved to me on the basis of satisfactory evidence to be the individual(s) whose name(s) is (are) subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their capacity(les), and that by 20 his/her/their signature(s) on the inst£~mbn't~'the individual(s), or the person upon behalf of which the individual(s) acted, executed the instrument. Notary Public PATRICIA L. FALLON Notary Public, State Of New York No. 01FA4950146 O~elified In Suffolk County Commission Expires April 24~ 2! insurance company SCHEDULE A - DESCRIIrI'ION NEW YORK METRO 800 853-4803 212 922-1593 fax stewartnewyork.com AMENDED 12/7/2010 DEVELOPMENT RIGHTS EASEMENT AREA Tit~ No.: ST10-09332 ALL that certain plot, piece or parcel of land, situate, lying and being in the Hamlet of Mattituck, Town of Southold, County of Suffolk and State of New York, bounded and described as follows: BEGINNING at a point on the southerly side of Sound Avenue distant the following two (2) courses and distances from the corner formed by the intersection of the southerly side of Sound Avenue with the westerly side of Aldrich Lane (Elisha's Lanel: North 89 degrees 54 minutes 00 seconds West, 489.07 feet: South 88 degrees 13 minutes 50 seconds West, 119.94 feet to the true point or place of beginning; (1) (2) RUNNING THENCE 'along land now or formerly of Harbes Farm Riverhead East, LLC and through a concrete monument, South 19 degrees 59 minutes 10 seconds East, 1,389.36 feet to land now or formerly of P&E, LLC (Town of Southold Development Rights); THENCE along said land South 71 degrees 31 minutes 30 seconds West, 305.21 feet to land now or formerly of Patricia Dive[lo; THENCE along said land North 19 degrees 53 minutes 50 seconds West, 1,120.73 feet to a point: THENCE North 70 degrees 06 minutes 10 seconds East, 253.42 feet to a point: THENCE North 19 degrees 59 minutes 10 seconds West, 277.45 feet to the southerly side of Sound Avenue: THENCE along the southerly side of Sound Avenue North 88 degrees 13 minutes 50 seconds East, 52.64 feet to the true point or place of BEGINNING. RESERVE AREA - NOT TO BE INSURED (for informational purposes only) ALL that certain plot, piece or pamel of land, situate, lying and being in the Hamlet of Mattituck, Town of Southold. County of Suffolk and State of New York, bounded and described as follows: BEGINNING at a point on the southerly side of Sound Avenue distant the following three (3) courses and distances from the comer formed by the intersection of the southerly side of Sound Avenue with the westerly side of Aldrich Lane (Elisha's Lane): (i) North 89 degrees 54 minutes 00 seconds West, 489.07 feet: (2) (3) South 88 degrees 13 minules 50 seconds West. 119.94 feet: South 88 degrees 13 minutes 50 seconds Wesl, 52.64 feet to the tree point or place of beginning: RUNNING THENCE Sou~h 19 degrees 59 minutes 10 seconds Ea.st, 277.45 feel lo a point: THENCE South 70 degrees 06 minutes 10 seconds West, 253.42 feet to land now or formerly of Patricia Divello: THENCE 'along said land North 19 degrees 53 minutes 50 seconds West, 351.79 feet to the southerly side of Sound Avenue; THENCE 'along said southerly side of Sound Avenue the following two (2) courses and distances: (1) (2) Norlh 85 degrees 38 minutes 20 seconds East, 178.42 feet: North 88 degrees 13 minutes 50 seconds East, 85.33 feet to the true point or place of BEGINNING. ACCESS AREA ALL that ceaain plot, piece or parcel of land, situate, lying and being in the Hamlet of Mattituck, Town of Southold, County of Suffolk and State of New York, bounded and described as follows: BEGINNING at a point on lhe southerly side of Sound Avenue distant the following Iwo (2) courses and distances from the comer formed by the intersection of the southerly side of Sound Avenue with the westerly side of Aldrich Lane (Elisha's Lane): (1) (2) Noah 89 degrees 54 minules 00 seconds West, 489.07 feet: South 88 degrees 13 minutes 50 seconds West, 119.94 feet lo the true point or place of beginning: RUNNING THENCE along land now or formerly of Harbes Farm Riverhead East, LLC and through a concrete monument, South 19 degrees 59 minutes 10 seconds East, 268.32 feet; THENCE South 70 degrees 00 minutes 59 seconds West, 25.38 feet; THENCE North 19 degrees 59 minutes 10 seconds West, 234.57 feet: THENCE South 85 degrees 59 minutes 29 seconds West, 25.61 feet; THENCE Noah 19 degrees 59 minutes 10 seconds West, 43.15 feet to the southerly side of Sound Avenue: THENCE along the southerly side of Sound Avenue North 88 degrees 13 minutes 50 seconds East, 52.64 feet to the true point or place of BEGINNING. SURVEY OF PROPERTY MATTITUCK f ~:.,=~. INathan Taft Corwin Ill Land Surveyor ALTA Owner's Policy (6 17 06) POLICY OF TITLE INSURANCE ISSUED BY ~l~it le .res u ~ ~W~ c eacorm p'~any Any notice of claim and any other notice or statement in wdting required to be given lhe Company under this Policy must be given to the Company at the address shown in Section 18 of the Conditions. COVERED RISKS SUBJECT TO THE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE CONTAINED IN SCHEDULE B AND THE CONDITIONS, STEWART TITLE INSURANCE COMPANY, a New York corporation, {the "Company") insures, as of Date of Policy and, to the ex~ent stated in Covered Risks 9 and 10, after Date of Policy, against loss or damage, not exceeding the Amount of insurance, sustained or incurred by the insured by reason oh 1. Title being vested other than as stated in Schedule A. 2 Any defect in or lien or encumbrance on the Title. This Covered Risk includes but is not limited to insurance against loss from (a) A defect in the Title caused by (i) forgery, fraud, undue influence, duress, incompetency, incapacity, or impersonation; (ii) failure ol any person or Entity to have authorized a transfer or conveyance; (iii)a document affecting Title not pmpedy created, executed, witnessed, sealed, acknowledged, notarized, or delivered; {iv) failure to perform those acts necessary to create a document by electronic means authorized by law (v) a document executed under a falsified, expired, or otherwise invalid power of attorney (vi) a document not properly filed, recorded, or indexed in the Public Records including failure to perform those acts by electronic means authorized by law; or (vii) a delective judicial or administrative proceeding (b) The lien of real estate taxes or assessments imposed on the Title by a governmental authority due or payable, but unpaid. {c) Any encroachment, encumbrance, violation, variation, or adverse circumstance alfecting the Title that would be disclosed by an accurate and complete land survey of the Land. The term "encroachment" includes encroachments of existing improvements located on the Land onto adjoining land, and encroachments onto the Land of existing improvements located on adjoining land 3 Unmarketable Tide. 4. NO right of access to and from the Land. 5. The violation or enforcement of any law, ordinance, permit, or governmental regulation (icoluding those relating to building and zoning) restricting, regulating, prohibiting, or relating to (a) the occupancy, uss, or enjoyment of the Land; (b) the character, dimensions, or iccetion of any improvement erected on the Land; (c) the subdivision of land; or (d) environmental protection if a notice, describing any part of the Land, is recorded in the Public Records setting lorth the violation or intention to enlorce, but only to the extent ol the violation or enforcement referred to in that notice. 6. An enforcement action based on the exercise of a governmental police power not covered by Covered Risk 5 if a notice ol the enforcement action, describing any par1 of the Land, is recorded in the Pubtic Records, but only to the extent ol the enforcement relerred to in that notice. 7. The exercise of the rights ol eminent domain if a notice of the exercise, describing any part of the Land, is recorded in the Public Records 8. Any taking by a governmenta~ body that has occurred and is binding on the rights of a purchaser for value without Knowledge. Countersigned: Stewart Title Insurance Company New York, New York Policy Serial No O-8911-556600 File No.: ST10-09332 COVERED RISKS (Continued) Title being vested other than as stated in Schedule A or being defective ia) as a result of the avoidance in whole or in part, or from a court order (b) (i) to be timely, or (ii) to impart notice of its existence to a purchaser for value er to a providing an alternative remedy, of a transfer of all or any par[ of the judgment or lien creditor title to or any interest in the Land occurring prior to the transaction 10. Any defect in or lien or encumbrance on the Title or other matter included vesting Title as shov~ in Schedule A because that prior transfer in Covered Risks 1 through 9 that has been created or attached or has constituted a fraudulent or preferential transfer under federal been tiled or recorded in the PubJic Records subsequent to Date of Policy bankruptcy, state insolvency, or similar creditors' rights laws; or and prior to the r6cording of the deed or other instrument of transfer in the because the instrument of transfer vesting Title as shown in Public Records that vests Title as shown in Schedule A, Schedule A constitutes a preferential transfer under federal The Company witl also pay the costs, attorneys' fees. and expenses incurred in bankruptcy, state insolvency, or similar creditors' rights laws by defense of any matter insured against by this Policy, but only to the extent reason of the failure of tis recording in the Public Records provided in the Conditions EXCLUSIONS FROM COVERAGE The following matters are expressly excluded from the coverage of this policy, and the Company will not pay Isss or damage, costs, attorneys' fees. or expenses that arise by reason of: 1 {a) Any law, ordinance, permit, or governmental regulation (inciudieg those relating to building and zoning) restricting, regalating, prohibiting, or relating to (i) the occupancy, uso, or enjoyment of the Land; (ii) the character, dimensions, or location of any improvement erected on the Land; (iii) the subdivisicn of lead; or (iv) environmental protection; 4. or the ettect of any violation of these tsws. ordinances, or governmental regulations. This Exclusion 1 (a) does not medtiy or limit the coverage provided under Covered Risk 5. (b) Any governmental police power. This Exclusion t(b) does not modify or limit the coverage provided under Covered Risk 6, 2. 2. Rights of eminent domain. This Exclusion does not modify or limit the 5. 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 tho 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 tho 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 CAaimant had paid value for the Title. Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors' rights laws, that tho transaction vesting the Title as shown in Schedule A, is (a) a fraudulent conveyance or frauduJent transfer; or (b) a preferential transfer for any reason not stated in Covered Risk 9 of this policy. Any lien on the Tilts far real eslate taxes or assessments imposed by govemmeetal aathorib/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 show~ in Schedule A. CONDITIONS DEFINITION OF TERMS The iollov~ng terms when used in this policy mean: {a) "Arr~uet of Insurance": The amount stated in Schedule A. as may be increased or decreased by endorsement to this policy, increased by Section 8(b), or decreased by Sections 10 and 11 of these Conditions. (b) "Date of Policy": The date designated as "Dste of Policy" in Schedule A. (c) "Entity": A corporation, partnership, trust, limited liability company, or other similar legal entity. (d) "Insured": The Insured named in Schedule A. (i) The term "lssured" also includes (A) successors to the Title of the Insured by operation of law as distinguished from purchase, including heirs, devisees, survivors, personal representatives, or next of kin; (B) successors to an Insured by dissolution, merger. consolidation, distribution, or reorganization; (C) suceessors to an Insured by its conversion to another kind of Entity; (D) a grantee of an tosured under a deed delivered without payment of actual valuable consideration conveying the Title (1) if the stock, shares, memberships, or other equity interests of the grantee are wholly-owned by the named Insured, (2) if the grantee wholly ow~s the named Insured, (3) if the grantee is wholly-owned by an affiliated Entity of the named insured, provided the affiliated Entity and the named Insured are both wholly-owned by the same person or Entity, or (4) if the grantee is a trustee or beneficiary of a trust created by a written instrument established by the Insured named in Schedule A for estate planning purposes. (ii) With regard to (A), (B), (C), and (D) reset, lng, however, all F~cjht s and defenses as to any successor that the Company would have had against any predecessor Insured. (e) "insured Claimant": An Insured claiming loss or damage. (f) "Knowledge" or "Known": Actual knowledge, not constructive knowledge or notice that may be imputed to an insured by reason ol the Public Records or any other records that impart eanstrocfive nofice of matters affecting the (g) "Land": The land described in Schedule A, and affixed improvements that by law c~nstitute real property. The term "Land" does not include any property beyond the lines of the area described in Schedule A, r~r any right, title, interest, estate, or easement in abutting streets, roads, avenues, alleys, lanes, ways, or waterways, but this does not modify or limit the extent that a right of access to and from the Land is insured by this policy. (h) "Mortgage": Modgage. deed of trust, trust deed, or other security instrument, including one evidenced by electronic means authorized by law. (i) "Public Records": Records established under state statutes at Date of Policy for the purpose of imparting constructive notice of matters reloting to real property to purchasers for value and without Knowledge. With respect to Covered RL~k 5(d), "Public Records" shall also include environmental protection liens filed in the records of the clerk of the United States District Court for the district where the Land is located, (j) "Title": The estate or interest described in Schedule A (k) "Unmarketable Title": Title affected by an alleged or apparent matter that ~,~uid pormfi a prospective purchaser or lessee of the Title or lender on the Title to be released from the obligation to purchase, lease, or lend if there is a contractual condition requiring the delivery el marketable title. I Pa~e 2 Sebal No.: O-8911-556600 File No: ST10-09332 CONDITIONS (Continued) 2. CONTINUATION OF INSURANCE The coverage of this policy shall continue in farce as of Date of Policy in [avor of an insured, but only so long as the insured retains an estate or interest in the Land, or belds an obligation secured by a purchase money Mot[gage given by a purchaser from the Insured, or only so long as the insured shall have liabilit y by reason of warranties in any transfer or conveyance of the Title This policy shafi not continue in force in favor of any purchaser from the Insured of either (i} an estate or interest in the Land, or {ii) an obligation secured by a purchase money Modgage given to the insured 3. NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT The insured shall notify the Company promptly in writing {il in case of any litigation as set forth in Section 5(al of these Conditions, (ii) in case Knowledge shall come to an insured hereunder of any claim of title or interest that is adverse to the Title, as insured, and that might cause loss or damage for w~ich the Company may be liable by virioe of this policy, or (iii) if the Title, as insured, is rejected as Unmarketable Title. If the Company is prejudiced by the lailure ol the Insured Claimant to provide prompt notice, the Company's liability to the insured Claimant under the policy shall be reduced to the extent of the prejudice 4. PROOF OF LOSS In the event the Company is unable to determine the amount of less or damage, the Company may, at its option, require as a condition of payment that the Insured Claimant furnish a signed proof of loss The proof of loss must describe the defect, lien, encumbrance, or other matter insured against by this policy that constitutes the basis of ioas or damage and shall state, to the extent possible, the basis of calculating the amount of the loss or damage 5, DEFENSE AND PROSECUTION OF ACTIONS (al Upon written request by the Insured, and subject to the options contained in Section 7 of these Conditions, the Company, at its own cost and without unreasonable delay, shall provide for the defense of an Insured in litigation in which any third party asserts a claim covered by this policy adverse to the insured. This obligation is limited to only those stated causes of action alleging mat[ers insured against by this policy. The Company shall have the right to select counsel of its choice (subject to the right of the Insured to object for reasonable cause) to represent the Insured as to those stated causes el acpon. It shaJl not be liable for and will not pay the fees of any other counsel. The Company will not pay any fees, costs, or expenses incurred by the Insured in the defense of ~se causes of action that allege mat[em not insured against by this policy. (b) The Company shall have the fight, in addition to the options contained in Section 7 of these Conditions. at its own cost, to institute and prosecute any action or prcoeediog or to do any other act that in its opinion may be necessary or desirable to establish the Title. as insured, or to prevent or reduce loss or damage to the Insured The Company may take any appropriate action under the terms of this policy, whather or not it shall be liable to the Insured. The exercise of these rights shall not be an admission of liability or waiver ol any provision of this policy. If the Company exercises its rights under this subsection, it must do so diligently. (c) Whenever the Company brings an actlen or asserts a defense as required or permit[ed by this policy, the Company may pursue the litigation to a final datermination by a court of competent jurisdiction, and it expressly reserves the right, in its sole discretion, to appeal any adverse judgment or order. 6. DDTY OF INSURED CLAIMANT TO COOPERATE (al In all cases where this policy permits or requires the Company to prosecute or provide lor the defense of any action or proceeding and any appeals, the Insured shall secure to the Company the righ[ to so p~osecute or provide defense in the action or proceeding, including the right to use, at its option, the name of the Insured for this purpose Whenever requested by the Company, the Insured, at the Company's expense, shall give the Company all reasonable aid (il in securing evidence, (b) obtaining witnesses, prosecuting o~ defending the action or proceeding, or effecting settlement, and (ii) in any other lawful act that in the opinion of the Company may be necessary or desirable to establish the Title or any other matter as insured if the Company is prejudiced by the failure of the Insured to famish the required cooperation, the Company's obligations to the Insured under the policy shall terminate, lecludle9 any liability or obligation to defend, prosecute, or continue any litigation, with regard to the mat[er or matters requiring such cooperation. The Company may reasonably require the Insured Claimant to submit to examinatidn under oath by any authorized representative of the Company and to produce for examination, inspection, and copying, at such reasonable times and places as may be designated by the authedzed rep~aseutative of the Company, all records, in whatever medium maintained, including books, ledgers, checks, memoranda, correspondence, reports, e-malls, disks, tapes, and videos whether bearing a date before or after Date at Policy, that reasonably par~ain to the loss or damage. Further, if requested by any authorized representative of the Company, the Insured Claimant shall grant its permission, in writing, for any authorized representative of the Company to examine, inspect, and copy all of these records in the custody or control of a third party that reasonably pertain to the lose or damage. All information designated as confidential by the Insured Claimant provided to the Company pumuant to this Section shall not be disclosed to others uctess, in the reasonable judgment of the Company, it is neeessapj in the administration of the elalm. Failure of the Insured Claimant to submit for examination under oath, produce any reasonably requested information, or grant permission to secure reasonably necessary information from third parties as required in this subseatJon, unless prohibited by law or governmental regulation. shall terminate any liability of the Company under this policy as to that claim. OPTIONS TO PAY OR O~.IERWlSE SETTLE CLAIMS; TERMINATION OF UABILITY In case of a claim under this policy, the Company shall have the following additional options: (al To Pay or Tender Payment of the Amount of insurance. To pay or tender payment of the Amount of Insurance under this policy togather with any costs, attorneys' fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment or tender of payment and that the Company is obligated to pay. Upon the exercise by the Company of this option, all liability and obligations of the Company to the Insured under this policy, other than to make the payment required in this subsection, shall terminate, ieeleding any liability or obligation to defend, prosecute, or continue any litigation. {b) To Pay or Othem4se Sattie With Pat[les Other Than the Insured or With the Insured Claimant. (il To pay or otherwise settle with other parties lot or in the name of an Insured Claimant any elaim insured against under this policy. In addition, the Company will pay any costs, attorneys' tees, and expanses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay; or (ii) TO pay or otherwise settle with the Insured Claimant the lose or damage provided for under this policy, together with any costs, attorneys' fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay. Upon the exercise by the Company of either of the options provided for in subsections (b){i) or (ii), the Company's obligations to the Insured under this policy for the claimed loss or damage, ether than the payments required to be made, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation I Page 3 Serial No.: O 8911-556600 ~ Fila No: ST10-09332 CONDITIONS (Continued) 8. DETERMINATION AND EXTENT OF UABILITY This policy is a contract of indemnity against actual monetary loss or damage sustained or incurred by the Insured Claimant who has suffered loss or damage by reason of matters insured against by this policy (a) The extent of liability of the Company for loss or damage under this policy shall not exceed the lesser of (i) the Amount of Insurance; or (ii) the difference between the value of the Title as insured and the value of the Title subject to the risk insured against by this policy. (t)) If the Company pursues its rights under Section 5 of these Conditions and is unsuccessful in establishing the Title, as insured. (i) the Amount of Insurance shall be increased by 10%, and (ii) the Insured Claimant shall have the right to have the loss or damage determined either as of the date the claim was made by the Insured Claimant or as of the date it is settled and paid. (c) In addition to the extent of liability under (a) and (b). the Company will also pay those costs, attorneys' lees, and expenses incurred in accordance with Sections 5 and 7 of these Conditions. 9, LIMITATION OF LIArtlUTY (a) If the Company establishes the Title, or removes the alleged defec[, lien. or encumbrance, or cures the lack of a right of access to or from the Land, or cures the claim of Unmarketable TAle, all as insured, in a reasonably diligent manner by any method, including litigation and the completion of any appeals, it shall have fully podormed its obligations with respect to that matter and shall not be liable for any loss or damage caused to the Insured. (b) In the event of any litigation, including litigation by the Company or with the Company's consent, the Company shall have no liability for loss or damage until there has been a final determination by a court of competent jurisdiction, and disposition of all appeals, adverse to the Title, as insured. (c) The Company shall not be liable for loss or damage to the Insured for liability voluntarily assumed by the Insured in settling any claim or suit without the prior written consent of the Company. 10, REDUCTION OF INSURANCE; REDUC"[1ON OR TERMINATION OF LIABILITY All paymeets under this policy, except payments made for costs, attorneys' fees, and expenses, shall reduce the Amount of Insurance by the amount of the payment. 11. LIABILITY NONCUMULATIVE The Amount of Insurance shall be reduced by any amount the Company pays under any policy insuring a Mortgage to which exception is taken in Schedule B or to which the Insured has agreed, assumed, or taken subject, or which is executed by an Insured after Date of Policy and which is a charge or lien on the Title, and the amount so paid shall be deemed a payment to the Insured under this policy. 1Z PAYMENT OF LOSS When liabiliiy and the extent of loss or damage have been definitely fixed in accordance with these Conditions, the payment shall be made within 30 days, v 13. RIGHTS OF RECOVERY UPON PAYMENT OR SE'rR.EMEHT (a) Whenever the Company shall have settled and paid a claim under this policy, it shall be subrngeted and entitled to the rights of the Insured Claimant in the Title and all other rights and remedies in respect to the claim that the Insured Claimant has against any person or property, to the extent of the amount of any loss, costs, attorneys' fees, and expenses paid by the Company. If requested by the Company, the insured Claimant shall execute documents to evidence the transfer to the Company of these rights and remedies. The ~nsured Claimant shall permit the Company to sue, compromise, or setlle in the name of the Insured Claimant and to use the name of the Insured Claimant in any transection or litigation involving these rights and remedies, if a payment on account of a claim does not fully cover the loss of the Insured Claimant, the Company shall defer the exercise of its right to recover until after the Insured Claimant shall have recovered its loss. (P) The Company's right of subrogation includes the rights of the Insured to indemniites, guaranties, other policies of insurance, or bends, notwithstanding any terms or conditions contained in those instruments that address subrogation rights. 14. AR BFI~ATION Either the Company or the Insured may demand that the claim or controversy shall be submitled to arbitration pursuant to the Title Insurance Arbitration Rules of the American Land Title Association {"Rules"). Except as provided in the Rulas, there shait be no joieder or ceeeelidation with claims or controversies of other persons. Arbitrable matters may include, but are not limited to, any controversy or claim between the Company and the Insured arising out of or relating to this peiley, any service in connection w~th its issuance or the breach of a policy provision, or to any other controversy or claim arising out of the transaction giving dse to this policy~ All arbitrable matters when the Amount of Insurance is $2,000,000 or lass shall be arbitrated at the option of either the Company or the Insured. Alt arbitrable matters when the Amount of Insurance is in excess of $2,000,000 shall be arbitrated only when agreed to by both the Company and the Insured, Arbitration pursuant 1~ this policy and under the Rules shall be binding upon the parties. Judgment upon the award rendered by the Arbitrator(s) may be entered in any cour[ of competent jurisdiction. 15. EABILITY MMITED TO THIS POLICY; POMCY ENTIRE CON~ACT (a) This policy together with all endorsements, if any, attached to it by the Company is the entire policy and contract between the insured and the Company. In interpreting any provision gl this policy, this policy shall be construed as a whole, (b) Any claim of loss or damage that arises out of the status of the Title or by any action asserting such claim shall be restricted to this policy, (c) Any amendment of or endorsement to this policy must be in writing and authenticated by an aatherized person, er expressly incorporated by Schedule A gl this policy. (d) Each endorsement to this policy issued at any time is made a port gl this polioy and is subject to all of its terms and provisions. Except as the endorsement expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsement, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance, t6. SEVERABILFI'Y In the event any provision of this policy, in whole or in pad, is held invalid or unenforceable under applicable law, the policy shall be deemed not to include that provision or such part held to be invalid, bat all other provisions shall remain in tall force and effect. 17. CHOICE gE LAW; FORUM (a) Choice of Law: The Insured acknowledges the Company has underwrttten the risks covered by this policy and determined the premium charged therefore in reliance upon the law affecting interests in ree~ property and applicable to the interpretation, rights, remedies, or enforcement of policies of title insurance of the jurisdiction where the Land is located. Therefore, the court or an arbitrator shall apply the law of the jur~diction where the Land is located to determine the validity of claims against the TCLle that are adverse to the Insured and to interpret and enforce the terms of this policy. In neither case shall the court or arbitrator apply its conflicts of !aw principles to determine the applicable law. (c) Choice of Forum: Any litigation or other proceeding brought by the Insured against the Company must be filed only in a state or federal court wirbin the United States of Amedca or its territories having appropriate jedsdictlen. 18, NOTICES, WHERE SENT Any notice of claim and any other nolice or slalement in writing required to Serial No.: O-8911 556600 File No: ST10-09332 ALTA OWNER'S POLICY (6/I 7t06} SCHEDULEA File No.: Amount of Insurance: Date of Policy: 1. ST10-09332 Policy No.: O-8911-556600 $502,796.70 Premium: $2,153.00 December 9, 2010 Name of Insured: Town of Southold The estate or interest in the Land that is insured by this policy is: Development Rights Easement Title is vested in: Town of Southold who acquired Developlnent Rights by Grant of Development Rights Easement by KKP, LLC dated 12/9/2010 to be duly recorded in the Suffolk County Clerk's/Registers Office. 4. The Land referred to in this policy is described as follows: See Schedule A Description, attached hereto and made a part hereof. Section: 120.00 Block: 03.00 Lotp/c011.009 ALTA OWNER'S POLICY (6/17106) File No.: ST10-09332 SCHEDULE A DESCRIPTION Policy No.: O-8911-556600 DEVELOPMENT RIGHTS EASEMENT AREA ALL that certain plot, piece or parcel of land, situate, lying and being in the Hamlet of Mattituck, Town of Southold. County of Suffolk and State of New York, bounded and described as follows: BEGINNING at a point on the southerly side of Sound Avenue distant the following two (2) courses and distances fi'om the corner formed by the intersection of the southerly side of Sound Avenue with the westerly side of Mdt'ich Lane (Ehsha's Lane): North 89 degrees 54 minutes 00 seconds West, 489.07 feet; South 88 degrees 13 minutes 50 seconds West, 119.94 feet to the true pomi or place of beginning; RUNNING THENCE along land now or formerly of Harbes Farm Riverhead East, LLC and through a concrete monument, South 19 degrees 59 minutes 10 seconds East, 1,389.36 feet to land now or formerly of P&E, LLC (Town of Southold Development Rights); THENCE along said land South 71 degrees 31 minutes 30 seconds West, 305.21 feet to land now or formerly of Patricia Divello; THENCE along said land North 19 degrees 53 minutes 50 seconds West, 1,120.73 feet to a point; THENCE North 70 degrees 06 minutes 10 seconds East, 253.42 feet to a point; THENCE North 19 degrees 59 minutes 10 seconds West, 277.45 feet to the southerly side of Sound Avenue; THENCE along the southerly side of Sound Avenue North 88 degrees 13 minutes 50 seconds East, 52.64 feet to the U'ue point or place of BEGINNING. RESERVE AREA - NOT TO BE INSURED (for informational purposes only) ALL that certain plot, piece or parcel of land, situate, lying and being in the Hamlet of Mattituck, Town of Southold, County of Suffolk and State of New York, bounded and described as follows: BEGINNING at a point on the southerly side of Sound Avenue distant the following three (3) courses and distances from the corner formed by the intersection of the southerly side of Sound Avenue with the westerly side of Aldt'ich Lane (Elisha's Lane): North 89 degrees 54 minutes 00 seconds West, 489.07 feet: South 88 degrees 13 minutes 50 seconds West, 119.94 feet: South 88 degrees 13 minutes 50 seconds West, 52.64 feet to the tree point or place of begi~ming; RUNNING THENCE South 19 degrees 59 minutes 10 seconds East, 277.45 feet to a point: THENCE South 70 degrees 06 minutes 10 seconds West, 253.42 feet to land now or formerly of Patricia Divello: THENCE along said land North 19 degrees 53 minutes 50 seconds West, 351.79 feet to the southerly side of Sound Avenue; ALTA OWNER'S POLICY (6/17/06) THENCE along said southerly side of Sound Avenue the following two (2) courses and distances: North 85 degrees 38 minutes 20 seconds East, 178.42 feet; North 88 degrees 13 minutes 50 seconds East. 85.33 feet to the true point or place of BEGINNING. ACCESS AREA ALL that certain plot, piece or parcel of land, situate, lying and being in the Hamlet of Mathtuck, Town of Southold, County of Suffolk and State of New York, bounded and described as follows: BEGINNING at a point on the southerly side of Sound Avenue distant the following two (2) courses and distances from the comer formed by the intersection of the southerly side of Sound Avenue with the westerly side of Aldrich Lane (Ehsha's Lane): North 89 degrees 54 minutes 00 seconds West, 489.07 feet: South 88 degrees 13 minutes 50 seconds West, 119.94 feet to the true point or place of beginning; RUNNING THENCE along land now or formerly of Harbes Farm Riverhead East, LLC and through a concrete monument, South 19 degrees 59 minutes 10 seconds East, 268.32 feet; THENCE South 70 degrees 00 minutes 59 seconds West, 25.38 feet; THENCE North 19 degrees 59 minutes 10 seconds West, 234.57 feet; THENCE South 85 degrees 59 minutes 29 seconds West, 25.61 feet; THENCE North 19 degrees 59 minutes 10 seconds West, 43.15 feet to the southerly side of Sound Avenue; THENCE along the southerly side of Sound Avenue North 88 degrees 13 minutes 50 seconds East, 52.64 feet to the true point or place of BEGINNING. ALTA OWNER'S POLICY ~6/17/06) SCHEDULE B PART I File No.: ST10-09332 Policy No.: O-8911-556600 This policy does not insure against loss or damage (and the Company will not pay costs, attorneys' fees or expenses) that arise by reason of: 1. Agreements of Non-Interference with Development Rights as set forth in Libel' 12603 Page 141, Liber 12603 Page 142, Liber 12603 Page 143 and Liber 12603 Page 144 (covers premises and more). 2. Survey exceptions set forth as follows: a) Nm-therly line: Access Area located; b) Easterly line: Access Area located; sign located; proposed 10-foot utility easement located; dh't access road located within Access Area varies with part of easterly line; c) Southerly line: Dirt farm road varies with record line; d) Westerly line: Dirt farm road a'averses westerly part of premises As shown on survey made by Nathan Taft Corwin Ill, last dated 11/2/2010. 3. Rights of tenants or parties in possession, if any. 4. Policy will except the terms and conditions of the grant of Development Rights Easement to be executed by the grantor and the Town of Southold. STEWART TITLE INSURANCE COMPANY HEREIN CALLED THE COMPANY STANDARD NEW YORK ENDORSEMENT (Owner's Policy) Title No.: ST10-09332 Date of Issue: December 9, 2010 ATTACHED TO AND MADE A PART OF POLICY NUMBER O~8911-556600 i. The following is added as a Covered Risk: "11. Any statutory lied for services labor or materials furnished prior to the date hereof, and which has now gained or which may hereafter gain priority over the estate or interest of the insured as shown in Schedule A of this policy." 2. Exchision Number 5 is deleted, and the following is substituted: Any lien on the Title for real estate taxes, assessments, water chaxges m' sewer rents imposed by governmeotal authority and created or attaching betweco Date of Policy and the date of recording of the deed or other instrametu of transfer in the Public Records that vests Title as Shown in Schedule A. This endorsement is issued as paxt of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, tiffs endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements. DATED: December 9, 2010 Countersigned By: Authorized Office or Agent STEWART TITLE INSURANCE COMPANY President Secretary Stewart Title Insurance Company 300 East 42nd St., 10th FI New York, New York 10017 STANDARD NEW YORK ENDORSEMENT (11/1/08) FOR USE WITH ALTA OWNER'S POLICY (6-17-06) SUBORDINATION AGREEMENT This Agreement made the )__ day of December, 2010 BETWEEN BRIDGEHAMPTON NATIONAL BANK with offices at 2200 Montauk Highway, Bridgehampton, New York 11932 party of the first pan, and TOWN OF SOUTHOLD, a municipal corporation of the State of New York having its principal office at 53095 Main Road, Southold, New York 11971, a party of the second pan, WITNESS: WHEREAS, the said party of the first part now owns and holds the following mortgages or notes secured thereby: 1. Credit Line Mortgage Dated 12/21/2005 made by EWH Limited Liability Company to Bridgehampton National Bank to secure the principal sum of $500,000, which mortgage was recorded onl/9/2006 in Liber 21207, Page 697 in the Office of the Clerk of the County of Suffolk; 2. Comanercial Real Estate Mortgage Dated 2/23/2009 made by EWH Limited Liability Company to Bridgehampton National Bank to secure the principal sum of $300,000, which mortgage was recorded on 3/18/2009 in Liber 21798, Page 448 in the Office of the Clerk of the County of Suffolk; 3. Commercial Real Estate Mortgage Dated 2/23/2009 made by EWH Limited Liability Company to The Bridgehampton National Bank, to secure the principal sum of $200,000, which mortgage was recorded on 3/18/2009 in Liber 21798 Page 44 in the Office of the Clerk of the County of Suffolk; 4. Spreader A~reement Dated 3/2/2010 made by EWH Limited Liability Company, P & E, LLC and KKP, LLC with the Bridgehampton National Bank which spreads Mortgage Nos., 1, 2 and 3 over Tax Lots 011.9, 011.013 through 011.016 and 0600 011.02-01.00-028.000; 5. Mortgage and Security Agreement Dated 3/2/2010 made by EWH limited Liability Company, P & E, LLC and KKP, LLC, with the Bridgehampton National Bank, to secure the principal sum of $660,000, which mortgage was recorded on 3/29/2010 in Liber 21932 Page 231 in the Office of the Clerk of the County of Suffolk; 6. Mortgage and Security Agreement Dated 3/2/2010 made by EWH Limited Liability Company, P & E, LLC and KKP, LLC to the Bridgehampton National Bank to secure the principal sum of $500,000, which mortgage was recorded on 3/29/2010 in Liber 21932 Page 232 in the Office of the Clerk of the County of Suffolk; WHEREAS, KKP, LLC with an address c/o Peter Harbes, 1002 Bluff Drive North, Baiting Hollow, New York 11933, the present owner of the premises hereinafter mentioned and described in said mortgages is about to execute and deliver to said party of the second part, a Grant of Development Rights Easement conveying and granting an easement upon a portion of the mortgaged premises described in Schedule "A" annexed hereto; and also described in said easement; and WHEREAS, the party of the second part has refused to accept said easement unless said mortgages held by the party of the first part be subordinated in the manner hereinafter mentioned, NOW, THEREFORE, in consideration of the premises and to induce the party of the second part to accept the easement and also in consideration of one dollar paid to the party of the first part, the receipt whereof is hereby acknowledged, the party of the first part hereby covenants and agrees with the party of the seconds part that said mortgages held by the party of the first part be and shall continue to be subject and subordinate to the lien of the Grant of Development Rights Easement dated December 9, 2010 about to be delivered by the Town of Southold simultaneously herewith (the "Easement"). The Easement consists of the limitations, agreements, covenants, use, restrictions, rights and conditions set forth therein, intended to restrict further development of the property while permitting use of the property for agricultural productions and compatible uses thereof as set forth in the Easement. IN WITNESS WHEREOF, the party of the first part has duly executed this Agreement the day and year first above written. Title STATE OF NEW YORK ) ) SS.~ COUNTY OF SUFFOLK ) On the ~l~day of ~(e.~cc~f~in the year 2010, before appeared me, the undersigned, personally personally known to me, or proved to me on the basis of satisfactory evidence, to be the individual ' whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, execute~nstmment. ~ /( No~'y Public~'-~ (~ REGINA GOBCZYK ~ comQUalified in Suffolk County mission Expires April 13, 201~ AFFIDAVIT STATE OF NEW YORK ) ) SS.: COUNTY OF SUFFOLK ) Peter Harbes, being duly swom, deposes and says: I. That I am the Member ofKKP, LLC 2. That since KKP, LLC was formed on June 24, 2003 it has been known by no name other than KKP, LLC. 3. That I make this affidavit knowing that it will be relied upon by Stewart Title Insurance Company in issuing its policy of title insurance. Sworn to before me this day of December, 2010. Notary Public PATRICIA L. FALLON Notary Public, State Of New York No. 01FA4950146 Qualified In Suffolk County., Commission Expires April 24,oZ~// MELISSA A. SPIRO LAND PRESERVATION COORDINATOR melissa.spiro~town.southold.ny.us Telephone (631) 765-5711 Facsimile (631) 765-6640 DEPARTMENT OF LAND PRESERVATION TOWN OF SOUTHOLD OFFICE LOCATION: Town Hall Annex 54375 State Route 25 (corner of Main Rd & Youngs Ave) Southold, New York MAILING ADDRESS: P.O. Box 1179 Southold, NY 11971-0959 To: Supervisor Russell Town Board Town Clerk Land Preservation Committee Town Attorney Planning Board Suffolk County Division of Real Estate Tax Assessors Building Department Data Processing Town Comptroller Stewardship Managers Peconic Land Trust, Inc. The Nature Conservancy From: Melissa Spiro, Land Preservation Coordinator Date: December 10, 2010 Re: KKP~ LLC to TOWN OF SOUTHOLD plo SCTM #1000-'120-3-t 1.19 Please be advised that the Town has acquired a development rights easement on the agricultural property listed below. If you would like additional information regarding the purchase, please feel free to contact me. LOCATION: 750 Sound Avenue, Mattituck SCTM #: part of 1000-120.-3-11.19 PROPERTY OWNER: KKP, LLC (Peter Harbes) CONTACT DATE: November 8, 2010 PURCHASE DATE: Thumday, December 9, 2010 PURCHASE PRICE: $ 502,796.70 (based on 7.9809 buildable acres @ $63,000/buildable acre) TOTALPARCELACREAGE: 10.000 acres EASEMENT ACREAGE: 8.1638 acres (includes 0.1829 acre access area - not included in purchase price) RESERVED AREA: 1.84 acre ZONING: A-C FUNDING: CPF 2% Land Bank MISCELLANEOUS: At time of purchase, a 7,966 sq ft area of Easement is being used for parking, and access to parking and to1 residential dwelling on adjacent property. This 7,966 sq ft area is shown as Access Area on the survey and is further described in the Easement. Although Easement includes this area, purchase did not include payment for the 7,966 sq ft area. CLOSING STATEMENT KKP, LLC to TOWN OF SOUTHOLD Total Development Rights Easement- 8.1638 acres Total Parcel Acreage - 10.000 acres Reserved Area - 1.84 acres (80,000 sq. ft.) Access Area - 0.1829 acre (not included in purchase price) Premises: 750 Sound Avenue, Mattituck Part of SCTM #1000-120.-3-11.9 Closing took place on Thursday, December 9, 2010 at 2:30 p.m., Southold Town Hall Annex Purchase Price of $ 602,796.70 (based upon 7.9809 buildable acres $63,0001buildable acre) disbursed as follows: Payable to Bridgehampton National Bank Check #107976 (121912010) $ 460,000.00 Payable to KKP, LLC Check #107979 (121912010) $ 49,741.70 Payable to Charles R. Cuddy, Esq. Check #107977 (12/9/20 I0) $ 3,055.00 Expenses of Closing: Appraisal Payable to Eiinor Brunswick, MAI Check #107082 (101512010) $ 1,750.00 Survey Payable to Nathan Taft Corwin III Land Surveyor Check #108265 (12/14/2010) $ 2,300.00 Environmental Report (Phase I ESA) Payable to Nelson, Pope & Voorhis, LLC Check #108089 (11/30/2010) $ 1,100.00 Title Report Payable to Stewart Title Insurance Company Check #107980 (1219/2010) Title insurance policy $ 2150 Recording easement $ 275 Certified Copy $ 50 $ 2,475.00 Title Closer Attendance Fee Payable to Patricia Fallon Check #107978 (12/9/2010) $ 100.00 Those present at Closing: Lisa Clare Kombrink, Esq. Peter Harbes Charles R. Cuddy, Esq. Patricia Fallon Melissa Spiro Melanie Doroski Attorney for Town of Southold Seller Attorney for Seller Title Company Closer Land Preservation Coordinator Land Preservation Sr Administrative Asst TOWN OF SOUTHOLD VENDOR 002640 BRIDGEHAMPTON NATIONAL BANK 12/09/2010 CHECK 107976 FUND & ACCOUNT P.O.# INVOICE DESCRIPTION AMOUNT H3 .8660.2.600.100 TBR899 120910 KKP-8.1638 ACR DEV RGHTS 450,000.00 TOTAL 450,000.00 TOWN OF SOUTHOLD VENDOR 011435 KKP, LLC 12/09/2010 CHECK 107979 FUND & ACCOUNT P.O.# INVOICE DESCRIPTION AMOUNT H3 .8660.2.600.100 TBR899 120910 KKP-8.1638 ACR DEV RGHTS 49,741.70 TOTAL 49,741.70 lob 0"' TOWN OF SOUTHOLD VENDOR 003715 CHARLES R CUDDY AS ATTORNEY 12/09/2010 CHECK 107977 FUND & ACCOUNT P.O.~ INVOICE DESCRIPTION AMOUNT H3 .8660.2.600.100 TBR899 120910 KKP-SELLER'S LEGAL FEE 3,055.00 TOTAL 3,055.00 BRUNSWICK APPRAISAL CORP. REAL ESTATE APPRAISERS AND CONSULTANTS 44 Elm Street, Suite 8 HUNTINGTON, NEW YORK 11743 (631 ) 421-2344 FAX (631 ) 424-9246 E-Mail: etinor~bmnswickappraisl.com Sanford S. Brunswick Elinor Brunswick, MAI State Certified General Appraisers Armand Brunswick, MAI 1881-1960 September 8, 2010 Town of Southold Department of Land Preservation Southold Town Hall Annex 54375 State Route 25 P.O. Box 1179 Southold, New York 11971-0959 Attention: Melissa A. Spko, Land Preservation Coordinator Development Rights Easement Acquisition KKP, LLC. Property 750 Sound Avenue Mattimck, New York Tax MapNumber: I000-120-3-11.009 INVOICE# 1000-17 Real Estate Appraisal $1,750 Thank you DEPT. OF LAND PRESERVATION TOWN OF 80UTHOLD VEeR 00S409 BLINOR BRUNSWICK, MAI 10/05/2010 CHECK 107082 FUND & ACCOUNT P.O.# INVOICE DESCRIPTION AMOUNT H3 .8660.2.500.200 21561 1000-17 APPRAISAL-750 SOUND AVE 1,750.00 TOTAL 1,750.00 ,.% NATHAN TAFT CORWIN III LAND SURVEYOR, P.C. P.O. BOX 16 Jamesport, New York 11947 Office Location: 1586 Main Road, Jamesport NY Phone # 631-727-2090 Fax# 631-727-1727 Bill To Town of Southold Department of Land Preservation P.O. box I 179 Southold, New York 11971 Att: Melissa Invoice Date Invoice # 12/1/2010 3941 Survey (POrt21565) I Job # I Client: I 30-262 Description Terms I S.C. Tax Lot No. 30 DAYS I 1000-120-03-11.9 Amount 2,300.00 GL108S 20 TOWN OF SOUTHOLD View i ** Actual Hi Vendor.. 013975 NATHAN T CORWIN III Y=Select JE Date Trx. Date Fund Account ............................. Begi ., 10/09/2007 10/09/2007 H3 .600 .. 2/03/2009 2/03/2009 H3 .600 6/30/2009 6/30/2009 A .600 [~ 12/14/2010 12/14/2010 H3 .600 F2=Shift Up F3=Exit F10=Prev View Select Record(s) or Use Action Code Disburs Inquiry by Vendor Name .............. Detail--GL100N ............. : W-12142010-498 Line: 325 Formula: 0 : Account.. H3 .600 : Acct Desc ACCOUNTS PAYABLE : Trx Date ..... : Trx Amount... : Description.. : Vendor Code.. : Vendor Name.. : Alt Vnd.. : CHECK ........ 108265 SCNB 12/14/2010 SDT 12/15/10 2,300.00 SURVEY KKP,LLC(HARBES) 013975 Pay Method: NATHAN T CORWIN III : Invoice Code. 3941 : VOUCHER ...... : P.O. Code .... 21565 : Project Code. : Final Payment F Liquid. : Type of 1099. N BOX. : Fixed Asset.. Y : Date Released 12/14/2010 : Date Cleared. 12/31/2010 Addl. : F3=Exit F12=Cancel : TOWN OF SOUTHOLD VENDOR 013975 NATHAN T CORWIN III 12/14/2010 CHECK 108265 FUNqD & ACCOUNT P.O.g INVOICE DESCRIPTION Da~OUNT H3 .8660.2.600.100 21565 3941 SURVEy KKP, LLC(H~RBES) 2,300.00 TOTD~L 2,300.00 [ Invoice J Nelson Pope & Voorhis, LLC 572 Walt Whitman Road Melville, NY 11747 (631) 427-5665 Melissa Spiro Town of Southold Dept of Land Preserv Town Hall 53095 State Rt 25, PO Box 1179 Southold. NY 11971 November 19, 2010 Project No: V10X156,001.000 Invoice No: 7861 Project Manager Steve~ McGinn Project V10X156.001.000 KKP. LLC Property, Mattituck Professional Services .......Phase ' ....... -S-~ ......... ~ ........................................................... Task 1300 PhaselESA Contract dated October 11, 2010: Item 1. Prepare Phase I Environmental SiteAssessment Work Performed thru 10/27/10 Fee Total Fen 1, t00.00 Percent Complete fOO.OO Total Earned 1,100.00 Previous Fee Billing 0.00 Current Fee Billing 't,'{13(I.0{) Total Fee Tdtal~is Task $1,1(~L00, Total this Phase $1,100~00 Total this Invoice $1,100.00 GL108S 20 TOWN OF SOUTHOLD View 1 ** Actual Hi Vendor.. 014161 NELSON, POPE & VOOR Y=Select JE Date Trx. Date Fund Account ......................... Use Acti .. 10/19/2010 10/19/2010 A .600 .Y. 11/30/2010 11/30/2010 H3 .600 F2=Shift Up F3=Exit F10=Prev View Select Record(s) or Use Action Code Disburs Inquiry by Vendor Naa .............. Detail--GL100N ............. : W-11302010-338 Line: 184 Formula: 0 : Account.. H3 .600 : Acct Desc ACCOUNTS PAYABLE : Trx Date ..... 11/30/2010 SDT 11/29/10 : Trx Amount... 1,100.00 : Description.. PHASE I ESA-KKP,LLC-MTTK : Vendor Code.. 014161 : Vendor Name.. NELSON, POPE & VOORHIS, : Alt Vnd.. : CHECK ........ 108089 SCNB : Invoice Code. 7861 : VOUCHER ...... : P.O. Code .... 21564 : Project Code. : Final Palnnent F Liquid. : Type of 1099. M BOX. 07 Addl. : Fixed Asset.. Y : Date Released 11/30/2010 : Date Cleared. : F3=Exit F12=Cancel : TOWN OF SOUTHOLD VENDOR 014161 NELSON, POPE & VOORHIS, LLC 11/30/2010 CHECK 108089 FUND & ACCOUNT P.O.~ INVOICE DESCRIPTION AMOUNT H3 .8660.2.600.100 21564 7861 pHASE 1 ESA-KKP,LLC-MTTK 1,100.00 TOTAL 1,100.00 ]1, O"' STEWART TITLE INSUR_A~CE COMPANY 707 Westchester Avenue, Suite 411, White Pla/ns, New York 10604 Phone: 800-433-4698 or 914-993-9393 Fax: 914-997-1698 FAIR ~AIK, ET VALUE RIDER (Optio~ml) PREMIUM MORTGAGE INSURANCE COVEI~4GE PREMIUM Residential Adjastable Rate Rider MORTGAGE T~X (Mo~gagee) COMMUNI~ PRESERVATION FUND DEPARTMENT~ SEARCHES STREET ~PORT ESCROW DEPOSIT FEE ( ) MORTGAGE ~FIDA~T(S) ( ) ASSIGNMENT(S) CLOSER CHARGES, 1F ANY: PICK-UP FEE OTHER: PATRICIA L. FALLON Title Closer TOWN OF SOUTHOLD VENDOR 019624 STEWART TITLE INSOPJ%NCE CO. 12/09/2010 CHECK 107980 FUND & ACCOUNT P.O. ~ INVOICE DESCRIPTION AMOUNT H3 .8660.2.600.100 .8660.2.600.100 H3 .8660.2.600.100 TBR899 ST10-09332A TBR899 ST10-09332B TBR899 ST10-09332C KKP,LLC-TITLE INS.POLICY 2,150.00 KKP,LLC-RECORD.EASEMENT 275.00 KKP-CERT COPY RECD EASMT 50.00 2,475.00 Il' TOWN OF SOUTHOLD VENDOR 006013 PATRICIA FALLON 12/09/2010 CHECK 107978 FUND & ACCOUNT P.O.~ INVOICE DESCRIPTION AMOUNT H3 .8660.2.600.100 TBR899 ST10-09332 KKP,LLC-TITLE CLOSE.FEE 100.00 TOTAL 100.00 "' ,"' ~:OS~'L, Ofl,~,L,': OOOOOh O,'