Agenda, first session — Fairfield City Council, July 7, 2026 (part 2 of 5)

Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD Based Paint Disclosure Statement and pamphlet, a completed Real Estate Transfer Disclosure Statement in compliance with Sec. 1102 of the California Civil Code, a Natural Hazard Disclosure Statement or the Local Option Real Estate Transfer Disclosure Statement, if so required by the local jurisdiction where the Property is located, notice or actual knowledge of the release of illegal controlled substance and notice of special tax and/or assessments (or, if allowed, a substantially equivalent notice regarding the Mello -Roos Community Facilities and Improvement Bond Act of 1915). Notwithstanding the foregoing, Seller shall not be required to deliver any of the following documents: (a) any proposals, letters of intent, draft contracts and the like prepared by or for other prospective purchasers of the Property; or (b) Seller's internal memoranda, attorney -client privileged documents or privileged communications or appraisals. Although Seller has agreed to make available to Buyer information regarding the Property, Seller and its agents shall have no responsibility or liability for the completeness or accuracy of such information, Seller is making no representation with respect to such documents and information, Buyer assumes and accepts the entire responsibility for interpreting and assessing the information provided and Buyer will rely solely on Buyer's own judgment in making Buyer's decision to purchase the Property.

3.3 Buyer's Due Diligence Documents. If this Agreement terminates, but only if requested in writing by Seller, Buyer shall promptly deliver to Seller all studies, reports, surveys and other information and materials Buyer has received, prepared or obtained pertaining to the Property.

4. Inspection and Cooperation.

4.1 Inspection, Site Work. Seller shall allow Buyer and its consultants access to the Property, following the mutual execution of this Agreement, until the Due Diligence Deadline Date, for purposes of inspecting the Property. With respect to any inspection or testing that is invasive or involves removing or demolishing any portion of the Property, Buyer must first submit to Seller a written plan for any such invasive testing which shall include a plan to deal with any Hazardous Substances (defined in Section 9.3.2) that may be encountered during such testing, and Buyer may not proceed with any such invasive testing unless Seller has approved of Buyer's plan in writing, which approval shall not be unreasonably withheld, conditioned or delayed. Buyer shall conduct any such invasive testing in strict accordance with the plan approved by Seller.

Buyer shall reasonably repair and restore areas of the Property affected by Buyer's inspections so they are in substantially the same condition as before such inspection promptly after each inspection.

4.2 Indemnity. From and after the Effective Date, Buyer hereby agrees to indemnify, defend, protect and hold harmless Seller and any and all officials, agents, employees and representatives of Seller ("Indemnified Parties"), from and against all losses, liabilities, claims, damages, penalties, fines, forfeitures, costs and expenses (including all reasonable out-of- pocket litigation costs and reasonable attorney and expert fees) and demands of any nature whatsoever, related directly or indirectly to, or arising out of or in connection with:

4.2.1 Any breach or default by Buyer under this Agreement;

4.2.2 any of Buyer's activities on the Property (or the activities of Buyer's agents, employees, lessees, representatives, licensees, guests, invitees, contractors, subcontractors

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD or independent contractors on the Property), including, without limitation, construction and operation of improvements on the Property, except such liability, claims, damages, costs and expenses as might accrue from the mere discovery of pre-existing physical conditions or hazardous or toxic materials during inspection of the Property; and

4.2.3 any other acts, occurrences, omissions or other matters that take place or exist on the Property after the close of escrow, In each case, regardless of whether such losses, liabilities, claims, damages, penalties, fines, forfeitures, costs, expenses and demands shall accrue or are discovered before or after termination or expiration of this Agreement. Seller may in its discretion, and at its own cost, participate in the defense of any such legal action. The provisions of this Section 4 shall survive the close of escrow or the termination of this Agreement as applicable.

5. Buyer's Due Diligence Contingency. Buyer's obligation to close this transaction shall be subject to Buyer's approval, in its sole and absolute discretion, of all aspects of the Property, including, without limitation, the condition of title to the Property and the physical, environmental, governmental and zoning condition of the Property (collectively, the "Due Diligence Contingencies") and the satisfaction or waiver by Buyer of such conditions on or before the date that is thirty (30) days after the Effective Date (the "Due Diligence Deadline Date").

Without limiting the foregoing, if Buyer obtains a Phase I environmental report that recommends additional inspections/studies, such as a Phase II environmental report, then Buyer may terminate this Agreement based on the inability to complete such studies prior to the Due Diligence Deadline Date (it being understood the parties may, but are not obligated to, agree on an extension of such time period). If Buyer does not deliver to Seller a written notice terminating this Agreement on or before the Due Diligence Deadline Date, then Buyer shall be deemed to have waived the Due Diligence Contingencies and the Earnest Money shall be non-refundable except as otherwise expressly provided herein.

6. Closing; Title Insurance.

6.1 Time of Closing; Title Insurance Condition. The purchase of the Property shall be closed in escrow at the Title Company ("Closing"). The time for Closing (the "Closing Date") shall be on or before the date that is thirty (30) days after the date Buyer waives (or is deemed to have waived) the Due Diligence Contingencies. However, it shall be a condition to Buyer's obligations to close that the Title Company is irrevocably committed to issue to Buyer an extended coverage owner's title policy in the amount of the Purchase Price insuring that Buyer is the owner of the Property, subject only to the Permitted Exceptions (the "Title Policy").

6.2 Events of Closing.

6.2.1 Seller's Deposits. At least one (1) business day prior to the Closing Date, Seller shall deliver to the Title Company, the following: (a) an executed and acknowledged grant deed (the "Grant Deed") conveying fee simple title to the Property to Buyer subject only to the Permitted Exceptions; (b) such funds as are required to pay for costs and expenses payable by Seller hereunder; (c) such proof of Seller's authority and authorization to enter into this transaction, N

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD and such other documents, as the Title Company may reasonably require in order to issue the Title Policy (including Title Company's standard owner's affidavit) or close this transaction.

6.2.2 Buyer's Deposits. At least one (1) business day prior to the Closing Date, Buyer shall: (a) pay into escrow the Purchase Price less any credit to Buyer pursuant to this Agreement (including the credit for the Earnest Money deposits in the amount of One Hundred Thousand Dollars ($100,000); (b) pay any funds that are required to pay for costs and expenses payable by Buyer hereunder; and (c) issue such proof of Buyer's authority and authorization to enter into this transaction, and such other documents, as the Title Company may reasonably require to issue the Title Policy or close this transaction.

6.2.3 Closing. In order to effectuate the Closing, the Title Company shall (when it is irrevocably committed to issue the Title Policy in the form required by this Agreement, and has received confirmation from Buyer and Seller that all conditions to Closing have been satisfied or will/should be satisfied as of Closing): (a) record the Grant Deed; and (b) deliver the Purchase Price, subject to adjustments based on prorations, if applicable, less the credits described in Section 6.2.2 above, to Seller.

6.3 Income and Expenses.

6.3.1 General. The following items in this Section 6.3 shall be adjusted and prorated between Seller and Buyer as of 12:01 a.m. on the Closing Date. Such adjustments and prorations shall be calculated on the actual days of the applicable month and all annual prorations based upon a three hundred sixty-five (365)-day year.

6.3.2 Property Taxes and Assessments. Assessments for the current tax year levied or assessed against the Property shall be prorated as of the Closing Date. If the amount of assessments for the current tax year has not been fixed by Closing, the proration shall be based upon the taxes paid for the previous year and re -prorated at the time the amount of assessments for the current tax year has been fixed. Seller is exempt from property taxes; consequently, no property taxes shall be allocated to Buyer by proration. Buyer shall be responsible for any applicable taxes following the Closing Date.

6.3.3 Closing Costs. To the extent applicable, Seller shall pay: (i) any county documentary transfer or transaction taxes or fees due on the transfer of the Property and (ii) fifty percent (50%) of the premium for the Title Policy. To the extent applicable, Buyer shall pay: (a) the balance of the premium for the Title Policy (including costs of endorsements, extended coverage and related survey costs) and (b) any escrow fee and recording fees charged by the Title Company. Any costs and expenses of Closing that are not expressly identified above shall be allocated between the parties in accordance with prevailing custom in Solano County, California, or if no custom is ascertainable, fifty percent (50%) by Seller and fifty percent (50%) by Buyer.

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7. Risk of Loss.

7.1 Damaize. In the event that, prior to the Closing Date, the Property, or any part thereof, is destroyed or suffers damage in excess of five percent (5%) of the Purchase Price, Buyer shall have the right, exercisable by giving notice of such decision to Seller within ten (10) business days after receiving written notice of such damage or destruction, to terminate this Agreement. If the damage is greater than five percent (5%) of the Purchase Price and Buyer does not timely elect to terminate this Agreement, Buyer shall accept the Property in its then condition, and all proceeds of insurance awards payable to Seller by reason of such damage or destruction shall be paid or assigned to Buyer. In the event of damage to the Property and the immediately preceding two (2) sentences are not applicable, Buyer shall accept the Property in its then condition and proceed with the purchase and Seller shall assign to Buyer all applicable insurance proceeds.

7.2 Condemnation. If after the Effective Date, and prior to the Closing Date, all or any substantial portion of the Property (where the value of the condemned Property is in excess of five percent (5%) of the Purchase Price), being subjected to a bona fide threat of condemnation by a body having the power of eminent domain, or being taken by eminent domain or condemnation (or sale in lieu thereof), Buyer may by written notice to Seller within ten (10) business days after receiving notice of such event, elect to cancel this Agreement prior to Closing hereunder, in which event both parties shall be relieved and released of and from any further liability hereunder, and any consideration paid hereunder shall forthwith be returned to Buyer and thereupon this Agreement shall become null and void and be considered canceled. If no such election is made, this Agreement shall remain in full force and effect and, upon Closing, the purchase contemplated herein, less any interest taken by eminent domain or condemnation, shall be effected and the Purchase Price for the Property shall not be reduced by the amount of any awards that have been or that may thereafter be made for the taking of the Property (but the condemnation award shall be paid to Buyer).

Default; Remedies.

8.1 Time of Essence. Time is of the essence of the parties' obligations under this Agreement.

8.2 Buyer's Failure to Close. In the event that Buyer is obligated to pay the Purchase Price and fails to do so, then Seller, as Seller's sole remedy, shall be entitled to retain the Earnest Money deposited by Buyer (and all interest earned thereon) as liquidated damages.

BUYER AND SELLER HEREBY AGREE THAT A REASONABLE ESTIMATE OF THE

TOTAL DAMAGES THAT SELLER WOULD SUFFER IN THE EVENT THAT BUYER

DEFAULTS AND FAILS TO COMPLETE THE PURCHASE OF THE PROPERTY IS AN AMOUNT EQUAL TO ALL OF THE EARNEST MONEY. SUCH AMOUNT WILL BE

THE FULL, AGREED AND LIQUIDATED DAMAGES FOR BUYER'S DEFAULT OR FAILURE TO COMPLETE THE PURCHASE OF THE PROPERTY. IF THE EARNEST

MONEY IS DEEMED NON-REFUNDABLE, THE ENTIRE AMOUNT OF THE

EARNEST MONEY, PLUS ACCRUED INTEREST, SHALL BE RETAINED BY SELLER AS LIQUIDATED DAMAGES. BUYER AND SELLER HEREBY ACKNOWLEDGE AND

AGREE THAT SELLER'S DAMAGES IN THE EVENT OF SUCH A BREACH OF THIS Con

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD

AGREEMENT BY BUYER WOULD BE DIFFICULT OR IMPOSSIBLE TO

DETERMINE, THAT THE AMOUNT OF THE EARNEST MONEY PLUS ACCRUED

INTEREST IS THE PARTIES' BEST AND MOST ACCURATE ESTIMATE OF THE

DAMAGES SELLER WOULD SUFFER IN THE EVENT THE TRANSACTION

PROVIDED FOR IN THIS AGREEMENT FAILS TO CLOSE AND THAT SUCH

ESTIMATE IS REASONABLE UNDER THE CIRCUMSTANCES EXISTING ON THE DATE OF THIS AGREEMENT. BUYER AND SELLER AGREE THAT SELLER'S

RIGHT TO RETAIN THE EARNEST MONEY PLUS ACCRUED INTEREST SHALL BE

THE SOLE REMEDY OF SELLER AT LAW IN THE EVENT OF A BREACH OF THIS

AGREEMENT BY BUYER, AND AFTER PAYMENT THEREOF TO SELLER,

NEITHER PARTY SHALL HAVE ANY FURTHER OBLIGATION TO OR RIGHTS AGAINST THE OTHER.

ACCEPTED AND AGREED TO
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Seller Buyer

8.3 Seller's Failure to Close. In the event that Seller is obligated to convey the Property to Buyer but fails to do so, then Buyer, as Buyer's sole remedy, shall be entitled to a return of the Earnest Money deposited by Buyer (and all interest earned thereon).

WAIVER OF RIGHT TO SPECIFIC PERFORMANCE. IF SELLER FAILS TO CONVEY

THE PROPERTY TO BUYER IN ACCORDANCE WITH THE PROVISIONS OF THIS

AGREEMENT, AND SUCH FAILURE CONSTITUTES A DEFAULT UNDER THIS

AGREEMENT, THEN BUYER WILL BE ENTITLED TO THE RETURN OF THE

DEPOSIT AND ALL INTEREST ACCRUED ON THAT DEPOSIT WHILE IN ESCROW,

BUT BUYER WILL NOT HAVE THE RIGHT TO RECEIVE ANY EQUITABLE RELIEF,

INCLUDING, WITHOUT LIMITATION, THE RIGHT TO RECORD A LIS PENDENS

AGAINST THE PROPERTY UNDER APPLICABLE LAW OR TO PURSUE THE

SPECIFIC PERFORMANCE OF THIS AGREEMENT, BUT BUYER WILL HAVE THE

RIGHT TO PURSUE AN ACTION FOR DAMAGES AGAINST SELLER RELATIVE TO SUCH DEFAULT. SELLER AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THIS SECTION 8.3 AND, BY THEIR INITIALS IMMEDIATELY BELOW, AGREE TO BE BOUND BY ITS TERMS.

ACCEPTED AND AGREED TO
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Seller Buyer

9. Representations and Covenants.

9.1 Seller's Representations. Seller's representations contained in this Section

9.1 are true and accurate in all material respects and shall survive Closing for a period of one (1) calendar year. Seller's representations contained in this Section 9.1 shall be continuing and shall be true and correct as of the Closing Date with the same force and effect as if remade by Seller in a separate certificate at that time; provided, however, if Seller becomes aware after the date of this 7

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD Agreement that any representation by Seller is untrue in any material respect, Seller shall give Buyer written notice of such change in Seller's representation and Buyer shall have seven (7) business days to terminate this Agreement by written notice to Seller and receive a refund of the Earnest Money, but the failure of Buyer to timely terminate this Agreement shall be deemed a modification of such representation and Seller shall only be obligated to remake such representation at Closing as so modified. Seller's representations are based on Seller's actual knowledge (as used herein, "Seller's actual knowledge" means the actual and present knowledge of Seller without investigation or inquiry). In no event shall the foregoing affect Seller's disclosure obligations under California law as a seller of real property.

9.1.1 Seller has full power and authority to enter into and perform this Agreement in accordance with its terms, and all requisite action has been taken by Seller in connection with the execution of this Agreement and the transactions contemplated hereby.

9.1.2 Seller has not received written notice of, and is not otherwise aware of, any Hazardous Substances stored or disposed on the Property in violation of any applicable law.

9.1.3 There is no condemnation proceeding, litigation, action, suit or proceeding pending or threatened, in writing within twelve (12) months prior to the date of this Agreement, that affects the Property.

9.1.4 Seller is not a "foreign person" within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended.

9.1.5 Seller has not received any written notice of violation of any law or ordinance affecting the Property.

9.1.6 There are no leases or occupancy agreements affecting the Property.

9.2 Seller's Covenants. Seller covenants that, until the Closing Date or escrow is terminated, whichever comes earlier, Seller shall operate and maintain the Property in a manner consistent with Seller's past practices. Seller shall not execute any lease, license or other agreement for the use of the Property.

9.3 As -Is Sale and Purchase. Buyer acknowledges, by its initials as set forth below, that the provisions of this Section 9.3 have been required by Seller as a material inducement to enter into the contemplated transactions, and the intent and effect of such provisions have been explained to Buyer by Buyer's counsel and have been understood and agreed to by Buyer subject, however, to Seller's disclosure obligations under California law as a seller of real property. As a material inducement to Seller to enter into this Agreement and to convey the Property to Buyer, Buyer hereby acknowledges and agrees that, subject to Seller's disclosure obligations under California law as a seller of real property:

9.3.1 AS -IS. Except as otherwise expressly set forth in this Agreement (including, without limitation, Section 9.2) or in any certificate, instrument or other document executed by Seller pursuant to this Agreement (collectively, the "Closing Documents"), and subject to Seller's representation and warranties set forth in this Agreement or in any of the Closing

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD Documents, Buyer is purchasing the Property in its existing condition, "AS -IS, WHERE -IS, WITH ALL FAULTS," and upon the Closing Date has made or has waived all inspections and investigations of the Property and its vicinity that Buyer believes are necessary to protect its own interest in, and its contemplated use of, the Property.

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Buyer's Initials

9.3.2 No Representations. Other than the express representations and warranties and covenants of Seller contained in this Agreement or in any of the Closing Documents, neither Seller, nor any person or entity acting by or on behalf of Seller, nor any direct or indirect member, partner, officer, director or employee of Seller, nor any agent, affiliate, successor or assign of Seller (collectively, the "Seller Group") has made any representation, warranty, inducement, promise, agreement, assurance or statement, oral or written, of any kind to Buyer upon which Buyer is relying, or in connection with which Buyer has made or will make any decisions concerning the Property or its vicinity, including, without limitation, its use, condition, value, compliance with Governmental Regulations (as hereinafter defined), existence or absence of Hazardous Substances, or the permissibility, feasibility or convertibility of all or any portion of the Property for any particular use or purpose, including, without limitation, its present or future prospects for sale, lease, development, occupancy or suitability as security for financing. As used herein, the term "Governmental Regulations" means any laws (including Environmental Laws, as hereinafter defined), ordinances, rules, requirements, resolutions, policy statements and regulations (including, without limitation, those relating to land use, subdivision, zoning, Hazardous Substances, occupational health and safety, handicapped access, water, earthquake hazard reduction and building and fire codes) of any governmental or quasi -governmental body or agency claiming jurisdiction over the Property. As used in this Agreement, the following definitions shall apply: "Environmental Laws" shall mean all federal, state and local laws, ordinances, rules and regulations now or hereafter in force, whether statutory or common law, as amended from time to time, and all federal and state court decisions, consent decrees and orders interpreting or enforcing any of the foregoing, in any way relating to or regulating human health or safety, or industrial hygiene or environmental conditions, or protection of the environment, or pollution or contamination of the air, soil, surface water or groundwater, and includes, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9601, et seq., the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et seq., and the Clean Water Act, 33 U.S.C. § 1251, et seq. "Hazardous Substances" shall mean any substance or material that is described as a toxic or hazardous substance, waste or material or a pollutant or contaminant, or words of similar import, in any of the Environmental Laws, and includes asbestos, petroleum (including crude oil or any fraction thereof, natural gas, natural gas liquids, liquefied natural gas or synthetic gas usable for fuel, or any mixture thereof), petroleum - based products and petroleum additives and derived substances, lead -based paint, mold, fungi or bacterial matter, polychlorinated biphenyls, urea formaldehyde, radon gas, radioactive matter, medical waste and chemicals that may cause cancer or reproductive toxicity.

Buyer's Initials
M

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9.3.3 No Implied Warranties. Excluding any representation or warranty or covenant set forth herein or in any of the Closing Documents, and subject to Seller's disclosure obligations under California law, Seller hereby specifically disclaims: (a) all warranties implied by law arising out of or with respect to the execution of this Agreement, any aspect or element of the Property or the performance of Seller's obligations hereunder, including, without limitation, all implied warranties of merchantability, habitability and/or fitness for a particular purpose; and (b) any warranty, guaranty or representation, oral or written, past, present or future, of, as to or concerning (i) the nature and condition of the Property or other items conveyed hereunder, including, without limitation, the water, soil and geology, the suitability thereof and of the Property or other items conveyed hereunder for any and all activities and uses that Buyer may elect to conduct thereon, the existence of any environmental hazards or conditions thereon (including but not limited to the presence of asbestos or other Hazardous Substances) or compliance with applicable Environmental Laws; (ii) the nature and extent of any right-of-way, lease, possession, lien, encumbrance, license, reservation, condition or otherwise; and (iii) the compliance of the Property or its operation with any Governmental Regulations.

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Buyer's Initials

9.3.4 Information Supplied by Seller. Buyer specifically acknowledges and agrees that, except as expressly contained in this Agreement or in any of the Closing Documents, Seller has made no representation or warranty of any nature concerning the accuracy or completeness of any documents delivered or made available for inspection by Seller to Buyer, including, without limitation, the materials delivered by Seller pursuant to Section 3.2, and that Buyer has undertaken (or will undertake) such inspections of the Property as Buyer deems necessary and appropriate and that Buyer is relying solely upon such investigations and not on any of the materials delivered by Seller pursuant to Section 3.2 or any other information provided to Buyer by or on behalf of Seller. As to the materials delivered by Seller to Buyer pursuant to Section 3.2, Buyer specifically acknowledges that they have been prepared by third parties with whom Buyer has no privity and Buyer acknowledges and agrees that no warranty or representation, express or implied, has been made, nor shall any be deemed to have been made, to Buyer with respect thereto, either by the Seller Group or by any third parties that prepared the same.

Buyer's Initials

9.3.5 Release. As of the Closing Date, and subject to and except for Seller's disclosure obligations under California law as a seller of real property, Buyer hereby fully and irrevocably releases Seller from any and all claims that Buyer may have or hereafter acquire prior to the Closing Date against Seller for any cost, loss, liability, damage, expense, demand, action or cause of action ("Claims") arising from or related to any matter of any nature relating to the Property, including, without limitation, the physical condition of the Property, any latent or patent construction defects, errors or omissions, compliance with law matters, Hazardous Substances and other environmental matters within, under or upon, or in the vicinity of the Property, including, without limitation, any Environmental Laws; provided, however, the foregoing release shall not apply to any of Seller's representations, warranties or covenants under 10

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD this Agreement. Subject to the preceding proviso and except for Seller's disclosure obligations under California law as a seller of real property, the foregoing release by Buyer shall include, without limitation, any Claims Buyer may have prior to the Closing Date pursuant to any statutory or common law right Buyer may have to receive disclosures from Seller, including, without limitation, any disclosures as to the Property's location within areas designated as subject to flooding, fire, seismic or earthquake risks by any federal, state or local entity, the presence of Hazardous Substances on or beneath the Property, the need to obtain flood insurance, the certification of water heater bracing and/or the advisability of obtaining title insurance or any other condition or circumstance affecting the Property, its financial viability, use or operation, or any portion thereof. This release includes Claims of which Buyer is presently unaware or that Buyer does not presently suspect to exist in its favor which, if known by Buyer, would materially affect Buyer's release of Seller. In connection with the general release set forth in this Section 9.3.5, Buyer specifically waives the provisions of Section 1542 of the California Civil Code, which provides as follows:
"A general release does not extend to claims which the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that if, known by him or her, must have materially affected his or her settlement with the debtor or released party."
Buyer's Initials

10. Billboard Signage. For a period of five (5) years from the Closing Date, provided the same does not adversely affect Buyer's development plans with respect to the adjacent parcel, including, but not limited to, the contemplated helipad and flight path and desired parking, Buyer, for such consideration and on terms mutually agreeable to Buyer and Seller, is willing to entertain in good faith a proposal from Seller to acquire an easement over, a ground lease of or such other agreed upon rights with respect to a portion of the Property for purposes of installing, constructing, operating and maintaining an electronic billboard sign (the "Billboard"). The exact location and size of the area upon which the Billboard will be located shall be determined and agreed upon by both Parties (the "Billboard Area"). Buyer and Seller anticipate that the Billboard will be a collaborative opportunity for the mutual benefit of both Parties. Accordingly, any costs and expenses, including, but not limited to, third party fees, recording fees and permit or license fees, incurred in connection with any required approvals or the preparation of a legal description of the Billboard Area; a drawing to scale, including a detailed description of the Billboard Area, on a property map; and an appropriate recordable agreement documenting the arrangement of record, shall be borne as agreed upon by Buyer and Seller, taking into consideration the respective rights, benefits and obligations of the Parties created with respect to the Billboard and the Billboard Area.

Any agreed upon fees and costs incurred by Buyer or Seller to facilitate the proposed arrangement shall be subject to reconciliation to the extent a Party incurs costs in excess of its agreed upon share. Any amount owing by a Party to the other Party shall be promptly paid upon presentation of supporting documentation. The provisions of this Section 10 shall survive Closing. 11

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11. Miscellaneous Provisions.

11.1 Authority of City Manager. The City Manager of Seller is authorized to give all consents and approvals and sign this Agreement and all documents contemplated hereunder on behalf of Seller provided they are in writing; may extend deadlines, including, but not limited to, the Closing Date, for up to sixty (60) days; and may enter into non -substantive amendments, including amendments extending deadlines, provided the amendments are express and in writing.

11.2 Notices. Notice may, unless otherwise provided herein, be given or served (a) by certified mail, return receipt requested; (b) by email, if the time of email delivery is confirmed by sender's receipt of an email report which confirms that the email was successfully transmitted in its entirety and provided the email was forwarded prior to 5:00 P.M.; or (c) by depositing the same into custody of a nationally recognized overnight delivery service for next business day delivery. Notice given in any manner shall be effective only if and when received by the party to be notified between the hours of 8:00 A.M. and 5:00 P.M. of any business day with delivery made after such hours to be deemed received the following business day. For the purposes of notice, the addresses of Seller and Buyer shall, until changed as hereinafter provided, be as set forth below. The parties hereto shall have the right from time to time to change their respective addresses, and each shall have the right to specify as its address any other address within the United States of America by at least five (5) days written notice to the other parry.

If to Buyer: NorthBay Healthcare Corporation
4500 Business Center Drive
Fairfield, CA 94534
Attn: Chris Matthews
Chri s. M atthews (ab,NorthB ay. org
If to Seller: City of Fairfield
1000 Webster St., 2nd Floor
Fairfield, California 94533
Attn: Jennifer Rice
jrice(afairfield.ca.gov

11.3 Construction. If the date for any performance under this Agreement falls on a weekend or holiday, the time shall be extended to the next business day. "Business day" means a day that both national banks and Title Company are open for business in Fairfield, California.

11.4 Waiver. Failure of either party at any time to require performance of any provision of this Agreement shall not limit such parry's right to enforce such provision, nor shall any waiver of any breach of any provision of this Agreement constitute a waiver of any succeeding breach of such provision or a waiver of such provision itself.

11.5 Amendment. This Agreement may not be modified or amended except by the written agreement of the parties. No modification or amendment or attempted waiver of any 12

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD provision of this Agreement shall be binding unless in writing and signed by the party to be bound.

This Agreement may not be modified or amended orally.

11.6 Attorneys' Fees. In the event a suit, action, arbitration or other proceeding of any nature whatsoever, including, without limitation, any proceeding under the U.S. Bankruptcy Code, is instituted, or the services of an attorney are retained, to interpret or enforce any provision of this Agreement or with respect to any dispute relating to this Agreement, the prevailing party shall be entitled to recover from the losing party its reasonable attorneys', paralegals', accountants' and other experts' fees and all other fees, costs and expenses actually incurred and reasonably necessary in connection therewith. In the event of suit, action, arbitration or other proceeding, the amount thereof shall be determined by the judge or arbitrator, shall include fees and expenses incurred on any appeal or review and shall be in addition to all other amounts provided by law.

11.7 Severability. If any term or provision of this Agreement or the application thereof to any person or circumstance shall to any extent be invalid or unenforceable, the remainder of this Agreement and the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby, and each term or provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

11.8 Brokers. Seller and Buyer each warrant and represent to each other that aside from Chris Matthews, who represents Buyer ("Buyer's Broker"), no broker or finder has been engaged by it in connection with the transaction contemplated by this Agreement. Seller agrees and acknowledges that it will be solely responsible for the payment of a brokerage fee to NorthBay Healthcare Foundation, a California nonprofit public benefit corporation, per the direction of Buyer's Broker, in the amount of Thirty -Six Thousand Five Hundred Dollars ($36,500.00). Seller and Buyer warrant and represent that no broker or finder has been engaged by it in connection with the transaction contemplated by this Agreement except for Buyer's Broker; however, in the event any other claims for brokers' or finders' fees or commissions are made in connection with the negotiation, execution or consummation of this Agreement based upon any statement, representation or agreement made by Buyer, then Buyer shall indemnify, hold harmless and defend Seller from and against such claims, and similarly, Seller shall indemnify, hold harmless and defend Buyer if such claims shall be based on any statement, representation or agreement made by Seller.

11.9 Integration. This Agreement contains the entire agreement and understanding of the parties with respect to the purchase and sale of the Property and supersedes all prior and contemporaneous agreements between them with respect to such purchase and sale.

11.10 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California.

11.11 Assignment. This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors, heirs, administrators and assigns; provided, however, Buyer may not assign its interest in this Agreement without the prior written consent of Seller, which consent may be withheld by Seller in Seller's sole discretion; provided, further, that 13

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD without being relieved of any liability under this Agreement, Buyer reserves the right to take title to the Property in the name of an entity that is controlled by Buyer.

11.12 Execution in Counterparts. This Agreement may be executed in two (2) or more counterparts, each of which will be deemed an original but all of which together will constitute one (1) and the same agreement. Telecopied or faxed signatures, signatures emailed in a "pdf' format or electronic signatures, including by an electronic signature platform such as DocuSign, may be used in place of original signatures on this Agreement with the same force and effect as original signatures. Seller and Buyer intend to be bound by the signatures on telecopied, faxed, electronic platform or pdf documents; are aware that the other party will rely on the telecopied, faxed, electronic platform or pdf signatures; and hereby waive any defenses to the enforcement of the terms of this Agreement based on the use of a telecopied, facsimile, electronic platform or pdf signature.
[Signatures on the following page.]
14

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of the day and year first above written.

SELLER: BUYER:

CITY OF FAIRFIELD, NORTHBAY HEALTHCARE
a municipal corporation CORPORATION, a California nonprofit public benefit corporation
By:

Print Name: David Gassaway Sig —by
Title: City Manager By:

OA3BJC8521fiCdAB..

Print Name: Joseph D'Angina
ATTEST Title: Executive Vice President, CFO
By:

City Clerk

Page 195 of 550 ends

Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD

EXHIBIT A

LEGAL DESCRIPTION OF PROPERTY
The land described herein is situated in the State of California, County of Solano, City of Fairfield, described as follows:

Parcel 2, as set forth in that certain Notice of Minor Lot Line Adjustment, recorded November 21, 2003, as Series No. 200300201757, Solano County Records, and described as follows:

Real property in the City of Fairfield, County of Solano, State of California, Parcels One, Two and Three as described in the Deed to JS & J Service, Inc., recorded May 20, 1999, under Serial Number 1999- 00043418 of Official Records, Solano County Records, more particularly described as follows:

BEGINNING at the Southwest corner of Parcel 3, as shown on that certain Parcel Map filed for record on March 14, 1986, in Book 29 of Parcel Maps, Pages 47 through 50, Solano County Records; Thence along the Southwesterly line of Parcel 3 of said map and along the Northeasterly line of Parcel One of said Deed South 73°54' 17" East 1352.47 feet, to the TRUE POINT OF BEGINNING; Thence South 55°38'07" West 653.33 feet; Thence along a tangent curve to the right, having a radius of 1050.00 feet, through a central angle of 38°48'03" for an arc length of 711.06 feet; Thence North 85°33'50" West, 153.12 feet to the Westerly line of said Parcel One, being the Easterly line of Suisun Valley Road;
Thence along said Westerly line and along the Southwesterly lines of Parcels One and Three of said Deed the following four courses;

1. Thence South 4° 41' 23" West 220.65 feet;

2. Thence South 16' 41' 34" East 56.04 feet;

3. Thence South 30' 58' 32" East 98.21 feet;

4. Thence South 39' 59' 34" East 116.79 feet to the Southeasterly line of Parcel Three of said Deed, being the Northwesterly line of Interstate Highway 80;
Thence along said Northwesterly line, the following two courses:

1. Thence North 56°16'22" East 742.30 feet;

2. Thence Northeasterly along a non -tangent curve to the right, having a radius of 20,074.00 feet, whose center bears South 37°41'35" East, through a central angle of 2°36'06", for an arc length of 911.51 feet, to the Northeast corner of Parcel 3 of said map; thence along said Northeasterly line of Parcel Two of said Deed, North 73°54' 17" West, 113.29 feet to the POINT OF BEGINNING.

APN: 0027-260-230

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Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD 0 C14
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Page 197 of 550 ends

Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD

EXHIBIT B

FORM OF GRANT DEED

RECORDING REQUESTED BY, AND WHEN
RECORDED MAIL TO:

NorthBay Healthcare Corporation
4500 Business Center Drive
Fairfield, CA 94534
Attn: Chris Matthews
APN: 0027-260-230

GRANT DEED

SPACE ABOVE FOR RECORDER'S USE ONLY
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, the CITY OF FAIRFIELD, a municipal corporation ("Grantor"), hereby GRANTS to the NORTHBAY HEALTHCARE CORPORATION, a California nonprofit public benefit corporation ("Grantee"), that certain real property located in the City of Fairfield, County of Solano, State of California, more particularly described on Exhibit "A" attached hereto and incorporated herein by this reference, together with all rights, privileges, appurtenances, hereditaments, tenements, easements, reversions and remainders pertaining thereto or used in connection therewith.

IN WITNESS WHEREOF, the undersigned has executed this Grant Deed as of the date set forth below.

Dated: 92026 GRANTOR:

CITY OF FAIRFIELD, a municipal corporation
By:

Print Name:

Title: City Manager

Page 198 of 550 ends

Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of California
County of Solano
On , before me,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

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

WITNESS my hand and official seal.

Signature
(Seal)

Page 199 of 550 ends

Docusign Envelope ID: 60E001CC-566D-8673-80FB-7169DFE6B1AD Exhibit A To Grant Deed
Legal Description of the Property
The land described herein is situated in the State of California, County of Solano, City of Fairfield, described as follows:

Parcel 2, as set forth in that certain Notice of Minor Lot Line Adjustment, recorded November 21, 2003, as Series No. 200300201757, Solano County Records, and described as follows:

1. Thence South 4° 41' 23" West 220.65 feet;

2. Thence South 16' 41' 34" East 56.04 feet;

3. Thence South 30' 58' 32" East 98.21 feet;

1. Thence North 56°16'22" East 742.30 feet;

APN: 0027-260-230

Page 200 of 550 ends

Page 201 of 550 ends

Agenda Item No: KA

AGENDA REPORT
DATE: July 7, 2026
TO: Mayor and Council
FROM: David Gassaway, City Manager
SUBJECT: CM Minute Action Approving the Mayor's Appointment Minute Action Approving Mayor's Appointment to the Planning Commission and the Youth Commission
Funding Source: N/A
Contact: Karen Rees, (707) 428-7767

RECOMMENDED ACTION
Approve appointments. Perform oaths of office.

STATEMENT OF ISSUE
The City Council is being asked to approve the appointment as follows:

Planning Commission
Term July 1, 2026, to June 30, 2030
• Hannah Cordero Chen
• Shashi Paul (re -appointment)
• Aidan Ali -Sullivan (re -appointment)
Youth Commission
Term January 1, 2026, to December 31, 2027
• Fateh Takhar

DISCUSSION
Councilmembers Doriss Panduro and Scott Tonnesen interviewed 12 applicants on June 10 and June 11, 2026. The applicants listed above are recommended for appointment, and the

Page 202 of 550 ends

recommendation was submitted to Mayor Rick Vaccaro for consideration. Mayor Vaccaro agreed with the recommendations provided.

FINANCIAL IMPACT
N/A

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A

ALTERNATIVE ACTION
The council may choose not to approve the mayor's appointments, thereby leaving vacancies.

COORDINATED WITH
N/A

STAFF CONTACT
Esther Beavers, Deputy City Clerk
(707) 428-7402
[email protected]

ATTACHMENTS
N/A

Page 203 of 550 ends

Agenda Item No: K.2
I//rrr

AGENDA REPORT
DATE: July 7, 2026
TO: Mayor and Council
FROM: David Gassaway, City Manager
SUBJECT: Resolution 2026-156 PR Golf Volunteer Program
Authorize Development of a Volunteer Program for City Golf Courses and Adopting Volunteer Service Benefit Policy
Funding Source: N/A
Contact: Kristina Kaunzinger, (707) 428-7470

RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
Touchstone Golf Foundation is dissolving and volunteer program at the golf courses will terminate. Staff seek approval to develop and implement a new city volunteer program specific for volunteer services at Rancho Solano and Paradise Valley golf courses.

Background:

In 2022, City Council directed an Request for Qualifications (RFQ)/Request for Proposal (RFP) process for management of the golf courses. The goal was a management service agreement with a single operator to improve service levels, effectiveness of overall management, and to maximize revenue generation. Council also affirmed expectations that golf operations be self- sufficient as an enterprise fund.

The RFQ/P was released in 2023, and Touchstone Golf was selected as the operator, taking over management of the courses in January 2024. Since January 2024, staff have worked with Touchstone to identify operating inefficiencies and maximize revenue generation.

Touchstone Golf, LLC partnered with Touchstone Golf Foundation, a third -party non-profit organization, which provided volunteers who, in connection with their efforts to improve communities through service and by raising funds for charitable efforts through golf related

Page 204 of 550 ends

activities, helped augment the player experience at Rancho Solano and Paradise Valley golf courses.

In March 2025, the city was notified that KemperSports (Kemper) had acquired Touchstone Golf.

The Touchstone Golf Foundation is a separate independent non-profit entity and was not part of the Touchstone Golf LLC acquisition by Kemper. Following the Kemper acquisition, the Foundation is being dissolved.

Section 6.12D6 of the management agreement (Attachment 10) between the City and Touchstone/Kemper requires the operator to identify and report on all discounts, fee waivers, donations and complimentary golf. This section was explicitly added to the contract due to concerns raised about previous operators past practices and lack of policy and structure of complimentary or discounts provided.
nigriltSlnN
In late 2025, the City was notified that the Touchstone Golf Foundation would be dissolved. As such, Kemper can no longer support the volunteer program as currently structured. Kemper, who purchased Touchstone Golf in 2025, proposed either 1) the volunteer program come under the City or, 2) they would hire employees to serve in those roles.

In discussions with the Golf Advisory Board (GAB) on the approach to maintaining volunteer services, several current volunteer members requested the City consider continuing the program under the City's oversight. The GAB concurred with the request and directed staff and Kemper to provide information needed to make a recommendation to the council.

On May 7, 2026, the GAB received the following information:

1. Kemper provided analysis of the 2025 volunteer services, including the number of volunteer rounds played and days of the week complimentary golf was provided to volunteers. (Attachment 3)

2. Staff provided a memorandum from legal counsel on relevant labor laws concerning compliance with de minimis benefit provisions for volunteers under the Fair Labor Standards Act. (Attachment 4)

3. An outline of key components for a formal city volunteer program. (Attachment 5)

4. Board members were asked to provide a recommendation to the City as to reasonable benefits for golf volunteer services. A key consideration was the amount of free golf and discounts on food and merchandise provided to volunteers based on the number of volunteer hours worked. At their May 7, 2026, meeting, the GAB was unable to reach consensus on a recommendation and requested additional information from Kemper as to the benefits received by employees. The Board held a special meeting on May 28, 2026, to review the employee benefits and recommend benefits for volunteer services.

5. Kemper provided the Board with their Employee Golf Policy for reference at the May 28, 2026, Special Board meeting (Attachment 6). Staff also presented recommended volunteer service benefits for a city -managed volunteer program (Attachment 7).

Page 205 of 550 ends

6. After deliberation, the Board came to consensus for an alternative to the City's proposed benefits (Attachment 8).

Action Requested:

Two key areas must be taken into account with any recommendation presented.

1. Consider legal definition of what constitutes/defines a volunteer and benefits received as outlined in Attachment 4

2. Consider financial impact and operation efficiency
Given the factors above, the best option for creating operational efficiency, minimizing city risk and liability, and greatest opportunity for revenue enhancement is to have tasks previously provided by volunteers integrated into Kemper's responsibilities.

However, in recognition of GAB's recommendation and support for developing a new city - managed volunteer program, and hearing from current volunteers of their desire to continue providing volunteers services, staff has prepared a draft proposal for Council's review.

Based on Council goals and expectations of golf enterprise self-sufficiency, and outside counsel legal considerations, staff recommends: 1) a limitation on tasks assigned; 2) a reduction in complimentary golf rounds provided; and 3) a modification to other benefits for volunteers. By providing fewer free rounds of golf for volunteers, additional tee times are available for paying customers, which should increase revenue for the courses.

This includes a restriction on when complimentary golf can be redeemed and recommends City Council to:

1. Direct staff to develop and implement a golf volunteer program; and

2. Adopt a policy clearly specifying the benefits received for volunteer services rendered as outlined in Attachment 9.

FINANCIAL IMPACT
Any direct costs associated with the City's golf volunteer services will be charged to the golf fund.

Kemper anticipates that revenue generation will increase with opening tee -times to paying customers through limiting the days/times of when complimentary golf is available for employees and volunteers.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
At their February 12, 2026, May 7, 2026, and May 28, 2026, meetings, the Golf Advisory Board reviewed and discussed options relating to the dissolution of the Touchstone Golf Foundation and its impact with continuing the Golf Volunteer Program. At the May 28, 2026, Special Meeting, with an affirmative vote of 6 with 1 conflict abstention, the Board provided their recommendation for golf benefits (Attachment 8).

Page 206 of 550 ends

ALTERNATIVE ACTION

1. Deny developing a City volunteer program and have Kemper staff assume all operational duties, tasks, and responsibilities formerly provided by volunteers.

2. Approve Golf Advisory Board recommendation.

3. Any alternative action as directed by council.

COORDINATED WITH
City Attorney's Office, City Manager's Office, Finance Department, and Human Resources Department

STAFF CONTACT
Kristina Kaunzinger, Parks & Recreation Director
(707) 428-7470
[email protected]

ATTACHMENTS
Attachment 2: Proposed Resolution
Attachment 3: Kamper Analysis
Attachment 4: Legal Memorandum
Attachment 5: Outline Volunteer Program
Attachment 6: Employee Play Policy
Attachment 7: City Proposed Options
Attachment 8: GAB Recommendation
Attachment 9: City Proposed Volunteer Program Benefits
Attachment 10: Executed Agreement Touchstone 2023
Attachment 11: City of Fairfield Golf Course Volunteer Program

Page 207 of 550 ends

CITY OF FAIRFIELD
RESOLUTION NO. 2026-156

APPROVING DEVELOPING A VOLUNTEER PROGRAM FOR CITY GOLF COURSES AND ADOPTING

VOLUNTEER SERVICE BENEFIT POLICY
WHEREAS, in 2024 the City and Touchstone Golf, LLC entered into a management agreement for operation and maintenance of the two city -owned golf courses; and WHEREAS,the City authorized use of volunteers through the not -for -profit Touchstone Golf Foundation, an affiliate of Touchstone Golf; and
WHEREAS, in early 2025, Touchstone Golf, LLC was acquired by KemperSports; and WHEREAS, in late 2025, notification was received that the Touchstone Foundation was dissolving, thereby no longer supporting volunteer services; and
WHEREAS, in 2026, Golf Advisory Board recommended the City of Fairfield develop a volunteer program for service at both golf courses to be operated as a City volunteer program; and WHEREAS,in compliance with City Council goals and expectations of golf enterprise self- sufficiency, and guidance on Fair Labor Standards Act requirements by outside legal counsel, staff recommend limitation on tasks assigned and benefits received for volunteers serving at the golf courses.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. The city manager, or designee, is hereby directed to develop a formalized city - managed and administered Volunteer Program for volunteer services at city owned golf courses.

Section 2. Approves the benefit policy as attached and as presented at the July 7, 2026, City Council meeting.

Page 208 of 550 ends

RES. NO. 2026-156

Page 2 ends

PASSED AND ADOPTED this 7t" day of July 2026, by the following vote:

AYES: MEMBERS: VACCARO/BERTANI/CARR/PANDURO/SANDHU/TONNESEN/WILHAMS li•L�l�.�uIaA : 10.11
1/ _ •
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CITY CLERK

Page 209 of 550 ends

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SloanSaka
Sloan Sakai Yeung 6 Wong LLP
Memorandum

PRIVILEGED AND CONFIDENTIAL ATTORNEY -CLIENT COMMUNICATION To: Kristina Kaunzinger, Director of Parks & Recreation City of Fairfield
From: Genevieve Ng, Attorney
Date: April 29, 2026
Re: Volunteer Marshals at City Golf Courses
Introduction & Background
The City of Fairfield owns two municipal golf courses — Paradise Valley and Rancho Solano.

Members of the public are able to play these courses for a fee. Additionally, these courses have dining and banquet facilities for golf related events, general public, and large events including weddings. While the City of Fairfield owns these properties and facilities, the City contracts with a third -party vendor Kemper/Touchstone, who manages all operations including employing staff. There are no City employees who work at either of the courses.

Up until recently, Kemper/Touchstone, through a non-profit, allowed people to volunteer to marshal at the clubs in exchange for free rounds of golf. Their volunteer marshals worked alongside Kemper/Touchstone employees providing similar and other services at these courses. There was no articulated structure or schedule, but, generally speaking, volunteers would marshal for a set number of hours in return for a round of golf. There are a handful of volunteers who annually received numerous rounds of golf, discounts on food and beverage estimated at a cost of a few thousand dollars for each. Volunteers also receive discounts free and discounted merchandise from the proshop. In total, these volunteer benefits cost the City more than $240,000 in a fiscal year.

SLOAN SAKAI YEUNG & WONG LLP EMERYVILLE I SACRAMENTO
2200 Powell Street, Suite 450 Emeryville, CA 94608 O: 510.995.5800 F: 415.678.3838 www.sloansakai.com

Page 212 of 550 ends

SloanSakai
Sloan Sakai Yeung b Wong LLP
Memo to: Kristina Kaunzinger, City of Fairfield
April29, 2026

Page 2 ends

Recently, Kemper/Touchstone notified the City that due to the non-profit affiliate dissolution, it no longer wished to engage with volunteers. However, Kemper/Touchstone has indicated a willingness to manage volunteers so long as these volunteers were engaged by the City.

Discussion
In general, volunteer status is defined by a lack of compensation for services provided to the organization. However, state and federal law recognize that payment of expenses and nominal fees to volunteers may be appropriate and should not alter their employment status; the appropriateness of such payments must be evaluated on a case -by -case basis.

The term "stipend" is not defined under the Fair Labor Standards Act (the "FLSA"), nor does the FLSA include any provisions that specifically discuss the payment of stipends by an employer. Stipends are generally understood to be periodic payments that are not tied to work performed by the recipient, in contrast to salary payments for services rendered.

The context in which stipends are most often addressed under the FLSA is when payment of a stipend converts an unpaid volunteer into a paid employee. The FLSA and its implementing regulations define a volunteer as "an individual who performs hours of service ... for civic, charitable, or humanitarian reasons, without promise, expectation or receipt of compensation for services rendered ..." 29 C.F.R. §553.101.

The California Division of Labor Standards Enforcement (the "DI -SE"), which enforces the California Labor Code, applies a very narrow definition of "volunteer." The DLSE's position is that the parties' intent is key to determining whether an individual is a volunteer.

Specifically, if the individual "intends to volunteer his or her services for public service, religious, or humanitarian objectives, not as an employee and without contemplation of pay," that individual will be treated as a volunteer and not subject to the various wage and hour and other employment laws that are applicable to employees. DLSE Op. Letter 1988.10.27 (emphasis in original).

The FLSA allows non-profit agencies and public agencies to payto volunteers "expenses, reasonable benefits, a nominal fee, or any combination thereof" without causing volunteers to become employees. 29 C.F.R. §553.106(a). Nominal fees are not defined

PRIVILEGED AND CONFIDENTIAL ATTORNEY -CLIENT COMMUNICATION

Page 213 of 550 ends

SloanSakai
Sloan Sakai Yeung 6 Wong LLP
Memo to: Kristina Kaunzinger, City of Fairfield
April29, 2026

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under the FLSA but are presumed if the fee does not exceed twenty percent (20%) of what an employer would pay to hire a full-time employee to do the same work. See, e.g. U.S.

DEP'T OF LAB., Wage and Hour Opinion Letters FLSA 2006-28 and FLSA 2005-51. A fee is not nominal if it is tied to productivity or is a substitute for compensation. 29 C.F.R. §553.106(e).

Analysis & Recommendation
Certain risks exist if the City were to engage volunteers to marshal at the golf courses.

Some risk exists if the City were to move the volunteers from Touchstone/Kemper to the City especially if the City were to continue to have Touchstone/Kemper manage them and have City volunteers work alongside Touchstone/Kemper employees performing those same duties. If the City were to engage volunteer marshals, the City must ensure that it does not directly employ individuals who perform similar duties to the volunteer marshals.

If the City were to engage volunteers to provide marshaling services, the City should create a formal volunteer program which includes:
• Defining the volunteer role including an analysis of whether the duties performed by volunteers are also being performed by paid employees;
• Developing a volunteer waiver form;
• Applying volunteer only and specific City policies such as anti -harassment, discrimination and retaliation; and
• Creating a schedule for de minimis benefits.

As discussed above, any benefit provided to the volunteers should be de minimis. It is also important to note that Cityvolunteers that marshal at these courses may be working alongside paid Kemper/Touchstone employees, which may create risk, which is why it is important to ensure that individuals understand that they are City volunteers set up through a Cityvolunteer program.

PRIVILEGED AND CONFIDENTIAL ATTORNEY -CLIENT COMMUNICATION

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GENERAL SUMMARY OUTLINE —CITY VOLUNTEER PROGRAM
City is open to consider a volunteer program:

Reduction from current and past practices (shifts/benefits) Modification of tasks from past practices (responsibilities adjusted/limited) City Responsibilities
Create volunteer application form and waiver form
Create volunteer "handbook"
Ensure volunteers have completed waiver form and training prior to scheduling Manage DOJ/Background clearance process (fees charged to Golf Fund) Provide additional liability coverage for program (cost charged to Golf Fund) Direct city staff support costs will be charged to Golf Fund Ensure all volunteers are current with mandated training Kemper Responsibilities
Assist with creating volunteer "handbook"
Manage and prepare volunteer schedule based upon operation need (fluctuates) Provide "training" and general oversight of individual
Report any performance issues to City
Ensure that Kemper staff members understand the process, protocol and reporting procedures for volunteer benefits
On a monthly basis, provide City with report of volunteer activities and benefits received (by individual volunteer)
City/Kemper Joint Responsibility
Recruit/advertise for volunteers (as needed, on -going, etc.) Interview volunteer candidates
Address anyvolunteer performance issues
Host joint meeting(s) with volunteers (orientation, annual/biannual ck in mtgs) City directs Kemper to identify operation need and prepare schedule - will vary (i.e. extra help during Tournaments/Special events)

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EMPLOYEE GOLFING POLICY
As of July 1, 2026
As a City of Fairfield owned facility, we have a fiscal responsibility to maximize revenues and maintain the golf course in excellent conditions for our guests at all times. Our priority is to our Guests and employee play as a benefit should never supersede that priority.

Rancho Solano and Paradise Valley Golf Courses extend to its employees the privilege of playing golf at the golf courses under certain conditions. All staff play must not displace or interfere with any paying golf guests at any time.

OVERVIEW
All Staff play & practice at Rancho Solano and Paradise Valley Golf Courses will adhere to the following policy:

The General Manager and Head Golf Professionals have final approval of all staff golf play privileges. The following rules are mandatory and are the minimum established requirements:

1. No employee tee -time reservations maybe made in advance. The ability to play golf is based on available tee -times on the day of play.
a. Employees will check in with the Pro Shop Attendant to get on the waitlist for play.
b. Employees cannot be apart of a paying guest's reservation and receive complimentary play. The employee will be charged the appropriate fee at that time.
i. Example 1: Jane Smith books a tee time for four golfers which includes employee Joe, Joe would have to pay the appropriate green fee to play with Jane's group.
ii. Example 2: Jane Smith books a tee time for two golfers. On the day of play, the other spots in the tee time are not reserved. Employee Joe is on the waitlist for play and can join Jane's tee time as a third golfer for complementary play.

2. Golf carts will be available at a $5 fee per employee. It is expected that an employee will share a cart with another golfer.

3. Employees playing in an Outing, Tournament, Group Play, or any organized play with a contracted price with the golf course, will pay the contracted fee.

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4. All employees must first seek approval from their respective Department Heads before requesting tee -times from the golf management staff.

5. The golf course must be deemed open for play. (No playing prior to the first tee time or during closed conditions, unless approved by the Head Golf Professional or the General Manager.)

6. All staff must register and obtain a complimentary golf receipt from the golf shop to present to the starter before entering the golf course.

7. No staff member is allowed to consume alcohol on the Golf premises, whether working or not per KemperSports Policy.

8. Any significant damage caused to the golf course or negligent use of equipment by the employee or their guests is the responsibility of the employee.

GENERAL RULES

1. Determining whether the staff play will interfere with the play of our fee paying guests is at the sole discretion of the golf operations "Manager on Duty", Head Golf Professional, or General Manager.

2. Interfering with play includes: the use of a golf cart necessary for the operations, while guests are waiting for carts, over -crowding conditions on the course, use of the practice facility during peak times or expecting potentially salable tee times.

3. General staff play will be limited to only Monday —Thursday tee -times and Friday, Saturday and Sunday after 2pm.

4. Each staffer must leave the golf course in the appropriate condition how they find it and make improvements, if possible. (Pick up trash and tees, fix extra ball marks, repair divots, repair any minor damages, etc).

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City Volunteer Program
Program Schedule: 3 shifts per day (1 person per shift); typical shift 5 hours —this is subject to change based upon season and operational impact with large outing/tournaments as well as inclement weather.

Role: Primary -serve as Ambassador for City's golf courses Customer service — greet players, promote golf special events and tournaments Etiquette — assist/monitor pace of play, inform/remind players of responsibility to fill divots, raking bunkers, ball mark repair
Course Beautification — assist with trash pick-up on courses and surrounding property, and as needed, fill divots, repair ball marks Qualification: Selection through a formal application/interview process; pass background check, keep current on all mandated City training; maintain good standing Volunteer Appreciation: Annual food/golf event for all volunteers (course site rotates each year)
Benefit Eligibility: Volunteer member is required to work a minimum of 3 shifts per month.

Benefit is solely applicable to individual volunteer (no guest/family/friends).

Benefit:

One (1) complimentary round of golf for every 3 shifts worked 50% discount on cart fee
25% discount on food purchased during their shift
Benefit Redemption: Monday through Thursday anytime after 1 pm* *No volunteer tee -time reservations maybe made in advance. The ability to play golf is based on available tee -times on the day of play. Standby only - daily wait list, first come - first serve as tee times are available. Volunteers playing in an Outing, Tournament, Group Play, or any organized play with a contracted price with the golf course, will pay the contracted fee and may not utilize their complimentary round.

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General Coordination:

Volunteers managed by City Staff; onsite instruction and general supervision provided by Golf staff.

City staff prepares a monthly schedule and assigns volunteers based upon operational needs and volunteer availability.

Schedule is forwarded to respective course Pro Shop.

Volunteer reports to course a minimum of 10 minutes prior to start of shift to check -in and receive general information and or special instruction.

Golf staff maintain record of shifts served, tracks complimentary golf.

Golf staff send monthly report to City.

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Summary of Golf Volunteer Proposal

BENEFITS
KemperSports — EMPLOYEE
Golf Advisory Board
City of Fairfield
Benefit
Recommend Volunteer
Recommended Volunteer
Benefit
Benefit
Complimentary Golf
Active employee
One (1) free round of golf for
One (1) free round of golf for
Eligibility
every one shift worked (5
every 3 shifts worked (15
hours)
hours)
Cart Fee Discount
$5 flat rate
$5 flat rate
50% discount on rate
Discount Food
50% discount while on shift
50% discount while on shift
25% discount while on shift
Benefit Redemption
Stand by/daily wait list, first-
Stand by/daily wait list, first-
Stand by/daily wait list, first -
come, first serve
come, first -served
come, first -served
Mon-Thurs (no time
Mon-Thurs (no time
Mon-Thurs after 1 pm
restriction)
restriction)
Fri, Sat, Sun after 2pm
Fri, Sat, Sun after 2pm
Not allowed to join a paying
Allowed to play with a paying
Not allowed to join a paying
golfer who has an advanced
golfer who has an advanced
golfer who has an advanced
reservation
reservation
reservation

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City of Fairfield Golf Course Volunteer Program
Program Schedule: 3 shifts per day (1 person per shift); typical shift 5 hours —this is subject to change based upon season and operational impact with large outing/tournaments as well as inclement weather.

Benefit is solely applicable to individual volunteer (no guest/family/friends).

Benefit: The benefits below are available to volunteers.

The ability to play golf is based on available tee -times on the day of play.

Standby only - daily wait list, first come -first serve as tee times are available.

Volunteers playing in an Outing, Tournament, Group Play, or any organized play with a contracted price with the golf course, will pay the contracted fee and may not utilize their complimentary round.

No guarantee made to accommodate complimentary golf. Complimentary rounds earned, reset every 30 days.

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General Coordination between City and Kemper:

Volunteers managed by City Staff. Onsite instruction and general supervision provided by Golf staff.

City staff prepares a monthly schedule and assigns volunteers based upon Kemper's operational needs and volunteer availability.

Schedule is forwarded to respective course's golf staff in Pro Shop.

Volunteer reports to course a minimum of 10 minutes prior to start of shift to check -in and receive general information and any special instruction.

Golf staff maintain record of shifts served, tracks complimentary golf and provides monthly report to City.

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CITY OF FAIRFIELD
RESOLUTION NO. 2023-257

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF FAIRFIELD APPROVING A MANAGEMENT

AGREEMENT WITH TOUCHSTONE GOLF, LLC FOR OPERATION AND MAINTENANCE OF THE

RANCHO SOLANO AND PARADISE VALLEY GOLF COURSES
WHEREAS, on June 21, 2022, the City Council provided direction to staff to solicit a Request for Qualifications (RFQ)/Request for Proposals (RFP) with a preference for a single operator to manage all operational aspects of the City's golf courses (golf, food/beverage, banquet) and allow for submittal for golf management only and restaurant/banquet management only; and WHEREAS, an RFQ/RFP was released on March 8, 2023, with responses from four companies (CourseCo., KemperSports, Touchstone Golf, and Troon) to serve as the single operator to manage the City's two golf courses; and
WHEREAS, Touchstone Golf ranked highest throughout a comprehensive evaluation process by a formal selection committee; and
WHEREAS, on August 15, 2023, the City Council authorized the City Manager or designee to negotiate an agreement with Touchstone Golf to manage the City's golf courses.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. The City Council hereby approves the. Management Agreement for Operation and Maintenance of Golf Courses and Facilities between the City of Fairfield and Touchstone Golf, LLC (Agreement), in substantially the form attached hereto as Attachments 2 and 3, with such changes as deemed necessary by the city manager.

Section 2. The city manager is hereby authorized and directed to execute the Agreement on behalf of the City of Fairfield.

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RES. NO. 2023-257

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PASSED AND ADOPTED this 17th day of October, 2023, by the following vote:

AYES: MEMBERS: MOY/ BERTANI / CARR /PANDURO % TONNESEN/ VACCARO / WILLIAMS NOES: MEMBERS:

NONE
ABSENT: MEMBERS: NONE
ABSTAIN: MEMBERS: NONE
MAYOR
ATTEST:

ITY CLERK

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Agenda Item No: 7.

Igift
iimiah
� AGENDA REPORT
DATE: October 17, 2023
TO: Mayor and City Council
FROM: David Gassaway, City Manager-='=
SUBJECT: Resolution 2023-257 of the City Council of the City of Fairfield Approving a Management Agreement with Touchstone Golf, LLC for Operation and Maintenance of the Rancho Solano and Paradise Valley Golf Courses

RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
Approve management contract agreement with Touchstone Golf, LLC, (Touchstone) to provide comprehensive oversight and management of the City's golf courses, Paradise Valley and Rancho Solano, effective January 1, 2024.

DISCUSSION
Since 2003 and through a series of contract extension renewals, KemperSports, Inc. (Kemper) has been the City's contract service provider for overall management, operations, and maintenance of the City -owned golf courses.

Through a lease agreement, Sports Restaurants Inc. (SRI), formerly known as Sports Restaurant of Fairfield (SRF) and Sports Restaurant of Rancho Solano (SRR) concurrently, has operated the restaurants, bars, and banquet facilities of the City golf courses. They have been the exclusive food, beverage, and banquet facilities operators of Paradise Valley since 1993 and Rancho Solano since 1998, under their proprietary business name "Legends and Heroes Sports Bar and Grill."
On June 21, 2022, City Council provided direction to staff to solicit a Request for Qualifications (RFQ)/Request for Proposals (RFP) with preference for a single operator to manage all operational aspects of the City's golf courses (golf, food/beverage, banquet) and allow for submittal for golf management only and restaurant/banquet management only.

Council also directed staff to proceed with extending the current contracts for an additional one-year term.

On December 6, 2022, and through Resolutions 2022-330 and 2022-331, the council formally approved one-year contract extensions for Kemper and SRI through December 31, 2023.

An RFQ/RFP was released on March 8, 2023, and the City received four responses — CourseCo, Kemper, Touchstone, and Troon. All four companies responded as single operators to manage all aspects of the golf courses. All four companies were deemed qualified and invited to a first round of review and interviews.

On August 15, 2023, staff presented a review of the results of the comprehensive evaluation process and the recommendation of the selection committee to authorize the city manager to begin negotiations with Touchstone.

Staff is seeking adoption of this resolution approving the Management Agreement for Operation and Maintenance of Golf Courses and Facilities with Touchstone (Agreement) to provide management services for Rancho Solano and Paradise Valley for golf, food/beverage, and banquet operations. The Agreement will have an initial term of seven years, taking effect on January 1, 2024, and terminating on December 31, 2030. Upon council approval, the City may negotiate an additional five-year term.

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FINANCIAL IMPACT
The Agreement provides for a base annual management fee of $185,000 with an annual Consumer Price Index (CPI) adjustment annually on July 1 starting July 1, 2025, with an incentive fee not to exceed 25% of the management fee.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
At the July 17, 2023, Golf Advisory Board (GAB) meeting, the board unanimously affirmed staffs recommendation to seek council authorization for the city manager to negotiate a management agreement with Touchstone.

ALTERNATIVE ACTION
Staff will proceed with any alternative action as directed by council.

STAFF CONTACT
Kristina Kaunzinger, Director of Parks & Recreation
(707) 428-7470
[email protected]

COORDINATED WITH
City Attorney's Office, City Manager's Office
ATTACHMENTS:

Attachment 1: Proposed Resolution
Attachment 2: Proposed Agreement
Attachment 3: Proposed Non Disclosure
REVIEWERS:

Reviewer Action Date
Beavers, Esther Approved 1012/2023-4:31 PM

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CITY OF FAIRFIELD

MANAGEMENT AGREEMENT FOR THE

OPERATION AND MAINTENANCE OF

GOLF COURSES AND FACILITIES
This Management Agreement (the "AGREEMENT") is entered into as of January 1, 2024, by and between the CITY OF FAIRFIELD, a municipal corporation ("CITY") and Touchstone Golf, LLC, a Delaware limited liability company ("OPERATOR").

RECITALS

1. CITY owns certain properties commonly referred to as the Paradise Valley Golf Course and the Rancho Solano Golf Course (together, the "Golf Courses").

2. CITY desires to contract with OPERATOR to provide for the overall management and operations of the Golf Courses, Food and Beverage and Banquet services, improvements to existing facilities, collection of fees and other related golf services to ensure the highest quality of golf programs, food service, and special event opportunities for the public.

3. OPERATOR represents that it is fully qualified to perform such services by virtue of its experience and the training, education, and expertise of its principals and employees.

4. The CITY selected OPERATOR to manage the Golf Courses at a meeting of the Fairfield City Council on August 15, 2023, and approved the Agreement at a meeting of the Fairfield City Council on October 17, 2023, with the effective date of January 1, 2024.

5. CITY and OPERATOR agree that the primary objectives for OPERATOR's performance under this Agreement are to (1) maximize revenue generation to support deferred maintenance, capital improvement and modernization of facilities, (2) promote the public use of the Golf Courses and related amenities, (3) market Food and Beverage and Banquet service, (4) ensure superior customer service and increase customer satisfaction, and (5) prioritize community engagement to satisfactorily address items 1 through 4.

NOW, THEREFORE, in consideration for the mutual promises hereinafter set forth the parties hereto agree as follows:

1.0 DEFINITIONS.

The following terms shall be defined as follows for the purposes of this Agreement:
l 1245\0001\713339.2

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1.1 CPI. "CPI" means the inflation figure used by the City, which is the average of the percent changes in the Consumer Price Index for CWURS49BSAO (SF -Oak -Hayward), as reported by the Bureau of Labor Statistics or successor agency.

1.2Clubhouses. The term "Clubhouses" shall mean the clubhouse buildings which are parts of the Golf Courses.

1.3 Director. "Director" shall mean the Director of Parks and Recreation of the City of Fairfield or an authorized representative thereof.

1.4 Fiscal Year.

A. "Fiscal Year" shall mean each period of twelve (12) full calendar months commencing on July 1 and ending on June 30, except as noted in Section 1.413. below.

B. The "First Fiscal Year" shall consist of the period from January 1, 2024, through June 30, 2024.

1.5Golf Courses. "Golf Courses" shall mean the Paradise Valley Golf Course and the Rancho Solano Golf Course including but not limited to the land, buildings, structures, equipment, irrigation and controls, tools, vehicles, cart paths, fencing, and all appurtenances thereto. The term "Golf Course" shall refer to either of the Golf Courses, or where the context requires, each may be referred to separately as "Paradise Valley" or "Rancho Solano."

1.6Golf Course Manual. "Golf Course Manual" shall mean the manual for the operation and maintenance of the Premises, including but not limited to, policies, procedures, operating protocol, maintenance standards, customer service handbook, code of conduct, etc. It may be revised during the term of this Agreement in the sole and absolute discretion of the Director.

1.7Gross Revenues. "Gross Revenues" shall mean any and all revenues attributable to the golf operation of the Golf Courses, including, but not limited to greens fees, cart rental fees, merchandise sales, driving range fees, food and beverage sales, banquets, special events, and admissions tax receipts.

1.8 Maintenance Standards. "Maintenance Standards" shall mean the standards for maintenance of the Golf Courses, Premises, and general groundskeeping. They may be revised during the term of this Agreement in the sole and absolute discretion of the Director.

1.9 PGA. "PGA" shall mean the Professional Golfers' Association of America.
11245\0001\713339.2 -2-

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1.10 Premises. "Premises" shall mean the Golf Courses, Clubhouses, restaurants, banquet venues, maintenance yards, grounds, and all other facilities on property.

2.0 APPOINTMENT OF OPERATOR

2.1 Operator's Role. CITY hereby retains OPERATOR as an independent contractor to manage and operate the Premises, and OPERATOR hereby agrees to manage and operate the Premises as an independent contractor, on the terms and conditions stated in this Agreement. The parties agree that this Agreement is a contract for services only and under no circumstances shall it be deemed to be a lease or conveyance of an interest in the Premises or any other real property.

2.2Improvements. OPERATOR shall make no improvements, additions, alterations or changes ("Improvements") to the Premises unless OPERATOR: (i) obtains the prior written approval of the Director, which approval may be granted or withheld in his or her sole and absolute discretion; (ii) complies with such terms and conditions as may be imposed by the Director; (iii) secures all applicable licenses, permits and other governmental approvals necessary to complete the construction of the Improvements; and (iv) causes all Improvements to be designed and constructed so as to be consistent with the currently -existing Golf Courses, unless otherwise specifically approved by the Director in writing.

2.30wnership of Improvements. Ownership of all structures, buildings or improvements, merchandise, golf carts, and Golf Course maintenance equipment, vehicles, and supplies constructed or acquired by the CITY or by the OPERATOR on behalf of the CITY and all alterations, additions or betterments thereto, shall remain with the CITY.

2.4Ownership of Names, Logos, Programs. Events. Ownership of all rebranding name(s), themes, logos, materials and collateral, special events, and programs developed or acquired during the Term of this Agreement by or through the OPERATOR shall remain with the CITY into perpetuity.

2.5Annual Reports and Plans.

A. Preparation and Approval. OPERATOR shall submit to the Director annually on or before March 1st of each year, the Annual Plan and Budget for the Golf Courses for the next Fiscal Year ("Annual Plan"). The Annual Plan shall include: (i) an operating budget containing bona fide good faith estimates of all Direct Costs (as that term is defined in Section 7.1A) in accordance with the Direct Cost Budget Submittal requirements of Section 7.2, and (ii) the Marketing and Promotion Plan for the Golf Courses for the next Fiscal Year in accordance with the requirements of Section 6.7.

The parties understand that, as provided in Section 7.1 E of this Agreement, recommendations and budgets for Capital Improvements will be treated separately and will not form part of the Annual Plan. The Annual Plan shall be subject to written 11245\0001\713339.2 -3-

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approval of the Director. CITY agrees that its staff will be available to examine draft Annual Plans proposed by OPERATOR and to work with OPERATOR to develop an Annual Plan that can be forwarded to the Director; provided, however, that OPERATOR is not required to obtain the approval of CITY staff members before submitting the Annual Plan to the Director. It is contemplated by the parties that the Annual Plan will be agreed upon by OPERATOR and Director not later than sixty (60) days following delivery of the Annual Plan by OPERATOR to the Director. If the Director fails to either approve the Annual Plan within said 60-day period or to advise OPERATOR in writing of his/her objections to the proposed Annual Plan within such period, then the Director shall be deemed to have disapproved the Annual Plan as submitted. Once such a plan has been accepted by the Director, the financial impacts of the plan will be included in the City budget approval process for adoption by the City Council.

B. Compliance. OPERATOR shall comply, to the extent reasonably and commercially practicable, with the applicable Annual Plan and Direct Cost Budget.

C. Quarterly Review of Annual Plan. No less than every three (3) months at the discretion of the Director, the Director and the General Manager(s) of the Golf Courses shall meet and discuss the operating results of the Golf Courses, and the parties shall agree in writing upon any amendments or revisions to the Annual Plan to take into consideration variables or events that did not exist or could not be anticipated by OPERATOR or CITY at the time the Annual Plan was prepared. The Annual Plan and any material amendments or revisions to the Annual Plan shall require the approval in writing of the Director, which approval shall not be unreasonably withheld. Any material financial impacts due to the amendments will be presented to the city council at the mid -cycle budget update or sooner as necessary.

3.0 ACCEPTANCE

3.1 Premises Complete. The OPERATOR acknowledges, agrees and accepts that the Premises are complete and ready to operate, and in general are in good and proper working condition. CITY and OPERATOR acknowledge an assessment of the kitchen and grill areas at the Golf Courses will be conducted and completed by December 1, 2023 to determine current condition of equipment.

4.0 TERM

4.1 Term. The term of this Agreement shall begin on January 1, 2024, and expire on December 31, 2030, subject to earlier termination or cancellation as provided in this Agreement. At the end of the seven-year term, the CITY, upon approval of the City Council, may enter into negotiations with OPERATOR for an additional five-year term, but CITY shall have no obligation to extend this Agreement until and unless the City Council determines to do so on terms and conditions it selects in its sole and absolute discretion. 11245\0001\713339.2 -4-

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5.0 OPERATOR'S BASIC SERVICE OBLIGATIONS.

5.1 Golf Professional Services. OPERATOR shall sell, rent, store and repair golf equipment, sell golf related clothing and supplies, provide instructional services in the playing of golf, rent golf carts and operate driving ranges as set forth in this section 5.1. Such services shall (i) be provided by or under the direct supervision of qualified personnel who have the education, knowledge, and experience commensurate with the duties, and (ii) approved by the Director, which may be given, withheld or withdrawn at any time in the sole and absolute discretion of the Director.

A. Merchandise. OPERATOR shall provide and maintain in the Pro Shops such inventory of golf merchandise as is deemed necessary by Director to adequately meet the public demand therefor. The Director, in her or his sole discretion, shall have the right to prohibit the sale or rental of any item of merchandise on finding(s) that the item is of such quality or nature as to not be in the public interest to be offered for sale or rental, or that such item is not necessary for proper service to the public.

B. Golf Instruction. OPERATOR shall provide for golf instruction by qualified instructors accredited by the PGA. OPERATOR shall cause all golf instructors to comply with the rules and regulations for the play of golf, set forth in the Golf Course Manual.

C. Golf and Beverage Carts. OPERATOR shall maintain the electric power -driven golf and beverage carts provided by the CITY to meet the public demand therefor. OPERATOR may prohibit the use of golf carts on the Golf Courses whenever weather conditions expose the user to danger or the Golf Courses to damage arising from operations thereon.

D. Junior Golf Program. OPERATOR shall implement and promote a Junior Golf Program by providing to CITY or participants therein group lessons, range balls and general golf instructions. OPERATOR shall conduct junior tournaments at reduced -rate entry fees pursuant to CITY'S rules and regulations.

E. Caddy Program. If required by the Director, OPERATOR shall work with the Director to implement a caddy program for youth at the Golf Courses. If a caddy program is implemented, the CITY will adjust the Direct Cost Budget to reflect any additional costs of operation resulting from the caddy program.

F. Golf Course Starter Services. OPERATOR shall render and provide starter services at the Golf Courses including, but not limited to, opening and closing at the appropriate time, collecting greens fees, collecting the City of Fairfield admissions tax, collecting tournament fees, taking reservations electronically or via telephone and from patrons at the Golf Courses and recording the reservations on starter sheets, placing golfers' names on a call sheet as necessary, sending golfers to the tee and starting them off at proper intervals in groups of five, four, three and two, as applicable, receiving requests from groups for tournaments, booking tournaments and 11245\0001\713339.2 -5-

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collecting appropriate fees prior to each tournament's starting date, and coordinating tournament food and beverage needs, taking all actions as necessary to speed play on the Golf Courses, entering each golfer's name on the starter's sheet and issuing a cash register receipt to each golfer upon payment of the applicable greens fee, totaling golf starter sheets at the end of each day's play and reconciling them with fee category totals on cash register detail tape and recording in the daily log book the number of rounds of play and total amount of cash collected by fee category. The daily log book shall also record the number of rounds by resident and non-resident categories, even when those rounds are charged identical fees. Totals from the daily log book on the number of rounds of play by fee categories and by resident/non-resident categories shall be submitted to the Director on a monthly basis.

G. Tournament Starting Times. OPERATOR shall schedule reserved starting times for tournaments in accordance with procedures established in the Golf Course Manual and by the Director.

H. Marshaling Time. OPERATOR shall provide the services of a marshal to be on duty on each Golf Course at all times, with the exception of periods of inclement weather. OPERATOR shall submit a proposed schedule of marshal services for the Director's approval, disapproval or conditional approval with submission of the Annual Plan. The services of the marshals may be provided by volunteers. The primary purpose of the marshals' duties shall be to expedite play on the Golf Courses.

A secondary duty will be to ensure compliance with all Golf Course Manual rules and regulations.

I. Days and Hours of Operation. The minimum hours of operation shall be as set forth in the Golf Course Manual. OPERATOR shall make no changes in the days and hours for operation of the Premises without the prior written approval of the Director.

5.2 Food and Beverage and Banquet Services. OPERATOR shall adequately staff, ensure appropriate food and beverage inventory, equipment and supplies necessary to operate and manage the volume of patronage at the restaurants, grill facilities, catering and banquet service venues. OPERATOR shall hire professional Food and Beverage managers who demonstrate experience commensurate to the training and education required to successfully manage and lead the operation at the Premises. Managers shall be subject to Director approval.

A. Liquor License, Permits, Food Handlinq Certificate. OPERATOR shall apply for and maintain an appropriate license(s) from the Division of Alcohol and Beverage Control (ABC License) sufficient to supply and operate full bar and banquet service at the PREMISES, throughout the term of this Agreement. All reporting requirements will be the sole responsibility of the OPERATOR. OPERATOR shall ensure staff are properly trained and certificated to serve food and sell alcohol. All costs 11 245\000 1\713339.2 -6-

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relating to obtaining the ABC License(s) and staff certifications shall be included in the Direct Cost Budget.

B. Beverage Carts. OPERATOR shall operate roving food and beverage carts on the Golf Courses. Provision of service shall be commensurate with demand and as specified in the Golf Course Manual.

C. Restaurants/Grills — Days and Hours of Operation. OPERATOR shall operate seven (7) days a week and establish regular business hours to support breakfast, lunch, and dinner service. Hours of operation and level of service provided for breakfast, lunch, and dinner shall be detailed in the Annual Plan.

D. Banquet Service — Days and Hours of Operation. OPERATOR shall operate seven (7) days a week and establish regular business hours to support the demand for facility use, special events, and private parties.

E. Security. OPERATOR shall implement reasonable security measures to control liquor intoxication and related problems in and around the Premises and is authorized to require hired security for private rental and to establish minimums based upon the nature of the event. Security measures shall be subject to review and approval by the Director or the Chief of Police for the City of Fairfield ("Chief') in the sole discretion of the Director or Chief.

5.3 Building and Equipment Maintenance Services. OPERATOR shall keep and maintain the Premises, and all buildings, structures, improvements, fixtures, trade fixtures, equipment and utility systems, which may now or hereafter exist on or in the Premises, in good operable, usable and sanitary order and repair and in a good, safe and first-class condition throughout the term of this Agreement. OPERATOR shall provide for such repairs, replacements, rebuilding and restoration as may be required to comply with the requirements of this Agreement and include associated expense in the Direct Cost Budget.

Notwithstanding the foregoing, OPERATOR shall have no obligation to maintain the portion of the Clubhouse occupied by the private health club at Rancho Solano. All such repairs and/or any modifications or additions to the facilities must be approved by the Director prior to implementation.

Should OPERATOR fail, after thirty (30) days written notice from CITY of the need therefor, to perform its obligations under this section, CITY may enter upon the Premises and perform OPERATOR's obligations. Notwithstanding the preceding sentence, in the event of an emergency, CITY may immediately enter upon the Premises without notice to OPERATOR to perform emergency repairs and restoration. The cost of such repairs and restoration constitute a Direct Cost of operation as defined in Section 7.1A, and therefore will be included in that year's calculation of the annual Direct Cost operating expenses. 5AGrounds Maintenance Services. OPERATOR shall provide ground maintenance services to the Premises, including, but not limited to, the obligation 11245\0001\713339.2 -7-

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to mow, edge, trim, overseed, fertilize, aerate, irrigate, sod, change cups, service tees, topdress, raise divots, rake traps, spray, spot irrigate, syringe and renovate turf and shrub areas, as well as to provide weed, disease and pest control, litter control and rubbish removal, parking lot sweeping, tree maintenance, maintenance of irrigation systems including mainlines, pumps, boosters and controllers, to keep swales in good repair and to provide the necessary maintenance of any appurtenant structures and equipment, to maintain the creeks, and to perform other duties as set forth in the Maintenance Standards. In addition, OPERATOR shall maintain the interface slope areas at Rancho Solano, but the obligations of OPERATOR under this paragraph 5.4 shall not include maintaining the Clubhouse landscape and hardscape at Rancho Solano.

OPERATOR shall also provide labor for maintenance services deemed appropriate from time to time by the CITY, including but not limited to irrigation or landscaping projects that occur during the off-peak golf season. OPERATOR shall replace or change any supplies, materials or procedures used by OPERATOR which are found objectionable by Director, within five (5) days' notice to OPERATOR of Director's request for such replacement or change. All costs of such ground maintenance services shall be Direct Cost operating expenses.

A. Standards. All maintenance work shall be performed in accordance with the Maintenance Standards, or if certain work items are not covered therein, in accordance with high quality industry -wide maintenance standards for comparable first- class public facilities in Northern California with comparable maintenance budgets and fees structures. The work shall be performed in accordance with a maintenance schedule to be submitted by OPERATOR to CITY and approved by the Director, which schedule shall be modified from time to time as deemed necessary by the Director to maintain the Premises in accordance with the standards described in the preceding sentence of this paragraph 5.4A. In the event of any conflict in the definition or interpretation of any word, responsibility, service or schedule between this Agreement and the Exhibits attached hereto, such conflict or inconsistency shall be resolved by giving precedence in the following priority order, first priority to the body of the Agreement; then to the Golf Course Maintenance Standards then to the Golf Course Manual then to Operator's Proposal.

B. Inspections. The CITY may conduct both scheduled and unscheduled inspections of the Premises without interrupting the normal operation of the Golf Courses. A copy of the written report of such inspections shall be delivered to OPERATOR. The OPERATOR shall make corrective actions and prepare a written response to the noted exceptions and findings within 30 days of receipt of a copy of the report.

C. Maintenance Personnel. OPERATOR shall provide and maintain in its employ a Class "A" golf course superintendent and maintenance crews at each of the Golf Courses daily during normal working hours, as determined by Director.

OPERATOR's Class "A" Superintendents shall be subject to' approval of the Director.

OPERATOR shall employ sufficient personnel to perform all work required under the Maintenance Standards.
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D. Suspension of Play. OPERATOR shall be responsible for deciding when to temporarily suspend play on the Golf Courses due to inclement weather conditions, when to allow play to resume and when to allow golf carts on the Golf Courses.

E. Equipment Supplies and Materials. OPERATOR shall furnish (as a Direct Cost of operation as defined in Section 7.1A) all necessary equipment, supplies and material of good quality and in sufficient number to fulfill the maintenance requirements of this Agreement. OPERATOR agrees to utilize national accounts and business relationships to the benefit of the CITY. The required equipment, supplies and materials shall include, but not be limited to:
(1) All necessary gas, oil and spare parts for all equipment; (2) All necessary topdressing, seed, fertilizers, fungicides, insecticides and herbicides;
(3) Parts necessary for the repair and maintenance of alt irrigation systems;
(4) Tee towels, soaps, ballwashers, putting green cups and lags, benches, trap rakes, tee markers, tee mats, trash receptacles, trash receptacle liners, cleat brushes and all other pertinent golf course equipment;
(5) Materials for the installation and maintenance of french drains;
(6) Sand for traps on an as -needed basis, of a size, color and quality as determined by the Maintenance Standards or
Director as needed.
(7) All cleaning supplies and equipment for building, kitchen, and furniture maintenance;
(8) All furniture, operating equipment, and supplies for food and beverage and banquet services.
(9) All uniforms and other miscellaneous employee/staff support materials and supplies.

F. Failure to Comply. Should OPERATOR fail, after thirty (30) days' written notice from CITY specifying any such failures to comply with the Maintenance Standards to perform its obligations under this section, CITY may enter upon the Premises and perform OPERATOR's obligations. Notwithstanding the preceding sentence, in the event of an emergency CITY may immediately enter upon the Premises without notice to OPERATOR to perform emergency maintenance, repairs and restoration. The cost of such maintenance, repairs and restoration constitute a 11245\0001\713339.2 -9-

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Direct Cost of operation as defined in Section 7.1A, and therefore will be included in that year's calculation of the annual Direct Cost operating expenses.

5.5 Parkinq Lot Maintenance Services. OPERATOR shall provide regular (i.e., non -capital) parking lot maintenance services to Paradise Valley, including, but not limited to quarterly sweepings per year, curb painting as required, replacing light bulbs, and irrigation and landscaping. All costs of such parking lot maintenance will be Direct Cost operating expenses.

5.6 Restroom Maintenance Services. OPERATOR shall maintain the restrooms on the Golf Courses and in the Facilities in accordance with the Restroom Maintenance Standards section of the Maintenance Standards. All costs of such restroom maintenance will be Direct Cost operating expenses.

5.7Purchase of Capital Equipment. The OPERATOR is authorized to secure capital equipment and replacements for the Golf Courses, and accordingly the CITY has determined that it is in the best interests of the CITY to suspend competitive bidding for the purchase of such capital equipment, provided that such purchases are approved by the Director. All costs of such capital equipment procurement or replacement will be Capital Expenditures subject to the budget process in Section 7.1 E.

6.0 OPERATOR'S OPERATING RESPONSIBILITIES

6.1 Direct Cost Budget Submittal. The OPERATOR shall submit and obtain approval of the Direct Cost Budget for each Fiscal Year in accordance with Section 7.2.

6.2Compliance with Laws. OPERATOR shall comply with all municipal ordinances and all state and federal laws and regulations applicable to the operation of the Premises. OPERATOR shall not knowingly permit any illegal activities to be conducted on or about the Premises. If any permits or licenses are required for an activity of OPERATOR under this Agreement, OPERATOR shall obtain all such required permits or licenses from the appropriate agency before undertaking the activity.

6.3Compliance with Rules and Regulations. OPERATOR shall comply with all rules and regulations set forth in the Golf Course Manual and will enforce all such rules at the Premises.

6.40PERATOR's Obligation to Refrain from Discrimination. OPERATOR shall not discriminate against any person or group of persons on account of race, color, creed, religion, ancestry, national origin, gender or disability in the performance of OPERATOR's duties and obligations under this Agreement.

Neither OPERATOR nor any person claiming under or through it shall establish or permit any practice of discrimination in the hiring of staff, selection of vendors and operators, the access to and use of the Premises or in the performance of OPERATOR's duties and obligations under this Agreement. 11245\0001\713339.2 -1 0-

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6.5 Equal Opportunity Employment. OPERATOR shall be an equal opportunity employer in conformance with all applicable laws.

6.6Signs. OPERATOR shall not post outdoor signs at or on the Premises without the prior approval of the Director.

6.7Public Use: Marketing.

A. OPERATOR shall use its best efforts to effectively market and promote the Premises to insure the financial and operating success of the Premises.

During the First Fiscal Year, OPERATOR shall implement the marketing program described in Operator's Proposal and approved by Director. On or before March 1st of each Fiscal Year as part of its submittal of a proposed Annual Plan pursuant to Section

2.4, OPERATOR shall prepare and submit to the CITY for Director's approval, disapproval or conditional approval a Marketing and Promotion Plan for the following Fiscal Year. OPERATOR shall carry out the approved Marketing and Promotion Plan for each Fiscal Year. OPERATOR's failure to submit and/or implement an approved Marketing and Promotion Plan shall be an event of default by OPERATOR under this Ag reement.

B. OPERATOR shall employ at all times during the Term, a professional Marketing Director reasonably acceptable to the CITY. The Marketing Director shall work on -site to manage and implement OPERATOR's Marketing and Promotion Plan, as approved by the CITY.

C. THIRD PARTY MARKETING. OPERATOR may utilize third party marketers such as online tee time booking services to increase distribution and the sale of tee times, which may include trading tee times at a rate consistent with other similar golf courses in the area. Such trade shall be documented and reported as outlined in

6.12D.5.

6.8Utilities. OPERATOR shall be responsible for arranging for utility service for the Premises, including but not limited to, water, gas, electricity, sewer and trash removal. CITY shall not be responsible for any defect, deficiency or impairment of any utility system, water system, water supply system, drainage system, waste system heating or gas system or electrical apparatus or wires serving the Premises, except that expenses incurred by OPERATOR to correct any such defect, deficiency or impairment shall be included as Direct Costs pursuant to Article 7 of this Agreement.

6.9Safety. OPERATOR shall immediately correct any unsafe condition of the Premises, as well as any unsafe practices occurring thereon. Promptly after the occurrence of injury to persons or damage to property occurring on the Premises, OPERATOR shall submit to Director a report of the incident.

OPERATOR shall cooperate fully with CITY in the investigation of any damage to persons or property occurring on or about the Premises. 11245\0001\713339.2 -1 1-

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6.10 Use of Facilities: Restrictions. Unless OPERATOR has obtained the prior written approval of the Director, which approval may be withheld or conditioned in the sole and absolute discretion of the Director, OPERATOR shall not conduct, authorize or permit: (1) any events or activities on the Premises not otherwise specifically provided for and authorized in this Agreement; or (2) any events or activities requiring the exclusive use of the Premises or any portion thereof, other than normal shotgun tournaments.

6.11 Meetings. Representatives of OPERATOR and the Director shall meet on a monthly schedule and at such other times as may be required by CITY to review OPERATOR' s performance under this Agreement, review the monthly financial reports submitted by the OPERATOR, and discuss any problems or matters as determined by the CITY.

A. Golf Advisory Board. The OPERATOR shall attend the regular quarterly meetings of the Golf Advisory Board and special meetings as deemed necessary.

6.12 Prices.

X A.Goods and Services. The OPERATOR shall at all times maintain a complete list or schedule of the prices charged for all goods and services supplied to the public on or from the Premises. Such list or schedule of prices shall be provided to the Director on request. Such prices shall be fair and reasonable based on the following considerations: that the operation of the Premises is intended to serve the needs of the public for the goods and services supplied at a fair and reasonable cost; that the prices charged should be comparable to prices charged for similar goods and services in the general area; and that the profit margin should be reasonable considering the cost of providing the goods or services in compliance with the obligations of this Agreement. If the Director notifies OPERATOR that the prices being charged are not fair and reasonable, OPERATOR shall have the right to confer with the Director and justify such prices. Following reasonable conference and consultation thereon, OPERATOR shall make such price adjustments as may be ordered by the Director subject to the provisions of Section 6.12A.2; provided, however, that in no event shall OPERATOR be required to price any item below its wholesale cost B. Greens and Driving Range Fees and Golf Cart Rentals. CITY hereby reserves the right to establish the greens fee and driving range fee schedule for patrons of the Premises. Further, CITY hereby reserves the right to establish the golf cart rental fees and other equipment rental fees that may be charged by OPERATOR.

OPERATOR is authorized to adjust all golf course fees up to the 20% flexible price cap using a demand -based pricing strategy. No other fee adjustments may occur without the consent of CITY.

C. Food and Beverage and Banquet Fees. OPERATOR shall be responsible for providing CITY with proposed banquet fees and menu prices for review and approval of Director.
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D. Discounts, Fee Waiver, Donations, Complimentary Use. CITY and OPERATOR acknowledge and agree there are reasonable and appropriate circumstances and standard operating practices for offering discounts, complimentary use, donations and fee waivers, such as, promotion and marketing strategies, providing employee and volunteer benefit programs, expanding use of facilities and participation in golf, and supporting city sponsored community fund raising efforts.

1. Meals EmployeeNolunteers. Golf Course
employees are eligible to receive a fifty percent (50%) discount on their individual meals while on duty. Golf Course employees and volunteers are eligible to receive twenty-five percent (25%) off their individual regular -priced meal at any time during normal business operation and as approved by Food and Beverage manager.

Discount is not eligible for beverages non- or alcoholic.

2. Meals Other. OPERATOR has authority to
discount and/or comp meal(s) as deemed necessary and as it pertains to addressing customer service issues and complaints.

3. Fee Waiver. OPERATOR and CITY agree
to allow Room Fee waiver for City meetings and City -sponsored events. OPERATOR is preauthorized to provide support up to two (2) annual Touchstone Foundation events for fund raising purposes, which must directly benefit the Fairfield community, and up to two (2) annual fundraising events for the Fairfield Community Services Foundation that directly benefit the Fairfield community.

Any other fee waiver must be approved by CITY.

4. Discount on Goods — Employee and
Volunteers. Golf Course employees and volunteers are eligible to purchase retail goods at cost plus fifteen percent (15%) as approved by the General Manager.

5. Complimentary Golf. OPERATOR may
issue complimentary golf passes in its reasonable discretion in support of promoting Golf and increasing revenue. OPERATOR may grant customary privileges for PGA, GCSA, LPGA members and issuing passes to volunteers (including Touchstone
Foundation volunteers), and on a limited basis donate for charitable fund-raising purposes. CITY and OPERATOR to
determine maximum annual contribution limits.

6. Reporting. All discounts, fee waivers,
donations and complimentary passes are required to be formally documented and reported with the monthly financial reports. In addition, on an annual basis a summary report shall be presented at the end of each Fiscal Year which is to include name of 11245\0001\713339.2 -1 3-

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recipient, date issued, estimated dollar amount, and brief description of the benefit/purpose.

7. School Use Agreements. OPERATOR is
authorized to negotiate discounted use agreements with local schools to support High School and College golf teams and as approved by DIRECTOR.

6.13 Admissions Tax. OPERATOR shall comply with the provisions of Section 12C.10 of the Fairfield Municipal Code regarding the payment and collection of the Golf Course Admissions Tax as those sections exist on the date of this Agreement and as they may be amended in the future. Compliance with these provisions includes, but is not limited to, recording all taxable rounds and collecting and remitting all tax revenues to the CITY. The City may audit Admissions Tax collections, and OPERATOR shall make available all information as deemed necessary, in the City's sole and absolute discretion.

6.14 Right of Enta. OPERATOR and its employees and contractors shall have a right of entry to the Golf Courses for the purposes of performing OPERATOR's obligations under this Agreement. CITY and its authorized representatives shall retain the right to enter the Premises at all times for any purposes, including, without limitation: to determine whether the Premises are in good condition and whether OPERATOR is complying with its obligations under this Agreement; to do any necessary maintenance and to make any restoration to the Premises that CITY has the right to perform; to serve, post or keep posted any notices required or allowed under the provisions of this Agreement; and to show the Premises to prospective brokers, agents, buyers, tenants, operators at any time during the term.

6.15 No Assignment. OPERATOR acknowledges that the CITY is entering into this Agreement in reliance on the unique skills and experience of OPERATOR and its employees. Consequently, OPERATOR shall not assign all or any part of its rights or obligations under this Agreement without the prior written consent of Director, which consent may be withheld or conditioned in the sole and absolute discretion of the Director. Any change in the ownership or control of OPERATOR shall constitute an assignment for purposes of this Agreement.

7.0 COMPENSATION
Certain costs of operating and maintaining the Golf Course properties shall be paid by OPERATOR from the Gross Revenues received and deposited in the Bank Accounts as described in Section 8.1 of this Agreement. The Gross Revenues deposited into the Bank Accounts are the property of the CITY and are not part of the consideration paid to the OPERATOR for the performance of OPERATOR's obligations under this Agreement.
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7.1 Definitions.

A. Direct Cost Expenditures. "Direct Costs" (each individually, a "Direct Cost") shall be those costs which are directly related to the resident staff, operation and maintenance of the Premises and which are established by the Direct Cost Budget, including the following:

1. Employee salaries.

2. Employee benefits including vacation, sick leave, health insurance, disability insurance, worker's compensation
insurance and incentive payments.

3. Lease and/or rental of equipment necessary for the
operation of the Premises.

4. Repair and maintenance of golf carts, irrigation systems and golf maintenance equipment.

5. Repair and maintenance of kitchen, restaurant, and banquet facilities.

6. Motor fuel, oil and lubricants.

7. Fertilizers, pesticides, chemicals and grounds maintenance supplies as described in Section 5.4 E. of this Agreement.

8. Uniforms, laundry and linens.

9. Operating supplies, office supplies cleaning supplies and other miscellaneous supplies.

10. Accounting and Audit services.

11. Advertising and marketing expenses.

12. Travel.

13. Telephone, postage and freight.

14. Fees, permits and licenses.

15. Utilities, including natural gas, water, electric power, telephones, propane, garbage and trash collection.

16. Insurance.
17 Parking lot maintenance expenses, including but not limited to the sinking fund contribution required under Section 7.3D. 11 245\000 1 \713339.2 -15-

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B. Direct Cost Budget. The Direct Cost Budget is the total sum budgeted annually for Direct Cost Expenditures by the CITY for both golf Courses pursuant to Section 7.3 of this Agreement.

C. Excluded Operating. Those operating costs which are paid by the CITY and are not included in the Direct Cost Budget include and are limited to the following:

1. Possessory interest taxes, if any.

2. Those maintenance and/or operating costs exceeding
$5,000 per incident that are: (i) due to any reason beyond OPERATOR's reasonable control (an "Occurrence of Force
Majeure") including, without limitation, acts of God, riots, strikes, fires, provided, however, that such expense shall continue only during the pendency of the particular
Occurrence of Force Majeure; and (ii) approved in advance by the Director, which approval will not be unreasonably withheld.

D. Management Fee. Management Fee is the annual amount paid to the OPERATOR in consideration for services performed under this Agreement and as further described in Section 7.5 of this Agreement.

E. Capital Expenditures. Capital Expenditures are defined as expenditures greater than $5,000 for new or replacement equipment or improvements to existing facilities.

1. OPERATOR shall not make Capital
Expenditures prior to obtaining the written approval of the Director.

Capital Expenditures shall not be included in any category of the Direct Cost Budget described in Section 7.1 B.

2. A 5-year Capital List will be developed and
updated on an annual basis; listing by priority order.

3. On or before April 1 of each Fiscal Year,
OPERATOR shall prepare and submit to CITY an annual budget for proposed Capital Expenditures (the "Capital Budget") for the following Fiscal Year. To maintain the aesthetic standards and quality required by CITY with respect to the Premises,
OPERATOR shall also concurrently submit to CITY, a report concerning the condition of the Premises and any Improvements made during that Fiscal Year and plans for any Improvements, upgrading or other changes proposed, for review and approval by the CITY. The proposed Capital Budget for each Fiscal Year shall be approved, disapproved or conditionally approved by the Director in writing with a reasonable time. No proposed Capital 1 1245\0001 \713339.2 -16-

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Expenditures shall be incurred, and no proposed Improvements may be implemented, until OPERATOR receives such written approval of the Director.

F. Cost of Goods Sold. The cost of replacing and adding to the Pro Shop Inventory of golf merchandise and the cost of replacing and adding to the food and beverage and banquet services are defined as the Cost of Goods Sold.

7.2 Direct Cost Budget Submittal. The OPERATOR shall submit to the Director a proposed Direct Cost Budget on or before March 1st of the preceding Fiscal Year as part of the Annual Plan required by Section 2.4 above. Increases in the total amount of Direct Costs in subsequent years shall not exceed the CPI, unless the parties agree that there was a mutual omission in the original Direct Cost Budget or the level of service to be performed by OPERATOR is to be increased. Any increase in excess of the increase in the CPI shall be thoroughly documented in the Annual Plan. The proposed Direct Cost Budget shall comply with the procedures set forth in Sections 7.3 and 7.4 of this Agreement. The Director shall approve, disapprove or conditionally approve the proposed Direct Cost Budget for each Fiscal Year on or before May 15 of the preceding Fiscal Year. The Direct Cost Budget shall be in a format acceptable to the City and shall include, among other line items, the estimated revenues, cost of sales, Direct Cost Expenditures as defined in Sections 7.1 and 7.3, number of employees, number of rounds and management fees as described in Section 7.5. The Director shall have the authority to make changes to the way in which the Direct Cost Budget allocates Direct Cost Expenditure. In the event of a dispute with regard to the approval of the Direct Cost Budget, pending the resolution of such dispute, OPERATOR shall continue to manage and operate the Golf Courses in accordance with the standards set forth in this Agreement at a level of expenditures comparable to those of the preceding Operating Year plus an additional two percent (2%) of such amount. This two percent (2%) shall apply to actual course costs, and shall not include any expenditure not authorized as a Direct Cost pursuant to this Agreement, nor the Fixed Management Fee as defined in Section 7.5A, nor the Incentive Management Fee defined in Section

7.513.

7.3 Direct Cost Budget Calculation. The proposed Direct Cost Budget shall be computed in the following manner:

A. First Fiscal Year. The Direct Cost Budget for expenditures in the First Fiscal Year shall be adjusted in conjunction with the CITY's mid -cycle budget process to account for the inclusion of food, beverage, and banquet services for the months January through June 2024. Thirty (30) days after the end of the Fiscal Year, the OPERATOR shall submit to the CITY a Final Report documenting actual expenditures of Direct Cost and provide report on revenue received related to food, beverage, and banquet services for months January through June 2024. l 1245\0001 \713339.2 -17-

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B. Adiustment in Subsequent Fiscal Years. The proposed Direct Cost Budget for each Fiscal Year after the First and Second Fiscal Year shall be determined by adjusting the Direct Cost Budget for the preceding Fiscal Year in proportion to the CPI October of the second preceding year to October of the immediately preceding Fiscal Year (i.e., Direct Cost Budget x CPI).

C. Level of Detail. The Direct Cost Budget submitted by OPERATOR shall identify the budgeted level of expenditures for each of the expense categories described in Section 7.1A. above.

D. Limitations on Specific Expenses. The OPERATOR shall limit budgeted expenditures in the following specific categories as provided in this Section

7.3:

1. Incentive payments and bonuses to
employees shall be reasonably related to objective performance standards that are identified in the Direct Cost Budget and be approved by the Director.

2. The costs of maintaining the parking lot
areas shall be adjusted as necessary each Fiscal Year, which amount shall be deposited in a sinking fund account set up and maintained by the CITY. This amount is based on annual
restriping and a projection that on average over a twenty-year period there will be a need for two fog seals, two slurry seals and one overlay. The annual sinking fund amount will be adjusted by the CPI. Sealing overlay work shall be performed when the Director makes a determination that the work is required and shall be performed by the OPERATOR or a contractor selected by the CITY in the Director's sole and absolute discretion.

7.4 Direct Cost Budget Savings and Overruns.

A. Line Item Revisions: Year -End Reporting and Payments The OPERATOR shall be entitled to shift items in the Direct Cost Budget, so long as aggregate Direct Cost expenditures do not exceed the total amount of the approved Direct Cost Budget. Thirty (30) days after the end of each Fiscal Year, the OPERATOR shall submit to the CITY a Final Report documenting actual expenditures of Direct Costs for that Fiscal Year.

B. No Incentives or Disincentives. The OPERATOR will not be entitled to any portion of the savings if the level of Direct Costs is less than the Direct Cost Budget during a Fiscal Year, nor shall the OPERATOR be required to pay any portion of cost overruns if the level of Direct Costs is more than the Direct Cost Budget during any Fiscal Year.

C. Termination for Direct Cost Overruns. If the level of Direct Costs is more than the Direct Cost Budget during a Fiscal Year, and the level of such cost l 1245\0001\713339.2 -18-

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overruns is greater than might reasonably be caused by increased levels of patronage of the Premises, the City may terminate this Agreement in accordance with Article 11.

7.5 Management Fee. OPERATOR's Management Fee hereunder shall consist of a Fixed Management Fee and an Incentive Management Fee.

A. Fixed Management Fee. The Fixed Management Fee shall be $92,500 for the First Fiscal Year, and $185,000 for each subsequent Fiscal Year, subject to increases in the CPI beginning in the Second full Fiscal Year, July 2025. In the First Fiscal Year, OPERATOR shall be paid one sixth (1/6t") of the Fixed Management Fee on the last day of each month. In subsequent Fiscal Years, OPERATOR shall be paid one -twelfth (1/12th) of the Fixed Management Fee on the last day of each month.

B. Incentive Management Fee.

1. The intent of the Incentive Management
Fee is to provide an incentive for the OPERATOR to maximize revenue generation through proactively marketing the Premises, improving efficiencies, and enhancing the customer experience.

The Incentive Management Fee shall be comprised of
performance measures inclusive of the above and will be negotiated and established after the first full Fiscal year. Incentive Fee shall not exceed 25% of the base Management Fee.

2. For the First Fiscal Year, CITY agrees to
pay to OPERATOR an amount up to $15,000 specifically for meeting the expectations and timelines outlined in the transition plan for period ending June 30, 2024.(Attached hereto as exhibit A)

3. For the first Full Fiscal Year (2024-2025),
CITY agrees to pay to OPERATOR an amount up to $35,000 for meeting the transition plan expectations and timelines for period of July 1, 2024 through June 30, 2025. (Attached hereto as exhibit B)

4. Not later than thirty days after the end of
each Fiscal Year, the OPERATOR shall submit to the CITY a Final Report documenting performance measures for that Fiscal Year.

5. Within sixty days after the end of the Fiscal
Year the CITY shall pay the OPERATOR any Incentive
Management Fee earned pursuant to Section 7.513.1.

6. If an inspection pursuant to Section 9.2 or
an audit pursuant to Section 9.3 results in a correction of the amount of Gross Revenues: (i) the CITY shall pay the OPERATOR 11245\0001\713339.2 -19-

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any additional incentive payment amount pursuant to Section

7.513.1 above within 30 days of receipt of notice of the correction; or (ii) the OPERATOR shall refund to the CITY the amount of any overpayment of the incentive payment pursuant to Section 7.513.1 above within 30 days of receipt of notice of the correction.

8.0 FINANCIAL AND ACCOUNTING PROCEDURES

8.1 Bank Account. The CITY will maintain separate bank accounts for each Golf Course for the purposes of accepting deposits of the revenues described in Section 8.1A and payment of Direct Costs. The funds in these accounts are the property of the CITY and are held in trust and managed for the CITY.

A. Revenues. All Gross Revenues, fees, interest income and any other revenues from operation of the Premises shall be deposited into the respective bank accounts established and identified by the CITY. Such revenues are to be deposited promptly on a schedule approved by the Director.

B. Rebates. All rebates provided to OPERATOR for procurement of equipment and goods on behalf of the CITY, whether independently or as part of OPERATOR's National Accounts, are to be recognized and reported as revenue and deposited to CITY.

C. Payment of Direct Costs. The OPERATOR shall pay the Direct Costs of operation of the Golf Courses using the check -writing privileges associated with the bank accounts provided that such expenses are included in the approved Direct Cost Budget, and provided further that the CITY shall have the right, it its sole discretion, to approve the person or persons who shall have the authority to sign checks for OPERATOR.

D. Prohibited Expenses. The following expenditures are strictly prohibited:

Any expenditure of funds for purposes other than those
explicitly listed as part of the Direct Cost Budget.

2. Any expenditure of funds for Capital Expenditures.

3. Management fees or incentive payments due to the
OPERATOR or any affiliate of OPERATOR.

E. Check Limit. No payment for more than $15,000 shall be made from the accounts without the express consent of the Director except for the biweekly payroll expense. The OPERATOR may debit the bank accounts for the biweekly payroll expenses.

8.2 Monthly Reports and Transactions.
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A. Monthly Report. Within twenty (20) days of the end of each calendar month the OPERATOR shall provide the CITY with the following reports and documents:

1. Year-to-date balance sheet, cash flow report, and income statement;

2. Duplicate bank statements;

3. A reconciliation between the bank statements and the transaction report;

4. General ledger detail.

In addition, the OPERATOR shall provide the CITY with transaction reports with details on all transactions upon request by the CITY.

B. Account Clearing Transaction. Within ten (10) days after filing the monthly report, the OPERATOR shall make a payment to the CITY of all funds in the accounts in excess of the Working Capital Reserve described in Sections 8.3 and 8.4.

8.3 Beginning Working Capital. The CITY shall deposit on or before January 1, 2024, and shall maintain at all times, an amount on deposit in the accounts of no less than two (2) month's of Direct Costs for the Golf Courses (the "Working Capital Reserve") so as to provide the OPERATOR with sufficient working capital.
8AShortfalls in Working Capital. If the OPERATOR determines that there is or will be a shortfall in the Working Capital Reserve due to higher -than - anticipated Direct Costs, the Director may approve additional CITY deposits in the bank accounts. In such an event the OPERATOR shall provide any and all financial and accounting information requested by the Director to document the need for additional deposits.

8.5 Point of Service System. OPERATOR shall provide a
recommendation to the CITY for a point of service ("POS") system at each Golf Course. Once in place, OPERATOR shall include the annual cost for the applicable software licenses into the Direct Cost Budget. OPERATOR shall include with such recommendation a list of what computer hardware, wiring and "integration" is necessary for the POS system it is recommending.

9.0 BUSINESS RECORDS

9.1 Types of Records. OPERATOR shall maintain a method of accounting for all the revenues and expenses in connection with the operation of the Premises, which shall correctly and accurately reflect the Gross Revenues received and disbursements made by OPERATOR from the operation of the Premises. OPERATOR shall establish and implement adequate internal controls 11245\0001 \713339.2 -21-

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for the operation of the Premises. The method of accounting established for the operation of the Golf Courses shall be separate from the accounting system used for any other business operated by OPERATOR. Such method shall include the keeping of at least the following documents:

A. Regular books of account such as general ledgers showing fixed assets and equipment inventory;
B. Journals including any supporting and underlying documents such as vouchers, checks, tickets, bank statements, etc.;
C. State and Federal income tax returns and sales tax returns and checks and other documents proving payment of sums shown; D. Cash register tapes or computerized records shall be retained so that day-to-day sales can be identified. In addition, the OPERATOR shall maintain the computerized system information by specific area, such as, food sales, liquor sales, banquet, sales, the number of and types of rounds of golf played, customer addresses and associated data, resident versus non-resident status, and the cost per round. Logs showing the dates and times of driving range and greens usage and lessons must be maintained and available at the site for inspection at any time; and E. Accounting of discounted or free services, specifying type of discount and recipient of discount, i.e., employee and/or volunteer food discount.

F. Any other accounting records that CITY, in its sole discretion, deems necessary for proper reporting of Gross Revenues.

9.2Audit of Records. All documents, books and accounting records kept by OPERATOR pursuant to this Article 9 shall be open for inspection by CITY at any reasonable time during the term of this Agreement and for at least three (3) years thereafter. In addition, CITY or its authorized representatives may, from time to time, conduct an audit of the books of the operation of the Premises and observe the operation of the business. The CITY shall use reasonable efforts to minimize the interruption with the normal operation of the Premises during any inspection or audit performed pursuant to the provisions of this Section.

9.3Annual Financial Statements. OPERATOR shall submit audited financial statements for the operation of the Premises including a copy of the applicable audited statement of Gross Revenues and the audit management letter to CITY within one hundred twenty (120) days after each Fiscal Year. The audit shall be performed by an independent certified public accountant acceptable to CITY, and the cost of the audit shall be included as a Direct Cost.

9.4Public Records. OPERATOR acknowledges that all information obtained in connection with the CITY's inspections of the records or audits may be or become subject to public inspection and/or reproduction as public records. 1 1245W001\713339.2 -22-

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10.0 INSURANCE AND HOLD HARMLESS

10.1 Insurance. OPERATOR shall obtain the following insurance:

A. Workers' Compensation Insurance. OPERATOR shall maintain during the term of this Agreement workers' compensation insurance and employer's liability insurance in the amount of $1,000,000 per accident for bodily injury or disease, for all workers employed pursuant to this Agreement and in case any work is subcontracted, OPERATOR shall require its subcontractor(s) similarly to provide workers' compensation insurance for all the latter's employees unless all the employees are covered by such protection afforded by OPERATOR. In case any class of employees engaged in work under this Agreement at CITY facilities is not protected under any workers' compensation law, OPERATOR shall provide protection of employees not otherwise protected. The policy shall contain a waiver of subrogation.

B. Liability and Property Insurance. OPERATOR shall obtain and keep in full force and effect during the term of this Agreement property damage, personal injury, automobile, employers', and comprehensive form liability insurance in the amount of $2,000,000 per occurrence and $4,000,000 aggregate for bodily injury, personal injury and property damage. If Commercial General Liability insurance or other form with a general aggregate limit is used, the general aggregate limit shall be twice the required per occurrence limit. The liability policy shall endorse alcohol and food borne illness liability coverage. CITY and its officers, agents and employees shall be named as additional insureds under the policy, and that the policy shall stipulate that this insurance will operate as primary insurance, and that no other insurance effected by the CITY or other named insureds will be called upon to cover a loss covered thereunder. The policy shall contain a waiver of subrogation.

C. Deductible or Self -Insured Retention. Any deductible or self -insured retentions must be declared to and approved by the CITY. At the option of the CITY, either the insurer shall reduce or eliminate such deductible or self -insured retentions as respects the CITY, its officers, officials, employees and volunteers; or the OPERATOR shall procure a bond guaranteeing payment of losses and related investigation, claims, administration and defense expenses.

D. Automobile Liability, Owned and Non -Owned. OPERATOR shall obtain and keep in full force and effect during the term of this Agreement, automobile liability insurance in the amount of $2,000,000 per accident for bodily injury and property damage for owned and non -owned vehicles and equipment.

E. Fire Insurance. OPERATOR shall maintain on the Premises, a policy of standard fire and extended coverage insurance, with sprinkler damage, vandalism and malicious mischief endorsements, to the extent of at least one hundred percent (100%) of their replacement value, without reduction for depreciation and naming the CITY as loss payee. The proceeds from any such policy shall be used by the CITY for the replacement of real and personal property or the restoration of improvements or alterations if damaged.
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F. Commercial Crime Insurance. OPERATOR shall obtain and keep in full force and effect during the term of this Agreement a commercial crime policy which includes employee dishonesty in the amount of $250,000 and coverage for theft, disappearance and destruction to monies and securities in or on the Premises in the amount of $10,000 and outside the Premises in the amount of $5,000.

G. Other Insurance Provisions. The General Liability and Automobile Liability policies are to be accompanied by appropriate ISO Primary and Additional insured endorsements and must contain the following provisions:

1. The City, its officers, officials, employees, agents, and volunteers are to be covered as insureds as respects: liability arising out of work performed by or on behalf of the Contractor(s); products and completed operations of the Contractor(s); premises owned occupied or use by the Contractor(s); or automobiles owned, leased, hired, or borrowed by the Contractor. The coverage shall contain no special limitations of the scope of protection afforded to the City, its officers, officials, employees, agents or volunteers.

2. For any claims related to this project, the Contractor(s) general liability and auto liability insurance coverage shall be primary and non- contributory insurance as respects the City, its officers, officials, employees, agents or volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, agents or volunteers shall be excess of the Contractor insurance and shall not contribute with it.

3. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be cancelled except after thirty (30) days prior written notice has been given to the entity.

4. Endorsements should be provided on standard ISO forms appropriate to job. Primary and Additional Insured endorsements must be provided and are separate from the certificate. Primary and Additional endorsements may:
• Be an additional cost to the insured
• Not be readily available
• Need to be requested from the underwriter
Preferred endorsements — CG 20 10 11 85 or CG 20 26 11 85 1 l 245\0001 \71333 9.2 -24-

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Any insurance or self-insurance maintained by the City, its officers, officials, employees or volunteers shall be excess or secondary of the insurance an shall not contribute with it. The City needs either a Primary Endorsement or a copy of the actual policy that shows the event sponsor's insurance is primary ("Other Insurance" section of the policy is
acceptable.)

5. We do not accept endorsements or certificates with the wording, "but only in the event of a named insured's sole negligence." H. Certificate of Insurance. OPERATOR shall complete and file in CITY's Department of Parks and Recreation, within fifteen (15) days of the execution of this Agreement, and prior to engaging in any operation or activity set forth in this Agreement, certificates of insurance and endorsements which shall provide that no cancellation, change in coverage or nonrenewal by the insurance company will be made during the term of this Agreement, without thirty (30) days' written notice to CITY prior to the effective date of such cancellation or change in coverage. OPERATOR shall file with the CITY concurrent with the execution of this Agreement, the CITY's standard endorsement form providing for each of the above requirements.

10.2 Waiver of Subrogation. The parties release each other, and their respective authorized representatives, from any claims for damage to any person or to the Premises and the buildings and other improvements in which a portion of the Premises are located, and to the fixtures, personal property, improvements, and alterations in or on the Premises and the building and other improvements in which a portion of the Premises are located that are caused by or result from risks insured against under any insurance policies carried by the parties and in force at the time of any such damage.

10.3 Umbrella Policy. Notwithstanding any provision of Article 10 to the contrary, OPERATOR's obligation to provide for insurance may be brought within the coverage of a so-called "umbrella" or "blanket" policy or policies of insurance carried and maintained by OPERATOR, provided that: (i) CITY, OPERATOR and such other persons as CITY may specify from time to time are named as additional insureds, to the extent their interest appear; (ii) the coverage afforded CITY and the other persons will not be reduced or diminished by reason of the use of such umbrella policy; and (iii) the other insurance requirements as set forth in Article 10 are satisfied.

OPERATOR shall permit CITY, at all reasonable times, to inspect any policies of insurance of OPERATOR covering risks upon the Premises for which policies or copies thereof are not required to be delivered to CITY.
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10.4 Indemnification and Hold Harmless
A. OPERATOR shall defend, indemnify and hold the CITY and its elective and appointive boards, commissions, officers, agents, and employees, harmless from any liability for damage or claims for damage for personal injury, including death, as well as from claims for property damage, asserted by third parties, to the extent they may arise from the negligence or willful misconduct of OPERATOR or OPERATOR's subcontractors, agents, or employees.

B. OPERATOR shall defend, indemnify, and hold harmless the CITY for any fines imposed by administrative or regulatory bodies.

C. OPERATOR shall indemnify CITY for any damages resulting to it from failure of either OPERATOR or any subcontractor to take out or maintain such insurance.

D. OPERATOR shall defend, indemnify, and hold harmless the CITY for any ADA related claim, lawsuit, judgment, or settlement pertaining to the direct denial of access to services or employment at Golf Courses for individual protected under the American with Disabilities Act (ADA) of 1990, by OPERATOR's staff.

However, any ADA related claim, lawsuit, judgement, or settlement pertaining to the direct denial of access to services at the Golf Courses for individuals protected under ADA laws arising from any physical or operational limitation of the Golf Courses not directly caused by OPERATOR's staff shall not be covered by indemnity referenced hereunder and shall be the responsibility of CITY. Any physical areas deemed non- compliant with Laws will be remedied to be fully compliant with Laws at CITY's expense.

E. CITY does not and shall not waive any rights against OPERATOR which CITY may have by reason of Section 10AA because of the acceptance by CITY or deposit with CITY by OPERATOR of any of the insurance policies described in this Article 10. Section 10.4A shall apply to all damages and claims for damages of every kind suffered, or alleged to have been suffered, on the Premises or in connection with the operations of OPERATOR, regardless of whether or not such insurance policies shall have been determined to be applicable to any of such damages or claims for damages.

11.0 DEFAULT

11.1 OPERATOR's Default. The occurrence of any one or more of the following events if not cured within any time permitted after written notice thereof from the CITY to OPERATOR shall constitute a default and breach of this Agreement by OPERATOR: (a) OPERATOR's abandonment of its duties or vacation of the Premises; (b) OPERATOR's expenditure of Direct Costs in excess of the Direct Cost Budget where the level of such costs is greater than might reasonably be caused by increased patronage of the Premises; (c) OPERATOR's failure promptly and fully to perform any other covenant, condition or agreement contained in this Agreement where such failure continues for thirty (30) days after 11245\0001 \713339.2 -26-

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written notice from CITY to OPERATOR or, in the event that any such failure is of a nature such that it cannot be remedied within thirty (30) days, OPERATOR's failure immediately to commence and thereafter continuously to pursue to completion a remedy of such failure; (d) OPERATOR's use of CITY funds for expenses not included in the Direct Cost Budget; (e) the levy of a writ of attachment or execution on this Agreement or on any of the property of OPERATOR located in or on the Premises and such levy or execution is not stayed prior to the enforcement of such writ of attachment or execution; (f) the making by OPERATOR of a general assignment for the benefit of creditors, or of an arrangement, composition, extension or adjustment with its creditors; or (g) the filing by or against OPERATOR of a petition for relief or other proceeding under the federal bankruptcy laws or state or other insolvency laws, where the same is not withdrawn or dismissed within forty-five (45) days, or the assumption by any court or administrative agency, or by a receiver, trustee, or custodian appointed by either, of jurisdiction, custody or control of the Premises or any substantial part of the assets or property of OPERATOR, where such jurisdiction, custody or control remains unrelinquished, unstayed or unterminated for a period of forty-five (45) days.

11.2 Remedies.

A. In the event of OPERATOR's default as described in Section 11.1, CITY shall serve OPERATOR with written notice of the condition(s) constituting the breach which notice shall specify the date by which the breach shall be cured. If OPERATOR fails to cure the breach by the date specified, which date shall be at least thirty (30) days from the date of the notice unless a longer or shorter period is specifically provided in this Agreement, OPERATOR agrees that CITY may elect to undertake any work necessary to diligently maintain the Premises or to otherwise cure the breach. Should CITY elect to undertake such work, it shall serve OPERATOR with two (2) business days' written notice of its intent to enter the Premises and the exact nature of the work or correction it intends to perform. Such notice shall be served personally, or by certified mail, return receipt requested, upon OPERATOR at the address set forth in Section 16. If OPERATOR does not complete such work or provide assurances acceptable to the CITY in its sole and absolute discretion by the end of the two (2) day period, CITY may perform the work, and the performance of the work by CITY shall be at the sole expense of OPERATOR and shall not be included as a Direct Cost.

B. If CITY undertakes work pursuant to the procedure set forth in section 11.2A, CITY shall make demand upon OPERATOR for payment of its costs. If OPERATOR fails to pay the costs incurred by the CITY within 30 days of the date demand is made, the CITY may bring legal action to collect the sums due. OPERATOR agrees that if legal action is necessary to collect the amounts expended by the CITY, OPERATOR shall pay the CITY's reasonable attorney's fees and court costs, together with interest from that date which is 30 days after the CITY has made demand for payment. Any actions to by the CITY pursuant to Sections 11.2A or 11.213 shall not cure any default by the OPERATOR.
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C. If CITY chooses not to correct the condition identified in the notice of default described in Section 11.2A, or the event of default cannot be cured, CITY may terminate this Agreement upon ten (10) days' written notice to OPERATOR.

D. If CITY terminates this Agreement pursuant to this Section 11.2, the CITY shall have the following rights:
(i) to collect from OPERATOR any monies owing to CITY under this Agreement;
(ii) to take sole possession of the Bank Accounts described in Section 8.1 of this Agreement; and
(iii) to pursue any other appropriate civil and criminal remedies.

OPERATOR shall be entitled to any unpaid portion of the management fee attributable to performance which occurred prior to the notice of default, less any damages incurred by the CITY as a result of OPERATOR's default.

12.0 AGREEMENT CANCELLATION

12.1 Cancellation. By giving written notice of cancellation not less than sixty (60) days prior to the cancellation date, the CITY may cancel this Agreement with or without cause at any time after December 31, 2024. By giving written notice of cancellation not less than one -hundred and eighty (180) days prior to cancellation date, the OPERATOR may cancel this Agreement with or without cause at any time after December 31, 2024.

12.2 Rights Upon Cancellation. Upon cancellation of this Agreement pursuant to Section 12.1, the CITY shall have the following rights:
(i) to collect from OPERATOR any monies owing to CITY under this Agreement;
(ii) to take sole possession of the Bank Accounts described in Section 8.1 of this Agreement; and
(iii) to pursue any other appropriate civil and criminal remedies.

OPERATOR shall be entitled to any unpaid portion of the management fee attributable to performance that occurs prior to the cancellation date, less any damages incurred by the CITY as a result of OPERATOR's failure to fully satisfy OPERATOR's obligations under this Agreement

13.0 TRANSITION PROCEDURES

13.1 Contract Transition Period. The "Contract Transition Period" shall mean: (i) the six-month period immediately prior to expiration of the term; (ii) the 1 1245\0001 \713339.2 -28-

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period from the date CITY gives notice of default under Section 11.1 until the date of termination; or (iii) the period from the date either party gives notice of cancellation under Section 12.1 until the date of cancellation.

13.2 Contract Transition Procedures. During the Contract Transition Period:

A. OPERATOR shall allow CITY and others to interview and discuss employment opportunities with OPERATOR's on -site and off -site employees.

B. OPERATOR shall not transfer any on -site employee without the consent of the CITY.

C. OPERATOR and CITY shall refrain from coercing or threatening any employee who expresses interest in being employed by the CITY, the OPERATOR or another party after the contract has expired, terminated or been cancelled.

D. OPERATOR and CITY shall cooperate in good faith on post - agreement support services, data management, inventory control, transfer of employees and other issues necessary to insure smooth transition of operating responsibilities from one party to another.

14.0 STOPPAGES
In the event concerted activities by labor groups (e.g., picketing, strikes, etc.) result in OPERATOR's employees not entering and working at the Premises, OPERATOR shall seek appropriate administrative or court orders to return operations to normal. During such period, OPERATOR shall operate the Premises on a best efforts basis until labor relations are normalized.

15.0 APPEALS
OPERATOR shall have the right to appeal any decision made by the Director in accordance with the following procedures:

15.1 Notification. OPERATOR shall notify the CITY in writing within ten (10) days of any decision by the Director which OPERATOR wishes to appeal, citing all arguments in OPERATOR's behalf. Director shall have ten (10) days in which to respond to OPERATOR's appeal in writing.

15.2 Appeal to City Manager. If OPERATOR is dissatisfied with the Director's decision on the initial appeal, within ten (10) days of the Director's decision OPERATOR may resubmit the appeal to the City Manager who shall either personally or through a representative designated by the City Manager hear and determine the matter in dispute. OPERATOR shall have the right to be present at the hearing by the City Manager or their designated representative.

The City Manager or their designated representative shall issue a written determination not later than 15 days after hearing the matter in dispute. 11245\0001 M 3339.2 -29-

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15.3 Appeal to City Council. If the OPERATOR is dissatisfied with the determination of the City Manager, within ten (10) days of the City Manager's decision the OPERATOR may appeal to the City Council. The City Manager will place the item before the City Council for consideration at the next reasonably available regular meeting of the City Council at the discretion of the City Manager. The determination of the City Council shall be a final decision not subject to further appeal.

15.4 Rules of Evidence in Appeals. In both matters heard by either the City Manager or the City Council, the legal, formal rules of evidence for Courts shall not apply, and both OPERATOR and CITY may informally produce evidence and provide testimony in the spirit of reaching an amicable resolution to the matter.

15.5 Approvals. Except as otherwise provided in this Agreement, a consent or approval referred to herein of either party shall not be unreasonably withheld or conditioned. Whenever either party has called upon the other to execute and deliver a consent or approval in accordance with the terms of this Agreement, the failure of such party to respond to the demand within five (5) business days after written request therefor is given in accordance with the terms hereof, or such other period as specifically set forth in this Agreement, shall be deemed to be a consent or approval. In the event that either party refuses to give its consent or approval to any request by the other, such refusing party shall indicate by written notice to the other the reason for such refusal unless this Agreement permits the consent or approval to be withheld without cause or in the sole discretion of either party.

Neither CITY's execution of this Agreement nor any consent or approval given by CITY hereunder in its capacity as a party to this Agreement shall waive, abridge, impair or otherwise affect CITY's powers and duties as a governmental body. Any requirements under this Agreement that OPERATOR obtain consents or approvals of CITY are in addition to and not in lieu of any requirements of law that OPERATOR obtain approvals or permits. However, CITY shall attempt to coordinate its procedures for giving contractual and governmental approvals so that OPERATOR's requests and applications are not unreasonably denied or delayed.

16.0 MISCELLANEOUS PROVISIONS

16.1 Jurisdiction and Venue. In the event of any dispute, this Agreement shall be interpreted under the laws of the State of California. Venue shall be the Solano County Superior Court, State of California, or the United States District Court, Eastern District of California.

16.2 Severance Clause. If any term of this agreement is, in whole or in part, held to be illegal or unenforceable to any extent under any enactment or rule of law, that term or part shall to that extent be deemed not to form part of this agreement and the enforceability of the remainder of this agreement shall not be affected. 11245\0001 \713339.2 -30-

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16.3 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which, taken together, constitute one and the same agreement.

17.0 NOTICE
Any notice, demand, request, consent, approval or communication that either party desires or is required to give to the other party shall be in writing and shall be deemed given as of the time of hand delivery to the addresses set forth below, or three (3) days after deposit into the United States mail, postage prepaid, by registered or certified mail, return receipt requested. Unless notice of a different address has been given in accordance with this Article 16, all such notices shall be addressed as follows:

If to CITY:

Director of Parks and Recreation
City of Fairfield
1000 Webster Street
Fairfield, California 94533
If to OPERATOR:

Stephen T. Harker, CEO
Touchstone Golf, LLC
1052 Overlook Road
Berkley, CA 94708
With a copy to:

Douglas J. Harker, Executive Vice President
Touchstone Golf, LLC
11612 Bee Cave Road, Suite 150
Austin, Texas 78738
IN WITNESS WHEREOF, the undersigned have executed this Agreement at Fairfield, California, as of the date first written above.

CITY OF FAIRFIELD,
a municipal corp ion
David Gassaway, C
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ATTEST:

City Clerk

TOUCHSTONE GOLF, LLC,
a Delaware limited liability company
By:
resident
Secretary
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EXHIBIT "A"

MANAGEMENT AGREEMENT FOR THE

OPERATION AND MAINTENANCE OF

GOLF COURSES AND FACILITIES
With respect to Section 7.5 B2, the incentive fee of up to $15,000 for First Fiscal Year requires the following to be completed no later than June 30, 2024:

1. Rebranding of Food/Beverage and Banquet Facilities. To include but not limited to: new names for both restaurant areas and banquet facilities, new permanent signage at both facilities, printed and electronic collateral such as menus, brochures and website.

2. Integrated Point of Sale system — encompassing all operations of PREMISES.

3. Finalize Concept Design and prepare bid packages as approved for capital improvement to the restaurant areas at both properties.

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EXHIBIT "B"

MANAGEMENT AGREEMENT FOR THE

OPERATION AND MAINTENANCE OF

GOLF COURSES AND FACILITIES
With respect to Section 7.5 133, the incentive fee of up to $35,000 for Fiscal Year 2024- 2025 requires the following:

1. Finalize Golf Course Manual by October 31, 2024, encompassing the operation and maintenance of the PREMISES, including but not limited to, policies, standardized procedures, operating protocol, maintenance standards, customer service standards, employee handbook, and code of conduct.

2. Conduct Community Survey in April 2025 for the purpose of establishing base line for guest experience as it relates to overall experience, food/beverage quality, golf course condition, banquet services, and customer service.

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APPENDIX A
PCI COMPLIANCE for THIRD PARTY SERVICE PROVIDER (TPSP)
Touchstone Golf, LLC, ("Vendor") agrees to the following with the City of Fairfield ("City")

1. Demonstrate PCI Compliance
PCI DSS Compliance. In the event any Vendor engages in payment card transactions as a part of the services provided to the City, Vendor shall comply with the Payment Card Industry Data Security Standards ("PCI DSS") and any amendments or restatements of the PCI DSS during the Term of this Agreement.

Vendor accepts responsibility for the security of the City's and/or any customer's credit card data in its possession, even if all or a portion of the services to City are subcontracted to third parties.

Vendor covenants and agrees to comply with Visa's Cardholder Information Security Program/CISP, MasterCard's Security Data Program and SDP Rules, and with all other credit card association or National Automated Clearing House Association (NACHA) rules or rules of member organizations (generally "Association"), and further covenants and agrees to maintain compliance with the Payment Card Industry Data Security Standards (PCI DSS), MasterCard Site Data Protection (SDP), and (where applicable) the VISA Payment Application Best Practices (PABP) (collectively, the "Security Guidelines"). .

Vendor shall provide documentation to the City on the following:
a) Level 1 or 2 Compliant: Vendor shall prove the ability to be PCI DSS Service Level 1 or 2 compliant, and that Vendor has proven the ability to not only process credit cards in large volume, but also maintain the highest level of security.
b) Statement on Standards for Attestation Engagements (SSAE).18 Compliant:

Vendor shall prove they are SSAE 18 compliant.
c) Cybersecurity Insurance Policy as listed in Insurance Section of the Agreement d) Within 10 days of execution of the contract, Vendor shall provide an Attestation of Compliance (AOC). Vendor shall annually attest to their PCI DSS security compliance by providing the AOC on the anniversary date of this addendum each year or on the AOC renewal date.

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e) Vendor shall provide a written acknowledgement of responsibilities for PCI controls. The acknowledgement shall provide that Vendor will maintain, on an on -going basis, all applicable PCI DSS requirements to the extent Vendor handles, has access to, or otherwise stores, processes, or transmits City customers' cardholder data or sensitive authentication data or manages the City's cardholder data environment on behalf of the City. f) Within 30 days of any new Payment Card Industry Data Security Standards (PCI DSS) requirements, as issued by the PCI Security Standards Council, Vendor shall provide an updated written acknowledgement of responsibilities to include the new PCI DSS requirements.
g) Within 30 days of contract execution, Vendor shall provide a copy of the Vendor's Incident Response Plan ("IRP") that will be implemented in the event of system and/or data breach/compromise. The IRP must be tested and updated at least annually. The IRP shall include but not be limited to:

Roles, responsibilities, contact names and communication strategies in the event of a data breach/compromise, including notification to the City and the payment card brands (such as Visa and MasterCard).

Specific incident response procedures.
iii. Business recovery and continuity procedures.
iv. Data back-up processes.
v. Analysis of legal requirements for reporting compromises vi. Coverage and responses of all critical system components. vii. Reference or inclusion of incident response procedures from the payment card brands (such as Visa and MasterCard)
h) Vendor shall maintain an inventory of its system components, including, but not limited to: hardware, software, payment devices and locations which are part of its Cardholder Data Environment. Within 30 business days, upon request by the City, Provider shall provide inventory documentation for all its systems components.
i) The City will review and verify Vendor's written acknowledgment of responsibilities for PCI controls, as stated above, at least once a year. Failure of the City to review and verify the written acknowledgment of responsibilities for PCI controls shall not invalidate this Appendix, nor shall it relieve Vendor of their duties under this Appendix.

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2. Security Incident
Vendor shall inform the City of any security incident or data breach. a) Incident Response: Vendor may need to communicate with outside parties regarding a security incident, which may include contacting law enforcement, fielding media inquiries and seeking external expertise as mutually agreed upon, defined by law or contained in the contract. Discussing security incidents which the City should be handled on an urgent as -needed basis, as part of Vendor's communication and mitigation processes as mutually agreed upon, defined by law or contained in the contract.
b) Security Incident Reporting Requirements: Vendor shall report a security incident to the appropriate City contact immediately as defined in the Service Level Agreement (SLA.)
c) Within 3 business days after the initial incident report: Provide City with a written updated report that summarizes the results of the investigative action and corrective/remedial action taken.

3. Breach Responsibilities
This section only applies when a data breach occurs with respect to personal data within the possession or control of the Vendor.

Vendor shall immediately notify the appropriate City contact person by telephone and email in accordance with the agreed upon security plan or security procedures if it reasonably believes there has been a security incident.

Data Breach Reporting Requirements: If Vendor has actual knowledge of a confirmed data breach of the security of the system of the City, Vendor shall (1) promptly notify the City as soon as the breach is discovered by email and telephone but in no cases longer than 24 hours after discovering the breach.

Vendor shall take reasonable measures to address the data breach immediately. "Breach of the security of the system" shall have the same meaning as the term is described in California Civil Code section 1798.29(f) iii. Vendor shall promptly notify the appropriate City contact within 24 hours or sooner by telephone, unless shorter time is required by applicable law, if it confirms that there is, or reasonably believe that there has been a data breach.

Vendor shall (1) cooperate with the City as reasonably requested by the City to investigate and resolve the data breach, (2) promptly implement necessary remedial measures, if necessary, and (3) document responsive actions taken related to the data breach, including any post -incident review of events and actions taken to make changes in business practices in providing the services, if necessary.

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iv. Unless otherwise stipulated, if a data breach is a direct result of Vendor's breach of its contract obligation to encrypt personal data or otherwise prevent its release, Vendor shall bear the costs associated with (1) the investigation and resolution of the data breach (2) notification to individuals, regulators or others as required by state or federal law; (3) a credit monitoring service as required by state or federal law; and (4) a website or a toll -free number and call center for affected individuals as required by state or federal law; v. Assistance in Litigation or Administrative Proceedings. Vendor shall make itself, and any subcontractors, employees, or agents assisting Vendors in the performance of its obligations under the Contract or Addendum, available to City of Fairfield, at no cost to City of Fairfield, to testify as witnesses, or otherwise, in the event of litigation or administrative proceedings being commenced against City of Fairfield, its directors, officers, or employees based upon a claimed violation of applicable privacy and security laws and regulations except where Vendor or its subcontractor, employee or agent is a named adverse party.

PCI COMPLIANCE for THIRD PARTY SERVICE PROVIDER (TPSP)

END OF APPENDIX

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MUTUAL NON -DISCLOSURE AGREEMENT
Regarding Sensitive Proprietary Infrastructure Information This Mutual Non -Disclosure Agreement ("Agreement"), is entered into this 13 day of 2023 ("Effective Date"), by and between the City of Fairfield, ("City'), a municipal corporation of the State of California, and the entity responding to City's above -referenced subject for receiving such information whose name, address, and state of incorporation, are as follows Touchstone Golf, LLC, a Delaware limited liability company. Each party (in such capacity, "Discloser") may disclose or provide access to certain of its confidential or proprietary information to the other party (in such capacity, "Recipient") pursuant to the terms of this Agreement.

WHEREAS, the City, acting through the Information Technology Department, will disclose certain Confidential Information to potential vendors who wish to work with the City, relating to the City's network configuration and infrastructure; and WHEREAS, each potential entity who may work with the City, at the request of the Information Technology Department must have access to such information in order to configure hardware, software, application, or network services; and WHEREAS, in order to release this Confidential Information to potential vendors, the City requires each vendor to enter into this Agreement through its authorized representative and return it to the City as a pre -condition of receiving supplemental documents that contain Confidential Information.

NOW THEREFORE, in consideration of the above recitals and the mutual promises of the parties herein contained, it is agreed by and between the parties as foI lows:

1. "Confidential Information" as used in this Agreement shall mean any and all technical and non -technical information, data, documents, records, and materials provided by or on behalf of the Discloser to the Recipient, including without limitation patent, trade secret, proprietary, and systems security- related information and information related to the current, future, and proposed services of the Discloser, in any form or medium, written or oral. Confidential Information also includes other information that is marked or otherwise identified as confidential or proprietary, or that would otherwise appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used.

Confidential Information shall not include public records subject to disclosure under the California Public Records Act, Government code section 6250 et seq. and 7929.210.

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2. The Recipient agrees that it will not make use of, disseminate, or in any way disclose the Discloser's Confidential Information to any person, firm, or business, except as necessary for the Recipient to work with the Discloser, and any purpose the Discloser has authorized or hereafter authorizes in writing. The Recipient agrees that it shall disclose Confidential Information only to those directors, officers, employees, agents, affiliates, advisors, representatives, or consultants who need to know such information and who have previously agreed, either as a condition to employment or service or in order to obtain the Confidential Information, to be bound by terms and conditions substantially similar to those of this Agreement.

3. The Recipient agrees to hold all Confidential Information of the Discloser in the strictest confidence and treat it with the same degree of care as it accords to its own Confidential Information, and
the Recipient represents and warrants that it exercises reasonable care to protect its own Confidential Information.

4. The Recipient's obligations under Sections 2 and 3 with respect to any portion of the Discloser's Confidential Information shall terminate if the Recipient can document that:
(a) such information was in the public domain at the time it was communicated to the Recipient by the Discloser; (b) such information entered the public domain subsequent to the time it was communicated to the Recipient through no fault of the Recipient; (c) it was in the Recipient's possession free of any obligation of confidence at the time it was communicated to the Recipient by the Discloser (as shown by the Recipient's files and records as of the time of disclosure); (d) it was rightfully communicated to the Recipient by a third party free of any obligation of confidence subsequent to the time that it was communicated to the Recipient by the Discloser; (e) it was developed by employees or agents of the Recipient independently of and without reference to any information communicated to the Recipient by the Discloser; or (f) the communication was in response to a valid order by a court or other governmental body, was otherwise required by law, or was necessary to establish the rights of either party under this Agreement (provided that the Recipient has provided the Discloser with a reasonable opportunity to seek protective legal treatment for such Confidential Information).

5. All materials (including, without limitation, documents, drawings, models, apparatus, sketches, designs, and lists) furnished to the Recipient by the Discloser shall remain the property of the Discloser and shall be returned promptly upon request, together with any copies thereof, or destroyed with the consent of the Discloser.

6. The Recipient shall not assign or transfer any rights or obligations under this Agreement without the prior written consent of the Discloser.

7. Recipient's obligations under this Agreement shall survive the termination of any other contractual agreement between the parties.

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8. This Agreement shall be governed in all respects by the laws of the United States ofAmerica and bythe laws of the State of California. The sole jurisdiction and venue for any dispute arising under this Agreement shall be the state and federal courts located in Solano County, CA, and each parry to this Agreement hereby submits to such jurisdiction and venue.

9. This Agreement may only be changed by mutual agreement of authorized representatives of the parties in writing.

10. The Recipient acknowledges and agrees that irreparable injury may result to the Discloser if the Recipient breaches the provisions of this Agreement and that damages may be an inadequate remedy in respect of such breach. The Recipient agrees in advance that, in the event of such breach, the Discloser shall be entitled to the granting of injunctive relief in the Discloser's favor, in addition to such other remedies, damages and relief as may be available under applicable law.

11. This Agreement shall not be construed in any manner to be an obligation to enter into further contract or to reimburse the cost of any effort expended by Recipient.

12. This agreement constitutes the entire agreement of the parties with respect to the subject matter hereof. In the event of a dispute or a claim by a party to enforce its rights under this Agreement, the non -prevailing party shall pay all of the prevailing party's reasonable legal fees. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective successors, transferees, and assignees.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

RECIPIENT:

Y -.4
Name: klark Luthman
Title: President
Date: 10/11/2023

CITY OF FAI
By:

Name: _� 6mI ( I)G
Title:

Date: �! 113IZ3

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Role: Primary - serve as Ambassador for City's golf courses Customer service — greet players, promote golf special events and tournaments Etiquette — assist/monitor pace of play, inform/remind players of responsibility to fill divots, raking bunkers, ball mark repair
Course Beautification — assist with trash pick-up on courses and surrounding property, and as needed, fill divots, repair ball marks
Qualification: Selection through a formal application/interview process; pass background check, keep current on all mandated City training; maintain good standing Volunteer Appreciation: Annual food/golf event for all volunteers (course site rotates each year) Benefit Eligibility: Volunteer member is required to work a minimum of 3 shifts per month.

Benefit is solely applicable to individual volunteer (no guest/family/friends).

Benefit: The benefits below are available to volunteers.

The ability to play golf is based on available tee -times on the day of play.

Standby only - daily wait list, first come -first serve as tee times are available.

Volunteers playing in an Outing, Tournament, Group Play, or any organized play with a contracted price with the golf course, will pay the contracted fee and may not utilize their complimentary round.

No guarantee made to accommodate complimentary golf. Complimentary rounds earned, reset every 30 days.

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Agenda Item No: K.3
I//r
Oit
F

AGENDA REPORT
DATE: July 7, 2026
TO: Mayor and Council
FROM: David Gassaway, City Manager
SUBJECT: Resolution 2026-157 FN CFD Bonds One Lake (Planning Area 5) Authorizing the Issuance and Sale of Special Tax Bonds for City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) with Respect to its Improvement Area No. 1, and Approving and Authorizing Related Documents and Actions Funding Source: N/A
Contact: John Furtado, (707) 428-7629

RECOMMENDED ACTION
Adopt resolution.

STATEMENT OF ISSUE
City Council previously conducted proceedings under the Mello -Roos Community Facilities Act of 1982 ("Mello -Roos Act") to form (i) "City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" ("CFD 2023-1") and (ii) "Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" ("Improvement Area No. 1").

After the original formation proceedings, the City undertook change proceedings for Improvement Area No. 1 in order to (among other things) adopt an Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 ("RMA") and increase the bonded indebtedness limit for Improvement Area No. 1 from $90,000,000 to $100,000,000.

Staff recommends that the council adopt the attached resolution in order to authorize the sale of Special Tax Bonds, Series 2026A ("2026A Bonds") for CFD 2023-1 with respect to Improvement Area No. 1 in an amount not to exceed $15,250,000 and approve related documents and actions, including the Preliminary Official Statement, Continuing Disclosure Certificate, First Supplement to Fiscal Agent Agreement, and Bond Purchase Agreement.

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11L"IWral0l
Background Information About the One Lake Project and the Related Development Agreement.

The property in Improvement Area No. 1 is part of a 358.5-acre master -planned community known as "One Lake" (One Lake Project) being developed by One Lake Holding LLC, a Delaware limited liability company (Master Developer). The One Lake Project comprises the property known as Planning Area 4 and Planning Area 5 of the Fairfield Train Station Specific Plan, adopted by the council on July 26, 2011, as amended (Specific Plan).

The One Lake Project is being developed in numerous phases that are anticipated to ultimately consist of 1,937 single-family and multi -family homes and a 190-unit apartment complex, with approximately 20,000 square feet of commercial/retail space. The Master Developer is not a homebuilder and is developing the property through the sale of finished lots to merchant builders.

Improvement Area No. 1 comprises the majority of Planning Area 5. Planning Area 4 is within a separate community facilities district previously formed by the City and known as the City of Fairfield Community Facilities District No. 2019-1 (One Lake) ("CFD No. 2019-1").

Ownership and Development of Planning Area 5; Improvement Area No. 1.

The property within Improvement Area No. 1 is anticipated to be improved with 932 residential units, 12.77 acres of public parks, and public street improvements. The residential units are anticipated to consist of 816 single-family detached homes and 116 single-family detached courtyard cluster homes. As of June 1, 2026, the date of value of the Appraisal (as defined below), the property in Improvement Area No. 1 consisted of 120 completed homes, 41 lots with homes under construction, 52 parcels with building permits pulled, 191 finished lots and 528 rough - graded lots.

As of June 1, 2026, the following merchant builders ("Merchant Builders") and land -banking entities had acquired the following lots within Improvement Area No. 1:
• Lennar Homes of California, LLC, a California limited liability company ("Lennar Homes"), had acquired 131 lots within Neighborhood 0 and Neighborhood R. • Tri Pointe Homes Holdings (formerly known as TRI Pointe Homes, Inc.), a Delaware corporation, or an affiliate thereof ("Tri Pointe"), had acquired 20 lots in Neighborhood L and 20 lots in Neighborhood K-1.
• Century Communities of California, LLC, a Delaware limited liability company ("Century Communities"), had acquired all of the 69 lots in Neighborhood J. • KB Home North Bay LLC, a Delaware limited liability company ("KB Home"), closed escrow on all of the 85 lots in Neighborhood C.
• DRP CA4, LLC ("K. Hovnanian Land Bank"), as assignee of K. Hovanian Homes Northern California, Inc., a California corporation ("K. Hovnanian"), closed escrow on all of the 67 lots in Neighborhood A/B.

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The Master Developer reports that it is continuing to market the other neighborhoods to merchant builders.

The ownership and development status of Improvement Area No. 1 as of June 1, 2026, is summarized below in the following table:

Property Owner/
Merchant Builder
Number of Lots
Development Type
Development Status (1)
Lennar Homes
52 Single Family Detached
Finished Lots
Tri-Pointe
33 Courtyard Clusters
Finished Lots
Century Communities
61 Single Family Detached
Finished Lots
K. Hovnanian (1)
67 Single Family Detached
Finished Lots
KB Home
85 Single Family Detached
Finished Lots
Individual Homeowners
94 Both
Completed Homes
Master Developer (2)
540
Both
Rough Graded/Finished Lots
932
(1) All of these lots are currently held by the K. Hovnanian Land Bank. (2) Tri Pointe is scheduled to acquire the12 lots in neighborhood K-2 from the Master Developer on or about June 30, 2026.

Outstanding 2024A Bonds.

The City is authorized to levy special taxes and incur indebtedness for and on behalf of CFD 2023- 1 to finance the costs of infrastructure associated with the One Lake Project.

Pursuant to a Fiscal Agent Agreement, dated as of December 1, 2024 ("Master Fiscal Agent Agreement"), by and between the City and The Bank of New York Mellon Trust Company, N.A. ("Fiscal Agent"), council previously issued the following special tax bonds on behalf of CFD 2023- 1 with respect to Improvement Area No. 1 ("2024A Bonds"): $36,500,000 Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) Special Tax Bonds, Series 2024A.

Proposed 2026A Bonds.

The City will use the proceeds of the 2026A Bonds to acquire authorized public improvements from the Master Developer. Pursuant to the resolution, the effective interest rate on the 2026A Bonds cannot exceed 6.000%. Based on current market conditions, the 2026A Bonds are estimated to be issued in the amount of $14,040,000 and carry a true interest cost of approximately 5.160%.

Based on the appraisal completed by BBG, Inc., the value of the property in Improvement Area No. 1 has been determined to be not less than $203,805,000 as of June 1, 2026. The value to lien ratio (which compares the market value of the property in Improvement Area No. 1 to the principal amount of the 2024A Bonds, the proposed principal amount of the 2026A Bonds to be issued and the principal amount of bonds issued by overlapping community facilities districts and assessment districts) will be at least 3:1.

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The financing is expected to close in August 2026. Debt service on the 2026A Bonds is payable only from special taxes levied annually on taxable properties within Improvement Area No. 1 of CFD 2023-1 in the manner set forth in RMA. The 2026A Bonds will not have any impact on the City's General Fund.

Proposed Resolution and Related Documents.

In order to complete the financing, council is being asked to approve each of the following:
• Resolution. Resolution of the City Council authorizing the issuance of bonds for CFD 2023- 1 with respect to Improvement Area No. 1 and approving related documents and actions. • Preliminary Official Statement. The Official Statement is the primary disclosure document for investors in the 2026A Bonds. A Preliminary Official Statement will be circulated to potential investors prior to the pricing of the 2026A Bonds. After the 2026A Bonds have been priced, a Final Official Statement will be circulated to investors; the Final Official Statement should be identical to the Preliminary Official Statement except for the addition of pricing information (principal amount, interest rates, redemption terms).

The Preliminary Official Statement describes the special taxes to be levied in the Improvement Area No. 1 and the ownership of and development plans and status for the property within Improvement Area No. 1. The Preliminary Official Statement will also include the appraisal of the taxable parcels in Improvement Area No. 1.

The Preliminary Official Statement is prepared by Jones Hall, serving the City as disclosure counsel for this transaction, with the assistance of the financing team, including City staff; the Master Developer; the merchant builders; the City's municipal advisor; Stifel Nicolaus and Company, Incorporated ("Underwriter"), the underwriter of the 2026A Bonds; and the City's special tax consultant.

The Preliminary Official Statement has been reviewed and approved for transmittal to the council by the City's financing team. The distribution of the Preliminary Official Statement by the City is subject to federal securities laws, including the Securities Act of 1933 and the Securities Exchange Act of 1934. These laws require the Preliminary Official Statement to include all facts that would be material to an investor in the 2026A Bonds. Material information is information that there is a substantial likelihood that would have actual significance in the deliberations of the reasonable investor when deciding whether to buy or sell the bonds. If the council concludes that the Preliminary Official Statement includes all facts that would be material to an investor in the 2026A Bonds, it must adopt a resolution that authorizes staff to execute a certificate to the effect that the Preliminary Official Statement has been "deemed final." The Securities and Exchange Commission (SEC), the agency with regulatory authority over the City's compliance with the federal securities laws, has issued guidance as to the duties of the council with respect to its approval of the Preliminary Official Statement. In its "Report of Investigation in the Matter of County of Orange, California as it Relates to the Conduct of the

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Members of the Board of Supervisors" (Release No. 36761 / January 24, 1996) ("Release"), the SEC stated that, if a member of the council has knowledge of any facts or circumstances that an investor would want to know about prior to investing in the 2026A Bonds, whether relating to their repayment, tax-exempt status, undisclosed conflicts of interest with interested parties, or otherwise, he or she should endeavor to discover whether such facts are adequately disclosed in the Preliminary Official Statement. In the Release, the SEC stated that the steps that a member of the council could take include becoming familiar with the Preliminary Official Statement and questioning staff and consultants about the disclosure of such facts.

The key sections of the Preliminary Official Statement are summarized below:
• "THE 2026 BONDS": This section summarizes the key terms of the 2024 Bonds, including payment dates and redemption provisions.
• "SECURITY FOR THE BONDS": This section summarizes key security terms, including the City's pledge of special tax revenues, its covenant to levy special taxes according to the RMA and its covenant to foreclose on parcels that are delinquent in the payment of special taxes. The 2026A Bonds are a limited obligation of the City, payable only from special taxes levied in Improvement Area No.1 and monies in the funds and accounts established under the Fiscal Agent Agreement described below.
• "THE DISTRICT AND IMPROVEMENT AREA NO. 1": This section summarizes certain features of Improvement Area No. 1, including the appraised value of taxable property, overlapping taxes, assessments and debt and anticipated debt service coverage provided by maximum special taxes that may be levied under the RMA.
• "PROPERTY OWNERSHIP AND DEVELOPMENT STATUS": This section includes information provided by the Master Developer and the merchant builders and describes the proposed development in Improvement Area No. 1 and its current status. • "BOND OWNERS' RISKS": This section highlights the primary risks associated with the 2026A Bonds, including failure to complete the proposed development, natural disasters and failure of property owners to pay their special taxes.
• "LEGAL MATTERS —Tax Exemption": This section describes the tax-exempt nature of interest on the 2026A Bonds.

In addition to the Preliminary Official Statement, council is being asked to approve the following documents:
• Continuing Disclosure Certificate. Under SEC Rule 15c2-12, the Underwriter may only purchase the 2026A Bonds if it has determined that the City is obligated to provide continuing disclosure, including annual updates of the financial and operating data included in the Official Statement and notices of certain specified events. The Master Developer and Lennar Homes each will also provide continuing disclosure on a semi- annual basis, and the Preliminary Official Statement describes the circumstances under which their disclosure obligations will terminate.

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• First Supplement to the Fiscal Agent Agreement. The First Supplement to Fiscal Agent Agreement ("First Supplement") supplements the Master Fiscal Agent Agreement for the purpose of providing for the issuance ofthe2026A Bonds and the use of special taxes from Improvement Area No. 1 to pay debt service on the 2024A Bonds and the 2026A Bonds.

The special taxes will be levied on the regular County tax roll and collected by the County from each taxable parcel in Improvement Area No. 1. The County will remit these special taxes to the City. The City will remit them to the fiscal agent as provided for in the Fiscal Agent Agreement. The Fiscal Agent will use the revenues to (1) pay administrative costs of CFD 2023-1 and (2) pay principal of and interest on the 2024A Bonds and the 2026A Bonds to the bond owners.
• Bond Purchase Agreement. At the time the 2026A Bonds are sold, the City will enter into a Bond Purchase Agreement with the Underwriter, who will agree to underwrite the 2026A Bonds subject to satisfaction of the conditions described in the Bond Purchase Agreement. The resolution provides the Underwriter's discount on the purchase of the 2026A Bonds shall not exceed 1.800% of the par amount of the 2026A Bonds.

FINANCIAL IMPACT
There is no General Fund or fiscal impact to the City. The 2026A Bonds will be payable only from special taxes levies in Improvement Area No. 1.

PUBLIC CONTACT/ADVISORY BODY RECOMMENDATION
N/A

ALTERNATIVE ACTION
The council may choose not to approve the attached resolution, in which case the 2026A Bonds would not be issued. However, pursuant to the Development Agreement, the City has agreed to cooperate with the Master Developer in forming CFD 2023-1 and issuing indebtedness for CFD 2023-1.

COORDINATED WITH
City Attorney's Office

STAFF CONTACT
John Furtado, Director of Finance
(707) 428-7629
[email protected].�ov

ATTACHMENTS
Attachment 2: Proposed Resolution
Attachment 3: Appendix A Government Code Section 5852.1 Disclosure Attachment 4: Preliminary Official Statement, Including Continuing Disclosure Certificate as Appendix E
Attachment 5: Bond Purchase Agreement

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Attachment 6: First Supplement to Fiscal Agent Agreement Attachment 7: Resolution 2023-35

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CITY OF FAIRFIELD
RESOLUTION NO. 2026-157

AUTHORIZING THE ISSUANCE AND SALE OF SPECIAL TAX BONDS FOR CITY OF FAIRFIELD COMMUNITY FACILITIES DISTRICT NO. 2023-1 (ONE LAKE PLANNING AREA 5) WITH RESPECT TO ITS IMPROVEMENT AREA NO. 1, AND APPROVING AND AUTHORIZING RELATED

DOCUMENTS AND ACTIONS
WHEREAS, the council has conducted proceedings under and pursuant to the Mello -Roos Community Facilities Act of 1982, as amended, Chapter 2.5 of Part 1 of Division 2 of Title 5 (commencing with Section 53311) of the California Government Code ("Mello -Roos Act"), to form "City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" ("CFD") and "Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" ("Improvement Area No. 1"), to authorize the levy of special taxes upon the land within Improvement Area No. 1 and issue bonds secured by the special taxes levied in Improvement Area No. 1 for financing certain public improvements ("Authorized Facilities") in the aggregate principal amount of $90,000,000, all as described in those proceedings; and WHEREAS, on October 18, 2016, by Resolution No. 2016-237, the council adopted a Resolution adopting local goals and policies for community facilities districts (the "Goals and Policies"); and WHEREAS, pursuant to Resolution No. 2023-35, which was adopted by the council on February 21, 2023 ("Original Resolution of Issuance"), the council authorized the issuance of up to $90,000,000 of bonded indebtedness and other debt on behalf of the CFD with respect to Improvement Area No. 1, directed staff to prepare documentation for such bonded indebtedness and other debt and return to this council for approval of such documentation; and WHEREAS, pursuant to Resolution No. 2024-253, which was adopted by the council on October 15, 2024 ("First Supplemental Resolution of Issuance") and a Fiscal Agent Agreement, dated as of December 1, 2024 ("Master Fiscal Agent Agreement"), by and between the City and The Bank of New York Mellon Trust Company, N.A. ("Fiscal Agent"), the council previously issued the following special tax bonds on behalf of the CFD with respect to Improvement Area No. 1 ("2024 Bonds"): $36,500,000 Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) Special Tax Bonds, Series 2024A; and WHEREAS, the council now wishes to supplement the Original Resolution of Issuance to provide for the issuance of one or more additional series of special tax bonds (the "Bonds") on a parity basis with the 2024 Bonds to finance a portion of the Authorized Facilities and related costs and expenses; and
WHEREAS, there has been submitted to this council a form of a First Supplement to the Fiscal Agent Agreement between the City and the Fiscal Agent ("First Supplement"; together with the Master Fiscal Agent Agreement, "Fiscal Agent Agreement"), which supplements the Master Fiscal

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RES. NO. 2026-157

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Agent Agreement for the purposes of issuing one or more additional series of special tax bonds, and this council with the aid of its staff has reviewed the First Supplement and found it to be in proper order; and
WHEREAS, there has also been submitted to this council a form of preliminary Official Statement in connection with the marketing of the Bonds and this council, with the aid of its staff, has reviewed the preliminary Official Statement to assure disclosure of all material facts relating to the Bonds, and the council wishes to approve the distribution of the preliminary Official Statement; and
WHEREAS, in accordance with Government Code Section 5852.1, the council has obtained and wishes to disclose the information set forth in Appendix A hereto; and WHEREAS, all conditions, things and acts required to exist, to have happened and to have been performed precedent to and in the issuance of the Bonds and the levy of the special taxes as contemplated by this Resolution and the documents referred to herein exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Mello -Roos Act.

NOW, THEREFORE, THE COUNCIL OF THE CITY OF FAIRFIELD HEREBY RESOLVES:

Section 1. Recitals. The foregoing recitals are true and correct.

Section 2. Bonds Authorized. Pursuant to the Mello -Roos Act, the Original Resolution of Issuance, this Resolution and the Fiscal Agent Agreement, one or more series of Bonds, in an aggregate principal amount not to exceed $15,250,000, are hereby authorized to be issued. The Bonds shall be dated, bear interest at the rates, mature on the dates, be issued in the form, be subject to redemption, and otherwise be issued on the terms and conditions, all as set forth in the Fiscal Agent Agreement and in accordance with this Resolution; provided, however, that the interest rate borne by each series of Bonds shall not exceed the maximum rate authorized in this Resolution. The Bonds may be issued as tax-exempt bonds or as taxable bonds. The Fiscal Agent, an Authorized Officer (as defined herein) and other responsible officers of the City are hereby authorized and directed to take such actions as are required to cause the delivery of the Bonds upon receipt of the purchase price thereof.

Section 3. Compliance with the Goals and Policies. The council hereby finds that the issuance of the Bonds is in compliance with the Mello -Roos Act and applicable provisions of the City's Goals and Policies. More specifically, this council hereby makes the following determinations:
a. The rate and method of apportionment of special taxes for Improvement Area No. 1 is in compliance with the Goals and Policies.

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RES. NO. 2026-157

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b. The appraisal described in the preliminary Official Statement (the "Appraisal") has been prepared in accordance with the Goals and Policies. c. Section 53345.8 of the Mello -Roos Act requires, with certain exceptions, that the value of the real property subject to special taxes levied in Improvement Area No. 1 must be at least three times the principal amount of the Bonds and the principal amount of all other bonds that will be outstanding following issuance of the Bonds that are secured by a special tax levied pursuant to the Mello -Roos Act on property within the Improvement Area No. 1 or a special assessment levied on property within Improvement Area No. 1, and this council hereby determines that the Appraisal concludes that the market value of the property within Improvement Area No. 1 (subject to the various assumptions and conditions set forth in the Appraisal) is at least three times (i) the maximum initial principal amount of the Bonds authorized by this Resolution and (ii) the outstanding principal amount of all other outstanding bonds that are secured by a special tax or special assessment levied on property within Improvement Area No. 1.
d. The provision requiring property owners to provide continuing disclosure as long as they own property that is responsible for at least 10% of the special taxes in Improvement Area No. 1 is hereby waived so that the threshold can be established for the Bonds at a level acceptable to the Underwriter.

Section 4. Authorities Granted. To the extent permitted by law, the Mayor, the City Manager, the Finance Director or such other official of the City as may be designated by the Mayor, the City Manager or the Finance Director (each, an "Authorized Officer") is hereby authorized and directed to execute and deliver the documents approved herein in substantially the form on file with the City Clerk, together with such additions or changes as are approved by such Authorized Officer upon consultation with the City Attorney and the City's bond counsel, including such additions or changes as are necessary or advisable to permit the timely issuance, sale and delivery of the Bonds. The approval of such additions or changes shall be conclusively evidenced by the execution and delivery by an Authorized Officer of the documents herein specified.

Section 5. First Supplement to Fiscal Agent Agreement. The council hereby approves the form of the First Supplement with respect to the Bonds, in substantially the form on file with the City Clerk. The date, manner of payment, interest rate or rates, interest payment dates, denominations, form, registration privileges, manner of execution, place of payment, terms of redemption and other terms of the Bonds shall be as provided in the First Supplement as finally executed and delivered. The terms and provisions of the First Supplement, as executed, are incorporated herein by this reference as if fully set forth herein. An Authorized Officer is hereby authorized and directed to execute the First Supplement on behalf of the City, with such changes, additions or deletions as may be approved by the Authorized Officer, and the City Clerk is hereby authorized and directed to attest thereto, subject to such First Supplement complying with the terms set forth in this Resolution.

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RES. NO. 2026-157

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Section 6. Official Statement. The council hereby approves the Official Statement prepared in connection with the Bonds in the form on file with the City Clerk, together with any changes therein or additions thereto deemed advisable by an Authorized Officer after consultation with the City's disclosure counsel. The Board hereby approves and authorizes the distribution by the Underwriter of the Bonds (defined below) of the preliminary Official Statement to prospective purchasers of the Bonds, and authorizes and directs an Authorized Officer on behalf of the City to deem the preliminary Official Statement "final" pursuant to Rule 15c2-12 under the Securities Exchange Act of 1934 ("Rule") prior to its distribution to prospective purchasers of the Bonds.

The execution of the final Official Statement, which shall include then current financial information regarding Improvement Area No. 1 and such other changes and additions thereto deemed advisable by an Authorized Officer and such information permitted to be excluded from the preliminary Official Statement pursuant to the Rule, shall be conclusive evidence of the approval of the Official Statement by the City.

Section 7. Continuing Disclosure. The council hereby approves the form of the continuing disclosure certificate ("Continuing Disclosure Certificate") with respect to the Bonds in the form thereof attached to the Official Statement on file with the City Clerk. An Authorized Officer is hereby authorized and directed to complete and execute the Continuing Disclosure Certificate on behalf of the City with such changes, additions or deletions as may be approved by the Authorized Officer in consultation with the City's disclosure counsel.

Section 8. Bond Purchase Agreement. The council hereby approves the form of the Bond Purchase Agreement ("Purchase Contract") providing for the sale of the Bonds by the City to Stifel, Nicolaus & Company, Incorporated, as underwriter ("Underwriter"), on file with the City Clerk and each of the Authorized Officers is hereby authorized to execute the Purchase Contract in the form so approved, with such additions thereto and changes therein as are necessary to conform the Purchase Contract to the dates, amounts and interest rates applicable to the Bonds as of the sale date or as are approved by an Authorized Officer upon consultation with the City Attorney and the City's bond counsel; provided that the maximum amount of Underwriter's discount on the sale of each series of Bonds may not exceed 1.800% of the par amount of such series of Bonds, and the true interest cost of each series of Bonds may not exceed 6.000%.

Approval of such additions and changes shall be conclusively evidenced by the execution and delivery of the Purchase Contract by an Authorized Officer. This council hereby finds that sale of the Bonds to the Underwriter at a negotiated sale pursuant to the Purchase Contract will result in a lower overall cost than would be achieved by selling the Bonds utilizing competitive bidding.

Section 9. Bond Delivery. The Bonds shall be prepared, executed and delivered to the Fiscal Agent for authentication, all in accordance with the terms of the Fiscal Agent Agreement and the Purchase Contract.

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RES. NO. 2026-157

Page 5 ends

Section 10. Actions Authorized. All actions heretofore taken by the officers and agents of the City (including, but not limited to, the Authorized Officers) with respect to the establishment of the CFD and Improvement Area No. 1, the annexation of properties to Improvement Area No. 1, the levy of the special tax and the issuance of the Bonds are hereby approved, confirmed and ratified, and the appropriate officers of the City are hereby authorized and directed to do any and all things and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to accomplish the purposes of this Resolution and consummate the lawful issuance and delivery of the Bonds in accordance with this Resolution, any determination authorized by this Resolution, and any certificate, agreement, and other document described in the documents herein approved. All actions to be taken by an Authorized Officer, as defined herein, may be taken by such Authorized Officer or any designee, with the same force and effect as if taken by the Authorized Officer.

Section 11. Effectiveness. This Resolution shall take effect upon its adoption.

PASSED AND ADOPTED this 7t" day of July 2026, by the following vote:

AYES: MEMBERS: VACCARO/BERTANI/CARR/PAN DURO/SANDHU/TONNESE N/WILLIAMS NOES: MEMBERS:

ABSENT: MEMBERS:

ABSTAIN: MEMBERS:

MAYOR
ATTEST:

CITY CLERK

Page 281 of 550 ends

Appendix A
Government Code Section 5852.1 Disclosure
The good faith estimates set forth herein are provided with respect to the Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the City by PFM Financial Advisors LLC, the City's Municipal Advisor, in consultation with the Underwriter.

Principal Amount. The Municipal Advisor has informed the City that, based on the CFD financing plan and current market conditions, its good faith estimate of the aggregate principal amount of the Bonds to be sold is $15,250,000, not including original issue premium (the "Estimated Principal Amount").

True Interest Cost of the Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the true interest cost of the Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the Bonds, is 5.160%.

Finance Charge of the Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the finance charge for the Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Bonds), is $538,680. Such fees and charges include fees for bond and disclosure counsel, municipal advisor, appraiser, market absorption consultant, special tax consultant, fiscal agent, city attorney and staff time related to bond issuance, set -aside for Fiscal Year 2025-26 CFD administrative expenses, printing, and underwriting.

Amount of Proceeds to be Received. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the amount of proceeds expected to be received on behalf of the CFD and Improvement Area No.1 for sale of the Bonds, less the finance charge of the Bonds, as estimated above, and any reserves or capitalized interest paid or funded with proceeds of the Bonds, is $12,755,633.

Total Payment Amount. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the total payment amount, which means the sum total of all payments that the Improvement Area No.1 property owners will make to pay debt service on the Bonds, plus the finance charge for the Bonds, as described above, not paid with the proceeds of the Bonds (including the Bond proceeds deposited into a debt service reserve fund), calculated to the final maturity of the Bonds, is $30,963,700.

Page 282 of 550 ends

RES. NO. 2026-

Page 2 ends

The foregoing estimates constitute good faith estimates only. The actual principal amount of the Bonds issued and sold, the true interest cost thereof, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates due to (a) the actual date of the sale of the Bonds being different than the date assumed for purposes of such estimates, (b) the actual principal amount of Bonds sold being different from the Estimated Principal Amount, (c) the actual amortization of the Bonds being different than the amortization assumed for purposes of such estimates, (d) the actual market interest rates at the time of sale of the Bonds being different than those estimated for purposes of such estimates, (e) other market conditions, or (f) alterations in the CFD financing plan, delays in the financing, or a combination of such factors. The actual date of sale of the Bonds and the actual principal amount of Bonds sold will be determined by the City based on the timing of the need for proceeds of the Bonds and other factors. The actual interest rates borne by the Bonds will depend on market interest rates at the time of sale thereof. The actual amortization of the Bonds will also depend, in part, on market interest rates at the time of sale thereof. Market interest rates are affected by economic and other factors beyond the control of the City.

Page 283 of 550 ends

E a) JH Draft: 6/22/2026
PRELIMINARY OFFICIAL STATEMENT DATED [ ], 2026
L �
°
O �
Q w NEW ISSUE —BOOK -ENTRY ONLY NOT RATED
In the opinion of Jones Hall LLP, San Mateo, California, Bond Counsel, subject, however to certain qualifications described s herein, under existing law, the interest on the 2026 Bonds is excluded from gross income for federal income tax purposes, and is L o not an item of tax preference for purposes of the federal alternative minimum tax imposed on individuals; however, such interest on T the 2026 Bonds may be taken into account for the purpose of computing the alternative minimum tax imposed on certain corporations. In the further opinion of Bond Counsel, such interest is exempt from California personal income taxes. See "LEGAL 0 0 MATTERS- Tax Exemption."
Cn �p .!� $U*
tr-� � �_ IMPROVEMENT AREA NO. 1 OF THE
° CITY OF FAIRFIELD
m o
° COMMUNITY FACILITIES DISTRICT NO. 2023-1
° 3 (ONE LAKE PLANNING AREA 5)
° .o � a)
� SPECIAL TAX BONDS, SERIES 2026A
Dated: Date of Delivery Due: September 1, as shown on inside cover 0 0 Cn Authority for Issuance. The bonds captioned above (the "2026 Bonds") are being issued by the City of Fairfield (the "City") T r for and on behalf of the "City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" (the "District") with ° o - respect to its "Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" N o ("Improvement Area No. 1 "), pursuant to the Mello -Roos Community Facilities Act of 1982, as amended (the "Act"), the Resolution o= of Issuance and a Fiscal Agent Agreement dated as of December 1, 2024 (the "Master Fiscal Agent Agreement"), as supplemented m .o by a First Supplement to Fiscal Agent Agreement dated August 1, 2026 (as supplemented, the "Fiscal Agent Agreement"), by and 2 ) between the City, for and on behalf of the District, and The Bank of New York Mellon Trust Company, N.A., as fiscal agent (the °
cn ,. _ "Fiscal Agent").

QUse of Proceeds. The 2026 Bonds are being issued to (i) finance the acquisition and construction of certain facilities and ° o improvements to be owned and operated by the City, (ii) contribute additional funds to the debt service reserve fund established o and held by the Fiscal Agent under the Fiscal Agent Agreement securing the 2026 Bonds and the 2024 Bonds, (iii) pay capitalized interest on the 2026 Bonds through 20_, and (iv) pay the costs of issuing the 2026 Bonds.

Z :Ln Security and Sources of Payment. The 2026 Bonds are payable from proceeds of Special Tax Revenues levied on property E CO a) within Improvement Area No. 1 according to the rate and method of apportionment of special tax approved by the City Council and o the eligible landowner voters in Improvement Area No. 1, as amended. The 2026 Bonds are secured by a first pledge of all of the 0 0 .`o_ Special Tax Revenues and the moneys on deposit in certain funds held by the Fiscal Agent under the Fiscal Agent Agreement, on a a parity with (i) the bonds previously issued by the District captioned "$36,500,000 City of Fairfield Community Facilities District No. .= 3 2023-1 (One Lake Planning Area 5) Special Tax Bonds, Series 2024A" (the "2024 Bonds"), and (ii) additional bonds that may be ° . issued in the future ("Parity Bonds") on a parity with the 2026 Bonds and the 2024 Bonds, subject to the conditions set forth in the ° �' = Fiscal Agent Agreement. See "SECURITY FOR THE BONDS" and "THE 2026 BONDS - Issuance of Future Parity Bonds." 2) a Bond Terms; Redemption. Interest on the 2026 Bonds is payable on March 1, 2027, and semiannually thereafter on each w ° March 1 and September 1. The 2026 Bonds will be issued in integral multiples of $5,000. The 2026 Bonds, when delivered, will be c _ 7
r °3 initially registered in the name of Cede & Co., as nominee of The Depository Trust Company ("DTC"), New York, New York. DTC `m will act as securities depository for the 2026 Bonds. The 2026 Bonds are subject to optional redemption, mandatory sinking fund .F, L redemption and mandatory redemption from prepaid Facilities Special Taxes. See "THE 2026 BONDS - Redemption." r ° The 2026 Bonds, the interest thereon, and any premiums payable on the redemption of any of the 2026 Bonds, are not cc) E .° an indebtedness of the City (except to the limited extent described in this Official Statement), the State of California (the °Z3
.5- "State") or any of its political subdivisions, and neither the City (except to the limited extent described in this Official 6 .� .C)
o Statement), the State nor any of its political subdivisions is liable on the 2026 Bonds. Neither the faith and credit nor the ° °_ taxing power of the City (except to the limited extent described in this Official Statement) or the State or any political o o subdivision thereof is pledged to the payment of the 2026 Bonds or interest thereon. Other than the Facilities Special �
Taxes, no taxes are pledged to the payment of the 2026 Bonds. The 2026 Bonds are not a general obligation of the City, o but are limited obligations of the City payable solely from the Special Tax Revenues as more fully described in this Official oL) Statement.
m 3 MATURITY SCHEDULE
(see inside cover)
This cover page contains certain information for quick reference only. It is not a summary of the issue. Potential E � investors must read the entire Official Statement to obtain information essential to the making of an informed investment -'- decision. Investment in the 2026 Bonds involves risks which may not be appropriate for some investors. See "BOND OWNERS' RISKS" for a discussion of special risk factors that should be considered in evaluating the investment quality of ° the 2026 Bonds.
o The 2026 Bonds are offered when, as and if issued and accepted by the Underwriter, subject to approval as to their legality by Jones Hall LLP, San Mateo, California, Bond Counsel, and subject to certain other conditions. Jones Hall LLP is also serving as disclosure counsel to the City. Certain matters will be passed upon for the City by Richards, Watson and Gershon, San Francisco, California, acting as the City Attorney. Stradling Yocca Carlson & Rauth LLP, Newport Beach, California, is serving as counsel to a the Underwriter, and Cox, Castle Nicholson LLP, San Francisco, California, is serving as counsel to One Lake Holding LLC, the ° o r Master Developer. It is anticipated that the 2026 Bonds, in book -entry form, will be available for delivery through the facilities of o DTC on or about [j, 2026.

Page 284 of 550 ends

STIFEL
The date of this Official Statement is: 2026.
* Preliminary; subject to change.

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MATURITY SCHEDULE*
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2026A
$ Serial Bonds
Maturity Date Principal Interest CUSIPt
(September 1) Amount Rate Yield Price (Base )
% Term Bond due September 1, 20_, Yield: %, Price:

CUSIPt No.
% Term Bond due September 1, 20_, Yield: %, Price:

CUSIPt No.

C Priced to first optional redemption date of at
t CUSIP Global Services (CGS) is managed on behalf of American Bankers Association by FactSet Research Systems Inc. Copyright(c) CUSIP Global Services. This data is not intended to create a database and does not serve in any way as a substitute for the CGS database. CUSIP(c) numbers are provided for convenience of reference only. Neither the City nor the Underwriter or their agents or counsel assume responsibility for the accuracy of such numbers. * Preliminary; subject to change.

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[TO COME]

CITY OF FAIRFIELD

CITY COUNCIL
[Vacant], Mayor'
Pam Bertani, Vice Mayor
K. Patrice Williams, Councilmember
Scott Tonnesen, Councilmember
Doug Carr, Councilmember
Doriss Panduro, Councilmember
Manveer Sandhu, Councilmember

CITY EXECUTIVE STAFF
David Gassaway, City Manager
John Furtado, Director of Finance
Sanjay Mishra, Public Works Director
David Zellers, Director of Community Development

CITY TREASURER
Arvinda Krishnan

CITY CLERK
Karen L. Rees

CITY ATTORNEY
Richards, Watson & Gershon
San Francisco, California

PROFESSIONAL SERVICES

BOND AND DISCLOSURE COUNSEL
Jones Hall LLP
San Mateo, California

MUNICIPAL ADVISOR
PFM Financial Advisors LLC
San Francisco, California

SPECIAL TAX CONSULTANT
Goodwin Consulting Group, Inc.

Sacramento, California

APPRAISER
BBG, Inc.

Sacramento, California

FISCAL AGENT
The Bank of New York Mellon Trust Company, N.A.

San Francisco, California

Page 287 of 550 ends

GENERAL INFORMATION ABOUT THIS OFFICIAL STATEMENT
No Offering May Be Made Except by this Official Statement. No dealer, broker, salesperson or other person has been authorized to give any information or to make any representations with respect to the 2026 Bonds other than as contained in this Official Statement, and if given or made, such other information or representation must not be relied upon as having been authorized.

No Unlawful Offers or Solicitations. This Official Statement does not constitute an offer to sell or the solicitation of an offer to buy in any state in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation.

Effective Date. This Official Statement speaks only as of its date, and the information and expressions of opinion contained in this Official Statement are subject to change without notice. Neither the delivery of this Official Statement nor any sale of the 2026 Bonds will, under any circumstances, create any implication that there has been no change in the affairs of the City, the District, any other parties described in this Official Statement, or in the condition of property within Improvement Area No. 1 of the District since the date of this Official Statement.

Use of this Official Statement. This Official Statement is submitted in connection with the sale of the 2026 Bonds referred to herein and may not be reproduced or used, in whole or in part, for any other purpose. This Official Statement is not a contract with the purchasers of the 2026 Bonds.

Preparation of this Official Statement. The information contained in this Official Statement has been obtained from sources that are believed to be reliable, but this information is not guaranteed as to accuracy or completeness. The Underwriter has provided the following sentence for inclusion in this Official Statement: The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibilities to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information.

Document References and Summaries. All references to and summaries of the Fiscal Agent Agreement or other documents contained in this Official Statement are subject to the provisions of those documents and do not purport to be complete statements of those documents.

Bonds are Exempt from Securities Laws Registration. The issuance and sale of the 2026 Bonds have not been registered under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, in reliance upon exemptions for the issuance and sale of municipal securities provided under Section 3(a)(2) of the Securities Act of 1933 and Section 3(a)(12) of the Securities Exchange Act of 1934.

Estimates and Projections. Certain statements included or incorporated by reference in this Official Statement constitute "forward -looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995, Section 21 E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended. Such statements are generally identifiable by the terminology used such as "plan," "expect," "estimate," "budget" or other similar words.

The achievement of certain results or other expectations contained in such forward -looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements described to be materially different from any future results, performance or achievements expressed or implied by such forward -looking statements. The City does not plan to issue any updates or revisions to those forward -looking statements if or when its expectations, or events, conditions or circumstances on which such statements are based occur.

The City maintains an Internet website, but the information on the website is not incorporated in this Official Statement.

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TABLE OF CONTENTS
Paqe
Paqe
INTRODUCTION ............................................... 1 Master Developer Financing Plan for
FINANCING PLAN ............................................ 7 Improvement Area No. 1 ..........................59
Facilities Financing Plan ................................ 7 The Master Developer .................................. 63 Estimated Sources and Uses of Funds .........
7 Lennar Homes..............................................65 THE 2026 BONDS ............................................ 8 BOND OWNERS' RISKS.................................81 Authority for Issuance .................................... 8 Risks of Real Estate Secured Investments
General Bond Terms ..................................... 8 Generally .................................................. 81 Redemption ................................................... 9 Limited Obligation of the City to Pay Debt
Issuance of Future Parity Bonds .................
11 Service.....................................................81 Registration, Transfer and Exchange..........
14 Potential Early Redemption of Bonds from
DEBT SERVICE SCHEDULE .........................
16 Facilities Special Tax Prepayments .........81
SECURITY FOR THE BONDS ........................
17 Concentration of Property Ownership ..........82
General........................................................ 17 Levy and Collection of the Facilities Special
Limited Obligation ........................................ 18 Tax...........................................................82 Facilities Special Taxes ............................... 18 Property Tax Delinquencies .........................83 Amended Rate and Method ........................
19 Future Property Development ......................84 Covenant to Foreclose ................................
25 Value to Lien Ratios.....................................84 Special Tax Fund ........................................ 27 Risks Related to Homeowners with High
Bond Fund ................................................... 29 Loan to Value Ratios ................................ 85 2024 Reserve Fund ..................................... 31 Payment of Facilities Special Tax is not a
Investment of Moneys in Funds ..................
32 Personal Obligation of the Property

THE DISTRICT AND IMPROVEMENT AREA
Owners.....................................................85 NO. 1........................................................... 33 Appraised Values.........................................85 Formation and Background .........................
33 Property Values ............................................ 85 Description and Location ............................. 34 Other Possible Claims Upon the Value of
Authorized Facilities .................................... 34 Taxable Property ...................................... 88 Projected Special Tax Revenues ................
36 Exempt Properties ........................................ 89 Appraised Values ........................................ 37 FDIC/Federal Government Interests in
Appraised Value -to -Debt Ratios ..................
38 Properties ................................................. 89 Direct and Overlapping Governmental
Depletion of 2024 Reserve Fund .................91
Obligations .............................................. 42 Bankruptcy Delays.......................................91 Estimated Tax Burden on Single -Family
Cyber Security..............................................92 Homes ..................................................... 43 Disclosure to Future Purchasers ..................
92 History of Facilities Special Tax Collection
Public Health Emergencies ..........................93
and Delinquencies ...................................
44 No Acceleration Provisions ..........................93 Potential Consequences of Facilities
Loss of Tax Exemption.................................93 Special Tax Delinquencies ......................
44 IRS Audit of Tax -Exempt Bond Issues .........
93 PROPERTY OWNERSHIP AND
Impact of Legislative Proposals,
DEVELOPMENT STATUS ..........................
46 Clarifications of the Code and Court
The One Lake Project .................................
46 Decisions on Tax Exemption ....................
93 Development Agreement .............................
49 Voter Initiatives ............................................. 94 Conditions of Approval ................................ 50 No Ratings — Limited Secondary Market for
Public Infrastructure Improvements
Bonds.......................................................95 Required for the One Lake Project..........
53 LEGAL MATTERS...........................................96 Improvement Area No. 1 Development
Legal Opinions.............................................96 Status Summary ......................................
54 Tax Exemption.............................................96 Existing and Planned Sales to Merchant
No Litigation.................................................97 Builders...................................................56 CONTINUING DISCLOSURE ..........................
98 Entitlements ................................................. 57 NO RATING.....................................................99 Environmental Matters ................................
57 UNDERWRITING ............................................. 99 PROFESSIONAL FEES.................................100 -I-

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TABLE OF CONTENTS
(continued)

APPENDIX A
— General Information About the City of Fairfield and Solano County

APPENDIX B
— Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)

APPENDIX C
— Summary of Certain Provisions of the Fiscal Agent Agreement

APPENDIX D
— DTC and the Book -Entry Only System

APPENDIX E
— Form of City Continuing Disclosure Certificate

APPENDIX F
— Form of Master Developer Continuing Disclosure Certificate

APPENDIX G
— Form of Merchant Builder Continuing Disclosure Certificate

APPENDIX H
— Form of Opinion of Bond Counsel

APPENDIX I
— Appraisal Report

APPENDIX J
— Community Facilities District Boundary Map
-ii-

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[REGIONAL LOCATION MAP]
-iii-

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AERIAL PHOTO
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
-iv-

Page 292 of 550 ends

OFFICIAL STATEMENT
$L]'
IMPROVEMENT AREA NO. 1 OF THE

CITY OF FAIRFIELD
COMMUNITY FACILITIES DISTRICT NO. 2023-1
(ONE LAKE PLANNING AREA 5)
SPECIAL TAX BONDS, SERIES 2026A

INTRODUCTION
This introduction is not a summary of this Official Statement. It is only a brief description of and guide to, and is qualified by, more complete and detailed information contained in the entire Official Statement, including the cover page, the inside cover and attached appendices, and the documents summarized or described in this Official Statement. A full review should be made of the entire Official Statement. The offering of the 2026 Bonds to potential investors is made only by means of the entire Official Statement. Capitalized terms used but not defined in this Official Statement have the definitions given in the Fiscal Agent Agreement (as defined below).

This Official Statement, including the cover page, inside cover and attached appendices, is provided to furnish information regarding the bonds captioned above (the "2026 Bonds") to be issued by the City of Fairfield (the "City") for and on behalf of the "City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" (the "District") with respect to its "Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5)" ("Improvement Area No. 1").

The City. The City, which comprises approximately 37 square miles, is located in the County of Solano (the "County") approximately 44 miles northeast of San Francisco and 42 miles west of Sacramento. For economic and demographic information regarding the City and County, see "APPENDIX A — GENERAL INFORMATION ABOUT THE CITY OF FAIRFIELD AND SOLANO COUNTY."
Authority for Issuance of the 2026 Bonds. The 2026 Bonds are issued under the Act, a resolution adopted by the City Council of the City on July 7, 2026 (the "Resolution of Issuance"), and a Fiscal Agent Agreement dated as of December 1, 2024 (the "Master Fiscal Agent Agreement"), as supplemented by a First Supplement to Fiscal Agent Agreement dated as of August 1, 2026, (as so supplemented, "Fiscal Agent Agreement"), by and between the City, for and on behalf of the District, and The Bank of New York Mellon Trust Company, N.A., as fiscal agent (the "Fiscal Agent"). See "THE 2026 BONDS — Authority for Issuance." Purpose of the 2026 Bonds. The proceeds of the 2026 Bonds will be used primarily to finance the acquisition and construction of certain facilities to be owned and operated by the City.

The proceeds of the 2026 Bonds will also be used to (i) contribute additional funds to the debt service reserve fund established and held by the Fiscal Agent under the Fiscal Agent Agreement (the "2024 Reserve Fund") securing the 2026 Bonds and the 2024 Bonds (as defined below), (ii) * Preliminary; subject to change.
-1-

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fund partial capitalized interest on the 2026 Bonds through March 1, 2027, and (iii) pay the costs of issuing the 2026 Bonds. See "FINANCING PLAN."
The District. The District and Improvement Area No. 1 were formed and established in February 2023 by the City Council of the City (the "City Council"), as legislative body of the District, under the Mello -Roos Community Facilities Act of 1982, as amended (the "Act"), pursuant to a resolution adopted by the City Council following a public hearing, and a landowner election at which the qualified electors of Improvement Area No. 1 authorized the City to incur bonded indebtedness for the District with respect to Improvement Area No. 1 to be secured by the levy of the Facilities Special Taxes (as defined below), and approved the levy of special taxes for the purpose of financing authorized facilities (the "Facilities") and authorized services in accordance with the Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the "Original Rate and Method").

On October 15, 2024, the City completed change proceedings for Improvement Area No. 1 in order to (among other things) amend the Original Rate and Method and approve the Amended and Restated Rate and Method of Apportionment of Special Tax for Improvement Area No. 1 of the City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) (the "Amended Rate and Method"). The change proceedings also increased the bonded indebtedness limit for Improvement Area No. 1 from $90,000,000 to $100,000,000.

See "THE DISTRICT AND IMPROVEMENT AREA NO. 1 — Formation and Background." Special Taxes. The Amended Rate and Method provides for a Facilities Special Tax (the "Facilities Special Tax") to be levied for the payment of debt service on the Bonds and the costs of the Facilities, and a Services Special Tax (the "Services Special Tax") which will be levied for certain public services after a Transition Event, which is generally defined as a determination that all Bonds have been fully repaid or defeased, and no further Facilities are intended to be funded with the proceeds of the Facilities Special Tax. Only the Facilities Special Tax is pledged toward the payment of debt service on the 2026 Bonds.

Security and Sources of Payment for the 2026 Bonds. Pursuant to the Fiscal Agent Agreement, the 2026 Bonds are secured by and payable from a first pledge of all of net proceeds of the Facilities Special Taxes (as more particularly defined in the Fiscal Agent Agreement, the "Special Tax Revenues"), on a parity with (i) the bonds previously issued by the District captioned "$36,500,000 City of Fairfield Community Facilities District No. 2023-1 (One Lake Planning Area 5) Special Tax Bonds, Series 2024K issued by the City under the Master Fiscal Agent Agreement (the "2024 Bonds"), and (ii) any additional bonds that may be issued in the future, subject to the conditions set forth in the Fiscal Agent Agreement ("Parity Bonds"). See "THE 2026 BONDS — Issuance of Future Parity Bonds." The 2026 Bonds will be additionally secured by certain funds and accounts established and held under the Fiscal Agent Agreement. See "SECURITY FOR THE BONDS."
The 2026 Bonds, the 2024 Bonds and any Parity Bonds issued in the future are referred to herein as the "Bonds."
The 2026 Bonds, the interest thereon, and any premiums payable on the redemption of any of the 2026 Bonds, are not an indebtedness of the City (except to the limited extent described in this Official Statement), the State of California (the "State") or any of its political subdivisions, and neither the City (except to the limited extent described in this Official Statement), the State nor any of its political subdivisions is liable on the 2026 Bonds. Neither the faith and credit nor the taxing power of the City (except to the limited -2-

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extent described in this Official Statement) or the State or any political subdivision thereof is pledged to the payment of the 2026 Bonds or interest thereon. Other than the Facilities Special Taxes, no taxes are pledged to the payment of the 2026 Bonds. The 2026 Bonds are not a general obligation of the City, but are limited obligations of the City payable solely from the Special Tax Revenues as more fully described in this Official Statement.

Debt Service Reserve Fund. In order to further secure the payment of principal of and interest on the 2026 Bonds, the 2024 Bonds and any future series of 2024-Related Parity Bonds (as defined herein), a portion of the proceeds of the 2026 Bonds will be deposited into the 2024 Reserve Fund in an amount necessary to increase the amount on deposit therein to the 2024 Reserve Requirement (as defined herein). See "FINANCING PLAN — Estimated Sources and Uses of Funds" and "SECURITY FOR THE BONDS — 2024 Reserve Fund." Redemption of 2026 Bonds before Maturity. The 2026 Bonds are subject to optional redemption, mandatory sinking fund redemption and mandatory redemption from prepaid Special Taxes. See "THE 2026 BONDS — Redemption."
Covenant to Foreclose. The City has covenanted in the Fiscal Agent Agreement to cause foreclosure proceedings to be commenced and prosecuted against certain parcels with delinquent installments of the Facilities Special Taxes. See "SECURITY FOR THE BONDS — Covenant to Foreclose."
One Lake Project Overview. The property in Improvement Area No. 1 is part of a 358.5- acre master -planned community known as "One Lake" (the "One Lake Project") being developed by One Lake Holding LLC, a Delaware limited liability company (the "Master Developer"). The One Lake Project comprises the property known as Planning Area 4 and Planning Area 5 of the Fairfield Train Station Specific Plan, adopted by the City Council on July 26, 2011, as amended (the "Specific Plan").

The One Lake Project is being developed in numerous phases that are anticipated to ultimately consist of 1,927 single-family and multi -family homes and a 190-unit apartment complex, with approximately 20,000 square feet of commercial/retail space. The Master Developer is not a homebuilder and is developing the property through the sale of finished lots to merchant builders.

The development of Planning Area 4 is now nearing build -out with more than 596 single- family homes owned by individuals in CFD No. 2019-1 and a 190-unit apartment complex on a 5- acre site (not part of CFD No. 2019-1).

The One Lake Project contains a number of community amenities shared by Planning Area 4 and Planning Area 5, including a 10-acre lake and an 11-acre public park, and a community clubhouse and swimming pool open to One Lake Project homeowners. . Planning Area 4 is within CFD No. 2019-1, a separate community facilities district previously formed by the City, and not subject to the Facilities Special Tax securing the 2026 Bonds.

See "THE DISTRICT AND IMPROVEMENT AREA NO. 1" and "PROPERTY OWNERSHIP AND DEVELOPMENT STATUS."
-3-

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Property Ownership and Proposed Development in Improvement Area No. 1. The property within Improvement Area No. 1 is anticipated to be improved with 932 residential units,

12.77 acres of public parks, and public street improvements. The residential units are anticipated to consist of 816 single-family detached homes and 116 single-family detached courtyard cluster homes.

As of June 1, 2026, the following merchant builders (the "Merchant Builders") and land - banking entities had acquired the following lots within Improvement Area No. 1:
• Lennar Homes of California, LLC, a California limited liability company ("Lennar Homes"), had acquired 131 lots within Neighborhood O and Neighborhood R. • Tri Pointe Homes Holdings (formerly known as TRI Pointe Homes, Inc.), a Delaware corporation, or an affiliate thereof ("Tri Pointe"), had acquired 20 lots in Neighborhood L and 20 lots in Neighborhood K-1.
• Century Communities of California, LLC, a Delaware limited liability company ("Century Communities"), had acquired all of the 69 lots in Neighborhood J. • KB HOME North Bay LLC, a Delaware limited liability company ("KB"), had acquired all of the 85 lots in Neighborhood C.
• DRP CA4, LLC (the X. Hovnanian Land Bank"), as assignee of K. Hovnanian Homes Northern California, Inc., a California corporation ("K. Hovnanian"), closed escrow on all of the 67 lots in Neighborhood A/B.

The Master Developer will continue to market the other neighborhoods to merchant builders to be identified in the future.
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The ownership and development status of Improvement Area No. 1 as of June 1, 2026, is summarized below in the following table. As of June 1, 2026, the date of value of the Appraisal (as defined below), the property in Improvement Area No. 1 consisted of 120 completed homes, 41 homes under construction, 52 parcels with building permits pulled, 191 finished lots, and 528 rough -graded lots.

Property
Ownership/Merchant Number of Development
Builder Lots Development Type Status
Lennar Homes 52 single family detached finished lots
Tri Pointe 33 courtyard clusters finished lots
Century Communities 61 single family detached finished lots K. Hovnanian (1) 67 single family detached finished lots KB 85 single family detached finished lots
Individual Homeowners 94 single family detached completed homes and courtyard clusters
Master Developer (2) 540 single family detached rough graded and and courtyard clusters finished lots
932
(1) All of these lots are currently held by the K. Hovnanian Land Bank. (2) Tri Pointe is scheduled to acquire the12 lots in neighborhood K-2 from the Master Developer on or about June 30, 2026.

See "THE DISTRICT AND IMPROVEMENT AREA NO. 1" and "PROPERTY OWNERSHIP AND DEVELOPMENT STATUS."
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Appraisal. An appraisal of the property within Improvement Area No. 1 of the District dated June 10, 2026 (the "Appraisal"), was prepared by BBG, Inc., Sacramento, California (the "Appraiser") in connection with the issuance of the 2026 Bonds. The purpose of the Appraisal was to estimate the fee simple market value of the properties within Improvement Area No. 1 by ownership, subject to the lien of the Facilities Special Tax, with the sum of values by ownership representing an aggregate value, as of a June 1, 2026 date of value. Subject to the assumptions and limiting conditions contained in the Appraisal, the Appraiser estimated that the taxable property within Improvement Area No. 1, as of the June 1, 2026, date of value, had the following estimated not -less -than market values:

Neighborhoods Property Ownership
R & O Lennar Homes
Individual homeowners
L & K-1 Tri Pointe
Individual homeowners
Century Communities
Individual homeowners
A/B K. Hovnanian (1)
C KB
Various Master Developer
Totals:

Number
of Lots Estimated Value
52 $21,400,000 (2)
79 53,825,000
33 10,620,000
7 5,040,000
61 13,310,000
8 5,280,000
67 13,400,000
85 15,130,000
540 65,800,000 (2)
932 $203,805,000 (3)
(1) All of these lots are currently held by the K. Hovnanian Land Bank. (2) Represents not -less than market value in bulk.
(3) Represents not -less than aggregate value.

Source: The Appraisal.

See "THE DISTRICT AND IMPROVEMENT AREA NO. 1 — Appraised Values" and "APPENDIX I" for further information on the Appraisal.

Risk Factors Associated with Purchasing the 2026 Bonds. Investment in the 2026 Bonds involves a significant degree of risk and each prospective investor should consider its financial condition and the risks involved to determine the suitability of investing in the 2026 Bonds. See "BOND OWNERS' RISKS" for a discussion of certain risk factors which should be considered, in addition to the other matters set forth in this Official Statement, in considering the investment quality of the 2026 Bonds.
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FINANCING PLAN
Facilities Financing Plan
The net proceeds of the 2026 Bonds will be used to construct or acquire various facilities authorized to be financed by the District. The City anticipates that the 2026 Bond proceeds will provide approximately $ million to finance authorized facilities. See "THE DISTRICT AND IMPROVEMENT AREA NO. 1 — Authorized Facilities" for a description of the authorized facilities.

For the current status of the construction of Facilities in Improvement Area No. 1 to be financed in part with the net proceeds of the 2026 Bonds, see "PROPERTY OWNERSHIP AND DEVELOPMENT STATUS — Public Infrastructure Improvements Required for the One Lake Project."
Estimated Sources and Uses of Funds
The estimated proceeds from the sale of the 2026 Bonds will be deposited into the following funds established under the Fiscal Agent Agreement:

SOURCES
Principal Amount of 2026 Bonds
Plus: Original Issue Premium
Less: Underwriter's Discount
Total Sources
USES
Deposit into Capitalized Interest Account')
Deposit into Bond Proceeds Account of Improvement Fund
Deposit into 2024 Reserve Fund(2)
Deposit into Costs of Issuance Fund(')
Total Uses
Amount
(1) To fund partial capitalized interest on the 2026 Bonds through March 1, 2027, (2) Represents the amount required to be deposited in the 2024 Reserve Fund to satisfy the 2024 Reserve Requirement on the Closing Date.
(3) Includes, among other things, the fees and expenses of Bond Counsel and Disclosure Counsel, costs of printing the preliminary and final Official Statements, and the fees and expenses of the Fiscal Agent, the Municipal Advisor, the Appraiser, and the Special Tax Consultant.
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THE 2026 BONDS
This section generally describes the terms of the 2026 Bonds contained in the Fiscal Agent Agreement, which is summarized in more detail in APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT. Capitalized terms used but not defined in this section are defined in APPENDIX C — SUMMARY OF CERTAIN PROVISIONS OF THE FISCAL AGENT AGREEMENT.

Authority for Issuance
The 2026 Bonds are issued under the Act, the Resolution of Issuance and the Fiscal Agent Agreement. Under the Resolution of Issuance, the 2026 Bonds may be issued in a maximum principal amount of $[ I.

General Bond Terms
Dated Date, Maturity and Authorized Denominations. The 2026 Bonds will be dated their date of delivery (the "Dated Date"), which is the Closing Date, and will mature in the amounts and on the dates set forth on the inside cover page of this Official Statement. The 2026 Bonds will be issued in fully registered form in the Authorized Denomination of $5,000 or any integral multiple thereof.

Calculation of Interest. Interest will be calculated on the basis of a 360-day year composed of twelve 30-day months. The 2026 Bonds will bear interest at the annual rates set forth on the inside cover page of this Official Statement, payable semiannually on each March 1 and September 1, commencing March 1, 2027 (each, an "Interest Payment Date").

Each 2026 Bond shall bear interest from the Interest Payment Date next preceding the date of authentication thereof unless
(i) it is authenticated on an Interest Payment Date, in which event it shall bear interest from such date of authentication, or
(ii) it is authenticated prior to an Interest Payment Date and after the close of business on the Record Date preceding such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or (iii) it is authenticated on or before the Record Date preceding the first Interest Payment Date, in which event it shall bear interest from the Dated Date; provided, however, that if at the time of authentication of a 2026 Bond, interest is in default thereon, such 2026 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment thereon. "Record Date" means the 15th day of the calendar month next preceding the applicable Interest Payment Date, whether or not such day is a Business Day.

DTC and Book -Entry Only System. DTC will act as securities depository for the 2026 Bonds. The 2026 Bonds will be issued as fully -registered securities registered initially in the name of Cede & Co. (DTC's partnership nominee). See "— Registration of Exchange or Transfer" below for a description of such release test, and "APPENDIX D — DTC AND THE BOOK -ENTRY ONLY SYSTEM" for a description of DTC and DTC's book -entry system. -8-

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Payments of Interest and Principal. For so long as DTC is used as depository for the 2026 Bonds, principal of, premium, if any, and interest payments on the 2026 Bonds will be made solely to DTC or its nominee, Cede & Co., as registered owner of the 2026 Bonds, for distribution to the beneficial owners of the 2026 Bonds in accordance with the procedures adopted by DTC.

Interest on the 2026 Bonds (including the final interest payment upon maturity or earlier redemption), is payable on the applicable Interest Payment Date by check of the Fiscal Agent mailed by first class mail to the registered Owner thereof at such registered Owner's address as it appears on the registration books maintained by the Fiscal Agent at the close of business on the Record Date preceding the Interest Payment Date, or by wire transfer to an account located in the United States of America made on such Interest Payment Date upon written instructions of any Owner of $1,000,000 or more in aggregate principal amount of 2026 Bonds delivered to the Fiscal Agent prior to the applicable Record Date, which will continue in effect until revoked in writing, or until such 2026 Bonds are transferred to a new Owner.

The principal of and any premium on the 2026 Bonds are payable in lawful money of the United States of America, with principal and any premium payable upon surrender of the 2026 Bonds at the Principal Office of the Fiscal Agent.

Redemption`
Optional Redemption. The 2026 Bonds maturing on or before September 1, 20_, are not subject to optional redemption prior to their stated maturity. The 2026 Bonds maturing on or after September 1, 20_, are subject to redemption, as a whole or in part at the election of the City among maturities on such basis as designated by the City and by lot within a maturity, at the option of the City, on September 1, 20_, and on any date thereafter, at a redemption price equal to 100% of the principal amount of 2026 Bonds to be redeemed, together with accrued interest thereon to the date fixed for redemption, without premium.

Mandatory Sinking Fund Redemption. The 2026 Bonds maturing on September 1, 20 and September 1, 20_ (the "Term Bonds"), are subject to mandatory redemption in part by lot, from sinking fund payments made by the City from the Bond Fund, at a redemption price equal to the principal amount thereof to be redeemed, plus accrued interest to the redemption date, without premium, in the aggregate respective principal amounts all as set forth in the following tables:
2026 Bonds Maturing September 1, 20
Sinking Fund
Redemption Date
(September 1) Sinking Payments
(Maturity)
* Preliminary; subject to change.
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2026 Bonds Maturing September 1, 20_
Sinking Fund
Redemption Date
(September 1) Sinkinq Payments
(Maturity)
Provided, however, if some but not all of the Term Bonds of a given maturity have been redeemed through optional redemption or mandatory prepayment redemption, the total amount of all future Sinking Fund Payments relating to such maturity will be reduced by the aggregate principal amount of Term Bonds of such maturity so redeemed, to be allocated among such Sinking Fund Payments on a pro rata basis in integral multiples of $5,000 as determined by the City, notice of which will be given by the City to the Fiscal Agent.

Redemption from Special Tax Prepayments. Special Tax Prepayments and any corresponding transfers from the 2024 Reserve Fund under the Fiscal Agent Agreement will be used to redeem 2026 Bonds on the next Interest Payment Date for which notice of redemption can timely be given under the Fiscal Agent Agreement, among series and maturities as provided in the Fiscal Agent Agreement, at a redemption price (expressed as a percentage of the principal amount of the 2026 Bonds to be redeemed), as set forth below, together with accrued interest to the date fixed for redemption:

Redemption Dates Redemption Price
Any Interest Payment Date on or before March 1,
September 1, and March 1,
September 1, and March 1,
September 1, and any Interest Payment Date thereafter
Purchase in Lieu of Redemption. In lieu of redemption under the Fiscal Agent Agreement, moneys in the Bond Fund may be used and withdrawn by the Fiscal Agent for purchase of 2026 Bonds, upon the filing with the Fiscal Agent of an Officer's Certificate requesting such purchase, at public or private sale as and when, and at such prices (including brokerage and other charges) as such Officer's Certificate may provide, but in no event may 2026 Bonds be purchased at a price in excess of the principal amount thereof, plus interest accrued to the date of purchase and any premium which would otherwise be due if such 2026 Bonds were to be redeemed in accordance with the Fiscal Agent Agreement. Any 2026 Bonds purchased pursuant to this provision of the Fiscal Agent Agreement will be treated as outstanding 2026 Bonds under the Fiscal Agent Agreement, except to the extent otherwise directed by the Finance Director.

Notice of Redemption. The Fiscal Agent will cause notice of any redemption to be mailed by first-class mail, postage prepaid, at least 20 days but not more than 60 days prior to the date fixed for redemption, to the Securities Depositories, and to the respective registered Owners of any 2026 Bonds designated for redemption, at their addresses appearing on the registration books in the Principal Office of the Fiscal Agent; but such mailing will not be a condition precedent to such redemption and failure to mail or to receive any such notice, or any defect therein, will not affect the validity of the proceedings for the redemption of such 2026 Bonds. In addition, the Fiscal Agent will file each notice of redemption with the MSRB through its EMMA system. The sole remedy for failure to file such notices through EMMA shall be an action by the holders of the Bonds in mandamus for specific performance or a similar remedy to compel performance. -10-

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However, while the 2026 Bonds are subject to DTC's book -entry system, the Fiscal Agent will be required to give notice of redemption only to DTC as provided in the letter of representations executed by the City and received and accepted by DTC. DTC and the Participants will have sole responsibility for providing any such notice of redemption to the Beneficial Owners of the 2026 Bonds to be redeemed. Any failure of DTC to notify any Participant, or any failure of Participants to notify the Beneficial Owner of any 2026 Bonds to be redeemed, of a notice of redemption or its content or effect will not affect the validity of the notice of redemption, or alter the effect of redemption set forth in the Fiscal Agent Agreement.

Conditional Redemption Notice; Rescission of Redemption. Notices of optional redemption may be conditional. The City has the right to rescind any notice of the optional redemption of 2026 Bonds by written notice to the Fiscal Agent on or prior to the date fixed for redemption. Any notice of redemption will be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the 2026 Bonds then called for redemption, and such cancellation will not constitute a default under the Fiscal Agent Agreement.

The City and the Fiscal Agent have no liability to the Owners or any other party related to or arising from such rescission of redemption. The Fiscal Agent will mail notice of such rescission of redemption in the same manner as the original notice of redemption was sent under the Fiscal Agent Agreement.

Partial Redemption. Whenever provision is made in the Fiscal Agent Agreement for the redemption of less than all the Bonds of any maturity or any given portion thereof, unless otherwise directed by the City, the Fiscal Agent will select the Bonds to be redeemed from all Bonds or such given portion thereof not previously called for redemption as directed by the City or, in the absence of direction by the City, on a pro rata basis, among series and maturities, and, so as to maintain substantially the same Debt Service profile for the Bonds as in effect prior to such redemption, and by lot within a maturity, in any manner which the Fiscal Agent in its sole discretion deems appropriate.

Effect of Redemption. From and after the date fixed for redemption, if funds available for the payment of the principal of, and interest and any premium on, the 2026 Bonds so called for redemption shall have been deposited in the Bond Fund, such 2026 Bonds so called shall cease to be entitled to any benefit under the Fiscal Agent Agreement other than the right to receive payment of the redemption price, and no interest shall accrue thereon on or after the redemption date specified in the notice of redemption.

Issuance of Future Parity Bonds
Bonded Indebtedness Limit. As a result of the issuance of the 2024 Bonds ($36,500,000 initial principal amount), the remaining unissued amount of authorized bonded indebtedness of District has decreased from $100,000,000 to $63,500,000. As a result of the issuance of the 2026 Bonds, the remaining unissued amount of authorized bonded indebtedness of the District has further decreased to $
Parity Bonds. In addition to the 2026 Bonds and the 2024 Bonds, but subject to the maximum bonded indebtedness limit for Improvement Area No. 1, the City may issue one or more additional series of bonds or other indebtedness (collectively, "Parity Bonds") payable from the Special Tax Revenues on a parity with the 2026 Bonds and the 2024 Bonds, in such principal amount as may be determined by the City, under a Supplemental Agreement entered into by the City and the Fiscal Agent. Any such Parity Bonds will constitute Bonds under the Fiscal Agent -11-

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Agreement and will be secured by a lien on the Special Tax Revenues and funds pledged for the payment of the 2026 Bonds and the 2024 Bonds under the Fiscal Agent Agreement on a parity with all other Bonds Outstanding thereunder, except as provided in the Fiscal Agent Agreement or in a Supplemental Agreement.

The City may issue such Parity Bonds if the City complies with the following conditions precedent set forth in the Fiscal Agent Agreement:
(A) Compliance. Following issuance of the Parity Bonds, the City must be in compliance with all covenants set forth in the Fiscal Agent Agreement and all Supplemental Agreements, and issuance of the Parity Bonds may not cause the City to exceed the bonded indebtedness limit of Improvement Area No. 1. (B) Same Payment Dates. The Supplemental Agreement providing for the issuance of such Parity Bonds must provide that interest thereon will be payable on the Interest Payment Dates, and principal thereof will be payable on the same date in any year in which principal is payable on the 2026 Bonds (provided that there shall be no requirement that any Parity Bonds pay interest on a current basis). (C) Separate Funds; Debt Service Reserve Fund. The Supplemental Agreement providing for the issuance of such Parity Bonds may provide for the establishment of separate funds and accounts.

The Supplemental Agreement providing for issuance of the Parity Bonds will provide for one of the following: (i) a deposit to the 2024 Reserve Fund in an amount necessary such that the amount deposited therein shall equal the 2024 Reserve Requirement following issuance of the Parity Bonds, (ii) a deposit to a reserve account for the Parity Bonds (and such other series of Parity Bonds identified by the City) in an amount defined in such Supplemental Agreement, as long as such Supplemental Agreement expressly declares that the Owners of such Parity Bonds will have no interest in or claim to the 2024 Reserve Fund and that the Owners of the Bonds covered by the 2024 Reserve Fund will have no interest in or claim to such other reserve account or (iii) no deposit to either the 2024 Reserve Fund or another reserve account as long as such Supplemental Agreement expressly declares that the Owners of such Parity Bonds will have no interest in or claim to the 2024 Reserve Fund or any other reserve account. (D) Improvement Area No. 1 Value. The Improvement Area No. 1 Value must be at least three times the sum of: (i) the aggregate principal amount of all Bonds then Outstanding, plus (ii) the aggregate principal amount of the series of Parity Bonds proposed to be issued, plus (iii) the aggregate principal amount of any fixed assessment liens on the parcels in Improvement Area No. 1 subject to the levy of Special Taxes, plus (iv) a portion of the aggregate principal amount of any and all other community facilities district bonds then outstanding and payable at least partially from special taxes to be levied on parcels of land within Improvement Area No. 1 (the "Other District Bonds") equal to the aggregate principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on parcels of land within Improvement Area No. 1, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of land against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum assigned special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year. -12-

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(E) Unimproved Property Value. The Unimproved Property Value must be at least three times the sum of: (i) the proportionate share of the amounts described in clauses (i) and (ii) of the preceding subsection (D) determined by multiplying the aggregate of the amounts described in such clauses (i) and (ii) by a fraction, the numerator of which is the amount of Special Taxes to be levied on Unimproved Property in the Fiscal Year following the then current Fiscal Year (without regard to any capitalized interest for any Parity Bonds), and the denominator of which is the total amount of Special Taxes to be levied on property in Improvement Area No. 1 in the Fiscal Year following the then current Fiscal Year, based upon information from the most recent available Fiscal Year, plus (ii) the aggregate principal amount of any fixed assessment liens on the Unimproved Property, plus (iii) a portion of the aggregate principal amount of any Other District Bonds (as defined in the preceding subsection (D)) equal to the aggregate principal amount of the Other District Bonds multiplied by a fraction, the numerator of which is the amount of special taxes levied for the Other District Bonds on Unimproved Property, and the denominator of which is the total amount of special taxes levied for the Other District Bonds on all parcels of real property against which the special taxes are levied to pay the Other District Bonds (such fraction to be determined based upon the maximum assigned special taxes which could be levied in the year in which maximum annual debt service on the Other District Bonds occurs), based upon information from the most recent available Fiscal Year. If 100% of the debt service on the Bonds after the issuance of the proposed Parity Bonds is expected to be derived from Special Taxes levied on Developed Property, then the provisions of this subsection (E) will not apply to the proposed issuance of Parity Bonds.

For purposes of this test, "Unimproved Property" is defined as the property in Improvement Area No. 1 subject to the levy of the Special Taxes that is classified as Undeveloped Property or Final Map Property pursuant to the Rate and Method. (F) Coverage. The amount of the maximum Special Taxes that may be levied in each Fiscal Year under the Ordinance, the Agreement and any Supplemental Agreement must be no lower than (i) 110% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Parity Bonds and (ii) 100% of the total Annual Debt Service of the then Outstanding Bonds and the proposed Parity Bonds and the amount of the levy for Administrative Expenses in the current fiscal year. In addition, the aggregate Special Tax Prepayments that could occur after the issuance of the Parity Bonds must be not less than the principal amount of the Outstanding Bonds and the proposed Parity Bonds.
(G) Certificates. The City must deliver to the Fiscal Agent an Officer's Certificate certifying that the conditions precedent to the issuance of such Parity Bonds set forth in subsections (A), (B), (C), (D), (E), and (F) above have been satisfied.

Limitation on Principal Amount of Parity Bonds. Pursuant to the Fiscal Agent Agreement, the City will covenant, following issuance of the 2026 Bonds, not to issue more than $U` initial principal amount of Parity Bonds (exclusive of any Refunding Bonds). See "THE DISTRICT AND IMPROVEMENT AREA NO. 1 — Formation and Background." Refunding Bonds. Notwithstanding the foregoing, the City may issue Refunding Bonds as Parity Bonds without the need to satisfy the requirements of clauses (D), (E), or (F) above, and, in connection therewith, the Officer's Certificate in clause (G) above need not make reference to said clauses (D), (E), and (F).
* Preliminary; subject to change.
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Under the Fiscal Agent Agreement, the term "Refunding Bonds" is defined as bonds issued by the City with respect to Improvement Area No. 1, the net proceeds of which are used to refund all or a portion of the then -Outstanding Bonds; provided that the principal and interest on the Refunding Bonds to their final maturity date is less than the principal and interest on the Bonds being refunded to their final maturity date, and the final maturity of the Refunding Bonds is not later than the final maturity of the Bonds being refunded.

Subordinate Bonds. Nothing in the Fiscal Agent Agreement prohibits the City from issuing any other bonds or otherwise incurring debt secured by a pledge of the Special Tax Revenues subordinate to the pledge thereof under the Fiscal Agent Agreement.

Registration, Transfer and Exchange
The following provisions regarding the exchange and transfer of the 2026 Bonds apply only during any period in which the 2026 Bonds are not subject to DTC's book -entry system.

While the 2026 Bonds are subject to DTC's book -entry system, their exchange and transfer will be effected through DTC and the Participants and will be subject to the procedures, rules and requirements established by DTC. See 'APPENDIX D — DTC AND THE BOOK -ENTRY ONLY SYSTEM."
Registration. The Fiscal Agent will keep, or cause to be kept, at its Principal Office sufficient books for the registration and transfer of the 2026 Bonds, which will show the series number, date, amount, rate of interest and last known owner of each 2026 Bond and will at all times be open to inspection by the City during regular business hours upon reasonable notice; and, upon presentation for such purpose, the Fiscal Agent will, under such reasonable regulations as it may prescribe, register or transfer or cause to be registered or transferred, on said books, the ownership of the 2026 Bonds as provided in the Fiscal Agent Agreement. The City and the Fiscal Agent will treat the Owner of any 2026 Bond whose name appears on the Bond register as the absolute Owner of such 2026 Bond for any and all purposes, and the City and the Fiscal Agent will not be affected by any notice to the contrary. The City and the Fiscal Agent may rely on the address of the Owner as it appears in the Bond register for any and all purposes.

Registration of Exchange or Transfer. Any 2026 Bond may, in accordance with its terms, be transferred, upon the Bond register by the person in whose name it is registered, in person or by such person's duly authorized attorney, upon surrender of such 2026 Bond for cancellation, accompanied by delivery of a duly written instrument of transfer in a form acceptable to the Fiscal Agent. 2026 Bonds may be exchanged at the Principal Office of the Fiscal Agent solely for a like aggregate principal amount of 2026 Bonds of authorized denominations and of the same maturity. The cost for any services rendered or any expenses incurred by the Fiscal Agent in connection with any such transfer or exchange will be paid by the City from amounts in the Administrative Expense Fund. The Fiscal Agent will collect from the Owner requesting such transfer or exchange any tax or other governmental charge required to be paid with respect to such transfer or exchange. Whenever any 2026 Bonds are surrendered for transfer or exchange, the City will execute and the Fiscal Agent will authenticate and deliver new 2026 Bonds for a like aggregate principal amount.

No transfers or exchanges of 2026 Bonds will be required to be made (i) 15 days prior to the date established by the Fiscal Agent for selection of 2026 Bonds for redemption or (ii) with respect to a 2026 Bond after such 2026 Bond has been selected for redemption; or (iii) between a Record Date and the succeeding Interest Payment Date. Prior to any transfer of the 2026 Bonds outside the book -entry system (including, but not limited to, the initial transfer outside the book - entry system) the transferor shall provide or cause to be provided to the Fiscal Agent all -14-

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information necessary to allow the Fiscal Agent to comply with any applicable tax reporting obligations, including without limitation any cost basis reporting obligations under Internal Revenue Code Section 6045, as amended. The Fiscal Agent shall conclusively rely on the information provided to it and shall have no responsibility to verify or ensure the accuracy of such information.
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DEBT SERVICE SCHEDULE
The following table presents the annual Debt Service on the 2026 Bonds, assuming there are no optional redemptions or special redemptions from Facilities Special Tax prepayments.

Year Ending
September 1
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
2036
2037
2038
2039
2040
2041
2042
2043
2044
2045
2046
2047
2048
2049
2050
2051
2052
2053
2054
2055
2056
Total:
2024 Bonds 2026 Bonds 2026 Bonds 2026 Bonds
Total Principal Interest ril Total Total
(1) A portion of the interest on the 2026 Bonds due on March 1, 2027, is anticipated to be paid from proceeds of the 2026 Bonds to be deposited in the Capitalized Interest Account. -16-

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SECURITY FOR THE BONDS
This section generally describes the security for the Bonds set forth in the Fiscal Agent Agreement, which is summarized in more detail in APPENDIX C. Capitalized terms used but not defined in the section are defined in APPENDIX C.

General
The 2026 Bonds, the 2024 Bonds and any Parity Bonds (collectively, the "Bonds") are secured by a first pledge (which will be effected in the manner and to the extent provided in the Fiscal Agent Agreement) of all of the Special Tax Revenues and all moneys deposited in the Bond Fund (including the Special Tax Prepayments Account and Capitalized Interest Account therein), and, until disbursed as provided therein, in the Special Tax Fund.

The Special Tax Revenues and all moneys deposited into such funds (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose under the Fiscal Agent Agreement.

The 2026 Bonds, the 2024 Bonds and all future 2024-Related Parity Bonds will be secured by a first pledge (which will be effected in the manner and to the extent provided in the Fiscal Agent Agreement) of all moneys deposited in the 2024 Reserve Fund. The moneys in the 2024 Reserve Fund (except as otherwise provided in the Fiscal Agent Agreement) are dedicated to the payment of the principal of, and interest and any premium on, the 2026 Bonds, the 2024 Bonds and all future 2024-Related Parity Bonds as provided in the Fiscal Agent Agreement and in the Act until all of the 2026 Bonds, the 2024 Bonds and all future 2024-Related Parity Bonds have been paid and retired or until moneys or Federal Securities have been set aside irrevocably for that purpose under the Fiscal Agent Agreement.

Under the Fiscal Agent Agreement, "2024-Related Parity Bonds" means any series of Parity Bonds for which (i) the proceeds are deposited into the 2024 Reserve Fund so that the balance therein is equal to the 2024 Reserve Requirement following issuance of such Parity Bonds and (ii) the related Supplemental Agreement specifies that the 2024 Reserve Fund shall act as a reserve for the payment of the principal of, and interest and any premium on, such series of Parity Bonds. The 2026 Bonds constitute "2024-Related Parity Bonds" under the Fiscal Agent Agreement and are secured on a parity basis with the 2024 Bonds by a first pledge of all moneys deposited in the 2024 Reserve Fund.

Amounts in the Improvement Fund (and all subaccounts therein), the Administrative Expense Fund and the Costs of Issuance Fund are not pledged to the repayment of the Bonds.

The facilities being financed with the proceeds of the 2026 Bonds are not pledged to the repayment of the Bonds, nor are the proceeds of any condemnation or insurance award received by the City with respect to the facilities being financed with the proceeds of the 2026 Bonds. "Special Tax Revenues" are defined in the Fiscal Agent Agreement as the proceeds of the Facilities Special Taxes received by the City, including any scheduled payments thereof and any Facilities Special Tax Prepayments, interest thereon and proceeds of the redemption or sale of property sold as a result of foreclosure of the lien of the Facilities Special Taxes to the amount of said lien and interest thereon. However, Special Tax Revenues do not include any interest in excess of the interest due on the Bonds, or any penalties collected in connection with any such foreclosure.
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Limited Obligation
The 2026 Bonds, the interest thereon, and any premiums payable on the redemption of any of the 2026 Bonds, are not an indebtedness of the City (except to the limited extent described in this Official Statement), the State or any of its political subdivisions, and neither the City (except to the limited extent described in this Official Statement), the State nor any of its political subdivisions is liable on the 2026 Bonds. Neither the faith and credit nor the taxing power of the City (except to the limited extent described in this Official Statement) or the State or any political subdivision thereof is pledged to the payment of the 2026 Bonds or interest thereon. Other than the Facilities Special Taxes, no taxes are pledged to the payment of the 2026 Bonds. The 2026 Bonds are not a general obligation of the City, but are limited obligations of the City payable solely from the Special Tax Revenues as more fully described in this Official Statement.

Facilities Special Taxes
Covenant to Levy Facilities Special Taxes. Under the Fiscal Agent Agreement, the Finance Director will fix and levy the amount of Facilities Special Taxes within Improvement Area No. 1 required for the payment of principal of and interest on any outstanding Bonds of the District with respect to Improvement Area No. 1 becoming due and payable during the ensuing calendar year, including any necessary replenishment or expenditure of the 2024 Reserve Fund and any other reserve account for Parity Bonds that are not 2024-Related Parity Bonds, and an amount estimated to be sufficient to pay the Administrative Expenses, including amounts necessary to discharge any rebate obligation, during such year, taking into account the balances in the applicable funds established under the Fiscal Agent Agreement and funds in the Special Tax Fund. The Facilities Special Taxes so levied may not exceed the authorized amounts as provided in the proceedings under the Resolution of Formation.

Manner of Collection. Except as set forth in the Ordinance, the Fiscal Agent Agreement provides that the Facilities Special Taxes will be payable and be collected in the same manner and at the same time and in the same installment as the general taxes on real property are payable, and have the same priority, become delinquent at the same time and in the same proportionate amounts and bear the same proportionate penalties and interest after delinquency as do the ad valorem taxes on real property. The City is authorized to employ consultants to assist in computing the levy of the Facilities Special Taxes under the Fiscal Agent Agreement and any reconciliation of amounts levied to amounts received. The fees and expenses of such consultants and the costs and expenses of the City (including a charge for staff time) in conducting its duties under the Fiscal Agent Agreement will be an Administrative Expense.

Because the Facilities Special Tax levy is limited to the maximum Facilities Special Tax rates set forth in the Amended Rate and Method, no assurance can be given that, in the event of Facilities Special Tax delinquencies, the receipts of Facilities Special Taxes will, in fact, be collected in sufficient amounts in any given year to pay Debt Service on the Bonds. Further, under no circumstances will the Facilities Special Tax levied against any parcel of residential property for which an occupancy permit for private residential use has been issued be increased by more than 10% as a consequence of delinquency or default by the owner of any other parcel within the District. In addition, in no event shall Facilities Special Taxes be levied after the earlier of (i) the Fiscal Year prior to the Transition Year (as hereinafter defined) or (ii) Fiscal Year 2073-74. See "BOND OWNERS' RISKS — Property Tax Delinquencies. "
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Fairfield City CouncilJuly 7, 2026

Fairfield City Council
July 7, 2026