Fontana Southridge- City Parcel PSA — Fontana City Council, June 14, 2022

16498.00100\40032432.6

PURCHASE AND SALE AGREEMENT

AND JOINT ESCROW INSTRUCTIONS
DATED
______________, 20__

BY AND BETWEEN

CITY OF FONTANA,
a municipal corporation

AS SELLER,

NH SOUTHRIDGE LLC,
a California limited liability company,

AS BUYER

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TABLE OF CONTENTS
Page

1. PURCHASE AND SALE. ...................................................................................................1

2. PURCHASE PRICE. ...........................................................................................................1

2.1 Deposits ..................................................................................................................1

2.2 Deposit of Balance .................................................................................................2

3. ESCROW. ............................................................................................................................2

3.1 Opening of Escrow ................................................................................................2

3.2 Escrow Instructions ................................................................................................2

3.3 Termination/Cancellation ......................................................................................3

4. ACTIONS PENDING CLOSING. ......................................................................................3

4.1 Due Diligence. .......................................................................................................3

4.2 Title. .......................................................................................................................6

4.3 Development Entitlements ....................................................................................6

5. DESCRIPTION OF PROPERTY. .......................................................................................7

5.1 The Real Property ..................................................................................................7

6. CONDITIONS TO CLOSING. ...........................................................................................7

6.1 Buyer’s Closing Conditions ...................................................................................7

6.2 Seller's Closing Conditions ....................................................................................8

7. CLOSING. ...........................................................................................................................8

7.1 Closing Date ...........................................................................................................8

7.2 Deliveries by Seller ................................................................................................8

7.3 Deliveries by Buyer ...............................................................................................9

7.4 Actions by Escrow Agent ......................................................................................9

7.5 Prorations/Apportionment ....................................................................................10

7.6 Closing Costs .......................................................................................................11

7.7 Closing Statement ................................................................................................11

7.8 Deliveries Outside of Escrow ..............................................................................11

8. SELLER’S REPRESENTATIONS AND WARRANTIES. .............................................12

8.1 Due Organization .................................................................................................12

8.2 Seller’s Authority; Validity of Agreements .........................................................12

8.3 No Third-Party Rights ..........................................................................................12 16498.00100\40032432.6

8.4 Litigation ..............................................................................................................12

8.5 Zoning and Condemnation ...................................................................................12

8.6 No Violations of Environmental Laws ................................................................12

8.7 No Other Commitments .......................................................................................13

8.8 Wells ....................................................................................................................13

9. BUYER’S REPRESENTATIONS AND WARRANTIES. ..............................................14

9.1 Due Organization .................................................................................................14

9.2 Buyer’s Authority; Validity of Agreements.........................................................14

10. SURVIVAL. ......................................................................................................................14

11. AS-IS..................................................................................................................................14

12. RISK OF LOSS..................................................................................................................15

12.1 Condemnation ......................................................................................................15

12.2 Casualty ................................................................................................................15

13. REMEDIES........................................................................................................................16

13.1 Default by Seller ..................................................................................................16

13.2 Default by Buyer ..................................................................................................16

14. BROKERS .........................................................................................................................17

15. MISCELLANEOUS PROVISIONS. .................................................................................17

15.1 Entire Agreement .................................................................................................17

15.2 Modification; Waiver ...........................................................................................17

15.3 Notices .................................................................................................................17

15.4 Expenses ..............................................................................................................18

15.5 Severability ..........................................................................................................19

15.6 Successors and Assigns ........................................................................................19

15.7 Counterparts .........................................................................................................19

15.8 Governing Law; Jurisdiction; ..............................................................................19

15.9 Headings ..............................................................................................................19

15.10 Time of Essence ...................................................................................................19

15.11 Further Assurances ...............................................................................................19

15.12 Construction .........................................................................................................20

15.13 Attorneys’ Fees ....................................................................................................20

15.14 Business Days ......................................................................................................20

16498.00100\40032432.6

1 PURCHASE AND SALE AGREEMENT

AND JOINT ESCROW INSTRUCTIONS

THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this "Agreement") is made and entered this ____ day of _______, 20__, (the "Effective Date"), by and between CITY OF FONTANA, a municipal corporation ("Seller"), and NH SOUTHRIDGE LLC, a California limited liability company ("Buyer "), for the purpose of setting forth the agreement of the parties and to provide instructions to Escrow Agent with respect to the transaction contemplated by this Agreement. Seller and Buyer are sometimes individually referred to herein as a "Party" and, together, as the "Parties."

RECITALS
This Agreement is entered into with reference to the following recitals of fact (“Recitals”) that Seller and Buyer believe to be true as of the Effective Date of this Agreement:

A. Seller is the owner of an undivided fee simple interest in certain real property located in the City of Fontana ("City"), San Bernardino County (" County"), State of California, known as County of San Bernardino Assessor Parcel Number 0237-411-13, and as more particularly described on Exhibit "A " attached hereto (the "Land"). The Land, together with any Improvements (as defined in Section 5), are referred to in this Agreement as the "Property." B. Buyer is the owner of the adjacent parcel of land [APN: 0237-411- 14] (“Buyer’s Parcel”).

C. Seller desires to sell, transfer, and convey the Property to Buyer, and Buyer desires to purchase and acquire the Property from Seller, upon and subject to the terms and conditions set forth in this Agreement.

AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants contained in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Buyer and Seller hereby agree, and instruct Escrow Agent, as follows:

1. PURCHASE AND SALE.

Subject to and upon all of the terms and conditions of this Agreement, Seller agrees to sell, transfer, and convey to Buyer, and Buyer agrees to purchase and acquire from Seller, the Property.

2. PURCHASE PRICE.

The purchase price of the Property (the "Purchase Price") shall be One Million Five Hundred Twenty Five Thousand Dollars ($1,525,000.00). The Purchase Price shall be payable as follows:

2.1 Deposit . Within one (1) day following the "Opening of Escrow" (as hereinafter defined), Buyer shall deposit into "Escrow" (as hereinafter defined) the sum of Twenty -Five 16498.00100\40032432.6

2 Thousand Dollars ($25,000) (which amount, together with any and all interest earned thereon, shall hereinafter be referred to as the " Deposit"). The Deposit shall be fully refundable to Buyer for whatever reason from the Opening of Escrow through the end of the Due Diligence Period (the “Deposit Period”). Thereafter, the Deposit shall become non- refundable, except as specifically provided otherwise herein, and shall be credited against the Purchase Price at Closing.

2.1.1 Refund of Deposit. In the event that Buyer delivers its Feasibil ity Notice, but subsequently elects to terminate this Agreement due to (a) a Seller Default, as defined in Section 12.1 hereunder, (b) a failure of a Buyer’s Condition to Closing, or (c) the occurrence of any other event which by the terms of this Agreement gives rise to Buyer’s right to terminate this Agreement and receive a refund of the Deposit, then, subject to the terms of Section 12.1, (i) the Deposit shall be returned by Escrow Agent to Buyer, or to the extent previously released to Seller, and refunded to Buyer by Seller, (ii) this Agreement and the Escrow shall terminate, and (iii) the Parties shall have no further obligation to one another with respect to this Agreement, except with respect to such provisions which by their terms survive the termination of this Agreement.

2.1.2 In
terest . The Deposit and any other cash held by Escrow Agent for the benefit of Buyer shall be held in a federally insured account, with any account set up charges borne by Buyer.

2.2 D ep osit of Balance. Buyer shall, at least one (1) business day prior to Closing (as defined in Section 7.1), deposit into Escrow in the form of wire transfer, cash or a certified or bank cashier’s check for immediately available funds, the amount of the Purchase Price less the Deposit, plus Buyer's closing costs and Buyer's share of any prorations to be made in accordance with this Agreement.

3. ESCROW.

3.1 Opening of Escrow . Buyer and Seller shall cause an escrow (" Escrow") to be opened with Fidelity National Title Insurance Company at 3237 E. Gausti Road, Suite 105, Ontario, CA 91761, Attention: Mary Lou Adame , Escrow Officer ("Escrow Agent") by delivery to Escrow Agent of a fully executed copy of this Agreement. Escrow Agent shall promptly deliver to Buyer and Seller written notice of the date of the “Opening of Escrow.” As used herein, the term "Opening of Escrow" means the day on which Escrow Agent receives a fully executed copy of this Agreement and has notified each Party in writing of such receipt.

3.2 Escrow Instructions . This Agreement shall constitute escrow instructions to Escrow Agent as well as the agreement of the Parties. In the event that any other printed escrow instructions are requested of the Parties and the terms thereof conflict or are inconsistent with any provision of this Agreement or any deed, instrument, or document executed or delivered in connection with the transaction contemplated hereby, the provisions of this Agreement, or such deed, instrument, or document shall control. Escrow Agent is hereby appointed and designated to act as Escrow Agent and instructed to deliver, pursuant to the terms of this Agreement, the documents and funds to be deposited into Escrow as herein provided.

3.3 T
ermination/Cancellation . Upon any termination or cancellation (the terms being used interchangeably herein) by either of the Parties as expressly allowed under this Agreement (including, without limitation, any deemed termination or cancellation), (a) the Deposit shall be 16498.00100\40032432.6

3 delivered to the Party that t his Agreement specifies is entitled thereto; (b) all documents, instruments, and funds delivered into Escrow shall be returned to the Party that delivered the same into Escrow, and (c) the Parties shall thereafter be relieved from further liability hereunder, except with respect to any obligations under this Agreement that are expressly stated to survive any termination of this Agreement. A copy of any notice of termination allowed under this Agreement shall be sent to Escrow Agent by the Party electing to terminate. Upon a termination or cancellation by either of the Parties for any reason other than a default by Seller, Buyer shall deliver to Seller copies of all third-party reports, plans, studies, applications or any other matters obtained by or prepared for Buyer in connection with Buyer’s review of the Property and which relate to the physical condition of the Property, including, without limitation, any engineering and environmental reports completed and/or obtained by Buyer in connection with Buyer’ s review of the Property ("Property Condition Documents"), but excluding any documents that are subject to the attorney client privilege or that contain proprietary, confidential or financial information.

Seller understands and acknowledges that neither Buyer nor any of Buyer's representatives makes any representation or warranty to Seller as to the accuracy or completeness of the Property Condition Documents and that Buyer and Buyer's representatives have not made or will not make any attempt to verify th e data contained therein. Seller agrees that Buyer and Buyer's representatives shall not have any liability to Seller as a result of Seller’s use of the Property Condition Documents.

4. ACTIONS PENDING CLOSING.

4.1 Due Diligence

4.1.1 Property Materials.

4.1.1.1 Within five (5) days following the Opening of Escrow, Seller shall, at Seller’s sole cost and expense, to the extent within the Seller’s possession or control, provide to Buyer copies of all of the following documents (collectively, the " Property Materials"):
(a) All existing environmental reports for the Property; (b) All leases, occupancy agreements, operating agreements, and licenses currently in effect at the Property; and
(c) A Natural Hazards Disclosure Report in conformity with the California Natural Hazards Disclosure Act.

4.1.1.2 Seller shall promptly furnish to Buyer for its review (a) any of the items described in Section 4.1.1.1 that may come into Seller’s possession or control from and after the date of this Agreement, and (b) any additional documents and information in the possession or control of Seller reasonably requested in writing by Buyer. Except as provided in Section 8, Buyer understands and acknowledges that neither Seller nor any of Seller's representatives makes any representation or warranty to Buyer as to the accuracy or completeness of the Property Materials and that Seller and Seller's representatives shall have not made or will not make any attempt to 16498.00100\40032432.6

4 verify the data contained therein. Buyer agrees that Seller and Seller's representatives shall not have any liability to Buyer as a result of Buyer's use of the Property Materials.

4.1.2 Buyer’s Diligence Tests.

4.1.2.1 Until 5:00 pm (Pacific Time) on the date which is thirty (30) days from the Effective Date of this Agreement, (the “Due Diligence Period”), Buyer and its employees, agents, consultants, and contractors shall be entitled, at Buyer’s sole cost and expense, with 2 Business Days’ notice to: (a) enter onto the Property to perform any inspections, investigations, studies, and tests of the Property (including, without limitation, physical, engineering, soils, geotechnical, and environmental tests) that Buyer deems reasonable; and (b) investigate such other matters pertaining to the Property as Buyer may desire. Notwithstanding the foregoing, Buyer shall not conduct any invasive testing on the Property without the prior written consent of Seller, which consent shall not be unreasonably withheld, delayed or conditioned. Any entry by Buyer onto the Property shall be subject to, and conducted in accordance with, all applicable laws.

Further, Buyer shall coordinate all Buyer inspection activities in advance with Seller to limit interference with Seller’s current operations of the Property.

4.1.2.2 Buyer shall keep the Property free and clear of any mechanics' liens and indemnify, protect, defend, and hold Seller and Seller’s partners, officers, directors, shareholders, managers, members, agents, employees and/or licensees at the Property, and representatives (each an "Indemnified Party" and collectively, the "Indemnified Parties") harmless from and against any and all claims (including, without limitation, claims for mechanic’s liens or materialman’s liens), causes of action, demands, obligations, losses, damages, liabilities, judgments, costs, and expenses (including, without limitation, reasonable attorneys’ fees, charges, and disbursements) (collectively, "Claims") in connection with or arising out of any inspections of the Property carried on by or on behalf of Buyer pursuant to the terms hereof, provided, however, that Buyer shall have no responsibility or liability for (a) the gross negligence or willful misconduct of any Indemnified Party; (b) any adverse condition or defect on or affecting the Property not caused by Buyer or its employees, agents, consultants, or contractors but discovered or impacted during their inspections including, without limitation, the pre -existing presence or discovery of any matter (such as, but not limited to, any Hazardous Substance (as hereinafter defined)); and/or (c) the results or findings of any inspection.

4.1.2.3 Upon completion of Buyer's inspections, Buyer shall promptly repair any material damage to the Property caused by its entry thereon and restore the Property to substantially the same conditions as it existed prior to Buyer's entry under this Section 4.1.2.

4.1.2.4 The provisions of this Section 4.1.2 shall survive the Closing or the earlier termination of this Agreement.
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5 4.1.3 Buyer’s Termination Right. Buyer shall have the right at any time during the Due Diligence Period to terminate this Agreement by delivering a written notice of such termination to Seller and Escrow Agent (“Termination Notice”). Upon receipt of a Termination Notice, Escrow Agent shall refund any Deposit to Buyer. By no later than the last day of the Due Diligence Period, Buyer shall indicate its satisfaction and/or waiver of the Due Diligence condition described in this Section 4.1 by delivering written notice (" Feasibility Notice") to Seller a nd Escrow Agent. If Buyer fails to timely deliver a Termination Notice or a Feasibility Notice, then this Agreement and the Escrow shall be automatically deemed terminated, and the Deposit will not be refunded to Buyer, but rather will be transferred to Seller by Escrow Agent.

4.2 Title

4.2.1 Deliveries by Seller . Within five (5) Business Days after the Opening Escrow, Seller shall cause Fidelity National Title Insurance Company ("Title Insurer") to issue and deliver to Buyer (a) a current /updated commitment for an CLTA standard coverage Owner’s Policy of Title Insurance for the Property (the " Title Report") and (b) legible copies of all documents referenced therein (collectively with the Title Report, the "Title Documents").

4.2.2 B uyer’s Review of Titl e. Buyer shall have fifteen (15) days from the Opening of Escrow ("Title Review Date") to notify Seller in writing of any objection that Buyer may have to any matters reported or shown in any survey or the Title Documents or any amendments or updates thereof (a "Buyer's Objection Letter") (provided, however, that if any such amendments or updates are received by Buyer after or within five (5) Business Days before the Title Review Date, Buyer shall have five (5) Business Days following Buyer’s receipt of such amendment or update and copies of all documents referenced therein to notify Seller of objections to matters shown on any such amendment or update that were not disclosed on the previously delivered survey or Title Documents and the Closing Date shall a utomatically be extended as necessary to facilitate such notice period and any subsequent periods for Seller's response and Buyer's election as provided in subsections (i) and (ii), below). Matters shown as exceptions to coverage in the Title Report (or any amendments or updates thereof) that are not timely objected to by Buyer as provided above shall be deemed to be " Permitted Exceptions." Seller shall cooperate, at no cost to Seller, with Buyer to eliminate matters objected to by Buyer, but, except as set forth in the last sentence of this Section

4.2.2, Seller shall have no obligation to cure or
correct any matter objected to by Buyer. On or before the tenth (10th) Business Day following Seller’s receipt of Buyer’s Objection Letter, Seller may elect, by delivering written notice of such election to Buyer and Escrow Agent ("Seller's Response"), to cause Title Insurer to remove or insure over any matters objected to in Buyer’s Objection Letter. If Seller fails to deliver Seller’s Response within the period set forth above, it shall be deemed an election by Seller not to cause Title Insurer to so remove or insure over such objections. If Seller elects or is deemed to have elected not to cause Title Insurer to so remove or insure, or if Buyer determines, in its sole discretion, that any proposed endorsement for or insurance over an objected matter is unsatisfactory, then Buyer must elect, by delivering written notice of such election to Seller and Escrow Agent on or before the earlier to occur of (a) the tenth (10th) Business Day following Buyer’s receipt of Seller’s Response or (b) if no Seller’s Response is received by Buyer, the tenth(10th) Business Day following the date on which Seller shall have been deemed to have responded, as provided above, to: (i) terminate this Agreement, in which case the Deposit, to the extent previously deposited in Escrow, shall be immediately returned to Buyer; or (ii) proceed with 16498.00100\40032432.6

6 this transaction, in which event those objected to exceptions or matters that Seller has not elected to cause Title Insurer to so remove or insure shall be deemed to be Permitted Exceptions. In the event that Buyer fails to make such election on a timely basis, then Buyer shall be deemed to have elected to terminate this Agreement in accordance with the preceding clause (i). Notwithstanding anything else stated herein, in all events, regardless of whether Buyer has given notice of objection as stated above Seller shall be obligated to satisfy and otherwise remove all monetary and financial liens and encumbrances in existence as of the Agreement Date or incurred by Seller on or before Closing hereunder (other than current taxes not yet due) and any additional encumbrances incurred by Seller after the Agreement Date in violation of any provision of this Agreement, and, except as may be otherwise specifically set forth in this Agreement, terminate all leases, possessory agreements, licenses, and operating agreements that affect the Property and Buyer need not object to any such matters. In furtherance thereof, Seller agrees not to cause or create any additional encumbrances or other matters affecting title to the Property to be incurred following the Agreement Date that are not satisfied or otherwise removed on or before Close as contemplated above.

4.2.3 Condition of Title at Closing. Upon the Closing, Seller shall sell, transfer, and convey to Buyer fee simple title to the Property by a duly executed and acknowledged grant deed in the form of Exhibit "B" attached hereto (the "Grant Deed"), subject only to the Permitted Exceptions and the reservations and other matters, if any, referenced or described in said Grant Deed.

4.3 D
evelopment Entitlements

4.3.1 Entitlements. Collectively entitlements shall mean all necessary entitlements, permits, approvals, authorizations, licenses and consents and modifications for commencement of Buyer’s planned development and improvement of the Property, including without limitation, a pre -application meeting, environmental impact reports and/or negative declarations, specific plan(s), general plan amendment(s), variances, development agreements, a tentative tract map, subdivision maps, zoning authorizations and changes, conditional use permits, housing agreements, site plans, drawings, specifications and any other authorizations and approvals (“Entitlements”).

4.3.2 E
xpiration of Buyer’s Tentative Tract Map. If Buyer’s approved tentative tract map for a residential subdivision to the Property expires, Seller shall have the right, but not the obligation to exercise the option and repurchase the Property for the sum of One Million Five Hundred Twenty Five Thousand Dollars ($1,525,000.00)(“Repurchase Price”) within one (1) year of the expiration of the tentative tract map (“Seller’s Repurchase Option.”) Upon Seller exercising Seller’s Repurchase Option and delivery of the Repurchase Price within said one (1) year period, Buyer shall deliver to Seller a duly executed and acknowledged grant deed, in the form attached here to as Exhibit “C”, conveying fee simple title to the Property to the Seller. Any costs, fees and damages incurred by Seller in connection with Seller’s enforcement of this Section 4.3.2 shall be paid by Buyer to Seller. This provision shall survive the Closing. 16498.00100\40032432.6

7 5. DESCRIPTION OF PROPERTY

5.1 The Property. As used in this Agreement, the term "Property" shall mean, collectively, all of Seller’s right, title, and interest in and to: (a) the Land; (b) all improvements thereon (the "Improvements"); and (c) all of the rights, privil eges, appurtenances, hereditaments, easements, reversions, and remainders pertaining to or used in connection with the Land and/or any of the Improvements, including, without limitation, all (i) development rights and credits, air rights, water, water rights, and water stock relating to the Land, (ii) strips and gores, streets, alleys, easements, rights-of-way, public ways, or other rights appurtenant, adjacent, or connected to the Land, and (iii) minerals, oil, gas, and other hydrocarbon substances in, under, or that may be produced from the Land.

6. CONDITIONS TO CLOSING.

6.1 Buyer’s Closing Conditions. The obligation of Buyer to complete the transaction contemplated by this Agreement is subject to the following conditions precedent (and conditions concurrent, with respect to deliveries to be made by Seller at the Closing) (the "Buyer's Closing Conditions"), which conditions may be waived, or the time for satisfaction thereof extended, by Buyer only in a writing executed by Buyer:

6.1.1 T
itle . Title Insurer shall be irrevocably and unconditionally prepared and committed to issue to Buyer (with an effective date not earlier than the Closing Date), a CLTA standard coverage owner’s policy of title insurance ("C LTA Standard Policy") in favor of Buyer for the Property (a) showing fee title to the Property vested in Buyer, (b) with liability coverage in an amount equal to the Purchase Price, (c) with those endorsements reasonably requested by Buyer including, without limitation, a Mechanic's Lien Endorsement, and (d) containing no exceptions other than the Permitted Exceptions and the reservations and other matters referenced or described in the Grant Deed (the "Owner’s Title Policy"). Buyer may, at its expense, obtain from the Title Company an ALTA extended coverage owner's policy provided the issuance of such ALTA form title policy shall not be a condition to Close of Escrow and shall cause no delay to the Close of Escrow. In the event Buyer elects to obtain an ALTA extended coverage policy, Buyer shall obtain an ALTA Survey, at its sole cost and expense, in a timely manner so as to facilitate the issuance of the ALTA extended coverage policy upon the Close of Escrow.

6.1.2 S
eller’s Due Performance. All of the representations and warranties of Seller set forth in Section 8 shall be true, correct, and complete in all material respects as of the Closing Date, and Seller, on or prior to the Closing Date, shall have complied with and/or performed all of the obligations, covenants, and agreements required on the part of Seller to be complied with or performed pursuant to the terms of this Agreement on or prior to the Closing.

6.1.3 P
hysical Condition of Property. The physical condition of the Property shall be substantially the same on the Closing Date as on the Agreement Date, except for reasonable wear and tear, the presence of any agricultural products being grown depending on the closing date, and any damages due to any act of Buyer or Buyer’s representatives.

6.1.4 N
o Moratorium. There shall be no general, agency- wide moratorium, injunction, zoning change, restraining order, or similar restriction imposed by the City, County, or 16498.00100\40032432.6

8 any other governmental authority, utility provider, court, or administrative body that precludes, restricts or prevents utility service, the issuance of building permits, utility services or certificates of occupancy with respect to the Property and/or the construction of residences on the Property.

6.1.5 Bankruptcy. No action or proceeding shall have been commenced by or against Seller under the federal bankruptcy code or any state law for the relief of debtors or for the enforcement of the rights of creditors, and no attachment, execution, lien, or levy shall have attached to or been issued with respect to Seller’s interest in the Property or any portion thereof.

6.1.6 N
o Entitlement. The “Final Approval” (defined below) of the Tentative Tract Map has occurred. “Final Approval” shall be deemed to have occurred with respect to the Tentative Tract Map when (i) the Tent ative Tract Map has been approved officially by the appropriate governmental agency through duly authorized resolution, ordinance or administrative determination (or similar action) and all applicable and legally valid periods for the filing of an administrative appeal, judicial challenge or request for reconsideration related thereto shall have expired.

6.1.7 P
ossession/Removal of Personal Property. Upon the Close of Escrow, Seller shall deliver exclusive possession of the Property to Buyer. Prior to the Close of Escrow Seller shall have the right to remove any or all improvements and Seller's equipment, trade fixtures or other personal property.

6.2 S
eller's Closing Conditions. All of the representations and warranties of Buyer set forth in Section 9 shall be true, correct, and complete in all material respects as of the Closing Date, and Buyer, on or prior to the Closing Date, shall have complied with and/or performed all of the obligations, covenants, and agreements required on the part of Buyer to be complied with or performed pursuant to the terms of this Agreement on or prior to the Closing.

7. CLOSING.

7.1 Closing Date. Subject to the provisions of this Agreement, the Closing sh all take place on or before the date which is sixty (60) days from the expiration of the Due Diligence Period ("Closing Date"). As used herein, the " Closing" shall mean the recordation of the Grant Deed in the Official Records.

7.2 D eliveries by Seller . On or before the Closing Date, Seller, at its sole cost and expense, shall deliver or cause to be delivered into Escrow the following items, documents, and instruments, each dated as of the Closing Date, fully executed and, if appropriate acknowledged, and, if applicable, in proper form for recording:

7.2.1 G
rant Deed . The Grant Deed conveying the Property to Buyer;

7.2.2 Non-Foreign Affidavit. A Non -Foreign Affidavit in the form attached hereto as Exhibit "D" (the "Non-Foreign Affidavit");

7.2.3 State Affidavit. A California Franchise Tax Board Form 593- C (the "State Affidavit");
16498.00100\40032432.6

9 7.2.4 Owner’s Affidavit . An owner’s affidavit or seller’s certificate duly executed by Seller in the form customarily required by title insurance companies in the county in which the Property is located, in connection with the issuance of title insurance, to remove standard exceptions for mechanics liens, the gap period from the latest title update of Buyer’s title insurance commitment and Parties in possession;

7.2.5 P
roof of Authority. Such proof of Seller’s authority and authorization to enter into this Agreement and the transaction contemplated hereby, and such proof of the power and authority of the individual(s) executing or delivering any instruments, documents, or certificates on behalf of Sel ler to act for and bind Seller as may be reasonably required by Title Insurer or Escrow Agent; and

7.2.6 O
ther . Such other items, documents, and instruments as may be reasonably required by Buyer, Title Insurer, Escrow Agent, or otherwise in order to effectuate the provisions of this Agreement and the Closing and/or otherwise to fulfill the covenants and obligations to be performed by Seller at the Closing pursuant to this Agreement.

7.3 D
eliveries by Buyer. On or before the Closing Date, Buyer, at its sole cost and expense, shall deliver or cause to be delivered into Escrow the following funds and the following items, documents, and instruments, each dated as of the Closing Date, fully executed and, if appropriate acknowledged, and, if applicable, in proper form for recording:

7.3.1 P
urchase Price. Cash or other immediately available funds in an amount equal to the unpaid sum of the Purchase Price (less the Deposit) and all of Buyer’s share of the Closing Costs (as hereinafter defined) (and otherwise sufficient to close the transaction contemplated herein);

7.3.2 P
roof of Authority. Such proof of Buyer’s authority and authorization to enter into this Agreement and the transaction contemplated hereby, and such proof of the power and authority of the individual(s) executing or delivering any instruments, documents, or certificates on behalf of Buyer to act for and bind Buyer as may be reasonably required by Title Insurer or Escrow Agent; and

7.3.3 O
ther . Such other items, documents, and instruments as may be reasonably required by Seller, Title Insurer, Escrow Agent, or otherwise in order to effectuate the provisions of this Agreement and the Closing and/or otherwise to fulfill the covenants and obligations to be performed by Buyer at the Closing pursuant to this Agreement.

7.4 A
ctions by Escrow Agent . Provided that Escrow Agent shall not have received written notice from Buyer or Seller of the failure of any condition to the Closing or of the termination of the Escrow and this Agreement, when Buyer and Seller have deposited into Escrow the documents and funds required by this Agreement and Title Insurer is irrevocably and unconditionally prepared and committed to issue the Owner’s Title Policy in accordance with the terms hereof, Escrow Agent shall, in the order and manner herein below indicated, take the following actions:
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10 7.4.1 Recording. Cause the Grant Deed and any other documents customarily recorded and/or that the Parties hereto may mutually direct to be recorded in the Official Records and obtain conformed copies thereof for distribution to Buyer and Seller.

7.4.2 F unds. Disburse all funds as follows:

7.4.2.1 Pursuant to the Closing Statement (as hereinafter defined), retain for Escrow Agent’s own account all escrow fees and costs, disburse to Title Insurer the fees and expenses incurred in connection with the issuance of the Owner’s Title Policy, and disburse to any other persons or entities entitled thereto the amount of any other Closing Costs;

7.4.2.2 Disburse to Seller an amount equal to the Purchase Price, less or plus the net debit or credit to Seller b y reason of the prorations and allocations of Closing Costs provided for in this Agreement; and

7.4.2.3 Disburse to the Party who deposited the same any remaining funds in the possession of Escrow Agent after the payments pursuant to Sections 7.4.2.1 and

7.4.2.2 above have been completed.

7.4.3 Delivery of Documents . Deliver: (a) to Seller (i) one original of all documents deposited into Escrow (other than the Grant Deed, the other documents recorded pursuant to the terms of this Agreement, the Non -Foreign Affidavit, the State Affidavit and the General Assignment), (ii) one copy of the Non- Foreign Affidavit, the State Affidavit and the General Assignment, and (iii) one conformed copy of each document recorded pursuant to the terms of this Agreement; and (b) to Buyer, (i) one original of all documents deposited into Escrow (other than the Grant Deed and the other documents recorded pursuant to the terms of this Agreement, but including, without limitation, the Non-Foreign Affidavit and the State Affidavit), and (ii) the one conformed copy of each document recorded pursuant to the terms of this Agreement. Originals of any documents recorded at Closing shall be delivered after such recording as indicated thereon.

7.4.4 O
wner's Title Policy . Cause Title Insurer to issue or be irrevocably and unconditionally prepared and committed to issue the Owner's Title Policy to Buyer.

7.5 P rorations/Apportionment.

7.5.1 Method of Proration. Taxes and assessments affecting the Property shall be prorated between Buyer and Seller as of the Closing Date based on a 365- day year. All non- delinquent real estate taxes and assessments on the Property shall be prorated based on the actual current tax bill. Seller is exempt from ad valorum property taxes and as such shall not incur any property taxes as a p art of the transaction, Buyer shall pay any proration for the current assessed value and Buyer shall bear all real property taxes, including all supplemental taxes, allocable to the period from and after the Closing. If any real property taxes or assessments or any expenses attributable to the Property and allocable to the period prior to the Closing are discovered or billed after the Closing, the P arties shall make any necessary adjustment after the Closing by cash payment to the Party entitled thereto within five (5) Business Days following the discovery thereof or the receipt by any Party of the bill therefor, as the case may be, so that Seller shall have borne all assessments to which it is not exempt and expenses allocable to the period prior to the Closing 16498.00100\40032432.6

11 and Buyer shall bear all real property taxes, assessments and expenses allocable to the period from and after the Closing.

7.5.2 Survival. The obligations under this Section 7.5 shall survive the Closing and the delivery and recordation of the Grant Deed for the Property.

7.6 C losing Costs. Each Party shall pay its own costs and expenses arising in connection with the Closing (including, without limitation, its own attorneys’ and advisors’ fees, charges, and disbursements), except the following costs (the "Closing Costs"), which shall be allocated between the Parties as follows:

7.6.1 Escrow Agent’s escrow fees and costs shall be paid one-half by Seller and one-half by Buyer;

7.6.2 The cost of the Owner's Title Policy attributable to the standard coverage portion shall be paid by Buyer;

7.6.3 The cost of the Owner's Title Policy attributable to the extended coverage portion shall be paid by Buyer;

7.6.4 The cost of any items required to be provided by Seller pursuant to Section

4.2.2, shall be paid by Seller, and the costs of any other endorsements to the Owner’s Title Policy shall be paid by Buyer;

7.6.5 Seller shall pay the cost of any documentary transfer taxes in connection with the recording of the Grant Deed;

7.6.6 Buyer shall pay all recording costs for recording the Grant Deed; and

7.6.7 All other closing fees and costs shall be charged to and paid by Seller and Buyer in accordance with customary practices in the County.

7.7 Closing Statement. Three (3) Business Days prior to the Closing Date, Esc row Agent shall deliver to each of the Parties for their review and approval a preliminary closing statement (the "Preliminary Closing Statement") setting forth: (a) the proration amounts allocable to each of the Parties pursuant to Section

7.5; and (b) the Closing Costs allocable to each of the Parties pursuant to Section 7.6. Based on each of the Party’s comments, if any, regarding the Preliminary Closing Statement, Escrow Agent shall revise the Preliminary Closing Statement and deliver a final, signed version of a closing statement to each of the Parties at the Closing (the "Closing Statement").

7.8 Deliveries Outside of Escrow . Upon the Closing, Seller shall deliver sole and exclusive possession of the Property to Buyer, subject only to the Permitted Exceptions. Further, Seller hereby covenants an d agrees to deliver to Buyer, on or prior to the Closing, including, without limitation, the original Property Materials to the extent within Seller’s possession or control. Effective immediately upon the Closing, any personal property remaining on the La nd shall be deemed abandoned and may be removed and disposed of by Buyer at its sole cost and expense. This Section 7.8 shall survive the Closing.
16498.00100\40032432.6

12 8. SELLER’S COVENANTS, REPRESENTATIONS AND WARRANTIES.

Seller represents, and warrants to Buyer, as of the Agre ement Date and as of the Closing Date, as follows:

8.1 Due Organization. Seller is a municipal corporation duly formed under the laws of the State of California.

8.2 S eller’s Authority; Validity of Agreements . Subject to approval of this Agreement at a duly called and noticed meeting of City Council, Seller has full right, power, and authority to sell the Property to Buyer as provided in this Agreement and to carry out its obligations hereunder.

The individuals executing this Agreement and the instruments referenced herein on behalf of Seller has/have the legal power, right, and actual authority to bind Seller to the terms hereof and thereof.

This Agreement is, and all other instruments, documents and agreements to be executed, and delivered by Seller in connect ion with this Agreement shall be, duly authorized, executed, and delivered by Seller and the valid, binding, and enforceable obligations of Seller (except as enforcement may be limited by bankruptcy, insolvency, or similar laws) and do not, and as of the Closing Date will not result in any violation of, or conflict with, or constitute a default under, any provisions of any agreement of Seller or any mortgage, deed of trust, indenture, lease, security agreement, or other instrument, covenant, obligation, or agreement to which Seller or the Property is subject, or any judgment, law, statute, ordinance, writ, decree, order, injunction, rule, ordinance, or governmental regulation or requirement affecting Seller or the Property.

8.3 N
o Third- Party Rights. Except as disclosed in the Title Report, Seller is not aware of any leases or occupancy agreements that grant third -Parties any possessory or usage rights to all or any part of the Property.

8.4 L itigation . Seller has received no written notice of any legal proceedin gs or administrative actions of any kind or character adversely affecting the Property or Seller’s interest therein, including any federal, state, or local law, ordinance, or regulation relating to the environmental conditions in, at, on, under, or about the Property, including, but not limited to, soil and groundwater conditions ("Environmental Laws").

8.5 A
ctual Knowledge. For purposes hereof, "Seller is not aware" or "to Seller's knowledge," or like terms shall mean the current actual knowledge of Deputy C ity Manager , without implying any duty of investigation or inquiry. In furtherance thereof, Seller hereby warrants and represents that Deputy City Manager is the Seller's representative most knowledgeable regarding the Property.

8.6 B
uyer Covenant to Defend t his Agreement. The Buyer acknowledges that the Seller is a “public entity” and/or “public agency” as defined under applicable California law. Therefore, the Seller must satisfy the requirements of certain California statutes relating to the actions of public entities and public agencies . Also, as a public body, the Sellers’s action in approving this Agreement may be subject to proceedings to invalidate this Agreement or mandamus. The Buyer assumes the risk of delays and damages that may result to the Buyer from any third -party legal actions related to the Seller’s approval of this Agreement or the pursuit of the activities contemplated by this Agreement, even in the event that an error, omission or abuse of discretion 16498.00100\40032432.6

13 by the Seller is determined to have occurred. If a government entity delivers a notice of violation, or a private entity files a claim , or any third party initiates a legal action , regarding the Seller ’s approval of this Agreement or the pursuit of the activities contemplated by this Agreement (each, an “Action”), the Seller may terminate this Agreement on thirty (30) days written notice, without any further obligation to perform the terms of this Agreement and without any liability to the Buyer resulting from such termination, unless the Buyer unconditionally agrees to indemnify and defend the Seller, with legal counsel acceptable to the Seller, against such Action, as provided in the next sentence. Within thirty (30) days of receipt of the Seller’s notice of intent to terminate this Agreement, as provided in the preceding sentence, the Buyer may offer to defend the Seller, with legal counsel reasonably acceptable to the Seller , against the Action and pay all costs, including reasonable attorneys’ fees, monetary awards, sanctions, attorney fee awards, expert witness and consulting fees, and the expenses of any and all financial or performance obligations resulting from the disposition of the A ction. Any such offer from the Buyer must be in writing and reasonably acceptable to the Seller in both form and substance. Nothing contained in this Section

8.6 shall be deemed or construed to be an express or implied admission that the Seller is liable to the Buyer or any other person or entity for damages alleged from any alleged or established failure of the Seller to comply with any statute. This Section 8.6 shall survive the Closing.

8.7 Survival. All of the representations, warranties, and agreements of Seller set forth in this Agreement shall be true upon the Agreement Date, shall be deemed to be repeated at and as of the Closing Date, and shall survive the delivery of the Grant Deed and the Closing for a period of one (1) year. Prior to a termination of this Agreement, Seller shall not take any action, fail to take any required action, or willfully allow or consent to any action that would cause any of Seller’s representations or warranties to become untrue. If any representation or warranty of Seller was true as of the date of this Agreement, but is not true as of the Closing Date, then Seller shall disclose this changed fact to Buyer in writing. So long as Seller makes the foregoing disclosure and the change of circumstances regarding the representation or warranty did not arise due to the fault of Seller, then Seller shall not be in breach of this Agreement due to the fact that the representation or warranty has become untrue as of the Closing Date; provided, however, the fact that any representation or warranty under this Section 8 is untrue as of the Closing Date shall still be a failure of a condition pursuant to Section 6.1.2. Notwithstanding the foregoing, if Buyer has actual knowledge of the incorrectness of any representation or warranty set forth in this Section 8 as of the Close of Escrow and Buyer has not elected to terminate this Agreement as provided herein, then Buyer will be deem ed to have waived any claim against Seller for the incorrectness of such representation or warranty.

9. BUYER’S REPRESENTATIONS AND WARRANTIES.

Buyer represents and warrants to Seller, as of the Agreement Date and as of the Closing Date, as follows:

9.1 Due Organization. Buyer is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of California and is authorized to do business in the State of California.

9.2 B uyer’s Authority; Validity of Agreements. Buyer has full right, power, and authority to purchase and acquire the Property from Seller as provided in this Agreement and to 16498.00100\40032432.6

14 carry out its obligations hereunder. The individual(s) executing this Agreement and the instruments referenced herein on behalf of Buyer has/have the legal power, right, and actual authority to bind Buyer to the terms hereof and thereof. This Agreement is, and all other instruments, documents, and agreements to be executed and delivered by Buyer in connection with this Agreement shall be, duly authorized, executed, and delivered by Buyer and the valid, binding, and enforceable obligations of Buyer (except as enforcement may be limited by bankruptcy, insolvency, or similar laws) and do not, and as of the Closing Date will not, violate any provision of any law, statute, ordinance, rule, regulation, agreement or judicial order to which Buyer is a Party or to which Buyer is subject.

10. SURVIVAL. ALL OF THE REPRESENTATIONS, WARRANTIES, AND

AGREEMENTS OF BUYER SET FORTH IN THIS AGREEMENT SH ALL BE TRUE UPON

THE AGREEMENT DATE, SHALL BE DEEMED TO BE REPEATED AT AND AS OF THE

CLOSING DATE AND SHALL SURVIVE THE DELIVERY OF THE GRANT DEED AND THE CLOSING FOR A PERIOD OF ONE (1) YEAR. PRIOR TO A TERMINATION OF THIS

AGREEMENT, BUYER SHALL NOT TAKE ANY ACTION, FAIL TO TAKE ANY

REQUIRED ACTION, OR WILLFULLY ALLOW OR CONSENT TO ANY ACTION THAT WOULD CAUSE ANY OF BUYER’S REPRESENTATIONS OR WARRANTIES TO BECOME UNTRUE.

11. AS-IS. THE PARTIES HEREBY ACKNOWLEDGE AND AGREE AS FOLLOWS: (A) BUYER IS A SOPHISTIC ATED BUYER WHO IS FAMILIAR WITH THIS TYPE OF PROPERTY; (B) EXCEPT AS MAY BE SPECIFICALLY SET FORTH IN THIS

AGREEMENT, THE DEED, AND/OR ANY OTHER DOCUMENT OR INSTRUMENT DELIVERED BY SELLER AT CLOSING (THE " EXPRESS REPRESENTATIONS "),

NEITHER SELLER NOR ANY O F ITS AGENTS, REPRESENTATIVES, BROKERS,

OFFICERS, DIRECTORS, SHAREHOLDERS, MEMBERS, OR EMPLOYEES HAS MADE

OR WILL MAKE ANY REPRESENTATIONS OR WARRANTIES OF ANY KIND

WHATSOEVER, WHETHER ORAL OR WRITTEN, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY; AND (C) THE PROPERTY IS BEING SOLD TO BUYER IN ITS PRESENT "AS IS" CONDITION SUBJECT TO THE EXPRESS REPRESENTATIONS.

SUBJECT TO THE EXPRESS REPRESENTATIONS AND THE TERMS HEREOF, BUYER

WILL BE AFFORDED THE OPPORTUNITY TO MAKE ANY AND ALL INSPECTIONS OF

THE PRO PERTY AND SUCH RELATED MATTERS AS BUYER MAY REASONABLY

DESIRE AND, ACCORDINGLY, SUBJECT TO THE EXPRESS REPRESENTATIONS,

BUYER WILL RELY SOLELY ON ITS OWN DUE DILIGENCE AND INVESTIGATIONS IN PURCHASING THE PROPERTY. IN CONNECTION WITH THE FOREGOING, BUYER

EXPRESSLY AGREES TO WAIVE ANY AND ALL RIGHTS WHICH BUYER MAY HAVE UNDER SECTION 1542 OF THE CALIFORNIA CIVIL CODE, WHICH PROVIDES AS FOLLOWS:
"
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT

THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR

SUSPECT TO EXI ST IN HIS OR HER FAVOR AT THE TIME OF

EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR

HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY."

16498.00100\40032432.6

15 12. RISK OF LOSS.

12.1 Condemnation. If, prior to any Closing, all or any portion of the Property is taken by condemnation or eminent domain (or is the subject of a pending or contemplated taking which has not been consummated), Seller shall immediately notify Buyer in writing of such fact. In such event, Buyer shall have the option to terminate this Agreement upon written notice to Seller given within ten (10) Business Days after receipt of such notice from Seller, in which event the Deposit shall be returned to Buyer. Notwithstanding the foregoing, Buyer's failure to provide writte n notice of Buyer's election to terminate within such ten (10) Business Day period shall be deemed Buyer's election to terminate this Agreement. Prior to any termination or deemed termination of this Agreement, Buyer shall have the right to participate in any proceedings and negotiations with respect to the taking and any transfer in lieu of taking (and Seller shall not consummate any transfer in lieu of taking without Buyer’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed). If Buyer waives the right to terminate this Agreement and elects to proceed with the Closing, then (a) Seller, at, and as a condition precedent to Buyer’s obligation to proceed with, the Closing, must: (i) pay to Buyer (or direct Escrow Agent to credit Buyer against the Purchase Price for) the amount of all awards for the taking (and any consideration for any transfer in lieu of taking) actually received by Seller; and (ii) assign to Buyer by written instrument reasonably satisfactory to Buyer all rights or claims to any future awards for the taking (and any consideration for any transfer in lieu of taking); and (b) the Parties shall proceed to the Closing pursuant to the terms hereof without further modification of the terms of this Agreement.

12.2 C
asualty . Prior to the Closing and notwithstanding the pendency of this Agreement, the entire risk of loss or damage by earthquake, hurricane, tornado, flood, landslide, fire, sinkhole, contamination by hazardous materials or other casualty shall be borne and assumed by Seller. If, prior to the Closing, any portion of the Property is damaged as a result of any earthquake, hurricane, tornado, flood, sinkhole, landslide, fire, contamination by hazardous materials or other casualty, Seller shall immediately notify Buyer in writing of such fact. In such event, Buyer shall have the option to terminate this Agreement upon written notice to Seller given within ten (10) Business Days after receipt of any such notice from Seller, in which event the Deposit shall be returned to Buyer. Notwithstanding the foregoing, Buyer's failure to provide written notice of Buyer's election to terminate within such ten (10) Business Day period shall be deemed Buyer's election to terminate this Agreement. Prior to any termination or deemed termination of this Agreement, Buyer shall have the right to participate in any adjustment of the insurance claim. If Buyer waives the right to terminate this Agreement and elects to proceed with the Closing, then (a) Seller, at, and as a condition precedent to Buyer’s obligation to proceed with, the Closing, must either: (i) pay to Buyer (or direct Escrow Agent to credit Buyer against the Purchase Price for) the amount of any insurance proceeds actually received by Seller plus the amount of any deductible under Seller’s insurance; or (ii) if no insurance proceeds have been received by Seller, assign to Buyer by written instrument reasonably satisfactory to Buyer all rights or claims to the insurance proceeds and credit Buyer against the Purchase Price for any deductible payable under Seller’s insurance policy; and (b) the Parties shall proceed to the Closing pursuant to the terms hereof without further modification of the terms of this Agreement. 16498.00100\40032432.6

16 13. REMEDIES.

Default by Seller. If Seller shal l breach any of the terms or provisions of this Agreement or otherwise fail to perform any of Seller’s obligations under this Agreement at or prior to Closing, and if such failure continues without cure by Seller for five (5) Business Days after Buyer provides Seller and Escrow Agent with written notice thereof (a "Seller Default"), and provided Buyer is not then in default, then Buyer may, as Buyer’s sole remedies for such failure, but without limiting Buyer’s right to recover attorneys' fees pursuant to Section 14.13 below: (a) waive the effect of such matter and proceed to consummate this transaction; (b) cancel this Agreement and receive a full refund of the Deposit and recover from Seller the reasonable out-of-pocket expenses incurred by Buyer related to the Property and this transaction, which amounts shall be payable by Seller to Buyer within five (5) Business Days following receipt by Seller of written request therefor from Buyer together with copies of invoices evidencing such expenses; or (c) proceed with any remedies available to Buyer at law or in equity, which may, without limitation, include the bringing of an action against Seller for specific performance and/or recovery of the Deposit and any other damages suffered or incurred by Buyer as a result of any breach or failure by Seller to perform any of Seller’s obligations under this Agreement.

13.1 Default by Buyer . IF BUYER SHALL BREACH ANY OF THE TERMS OR

PROVISIONS OF THIS AGREEMENT OR OTHERWISE FAIL TO PERFORM ANY OF BUYER’S OBLIGATIONS UNDER THIS AGREEMENT AND IF SUCH FAILURE CONTINUES WITHOUT CURE BY BUYER FOR THREE (3) BUSINESS DAYS AFTER

SELLER PROVIDES BUYER AND ESCROW AGENT WITH WRITTEN NOTICE THEREOF,

AND PROVIDED SELLER IS NOT THEN IN DEFAULT, THEN SELLER MAY WAIVE

SUCH BREACH AND PROCEED TO CONSUMMATE THIS TRANSACTION IN

ACCORDANCE WITH THE TERMS HEREOF, OR SELLER MAY, AS ITS EXCLUSIVE REMEDY (BUT WITHOUT LIMITING SELLER’S RIGHT TO RECOVER ATTORNEYS' FEES PURSUANT TO SECTION 14.13 BELOW), CANCEL THIS AGREEMENT AND

RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES AND AS CONSIDERATION FOR

THE ACCEPTANCE OF THIS AGREEMENT AND FOR TAKING THE PROPERTY OFF THE MARKET, AND NOT AS A PENALTY. BUYER AND SELLER HAVE DETERMINED

AND HEREBY AGREE THAT IT WOULD BE IMPRACTICAL OR EXTREMELY

DIFFICULT, IF NOT IMPOSSIBLE, TO ASCERTAIN WITH ANY DEGREE OF CERTAINTY

THE AMOUNT OF DAMAGES THAT WOULD BE SUFFERED BY SELLER IF BUYER

FAILS TO PERFORM ANY OF ITS OBLIGATIONS IN ACCORDANCE WITH THE

PROVISIONS OF THIS AGREEMENT, AND THE PARTIES AGREE THAT A

REASONABLE ESTIMATE OF SUCH DAMAGES UNDER THE CIRCUMSTANCES IS AN AMOUNT EQUAL TO THE DEPOSIT. ACCORDINGLY, BUYER AND SELLER AGREE

THAT IF BUYER BREACHES ANY OF ITS OBLIGATIONS UNDER THIS AGREEMENT

OR OTHERWISE DEFAULTS HEREUNDER, SELLER MAY RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES. THE PAYMENT AND RETENTION OF THE DEPOSIT AS

LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT IS

INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677.

16498.00100\40032432.6

17 Seller’s Initials Buyer’s Initials

14. BROKERS.

Neither Party has been represented in this transaction by a broker. Each of Buyer and Seller hereby represents and warrants to and agrees with each other that it has not had, and shall not have, any dealings with any third Party to whom the payment of any broker’s fee, finder’s fee, commission, or other similar compensation shall or may become due or payable in connection with the transaction con templated hereby. Seller shall indemnify, defend, protect, and hold Buyer harmless for, from, and against any and all Claims incurred by Buyer by reason of any breach or inaccuracy of the representation, warranty, and agreement of Seller contained in this Section.

Buyer shall indemnify, defend, protect, and hold Seller harmless from and against any and all Claims incurred by Seller by reason of any breach or inaccuracy of the representation, warranty, and agreement of Buyer contained in this Section. The provisions of this Section shall survive the Closing or earlier termination of this Agreement.

15. MISCELLANEOUS PROVISIONS.

15.1 Entire Agreement . This Agreement, including the exhibits attached hereto, constitutes the entire agreement between Buyer and Seller p ertaining to the subject matter hereof and supersedes all prior agreements, understandings, letters of intent, term sheets, negotiations, and discussions, whether oral or written, of the Parties, and there are no warranties, representations, or other agreements, express or implied, made to either Party by the other Party in connection with the subject matter hereof except as specifically set forth herein or in the documents delivered pursuant hereto or in connection herewith.

15.2 M
odification; Waiver . No supplement, modification, waiver, or termination of this Agreement shall be binding unless executed in writing by the Party to be bound thereby. No waiver of any provision of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar), nor shall such waiver constitute a continuing waiver unless otherwise expressly provided.

15.3 N
otices . All notices, consents, requests, reports, demands or other communications hereunder (collectively, "Notices") shall be in writing and may be given personally, by registered or certified mail, by electronic mail, by courier, or by Federal Express (or other reputable overnight delivery service) for overnight delivery, as follows:

To Buyer: NH Southridge LLC
500 Newport Center Drive, Suite 570
Newport Beach, California 92660
Attention: J. Robert Meserve
Telephone: 949-344-2704
Email: [email protected]

To Seller: City of Fontana
8353 Sierra Avenue
16498.00100\40032432.6

18 Fontana, California 92335
Attention: City Manager
Telephone: (909) 350-7600
Email: [email protected]

With A Copy To: City Attorney
City of Fontana
Attention: Ruben Duran
Telephone: (213) 787-2569
Email: [email protected]

To Escrow Agent: Fidelity National Title Insurance Company 3237 E. Guasti Road, Suite 105
Ontario, CA 91761
Attention: Mary Lou Adame
Telephone: 909-978-3020
Email: [email protected]

or to such other address or such other person as the addressee Party shall have last designated by Notice to the other Party and Escrow Agent. All Notices shall be deemed to have been given three (3) days following deposit in the United States Postal Service (postage prepaid) or, upon receipt, if sent by overnight delivery service, courier, facsimile transmission (so long as confirmed by the appropriate automatic confirmation page), electronic mail (so long as receipt is acknowledged or otherwise confirmed), or personally delivered. Notice to a Party shall not be effective unless and until each required copy of such Notice is given. The inability to deliver a Notice because of a changed address of which no Notice was given or an inoperative facsimile number for which no Notice was given of a substitute number, or any rejection or other refusal to accept any Notice, shall be deemed to be the receipt of the Notice as of the date of such inability to deliver or rejection or refusal to accept. Any Notice to be given by any Party hereto may be given by legal counsel for such Party. Telephone numbers are provided herein for convenience only and shall not alter the manner of giving Notice set forth in this Section 15.3.

15.4 Expenses. Subject to the provision for payment of the Closing Costs in accordance with the terms of Section 7.6 of this Agreement and of any other provision of this Agreement, whether or not the transaction contemplated by this Agreement shall be consummated, all fees and expenses incurred by any Party hereto in connection with this Agreement shall be borne by such Party.

15.5 Severability. Any provision or part of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall, as to such situation and such jurisdiction, be ineffective only to the extent of such invalidity and shall not affect the enforceability of the remaining provisions hereof or the validity or enforceability of any such provision in any other situation or in any other jurisdiction.

15.6 S
uccessors and Assigns. Neither Seller nor Buyer shall assign its rights under this Agreement without the consent of the other Party, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, either Party shall have the right, without the 16498.00100\40032432.6

19 consent of the other, to assign its rights under this Agreement to an affiliate entity directly or indirectly controlling, controlled by or under common control with the assigning Party or an entity in which such assigning Party or such an affiliate directly or indirectly owns a financial and voting interest and directly or indirectly is responsible for day to day management of the entity provided such assignee assumes such Party's obligations hereunder pursuant to a written agreement, a copy of which shall be provided to the other Party by the assigning Party. Notwithstanding any such assignment, no assignment shall relieve the assignor of any obligations or liability under this Agreement. Subject to the foregoing, all of the Parties’ rights, duties, benefit s, liabilities, and obligations under this Agreement shall inure to the benefit of, and be binding upon, their respective successors and assigns.

15.7 Counterparts. This Agreement may be executed in as many counterparts as may be deemed necessary and convenien t, and by the different Parties hereto on separate counterparts, each of which, when so executed, including, without limitation, by .pdf scanned counterparts of any initialed or executed pages delivered via electronic mail, shall be deemed an original, but all such counterparts shall constitute one and the same instrument.

15.8 G
overning Law; Jurisdiction. This Agreement shall be governed by and construed under the laws of the State of California without regard to conflicts-of-laws principles that would require the application of any other law. Each Party hereby consents to the exclusive jurisdiction of any court of competent jurisdiction in San Bernardino County in any action related to or arising under this Agreement.

15.9 H
eadings . The Section headings of this Agreement are for convenience of reference only and shall not be deemed to modify, explain, restrict, alter, or affect the meaning or interpretation of any provision hereof.

15.10 T
ime of Essence. Time shall be of the essence with respect to all matters contemplated by this Agreement.

15.11 F urther Assurances . In addition to the actions recited herein and contemplated to be performed, executed, and/or delivered by Seller and Buyer, during the term of this Agreement and after the Closing, Seller and Buyer agree to perform, execute, and/or deliver or cause to be performed, executed, and/or delivered any and all such further acts, instruments, deeds, and assurances as may be reasonably required to consummate the transaction contemplated hereby. In furtherance of the foregoing, so long as Buyer is not in default under the terms of this Agreement, Seller will cooperate, as reasonably needed, and at no cost to Seller, in Buyer's feasibility review process, which shall include but not be limited to Seller's consent to Buyer's unrestricted access to agencies, representatives, tenants, consultants and other parties familiar with the Property and the execution and delivery of such applications or other documents as reasonably requested by Buyer.

15.12 C
onstruction. As used in this Agreement, the masculine, feminine, and neuter gender and the singular or plural shall each be construed to include the other whenever the context so requires. This Agreement shall be construed as a whole and in accordance with its fair meaning, without regard to any presumption or rule of construction causing this Agreement or any part of it to be construed against the Party causing the Agreement to be written. The Parties acknowledge that each has had a full and fair opportunity to review the Agreement and to have it reviewed by 16498.00100\40032432.6

20 counsel. If any words or phrases in this Agreement have been stricken, whether or not replaced by other words or phrases, this Agreement shall be construed (if otherwise clear and unambiguous) as if the stricken matter never appeared and no inference shall be drawn from the former presence of the stricken matters in this Agreement or from the fact that such matters were stricken.

15.13 Attorneys' Fees. In the event that either Party hereto brings an action or proceeding against the other Party to enforce or interpret any of the covenants, conditions, agreements, or provisions of this Agreement, the prevailing Party in such action or proceeding shall be awarded all costs and expenses of such action or proceeding, including, without l imitation, attorneys’ fees (including fees for a Party’s use of in- house counsel), charges, disbursements, and the fees and costs of expert witnesses. If any Party secures a judgment in any such action or proceeding, then any costs and expenses (including, but not limited to, attorneys’ fees and costs) incurred by the prevailing Party in enforcing such judgment, or any costs and expenses (including, but not limited to, attorneys’ fees and costs) incurred by the prevailing Party in any appeal from such judgment in connection with such appeal shall be recoverable separately from and in addition to any other amount included in such judgment. The preceding sentence is intended to be severable from the other provisions of this Agreement, and shall survive and not be merged into any such judgment.

This Section shall survive Closing and any earlier termination of this Agreement.

15.14 B
usiness Days. As used herein, the term " Business Day" shall mean a day that is not a Saturday, Sunday, or legal holiday. In the event that the date for the performance of any covenant or obligation under this Agreement shall fall on a Saturday, Sunday, or legal holiday, the date for performance thereof shall be extended to the next Business Day. Similarly, in the event that the day for the performance of any covenant or obligation under this Agreement involving Escrow Agent shall fall on a Business Day on which Escrow Agent is closed for business to the public, the date for performance thereof shall be extended to the next Business Day on which Escrow Agent is open for business to the public.

[Signatures on following page]

16498.00100\40032432.6

21 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written.

SELLER:

CITY OF FONTANA,
a municipal corporation

By:

Matthew Ballantyne, City Manager

ATTEST:

_________________________
Tonia Lewis, City Clerk

BUYER:

NH SOUTHRIDGE LLC,
a California limited liability company

By NewBridge Homes LLC,
a California limited liability company,
its Managing Member

By:

Ian Harvey, Manager

ESCROW AGENT:

The undersigned Escrow Agent hereby accepts the foregoing Purchase and Sale Agreement and Joint Escrow Instructions, agrees to act as Escrow Agent under this Agreement in strict accordance with its terms, agrees to insert as the "Agreement Date" on page 1 hereof, if not otherwise dated, the latest date this Agreement was signed by Seller and Buyer and delivered to Escrow Agent, and agrees to comply with the applicable provisions of the Internal Revenue Code with respect to the transactions contemplated hereby.

FIDELITY NATIONAL TITLE INSURANCE

COMPANY
Date: , 20__ By:

Name: Mary Lou Adame
Title: Escrow Officer
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LIST OF EXHIBITS

EXHIBIT "A" LEGAL DESCRIPTION
EXHIBIT "B" GRANT DEED
EXHIBIT "C" GRANT DEED AND CERTIFICATE OF ACCEPTANCE
EXHIBIT "D" NON-FOREIGN AFFIDAVIT

16498.00100\40032432.6

EXHIBIT "A"

DESCRIPTION OF THE PROPERTY
The land referred to in this Agreement is situated in the City of Fontana, County of San Bernardino, State of California, and is described as follows:

LOT 11 OF TRACT NO. 15117, IN THE CITY OF FONTANA, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 275, PAGES 66 THROUGH 90, INCLUSIVE, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 0237-411-13-0-000

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EXHIBIT "B"

GRANT DEED

RECORDING REQUESTED BY

AND WHEN RECORDED MAIL TO

_____________________
_____________________
_____________________
_____________________

SPACE ABOVE THIS LINE FOR RECORDER'S USE
APN: 0237-411-13
Grant Deed
The undersigned Grantor(s) declare(s):

Documentary transfer tax is $_________________
Computed on full value of property conveyed, or
Computed on full value less value of liens and encumbrances remaining at time of sale.

Unincorporated area City of _______________, and

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, The City of Fontana, a municipal corporation
hereby GRANT(S) to
NH SOUTHRIDGE LLC, a California limited liability company the following described real property in the City of ___________, County of _____________, State of California:

SEE ATTACHED EXHIBIT A.

Dated: _______________, 20___

_______________________, a __________________

By: _________________________________
___________________ (Name)
___________________ (Title)

16498.00100\40032432.6

ACKNOWLEDGMENT
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 )
On before me, , Notary Public (insert name and title of the officer)
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)

16498.00100\40032432.6

EXHIBIT "A"

LEGAL DESCRIPTION

The real property is situated in the City of Fontana, County of San Bernardino, State of California, and is described as follows:

APN: 0237-411-13-0-000

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EXHIBIT "C"

RECORDING REQUESTED BY

AND WHEN RECORDED MAIL TO

_____________________
_____________________
_____________________
_____________________

SPACE ABOVE THIS LINE FOR RECORDER'S USE
APN: 0237-411-13
Grant Deed
The undersigned Grantor(s) declare(s):

Documentary transfer tax is $_________________
Computed on full value of property conveyed, or
Computed on full value less value of liens and encumbrances remaining at time of sale.

Unincorporated area City of _______________, and

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, NH SOUTHRIDGE LLC, a California limited liability company hereby GRANT(S) to
City of Fontana, a municipal corporation
the following described real property in the City of Fontana, County of San Bernardino, State of California:

SEE ATTACHED EXHIBIT A.

Dated: _______________, 20___

_______________________, a __________________

By: _________________________________
___________________ (Name)
___________________ (Title)

16498.00100\40032432.6

ACKNOWLEDGMENT
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.

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)

16498.00100\40032432.6

EXHIBIT "A"

LEGAL DESCRIPTION

The real property is situated in the City of Fontana, County of San Bernardino, State of California, and is described as follows:

APN: 0237-411-13-0-000

16498.00100\40032432.6

RECORDED AT REQUEST OF AND

SPACE ABOVE THIS LINE FOR

RECORDER'S USE
WHEN RECORDED MAIL TO:

City Clerk

CITY OF FONTANA
8353 Sierra Avenue
Fontana, CA 92335
APN: _0237-411-13__________No recording fee pursuant to Government Code Section 27383 and 6103

CITY OF FONTANA

CERTIFICATE OF ACCEPTANCE FOR RECORDATION

IRREVOCABLE OFFER OF DEDICATION OF REAL PROPERTY

This is to certify the Irrevocable Offer of Dedication dated _______________, 20__ from NH Southridge LLC to City of Fontana, a municipal corporation of the State of California, is hereby accepted for future recordation by the undersigned officers.

The interest in real property conveyed by the Offer of Dedication is made in a manner consistent with Section 7050 of the Government Code of the State of California and shall remain open and may be accepted at any time and at the sole discretion of the City Manager of City of Fontana or his designee.

CITY OF FONTANA,
a municipal corporation
Date: By:

Name: -_____________________
Its: City Manager

16498.00100\40032432.6

ACKNOWLEDGMENT
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.

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)

16498.00100\40032432.6

EXHIBIT "D"

NON-FOREIGN AFFIDAVIT

STATE OF )
) ss.

County of )
The undersigned, as authorized agent of CITY OF FONTANA, a municipal corporation ("Transferor"), after being duly sworn upon his oath deposes and says that:

Section 1445 of the Internal Revenue Code provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person. To inform NH SOUTHRIDGE LLC, a California limite d liability company (" Transferee"), that withholding of tax is not required upon the disposition of Transferor’s interest in a U.S. real property interest, the undersigned hereby certifies the following:

1. Transferor is not a non-resident alien, foreign corporation, foreign partnership, foreign trust, foreign estate, or other foreign person within the meaning of § 1445 and § 7701 of the Internal Revenue Code and the treasury regulations promulgated thereunder;

2. Transferor is not a disregarded entity as defined in Treas. Reg. § 1.1445-2(b)(2)(iii);

3. Transferor’s U.S. taxpayer identification number is: ;

4. Transferor’s business address is:
.

Transferor understands that this certification may be disclosed to the Internal Revenue Service by Transferee and that any false statement contained herein could be punished by fine, imprisonment, or both.

Under penalties of perjury Transferor declares that it has examined this certification and to the best of its knowledge and belief this certification is true, correct, and complete. The undersigned agent declares that he has the authority to sign this document on behalf of Transferor.

TRANSFEROR:

CITY OF FONTANA, a municipal
corporation

By:
____________, Mayor
ATTEST:

_________________________
____________, City Clerk

16498.00100\40032432.6

A notary public or other officer completing this
certificate verified 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 )
) ss.

COUNTY OF )

On , 20___, before me,
, 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.

Notary Public
In and For Said County and State

Fontana City CouncilJune 14, 2022

Fontana City Council
June 14, 2022