16498.10023\40972400.1
JANUARY 19, 2023
PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this “Agreement”) is made and entered into as of __________________, 2023 for reference purposes only, by and between the City of Fontana, a California municipal corporation (“Seller”), and Water of Life Community Church, a California nonprofit religious corporation (“Buyer”). The date upon which both Buyer and Seller have executed this Agreement and delivered the same to one another, shall hereinafter be referred to as the “Effective Date”.
IN CONSIDERATION of the respective agreements hereinafter set forth, Seller and Buyer hereby agree as follows:
1. Purchase and Sale of Property. Seller hereby agrees to sell “AS-IS” and convey to Buyer, and Buyer hereby agrees to purchase from Seller, subject to the terms and conditions set forth herein, the following (collectively, the “Property”):
That certain vacant real property consisting of approximately 4.2 acres of land located at Etiwanda Vineyard, and on Arrow Route [Boulevard], between Tokay Avenue and Citrus Avenue, in the City of Fontana, County of San Bernardino, State of California, commonly referred to as Assessor's Pa rcel Numbers 0232-201-12 and 0232- 201-013, all as more fully described in Exhibit A (the “Land”), together with all rights, privileges, easements or appurtenances to or affecting the Land (collectively, the “ Appurtenances”). Buyer has access rights to the Property under that certain License Agreement dated November 9, 2022 between Buyer, as “Licensee”, and Seller, as “City” ( the “License”). The term of the License shall expire concurrently with Close of Escrow.
2. Purchase Price.
(a) The purchase price for the P roperty ( “Purchase Price” ) shall be Three Million and Forty Thousand Dollars ($3,040,000.00).
(b) The Purchase Price shall be paid as follows:
(i) Within three (3) days following the Effective Date, Seller and Buyer shall open an escrow in connection herewith ( “Escrow”) at ________________________ (“Escrow Holder”), and Buyer shall deposit into Escrow the amount of One Hundred Dollars ($100) (“Initial Deposit”) in cash or other immediately available funds. (ii) The Initial Deposit shall be held by Escrow H older in an interest - bearing account for the benefit of Buyer in accordance with this Agreement. Notwithstanding anything herein to the contrary, the Initial Deposit shall be non- refundable, independent consideration (“Independent Consideration”) and paid to Seller within 3 days of the Effective Date. The Independent Consideration shall serve as consideration for the granting of the time periods herein contained for Buyer to exercise Buyer's right to satisfy and approve all of Buyer's conditions herein contained.
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2 (iii) After the Closing, if this Agreement has not been terminated earlier, Buyer shall pay the remainder of the Purchase Price according to the terms and conditions set forth in the Promissory Note (“ Note”) and Deed of Tru st attached hereto as Exhibits C and D, respectively, which provide: Buyer shall pay Seller monthly interest-only payments in the amount of Ten Thousand One Hundred and Thirty Three Dollars ($10,133/month) for a period of ten (10) years until the Maturity Date, defined in the Note as March 1, 2033, at which point the Purchase Price (less any amount prepaid towards the principal) shall be due and payable in full.
3. Title to the Property. At the Closing, Seller shall cause to be conveyed to Buyer fee simple title to the Property by duly executed and acknowledged grant deed substantially in the form attached hereto as Exhibit E and incorporated herein by this reference (the “ Grant Deed”) as well as a duly executed Bill of Sale for the Personal Property, if any. As used in this Agreement, Closing (the “Closing”) shall be deemed to occur upon the recording of the Grant Deed. Evidence of delivery of fee simple title shall be the issuance by Escrow Holder to Buyer of an ALTA standard coverage owner's policy of title insurance in the amount of the Purchase Price , or an extended coverage owner’s policy if requested by Buyer, insuring fee simple title to the Property in Buyer, subject only to such exceptions as Buyer shall have approved as provided below (the “Title Policy”). The Title Policy shall provide full coverage against mechanics' and materialmen's liens and shall contain such special endorsements as Buyer may reasonably require, including, without limitation, any endorsements required as a condition to Buyer's approval of any title exceptions (the “Endorsements”). Within five (5) business days following the opening of Escrow, Seller shall order the issuance of a preliminary title report with respect to the Property, together with copies of all underlying documents referenced therein and a map containing a plotting of all easements capable of being plotted (collectively, the “Preliminary Report”), to be prepared by the Escrow Holder and delivered to Buyer. No later than two (2) business days after receipt of the Preliminary Report (“Title Review Period”), Buyer shall give written notice to Seller of any items contained in the Preliminary Report which Buyer disapproves ( “Buyer's Disapproval Notice”).
Failure of Buyer to notify Seller of Buyer's disapproval of all or any item on the Preliminary Report shall be deemed to be an approval by Buyer of such item(s). In any event, and without necessity of listing on Buyer’s Disapproval Notice, Seller covenants to remove as exceptions to title prior to the Closing, any mortgages, deeds of trust, and other monetary encumbrances (collectively, “Disapproved Liens ”) shown on the Preliminary Report except for real property taxes not delinquent or any lien or encumbrance arising from Buyer’s use, occupation or activities on the Property under the License . Seller shall notify Buyer no later than five ( 5) business days after receipt of Buyer's Disapproval Notice whether it elects to remove such other items disapproved by Buyer. If Seller fails to timely respond to Buyer’s Disapproval Notice, then Seller will be deemed to have elected not to cure any objections listed in Buyer’s Disapproval Notice, except that Seller shall continue to be obligated to remove Disapproved Liens. If by the proposed Closing Date , there remain exceptions to title which have not been modified to the satisfaction of Buyer and/or removed prior to the Closing Date, then Buyer may elect to do either of the following: (i) accept such exceptions and proceed to take title to the Real Property subject to such exception(s); or (ii) this Agreement may be terminated in accordance with Section 4(b). In the event Buyer elects to terminate this Agreement pursuant to this Section 3, neither p arty shall have any further obligations to the other hereunder (except under provisions of this Agreement which specifically state that they survive termination).
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3 4. Feasibility.
(a) From and after the Effective Date until the Closing or earlier termination of this Agreement, Seller shall afford authorized representatives of Buyer access to the Property, upon reasonable prior notice to Seller, and so long as such access does not unreasonably interfere with the conduct of business on or use of the Property, for purposes of conducting such physical inspections and investigations of the Property as Buyer deems necessary (the “ Inspections”).
Seller's representative shall be present with Buyer or Buyer's representative for any access to the Property. The Inspections and investigations may include, without limitation, (i) a review of existing zoning, entitlement, planning or similar issues applicable to the Property; (ii) a review of the physical condition of the Property a nd the systems serving the Property; (iii) a review of the environmental condition of the Property, including a Phase I environmental site assessment and any proposal regarding a Phase II environmental site assessment. Buyer agrees not to conduct or cause to be conducted a Phase II environmental site assessment without the prior written consent of Seller. Buyer's Inspections and investigations shall be governed by Section 14. (b) As used herein, the term ( “Feasibility Period”) shall refer to a period of time to expire at 5:00 p.m., California time, on the fifteenth (15th) calendar day following the expiration of the Title Review Period; provided, however, that if the 15th day is a Saturday, Sunday or holiday on which banking institutions are closed in the Stat e of California, then the Feasibility Period shall expire on the following business day. Buyer may elect, by written notice to Seller at any time prior to the expiration of the Feasibility Period, to terminate this Agreement, which election shall be in Bu yer's sole and absolute discretion. If Buyer desires to terminate this Agreement pursuant to this Section 4(b) then before the expiration of the Feasibility Period, or under Section 3 above, Buyer shall deliver written notice to Seller of Buyer's election to terminate (the “Buyer's Notice to Terminate” ). If Buyer desires to proceed with the purchase of the Property subject to the remaining conditions set forth in this Agreement, then on or before the expiration of the Feasibility Period, Buyer shall deliver written notice to Seller of such election to proceed (the “Buyer's Notice to Proceed ”), electing to waive Buyer's right of termination pursuant to this Section 4(b) and proceed with the Closing subject to the remaining conditions set forth in this Agreement. If Buyer fails to deliver either Buyer's Notice to Terminate or Buyer's Notice to Proceed to Seller prior to the expiration of the Feasibility Period, then Buyer shall be deemed to have elected to proceed with this Agreement and the Closing. In the event of the termination of this Agreement purs uant to this Section 4(b), neither party shall have any further obligations to the other hereunder (except under provisions of this Agreement which specifically state that they survive termination).
(c) In the event Buyer elects to terminate this Agreement pur suant to Section 4(b), or pursuant to Section 3, or if Closing does not occur for any reason except for a Seller default, Buyer shall return all Seller's Deliveries to Seller. Buyer further agrees that prior to Closing, Buyer shall provide Seller with copies of all studies, reports, appraisals and other materials commissioned by or prepared for Buyer relating to or regarding the Property ( “Buyer's Reports”), at no cost to Seller.
5. Seller's Deliveries. Within five ( 5) business days following the Effective D ate, Seller shall deliver to Buyer , whether electronically or otherwise, the materials described on Exhibit F, which shall contain copies of documents in Seller's possession or control, or to which 16498.10023\40972400.1
4 Seller has access (collectively, the “ Seller's Deliveries ”). Seller makes no representation whatsoever about the content, accuracy, completeness or value of any of Seller's Deliveries, except as set forth in this Agreement. All Seller's Deliveries will be provided to Buyer without warranty from Seller regarding the accuracy or completeness of the information contained therein except as expressly set forth in this Agreement, and such documents may or may not be assignable to Buyer.
The delivery of such reports and studies shall be subject to the proprietary rights of any engineer or other consultant preparing the same and any limitations on use imposed by them. Buyer assumes all risk of reviewing and understanding any and all information contained in Seller's Deliveries. Seller shall deliver a Natural Hazards Disclosure Report with Seller's Deliveries.
6. Conditions to Seller's Obligations. Seller's obligations hereunder, including, but not limited to, its obligation to consummate the purchase transaction provided for herein, are subject to the satisfaction of each of the following conditions, each of which is for the sole benefit of Seller and may be waived by Seller in writing in Seller’s sole and absolute discretion:
(a) Buyer shall not be in default under this Agreement beyond applicable notice and cure periods, or if no such period is provided, then if there is any default that extends more than ten days after Buyer’s receipt of written notice; provided if such default cannot be cured with reasonable diligence within ten days.
(b) Each representation and warranty made in this Agreement by Buyer shall be true and correct in all material respects at the time as of which the same is made and as of the Close of Escrow.
(c) Seller is duly authorized to execute the Grant Deed, Note, and Deed of Trust, and, if necessary, obtained final approval of the sale of surplus land by the California Department of Housing and Community Development (“HCD”). . (d) Buyer shall execute and deliver the Note and Deed of Tr ust, in the form approved by Seller, to Escrow Holder.
(e) Buyer shall execute and deliver the affordable housing covenant, based substantially on the draft attached hereto, as Exhibit G (“ Affordability Covenant”), to be recorded against the Property.
(f) Buyer shall execute and deliver a Declaration and Use Covenant, agreeable to Seller, based substantially on the draft attached hereto as Exhibit H (“Use Covenant”), to be recorded against the Property.
(g) Delivery of a binding commitment by a title insurance company acceptable to the Seller to issue a lender’s policy of Title Insurance with any endorsements the Seller may reasonably require, insuring the City in the principal amount of the Purchase Price, of the validity and priority of the Deed of Trust upon the Property, subject only to liens and matters of record approved by the Seller in writing.
(h) Buyer shall have provided the Seller with a copy of a resolution of the Buyer approving and authorizing execution of this Agreement and all documents contemplated hereby 16498.10023\40972400.1
5 on behalf of Buyer and with such other documentation required by the Seller regarding Buyer’s creation, status and authority to enter into this transaction.
7. Conditions Precedent to Closing. The following are conditions precedent to Buyer's obligation to pu rchase the Property (the “ Conditions Precedent ”). The Conditions Precedent are intended solely for the benefit of Buyer and may be waived only by Buyer in writing in Buyer’s sole and absolute discretion. In the event any Condition Precedent is not satisfied, Buyer may, in its sole and absolute discretion, terminate this Agreement, subject to the provisions of Section 8.
(a) Buyer's inspection, review and approval, within the Feasibility Period, of all of the following:
(i) The physical characteristics and condition of the Property (including without limitation the condition of the soils);
(ii) Seller's Deliveries; and,
(b) Escrow Holder shall be unconditionally committed to issue the Title Policy to Buyer upon the Closin g in the form and with such exceptions and endorsements as have been approved, or are deemed approved, by Buyer as provided in Section 3 above. (c) Seller shall have complied with all of Seller's duties and obligations contained in this Agreement and all of Seller's representations and warranties contained in or made pursuant to this Agreement shall have been true and correct when made and shall be true and correct as of the Closing Date.
8. Default. If the sale of the Property pursuant to this Agreement is not consummated, then Seller shall retain the Initial Deposit and Buyer shall provide Seller with copies of all reports prepared in connection with this Agreement. Buyer and Seller retains and reserves all remedies at law and equity for a breach of this Agreement.
9. Escrow; Closing, Prorations.
(a) Upon mutual execution of this Agreement, the parties hereto shall deposit an executed counterpart of this Agreement with Escrow Holder and this Agreement shall serve as instructions to Escrow Holder for consummation of the purchase contemplated hereby. Seller and Buyer shall execute such supplemental Escrow instructions as may be appropriate to enable Escrow Holder to comply with the terms of this Agreement, provided such supplemental Escrow instructions are not in conflict with this Agreement as it may be amended in writing from time to time. In the event of any conflict between the provisions of this Agreement and any supplementary Escrow instructions signed by Buyer and Seller, the terms of this Agreement shall control. (b) The Closing shall take place (the “Closing Date”) on or before the date that is twenty-five (25) days following the expiration of the Feasibility Period or approval from HCD, if necessary, whichever is later, or as may be extended by mutual written agreement of the Parties. 16498.10023\40972400.1
6 (c) At or before the Closing, Seller shall deliver to Escrow Holder or Buyer the following:
(i) the duly executed and acknowledged Grant Deed for the Property and the duly executed Bill of Sale;
(ii) Seller’s duly executed and acknowledged Note;
(iii) Seller’s duly executed and acknowledged Deed of Trust; (iv) a duly executed affidavit that Seller is not a “foreign person” within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986 in the form attached as Exhibit I and incorporated herein by this reference together with a duly executed non- foreign person affidavit and evidence that Seller is exempt from the withholding obligations imposed by California Revenue and Taxation Code Sections 18805, 18815, and 26131; (v) evidence re asonably acceptable to Escrow Holder that the documents delivered by Seller have been duly authorized and executed on behalf of Seller and constitute valid and binding obligations of Seller.
(vi) any other documents which the Escrow Holder may reasonably require from Seller in order to close Escrow which do not increase Seller's liability or obligations hereunder;
(vii) a closing statement in form and content satisfactory to Buyer and Seller (the “Closing Statement”) duly executed by Seller; and (viii) any other instruments, records or correspondence called for hereunder which have not previously been delivered.
(d) At or before the Closing, Buyer shall deliver to Escrow Holder or Seller the following:
(i) the Closing Statement, duly executed by Buyer;
(ii) Buyer’s executed and duly acknowledged Note;
(iii) Buyer’s executed and duly acknowledged Deed of Trust; and (iv) Buyer’s executed and duly acknowledged Affordability Covenant; (v) Buyer’s executed and duly acknowledged Use Covenant; (vi) Proof of insurance required by this Agreement or the Deed of Trust; and
(vii) evidence reasonably acceptable to Escrow Holder that the documents delivered by Buyer have been duly authorized and executed on behalf of Buyer and constitute valid and binding obligations of Buyer.
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7 (e) Seller and Buyer shall each deposit such other instruments as are reasonably required by Escrow Holder or otherwise required to close the Escrow and consummate the purchase of the Property in accordance with the terms hereof. (f) The following are to be paid by Buyer or Seller or apportioned as of the Closing Date, as follows:
(i) General real property taxes for the year in which Closing occurs together with assessments, property operating expenses, utilities and other recurring costs relating to the Property shall be apportioned as of the Closing Date on the basis of a thirty (30)-day month. (ii) Seller and Buyer shall each pay one- half (1/2) of all Costs and expenses of Escrow incurred in this transaction, including:
(1) All sales, use and documentary transfer taxes ;
(2) the lender’s Title Insurance policy wit h any endorsements Seller shall reasonably require;
(3) The Escrow fees, recording fees and related expenses; (4) all other costs of escrow shall be paid equally by Buyer and Seller.
(iii) Seller shall pay the premium for a standard ALTA coverage owner's policy of title insurance and Buyer shall pay the premium in excess of the standard coverage for any extended ALTA coverage if desired, and
(iv) The provisions of this Subparagraph (f) shall survive the Closing.
10. Representations, Warranties and Covenants of Seller . As of the date hereof and again as of Closing, Seller represent and warrants to Buyer as follows:
(a) Seller is a California municipal corporation, duly organized, validly existing and in good standing under the laws of the State of California. This Agreement and all documents executed by Seller which are to be delivered to Buyer at the Closing are and at the time of Closing will be duly authorized, executed and delivered by Seller, are and at the time of Closing will be legal, valid and binding obligations of Selle r enforceable against Seller in accordance with their respective terms. Seller has obtained all necessary authorizations, approvals and consents to the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.
(b) No Action. No attachments, execution proceedings, assignments for the benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings are pending against Seller, nor are any such proceedings contemplated by Seller; (c) No Representations as to Property. There are no representations, agreements, arrangements, or circumstances, oral or written, between the parties relating to the 16498.10023\40972400.1
8 subject matter contained in this Agreement that are not fully expressed in the Agreement, and Seller has not made and does not make any representation or warranty, express or implied, concerning any matter or thing affecting or relating to the Property, including but not limited to its fitness for a particular use, its physical condition or any other matter; and (d) Sale “AS-IS”. Subject to Seller's representations and warranties contained herein, Buyer's election to purchase the Property will be based upon and will constitute evidence of Buyer's knowledge of the Property from use and occupation under the License, and Buye r’s independent investigation of the Property, its use, development potential and suitability for Buyer's intended use, including (without limitation) the following: the feasibility of developing the Property for the purposes intended by Buyer and the conditions of approval for any subdivision map; the size and dimensions of the Property; the availability, cost and adequacy of water, sewerage and any utilities serving or required to serve the Property; the presence and adequacy of current or required infra structure or other improvements on, near or affecting the Property; any surface, soil, subsoil, fill or other physical conditions of or affecting the Property, such as climate, geological, drainage, air, water or mineral conditions; the condition of title to the Property; the existence of governmental laws, statutes, rules, regulations, ordinances, limitations, restrictions or requirements concerning the use, density, location or suitability of the Property for any existing or proposed development thereof i ncluding but not limited to zoning, building, subdivision, environmental or other such regulations; the necessity or availability of any general or specific plan amendments, rezoning, zoning variances, conditional use permits, building permits, environmental impact reports, parcel or subdivision maps and public reports, requirements of any improvement agreements; requirements of the California Subdivision Map Act, and any other governmental permits, approvals or acts (collectively “Permits”); the necessity or existence of any dedications, taxes, fees, charges, costs or assessments which may be imposed in connection with any governmental regulations or the obtaining of any required Permits; the presence of endangered plant or animal species upon the Property; and all of the matters concerning the condition, use, development or sale of the Property. Seller will not be liable for any loss, damage, injury or claim to any person or property arising from or caused by the development of the Property by Buyer.
Except with respect to a default by Seller hereunder (including a breach of Seller's warranties and representations), Buyer at the Close of Escrow expressly waives its rights granted under California Civil Code Section 1542, which provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING
THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST
HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT
WITH THE DEBTOR.”
Buyer's Initials: ________ Seller's Initials: ________. (e) To the actual knowledge of the person most knowledgeable for the Seller, which is Ray Ebert, Deputy City Manager / Administrative Services, who under no circumstance has been or will be under a duty to investigate, Seller represents and warrants:
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9 (i) Except for the License, there are no agreements, contracts or leases affecting the Property (including, without limitation, any contracts for the use, occupancy, license, sale or lease of the Property or any portion thereof, or any brokerage, management agreement, utility or service contracts), (ii) Seller has not granted, and has no knowledge of, any rights of first refusal, options to purchase, or rights to lease, license, use or occupy the Property ( or any portion thereof), and (iii) Seller shall, on or before the Closing, at its sole expense, terminate any and all agreements, contracts and leases (if any)(including, without limitation, all contracts to which Seller or any of its affiliates is a party ) that in any manner affect or pertain to the Property unless and to the extent that Buyer notifies Seller in writing that it has expressly agreed to assume a particular contract. (ii) Seller has received no notice of any violations of any laws, rules, regulations, codes or ordinances of any governmental authority with respect to the Property (including, without limitation, any laws, rules, regulations, codes or ordinances pertaining to environmental matters or conditions) that have not been cured.
(iii) Seller acknowledge s that Buyer intends to redevelop the Property. Seller agrees to reasonably cooperate with Buyer, in connection with Buyer ’s pursuit of any entitlements or other governmental or quasi -governmental approvals with respect to the Property, which cooperation, shall include Seller’s execution of such applications and other instruments requested by Buyer and acceptable to Seller, in Seller’s reasonable discretion, in connection with Buyer ’s efforts to pursue entitlements or other governmental or quasi-governmental approvals.
11. Representations, Warranties and Covenants of Buyer. Buyer hereby represents and warrants to Seller as follows:
(a) Buyer is a nonprofit religious corporation duly organized, validly existing and in good standing under the laws of the State of California. This Agreement and all documents executed by Buyer which are to be delivered to Seller at the Closing are and at the time of Closing will be duly authorized, executed and delivered by Buyer, are and a t the time of Closing will be legal, valid and binding obligations of Buyer enforceable against Buyer in accordance with their respective terms, and do not and at the time of Closing will not violate any provision of any agreement or judicial order to whic h Buyer is subject. Buyer has obtained all necessary authorizations, approvals and consents to the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby.
(b) Buyer warrants that Buyer is a sophisticated owner an d buyer of real property, familiar and experienced with requirements for the development of real property. Buyer has examined the Property or will have done so by Closing, is or will be familiar with its physical condition, and accepts the Property in an “AS-IS” condition. (c) Buyer acknowledges that it is presently has access to the Property in accordance with the License and has knowledge about the conditions of the Property. (d) Buyer has conducted or will conduct an independent investigation with respect to zoning and subdivision laws, ordinances, resolutions, and regulations of all 16498.10023\40972400.1
10 governmental authorities having jurisdiction over the Property, and the use and improvement of the Property and is, or at Closing will be, satisfied with the results of such investigation. (e) Buyer has obtained Conditional Use Permit #22-014 and approval of Design Review #22-024 regarding potential development of the Property. Buyer understands, agrees, represents and warrants that this Agreement does not constitute approval by Seller , the City of Fontana, or any of its offi cers, employees, or agents, of any additional development or activities on the Property. Any future activities on or development of the Property will be subject to all necessary approvals, review, and process , incl uding any environmental review under the California Environmental Quality Act (“CEQA”) . Except for the conditional use permit and approval of design review referenced herein, Buyer agrees and acknowledges that Seller, the City of Fontana, and its officers, employees or agents, have not made and specifically disclaim any representation or warranty , express or implied, about the approval of any such activities or development or the suitability of the Property for any particular purpose. (f) Buyer agrees to all covenants, conditions, and restrictions set forth in Paragraph 6(e)-(f) and the Affordability Covenant attached as Exhibit G and the Use Covenant attached as Exhibit H.
(g) The Property is being sold “AS-IS” and with all faults.
12. Environmental Matters /Release. As used in this Agreement, “ Hazardous Materials” includes petroleum, asbestos, radioactive materials or substances defined as '“hazardous substances,” “hazardous materials” or “toxic substances” (or words of similar import) in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Section 9601, et seq.), the Hazardous Materials Transportation Act (49 U.S.C. Section 1801, et seq.), the Resource Cons ervation and Recovery Act (42 U.S.C.
Section 6901, et seq.), and under the applicable laws of California. Buyer must rely on its own investigation and not on any representation by Seller regarding Hazardous Materials. Buyer shall rely solely upon its own investigation and inspection of the Property and the improvements thereon and upon the aid and advice of Buyer's independent expert(s) in purchasing the Property, and shall take title to the Property without any warranty, express or implied, by Seller or any employee or agent of Seller. Buyer acknowledges that this Agreement allows Buyer, or its employees or agents, to make any such investigation and perform any appropriate environmental site assessment of the Property, subject to Seller’s consent, which shall not be unreasonably withheld. Seller makes no representations regarding Hazardous Materials in, on or under the Property, except as expressly set forth below. Seller's knowledge and disclosures regarding Hazardous Materials are limited to the contents of Seller's Deliveries and the following representation and warranty: To the actual knowledge of the person most knowledgeable for the Seller, which is Ray Ebert, Deputy City Manager/Administrative Services, who under no circumstance has been or will be under a duty to investigate, Seller has not used, generated, manufactured, stored or disposed any hazardous materials, hazardous substances or other environmental contaminants in, at, on, under or about the Property or transported any H azardous Materials to or from the Property in violation of any applicable environmental laws , and there has been no discharge, migration or release of any Hazardous Materials from, into, on, under or about the Property in violation of any applicable environmental laws.
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11 Accordingly, except for a breach of the representation and warranty set forth above, Buyer hereby expressly waives and relinquishes any and all rights and remedies Buyer may now or hereafter have against Seller, whether known or unknown, with respect to any past present, or future presence of Hazardous Materials on, under or about the Property or with respect to any past, present or future violations of any rules, regulations or laws, now or hereinafter enacted, regulating or governing use, handling, storage or disposable of Hazardous Materials, including, without limitation (i) any and all remedies Buyer may now or hereafter have under the Comprehensive Environmental Response Compensation and Liability Act of 1980 (“CERCLA”), as amended, and any similar law, rul e or regulation, (ii) any and all rights Buyer may now or hereafter have against Seller under the Carpenter -Presley-Tanner Hazardous Substance Account Act (California Health and Safety Code, Section 25300 et seq.), as amended and any similar law, rule or regulation, and (iii) any and all claims, whether known or unknown, now or hereafter existing, with respect to the Property under Section 107 of CERCLA (42 U.S.
C.A. § 9607).
BUYER HEREBY ACKNOWLEDGES THAT IT HAS READ AND IS
FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542 (“SECTION 1542”), WHICH IS SET FORTH BELOW
“A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT
THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE
DEBTOR”
BY INITIALING BELOW, BUYER HEREBY WAIVES THE
PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH
THE MATTERS WHICH ARE THE SUBJECT OF THE FOREGOING
WAIVERS AND RELEASES.
_______________
(Buyer's Initials)
13. Continuation and Survival . All representations, warranties and covenants by the respective parties contained herein or made in writing pursuant to this Agreement are intended to and shall be deemed made as of the date of this Agreement or such writing and again at the Closing, shall be deemed to be material, and unless expressly provided to the contrary shall survive the execution and delivery of this Agreement, the Grant Deed and the Closing.
14. Prevailing Wage.
Buyer, for itself, its successors, and assigns, agrees, covenants, and warrants that the development of the Property, if any, shall comply with all applicable federal and state labor laws (including, without limitation, the requirement under California law to pay prevailing wages and hire apprentices), and all obligations as set forth herein. 16498.10023\40972400.1
12 City makes no representations concerning prevailing wages in compliance with California Labor Code Section 1770 et seq.
Buyer acknowledges and agrees that it shall be independently responsible for reviewing the applicable laws and regulations with respect to the payment of prevailing wages and complying therewith. Buyer shall bear all risks of payment or non- payment of prevailing wages under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar law.
The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the construction and development of the Property by Buyer, its successors or assigns. Buyer shall be solely responsible for determining and effectuating compliance with such laws.
BUYER, ON BEHALF OF ITSELF, ITS SUCCESSORS, AND ASSIGNS, WAIVES
AND RELEASES SELLER FROM ANY RIGHT OF ACTION THAT MAY BE AVAILABL E TO BUYER PURSUANT TO LABOR CODE SECTION 1781 OR THE DAVIS BACON ACT.
RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 14, BUYER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542, WHICH READS AS FOLLOWS:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE
CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR OR RELEASED PARTY.
INITIALS. BY INITIALING BELOW, BUYER KNOWINGLY AND
VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY WITH THE
MATTERS WHICH ARE THE SUBJECT OF THE FOREGOING WAIVERS AND RELEASES:
_______________
(Buyer's Initials)
15. Indemnity.
Buyer agrees to indemnify Seller and the Property against, and to hold and save Seller and the Property harmless from, all claims, demands, suits, actions, damages, obligations, liabilities, losses, costs and expenses, including but not limited to attorneys' fees and court costs, related to the implementation of this Agreement; provided, however, that Buyer will not be obligated to indemnify Seller with respect to its own negligence. The foregoing indemnity shall survive termination of this Agreement. Buyer shall not suffer or permit any mechanic's or materialmen's or other lien to stand against the Property in connection with any labor, materials or services furnished or claimed to have been furnished by or on behalf of Buyer in connection with or as a result of any Inspections. If any such lien shall be filed against the Property, Buyer shall cause such lien to be discharged or bonded within thirty (30) days after such filing. Following any 16498.10023\40972400.1
13 Inspections Buyer shall restore the Property to substantially its physical condition as existed prior to such inspection (except for any changes to the Property caused by Seller, or its agents or employees). Prior to Buyer allowing any agent or consultant on the Property in accordance with this Agreement, Buyer or it s consultant shall at its sole cost obtain a policy of liability insurance with a combined single limit in an amount not less than One Million Dollars ($1,000,000); Seller shall each be named an additional insured on said policy; and Buyer or its consultants shall furnish to Seller a certificate of insurance confirming such coverage. This indemnity shall be in addition to any indemnity obligation under the License.
16. Insurance. For the term of the Note, Borrower shall maintain the following insurance coverage:
(a) Comprehensive General Liability Insurance endorsed for property- operations, products/completed operations and contractual liability, in the amount of at least $1,000,000 for any occurrence, $2,000,000 annual aggregate and $1,000,000 property damage. (b) Comprehensive Auto Liability Insurance endorsed for all owned and non- owned vehicles with a combined single limit of at least $1,000,000 per occurrence. (c) Workers Compensation Insurance in an amount and form to meet all applicable requirements of the Labor Code of the State of California and which specifically covers all persons providing services on behalf of Buyer, its employees, agents, or its affiliates under this Agreement and all risks to such persons and employer's liability insurance with a limit of no less than $1,000,000 per employee and $1,000,000 per occurrence. (d) Professional Liability Errors & Omissions in the amount of $1,000,000 for any occurrence and $1,000,000 aggregate.
(e) Property insurance covering the development of the Property in a manner consistent with the Use Covenant , in a form appropriate for the nature of such property and any improvements, covering all risks of loss, excluding earthquake, for one hundred percent (100%) of the replacement value, with deductible, if any, acceptable to the City, naming the City as an additional insured, as its interests may appear. Flood insurance shall be obtained if required by applicable federal regulations.
(f) The Borrower shall cause any general contractor, agent, or subcontractor working on the Property to maintain insurance of the types and in at least the minimum amo unts described in subsections (a), (b), and (c) above, except that the limit of liability for comprehensive general liability insurance for subcontractors shall be Two Million Dollars ($2,000,000), and shall require that such insurance shall meet all of the general requirements of subsections ( f) and (g), below. Liability and Comprehensive Automobile Liability insurance to be maintained by such contractors and agents pursuant to this subsec tion shall name as additional insureds the City, its officers, agents, employees and members of the City Council (g) The required insurance shall be provided under an occurrence form, and Borrower shall maintain the cove rage described in subsections (a ) through ( d) continuously so long as the Note is outstanding. Should any of the required insurance be provided under a form of coverage that includes an annual aggregate limit or provides that claims investigation or legal 16498.10023\40972400.1
14 defense costs be included in such annual aggregate limit, such annual aggregate limit shall be three times the occurrence limits specified above.
(h) Comprehensive General Liability, Comprehensive Automobile Liability, Workers Compensation, and Professional Liability Errors & Omissions, and Property insurance policies shall be endorsed to name as an additional insured the City, and its officers, agents, employees and members of the City Council.
All policies and bonds shall (i) be endorsed to provide thirty (30) days prior written notice of cancellation (including without limitation for non-payment of premium), reduction in coverage, any material change in said policy, or intent not to renew to the address established for notices to the City, (ii) contain an agreement that such policies are primary and non -contributing with any insurance that may be carried by City, (iii) contain a provision that no act or omission of Borrower shall affect or limit the obligation of the insurance carrier to pay the amount of loss sustained, and (iv) contain a waiver by the insurer of all rights of subrogation against City and its authorized parties in connection with any loss or damage thereby insured against.
17. Condemnation.
(a) In the event a governmental entity commences eminent domain proceedings to take any portion of the Property after the date hereof and prior to the Closing, then Buyer shall have the option to terminate this Agreement by written notice to Seller within ten ( 10) business days after Buyer first learns of such commencement. In the event of any such term ination, the Earnest Money, together with all interest, shall be returned to Buyer. Buyer and Seller shall each be liable for one -half of any escrow fees or charges, and neither party shall have any further liability or obligation under this Agreement.
(b) In the event a governmental entity commences eminent domain proceedings to take any part of the Property after the date hereof and prior to the Closing and this Agreement is not terminated pursuant to Section 17(a), then the Closing shall occur as scheduled notwithstanding such proceeding; provided, however, that Seller's interest in all awards arising out of such proceedings (except for any award attributable to the loss of Seller's business or income, Seller's personal property, or the property of any tenant of the Property) shall be assigned to Buyer as of the Closing or credited to Buyer if previously received by Seller. Seller's obligations pursuant to this Section 15(b) shall survive the Closing.
18. Possession. Possession of the Property shall be delivered to Buyer on the Closing Date free of any occupant or property not being conveyed to Buyer as provided hereunder.
19. Seller's Cooperation with Buyer. At no cost to Seller, Seller shall cooperate and do all acts as may be reasonably required or requested by Buyer, at no additional cost to Seller, with regard to the fulfillment of any Condition Precedent. Seller hereby authorizes Buyer and its agents to make all inquiries with and applications to any third party, including any governmental authority, as Buyer may reasonably require to complete its due diligence and satisfy the Conditions Precedent.
20. No Brokers and Finders. Neither party has had any contact or dealings regarding the Property, or any communication in connection with the subject matter of this transaction, 16498.10023\40972400.1
15 through any real estate broker or other person who can claim a right to a commission or finder's fee in connection with the sale contemplated herein. In the event that any such broker or finder claims a commission or finder's fee based upon any contact, dealings or communication, the party through whom the broker or finder makes its claim shall be responsible for said commission or fee and all costs and expenses (including, without limitation, reasonable attorneys' fees) incurred by the other party in defending against the same. The party through whom any such other broker or finder makes a claim shall hold ha rmless, indemnify and defend the other party hereto, its successors and assigns, agents, employees, officers and directors, and the Property from and against any and all obligations, liabilities, claims, demands, liens, encumbrances and losses (including, without limitation, attorneys' fees), arising out of, based on, or incurred as a result of such claim. The provisions of this Section 20 shall survive the Closing or termination of this Agreement.
21. Professional Fees. In the event legal action is commenced to enforce or interpret any of the terms or provisions of this Agreement, the prevailing party in such action shall be entitled to an award of reasonable attorney's fees and costs incurred in connection with the prosecution or defense of said action. In addition, the prevailing party shall be entitled to recover any actual accounting, engineering or other professional fees reasonably incurred in said action or proceeding.
22. Publicity and Confidentiality. Buyer acknowledges that Seller is a public entity and that this Agreement shall be a matter of public record and available to the public under the Public Records Act.
23. Miscellaneous.
(a) Notices. Any notice, consent or approval required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been given upon (i) hand delivery, (ii) one business day after being deposited with Federal Express or another reliable overnight courier service for next day delivery, (iii) upon facsimile transmission (except that if the date of such transmission is not a business day or if such transmission is made after 5:00 p.m. on a business day, then such notice shall be deemed to be given on the first business day following such transmission), or (iv) two business days after being deposited in the United States mail, registered or certified mail, postage prepaid, return receipt required, and addressed as follows (or such other address as either party may from time to time specify in writing to the other in accordance herewith):
If to Seller: The City of Fontana
Attn: Matt Ballantyne, City Manager
8353 Sierra Avenue
Fontana, CA 92335
Phone: (909) 350-7654
Email: [email protected]
With a copy to: Best Best & Krieger LLP
Attn: Ruben Duran, City Attorney
2855 E. Guasti Rd.,Suite 400
16498.10023\40972400.1
16 Ontario, CA 91761
Phone: (213) 787-2569
E-Mail: [email protected]
If to Buyer: Water of Life Community Church
Attn: Jim Kensinger
14418 Miller Avenue, Suite K
Fontana, CA 92336
Phone: (909) 463-0103 x4162
Email [email protected]
With a copy to: The Opus Law Firm
Attn: Justin White
514 Via de la Valle, Suite 203
Solana Beach, CA 92075
Phone: 877.885.4564 ext. 101
Email [email protected]
To Escrow Holder: _______________________________
Attn: __________________________
_______________________________
_______________________________
Phone: _________________________
Email ___________________________
(b) Successors and Assigns. Buyer shall have the right to assign this Agreement to any entity controlling, controlled by or under common control with Buyer without Seller's consent or approval, and otherwise Buyer shall have the r ight to assign this Agreement to any entity subject to Seller's prior approval, which approval shall not be unreasonably withheld, conditioned or delayed. Any such assignee shall assume all obligations of Buyer hereunder; however, Buyer shall remain liabl e for all obligations hereunder. Seller shall have the right to assign this Agreement. Except as otherwise permitted by this paragraph, neither this Agreement nor the rights of either party hereunder may be assigned by either party. This Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors, heirs, administrators and assigns.
(c) Amendments. This Agreement may be amended or modified only by a written instrument executed by Seller and Buyer.
(d) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California.
(e) Construction. Headings at the beginning of each Section and subparagraph are solely for the convenience of the parties and are not a part of the Agreement. This Agreement shall not be construed as if it had been prepared by one of the parties, but rather as if both parties 16498.10023\40972400.1
17 had prepared the same. Unless otherwise indicated, all references to Sections and subparagraphs are to this Agreement. All exhibits referred to in this Agreement are attached and incorporated by this reference.
(f) No Joint Venture . This Agreement shall not create a partnership or joint venture relationship between Buyer and Seller.
(g) Legal Advice . Each party represents and war rants to the other the following: they have carefully read this Agreement and all documents referenced herein and made part of this transaction, and that in signing this Agreement and any other related document , they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters relating to this Agreement , or have knowingly chosen not to consult legal counsel as to this Agreement or any related matter ; and, they have freely signed this Agreement, the Note, Deed of Trust, Covenant, and all related documents, without any reliance upon any agreement, promise, statement or representation by or on behalf of the other party, or their respective agents, employees, or attorneys, except as specifically set forth herein, and without duress or coercion, whether economic or otherwise. (h) Merger of Prior Agreements . This Agreement and the exhibits attached hereto constitute the entire agreement between the parties and supersede all prior agreements and understandings between the parties relating to the subject matter hereof, including without limitation, any letters of intent previously executed or submitted by either or both of the parties hereto, which shall be of no further forc e or effect upon execution of this Agreement.
Notwithstanding the foregoing, the License will continue in effect until Closing, at which point the License will be terminated, except any obligations surviving expiration of the License shall continue unless contrary to this Agreement.
(i) Time of the Essence. Time is of the essence of this Agreement. As used in this Agreement, a “business day” shall mean a day which is not a Saturday, Sunday or recognized federal or state holiday. If the last date for perfor mance by either party under this Agreement occurs on a day which is not a business day, than the last date for such performance shall be extended to the next occurring business day.
(j) Severability. If any provision of this Agreement, or the application thereof to any person, place, or circumstance, shall be held by a court of competent jurisdiction to be invalid, unenforceable or void, the remainder of this Agreement and such provisions as applied to other persons, places and circumstances shall remain in full force and effect. (k) Further Assurances. Each of the parties shall execute and deliver any and all additional papers, documents and other assurances and shall do any and all acts and things reasonably necessary in connection with the performance of their obligations hereunder and to carry out the intent of the parties.
(l) Exhibits. All exhibits attached hereto and referred to herein are incorporated herein as though set forth at length.
(m) Captions. The captions appearing at the commencement of the sections and paragraphs hereof are descriptive only and for convenience in reference. Should there be any 16498.10023\40972400.1
18 conflict between any such caption and the section at the head of which it appears, the section and paragraph and not such caption shall control and govern in the construction of this Agreement. (n) No Obligation To Third Parties. Execution and delivery of this Agreement shall not be deemed to confer any rights upon, directly, indirectly or by way of subrogation, nor obligate either of the parties hereto to, any person or entity other than each other. (o) Waiver. The waiver by any party to this Agreement of the breach of any provision of this Agreement shall not be deemed a continuing waiver or a waiver of any subsequent breach, whether of the same or another provision of this Agreement. (p) Interpretation. This Agreement has been negotiated at arm's length and between persons (or their representatives) sophisticated and knowledgeable in the matters dealt with in this Agreement. Accordingly, any rule of law (including California Civil Code § 1654 and any successor statute) or legal decision that would require interpretation of any ambiguities against the party that has drafted it is not applicable and is waived. The provisions of this Agreement shall be interpreted in a reasonable manner to effect the purpose of the parties and this Agreement. (q) Counterparts/Facsimile/.PDF Signatures. This Agreement may be executed in counterparts and when so executed by the Parties, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument that shall be binding upon the Parties, notwithstanding that the Parties may not be signatories to the same counterpart or counterparts. The Parties may integrate their respective counterparts by attaching the signature pages of each separate counterpart to a single counterpart. In order to expedite the transaction contemplated herein, facsimile or .pdf signatures may be used in place of original signatures on this Agreement. Seller and Buyer intend to be bound by the signatures on the facsimile or .pdf document, are aware that the other party will rely on the facsimile or .pdf signatures, and hereby waive any defenses to the enforcement of the terms of this Agreement based on the form of signature.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date written below.
SELLER:
CITY OF FONTANA.
a California municipal corporation
By: _______________________________________
Name: ___________________________________
Its: ______________________________________
Date: ____________________________________
16498.10023\40972400.1
19 Approved as to Form
City Attorney:_________________________
Date:_________________________________
BUYER:
WATER OF LIFE COMMUNITY CHURCH,
a California nonprofit religious corporation
By: _______________________________________
Name: ___________________________________
Its: ______________________________________
Date: ____________________________________
Approved as to Form
Buyer’s Attorney:_________________________
Date:_________________________________
16498.10023\40972400.1
EXHIBIT A
LEGAL DESCRIPTION
16498.10023\40972400.1
EXHIBIT B
PERSONAL PROPERTY
16498.10023\40972400.1
EXHIBIT C
PROMISSORY NOTE
$3,040,000.00 _______________, 2023
___________, California
THIS SECURED PROMISSORY NOTE (“Note”) is made on January ___, 2023 by WATER OF LIFE COMMUNITY CHURCH, a California nonprofit religious corporation (“Borrower”) to CITY OF FONTANA, a California municipal corporation (“ Lender”), to evidence a loan made by Lender to Borrower in the principal amount of Three Million and Forty Thousand Dollars ($3,040,000.00) (“Principal Amount”) The entire amount of unpaid principal, plus all accrued and unpaid interest and any costs or fees owing under this Note shall be due and payable in full on March 1, 2033 (“Maturity Date”). This Note is made in connection with a Purchase and Sale Agreement and Joint Escrow Instructions dated ____ ___, 2023 (“PSA”), a “Deed of Trust” dated _________, 2023 (“Deed of Trust”), Declaration and Use Covenant dated _________, 2023 (“Use Covenant”), and Affordability C ovenant dated ________, 2023 (“Covenant”).
This Note shall be subject to the following additional provisions:
1. Payment Covenant . For value received, Borrower promises to pay Lender, in legal tender of the United States of America, or at such other place as may be designated in writing by Lender, the Principal Amount, together with interest as set forth below.
2. Interest. Interest shall be computed based on a thirty (30) day month and a three hundred sixty (360) day year. Commencing on the date of this Note, interest on the outstanding principal balance due under this Note shall accrue at the rate of four percent (4%) per annum.
3. Payment.
(a) Interest Only Payments for Ten Years. Beginning March 1, 2023, and continuing on the first day of each month thereafter for a period of ten (10) years, Borrower shall make monthly interest only payments, based on an interest rate of four percent (4%) per annum, in the amount of Ten Thousand One Hundred and Thirty Three Dollars ($10,133). (b) BALLOON PAYMENT . THIS NOTE REQUIRES A BALLOON
PAYMENT OF THREE MILLION AND FORTY THOUSAND DOLLARS ($3,040,000.00) ON OR BEFORE MARCH 1, 2033 (“MATURITY DATE”), PLUS ANY ACCRUED INTEREST THEREON, WHICH IS DUE ON THE MATURITY DATE OF THIS NOTE. THE AMOUNT
OF THE BALLOON PAYMENT IS SUBJECT TO REDUCTION IN THE EVENT BORROWER PREPAYS ANY PRINCIPAL DUE UNDER THIS NOTE. LIKEWISE, THE
AMOUNT OF THE BALLOON PAYMENT IS SUBJECT TO INCREASE IN THE EVENT BORROWER BECOMES DELINQUENT IN BORROWER’S PAYMENTS UNDER THIS NOTE. CAUTION: LENDER SHALL GIVE BORROWER WRITTEN NOTICE, ACCORDING 16498.10023\40972400.1
2 TO THE TERMS OF CIVIL CODE SECTION 2966, AT LEAST 90 AND NOT MORE THAN 150 DAYS BEFORE THE BALLOON PAYMENT IS DUE. LENDER AND BORROWER ARE
AWARE THAT REFINANCING OF THE BALLOON PAYMENT MAY BE DIFFICULT OR
IMPOSSIBLE, DEPENDING ON CONDITIONS IN THE CONDIT IONAL MORTGAGE MARKETPLACE AT THAT TIME. THERE ARE NO ASSURANCES THAT NEW
FINANCING OR A LOAN EXTENSION WILL BE AVAILABLE WHEN THE BALLOON PREPAYMENT IS DUE. IN THE EVENT OF DEFAULT BY BORROWER: (A) LENDER
MAY HAVE TO REINSTATE AND/OR MAKE MONTHLY PAYMENTS ON ANY AND ALL
SENIOR ENCUMBRANCES (INCLUDING REAL PROPERTY TAXES) IN ORDER TO PROTECT LENDER’S SECURED INTEREST; (B) LENDER ’S RIGHTS ARE GENERALLY
LIMITED TO FORECLOSURE ON THE PROPERTY, PURSUANT TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 580b; AND (C) THE PROPERTY MAY LACK SUFFICIENT EQUITY TO PROTECT LENDER ’S INTERESTS IF THE PROPERTY DECREASES IN VALUE.
THIS NOTE IS SUBJECT TO SECTION 2966 OF THE CIVIL CODE, WHICH
PROVIDES THAT THE LENDER OF THIS NOTE SHALL GIVE WRITTEN NOTICE
TO THE TRUSTOR, OR HIS SUCCESSOR IN INTEREST, OF PRESCRIBED INFORMATION AT LEAST 90 AND NOT MORE THAN 150 DAYS BEFORE ANY BALLOON PAYMENT IS DUE.
4. Default. The occurrence of any of the following shall constitute an event of default under this Note:
(a) Borrower fails to pay any amount due hereunder within thirty (30) days of its due date and receipt of written notice; or
(b) Any default by Borrower under this Note, the Purchase and Sale Agreement, the Deed of Trust, or the Covenant which extends beyond applicable notice and cure periods, or if no such period is provided, then if there is any default that extends more than ten days after Borrower’s receipt of written notice; provided if such default cannot be cured with reasonable diligence within ten days; or
(c) Any default by Borrower under any other material obligation of Borrower recorded against the Property after the expiration of all applicable cure periods , which if uncured would result in a claim against the Property superior to the Deed of Trust.
Borrower shall not be considered in default under this Note until the expiration of all notice and cure periods provided to Borrower.
Upon the occurrence of any uncured event of default, or at any time thereafter, at the option of the Payee hereof, the entire unpaid principal and int erest owing on this Note shall become immediately due and payable. This option may be exercised at any time following any such event, and the acceptance of one or more installments thereafter shall not constitute a waiver of Payee’s option. Payee’s failure to exercise such option shall not constitute a waiver of such option with respect to any subsequent event. Payee’s failure in the exercise of any other right or remedy 16498.10023\40972400.1
3 hereunder or under any agreement which secures the indebtedness or is related thereto s hall not affect any right or remedy and no single or partial exercise of any such right or remedy shall preclude any further exercise thereof.
5. Default Interest Rate . At all times when Borrower is in default hereunder by reason of Borrower’s failure to pay principal due under this Note within applicable cure periods, the interest rate on the sums as to which Borrower is in default (including principal, if Payee has elected to declare it immediately due and payable), shall be the highest rate then allowed by law as of the date of the default or 10% whichever is lower.
6. Waivers. Borrower and any endorsers hereof and all others who may become liable for all or any part of this obligation, severally waive presentment for payment, demand and protest and notice of protest, and of dishonor and nonpayment of this Note, and expressly consent to any extension of the time of payment hereof or of any installment hereof, to the release of any party liable for this obligation, and any such extension or release may be made without notice to any of said parties and without any way affecting or discharging this liability.
7. Security. Borrower's obligations under this Note are secured by that certain Deed of Trust with Assignment of Rents, of even date herewith, made by Borrow er in favor of Lender (the “Deed of Trust”), granting Lender a first priority lien against the fee interest in that certain real property described in the Deed of Trust (the “Property”).
8. Prepayment. Borrower may prepay the entire amounts outstanding hereunder without penalty or premium.
9. Application of Payments. Any payments made under this Note shall be applied in the following order: (a) to the repayment of expenses advanced by Lender under this Note or under the Deed of Trust; (b) to a ccrued interest payable under this Note; and (c) to principal payable under this Note.
10. Legal Costs. If any party to this Note shall take any action to enforce this Note or bring any action or commence any proceeding for any relief against any other party, declaratory or otherwise, arising out of this Note, the losing party shall pay to the prevailing party a reasonable sum for attorneys' and experts' fees and costs incurred in taking such action, bringing such suit and/or enforcing any judgment granted therein, all of which shall be deemed to have accrued upon the commencement of such action and shall be paid whether or not such action is prosecuted to judgment. Any judgment or order entered in such action shall contain a specific provision providing for t he recovery of attorneys' and experts' fees and costs incurred in enforcing such judgment. The amount of attorneys' and experts' fees and costs due hereunder shall be determined by a court of competent jurisdiction and not by a jury. For the purposes of this Section 16, attorneys' and experts' fees and costs shall include, without limitation, fees and costs incurred in the following: (a) post-judgment motions; (b) contempt proceedings; (c) garnishment, levy, and debtor and third party examinations; (d) discovery; and (e) bankruptcy litigation; and (f) appeals.
11. Dates. In the event that any date specified in this Note falls on Saturday, Sunday or other day on which public agencies and major banks are not open for business (each a “ Non- 16498.10023\40972400.1
4 Business Day”), such date shall be deemed to be the succeeding business day. For purposes of this Note, a “business day” shall mean a day other than a Non-Business Day.
12. Notice. Any notice required to be provided in this Note shall be given in writing and shall be sent (a) for personal delivery by a delivery service that provides a record of the date of delivery, the individual to whom delivery was made, and the address where delivery was made; (b) by first-class certified United States mail, postage prepaid, return receipt requested; or (c) by a nationally recognized overnight courier service, marked for next day business delivery. All notices shall be addressed to the party to whom such notice is to be given at the address stated in this Note or to such other address as a party may designate by written notice to the other. All notices shall be deemed effective on the earliest of (a) actual receipt; (b) rejection of delivery; (c) if sent by certified mail, the third day on which regular United States mail delivery service is provided after the day of mailing or, if sent by overnight delivery service, on the next day on which such service makes next-business-day deliveries after the day of sending. All notices to Borrower shall be sent to the address set below Borrower's signature. All notices sent to Lender shall be sent to:
Water of Life Community Church
ATTN:
ADDRESS
With a copy to:
The Opus Law Firm
Attn: Justin White
514 Via de la Valle, Suite 203
Solana Beach, CA 92075
13. Legal Advice. Each party represents and warrants to the other the following: they have carefully read this Note and all documents referenced herein and made part of this transaction, and that in signing this Note and any other related document, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters relating to this Note, or have knowingly chosen not to consult legal counsel as to this Note or any related matter; and, they have freely signed this Note, and all related documents, without any reliance upon any agreement, promise, statement or representation by or on behalf of the other party, or their respective agents, employees, or attorneys, except as specifically set forth herein, and without duress or coercion, whether economic or otherwise.
14. Interpretation. This Note has been negotiated at arm's length and between persons (or their representatives) sophisticated and knowledgeable in the matters dealt with in this Note.
Accordingly, any rule of law (including California Civil Code § 1654 and any successor statute) or legal decision that would require interpretation of any ambiguities against the party that has drafted it is not applicable and is waived. The provi sions of this Note shall be interpreted in a reasonable manner to effect the purpose of the parties and this Note.
16498.10023\40972400.1
5 15. Governing Law; Venue. This Note shall be construed and enforced in accordance with the laws of the State of California, without regard to without regard to principles of conflict of laws. Venue for any action relating to this Note, shall be in San Bernardino County.
LENDER
CITY OF FONTANA.
a California municipal corporation
_____________________________
By:
Name:
Its:
Date:
Approved as to Form
City Attorney:_________________________
Date:_________________________________
BORROWER
WATER OF LIFE COMMUNITY CHURCH,
a California nonprofit religious corporation
__________________________________
_______________________, Member
Address: _______________________
Approved as to Form
Buyer’s Attorney:_________________________
Date:_________________________________
16498.10023\40972400.1
6 16498.10023\40972400.1
EXHIBIT D
DEED OF TRUST
RECORDING REQUESTED BY
When Recorded Mail To:
SPACE ABOVE THIS LINE FOR RECORDER'S USE
DEED OF TRUST AND ASSIGNMENT OF RENTS
This DEED OF TRUST AND ASSIGNMENT OF RENTS, made January __, 2023, between WATER OF LIFE COMMUNITY CHURCH, ____________________________, herein called TRUSTOR, whose address is: _________________________________. __________________________________, a California corporation, herein called TRUSTEE, and
CITY OF FONTANA, a California municipal corporation, herein called BENEFICIARY, WITNESSETH: That Trustor grants to Trustee in Trust, with Power of Sale, that property described in Exhibit A, attached hereto, together with the rents, issues, and profits thereof.
For the Purpose of S ecuring (1) Payment of the sum of Three Million and Forty Thousand Dollars ($3,040,000.00) with interest thereon according to the terms of a promissory note or notes of even date herewith made by Trustor, payable to order of Beneficiary, and extensions or renewals thereof, and (2) the performance of each agreement of Trustor incorporated by reference or contained herein, (3) Payment of additional sums and interest thereon which may hereafter be loaned to Trustor, or his successors or assigns, when evidenced by a promissory note or notes reciting that they are secured by this Deed of Trust.
BALLOON PAYMENT: The note securing this Deed of Trust is subject to Section 2966 of the Civil Code which provides that the holder of the note shall give written notice to the Trustor, or his successor in interest, of prescribed information at least 90 and not more than 150 days before any balloon payment is due.
A. To protect the security of this Deed of Trust, Trustor agrees:
(1) To keep said property in good condition and repair; not to remove or demolish any building thereon; to complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged or destroyed thereon and to pay when due all claims for labor performed and materials furnished therefor; to comply with all laws affecting said property or requiring any alterations or improvements to be made thereon; not to commit, suffer or permit any act upon said property in violation of law; to cultivate, irrigate, fertilize, fumigate, prune and 16498.10023\40972400.1
2 do all other acts which from the character or use of said property may be reasonably necessary, the specific enumeration's herein not excluding the general. (2) To provide, maintain and deliver to Beneficiary all insurance required under the Purchase and Sale Agreement and Joint Escrow Instructions, dated on or about __________, 2023, and, as applicable, any fire and extended coverage property insurance covering all improvements o n the property against loss or damage in an amount equal to not less than one hundred percent (100%) of the replacement cost, with loss payable to Beneficiary. The amount collected under any fire or other insurance policy may be applied by Beneficiary upon any indebtedness secured hereby and in such order as Beneficiary may determine, or at option of Beneficiary the entire amount so collected or any part thereof may be released to Trustor. Such application or release shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. All policies required hereunder shall be with companies having a Best's A-VIII rating (and if Best's no longer exists, an equivalent rating). Copies of all policies of insurance or certificates thereof shall be delivered to Beneficiary. As often as any such policies shall expire or terminate, renewal or additional policies shall be procured and maintained in like manner and to like extent. All policies of insurance must contain a provision that the company writing such policy will give both parties thirty (30) days' advance written notice of any cancellation or lapse of the effective date or any reduction in the amounts of insurance, unless such cancellation or lapse is as a result of failure to pay premiums, in which event written notice shall be given at least ten (10) days in advance. If Borrower fails to purchase, renew or maintain any insurance policies required herein, Beneficiary shall have the right to so purchase an y such insurance and the amount of any such advance by Beneficiary shall constitute additional loan amounts as described in Section A(5) below. (3) To appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee, and to pay all costs and expenses, including cost of evidence of title and attorney's fees in a reasonable sum, in any such action or proceeding in which Beneficiary or Trustee may appear, and in any suit brought by Beneficiary to foreclose this Deed. (4) To pay: at least ten (10) days before delinquency all taxes and assessments affecting said property, including assessments on appurtenant water stock; when due, all encumbrances, charges and liens, with interest, on said property or any part thereof, which appear to be prior or superior hereto; all costs; fees and expenses of this Trust.
Should Trustor fail to make any payment or to do any act as herein provided, then Beneficiary or Trustee, but without obligation so to do and without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may: make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon said property for such purposes; appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee; pay, purchase, contest or compromise any encumbrance, charge or lien which in the judgment of either appears to be prior or superior hereto; and, in exercising any such powers, pay necessary expenses, employ counsel and pay his reasonable fees. (5) To pay immediately and without demand all sums so expended by Benefici ary or Trustee, with interest from date of expenditure at the amount allowed by law in effect at the date hereof, and to pay for any statement provided for by law in effect at the date hereof regarding the obligation secured hereby any amount demanded by the Beneficiary not to exceed the maximum allowed by law at the time when said statement is demanded.
B. It is mutually agreed:
16498.10023\40972400.1
3 (1) That any award of damages in connection with any condemnation for public use of or injury to said property or any part thereo f is hereby assigned and shall be paid to Beneficiary who may apply or release such moneys received by him in the same manner and with the same effect as above provided or disposition of proceeds of fire or other insurance. (2) That by accepting payment of any sum secured hereby after its due date, Beneficiary does not waive his right either to require prompt payment when due of all other sums so secured or to declare default for failure so to pay.
(3) That at any time or from time to time, without liability therefor and without notice, upon written request of beneficiary and presentation of this Deed and said note for endorsement, and without affecting the personal liability of any person for payment of the indebtedness secured hereby, Trustee may: reconvey any part of said property; consent to the making of any map or plat thereof; join in granting any easement thereon; or join in any extension agreement or any agreement subordinating the lien or charge hereof.
(4) That upon written request of Beneficiary stating all sums secured hereby have been paid, and surrender of this Deed and said Note to Trustee for cancellation and retention or other disposition as Trustee in its sole discretion may choose and upon payment of its fees, Trustee shall reconvey, without warranty, the property then held hereunder. The recitals in such reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof. The Grantee in such reconveyance may be described as "the person or persons legally entitled thereto." (5) After the lapse of such time as may then be required by law following the recordation of said notice of default, and notice of sale having been given as then required by law, Trustee, without demand on Trustor, shall sell said property at the time and placed fixed by it in said notice of sale, either as a whole or in separate parcels, and in such order as it may determine, at public auction to the highest bidder for cash in lawful money of the United States, payable at time of sale.
Trustee may postpone sale of all or any portion of said property by public announcement at such time and place of sale, and from time to time thereafter may postpone such sale by public announcement at the time fixed by the preceding postponement. Trustee shall del iver to such purchaser its deed conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including Trust or, Trustee, or Beneficiary as hereinafter defined, may purchase at such sale.
After deducting all costs, fees and expenses of Trustee and of this Trust, including cost of evidence of title in connection with sale, Trustee shall apply the proceeds of sale to payment of: all sums expended under the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect at the date hereof; all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled thereto.
(6) Beneficiary, or any successor in ownership of any indebtedness secured hereby, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named herein or acting hereunder, which instrument, execut ed by the Beneficiary and duly acknowledged and recorded in the office of the recorder of the county or counties where said property is situated, shall be conclusive proof of proper substitution of such successor Trustee or Trustees, who shall, without conveyance from the Trustee predecessor, succeed to all its title, estate, rights, powers and duties.
Said instrument must contain the name of the original Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed is recorded and the name and address of the new Trustee. 16498.10023\40972400.1
4 (7) That this Deed applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors and assigns. The term Beneficiary shall mean the owner and holde r, including pledgees, of the note secured hereby, whether or not named as Beneficiary herein. In this Deed, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural. (8) That Trustee Accepts this Trust when this Deed, duly executed and acknowledged, is made a public record as provided by law. Trustee is not obligated to notify any party hereto of pending sale under any other Deed of Trust or of any action or proceeding in whic h Trustor, Beneficiary or Trustee shall be a party unless brought by Trustee.
Signature of Trustor:
WATER OF LIFE COMMUNITY CHURCH, a California nonprofit religious corporation
__________________________________
________________, Member
Address: ________________________
Approved as to Form
Buyer’s Attorney:_________________________
Date:_________________________________
Signature of Beneficiary:
CITY OF FONTANA. a California municipal corporation
_____________________________
By:
Name:
Its:
Date:
Approved as to Form
City Attorney:_________________________
Date:_________________________________
16498.10023\40972400.1
5 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)
16498.10023\40972400.1
6 EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
16498.10023\40972400.1
7 REQUEST FOR FULL RECONVEYANCE
TO ESCROW HOLDER, TRUSTEE:
The undersigned is the legal owner and holder of the note or notes, and of all other indebtedness secured by the foregoing Deed of Trust. You are hereby requested and directed to reconvey, without warranty, to the parties designated by the terms of said Deed of Trust.
Dated
Please mail Deed of Trust,
Note and Reconveyance to: _____________________________________________________ Do not lose or destroy this DEED OF TRUST or the NOTE which it secures. Both must be delivered to the Trustee for cancellation before reconveyance will be made.
16498.10023\40972400.1
EXHIBIT E
FORM OF GRANT DEED
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO, AND
MAIL TAX STATEMENTS TO:
[buyer address or attorney]
__________________________________________________________________________ A.P.N.: _________________________ (Space Above Line for Recorder's Use Only) The Undersigned Grantor(s) Declare(s):
DOCUMENTARY TRANSFER TAX $________; CITY TRANSFER TAX $________; SURVEY MONUMENT FEE $ ________
[ ] computed on the consideration or full value of property conveyed, OR [ ] computed on the consideration or full value less value of liens and/or encumbrances remaining at time of sale, [ ] unincorporated area; [ ] City of __________________, and
GRANT DEED
FOR VALUE RECEIVED, _______________________________________ (“Grantor”), grants to ____________________________ ( “Grantee”), all that certain real property situated in the County of ________________, State of California, described on Schedule 1 attached hereto and by this reference incorporated herein (the “Property”).
IN WITNESS WHEREOF, Grantor has executed this Grant Deed as of ________________, 20__.
GRANTOR:
__________________________________________
By: _______________________________________
Name: ___________________________________
Its: ______________________________________
16498.10023\40972400.1
2 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, _____________________________, a 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)
16498.10023\40972400.1
EXHIBIT F
SELLER DELIVERIES
16498.10023\40972400.1
EXHIBIT G
FORM OF AFFORDABILITY COVENANT
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO, AND
MAIL TAX STATEMENTS TO:
[buyer address or attorney]
__________________________________________________________________________ A.P.N.: _________________________ (Space Above Line for Recorder's Use Only) The Undersigned Grantor(s) Declare(s):
DOCUMENTARY TRANSFER TAX $________; CITY TRANSFER TAX $________; SURVEY MONUMENT FEE $ ________
[ ] computed on the consideration or full value of property conveyed, OR [ ] computed on the consideration or full value less value of liens and/or encumbrances remaining at time of sale, [ ] unincorporated area; [ ] City of __________________, and
Affordability Covenant to be Recorded
(per Government Code Section 54233 and/or 54233.5)
If ten (10) or more residential units are developed on the Property described in Exhibit A, not less than 15 percent of the total number of residential units developed on the property shall be sold or rented at affordable housing cost, as defined in Section 50052.5 of the California Health and Safety Code, or affordable rent, as defined in Section 50053 of the California Health and Safety Code, to lower income households, as defined in Section 50079.5 of the California Health and Safety Code. Rental units shall remain affordable to and occupied by lower income households for a period of 55 years for rental housing and 45 years for ownership housing. The initial occupants of all ownership units shall be lower income households, and the units shall be subject to an equity sharing agreement consistent with the provisions of paragraph (2) of subdivision (c) of 65915 of the California Government Code. These requirements shall be covenants or restrictions running with the land and shall be enforceable against any owner who violates a covenant or restriction and each successor-in-interest who continues the violation by any of the entities described in subdivisions (a) to (f), inclusive, of Section 54222.5 of the California Government Code.
Date: ______________________
WATER OF LIFE COMMUNITY CHURCH, a California nonprofit religious corporation,
16498.10023\40972400.1
5 By: ____________________________
Name: __________________________
Title: ___________________________
Approved as to Form
Attorney:_________________________
Date:_________________________________
16498.10023\40972400.1
EXHIBIT H
FORM OF USE COVENANT
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO, AND
MAIL TAX STATEMENTS TO:
[buyer address or attorney]
__________________________________________________________________________ A.P.N.: _________________________ (Space Above Line for Recorder's Use Only) The Undersigned Grantor(s) Declare(s):
DOCUMENTARY TRANSFER TAX $________; CITY TRANSFER TAX $________; SURVEY MONUMENT FEE $ ________
[ ] computed on the consideration or full value of property conveyed, OR [ ] computed on the consideration or full value less value of liens and/or encumbrances remaining at time of sale, [ ] unincorporated area; [ ] City of __________________, and
DECLARATION AND USE COVENANT
Whereas, Water of Life Community Church, a California nonprofit religious corporation, (“Owner”) submitted an application to the City of Fontana (“City”) for a conditional use permit and design review regarding the constructing and use of a community facil ity on approximately
4.2 acres of land located at Etiwanda Vineyard, and on Arrow Route [Boulevard], between Tokay Avenue and Citrus Avenue, in the City of Fontana, County of San Bernardino, State of California, commonly referred to as Assessor's Parcel Nu mbers 0232-201-12 and 0232- 201-013, more particularly described in the legal descriptions attached as Exhibit A and Exhibit B, incorporated herein (the “Property”);
Whereas, the City is the beneficiary of a Promissory Note (“Note”) made by Owner in the principal amount of $3,040,000, and such Note includes, among other items, terms for repayment of Note by Borrower on or before ____________, 2033;
Whereas, the Property encompasses multiple separate parcels (as shown in Exhibit A and Exhibit B) and Owner’s application for a conditional use permit sought permission for the following: Constructing a facility on the Property which shall include offices and office storage space, food pantry operation space, classrooms, restrooms, a small kitchen, reception area with counseling rooms, and a multi -purpose space for small community gatherings. Once completed, Owner, directly or through its partner entity CityLink, or any other successor or assignee, shall provide community services and programs including food distr ibution, homeless services including provision of hygiene kits, clothing, blankets, and other necessities, skills and other classes, counseling and referrals for Rapid Rehousing and Homeless Prevention, mobile medical 16498.10023\40972400.1
2 clinics, CityLink Boutique, Mechanics Ministry, and other similar programming. In addition to the ongoing services (food pantry, job location services, parenting skills, etc.), Owner may host events for holidays and special events. Services and events will be planned and coordinated in a manne r that will not overwhelm the project site or the surrounding area. Owner shall employ invitations, timeslot scheduling, and the use of security to ensure that events do not unnecessarily impact the area surrounding the project site;
Whereas, the City of Fontana granted to Owner Conditional Use Permit (“CUP”) No. 22- 014 and Design Review No. 22-024, because the programs and services that will be provided are vital to the community and represent an unquantifiable community and financial benefit to the City of Fontana, subject to the condition that Owner record a covenant restricting the development and use of the Property for purposes stated in the CUP and Design Review; and Whereas, Owner is executing and recording in the office of the San Bernardino County Recorder this Declaration and Use Covenant (“Covenant”) for the purpose of compliance with the above-stated conditions of approval.
Now, therefore, Owner declares and covenants that:
1. Declaration and Covenant. Until _____________, 2033, or until City receives full and final payment of the Note, whichever occurs first (the “Expiration Date”), Owner shall only use the Property in accordance with the approved CUP No. 22- 014 and Design Review No. 22- 024, as granted from City to Owner, and attached hereto as Exhibit C and Exhibit D, respectively, or as may be modified by City through a written agreement.
2. Covenant Runs With The Land. The Property shall be sold, conveyed, encumbered, hypothecated, leased, used, occupied and improved subj ect to the restrictions, covenants, conditions and equitable servitudes set forth in this Covenant, all of which are for the benefit of the City and shall run with the land and shall be binding upon all persons having any right, title or interest in the Property, or any part thereof, their heirs, successive owners and assigns , subject to termination on the Expiration Date . Other than termination in accordance with Section 1 above, this Covenant shall not be released or modified without the express written consent of the City, which City shall not unreasonably deny in the event of a discontinuance of the use permitted in CUP 22-014 and a proposed change in use of or a new development of the Property.
3. City Enforcement. The City is not a party to this Declar ation and Covenant but shall have the beneficial right to enforce the restrictions, covenants, conditions and equitable servitudes contained herein. City’s right to enforce may include but is not limited to the right to withhold or revoke, after giving not ice of violation, any building permits, occupancy permits, certificates of occupancy, business licenses and similar matters or approvals pertaining to the Property or any part thereof or interests therein as to the violating person or entity. In an action to enforce City’s rights herein, the prevailing party shall be entitled to its attorney’s fees and costs.
4. No Limitation On City. Any enforcement rights of the City are in addition to and not instead of rights of the City regarding enforcement of City code s and regulations. The failure or refusal of the City to exercise any of its rights or powers will not result in any liability to the City and shall not give rise to a cause of action against the City, its officers and employees, on the 16498.10023\40972400.1
3 part of any person. Owner shall comply with all City’s ordinances, regulations and standards (as adopted by the City), as may be applicable to the Property, including but not limited to the conditions of approval stated in CUP No. 22-014 and Design Review No. 22-024.
5. This A greement shall be recorded in the real property records of the Clerk and Recorder for San Bernardino County, California, and shall serve as notice to and shall be binding upon and inure to the benefit of, as applicable, Developer, City and the successive owners of the Property.
6. Notice. Any notice to City shall be delivered to [INSERT CITY INFO].
WATER OF LIFE COMMUNITY CHURCH, a California nonprofit religious corporation
__________________________________
________________, Member
Address: ________________________
Approved as to Form
Attorney:_________________________
Date:_________________________________
16498.10023\40972400.1
4 EXHIBIT I
TRANSFEROR'S CERTIFICATION OF NON-FOREIGN STATUS
This form is provided so that the Buyer and/or Seller in this transaction can certify compliance with the Foreign Investment in Real Property Tax Act to the Escrow Agent and/or Buyer. Buyer (“Transferee”) must retain a copy of this document until after the fifth taxable year following the transfer.
Section 1445 of t he Internal Revenue Code of 1986, as amended ( “Code”) provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person.
For U.S. tax purposes (including section 1445), the owner of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the transferor of the property and not the disregarded entity. To inform Transferee that withholding of tax is not required upon the disposition of a U.S. real property interest, the undersigned hereby certifies the following on behalf of _________________________________ (“Transferor”):
1. The Transferor is not a foreign corporation, foreign partnership, foreign trust, foreign estate or foreign person (as those terms are define d in the Code and the Income Tax Regulations promulgated thereunder).
2. The Transferor is not a disregarded entity as defined in Income Tax Regulation Section 1.1445-2(b)(2)(iii).
3. The Transferor's U.S. employer or tax identification number is ______________.
4. The Transferor's office address is
The Transferor understands that this Certification may be disclosed to the Internal Revenue Service by the Transferee and that any false statement contained herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined this Certification and to the best of my knowledge and belief it is true, correct and complete, and I further declare that I have authority to sign this document on behalf of the Transferor.
Date:______________, 20__ TRANSFEROR:
__________________________________________
By: _______________________________________
Name: ___________________________________
Its: ______________________________________