Fontana City Council
May 14, 2024

Tuesday, May 14, 2024
2:00 PM
City of Fontana
8353 Sierra Avenue
Fontana, CA 92335
Regular Agenda
Ord. No. 1950 Reso. No. 2024-019
Grover W. Taylor Council Chambers
City Council Meeting
Acquanetta Warren - Mayor
Peter A. Garcia - Mayor Pro Tem
John B. Roberts - Council Member
Jesus "Jesse" Sandoval - Council Member
Phillip Cothran - Council Member
Germaine Key - City Clerk
Janet Koehler-Brooks, City Treasurer
1 City Council Meeting Regular Agenda May 14, 2024
Welcome to a meeting of the Fontana City Council.

Welcome to a meeting of the Fontana City Council. Meetings are held at the Grover W. Taylor Council Chambers 8353 Sierra Avenue Fontana, CA 92335. To address the Council, please fill out a card located at the entrance to the right indicating your desire to speak on either a specific agenda item or under Public Communications and give it to the City Clerk. Your name will be called when it is your turn to speak. In compliance with Americans with Disabilities Act of 1990 (42 USC § 12132), the Council Chambers is wheelchair accessible, and a portable microphone is available. Upon request, this agenda will be made available in appropriate alternative forms to persons with disabilities, as required by Section 12132 of the Americans with Disabilities Act of 1990. Any person with a disability who requires accommodation to participate in a meeting should direct such a request to the City Clerk’s Office at (909) 350-7602 at least 48 hours before the meeting, if possible. Any public record, relating to an open session agenda item, that is distributed within 72 hours prior to the meeting is available for public inspection at the City Clerk’s Office.

Para traducción en Español, comuniquese con la oficina,“City Clerk” al (909) 350-7602.

The City of Fontana is committed to ensuring a safe and secure environment for its residents to engage with the government. No oversized bags or backpacks (size limit of 14”x14”x6”) will be allowed inside the Council Chambers. All bags are subject to search. Face masks are prohibited in the Council Chambers, but clear masks will be provided upon request to accommodate individuals with medical needs, ensuring their safety and well-being. Before entering the Council Chambers, you may be subject to a metal detector screening. The City Manager retains the discretion to grant any exemptions. Fontana aims to provide safe buildings for our community members, employees, and visitors.

PUBLIC COMMUNICATION - CLOSED SESSION:

This is an opportunity for citizens to speak to the City Council for up to 3 minutes on the following Closed Session. The Mayor and City Council reserve the right to adjust this time limit based on the number of speakers who wish to address the Mayor and City Council.

A. Public Communications - Closed Session
CLOSED SESSION:

A. 1:00 P.M. CLOSED SESSION
A. 1. CONFERENCE WITH LABOR NEGOTIATOR PURSUANT
TO GOVERNMENT CODE SECTION 54957.6
Class & Compensation Study Discussion
City Negotiator: Matt Ballantyne, City Manager and Rakesha Voss, Director of Human Resources and Risk Management.

2. CONFERENCE WITH LEGAL COUNSEL - EXISTING

LITIGATION
(Gov. Code Section 54956.9(d)(1))
21-3006

2 City Council Meeting Regular Agenda May 14, 2024
Name of Case: Catalyst - Fontana LLC v. City of Fontana, et al Case No. CIVSB2329401

3. CONFERENCE WITH LEGAL COUNSEL – EXISTING

LITIGATION
(Gov. Code Section 54956.9(d)(1))
Name of Case: Planned Parenthood/Orange and San
Bernardino Counties, Inc. vs. City of Fontana
CALL TO ORDER/ROLL CALL:

A. Call To Order/Roll Call:

INVOCATION/PLEDGE OF ALLEGIANCE:

A. Invocation/Pledge of Allegiance:

PROCLAMATION:

A. Proclamation
A. 1. Mayor Warren and City Council to proclaim May 5-11, 2024, as Professional Municipal Clerk's Week (City Clerk Germaine Key to accept).

2. Mayor Warren and City Council to proclaim the month of May 2024 as National Building and Safety Month (Building and Safety Director Jeffrey Baughman to accept).

3. Mayor Warren and City Council to proclaim Wednesday, May 15, 2024, as POLICE OFFICERS MEMORIAL DAY in
Fontana and the week of May 11-17, 2024, as National
Police Week in Fontana (Police Officer Association
President, Jason Delair to accept).
21-2984
SPECIAL PRESENTATIONS:

A. Special Presentations
A. 1. Mayor Warren and City Council to swear in new Fontana Police Officers Alex Chuy, Imaad Sally, and Bishop
Thompson (Chief Michael Dorsey to present).

2. Mayor Warren and City Council to swear in new San
Bernardino County Firefighters, (Assistant Chief, Jeff
Birchfield to present).

3. Mayor Warren and City Council to recognize Account
21-2985

3 City Council Meeting Regular Agenda May 14, 2024
Payable Clerk, Patricia Valdez on her retirement (Chief Financial Officer, Jessica Brown to present).

PUBLIC COMMUNICATIONS:

This is an opportunity for members of the public to address the City Council for up to three (3) minutes total on items either on the Agenda or items not on the Agenda, but within the City Council's jurisdiction. Note that Public Hearing items have individual and specific public input opportunities during the public hearing and testimony on those items will only be taken during the public hearing. The Council is prohibited by law from discussing or taking immediate action on non-agendized items. The Mayor and City Council reserve the right to adjust this time limit based on the number of speakers who wish to address the Mayor and City Council.

A. Public Communications
CONSENT CALENDAR:

All matters listed under CONSENT CALENDAR will be enacted by one motion in the form listed below. There will be no separate discussion on these items prior to the time Council votes on them, unless a member of the Council requests a specific item be removed from the Consent Calendar for discussion.

Approve Consent Calendar Items as recommended by staff.

A. Approval of Minutes 21-2994
Approve the minutes of the April 23, 2024, Regular City Council Meeting.

Attachments: City Council Meeting Minutes 04-23-2024.pdf B. Adoption of Ordinance No.1949 (Second Reading), a
Development Agreement with HS Fontana Retail, LLC
21-2993
Adoption of Ordinance No. 1949 on Second Reading, Pursuant to an Exemption from the California Environmental Quality Act, Approving a Development Agreement with HS Fontana Retail, LLC, concerning a retail cannabis business and Direct Staff to File a Notice of Exemption.

Attachments: Ord. No 1949R.docx
C. Purchase and Sale Agreement - Downtown Fontana
Property
21-2955

1. Approve a Purchase and Sale Agreement for the purchase of property located at 16710 and 16726 Spring Street, more specifically described as APNs #0191-161-13 and 0191-161-18.

2. Authorize the City Manager to execute any documents necessary or appropriate to effectuate said approvals and/or agreement.

Attachment - Purchase and Sale Agreement_16710 AND
16726 Spring Street_Fully Executed.pdf
Attachments:

4 City Council Meeting Regular Agenda May 14, 2024
D. Award a Construction Contract for Public Works Concrete Maintenance Project (PW-24-133-SB)
21-2960
Approve and authorize the City Manager to execute a construction contract with We R Builders, Inc. from Glendale CA for the construction of the Public Works Concrete Maintenance Project in the amount of $289,836.00 and authorize a 10% contingency in the amount of $28,983.60 Bid Summary
We R Builders Bid - PW-24-133-SB.pdf
Vicinity Map Sierra Lakes Concrete Project.pdf
Attachments:

E. Adopt a Resolution for Projects Funded by the Road Repair and Accountability Act SB 1
21-2968
Adopt Resolution No. 2024-019 of the City Council of the City of Fontana to incorporate projects funded by SB 1, the Road Repair and Accountability Act for Fiscal Year 2024/2025.

Attachments: 2024-019 Resolution no.docx
F. Approve a Professional Services Agreement for
Architectural Design Services for the Forge Studios and Innovation Lab Project (DE-24-160-SP)
21-2986

1. Approve and authorize the City Manager to execute a Professional Services Agreement in a not-to-exceed amount of $467,690.00 with DSEA, Inc. for Architectural Design Services for the Forge Studios and Innovation Lab Project, Request for Proposals DE-24-160-SP.

2. Approve and authorize the City Manager to execute future individual amendments to the Professional Services Agreement not exceeding $100,000.00 for the Forge Studios and Innovation Lab Project, Request for Proposals DE-24-160-SP.

3. Approve and authorize the City Manager to execute any and all utility agreements, utility easements, and any related items on behalf of the City of Fontana for the Forge Studios and Innovation Lab Project.

Vicinity Map.pdf
Evaluation Results.pdf
Forge Studios Professional Services Agreement.pdf
Attachments:

G. Approve a Task Order for Geotechnical Engineering and Materials Testing Services for the Downtown West Parking Structure Project.
21-2987

1. Approve and authorize the City Manager to execute a Task Order in a

5 City Council Meeting Regular Agenda May 14, 2024
not-to-exceed amount of $321,478.00 with Ninyo & Moore Geotechnical and Environmental Sciences Consultants, Inc. for Geotechnical Engineering and Material Testing Services for the Downtown West Parking Structure Project, Request for Proposals SQ-87-DE-19-88.

2. Approve and authorize the City Manager to execute future individual Task Order Amendments not exceeding $100,000.00 for the Downtown West Parking Structure Project.

3. Approve and authorize the City Manager to execute any and all utility agreements, utility easements, and any related items on behalf of the City of Fontana for the Downtown West Parking Structure Project Vicinity Map (DWPS).pdf
Evaluation Results (DWPS).pdf
Attachments:

H. Final Acceptance of Street, Storm Drain, Sewer, Traffic Signal, and Signing & Striping Improvements on the
southwest corner of South Highland Avenue and Mango
Avenue for Tract No. 20441
21-2988

1. Accept as complete the street, storm drain, sewer, traffic signal, and signing & striping improvements for Tract No. 20441 located on the southwest corner of South Highland Avenue and Mango Avenue.

2. Adopt Resolution No. 2024-020 of the City Council of the City of Fontana accepting public sewers in Tract No. 20441 as part of the City sewer system.

VICINITY MAP TRACT 20441.pdf
TRACT MAP 20441.pdf
TRACT 20441 - RESOLUTION.doc
Attachments:

I. Acceptance of Final Map for Tract No. 20512 21-2989
Approve the Final Map for Tract No. 20512, located on the northeast corner of Citrus Avenue and Summit Avenue, and accept easements.

VICINITY MAP.pdf
TRACT MAP 20512.pdf
Attachments:

J. Approve a Bond Reduction for Tract No. 17041 - Lot 3 (In-tract Improvements) located within the Citrus Heights North Specific Plan (Shady Trails).
21-2990
Approve a reduction of the Faithful Performance Bond, Labor and Material Bond, and the Warranty Bond posted by PLC Shady Trails LLC, a Delaware Limited Liability Company, for Tract 17041 - Lot 3 in-tract improvements consisting of street, street light, storm drain, and sewer, located within the

6 City Council Meeting Regular Agenda May 14, 2024
Citrus Heights North Specific Plan (Shady Trails).

Bonds - Tract 17041-Lot 3.pdf
Tract 17041.pdf
Vicinity Map.pdf
Attachments:

K. Police Department Monthly Information Update 21-2995 Accept the Police Department monthly information update for March 2024.

Attachments: March 2024 Report for City Council Rev.pptx L. Final Acceptance of the Cypress Center and Knopf Center Tenant Improvements Project.
21-3000

1. Accept as complete the work performed by Fidelity Builders for the tenant improvements to the Cypress and Knopf Center Project (PW-24-20-PW) and approve the final construction costs of $477,275.50.

2. Authorize the Public Works Director to file a Notice of Completion and release the 5% retention.

M. Co-Sponsorship Application Cycle One (1) FY 2024/2025 21-3002 Review and approve (17) Co-Sponsorships recommended for the first half of the 2024/2025 fiscal year (July 2024 through June 2025) totaling $41,728 in in-kind support as recommended by the Parks, Community, and Human Services Commission.

Attachment A Co-Sponsorship Policy.pdf
Attachment B_Feb24.pdf
Attachment C_Feb '24.pdf
Attachment D w_out Revenue Loss_Feb24.pdf
Attachment E_Priority Matrix_Feb '24.pdf
Attachments:

PUBLIC HEARINGS:

To speak on Public Hearing Items, submit comments via e-mail at [email protected]. In the subject of your e-mail please indicate whether you are in favor or opposition of the item. Comments must be received no later than 12:00 P.M. on the day of the meeting. Comments of no more than three (3) minutes will be read into the record at the appropriate time during the meeting. If you challenge in court any action taken concerning a Public Hearing item, you may be limited to raising only those issues you or someone else raised at the Public Hearing described in this notice or in written correspondence delivered to the City at, or prior to, the Public Hearing.

All Public Hearings will be conducted following this format:

7 City Council Meeting Regular Agenda May 14, 2024
(a) hearing opened (e) oral - favor
(b) written communication (f) oral - opposition
(c) council/staff comments (g) hearing closed
(d) applicant comments (applicant not limited to 5 minutes) A. Public Hearing for Consideration and Adoption of a
Campaign Sign Deposit
21-2950
Adopt Resolution No. 2024-021, adopting a refundable campaign sign deposit.

Attachments: Reso 2024-021.docx
B. Appeal No. 24-003, Appeal No 24-004, and Appeal No.
24-006: Requests to overturn the Planning Commission’s
decision on March 19, 2024, approving Tentative Parcel
Map No. 21-007 (TPM No. 20456) and Design Review No.
21-013 certifying a Final Environmental Impact Report
(FEIR), State Clearinghouse Number (SCH No.) 202112059
and adopting a Mitigation, Monitoring, and Reporting
Program (MMRP) for the consolidation of 22 parcels into one parcel and the development of an industrial warehouse building totaling approximately 623,460 square feet on
approximately 29.8 acres on the northwest corner of Slover Avenue and Cypress Avenue (APNs: 0251-163-01, -02, -03, -04, -05, -06, -07, -08, -09, -10, & -13, and 0251-164-03, -04, -10, -11, -12, -14, -15, -16, -20, -23, & -25).
21-2969

1. Deny Appeal No. 24-003, Appeal No. 24-004, and Appeal No. 24-006, thereby upholding the Planning Commission’s decision on March 19, 2024 approving Tentative Parcel Map No. 21-007 (TPM No. 20456) and Design Review No. 21-013 along with the certification of a Final Environmental Impact Report (EIR), State Clearinghouse Number (SCH No. 202112059) and adoption of a Mitigation, Monitoring, and Reporting Program (MMRP) for the consolidation of 22 parcels into one parcel and development of an industrial commerce building totaling approximately 623,460 square feet on approximately 29.8 acres located at the northwest corner of Slover Avenue and Cypress Avenue (APNs: 0251-163-01, -02, - 03, -04, -05, -06, -07, -08, -09, -10, & -13, and 0251-164-03, -04, -10, -11, -12, -14, -15, -16, -20, -23, & -25).

2. Uphold the Planning Commission’s decision to Certify the FEIR, SCH No. 20212059 and adopt the MMRP and direct staff to file a Notice of Determination.

APPELLANTS / APPEAL APPLICANTS:

Appeal No. 24-003: Golden State Environmental Justice Alliance, PO Box

8 City Council Meeting Regular Agenda May 14, 2024
79222, Corona, CA 92877.

Appeal No. 24-004: Advocates for the Environment, 10211 Sunland Boulevard, Shadow Hills, CA 91040.

Appeal No. 24-006: Adams Broadwell Joseph & Cardozo for CARE CA, 520 Capitol Mall, Suite No. 350, Sacramento, CA 95814.

Attachment No. 1 - Vicinity Map
Attachment No. 2 - Appellant Letter (Golden State
Environmental Justice Alliance&Response Memorandum
Attachment No. 3 - Appellant Letter (Advocates for the
Environment & Response Memorandum
Attachment No. 4 - Appellant Letter (Adams Broadwell
Joseph & Cardozo-CARE CA) & Response Memorandum
Attachment No. 5 - Planning Commission March 19, 2024
packet
Attachment No. 6 - Planning Commission Minutes
Attachment No. 7 -Clerk of the Board Fee Receipt and NOD Attachment No. 8 - Public Hearing Notice
Attachments:

C. Appeal No. 24-002 and Appeal No. 24-005: Requests to overturn the Planning Commission’s March 19, 2024
decision approving Tentative Parcel Map No. 23-012 (TPM No. 20710) and Design Review No. 22-064 along with the
certification of a Final Subsequent Environmental Report State Clearinghouse Number (SCH No. 2009091089) and
adoption of a Mitigation, Monitoring, and Reporting
Program, for the consolidation of three parcels into one parcel and development of an industrial warehouse
building totaling approximately 881,826 square feet on
approximately 40.01 acres located at 11115 Hemlock
Avenue (APNs: 0237-131-25, 0237-131-26, and -27).
21-2963

1. Deny Appeal No. 24-002 and Appeal No. 24-005, thereby upholding the Planning Commission’s decision on March 19, 2024, approving Tentative Parcel Map No. 23-012 (TPM No. 20710) and Design Review No. 22-064 along with the certification of a Final Subsequent Environmental Report (FSEIR) State Clearinghouse Number (SCH No. 2009091089) and adoption of a Mitigation Monitoring and Reporting Program (MMRP) for the consolidation of three parcels into one parcel and development of an industrial warehouse building totaling approximately 881,826 square feet on approximately 40.01 acres located at 11115 Hemlock Avenue (APNs:
0237-131-25, 0237-131-26, and -27).

2. Uphold the Planning Commission decision to certify the FSEIR, SCH No. 2009091089, and adopt the MMRP and direct staff to file a Notice of Determination.

APPELLANTS / APPEAL APPLICANTS:

9 City Council Meeting Regular Agenda May 14, 2024
Appeal No. 24-002: Golden State Environmental Justice Alliance, PO Box 79222, Corona, CA 92877
Appeal No. 24-005: Adams Broadwell Joseph and Cardozo for Californians Allied for a Responsible Economy (CARE CA): 601 Gateway Boulevard Ste 1000, South San Francisco, CA 94080
Attachment No. 1 - Vicinity Map
Attachment No. 2 - Appellant letter and Response
Memorandum (Golden State Environmental Justice Alliance) Attachment No. 3 - Appellant letter and Response
Memorandum (CARE)
Attachment No. 4 - Planning Commission March 19, 2024
packet
Attachment No. 5 - Planning Commission Minutes
Attachment No. 6 - Clerk of the Board Fee Receipt and NOD Attachment No. 7 - Public hearing Notice
Attachments:

D. Master Case No. 22-143, Development Agreement (AGR)
No. 24-002: An Ordinance of the City Council of the City of Fontana, California, approving, pursuant to the certified Final Subsequent Environmental Impact Report, a
Development Agreement with Prologis Exchange 11115
Hemlock Avenue LLC, providing for an extended
entitlement timing and enhanced environmental measures
for an approved industrial commerce center development
of approximately 881,826 square feet on approximately

40.01 acres, and directing staff to File a Notice of
Determination.
21-2923
Based on the information in the staff report and subject to the findings, conclusions, and information in the staff report and presented in the public hearing, staff recommends that the City Council:

1. Find that the project has been reviewed under a previously certified Final Subsequent Environmental Impact Report (State Clearinghouse No. 2009091089), pursuant to Section 15162 through 15164 of the California Environmental Quality Act (CEQA) Guidelines and Section 8.10 of the City of Fontana’s 2019 Local Guidelines for Implementing CEQA and that no further analysis is required, and direct staff to file a Notice of Determination; and

2. Read by title only and waive further reading of and introduce Ordinance No. 1950, an Ordinance of the City Council of the City of Fontana, pursuant to the certified Final Subsequent Environmental Impact Report (SCH 2009091089) for the project, approving Development Agreement (AGR) No. 24-002 between the City of Fontana and Prologis Exchange 11115 Hemlock Avenue LLC, which provides for extended entitlement

10 City Council Meeting Regular Agenda May 14, 2024
timing and enhanced environmental measures for an approved industrial commerce center development of approximately 881,826 square feet on approximately 40.01 acres.

Attachment No. 1 - Vicinity Map
Attachment No. 2 - Planning Commission March 19, 2024
packet
Attachment No. 3 - Planning Commission Minutes
Attachment No. 4 - Ordinance
Attachment No. 5 - Notice of Determination
Attachment No. 6 - Public hearing notice.docx
Attachments:

E. Master Case No. 24-019 and Municipal Code Amendment
No. 24-001: Fontana Municipal Code amendments to
Chapter 30 (Zoning and Development Code), pursuant to a categorical exemption in accordance with CEQA
Guidelines section 15060(c) and 15061(B)(3).
21-2924

1. Determine that this project is Categorically Exempt pursuant Sections 15060(c), 15061(B)(3) (the “common-sense” exemption), and 15378 and Sections No. 3.01, 3.22, and 10.59 of the 2019 Local Guidelines for Implementing CEQA, and direct staff to file a Notice of Exemption; and,

2. Read by title only and waive further reading of and introduce Ordinance No. 1951, an Ordinance of the City Council of the City of Fontana approving Master Case No. 24-019 and Municipal Code Amendment No. 24-001 to amend multiple sections of Chapter 30 of the Fontana Zoning and Development Code, including amendments to sections 30-41, 30-43, 30-80, 30-215, 30-217, 30-302.2, and 30-643 to remove references to the Development Advisory Board; Sections 30-285 and 30-294 to correct noticing verbiage related to Tentative Maps; Sections 30-362 through 30- 370 and 30-378 through 30-380 to remove Form Based Code maximum lot dimensions and add language to allow common and public open space for projects over two acres in the Form Base Code; Section 30-404 to provide common open space amenity options; Section 30-467 to remove ADU owner occupancy requirements consistent with state law; and Section 30-530 to remove certain “all other” use categories permitted in industrial zoning districts; and the reading of the title constitutes the first thereof.

Attachment No. 1 - Ordinance
Attachment No. 2 - Notice of Exemption
Attachment No. 3 - Public Hearing Notice Phase 3
Attachments:

F. Public Hearing on Formation of Community Facilities
District No. 113 (The Gardens Phase Two)
21-3001

1. Adopt Resolution No. 2024-022, of the City Council of the City of

11 City Council Meeting Regular Agenda May 14, 2024
Fontana of formation of the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two), authorizing the levy of a special tax within the community facilities district and establishing an appropriations limit for the community facilities district.

2. Adopt Resolution No. 2024-023, of the City Council of the City of Fontana deeming it necessary to incur bonded indebtedness within the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).

3. Adopt Resolution No. 2024-024, of the City Council of the City of Fontana calling special election for City of Fontana Community Facilities District No. 113 (The Gardens Phase Two).

4. Adopt Resolution No. 2024-025, of the City Council of the City of Fontana declaring results of special election and directing the recording of notice of special tax lien.

5. Read by title only and waive further reading of and introduce Ordinance No. 1952 levying special taxes within the City of Fontana Community Facilities District No. 113 (The Gardens Phase Two); and that the reading of the title constitutes the first reading thereof.

6. Adopt Resolution No. 2024-026, of the City Council of the City of Fontana authorizing the execution and delivery of Joint Community Facilities Agreements.

7. Adopt Resolution No. 2024-027, of the City Council of the City of Fontana authorizing the execution and delivery of a Letter of Credit Agreement and an Acquisition and Funding Agreement.

12 City Council Meeting Regular Agenda May 14, 2024
Resolution of Formation
Resolution Deeming Necessity
Resolution Calling Special Election
Resolution Declaring Results
Ordinance to Levy Special Tax
Resolution Approving Joint Community Facilities Agreement Resolution Approving Letter of Credit Agreement and
Acquisition Agreement
Concurrence of Election Official
Notice of Special Tax Lien
CFD No. 113 (The Gardens Phase Two) CFD Report
North Fontana Investment Co. Consent and Waiver
Richmond American Consent and Waiver
West Valley Water District Joint Community Facilities
Agreement
Acquisition and Funding Agreement
Letter of Credit Agreement
Attachments:

G. Public Hearing, Election, and Resolutions on Formation of Community Facilities District No. 114M (Tract 20512)
21-3003
Immediately after conducting a Public Hearing on the formation of the City of Fontana Community Facilities District No. 114M (the “District” or “Community Facilities District No. 114M”), staff recommends the City Council take the following actions in the following order:

1. Adopt Resolution No. 2024-028, Establishing the City of Fontana Community Facilities District No. 114M (the “Resolution of Formation”).

2. Adopt Resolution No. 2024-029, Calling a Special Election and Submitting to the Voters of Community Facilities District No. 114M a Proposition with Respect to the Annual Levy of Special Taxes within Community Facilities District No. 114M to Pay the Costs of Certain Services to be Provided by Community Facilities District No. 114M and a Proposition with Respect to the Establishment of an Appropriations Limit for Community Facilities District No. 114M (the “Resolution Calling the Election”).

3. Conduct the Special Election.

4. Adopt Resolution No. 2024-030, Declaring the Results of the Special Election for Community Facilities District No. 114M on the Propositions with Respect to (i) the Annual Levy of Special Taxes to Pay the Costs of Certain Services to be provided by Community Facilities District No. 114M and (ii) the establishment of an appropriations limit (the “Resolution

13 City Council Meeting Regular Agenda May 14, 2024
Declaring Election Results”).

5. Conduct First Reading (Read title only, and waive further reading) of Ordinance No. 1953, Authorizing the Levy of a Special Tax within Community Facilities District No. 114M (the “Ordinance”).

Resolution of Formation
Resolution Calling Special Election
Resolution Declaring Election Results
Ordinance Authorizing Levy of Special Taxes
CFD No. 114M CFD Report
Attachments:

NEW BUSINESS:

A. New Business
A. Fiscal Year 2023-24 Third Quarter Budget Status Report 21-2997 Approve the recommended Fiscal Year 2023-24 Third Quarter Budget adjustments.

Attachments: Fiscal Year 2023-24 Third Quarter Budget Status Report.pdf B. American Rescue Plan Act Update 21-3004
Receive update and approve revisions to the American Rescue Plan Act (ARPA) Expenditure Plan, including the leveraged projects.

Attachment A.pdf
Attachment B.pdf
Attachments:

CITY MANAGER COMMUNICATIONS:

A. City Manager Communications
ELECTED OFFICIALS COMMUNICATIONS/REPORTS:

A. Elected Officials Communications/Reports
ADJOURNMENT:

A. Adjournment
Adjourn to the next Regular City Council Meeting on May 28, 2024 at 2:00 p.m. in the Grover W. Taylor Council Chambers located at 8353 Sierra Avenue, Fontana, California.

14 City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-3006 Agenda Date: 5/14/2024
Agenda #: A. Category: Closed Session
Closed Session
Tuesday, May 14, 2024
1:00 P.M.

City Hall - Executive Conference Room
City Council
Acquanetta Warren, Mayor
Peter Garcia, Mayor Pro Tem
John Roberts, Council Member
Jesus “Jesse” Sandoval, Council Member
Phillip W. Cothran., Council Member
City of Fontana Page 1 of 1 Printed on 5/8/2024
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City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2984 Agenda Date: 5/14/2024
Agenda #: A. Category: Proclamation
Proclamations
Tuesday, May 14, 2024
2:00 P.M.

Grover W. Taylor Council Chambers
City Council
Acquanetta Warren, Mayor
Peter Garcia, Mayor Pro Tem
John Roberts, Council Member
Jesus “Jesse” Sandoval, Council Member
Phillip W. Cothran., Council Member
City of Fontana Page 1 of 1 Printed on 5/6/2024
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City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2985 Agenda Date: 5/14/2024
Agenda #: A. Category: Special Presentation
Special Presentations
Tuesday, May 14, 2024
Council Chambers
City Council
Acquanetta Warren, Mayor
Peter Garcia, Mayor Pro Tem
John Roberts, Council Member
Jesse “Jesus” Sandoval, Council Member
Phillip W. Cothran, Council Member
City of Fontana Page 1 of 1 Printed on 5/6/2024
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City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2994 Agenda Date: 5/14/2024
Agenda #: A. Category: Consent Calendar
FROM:

City Clerk
SUBJECT:

Approval of Minutes
RECOMMENDATION:

Approve the minutes of the April 23, 2024, Regular City Council Meeting.

COUNCIL GOALS:
· Create and maintain a dynamic team by supporting the decisions of the majority once made.
· Create and maintain a dynamic team by communicating Goals and Objectives to all commissions and employees.

DISCUSSION:

The City Council will consider approval of the minutes of the April 23, 2024, Regular City Council Meeting. The draft minutes are attached to this report for Council review and approval.

FISCAL IMPACT:

None.

MOTION:

Approve staff recommendation.

City of Fontana Page 1 of 1 Printed on 5/6/2024
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City of Fontana
8353 Sierra Avenue
Fontana, CA 92335
Minutes
Tuesday, April 23, 2024
2:00 PM
Grover W. Taylor Council Chambers
City Council Meeting
Acquanetta Warren - Mayor
Peter A. Garcia - Mayor Pro Tem
John B. Roberts - Council Member
Jesus "Jesse" Sandoval - Council Member
Phillip Cothran - Council Member
Germaine Key - City Clerk
Janet Koehler-Brooks, City Treasurer
19

CALL TO ORDER/ROLL CALL:

A. 2:00 P.M. Call To Order/Roll Call:

The Regular Meeting of the Fontana City Council was held in the Grover W. Taylor Council Chambers, 8353 Sierra Avenue, Fontana, CA 92335, on Tuesday, April 23, 2024.

Mayor Pro Tem Garcia called the Regular City Council Meeting to order at 2:00 p.m.

ROLL CALL:

PRESENT: Mayor Pro Tem Garcia, Council Members Cothran, Roberts and Sandoval.

City Treasurer Janet Koehler-Brooks and City Clerk Germaine Key were also present.

ABSENT: Mayor Warren
INVOCATION/PLEDGE OF ALLEGIANCE:

A. Invocation/Pledge of Allegiance:

The invocation was given by Council Member Roberts, followed by the pledge of allegiance led by Council Member Sandoval.

SPECIAL PRESENTATIONS:

A. Special Presentations
Mayor Pro Tem Garcia and City Council recognized Officers Matthew Sherwood and Steve Solis, Dispatch Supervisor Justine Mojarro and Dispatchers Angelica Padilla and Courtney Francis as Fontana Police Department’s January 2024 Employees of the Month.

PUBLIC COMMUNICATIONS:

A. Public Communications
Congressional candidate Mark Cargile introduced himself to the Council and discussed concerns with federal funding being allocated to Ukraine instead of to each congressional district.

Mark Richichi spoke in opposition of Planned Parenthood.

Maria Valadez spoke in opposition of Planned Parenthood.

Steve Caprio discussed concerns with Entrepreneur High School. 20

Susana Morales spoke against abortion.

Chad Gaskin discussed concerns with a Code Enforcement Notice of Violation that he received.

James Pester discussed concerns with the Burrtec Waste Industries tax roll billing implementation and not being able to file a police report regarding recent identity theft incidents.

Rebecca P. spoke in opposition of Planned Parenthood.

Maria P. spoke in opposition of Planned Parenthood.

Jesus Crist Organization spoke in opposition of Planned Parenthood.

CONSENT CALENDAR:

Mayor Pro Tem Garcia stated that Consent Calendar Item “O” would be pulled from the Consent Calendar and discussed separately under New Business Item “A.” ACTION: Motion was made by Council Member Roberts, seconded by Council Member Cothran, and passed by a vote of 4-0 to approve Consent Calendar Items “A-N” and “P-Q,” with Council Member Sandoval abstaining on Item “A” and voting No on Items “D,E,F,G and H.” The motion carried by the following vote: AYES: Garcia, Cothran, Roberts, and Sandoval; NOES: None; ABSTAIN: None; ABSENT: Warren A. Approval of Minutes 21-2939
Approve the minutes of the April 9, 2024, Regular City Council Meeting.

B. Proclamation Declaring May as "National Cities, Towns, and 21-2962 Villages Month"
The City Council is asked to approve a proclamation declaring May as "National Cities, Towns, and Villages Month" and to support efforts to promote community engagement and celebration throughout the month.

C. Adoption of Ordinance No. 1943 (Second Reading), update the 21-2972 zoning map from Single-Family Residential (R-1) to Medium Density Residential (R-2).

Second Reading / Adoption of Ordinance No. 1943, approving, pursuant to a Mitigated Negative Declaration, Zoning District Map Amendment No. 20-015 to update the zoning map from Single-Family Residential (R-1) to Medium Density Residential (R-2) for four (4) parcels APNs: 0233-122-28, -29, -60 and -63.

D. Adoption of Ordinance No. 1944 (Second Reading), a change 21-2973 of zoning designation from Residential Planned Community 21

(R-PC) to Southwest Industrial Park (SWIP) Specific Plan, Slover East Industrial District.

Second Reading / Adoption of Ordinance No. 1944, approving, pursuant to the Mitigated Negative Declaration and Mitigation Monitoring and Reporting Program for the Fontana Business Center 3 project, Zoning District Map Amendment No. 23-002 to change the zoning designation for APNs:
0255-101-24 and -30 from Residential Planned Community (R-PC) to Southwest Industrial Park (SWIP) Specific Plan, Slover East Industrial District for approximately 1.6 acres located on the east side of Juniper Avenue, south of Santa Ana Avenue.

E. Adoption of Ordinance No. 1945 (Second Reading), a Specific 21-2975 Plan Amendment to the Southwest Industrial Park (SWIP)
Second Reading / Adoption of Ordinance No. 1945, approving, pursuant to the project Mitigated Negative Declaration and Mitigation Monitoring and Report Program, Specific Plan Amendment No. 23-001, an amendment to the Southwest Industrial Park (SWIP) Specific Plan to include 1.6 acres in the Slover East Industrial District on the east side of Juniper Avenue, south of Santa Ana Avenue.

F. Adoption of Ordinance No. 1946 (Second Reading), a 21-2974 Development Agreement between the City of Fontana and
Chase Partners.

Second Reading / Adoption of Ordinance No. 1946, Approving, pursuant to an adopted Mitigated Negative Declaration, a Development Agreement No. 23-001 between the City of Fontana and Chase Partners, which provides a public benefit fee in the amount of $150,896.25.

G. Adoption of Ordinance No. 1947 (Second Reading), a zoning 21-2976 change from Community Commercial (C-1) to Light Industrial (M-1)
Second Reading / Adoption of Ordinance No. 1947, Approving, pursuant to an adopted Mitigated Negative Declaration and approved Mitigation Monitoring and Reporting Program for the Citrus and Boyle Project, Zoning District Map Amendment No. 22-009 to change the zoning designation for APN: 0251-151-10 from Community Commercial (C-1) to Light Industrial (M-1) for approximately 0.9 acres located on the north side of Slover Avenue, east of Citrus Avenue.

H. Adoption of Ordinance No. 1948 (Second Reading), a 21-2977 Development Agreement between the City of Fontana and
Chipt Fontana Citrus Avenue, L.P.

Second Reading / Adoption of Ordinance No. 1948, Approving, pursuant to an adopted Mitigated Negative Declaration, a Development Agreement No. 23-096 between the City of Fontana and Chipt Fontana Citrus Avenue, L.P., which provides a public benefit fee in the amount of $49,722.00. 22

I. Contractor Substitution Due to Job Abandonment and 21-2888 Bankruptcy from Previously Awarded Construction Contract for Public Works Concrete Maintenance Project (SB-107-PW-23) Approve and authorize the City Manager to execute a construction contract with Gentry General Engineering, Inc for the remaining work required to complete the construction of Public Works Concrete Maintenance Project in the amount of $168,840.00 (Bid No. SB-107-PW-23).

J. Approve an Agreement with the Inland Empire Utilities Agency, 21-2971 Speedway SBC Development, LLC, and San Bernardino
County for Wastewater Services for Speedway SBC
Development, LLC
Approve and authorize the City Manager to execute an agreement with the Inland Empire Utilities Agency (“IEUA”), Speedway SBC Development, LLC, and San Bernardino County (“County”) for wastewater services for Speedway SBC Development, LLC.

K. Fontana Community Senior Center Beauty Salon Lease 21-2935 Agreement

1. To authorize the Community Services Department to enter into a lease agreement with Boss Hair Studios to offer hair styling, nail and retail services at the Fontana Community Senior Center.

2. Authorize the City Manager or his designee to execute any documents necessary to effectuate said agreement.

L. Acceptance of Parcel Map No. 19712 and Abandonment of a 21-2938 Certain Portion of Right of Way of Coyote Canyon Road and Lytle Creek Road
Accept Parcel Map No. 19712 located northwest of Interstate 15 (I-15) and west of Sierra Avenue, along the south side of Lytle Creek Road, accept as public dedicated streets and easements, and authorize the Mayor and City Clerk to certify the abandonment of a certain portion of right of way of Coyote Canyon Road and Lytle Creek Road.

M. Approve a Bond Reduction for Tract No. 17041 - Lot 2 (In-tract 21-2940 Improvements) located within the Citrus Heights North Specific Plan (Shady Trails)
Approve a reduction of the Faithful Performance Bond, Labor and Material Bond, and the Warranty Bond posted by Taylor Morrison of California, LLC. for Tract 17041 - Lot 2, for the in-tract improvements consisting of street, street light, storm drain, and sewer, located within the Citrus Heights North Specific Plan (Shady Trails).

N. Fontana Auto Center - Pylon Sign Refurbishment 21-2941

1. Authorize City Manager to complete upgrades to the Fontana Auto Center 23

pylon signage in the amount of $127,710.

O. Issuance of Special Tax Bonds for CFD #111 (Monterado) 21-2946 Adopt Resolution No. 2024-018, of the City Council of the City of Fontana authorizing the issuance of City of Fontana Community Facilities District No. 111 (Monterado) Special Tax Bonds, Series 2024, in an aggregate principal amount of not to exceed $8,000,000, authorizing the execution and delivery of an Indenture, a Bond Purchase Agreement and a Continuing Disclosure Agreement, authorizing the distribution of an Official Statement in connection therewith and authorizing the execution of necessary documents and certificates and related actions.

P. Fontana Expanded Learning Program Services Agreement 21-2949 Approve the Fontana Expanded Learning Program Services Agreement.

Q. Approve the Sale of Real Property by the Successor Agency to 21-2954 the City of Fontana
Approve the Purchase of Real Property Identified as APN 0228-301-51 - Located at Citrus And South Highland Avenues - by The City of Fontana and Authorizing the City Manager To Negotiate and Execute a Purchase and Sale Agreement with the Successor Agency to the Fontana Redevelopment Agency
New Business Item A- Issuance of Special Tax Bond for CFD 21-2996 #111 (Monterado).

NEW BUSINESS:

A. Issuance of Special Tax Bonds for CFD #111 (Monterado) 21-2946 Adopt Resolution No. 2024-018, of the City Council of the City of Fontana authorizing the issuance of City of Fontana Community Facilities District No. 111 (Monterado) Special Tax Bonds, Series 2024, in an aggregate principal amount of not to exceed $8,000,000, authorizing the execution and delivery of an Indenture, a Bond Purchase Agreement and a Continuing Disclosure Agreement, authorizing the distribution of an Official Statement in connection therewith and authorizing the execution of necessary documents and certificates and related actions.

Accountant II Justin Marietta provided the staff report.

ACTION: Motion was made by Council Member Cothran, seconded by Council Member Roberts, and passed by a vote of 4-0 to approve New Business Item “A.” The motion carried by the following vote: AYES: Garcia, Cothran, Roberts, and Sandoval; NOES:

None; ABSTAIN: None; ABSENT: Warren
24

PUBLIC HEARINGS:

A. Ordinance No. 2024-1949: An Ordinance of the City Council of 21-2842 the City of Fontana, California, Pursuant to an Exemption from the California Environmental Quality Act, Approving a
Development Agreement with HS Fontana Retail, LLC,
concerning a retail cannabis business and Direct Staff to File a Notice of Exemption.

Based on the information in the staff report and subject to the findings, conclusions, and information in the staff report, resolution and presented in the public hearing, staff recommends that the City Council adopt Ordinance No. 2024-1949; and

1. Find, after review of the whole of the Project, including this Development Agreement, that the project is EXEMPT from the California Environmental Quality Act (“CEQA”), pursuant to State CEQA Guidelines Section 15301 (Existing Facilities) and direct staff to file a Notice of Exemption; and

2. Approve a Development Agreement with HS Fontana Retail, LLC, based upon the findings in the staff report and ordinance, pending adoption of an Operating Agreement with HS Fontana Retail, LLC.

3. Approve an Operating Agreement with HS Fontana Retail, LLC, as required by FMC 33-21.

Mayor Pro Tem Garcia opened the public hearing.

City Clerk Key stated that there was no written correspondence received.

Deputy City Manager Phillip Burum provided the staff report.

Council Member Sandoval asked if the proposed amendment to Section D of the development agreement, as presented in a memo to the Council in advance of the meeting, would be included in the motion.

Deputy City Manager Burum stated that Section D was modified to correct a typo that implied the owner would be a part of the development agreement when the agreement would be with the property owner or leasehold interest owner.

Council Member Sandoval asked if Community Benefit Funds could be used for other projects in the Southridge area such as a dog park instead of the proposed children’s museum.

Deputy City Manager Burum stated that a dog park was in development in the Southridge area and that a children’s museum would benefit the entire city and region. Also noted that the Community Benefit Fee was increased because the applicant would like to see a children’s museum developed in the downtown area. Stated that the development agreement could be amended at the Council’s direction, but the Community Benefit Fee would be lower with a 25

projected loss of $100,000 - $125,000 in revenue per year.

Discussion ensued regarding earmarking funds for specific purposes and the negotiation process of the Community Benefit Fee amount.

With no one interested to speak in favor or opposition of this item Mayor Pro Tem Garcia closed the Public Hearing.

ACTION: Motion was made by Council Member Roberts, seconded by Council Member Cothran, and passed by a vote of 4-0 to approve Public Hearing Item “A” to include an amendment to Ordinance 1949, Page 7, Section D as follows:

D. Permittee currently owns legal or equitable interest or leasehold in real property considered in this Agreement, located at 11275 Sierra Avenue, Suite 3-E, City of Fontana, County of San Bernardino, State of California (the “Site”). The Site includes Assessor’s Parcel Numbers: 0194-381-46 as is more fully described in Exhibit A and shown on the map in Exhibit B, both exhibits being attached hereto and incorporated herein by this reference.

The motion carried by the following vote: AYES: Garcia, Cothran, Roberts, and Sandoval; NOES: None; ABSTAIN: None; ABSENT: Warren
CITY MANAGER COMMUNICATIONS:

A. City Manager Communications
City Manager Matthew Ballantyne did not have any comments.

ELECTED OFFICIALS COMMUNICATIONS/REPORTS:

A. Elected Officials Communications/Reports
City Treasurer Koehler-Brooks thanked the Fontana Chamber of Commerce for the recent dinner honoring police and fire personnel.

City Clerk Key congratulated the Fontana Police Department Employees of the Month.

Council Member Cothran discussed a recent ride-a-long with the Police Department and thanked public safety personnel.

Council Member Sandoval also thanked the police officers along with the captains and police chief, fire staff and school public safety staff. Also discussed the League of California Cities Leadership Summit he attended and wished happy birthday to his daughter Cecilia, son Jesse, his dad and grandson Tommy.

Council Member Roberts congratulated police and fire staff for an outstanding job at keeping Fontana one of the safest cities.
26

Mayor Pro Tem Garcia discussed the League of California Cities Leadership Summit he attended and the recent Fontana Chamber of Commerce dinner honoring police and fire personnel. Also discussed the recent Safewise report ranking Fontana as one of the safest cities in California and congratulated city staff and public safety staff.

ADJOURNMENT:

A. Adjournment
Mayor Pro Tem Garcia and the City Council led a moment of silence in memory of the following individual:

1. Gil Navarro
Mayor Pro Tem Garcia adjourned the meeting at 3:13 p.m. to the next Regular City Council Meeting on Tuesday, May 14, 2024, at 2:00 p.m. in the Grover W. Taylor Council Chambers located at 8353 Sierra Avenue, Fontana, California.
_____________________
Christina Rudsell, CMC
Deputy City Clerk

THE FOREGOING MINUTES WERE ADOPTED AND APPROVED BY THE FONTANA CITY COUNCIL ON MAY 14, 2024.
_______________________
Germaine Key
City Clerk
27 City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2993 Agenda Date: 5/14/2024
Agenda #: B. Category: Consent Calendar
FROM:

Planning Department
SUBJECT:

Adoption of Ordinance No.1949 (Second Reading), Approve a Development Agreement with HS Fontana Retail, LLC.

RECOMMENDATION:

Adoption of Ordinance No. 1949 on Second Reading, Pursuant to an Exemption from the California Environmental Quality Act, Approving a Development Agreement with HS Fontana Retail, LLC, concerning a retail cannabis business and Direct Staff to File a Notice of Exemption.

COUNCIL GOALS:
· Promote economic development by concentrating on job creation. · To promote economic development by pursuing business retention, expansion, and attraction. · To promote economic development by striving to constantly improve the city's competitiveness.

DISCUSSION:

Ordinance No. 1949 was introduced by a vote of 4-0 at the April 23, 2024, Regular City Council meeting.

FISCAL IMPACT:

New revenue, in the form of special fees paid to the City, resulting from execution of this Development Agreement is currently projected to exceed $700,000 annually.

MOTION:

Approve staff recommendation.

City of Fontana Page 1 of 1 Printed on 5/8/2024
powered by Legistar™ 28
ORDINANCE NO. 1949

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

FONTANA, CALIFORNIA, PURSUANT TO AN EXEMPTION

FROM THE CALIFORNIA ENVIRONMENTAL QUALITY

ACT, APPROVING A DEVELOPMENT AGREEMENT WITH

HS FONTANA RETAIL, LLC, CONCERNING A RETAIL

CANNABIS BUSINESS, AND DIRECT STAFF TO FILE A

NOTICE OF EXEMPTION
WHEREAS, California Government Code Sections 65864 et seq. (“Development Agreement Statutes”) and Section 30-322 of the City’s Development Code authorizes the City Council of the City of Fontana to enter into a development agreement with those having a legal or equitable interest in real property in order to establish certain development rights in such property; and to strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development in connection with the development of real property within its jurisdiction; and
WHEREAS, Planning Commission has found that development agreements will strengthen the public planning process, encourage private participation in comprehensive planning by providing a greater degree of certainty in that process, reduce the economic costs of development, allow for the orderly planning of public improvements and services, allocate costs to achieve maximum utilization of public and private resources in the development process, and ensure that appropriate measures to enhance and protect the environment are achieved; and
WHEREAS, pursuant to Section 30-322 of the City’s Development Code and Section 4 of City Council Resolution No. 85-217, the Planning Commission shall conduct a public hearing concerning any proposed development agreement in accordance with Government Code Section 65867 and shall, by resolution, render a recommendation to the City Council concerning the proposed development agreement, including the reasons for the recommendation and the relationship of the proposed development agreement to applicable general and specific plans and zoning requirements; and WHEREAS, on July 26, 2022, in accordance with state law, the City Council adopted Ordinance No. 1899 adding Chapter 33 to the Fontana Municipal Code (“FMC”) to regulate commercial cannabis businesses within the City by establishing a regulatory permit scheme for commercial cannabis activities, such that each proposed commercial activity must have a regulatory permit and enter into a development agreement and operating agreement with the City Council; and
WHEREAS, on October 25, 2022, the City Council adopted Ordinance No. 1906 amending FMC Chapter 30 and Chapter 33 to rename “commercial cannabis” to 29 “cannabis retailer-storefront” and reference special regulations for same and to make minor modifications to FMC Chapter 33 related to phasing, authorization letters, and locations for permit applications along with limiting the number of permits to be issued to any applicant to one; and
WHEREAS, Section 33-7 of the FMC limits the maximum number of commercial cannabis businesses authorized and designated locations to three, one in the north area, one in the central area and one in the south area of the City; and WHEREAS, the City of Fontana received an application from HS Fontana Retail, LLC, (the “Applicant”) on May 3, 2023 for a Retail Commercial Cannabis Business Activity Permit for a location within the south area of the City, and on January 24, 2024 received a request for a development agreement with the Applicant (collectively the “Project”) to establish certain assurances including timing and the provision of public benefits for a commercial cannabis retail sales business at the Project site, an approximately 4,475 square feet of commercial building area on an approximately 1.50 to 3.50 acres, Project Applicant: HS Fontana Retail, LLC
2151 E. Convention Center Way, Suite 235
Ontario, CA 91764
Project Location: The project site is located at 11275 Sierra Avenue, Suite 3-E (APN: 0194-381-46)
WHEREAS, the Project site is within the General Plan Land Use Designation of General Commercial (C-G) and is zoned General Commercial (C-2); and WHEREAS, when the application for the retail commercial cannabis business activity permit was submitted by the Applicant, the zoning designation was verified as permissible by the City on May 3, 2023 for the Project site, located in the General Commercial (C-2), a permissible zoning district where a commercial cannabis business could operate in the City; and
WHEREAS, on September 19, 2023, the Applicant was notified of its top-ranking and of being selected/approved for a Commercial Cannabis Regulatory Permit, effectively establishing the use at the Project site; and
WHEREAS, the City wishes to protect and preserve the quality of life throughout the City, through careful consideration of the proposed development agreement and imposition of the requirements of FMC Chapter 33 upon the Applicant; and WHEREAS, the City and the Applicant agree that, as a condition of allowing the Project, as further defined in the proposed Development Agreement, and due to the unique circumstances of the proposed Project, the Applicant shall be entitled to the assurances timeframes identified in the Development Agreement and shall in turn provide public benefits, including by paying to the City a percentage of gross receipts of the 30 Applicant’s commercial cannabis retail sales by providing benefits to nonprofit organizations within the City and priority to and opportunities for local jobs, and work for the residents and contractors of the City; and
WHEREAS, because of the logistics, magnitude of the expenditure, and considerable lead time required to plan and develop the Property, HS Fontana Retail, LLC has proposed to enter into a development agreement concerning the Property (“Development Agreement”), to provide assurances that the Property can be developed without disruption caused by a change in the City’s planning policies and requirements except as provided in the Development Agreement, which assurances will thereby reduce the actual or perceived risk of planning for and proceeding with development of the Property; and
WHEREAS, Applicant's interest in the Property, including that interest reflected in the Development Agreement, constitutes a legal or equitable interest in real property pursuant to California Government Code section 65865; and WHEREAS, the Applicant proposes to develop and operate a commercial cannabis retail business in an approximately 4,475 square feet commercial building area on an approximately 1.501 to 3.500 acre lot which includes minor interior tenant improvement; and
WHEREAS, the terms and conditions of the Development Agreement have undergone review by the Planning Commission at a publicly noticed hearing held on April 2, 2024 and recommended that the City Council enter into the Development Agreement; WHEREAS, the terms and conditions of the Development Agreement have undergone review by the Planning Commission at a publicly noticed hearing and have been found to be fair, just and reasonable, and that (i) the economic interests of the City's citizens and the public health, safety and welfare will be best served by entering into the Development Agreement; (ii) the Development Agreement is consistent with the General Plan; (iii) the Development Agreement is in conformity with the public convenience, general welfare and good land use practice; (iv) the Development Agreement will not be detrimental to the public health, safety and general welfare; and (v) the Development Agreement will not adversely affect the orderly development or the preservation of property values for the Property or any other property; and WHEREAS, pursuant to the California Environmental Quality Act (“CEQA”) (Public Resources Code §21000 et seq.) and the State CEQA Guidelines (Cal. Code Regs.,tit. 14, §15000 et seq.), the whole of the Project, including the Development Agreement, has been reviewed and found to be exempt from CEQA pursuant to State CEQA Guidelines Section 15301, Existing Facilities and a Notice of Exemption will be filed upon adoption of this Resolution; and
WHEREAS, notice of the public hearing was duly published and posted in accordance with all legal requirements; and
31 WHEREAS, all other legal prerequisites to the adoption of this resolution have occurred.

THE CITY COUNCIL OF THE CITY OF FONTANA DOES ORDAIN AS
FOLLOWS:

Section 1. Recitals. The above recitals are true, correct and incorporated herein by reference.

Section 2. Pursuant to California Government Code sections 65865 et seq., the City Council hereby approves the development agreement on file with the City Clerk and incorporated by reference herein, entitled "Development Agreement No. 24-003 among the City of Fontana and HS Fontana Retail, LLC.".

Section 3. Based on the entire record before the City Council and all written and oral evidence presented to the City Council, the City Council finds this Ordinance promotes the public health, safety, and welfare of the community because the Development Agreement will enable needed improvements at the Property and the economic development within the Property, its surrounding communities and the citizens of the City.

Section 4. Pursuant to Government Code section 65868.5, within 10 days following the entering into of the Development Agreement, as evidenced by the full execution thereof, the City Clerk shall cause to be recorded with the San Bernardino County Recorder a copy of the executed Development Agreement.

Section 5. CEQA. The whole of the Project, including the Development Agreement, has been reviewed and found to be exempt from California Environmental Quality Act (“CEQA”) pursuant to State CEQA Guidelines Section 15301, Existing Facilities, as the cannabis retail use will be located in an existing commercial facility with no proposed expansion to the building and only making minor interior improvements.

Section 6. This Ordinance shall take effect thirty (30) days after the date of its adoption, and prior to the expiration of the fifteen (15) days from the passage thereof, the Ordinance or a summary of the Ordinance shall be published at least once in the Herald News, a newspaper of general circulation in the City of Fontana. Thereafter this Ordinance shall be in full force and effect.

APPROVED AND ADOPTED this 14th day of May, 2024.
32 READ AND APPROVED AS TO LEGAL FORM:
________________________________
City Attorney
I, Germaine Key, City Clerk of the City of Fontana, and Ex-Officio Clerk of the City Council, do hereby certify that the foregoing Ordinance is the actual Ordinance introduced at a regular meeting of said City Council on the 23rd day of April, 2024, and was finally passed and adopted not less than five days thereafter on the 14 th day of May, 2024 by
the following vote to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:
________________________________
City Clerk of the City of Fontana
_______________________________
Mayor of the City of Fontana
ATTEST:
_______________________________
City Clerk
33 EXHIBIT A

DEVELOPMENT AGREEMENT

WITH HS FONTANA RETAIL, LLC DBA HIGH SEASON

RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

City of Fontana
8353 Sierra Ave.

Fontana, CA 92335
Attention: City Clerk
SPACE ABOVE THIS LINE FOR RECORDER’S USE
Recording Fee Exempt per Government Code § 6103

DEVELOPMENT AGREEMENT
THIS DEVELOPMENT AGREEMENT (this “Agreement”) is made and entered into this __th day of _____________, 2024 (the “Execution Date”), by and between the CITY OF FONTANA, a California municipal corporation (“City”) and (“HS Fontana Retail, LLC dba High Season” ), with its principal address located at 2151 E. Convention Center Way, Suite 235 Ontario California 91764, (“Permittee”). City and Permittee are sometimes referenced together herein as the “Parties.” In instances when a provision hereof applies to each of the Parties individually, either may be referenced as a “Party.” The Parties hereby jointly render the following statement as to the background facts and circumstances underlying this Agreement.

RECITALS
A. The State of California enacted California Government Code sections 65864 et seq. (“Development Agreement Statutes”) to authorize municipalities to enter into development agreements with those having a legal or equitable interest in real property to strengthen the public planning process, encourage private participation in comprehensive planning, and reduce the economic risk of development in connection with the development of real property within their jurisdiction.

B. The purpose of the Development Agreement Statutes is to authorize municipalities, in their discretion, to establish certain development rights in real property for a period of years regardless of intervening changes in land use regulations, to vest certain rights, and to meet certain public purposes of the local government.

C. As authorized by the Development Agreement Statutes, the City has adopted Municipal Code Section 30-322 establishing the procedures and requirements for the consideration of development agreements with the City.
34 D. Permittee currently owns legal or equitable interest or leasehold in real property considered in this Agreement, located at 11275 Sierra Avenue, Suite 3-E, City of Fontana, County of San Bernardino, State of California (the “Site”). The Site includes Assessor’s Parcel Numbers: 0194-381-46 as is more fully described in Exhibit A and shown on the map in Exhibit B, both exhibits being attached hereto and incorporated herein by this reference.

E. On September 13, 2016, the City Council adopted Ordinance No. 1747 prohibiting all marijuana uses in the City to the extent allowed under California and included a provision requiring a Residential Indoor Marijuana Cultivation (“RIMC”) permit for any individual who desires to grow up to six (6) marijuana plants in their private residence.

F. On November 8, 2016, California voters approved Proposition 64, titled the “Adult Use of Marijuana Act” (the “AUMA”) and enacted a state statutory scheme legalizing, controlling, and regulating the cultivation, processing, manufacturing, distribution, testing, and sale of nonmedical (“adult-use” or “recreational”) cannabis, including cannabis products, for use by adults twenty-one (21) years of age and older.

G. On June 27, 2017, Governor Brown signed Senate Bill 94, the “Medicinal and Adult- Use Cannabis Regulation and Safety Act” (“SB 94” or the “MAUCRSA”). SB 94 creates one state regulatory structure for medical and adult-use cannabis use and commercial cannabis activities, reconciling AUMA, with Proposition 215 and MAUCRSA. SB 94 continues to provide that a state license will not be approved for a business to engage in Commercial Cannabis Activity if the business activity violates any local ordinance or regulation.

H. The City Council adopted Ordinance No. 1899, on July 12, 2022, as amended on October 25, 2022, establishing a regulatory permit scheme for commercial cannabis activities, such that each proposed commercial activity must have an agreement and a regulatory permit prior to operation.

I. Presently, Permittee intends to utilize the Site for the sale of cannabis. Permittee is an authorized corporation as allowed by law duly formed under California law for the purpose of commercial cannabis sales (“Commercial Cannabis Activity”). Such Commercial Cannabis Activity facilities shall operate in accordance with the California State Compassionate Use Act (Health & Saf.Code, § 11362.5) (“CUA”), the Medical Marijuana Program Act (Health & Saf. Code, §§ 11362.7 et seq.) (“MMP”), the Control, Regulate and Tax Adult Use of Marijuana Act of 2016 (“AUMA”), and the Medicinal and Adult Use Regulation and Safety Act (“MAUCRSA”), Fontana Municipal Code Ordinance Chapter 33 and regulations promulgated thereunder, and any additional California state law related to Commercial Cannabis Activity (collectively “State Cannabis Law”). Prior to operating a Commercial Cannabis Activity facility, Permittee shall be required to obtain a Commercial Cannabis Activity regulatory permit from City pursuant to City ordinance.

J. Permittee shall obtain all required state licenses issued under State Cannabis Law.

K. Pursuant to the California Environmental Quality Act (“CEQA”) (Public Resources Code §21000 et seq.) and the State CEQA Guidelines (Cal. Code Regs.,tit. 14, §15000 et seq.), the whole of the Project, including the Development Agreement, has been reviewed and 35 found to be exempt from CEQA pursuant to State CEQA Guidelines Section 15301, Existing Facilities and a Notice of Exemption will be filed upon adoption of this Resolution.

L. Permittee presently intends to develop and open Commercial Cannabis Activity facilities (“Commercial Cannabis Activity Facility”) on the Site consistent with State Cannabis Law, all other applicable California law, and Project Approvals (known as the “Project”).

M. The Project will include commercial retail cannabis sales to individuals under State Cannabis Law at the Project Site (“Commercial Cannabis Activity Facility”).

N. The Project will consist of a total planning area of approximately 4475 square feet of commercial building area on a lot of approximately 1.501 to 3.500 acres. The Project is designed to integrate seamlessly into the City of Fontana’s General Plan Goals and Policies for Commercial Districts, including the latest provisions for Commercial Cannabis Activity. The Project includes interior improvements to the existing building.

O. City and Permittee have agreed that, as a condition of allowing the Project, as defined herein, and due to the unique circumstances of the proposed Project, shall pay to the City a retail fee based on the gross receipts of Developer’s commercial cannabis retail sales, as hereinafter defined.

P. City has given public notice of its intention to adopt this Agreement and has conducted public hearings thereon pursuant to California Government Code section 65867 and Municipal Code Section 30-322. City has found that the provisions of this Agreement and its purposes are consistent with the objectives, policies, general land uses and programs specified in City’s General Plan, zoning code and municipal ordinances.

Q. City, in entering into this Agreement, acknowledges that certain City obligations hereby assumed shall survive beyond the terms of the present City Council members, that this Agreement will serve to bind City and future City Councils to the obligations hereby undertaken, and that this Agreement shall limit the future exercise of certain governmental and proprietary powers of City. By approving this Agreement, the City Council has elected to exercise certain governmental powers at the time of entering into this Agreement rather than defer its actions to some undetermined future date. The terms and conditions of this Agreement have undergone extensive review by City staff, the Planning Commission, and the City Council and have been found to be fair, just, and reasonable. City has concluded that the pursuit of the Project will serve the best interests of its citizens and that the public health, safety, and welfare are best served by entering into this Agreement. Permittee has represented to City that it would not consider or engage in the Project absent City approving this Agreement, i.e., assuring Permittee that it will enjoy the development rights given in this Agreement. The City Council specifically finds that this Agreement satisfies each and every one of the required findings in Municipal Code Section 30-322. .

R. The City agrees that Permittee’s land use entitlements for the Project shall vest for the term of this Agreement as described below, including, but not limited to, the right to commercial 36 cannabis retail sales and related development in compliance with State Cannabis Law and local ordinances.

S. After conducting a duly noticed hearing on April 2, 2024, in conjunction with Section 30- 322 of the City’s Municipal Code, the Planning Commission of the City reviewed, considered, and approved Resolution No. PC 2024-026. The Planning Commission found the Project consistent with the objectives, policies, general land uses and programs specified in the general plan; compatible with the uses authorized in the General Commercial (C-G) ; is in conformity with the public necessity, public convenience, general welfare and good land use practices; will not be detrimental to the health, safety and general welfare of the city; will not adversely affect the orderly development of property or the preservation of property values; and will have a positive fiscal impact on the City.

T. After conducting a duly noticed hearing on April 23, 2024, in conjunction with Section 30- 322 of the City’s Municipal Code, and after independent review and consideration, the City Council approved the execution of this Agreement. The City Council found the Project consistent with the objectives, policies, general land uses and programs specified in the general plan; compatible with the uses authorized in the Commercial zone; is in conformity with good land use practices; will not be detrimental to the health, safety and general welfare of the City; and is in the best interest of the City of Fontana and its residents.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the Parties do hereby agree as follows:

1. Binding Effect of Agreement. The Parties agree that the Recitals above are true and correct and intend to be bound by same; the Parties further agree to the incorporation by reference herein of said Recitals, together with all definitions provided and exhibits referenced therein. This Agreement pertains to the Site as described in Exhibit A and shown in Exhibit B. Except as otherwise provided in Section 15 of this Agreement, the burdens of this Agreement are binding upon the Permittee. In order to provide continued notice thereof, the Parties will record this Agreement with the San Bernardino County Recorder. Should the size or orientation of any Site component specified above be changed in minor respects, e.g., changed by a lot line adjustment, this Agreement shall not thereby be deemed to have been affected or invalidated, but the rights and obligations of the Parties shall remain as provided herein.

2. Relationship of the Parties. It is hereby specifically understood and acknowledged that the Project is a private project and that neither City nor Permittee will be deemed to be the agent of the other for any purpose whatsoever. City and Permittee hereby renounce the existence of any form of joint venture or partnership between or among them and agree that nothing contained herein or in any document executed in connection herewith shall be construed as making City and Permittee joint venturers or partners.

3. Term. Except as otherwise specified herein, the term of this Agreement (the “Term”) shall be for three (3) years from the Execution Date. The Term shall generally be subject to earlier termination or extension as hereinafter provided. 37 3.1 Term Extension. This Agreement shall be subject to two (2) year extensions at the sole discretion of the City. The City Manager is authorized to enter into the term extensions after conducting a periodic review in accordance with Government Code section 65865.1. If at the sole discretion of the City, the City finds that Permittee demonstrates to have complied in good faith with the terms and conditions of this Agreement, the Parties may enter into a written extension signed by both Parties.

3.2 Request by Permittee of Term Extension. The Term of this Agreement may be extended at the request by Permittee by written notice no later than one hundred twenty (120) calendar days before the expiration of the term and Permittee shall not be in default with respect to any provision of this Agreement or any subsequent agreement or understanding between the Parties arising from or related to this Agreement, having received notice from City of said default per this Agreement, or if Permittee did in fact default as to this Agreement, upon notice from City, that Permittee did cure said default during the period to cure provided herein to City’s satisfaction.

3.3 Termination of Agreement. Upon the termination of this Agreement, either by expiration or otherwise, Permittee shall have no right to engage in Commercial Cannabis Activity at the Project Site, except as may otherwise be allowed by City ordinance or law.

4. Defined Terms. As used in this Agreement, the following terms shall have the meanings hereinafter set forth:

4.1 Certified Report. “Certified Report” shall mean a detailed document prepared by Permittee on a form acceptable to the City’s Director of Finance to report to City of the sales by Permittee, as defined herein, in the Project during each Operational Quarter, as defined herein. Each Certified Report shall be certified as true and correct by a duly authorized officer of Permittee. City may also require certification by Permittee.

4.2 Certification of Non-Income Tax Exemption. Permittee certifies that Permittee is not income tax exempt under State or Federal Law and that Permittee will not file for such an exemption from the Internal Revenue Service or the Franchise Tax Board. Permittee will also require all Tenant(s) to certify that Tenant(s) are not income tax exempt under State or Federal Law and will not file for such an exemption.

4.3 Gross Receipts. Except as otherwise specifically provided, means the total amount actually received or receivable from all sales and transfers; the total amount of compensation actually received or receivable for the performance of any act or service, of whatever nature it may be, for which a charge is made or credit allowed, whether or not such act or service is done as a part of or in connection with the sale of materials, goods, wares or merchandise; and discounts, gifts, rents, royalties, fees, commissions, dividends, and gains realized from trading in stocks or bonds, however designated. Included in “gross receipts” shall be all receipts, cash, credits and property of any kind or nature, without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor or service costs, interest paid or payable, or losses or other expenses whatsoever, except that the following shall be excluded therefrom:

4.3.1 Cash discounts were allowed and taken on sales;
38 4.3.2 Credit allowed on property accepted as part of the purchase price and which property may later be sold, at which time the sales price shall be included as gross receipts;

4.3.3 Any tax required by law to be included in or added to the purchase price and collected from the consumer or purchaser;

4.3.4 Such part of the sale price of any property returned by purchasers to the seller as refunded by the seller by way of cash or credit allowances or return of refundable deposits previously included in gross receipts;

4.3.5 Receipts derived from the occasional sale of used, obsolete or surplus trade fixtures, machinery or other equipment used by the taxpayer in the regular course of the taxpayer’s business; and

4.3.6 Receipts of refundable deposits, except that such deposits when forfeited and taken into income of the business shall not be excluded when in excess of one dollar.

4.3.7 Retail sales of non-cannabis products, such as t-shirts, sweaters, hats, stickers, key chains, bags, books, posters, rolling papers, cannabis accessories such as pipes, pipe screens, vape pen batteries (without cannabis) or other personal tangible property.

4.4 Operational Quarter. “Operational Quarter” shall mean any calendar quarter, or portion of a calendar quarter, during which any Gross Receipts of the Project is produced, as defined herein. The calendar quarters shall begin and end as follows: January 1 through March 31; April 1 through June 30; July 1 through September 30; and October 1 through December 31.

4.5 Land Use Regulations. “Land Use Regulations” shall mean all ordinances, resolutions, codes, rules, regulations and official policies of the City governing the development and use of land, including, without limitation, the permitted use of land, the density or intensity of use, subdivision requirements, timing and phasing of development, the maximum height and size of buildings, the provisions for reservation or dedication of land for public purposes, and the design, improvement and construction and initial occupancy standards and specifications applicable to the Project. “Land Use Regulations” do not include any City ordinance, resolution, code, rule, regulation or official policy governing:

4.5.1 The conduct or taxation of businesses, professions, and occupations applicable to all businesses, professions, and occupations in the City;

4.5.2 Other than as provided in this Agreement, taxes and assessments of general application upon all residents of the City, provided that the taxes and assessments are not imposed for the purpose of taxing the right, power or privilege of developing or improving land (e.g., excise tax) or to directly finance the acquisition or dedication of open space or any other public improvement in respect of which the Developer is paying any fee or providing any improvement pursuant to this Agreement;

4.5.3 The control and abatement of nuisances;
39 4.5.4 The granting of encroachment permits and the conveyance of rights and interests which provides for the use of, access to or the entry upon public property, as may be approved by mutual agreement between Developer and City; and

4.5.5 The exercise of the power of eminent domain.

4.6 Existing Land Use Regulations. “Existing Land Use Regulations” means all Land Use Regulations in effect as of the approval date of this Agreement, including the Project Approvals.

4.7 Retail Fee. Shall mean five percent (5%) of Gross Receipts due to the City at the end of each Operational Quarter

5. Fee Payments.

5.1 Fee Payments. In consideration of City’s entering into this Agreement and authorizing the development and operation of the Project, the requirements for City services created by the Project, the City ensuring compliance with this Agreement, State Cannabis Laws, and the City’s municipal ordinances, throughout the Term of this Agreement, the following payments shall be made to City:

5.1.1 Retail Fee shall be paid quarterly. Retail Fees shall be due to the City by the 15th of each month succeeding Operational Quarter. Failure to pay the Retail Fee within thirty 30 days after the due date shall result in an additional penalty for nonpayment in a sum equal to twenty-five (25%) of the total amount due. The provisions of this subsection shall survive any termination or expiration of this Agreement for any reason.

5.2 Community Benefits. Permittee shall contribute the greater of one percent (1%) of its Gross Receipts or $250,000 annually (“Community Benefit Contribution” or “CBC”), which funds shall exclusively be used in support of the design, development, construction, or operation of a children’s museum or affiliated services, operations, and appurtenant uses of a children’s museum to be constructed in the downtown area of the City of Fontana. CBC Payments shall be made annually for the term of this agreement, as extended. CBC contributions equal to 1% shall be calculated on an annual calendar year basis with payments of $250,000 or 1% of Gross Receipts, whichever is greater, due and payable on or before March 1 of the year following calendar year. By way of example, CBC payments for calendar year 2024 shall be made on or before March 1, 2025. All funds are to be directed by The Fontana Community Foundation, which shall direct expenditures as appropriate for the design, development, construction, or operation of the children’s museum or appurtenant uses. Permittee must provide a written record of all funds and their recipients, provided to the City each year during the renewal process.

5.2.1 Permittee shall encourage employees of Permittee to provide individual volunteer services within the Fontana Community. Employees that provide verifiable volunteer service to the Fontana community shall be entitled to compensation by Permittee at their regular pay rate for up to 40 hours annually. Verification of service performed shall be in the sole discretion of Permittee. Permittee shall provide documentation to City of any such employee volunteer services.
40 5.2.2 The provisions of this subsection shall survive any termination or expiration of this Agreement for any reason.

6. Payment Procedures. The following procedures shall apply during the operation of the Project:

6.1 Remittance of Retail Fees/Certified Reports. Within thirty (30) calendar days following the end of each Operational Quarter during the Term of this Agreement commencing with the first Operational Quarter in which the Project has commenced, Permittee shall submit the Certified Report to the City’s Finance Director and a payment for the Retail Fees for that Operational Quarter as identified in the Certified Report. Permittee shall pay Retail Fees to City on a quarterly basis without exception. Any material misstatement or misrepresentation in the Certified Report and any failure to pay Retail Fees when due shall constitute events of default by Permittee subject to the default provisions of this Agreement.

6.2 Maintenance of Records. Permittee shall maintain complete records of its operations to substantiate and document the content of each Certified Report. Such records shall include, without limitation, invoices and payments taken by Permittee and/or any operator of the Commercial Cannabis Facility. Permittee shall maintain such records in a form and location reasonably accessible to City, following reasonable notice to Permittee, for a period of at least five (5) calendar years following Permittee’s submission of the Certified Report to which the records apply.

6.3 Audit. The City may conduct an audit or arrange for a third-party independent audit, at Permittee’s expense, of Permittee records regarding Certified Reports and the Gross Receipts, at the sole discretion of the City. Such audit would not occur more than twice in one calendar year. The City’s Finance Director shall provide at least seven (7) business days written notice of the commencement of such audit to Permittee and shall reasonably attempt to schedule the audit so as to reduce the impact on Permittee operations as much as is feasible.

Permittee shall cooperate with the City in completing the audit. If the audit reveals that Permittee has underpaid the payment due at the end of any Operational Quarter, Permittee shall pay such underpaid amounts to the City within thirty (30) calendar days of receipt of written notice from the City’s Director of Finance. If the underpaid amount is more than five percent (5%) of the amount due, Permittee shall pay a penalty of an additional ten percent (10%) of Gross Receipts for first time underpayment and an additional twenty-five percent (25%) of Gross Receipts for any subsequent violations of the payment due at the end of the Operational Quarter. If the audit reveals that the Permittee has overpaid any amount of the Gross Receipts, City shall provide written notification to Permittee and shall credit such amount against Permittee’s subsequent quarterly payments of Gross Receipts until the overpaid amount has been resolved.

6.4 Site Inspection. From time to time, the City has the right to inspect the Facility for the purpose of monitoring operations, checking quantities, and verifying volumes of product during operating hours or any time deemed appropriate to insure accurate reporting. The City must give notice at least forty-eight (48) hours in advance of any inspection.

7. Covenants of Permittee. During the Term of this Agreement, Permittee hereby covenants and agrees with the City as follows:
41 7.1 Implementation. Permittee shall use commercial reasonable efforts to pursue the implementation of the Project as expeditiously as feasible, in the form approved by the City, subject to all applicable laws, this Agreement, the Operating Agreement, the Commercial Cannabis Permit and the Municipal Code.

7.2 Maintain & Operate Project. Permittee shall maintain and operate the Project on the Site, throughout the Term of this Agreement, in accordance with the Project Approvals and all City, State and Federal laws.

8. Indemnification. Permittee shall defend (with Counsel reasonably approved by the City), indemnify, and hold harmless the City and its Council, boards and commissions, officers, officials, employees, and agents from and against any and all actual and alleged liabilities, demands, claims, losses, damages, injuries, actions or proceedings and costs and expenses incidental thereto (including costs of defense, settlement and attorney’s fees), which arise out of, or which are in any way related to i) the cannabis business permit and any land use entitlement related thereto, ii) the proceedings undertaken in connection with the approval, denial, or appeal of the cannabis business permit and any land use entitlement related thereto, iii) any subsequent approvals or licensing/permits relating to the cannabis business permit and any land use entitlement related thereto, iv) the processing of the cannabis business permit and any land use entitlement related thereto, v) any amendments to the approvals for the cannabis business permit and any land use entitlement related thereto, vi) the City’s approval, consideration, analysis, review, issuance, denial or appeal of the cannabis business permit; vii) the City’s approval, consideration, analysis, review, issuance, denial or appeal of any land use entitlement related thereto, viii) the City’s drafting, adoption and passage of an ordinance, and related resolutions, policies, rules and regulations, allowing for cannabis businesses, ix) the City’s drafting, adoption and passage of an ordinance, and related resolutions if necessary in the future regarding any zoning law amendment(s) related to Permittee, x) the operation of Project or activity, xi) the process used by the City in making its decision to approve, consider, analyze, review, issue, or deny, my cannabis business permit or any related land use entitlement, or the appeal of either, xii) City’s compliance or failure to comply with applicable laws and regulations or xiii) the alleged violation of any federal, state or local laws by Permittee or any of its officers, employees or agents, except where such liability is caused by the sole negligence or willful misconduct of the City.

8.1 City may (but is not obligated to) defend such challenge as City, in its sole discretion, determines appropriate, all at applicant’s sole cost and expense. Permittee shall bear any and all losses, damages, injuries, liabilities, costs, and expenses (including, without limitation, staff time and in-house attorney’s fees on a fully-loaded basis, attorney’s fees for outside legal counsel, expert witness fees, court costs, and other litigation expenses) arising out of or related to any challenge (“Costs”), whether incurred by Permittee, City, or awarded to any third party, and shall pay to the City upon demand any Costs incurred by the City.

8.2 Permittee shall fund a deposit account (“Fund”) to reimburse the City’s cost, including attorney’s fees, to defend any claim, action, or proceeding that is or may be subject to the agreement on limitations of City’s Liability, and Certifications, Assurances Warranties, and Indemnification to City. In the event that any such claim, action, or proceeding is filed against the City, Permittee shall within 30 days of the filing deposit an initial sum of $25,000 to the Fund to 42 reimburse my portion of the City defense costs, as determined by the City in its sole discretion.

The Fund shall, once established, shall at all times contain an amount necessary to cover not less than three months’ worth of budgeted expenditures by the City relating to the City’s defense of the claim, action, or proceeding, including all time to appeal, or as long as expenditures made by the City relating to its defense remain unreimbursed, whichever is later. The City may, from time to time, in the City’s sole and absolute discretion, request additional deposits from the Permittee to ensure the fund balance is adequate to defend any claim, action or proceeding, including appeals related thereto. Once all remaining and outstanding reimbursements have been paid to the City by Permitee, City shall return to me any remaining unused portion of my deposit.

8.3 The provisions of this subsection shall survive any termination or expiration of this Agreement for any reason.

9. Hold Harmless.

9.1.1 Permittee hereby waives, releases, and holds harmless the City of Fontana (“City”) and its Council, boards and commissions, officers, officials, employees, and agents from any and all actual and alleged claims, losses, damages, injuries, liabilities, costs (including attorney’s fees), suits or other expenses which arise out of, or which are in any way relate to my application for a cannabis business permit, the issuance of the cannabis business permit, the process used by the City in making its decision, the enforcement of the conditions of the cannabis business permit, or the cannabis business’ operations.

9.1.2 Permittee hereby waives, releases and holds harmless the City and its Council, boards and commissions, officers, officials, employees, and agents from any and all actual and alleged claims, losses, damages, injuries, liabilities, costs (including attorney’s fees), suits or other expenses which arise out of, or which are in any way relate to: (1) any repeal or amendment of any provision of the Fontana Municipal Code or Zoning Ordinance relating to commercial cannabis activity; or (2) any investigation, arrest or prosecution of Permittee, operators, employees, clients or customers, for a violation of state or federal laws, rules or regulations relating to cannabis activities.

9.1.3 The provisions of this subsection shall survive any termination or expiration of this Agreement for any reason.

10. Covenants of City. During the Term of this Agreement, City hereby covenants and agrees with Permittee as follows:

10.1 Expeditious Services. City shall process applications and address questions and concerns raised by Permittee representatives at the “counter” at City Hall as expeditiously as reasonably possible. Upon Permittee’s request, or if, in an exercise of City’s own discretion, City staff determines that it cannot comply with this Section, City shall expeditiously engage the services of private contract planners, plan checkers or inspectors (“Private Contractors”) to perform such services as may be necessary to assist in processing the project plans as described herein. Compensation of such Private Contractors shall be at Permittee’s sole cost and expense, inclusive of any administrative cost to City of integrating services by Private Contractors into the project’s development processing. Permittee shall pay such costs and expenses of Private 43 Contractors via reimbursement to City, per City’s applicable policies and procedures. City shall have absolute discretion in the selection of such Private Contractors.

10.2 Vested Rights. During the term of this Agreement, Permittee shall have the vested right and entitlement to develop and operate the Project in accordance with the Existing Land Use Ordinances, in addition to any Commercial Cannabis Activity operating standards found in the Municipal Code, which may be amended at the City’s discretion to minimize or eliminate safety hazards.

10.3 Building Permits and Other Approvals and Permits. Subject to (a) Permittee’s compliance with this Agreement, the Project Approvals the Existing Land Use Ordinances, the Building Ordinances, and Operating Standards; and (b) payment of the usual and customary fees and charges of general application charged for the processing of such applications, permits and certificates and for any utility connection, or similar fees and charges of general application, the City shall process and issue to Permittee promptly upon application therefore all necessary use permits, building permits, occupancy certificates, permits, licenses and other required permits for the construction, use and occupancy of the Project, or any portion thereof, as applied for, including connection to all utility systems under the City’s jurisdiction and control (to the extent that such connections are physically feasible and that such utility systems are capable of adequately servicing the Project).

10.4 Procedures and Standards. The standards for granting or withholding permits or approvals required hereunder in connection with the development of the Project shall be governed as provided herein by the standards, terms and conditions of this Agreement and the Project Approvals, and to the extent not inconsistent therewith, the Existing Land Use Ordinances, but the procedures for processing applications for such permits or approvals (including the usual and customary fees of general application charged for such processing) shall be governed by such ordinances and regulations as may then be applicable.

11. Effect of Agreement.

11.1 Grant of Right. This Agreement shall constitute a part of the Enacting Ordinance, as if incorporated by reference therein in full. The Parties acknowledge that this Agreement grants Permittee the right and entitlement to develop the Project and use the land pursuant to specified and known criteria and rules as set forth in the Project Approvals and Existing Land Use Ordinances, and to grant the City and the residents of the City certain benefits which they otherwise would not receive.

11.2 Binding on City. This Agreement shall be binding upon the City and its successors in accordance with and subject to its terms and conditions, unless subsequent action is taken by the City, whether by ordinance or resolution of the City Council, by referenda, initiative, or otherwise. As long as the City permits the retail cannabis in the City, and the Operating Agreement and Development Agreement are in good standing, the Permittee shall have a right to a Commercial Cannabis Permit.

11.3 Future Conflicting Local Laws. If any City law, including ordinances, resolutions, rules, regulations, standards, policies, conditions and specifications (collectively “City 44 Laws”) are enacted or imposed by a citizen-sponsored initiative or referendum, or by the City Council directly or indirectly in connection with any proposed initiative or referendum, which City Law would conflict with this Agreement, such City Law shall apply to the Project. The Parties, acknowledge that the City’s approval of this Agreement and the City Approvals are legislative actions subject to referendum.

12. Specific Criteria Applicable to Development of the Project.

12.1 Applicable Ordinances. Except as set forth in the Project Approvals and subject to the provisions of Section 10.2 below, the Existing Land Use Ordinances shall govern the development of the Site hereunder and the granting or withholding of all permits or approvals required to develop the Site; provided, however, that (a) Permittee shall be subject to all changes in processing, inspection and plan-check fees and charges imposed by City in connection with the processing of applications for development and construction upon the Site so long as such fees and charges are of general application and are not imposed solely with respect to the Project Site, (b) Permittee shall abide by the Building Ordinances in effect at the time of such applications, (c) Development Impact Fees to be paid by Permittee shall be those in effect at the time permits are issued subject to those fees, and (d) development shall be consistent with current Operating Standards.

12.2 Amendment to Applicable Ordinances. Any change to the Existing Land Use Ordinances that conflicts with the Project Approvals shall nonetheless apply to the Project if, (i) it is determined by City and evidenced through findings adopted by the City Council that the change or provision is reasonably required in order to prevent a condition dangerous to the public health or safety; (ii) it is required by changes in State or Federal law; or (iii) it is otherwise expressly permitted by this Agreement. The City has adopted Operating Standards that govern this type of use, which Regulations, and any amendments thereto, shall apply to the Project.

13. Supersedure of Subsequent Laws or Judicial Action.

13.1 The provisions of this Agreement shall, to the extent feasible, be modified or suspended as may be necessary to comply with any new Law or decision issued by a court of competent jurisdiction (a “Decision”), enacted or made after the Execution Date which prevents or precludes compliance with one or more provisions of this Agreement. Promptly after enactment of any such new Law, or issuance of such Decision, the Parties shall meet and confer in good faith to determine the feasibility of any such modification or suspension based on the effect such modification or suspension would have on the purposes and intent of this Agreement. In addition, Permittee and City shall have the right to challenge the new Law or the Decision preventing compliance with the terms of this Agreement. In the event that such challenge is successful, this Agreement shall remain unmodified and in full force and effect, except that the Term shall be extended, in accordance with Section 3.1 above, for a period of time equal to the length of time the challenge was pursued, to extent such challenge delayed the implementation of the project.

13.2 The Parties recognize that California adopted, through ballot initiative, the AUMA and may adopt through initiative or legislative action other laws and regulations pertaining to either medical or adult use of cannabis. The Parties intend through this Agreement that Permittee shall have the right for retail sales of cannabis as allowed by current State Cannabis Law, 45 pertaining to Commercial Cannabis Activity. To the extent the changes in California law change the legal process or structure by which cannabis retailers can or may operate (i.e. for-profit vs. non-profit entities, size of licensees, etc.), the Parties intend this Agreement to be flexible to allow such changes and may alter the procedures specified herein, by Operating Agreement as defined below, or otherwise, as may be necessary.

14. Operating Agreement. The Parties have entered into an Operating Agreement, incorporated as Exhibit C. The Operating Agreement and this Agreement are not independent of each other but are dependent on each other. Any breach of any terms of one Agreement shall constitute a breach of the other Agreement.

15. CEQA. Pursuant to the California Environmental Quality Act (“CEQA”) (Public Resources Code §21000 et seq.) and the State CEQA Guidelines (Cal. Code Regs.,tit. 14, §15000 et seq.), the whole of the Project, including the Development Agreement, has been reviewed and found to be exempt from CEQA pursuant to State CEQA Guidelines Section 15301, Existing Facilities and a Notice of Exemption will be filed upon adoption of this Resolution.

16. Building Permits. Nothing set forth herein shall impair or interfere with the right of City to require the processing of building permits as required by law relating to any specific improvements proposed for the Project pursuant to the applicable provisions of the City’s municipal code, inclusive of such California and International Codes as have been adopted in accord therewith, that are in effect at the time such permits are applied for; provided, however, no such permit processing shall authorize or permit City to impose any condition on and/or withhold approval of any proposed improvement the result of which would be inconsistent with this Agreement.

17. Review for Compliance.

17.1 Periodic Review. Pursuant to California Government Code section 65865.1, City shall engage in an annual review of this Agreement, on or before the anniversary of the Execution Date, in order to ascertain Permittee’s good faith compliance with its terms (the “Periodic Review”). In the event City fails to formally conduct such annual review, Permittee shall be deemed to be in full compliance with the Agreement.

18. Amendment or Cancellation. This Agreement may be amended or canceled in whole or in part only by mutual consent of the Parties or in the manner provided in California Government Code section 65865.1 or California Government Code section 65868.

19. Provide Notice. Provide the other Party with written notice of such State or Federal law or regulation, a copy of such law or regulation and a statement identifying how such law regulation conflicts with the provisions of this Agreement.

20. Meet and Confer. Upon notice by one Party to another as to preemption or frustration of this Agreement by law or regulation, the Parties shall promptly meet and confer in good faith and make a reasonable attempt to modify or suspend this Agreement to comply with such applicable Federal or State law or regulation. If the Parties cannot agree on a manner or method to comply with such Federal or State law or regulation, the Parties may, but shall not be required to, engage in alternative dispute resolution.
46 21. Notices. All notices or other communications required or permitted hereunder shall be in writing and shall be either personally delivered (which shall include delivery by means of professional overnight courier service which confirms receipt in writing [such as Federal Express or UPS] ), sent by telecopier or facsimile (“Fax”) machine capable of confirming transmission and receipt, or sent by certified or registered mail, return receipt requested, postage prepaid to the following parties at the following addresses or numbers:

If to City: City of Fontana
8353 Sierra Ave.

Fontana, CA 92335
Attention: City Manager
With copy to: Best, Best & Krieger, LLP, City Attorney
2855 E. Guasti Rd.

Suite 400 Ontario, CA 91761
Attention: Ruben Duran, Esq.

If to Permittee: HS Fontana Retail, LLC
2151 E. Convention Center Way, Suite 235
Ontario, CA 91764
Attention Compliance
With copy to: Ezri Vargas, Esq.
2151 E. Convention Center Way, Suite 222
Ontario, CA 91764
Attention : Legal
Notices sent in accordance with this Section shall be deemed delivered upon the: (a) date of delivery as indicated on the written confirmation of delivery (if sent by overnight courier service); (b) date of actual receipt (if personally delivered by other means); (c) date of transmission (if sent by email or telecopier, so long is sender receives actual confirmation that the transmission was received); or (d) date of delivery as indicated on the return receipt (if sent by certified or registered mail, return receipt requested). Notice of change of address shall be given by written notice in the manner detailed in this Section.

22. Breach and Remedies. Notwithstanding any provision of this Agreement to the contrary, Permittee shall not be deemed to be in default under this Agreement with respect to any obligation owed solely to City, and City may not terminate or modify Permittee’ rights under this Agreement, unless City shall have first delivered a written notice of any alleged default to Permittee that specifies the nature of such default. If such default is not cured by Permittee within fourteen (14) calendar days after receipt of such notice of default, City may terminate Permittee’s rights under this Agreement. In the event that a breach of this Agreement occurs, irreparable harm is likely to occur to the non- breaching Party and damages will be an inadequate remedy. To the extent permitted by law, therefore, it is expressly recognized that injunctive relief and specific enforcement of this Agreement are proper and desirable remedies, and it is agreed that any claim by Permittee against City for an alleged breach of this Agreement shall be remedied by injunctive 47 relief or an appropriate action for specific enforcement of this Agreement and not by a claim or action for monetary damages.

23. Entire Agreement. This Agreement and the Exhibits herein contain the entire integrated agreement among the Parties. The Parties intend that this Agreement state their agreement in full to each and every one of its provisions. Any prior agreements, understandings, promises, negotiations or representations respecting the matters dealt with herein or the duties of any Party in relation thereto, not expressly set forth in this Agreement, are agreed by all Parties to be null and void.

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

25. Attorneys’ Fees. In the event any Party hereto brings an action or proceeding for a declaration of the rights of the Parties, for injunctive relief, for an alleged breach or default, or any other action arising out of this Agreement, or the transactions contemplated hereby or institutes a reference or arbitration proceeding as may expressly be permitted by the terms of this Agreement, the prevailing Party in any such action shall be entitled to an award of actual attorneys’ fees and costs incurred in such action or proceeding, without regard to any rule of court or schedule of such fees maintained by the court, in addition to any other damages or relief awarded, regardless of whether such action proceeds to final judgment.

26. Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed an original, but all of which constitute one and the same instrument.

27. Execution of Agreement. The Parties shall sign this Agreement on or within five (5) business days of approval.

28. Estoppel Certificate. City shall, at any time and from time to time within ten (10) calendar days after receipt of written notice from Permittee so requesting, execute, acknowledge and deliver to Permittee a statement in writing: (a) certifying that this Agreement is unmodified and in full force and effect (or, if modified, stating the nature of such modification and certifying that this Agreement, as so modified, is in full force and effect); and (b) acknowledging that there are no uncured defaults on the part of Permittee hereunder or specifying such defaults if any are claimed. Any such statement may be relied upon by any prospective purchaser or encumbrancer of all or any portion of the Site. Upon Permittee’s written request, City shall issue a certificate of performance evidencing completion of any of Permittee’s obligation(s) under this Agreement.

29. Discretion to Encumber. The Parties hereto agree that this Agreement shall not prevent or limit Permittee, in any manner, at Permittee’s sole discretion, from encumbering the Site or any portion thereof or any improvements thereon then owned by such person with any mortgage, deed of trust or other security device (“Mortgage”) securing financing with respect to the Site or such portion. City acknowledges that the lenders providing such financing may require 48 certain modifications, and City agrees, upon request, from time to time, to meet with Permittee and/or representatives of such lenders to negotiate in good faith any such request for modification.

City further agrees that it will not unreasonably withhold its consent to any such requested modification. Any mortgagee or trust deed beneficiary of the Site or any portion thereof or any improvements thereon and its successors and assigns (“Mortgagee”) shall be entitled to the following rights and privileges.

30. Lender Requested Modification/Interpretation. City acknowledges that the lenders providing financing to Permittee may request certain interpretations and modifications of this Agreement. City therefore agrees upon request, from time to time, to meet with the Permittee and representatives of such lenders to negotiate in good faith any such request for interpretation or modification. The City will not unreasonably withhold its consent to any such requested interpretation or modification provided such interpretation or modification is consistent with the intent and purposes of this Agreement, provided, further, that any modifications of this Agreement are subject to the provisions of this Agreement relative to modifications or amendments.

31. Governing Law and Venue. This Agreement and the legal relations between the Parties shall be governed by and construed in accordance with the laws of the State of California.

Furthermore, the Parties agree to venue in San Bernardino County, California.

32. Mutual Covenants. The covenants contained herein, including those contained in the Recitals herein, are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the Party benefited thereby of the covenants to be performed hereunder by such benefited Party.

33. No Third Party Beneficiaries. This Agreement is made and entered into for the sole protection and benefit of the Parties . No other person or entity shall have any right of action based upon any provision of this Agreement.

34. Waiver. Failure by a Party to insist upon the strict performance of any of this Agreement’s provisions by the other party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party’s right to insist and demand strict compliance by the other Party with the terms of this Agreement thereafter.

35. Time of Essence. Time is of the essence in the performance of the provisions of this Agreement as to which time is an element.

36. Recordation of Agreement. This Agreement and any amendment or cancellation thereof shall be recorded with the County Recorder by the City Clerk within the period required by Government Code Section 65868.5.

37. Headings. The headings in this Agreement are inserted for convenience only. They do not constitute part of this Agreement and shall not be used in its construction.

38. Waiver. The waiver by any party to this Agreement of a breach of any provision of this Agreement shall not be deemed a continuing waiver or a waiver of any subsequent breach of that or any other provision of this Agreement.
49 39. Jointly Drafted. It is agreed among the Parties that this Agreement was jointly negotiated and jointly drafted by the Parties and their respective counsel, and that it shall not be interpreted or construed in favor of or against any party solely on the ground that it drafted the Agreement. It is also agreed and represented by all Parties that said Parties were of equal or relatively equal bargaining power and that in no way whatsoever shall this Agreement be deemed to be a contract of adhesion, or unreasonable or unconscionable.

40. Independent Legal Counsel. Each Party acknowledges that it has been represented by independent legal counsel of its own choice throughout all of the negotiations that preceded the execution of this Agreement or has knowingly and voluntarily declined to consult legal counsel, and that each Party has executed this Agreement with the consent and on the advice of such independent legal counsel.

41. Further Cooperation. The Parties herein agree to execute any and all agreements, documents or instruments as may be reasonably necessary in order to fully effectuate the agreements and covenants of the Parties contained in this Agreement, or to evidence this Agreement as a matter of public record, if required to fulfill the purposes of this Agreement. The Parties further agree to mutually cooperate with one another in carrying out the purposes of this Agreement.

42. Enforceability. This Agreement shall not become binding and shall have no force and effect whatsoever until such time as it has been fully executed by and delivered to all of the parties hereto.
[Signatures on following pages]
50 IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the Execution Date.
“CITY”
Date: ______________________, 2024

CITY OF FONTANA, CA
a California Municipal Corporation
By: ______________________________
Acquanetta Warren
Mayor
By: ______________________________
Matt C. Ballantyne
City Manager
Attest
By: ______________________________
Germaine McClellan Key
City Clerk
Approved as to form:

Best, Best & Krieger, LLP
By: ________________________
Ruben Duran, Esq.

City Attorney
51 16498.20173\41901056.1

ACKNOWLEDGEMENT
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,
(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 of Notary
“PERMITTEE”
Date: ________________________, 2023
______________________________
By: ________________________
Its: Managing Member
Approved as to form:

By: _________________________
Eric Lightman
____________________, Esq.

Attorney for Permittee
52 16498.20173\41901056.1

ACKNOWLEDGEMENT
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
(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 of Notary
53 16498.20173\41901056.1
Development Agreement Acknowledgement and Authorization to Record Re: Acknowledgement of Recording of Development Agreement Upon Property I acknowledge I am the owner of the property located at 11275 Sierra Avenue, Suite 3-E, Fontana, California, 92337 (“Property”). It is my understanding that as part of the City of Fontana Commercial Cannabis Permit process, HS Fontana Retail, LLC dba High Season (“Tenant”) must enter into a Development Agreement with the City.

Pursuant to Government Code section 65868.5 a development agreement shall be recorded against real property with the county recorder. By means of this acknowledgement, I am consenting for the foregoing Development Agreement to be recorded against the Property. I also acknowledge that all the conditions and requirements of the Development Agreement are the sole responsibility of the Tenant, and not of the undersigned owner of the Property. “Owner”
Date: ________________________, 2024
By: ________________________
54 16498.20173\41901056.1

ACKNOWLEDGEMENT
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,
(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 of Notary
55 16498.20173\41901056.1

EXHIBIT A
PARCEL NO. 0194-381-46-0000 DESCRIPTION
Parcels 1 through 8 inclusive and 11 of Parcel Map No. 18450, in the City of Fontana, County of San Bernardino, State of California, as per Map recorded in Book 229 Page(s) 15 through 18 of Parcel Maps in the Office of the County Recorder of said County. 0194-381-46
56 16498.20173\41901056.1

EXHIBIT B

MAP OF THE SITE
57 16498.20173
\41901056.1
58 16498.20173\41901056.1

EXHIBIT C

OPERATING AGREEMENT
59 16498.20173\41901056.1

OPERATING AGREEMENT FOR COMMERCIAL CANNABIS BUSINESS LOCATED IN THE CITY OF

FONTANA, CALIFORNIA
THIS OPERATING AGREEMENT (this “Operating Agreement”) for a Commercial Cannabis Business is made and entered into this __th day of _________ ,2024 (“Effective Date”), by and between the CITY OF FONTANA, a California municipal corporation (“City”) and HS Fontana Retail, LLC dba High Season, with its principal address located at 2151 E. Convention Center Way, Suite 235 Ontario California 91764, (“Commercial Cannabis Business”). The City and Commercial Cannabis Business may be referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS
A. The City of Fontana, California (the “City”) is a municipal corporation, duly organized under the constitution and laws of the State of California.

B. The City Council adopted Ordinance No. 1899, on July 12, 2022, as amended on October 25, 2022, establishing a regulatory permit scheme for commercial cannabis activities, such that each proposed commercial activity must have an Agreement and a regulatory permit prior to operation.

C. The Commercial Cannabis Business submitted an application to the City for a use permit to conduct certain commercial cannabis business in the City, located at 11275 Sierra Avenue, Suite 3-E, Fontana California 92337 (“Subject Property”).

D. The City issued a Commercial Cannabis Permit to the Cannabis Business on September 19 2023, a true and correct copy of which is attached hereto as Exhibit A, to permit cannabis retail sales at the Subject Property, consistent with the provisions and requirements of Chapter 33 of the Fontana Municipal Code, permitting cannabis sales in the City.

E. As required by Chapter 33 of the Fontana Municipal Code, the Parties now wish to enter into this Agreement.

NOW, THEREFORE, in consideration of the mutual promises, conditions, and covenants set forth herein, the Parties agree as follows:

AGREEMENT

1. Incorporation of Recitals. The Recitals, and all defined terms set forth in this Agreement, are hereby incorporated into this Agreement as if set forth herein in full.

2. Public Benefit and Social Equity.

2.1 Intent. The purpose of this Agreement is to ensure positive community impacts from commercial cannabis business operations through local sourcing, community benefit and sustainable business practices, and the collection of required fees as applicable for the operation 60 16498.20173\41901056.1
of a commercial cannabis business and to provide mitigation options to be used by City to compensate for impacts to City services, residents, and/or businesses as set forth in Fontana Municipal Code Chapter 33. The Parties agree that this Agreement confers substantial private benefits on Commercial Cannabis Business which should be balanced by commensurate public benefits. As part of the cannabis Regulatory Safety Permit process, Commercial Cannabis Business agrees to enter into this Agreement. Commercial Cannabis Business acknowledges that City and Commercial Cannabis Business have had extensive negotiations and proceedings prior to entering into this Agreement. Commercial Cannabis Business has elected to execute this Agreement as it provides Commercial Cannabis Business with important economic benefits.

Accordingly, the Parties intend to provide consideration to the public to balance the private benefits conferred on Commercial Cannabis Business by providing mitigation measures to the public and to pay for City services.

2.2 Local Hiring and Sourcing. Commercial Cannabis Business agrees to use its reasonable efforts to hire qualified City of Fontana residents, currently living in Fontana, to work at its commercial cannabis businesses. Commercial Cannabis Business shall also use reasonable efforts to retain the services of qualified contractors and suppliers who are located in the City of Fontana or who employ a significant number of City of Fontana residents. Commercial Cannabis Business shall make a good faith effort to advertise on various social media sites, at local job fairs, and through public agencies and organizations.

3. Definitions. The following terms shall have the following meanings for purposes of this Agreement, but other terms may be defined elsewhere in this Agreement.

3.1 “Commercial Cannabis Permit” means the regulatory permit issued by the City to the Commercial Cannabis Business pursuant to the provisions of Chapter 33 of the Fontana Municipal Code.

3.2 “City Permits” means and includes all building permits, use permits, zoning amendments, operating agreements, development agreements, and other permits, including the cannabis business permit, licenses, entitlements, and agreements that the City, acting in its governmental capacity, must issue or approve for the Cannabis Business to operate in accordance with the City’s regulations and this Agreement.

3.3 “Commencement Date” means the date that all of the following have occurred:
(1) the City has issued all necessary City Permits; (2) the Cannabis Business has obtained all necessary State Licenses to operate; and (3) the Cannabis Business has obtained a certificate of occupancy.

3.4 “City Manager” means the City Manager and his or her designee.

3.5 “Effective Date” means the date first entered above as the Effective Date and is the date that both Parties have signed this Agreement.
61 16498.20173\41901056.1

3.6 “Manager” means a person with responsibility and authority over the establishment, management, supervision, or oversight of the operation of the Commercial Cannabis Business.

3.7 “State License(s)” means all licenses required to be issued by the State of California for operation of the Commercial Cannabis Business pursuant to Division 10 of the Business and Professions Code and applicable state regulations, including but not limited to Division 42 of Title 16, Division 8 of Title 3, and Division 1 of Title 17 of the California Code of Regulations (“CCR”), as those provisions may be amended.

3.8 “Term” means the period of time this Agreement is in effect as specified in Section

5. 4. Consideration. As consideration for the rights and benefits it enjoys under this Agreement, including its operation of approved cannabis uses in the City during the Term, the Commercial Cannabis Business shall pay the City fees as set forth by Resolution by the City Council.

5. Term of Agreement. Except as otherwise specified herein, the term of this Agreement (the “Term”) shall be for three (3) years from the Execution Date. The Term shall generally be subject to earlier termination or extension as hereinafter provided.

5.1 Term Extension. This Agreement shall be subject to two (2) year extensions at the sole discretion of the City. If at the sole discretion of the City, the City finds that Permittee demonstrates to have complied in good faith with the terms and conditions of this Agreement, the Parties may enter into a written extension signed by both Parties.

5.2 Request by Permittee of Term Extension. The Term of this Agreement may be extended at the request by Permittee by written notice no later than one hundred twenty (120) calendar days before the expiration of the term and Permittee shall not be in default with respect to any provision of this Agreement or any subsequent agreement or understanding between the Parties arising from or related to this Agreement, having received notice from City of said default per this Agreement, or if Permittee did in fact default as to this Agreement, upon notice from City, that Permittee did cure said default during the period to cure provided herein to City’s satisfaction.

5.3 Termination of Agreement. Upon the termination of this Agreement, either by expiration or otherwise, Permittee shall have no right to engage in Commercial Cannabis Activity at the Project Site, except as may otherwise be allowed by City ordinance or law.

6. Business License Required. A valid City of Fontana Business License is required for all persons engaged in transacting and carrying on any commercial cannabis business activity in the City of Fontana. It is unlawful for any person or legal entity to commence, transact or carry-on cannabis business activity in the City of Fontana without first having procured a City of Fontana cannabis business license.
62 16498.20173\41901056.1

7. Bond Requirement. Commercial Cannabis Business shall provide proof of a bond in the amount of Twenty-Five Thousand Dollars ($25,000.00) to cover the cost of enforcing the terms of Chapter 33 and this Agreement if necessitated by a violation of the licensing requirements.

8. Records and Recordkeeping.

8.1 Commercial Cannabis Business shall maintain accurate books and records in an electronic format, detailing all of the revenues and expenses of the business, and all of its assets and liabilities. On no less than an annual basis, or at any time upon reasonable request of the City, Commercial Cannabis Business shall file a sworn statement detailing the Commercial Cannabis Business’s revenue and number of sales during the previous 12-month period (or shorter period based upon the timing of the request), provided on a per-month basis. The statement shall also include gross revenues for each month, and all applicable taxes paid or due to be paid. On an annual basis, Commercial Cannabis Business shall submit to the City a financial audit of the Commercial Cannabis Business operations conducted by an independent certified public accountant. Each permittee shall be subject to a regulatory compliance review and financial audit as determined by the City.

8.2 Commercial Cannabis Business shall maintain a current register of the names and the contact information (including the name, address, and telephone number) of anyone owning or holding an interest in the Commercial Cannabis Business, and separately of all the officers, managers, employees, agents and volunteers currently employed or otherwise engaged by the Commercial Cannabis Business. The register required by this paragraph shall be provided to the City upon request.

8.3 All records collected by Commercial Cannabis Business shall be maintained for a minimum of seven years and shall be made available by the Commercial Cannabis Business to the agents or employees of the City upon request, except that private medical records shall be made available only pursuant to a properly executed search warrant, subpoena, or court order.

8.4 Subject to any restrictions under the Health Insurance Portability and Accountability Act (HIPAA) regulations, Commercial Cannabis Business shall allow City officials to have access to the business’s books, records, accounts, together with any other data or documents relevant to its permitted commercial cannabis activities, for the purpose of conducting an audit or examination. Books, records, accounts, and any and all relevant data or documents will be produced no later than 24 hours after receipt of the City’s request, unless otherwise stipulated by the City. The City may require the materials to be submitted in an electronic format that is compatible with the city’s software and hardware.

9. Records Inspection, Examination and Audit. Commercial Cannabis Business acknowledges and agrees that City is empowered under this Agreement to inspect, examine and audit Commercial Cannabis Business’s books and records (including tax filings and returns). City or its authorized agents shall have the power and authority to conduct a full inspection, examination and audit of such books and records (including tax filings and returns) at any reasonable time, including but not limited to, during normal business hours. In the event any such books, records, 63 16498.20173\41901056.1
tax filings and returns cannot be made fully available within the City of Fontana, Commercial Cannabis Business acknowledges and agrees that it shall reimburse City for the cost of all transportation, lodging, meals, portal-to-portal travel time, and other incidental costs reasonably incurred by City or its authorized agents in obtaining said full inspection, examination and audit.

In the event that said records inspection, examination and audit determines that a net operating agreement or development agreement fee payment deficiency of greater than five percent (5%) exists; Commercial Cannabis Business acknowledges and agrees that it shall reimburse City for the full cost of said records inspection, examination and audit reasonably incurred by City or its authorized agents.

10. General Terms and Conditions. The Commercial Cannabis Business shall comply with all of the following terms and conditions for the Term of this Agreement:

10.1 This Agreement is only valid for the Commercial Cannabis Business to operate at the Subject Property identified in this Agreement. The rights and obligations set forth in this Agreement shall not be transferred, assigned, or assumed unless agreed to in advance in writing by the City. The Commercial Cannabis Business expressly acknowledges, understands and agrees that nothing in this Agreement confers any ongoing vested property right or entitlement to conduct the Commercial Cannabis Business, or any other commercial cannabis activity, at the Subject Property; this Agreement sets forth only the operational requirements of the Commercial Cannabis Business as otherwise approved by the City and the Commercial Cannabis Business will be required to obtain a permit in accordance with Chapter 33 of the Fontana Municipal Code which the City shall issue in accordance with this Agreement.

10.2 Conditions placed on any City Permits, expressly including the Commercial Cannabis Business Permit shall be conditions and requirements of this Agreement. Violations of the City Permits shall be deemed violations of this Agreement and shall constitute a material breach of this Agreement. Violations of any applicable State Licenses shall be deemed violations of this Agreement and shall constitute a material breach of this Agreement.

10.3 The Commercial Cannabis Business shall obtain and maintain at all times a valid Commercial Cannabis Permit, Use Permit, and applicable State License(s) prior to and during operation of the Cannabis Business. The City shall issue a Commercial Cannabis Permit and any other City Permits to the Commercial Cannabis Business provided that the Cannabis Business is in compliance with the provision of Chapter 33 of the Fontana Municipal Code and State Law.

10.3.1 As soon as practicable, the Commercial Cannabis Business shall inform the City when it obtains its necessary State License(s), and shall provide a copy of the State License(s) to the City Manager. The City shall cooperate with the Commercial Cannabis Business as appropriate and as needed to facilitate the State’s issuance of a State License(s) to the Commercial Cannabis Business. Failure of the Commercial Cannabis Business to procure and produce evidence of receipt of any required state licenses within eighteen months of the effective date of this Agreement shall be deemed a material and incurable breach of the Agreement and, this Agreement, along with any permits issued by the City for a Commercial Cannabis Business shall immediately be deemed null and void and the Commercial Cannabis 64 16498.20173\41901056.1
Business shall be prohibited from application for a future Commercial Cannabis Business permit in the City for a period of ten years.

10.3.2 The Commercial Cannabis Business agrees to provide City with copies of any reports provided to a State Cannabis Licensing Agency, including any required financial or compliance reports, within thirty (30) days of that submission and further agrees to keep such records in accordance with State law and Chapter 33 of the Fontana Municipal Code.

10.3.3 The City shall diligently process the Commercial Cannabis Business’s applications for all City Permits. This Agreement commits the City in advance to approve the City Permits provided that the Commercial Cannabis Business complies with all the provisions of Chapter 33 of the Fontana Municipal Code and the requirements to obtain City Permits. Nothing in this Agreement relieves the Commercial Cannabis Business of the obligation to comply with all requirements of the Fontana Municipal Code.

10.4 The Commercial Cannabis Business agrees to comply with all applicable State Law and local laws and regulations applicable to operation of the Commercial Cannabis Business, including Chapter 33 of the Fontana Municipal Code.

10.5 The Commercial Cannabis Business agrees to conduct an annual financial audit and/or compliance review, at Commercial Cannabis Business’s cost, as requested by the City.

11. Operational Requirements. In addition to all operating requirements set forth in Chapter 33 of the Fontana Municipal Code, the Commercial Cannabis Business shall comply with the following specific operational requirements:

11.1 The Commercial Cannabis Business shall immediately notify the Fontana Police Department of any criminal activity, or suspected criminal activity, occurring at the Subject Property. In the event of any internal security system breach, including a faulty alarm system, broken or damaged surveillance cameras or other video recording equipment, or broken or damaged locks, doors, or lighting which may increase risk of criminal activity at the Subject Property, the Manager of the Commercial Cannabis Business shall notify the City Police Department as soon as practicable after becoming aware of the security system breach. The Commercial Cannabis Business shall diligently attempt to fix or resolve any such security breach immediately; if circumstances require additional time and delay to remedy, the Commercial Cannabis Business shall so notify the City Police Department and provide an estimated timeline the security breach will be cured.

11.2 If the Commercial Cannabis Business receives any criminal threats, or otherwise suspects any criminal targeting related to movement of product or cash from or to the Subject Property, the Commercial Cannabis Business shall immediately notify the City Police Department.

11.3 Commercial Cannabis Business shall abide by the operating procedures submitted to the City, as set forth in Section 33-8(a)(8) and that are hereby attached and incorporated into 65 16498.20173\41901056.1
this Agreement as Exhibit B. The Commercial Cannabis Business shall immediately notify City of any modifications to the operating procedures.

11.4 Commercial Cannabis Business shall abide by the operating requirements set forth in Sections 33-29, 33-30 and 33-31, including but not limited to, hours of operation not to exceed 9:00 am to 9:00 pm, no consumption of cannabis on premises, no cannabis or cannabis products shall be visible from exterior of property, and no persons under 21 years shall be allowed on the premises. The provisions of Sections 33-29, 33-30 and 33-31 shall be strictly enforced by Commercial Cannabis Business.

11.5 Commercial Cannabis Business shall abide by the requirements of Development Agreement.

12. Inspections.

12.1 The city manager, police chief, fire marshal, code compliance representative and their designees charged with enforcing the provisions of the Fontana Municipal Code may enter the Commercial Cannabis Business at any time during regular business hours, without notice, and inspect the location of the Commercial Cannabis Business as well as any recordings and records required to be maintained pursuant to this chapter or under applicable provisions of state law.

12.2 It is unlawful for any person having responsibility over the operation of the Commercial Cannabis Business, to impede, obstruct, interfere with, or otherwise not to allow, the City to conduct an inspection, review or copy records, recordings or other documents required to be maintained by the Commercial Cannabis Business under Chapter 33 or under state or local law. It is also unlawful for a person to conceal, destroy, deface, damage, or falsify any records, recordings or other documents required to be maintained by the Commercial Cannabis Business under Chapter 33 or under state or local law.

13. Default and Termination for Cause. Without prejudice to its other remedies at law or in equity, the City may terminate this Agreement for cause with thirty (30) days’ written notice to Commercial Cannabis Business provided that Commercial Cannabis Business does not cure as set forth in section 13.7 below. Caused as used in this section is defined as:

13.1 Failure to comply with the terms of the City of Fontana Commercial Cannabis Permit issued to Commercial Cannabis Business by City;

13.2 Failure of Commercial Cannabis Business to maintain a valid active City of Fontana Business License as the commercial cannabis business approved by the Commercial Cannabis Permit and as operating;

13.3 Failure by Commercial Cannabis Business to accurately report gross receipts information or other data necessary for City to calculate/confirm operating or development agreement fees;
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13.4 Failure by Commercial Cannabis Business to pay operating agreement fees and related reimbursement costs within thirty (30) days of the date those fees are due;

13.5 Failure by Commercial Cannabis Business to cooperate with City or City’s authorized agents in any inspection, examination and audit of Commercial Cannabis Business’s commercial cannabis business books and records (including tax filings and returns).

13.6 This Agreement will automatically terminate if:

13.6.1 Commercial Cannabis Business’s Commercial Cannabis Permit is revoked by City or is not renewed by City, or

13.6.2 Commercial Cannabis Business transfers its Commercial Cannabis Permit in violation of Fontana Municipal Code section 33-15.

13.7 Cure Period. Commercial Cannabis Business shall cure the default resulting from the cause for termination within thirty (30) days of the date of the notice of termination. If Commercial Cannabis Business fails to cure the default within thirty (30) days of the date of the notice of termination for cause, this Agreement will be terminated.

14. Termination.

14.1 The Commercial Cannabis Business may terminate this Agreement prior to expiration of the Term for the reasons and subject to the requirements set forth below. The Commercial Cannabis Business understands and acknowledges that the right to operate the Commercial Cannabis Business is expressly contingent on full compliance with Chapter 33 of the Fontana Municipal Code. As such, termination of this Agreement shall result in the immediate termination of the Commercial Cannabis Business’s operations, unless and until a new Operating Agreement is executed by the Parties.

14.2 Commercial Cannabis Business’s Termination Rights. The Commercial Cannabis Business may, at any time and in its sole discretion, effective thirty (30) days after the Commercial Cannabis Business provides written notice of termination to the City. Such termination shall not relieve Commercial Cannabis Business of any outstanding or previously incurred liability, payment, or obligation to City. All fees due pursuant to the Commercial Cannabis Permit, this Operating Agreement or any Development Agreement between the Parties shall immediately be due and payable.

15. Indemnification.

15.1 Commercial Cannabis Business shall defend (with Counsel reasonably approved by the City), indemnify, and hold harmless the City and its Council, boards and commissions, officers, officials, employees, and agents from and against any and all actual and alleged liabilities, demands, claims, losses, damages, injuries, actions or proceedings and costs and expenses incidental thereto (including costs of defense, settlement and attorney’s fees), which arise out of, or which are in any way related to i) the cannabis business permit and any land use 67 16498.20173\41901056.1
entitlement related thereto, ii) the proceedings undertaken in connection with the approval, denial, or appeal of the cannabis business permit and any land use entitlement related thereto, iii) any subsequent approvals or licensing/permits relating to the cannabis business permit and any land use entitlement related thereto, iv) the processing of the cannabis business permit and any land use entitlement related thereto, v) any amendments to the approvals for the cannabis business permit and any land use entitlement related thereto, vi) the City’s approval, consideration, analysis, review, issuance, denial or appeal of the cannabis business permit; vii) the City’s approval, consideration, analysis, review, issuance, denial or appeal of any land use entitlement related thereto, viii) the City’s drafting, adoption and passage of an ordinance, and related resolutions, policies, rules and regulations, allowing for cannabis businesses, ix) the City’s drafting, adoption and passage of an ordinance, and related resolutions if necessary in the future regarding any zoning law amendment(s) related to Commercial Cannabis Business, x) the operation of Commercial Cannabis Business or activity, xi) the process used by the City in making its decision to approve, consider, analyze, review, issue, or deny, my cannabis business permit or any related land use entitlement, or the appeal of either, xii) City’s compliance or failure to comply with applicable laws and regulations or xiii) the alleged violation of any federal, state or local laws by Commercial Cannabis Business or any of its officers, employees or agents, except where such liability is caused by the sole negligence or willful misconduct of the City.

15.2 City may (but is not obligated to) defend such challenge as City, in its sole discretion, determines appropriate, all at applicant’s sole cost and expense. Commercial Cannabis Business shall bear any and all losses, damages, injuries, liabilities, costs, and expenses (including, without limitation, staff time and in-house attorney’s fees on a fully-loaded basis, attorney’s fees for outside legal counsel, expert witness fees, court costs, and other litigation expenses) arising out of or related to any challenge (“Costs”), whether incurred by Commercial Cannabis Business, City, or awarded to any third party, and shall pay to the City upon demand any Costs incurred by the City.

15.3 Commercial Cannabis Business shall fund a deposit account (“Fund”) to reimburse the City’s cost, including attorney’s fees, to defend any claim, action, or proceeding that is or may be subject to the agreement on limitations of City’s Liability, and Certifications, Assurances Warranties, and Indemnification to City. In the event that any such claim, action, or proceeding is filed against the City, Commercial Cannabis Business shall within thirty (30) days of the filing deposit an initial sum of $25,000 to the Fund to reimburse Commercial Cannabis Business’ portion of the City defense costs, as determined by the City in its sole discretion. The Fund, once established, shall at all times, until conclusion of the claim, proceedings, or action, contain an amount necessary to cover not less than three months’ worth of budgeted expenditures by the City relating to the City’s defense of the claim, action, or proceeding, including all time to appeal, or as long as expenditures made by the City relating to its defense remain unreimbursed, whichever is later. The City may, from time to time, in the City’s sole and absolute discretion, request additional deposits from the Commercial Cannabis Business to ensure the fund balance is adequate to defend any claim, action or proceeding, including appeals related thereto. Once all remaining and outstanding reimbursements have been paid to the City by Commercial 68 16498.20173\41901056.1
Cannabis Business, and upon resolution of the claim, proceeding or action, City shall return any remaining unused portion of deposit.

15.4 The provisions of this subsection shall survive any termination or expiration of this Agreement for any reason.

16. Waiver, Release and Hold Harmless

16.1 Commercial Cannabis Business hereby waives, releases, and holds harmless the City of Fontana (“City”) and its Council, boards and commissions, officers, officials, employees, and agents from any and all actual and alleged claims, losses, damages, injuries, liabilities, costs (including attorney’s fees), suits or other expenses which arise out of, or which are in any way relate to my application for a cannabis business permit, the issuance of the cannabis business permit, the process used by the City in making its decision, the enforcement of the conditions of the cannabis business permit, or the cannabis business’ operations.

16.2 Commercial Cannabis Business hereby waives, releases and holds harmless the City and its Council, boards and commissions, officers, officials, employees, and agents from any and all actual and alleged claims, losses, damages, injuries, liabilities, costs (including attorney’s fees), suits or other expenses which arise out of, or which are in any way relate to:
(1) any repeal or amendment of any provision of the Fontana Municipal Code or Zoning Ordinance relating to commercial cannabis activity; or (2) any investigation, arrest or prosecution of Commercial Cannabis Business, or the cannabis business’ owners, operators, employees, clients or customers, for a violation of state or federal laws, rules or regulations relating to cannabis activities.

16.3 The provisions of this subsection shall survive any termination or expiration of this Agreement for any reason.

17. Notice. Any notice or other communication provided pursuant to this Agreement must be in writing and shall be considered properly given and effective only when mailed or delivered in the manner provided by this Section to the persons identified below. A mailed notice or other communication shall be considered given and effective on the third day after it is deposited in the United States Mail (certified mail and return receipt requested). A notice or other communication sent in any other manner will be effective or will be considered properly given when actually delivered. A Party may change its address for these purposes by giving written notice of the change to the other Party in the manner provided in this Section.

If to City: City of Fontana
8353 Sierra Ave.

Fontana, CA 92335
Attention: City Manager
69 16498.20173\41901056.1
With copy to: Best, Best & Krieger, LLP, City Attorney
2855 E. Guasti Rd.

Suite 400 Ontario, CA 91761
Attention: Ruben Duran, Esq.

If to Permittee: HS Fontana Retail, LLC
2151 E. Convention Center Way, Suite 235
Ontario, CA 91764
Attention Compliance
With copy to: Ezri Vargas, Esq.
2151 E. Convention Center Way, Suite 222
Ontario, CA 91764
Attention : Legal

17.1 “Force Majeure Event” means a cause of delay that is not the fault of the Party who is required to perform under this Agreement and is beyond that Party’s reasonable control, including the elements (such as floods, earthquakes, windstorms, and unusually severe weather), fire, energy shortages or rationing, riots, acts of terrorism, war or war-defense conditions, acts of any public enemy, epidemics, pandemics, the actions or inactions of any governmental entity (excluding the City) or that entity’s agents, including any “stay at home” or “safer at home” and/or any other governmental order requiring the Commercial Cannabis Business to temporarily cease operations, litigation, labor shortages (including shortages caused by strikes or walkouts), and materials shortages.

17.2 Except as otherwise expressly provided in this Agreement, if the performance of any act required by this Agreement to be performed by either the City or Commercial Cannabis Business is prevented or delayed because of a Force Majeure Event, then the time for performance shall be extended for a period equivalent to the period of delay, and performance of the act during the period of delay will be excused.

18. Waiver. A Party’s failure to insist on strict performance of this Agreement or to exercise any right or remedy upon the other Party’s breach of this Agreement shall not constitute a waiver of any performance, right, or remedy. A Party’s waiver of the other Party’s breach of any provision in this Agreement shall not constitute a continuing waiver or a waiver of any subsequent breach of the same or any other provision. A waiver is binding only if set forth in writing and signed by the waiving Party.
70 16498.20173\41901056.1

19. Relationship of Parties. This Agreement does not create any employment relationship, ownership interest, or other association between the City and Commercial Cannabis Business.

Nothing herein shall be construed to create the relationship of principal and agent, partnership or other joint venture between the City and Commercial Cannabis Business.

20. Attorneys’ Fees. The Party prevailing in any litigation concerning this Agreement, the Subject Property, or the Commercial Cannabis Business operations, shall be entitled to an award by the court of reasonable attorneys’ fees and litigation costs. If the City is the prevailing party, then this Section shall apply whether the City is represented in the litigation by the designated City Attorney or by outside counsel.

21. Jurisdiction and Venue. This Agreement has been executed and delivered in the State of California and the validity, interpretation, performance, and enforcement of any of the clauses of this Agreement shall be determined and governed by the laws of the State of California. Both parties further agree that San Bernardino County, California, shall be the venue for any action or proceeding that may be brought or arise out of, in connection with or by reason of this Agreement.

22. Severability. If a court with competent jurisdiction finds any provision of this Agreement to be invalid, void, or unenforceable, then the remaining provisions shall remain in full force and effect, and to this end this Agreement shall be severable.

23. Counterparts. The Parties may execute this Agreement in counterparts, each of which shall constitute an original, but all of which shall collectively constitute this same Agreement.

24. Disclaimer. Despite California’s commercial cannabis laws and the terms and conditions of this Agreement or any Commercial Cannabis Permit issued pertaining to Commercial Cannabis Business or the hereinabove specified property location, California commercial cannabis cultivators, transporters, distributors, cannabis testing facility/laboratory businesses or possessors may still be subject to arrest by federal officers and prosecuted under federal law.

The Federal Controlled Substances Act, 21 USC § 801 et seq., prohibits the manufacture, manufacturing, and possession of cannabis without any exemptions for medical or non-medicinal use.

25. Integration and Modification. This Agreement sets forth the Parties’ entire understanding and agreement regarding the matters addressed herein. This Agreement supersedes all prior or contemporaneous agreements, representations, and negotiations (written, oral, express, or implied) and may be modified only by written agreement signed by both Parties.

IN WITNESS WHEREOF, the parties enter into this Agreement as of the Effective Date.

City of Fontana HS Fontana Retail, LLC
71 16498.20173\41901056.1
By: By:

City Manager James Previti
Dated: , 2024 Dated: , 2024
Approved as to Form Fontana
City Attorney
By:

City Attorney
72 City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2955 Agenda Date: 5/14/2024
Agenda #: C. Category: Consent Calendar
FROM:

Development Services
SUBJECT:

Purchase and Sale Agreement - Downtown Fontana Property RECOMMENDATION:

1. Approve a Purchase and Sale Agreement for the purchase of property located at 16710 and 16726 Spring Street, more specifically described as APNs #0191-161-13 and 0191-161-18.

2. Authorize the City Manager to execute any documents necessary or appropriate to effectuate said approvals and/or agreement.

COUNCIL GOALS:
· Promote economic development by concentrating on job creation. · Provide a diverse range of housing types and levels of affordability while addressing homelessness in the community by construction of affordable high-quality multi-family housing.
· Provide a diverse range of housing types and levels of affordability while addressing homelessness in the community by acquisition, substantial rehabilitation, and professional management of selected multi-family properties to provide more affordable units and reduce crime and code enforcement activity.

DISCUSSION:

The City of Fontana will be undertaking an expansive and comprehensive revitalization of Downtown Fontana. The specific geographic area to be targeted includes Upland Ave to the North, Orange Avenue to the South, Mango Ave to the East and Juniper Ave to the West. A primary component of this revitalization effort will require the acquisition, demolition, replanning, and redevelopment of several key properties within the area. To facilitate the implementation of this revitalization, the City will be acquiring various properties in Downtown Fontana. Notwithstanding the fact that any structures that exist on parcels being acquired may be demolished and therefore have no future value, parcels are being acquired at market rate based on values attributable to their current use.

The subject properties are located on the north side of Spring Street, at Juniper Avenue. The parcels combined total approximately 21,000 square feet and include two buildings totaling approximately 6,000 square feet.

The city and the seller’s brokers have reached agreement on a Purchase Agreement with the City of Fontana Page 1 of 2 Printed on 5/8/2024 powered by Legistar™ 73
File #: 21-2955 Agenda Date: 5/14/2024
Agenda #: C. Category: Consent Calendar
The city and the seller’s brokers have reached agreement on a Purchase Agreement with the following proposed deal-points:
· The City of Fontana would acquire the property for the price of $1,500,000 with an estimated total cost of purchase (including escrow, title, brokerage fees, and demolition) of $1,650,000.00. This price is consistent with prior acquisitions; the properties would be purchased as-is and closing would occur on or before June 1, 2024.
· The City has completed its due diligence on the subject property, including title review. · The city will have a fifteen-day financing period to complete all wire-transfers and documents necessary for the close of escrow.

Approval of the Purchase Agreement and acquisition of the subject property will assist with the assemblage of various properties located in Downtown Fontana; specifically, this property is envisioned as part of a high-density multifamily development. The overall assemblage and development will facilitate the City’s vision and plans to dramatically revitalize the Downtown Community.

FISCAL IMPACT:

The fiscal impact associated with approval of this item is $1,650,00.00, including escrow costs and appropriate fees. Funding is included in the current 2023-24 budget in fund 602 - Capital Improvement.

MOTION:

Approve staff recommendation.

ATTACHMENTS:

Purchase and Sale Agreement
City of Fontana Page 2 of 2 Printed on 5/8/2024
powered by Legistar™ 74

DISCLOSURE REGARDING

REAL ESTATE AGENCY RELATIONSHIP
(As required by the Civil Code)
(C.A.R. Form AD, Revised 12/21)
(If checked) This form is being provided in connection with a transaction for a leasehold interest exceeding one year as per Civil Code section 2079.13(j), (k), and (l).

When you enter into a discussion with a real estate agent regarding a real estate transaction, you should from the outset understand what type of agency relationship or representation you wish to have with the agent in the transaction.

SELLER'S AGENT
A Seller's agent under a listing agreement with the Seller acts as the agent for the Seller only. A Seller's agent or a subagent of that agent has the following affirmative obligations:

To the Seller: A Fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with the Seller.

To the Buyer and the Seller:
(a) Diligent exercise of reasonable skill and care in performance of the agent's duties. (b) A duty of honest and fair dealing and good faith.
(c) A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the parties. An agent is not obligated to reveal to either party any confidential information obtained from the other party that does not involve the affirmative duties set forth above.

BUYER'S AGENT
A Buyer's agent can, with a Buyer's consent, agree to act as agent for the Buyer only. In these situations, the agent is not the Seller's agent, even if by agreement the agent may receive compensation for services rendered, either in full or in part from the Seller. An agent acting only for a Buyer has the following affirmative obligations:

To the Buyer: A fiduciary duty of utmost care, integrity, honesty and loyalty in dealings with the Buyer.

To the Buyer and the Seller:
(a) Diligent exercise of reasonable skill and care in performance of the agent's duties. (b) A duty of honest and fair dealing and good faith.
(c) A duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the parties. An agent is not obligated to reveal to either party any confidential information obtained from the other party that does not involve the affirmative duties set forth above.

AGENT REPRESENTING BOTH SELLER AND BUYER
A real estate agent, either acting directly or through one or more salespersons and broker associates, can legally be the agent of both the Seller and the Buyer in a transaction, but only with the knowledge and consent of both the Seller and the Buyer.

In a dual agency situation, the agent has the following affirmative obligations to both the Seller and the Buyer:
(a) A fiduciary duty of utmost care, integrity, honesty and loyalty in the dealings with either the Seller or the Buyer. (b) Other duties to the Seller and the Buyer as stated above in their respective sections.

In representing both Seller and Buyer, a dual agent may not, without the express permission of the respective party, disclose to the other party confidential information, including, but not limited to, facts relating to either the Buyer's or Seller's financial position, motivations, bargaining position, or other personal information that may impact price, including the Seller's willingness to accept a price less than the listing price or the Buyer's willingness to pay a price greater than the price offered.

SELLER AND BUYER RESPONSIBILITIES
Either the purchase agreement or a separate document will contain a confirmation of which agent is representing you and whether that agent is representing you exclusively in the transaction or acting as a dual agent. Please pay attention to that confirmation to make sure it accurately reflects your understanding of your agent's role.

The above duties of the agent in a real estate transaction do not relieve a Seller or Buyer from the responsibility to protect his or her own interests. You should carefully read all agreements to assure that they adequately express your understanding of the transaction. A real estate agent is a person qualified to advise about real estate. If legal or tax advice is desired, consult a competent professional.

If you are a Buyer, you have the duty to exercise reasonable care to protect yourself, including as to those facts about the property which are known to you or within your diligent attention and observation.

Both Sellers and Buyers should strongly consider obtaining tax advice from a competent professional because the federal and state tax consequences of a transaction can be complex and subject to change.

Throughout your real property transaction you may receive more than one disclosure form, depending upon the number of agents assisting in the transaction. The law requires each agent with whom you have more than a casual relationship to present you with this disclosure form. You should read its contents each time it is presented to you, considering the relationship between you and the real estate agent in your specific transaction. This disclosure form includes the provisions of Sections 2079.13 to 2079.24, inclusive, of the Civil Code set forth on page 2. Read it carefully. I/WE ACKNOWLEDGE RECEIPT OF A COPY OF THIS DISCLOSURE AND THE PORTIONS OF THE CIVIL CODE PRINTED ON THE SECOND PAGE.

Buyer Seller Landlord Tenant Date
Buyer Seller Landlord Tenant Date
Agent DRE Lic. #
Real Estate Broker (Firm)
By DRE Lic. # Date
(Salesperson or Broker-Associate, if any)
© 2021, California Association of REALTORS®, Inc.

AD REVISED 12/21 (PAGE 1 OF 2)
DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP (AD PAGE 1 OF 2) Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com X City of Fontana
Sierra Realty Fontana Inc 02038519
Ken Galasso 00570875
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
75 CIVIL CODE SECTIONS 2079.13 ‒ 2079.24 (2079.16 APPEARS ON THE FRONT) 2079.13. As used in Sections 2079.7 and 2079.14 to 2079.24, inclusive, the following terms have the following meanings:
(a) “Agent” means a person acting under provisions of Title 9 (commencing with Section 2295) in a real property transaction, and includes a person who is licensed as a real estate broker under Chapter 3 (commencing with Section 10130) of Part 1 of Division 4 of the Business and Professions Code, and under whose license a listing is executed or an offer to purchase is obtained. The agent in the real property transaction bears responsibility for that agent's salespersons or broker associates who perform as agents of the agent. When a salesperson or broker associate owes a duty to any principal, or to any buyer or seller who is not a principal, in a real property transaction, that duty is equivalent to the duty owed to that party by the broker for whom the salesperson or broker associate functions. (b) “Buyer” means a transferee in a real property transaction, and includes a person who executes an offer to purchase real property from a seller through an agent, or who seeks the services of an agent in more than a casual, transitory, or preliminary manner, with the object of entering into a real property transaction. “Buyer” includes vendee or lessee of real property. (c) “Commercial real property” means all real property in the state, except (1) single-family residential real property, (2) dwelling units made subject to Chapter 2 (commencing with Section 1940) of Title 5, (3) a mobilehome, as defined in Section 798.3, (4) vacant land, or (5) a recreational vehicle, as defined in Section 799.29. (d) “Dual agent” means an agent acting, either directly or through a salesperson or broker associate, as agent for both the seller and the buyer in a real property transaction. (e) “Listing agreement” means a written contract between a seller of real property and an agent, by which the agent has been authorized to sell the real property or to find or obtain a buyer, including rendering other services for which a real estate license is required to the seller pursuant to the terms of the agreement. (f) “Seller's agent” means a person who has obtained a listing of real property to act as an agent for compensation. (g) “Listing price” is the amount expressed in dollars specified in the listing for which the seller is willing to sell the real property through the seller's agent. (h) “Offering price” is the amount expressed in dollars specified in an offer to purchase for which the buyer is willing to buy the real property. (i) “Offer to purchase” means a written contract executed by a buyer acting through a buyer's agent that becomes the contract for the sale of the real property upon acceptance by the seller. (j) “Real property” means any estate specified by subdivision (1) or (2) of Section 761 in property, and includes (1) single-family residential property, (2) multiunit residential property with more than four dwelling units, (3) commercial real property, (4) vacant land, (5) a ground lease coupled with improvements, or (6) a manufactured home as defined in Section 18007 of the Health and Safety Code, or a mobilehome as defined in Section 18008 of the Health and Safety Code, when offered for sale or sold through an agent pursuant to the authority contained in Section 10131.6 of the Business and Professions Code. (k) “Real property transaction” means a transaction for the sale of real property in which an agent is retained by a buyer, seller, or both a buyer and seller to act in that transaction, and includes a listing or an offer to purchase. (l) “Sell,” “sale,” or “sold” refers to a transaction for the transfer of real property from the seller to the buyer and includes exchanges of real property between the seller and buyer, transactions for the creation of a real property sales contract within the meaning of Section 2985, and transactions for the creation of a leasehold exceeding one year's duration. (m) “Seller” means the transferor in a real property transaction and includes an owner who lists real property with an agent, whether or not a transfer results, or who receives an offer to purchase real property of which he or she is the owner from an agent on behalf of another. “Seller” includes both a vendor and a lessor of real property. (n) “Buyer's agent” means an agent who represents a buyer in a real property transaction. 2079.14. A seller's agent and buyer's agent shall provide the seller and buyer in a real property transaction with a copy of the disclosure form specified in Section 2079.16, and shall obtain a signed acknowledgment of receipt from that seller and buyer, except as provided in Section 2079.15, as follows: (a) The seller's agent, if any, shall provide the disclosure form to the seller prior to entering into the listing agreement. (b) The buyer's agent shall provide the disclosure form to the buyer as soon as practicable prior to execution of the buyer's offer to purchase. If the offer to purchase is not prepared by the buyer's agent, the buyer's agent shall present the disclosure form to the buyer not later than the next business day after receiving the offer to purchase from the buyer.
2079.15. In any circumstance in which the seller or buyer refuses to sign an acknowledgment of receipt pursuant to Section 2079.14, the agent shall set forth, sign, and date a written declaration of the facts of the refusal. 2079.16 Reproduced on Page 1 of this AD form.
2079.17(a) As soon as practicable, the buyer's agent shall disclose to the buyer and seller whether the agent is acting in the real property transaction as the buyer's agent, or as a dual agent representing both the buyer and the seller. This relationship shall be confirmed in the contract to purchase and sell real property or in a separate writing executed or acknowledged by the seller, the buyer, and the buyer's agent prior to or coincident with execution of that contract by the buyer and the seller, respectively. (b) As soon as practicable, the seller's agent shall disclose to the seller whether the seller's agent is acting in the real property transaction as the seller's agent, or as a dual agent representing both the buyer and seller. This relationship shall be confirmed in the contract to purchase and sell real property or in a separate writing executed or acknowledged by the seller and the seller's agent prior to or coincident with the execution of that contract by the seller.

CONFIRMATION: (c) The confirmation required by subdivisions (a) and (b) shall be in the following form:

Seller's Brokerage Firm DO NOT COMPLETE. SAMPLE ONLY License Number ______________ Is the broker of (check one): the seller; or both the buyer and seller. (dual agent) Seller's Agent DO NOT COMPLETE. SAMPLE ONLY License Number ______________ Is (check one): the Seller's Agent. (salesperson or broker associate) both the Buyer's and Seller's Agent. (dual agent) Buyer's Brokerage Firm DO NOT COMPLETE. SAMPLE ONLY License Number ______________ Is the broker of (check one): the buyer; or both the buyer and seller. (dual agent) Buyer's Agent DO NOT COMPLETE. SAMPLE ONLY License Number ______________ Is (check one): the Buyer's Agent. (salesperson or broker associate) both the Buyer's and Seller's Agent. (dual agent) (d) The disclosures and confirmation required by this section shall be in addition to the disclosure required by Section 2079.14. An agent's duty to provide disclosure and confirmation of representation in this section may be performed by a real estate salesperson or broker associate affiliated with that broker. 2079.18 (Repealed pursuant to AB-1289)
2079.19 The payment of compensation or the obligation to pay compensation to an agent by the seller or buyer is not necessarily determinative of a particular agency relationship between an agent and the seller or buyer. A listing agent and a selling agent may agree to share any compensation or commission paid, or any right to any compensation or commission for which an obligation arises as the result of a real estate transaction, and the terms of any such agreement shall not necessarily be determinative of a particular relationship. 2079.20 Nothing in this article prevents an agent from selecting, as a condition of the agent's employment, a specific form of agency relationship not specifically prohibited by this article if the requirements of Section 2079.14 and Section 2079.17 are complied with. 2079.21 (a) A dual agent may not, without the express permission of the seller, disclose to the buyer any confidential information obtained from the seller. (b) A dual agent may not, without the express permission of the buyer, disclose to the seller any confidential information obtained from the buyer. (c) “Confidential information” means facts relating to the client's financial position, motivations, bargaining position, or other personal information that may impact price, such as the seller is willing to accept a price less than the listing price or the buyer is willing to pay a price greater than the price offered. (d) This section does not alter in any way the duty or responsibility of a dual agent to any principal with respect to confidential information other than price. 2079.22 Nothing in this article precludes a seller's agent from also being a buyer's agent. If a seller or buyer in a transaction chooses to not be represented by an agent, that does not, of itself, make that agent a dual agent. 2079.23 A contract between the principal and agent may be modified or altered to change the agency relationship at any time before the performance of the act which is the object of the agency with the written consent of the parties to the agency relationship. 2079.24 Nothing in this article shall be construed to either diminish the duty of disclosure owed buyers and sellers by agents and their associate licensees, subagents, and employees or to relieve agents and their associate licensees, subagents, and employees from liability for their conduct in connection with acts governed by this article or for any breach of a fiduciary duty or a duty of disclosure. © 2021, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
AD REVISED 12/21 (PAGE 2 OF 2)
DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP (AD PAGE 2 OF 2) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 &16726 76

FAIR HOUSING AND DISCRIMINATION ADVISORY
(C.A.R. Form FHDA, Revised 6/23)

1. EQUAL ACCESS TO HOUSING FOR ALL: All housing in California is available to all persons. Discrimination as noted below is prohibited by law. Resources are available for those who have experienced unequal treatment under the law.

2. FEDERAL AND STATE LAWS PROHIBIT DISCRIMINATION AGAINST IDENTIFIED PROTECTED CLASSES:

A. FEDERAL FAIR HOUSING ACT (“FHA”) Title VIII of the Civil Rights Act; 42 U.S.C. §§ 3601-3619; Prohibits discrimination in sales, rental or financing of residential housing against persons in protected classes; B. CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT (“FEHA”) California Government Code (“GC”) §§ 12900- 12996,12955; 2 California Code of Regulations (“CCR”) §§ 12005-12271; Prohibits discrimination in sales, rental or financing of housing opportunity against persons in protected classes by providers of housing accommodation and financial assistance services as related to housing;
C. CALIFORNIA UNRUH CIVIL RIGHTS ACT (“Unruh”) California Civil Code (“CC”) § 51; Prohibits business establishments from discriminating against, and requires full and equal accommodation, advantages, facilities, privileges, and services to persons in protected classes;
D. AMERICANS WITH DISABILITIES ACT (“ADA”) 42 U.S.C. §§ 12181-12189; Title III of the ADA prohibits discrimination based on disability in public accommodations; and
E. OTHER FAIR HOUSING LAWS: § 504 of Rehabilitation Act of 1973 29 U.S.C. § 794; Ralph Civil Rights Act CC § 51.7; California Disabled Persons Act; CC §§ 54-55.32; any local city or county fair housing ordinances, as applicable.

3. POTENTIAL LEGAL REMEDIES FOR UNLAWFUL DISCRIMINATION: Violations of fair housing laws may result in monetary civil fines, injunctive relief, compensatory and/or punitive damages, and attorney fees and costs.

4. PROTECTED CLASSES/CHARACTERISTICS: Whether specified in Federal or State law or both, discrimination against persons based on that person's belonging to, association with, or perceived membership in, certain classes or categories, such as the following, is prohibited. Other classes, categories or restrictions may also apply.

Race Color Ancestry National Origin Religion
Age Sex, Sexual Orientation Gender, Gender Identity,
Gender expression
Marital Status Familial Status (family with
a child or children under
18)
Citizenship Immigration Status Primary Language Military/Veteran Status Source of Income (e.g., Section 8 Voucher)
Medical Condition Disability (Mental & Physical) Genetic Information Criminal History (nonrelevant convictions)Any arbitrary characteristic

5. THE CALIFORNIA DEPARTMENT OF REAL ESTATE REQUIRES TRAINING AND SUPERVISION TO PREVENT HOUSING DISCRIMINATION BY REAL ESTATE LICENSEES:

A. California Business & Professions Code (“B&PC”) § 10170.5(a)(4) requires 3 hours of training on fair housing for DRE license renewal; Real Estate Regulation § 2725(f) requires brokers who oversee salespersons to be familiar with the requirements of federal and state laws relating to the prohibition of discrimination.

B. Violation of DRE regulations or real estate laws against housing discrimination by a real estate licensee may result in the loss or suspension of the licensee's real estate license. B&PC §10177(l)(1); 10 CCR § 2780

6. REALTOR® ORGANIZATIONS PROHIBIT DISCRIMINATION: NAR Code of Ethics Article 10 prohibits discrimination in employment practices or in rendering real estate license services against any person because of race, color, religion, sex, disability, familial status, national origin, sexual orientation, or gender identity by REALTORS®.

7. WHO IS REQUIRED TO COMPLY WITH FAIR HOUSING LAWS?
Below is a non-exclusive list of providers of housing accommodations or financial assistance services as related to housing who are most likely to be encountered in a housing transaction and who must comply with fair housing laws. ● Sellers ● Landlords/Housing Providers ● Sublessors
● Real estate licensees ● Real estate brokerage firms ● Property managers ● Mobilehome parks ● Homeowners Associations (“HOAs”); ● Banks and Mortgage lenders ● Insurance companies ● Government housing services ● Appraisers

8. EXAMPLES OF CONDUCT THAT MAY NOT BE MOTIVATED BY DISCRIMINATORY INTENT BUT COULD HAVE A DISCRIMINATORY EFFECT:

A. Prior to acceptance of an offer, asking for or offering buyer personal information or letters from the buyer, especially with photos.

Those types of documents may inadvertently reveal, or be perceived as revealing, protected status information thereby increasing the risk of (i) actual or unconscious bias, and (ii) potential legal claims against sellers and others by prospective buyers whose offers were rejected.

B. Refusing to rent (i) an upper-level unit to an elderly tenant out of concern for the tenant's ability to navigate stairs or (ii) a house with a pool to a person with young children out of concern for the children's safety.

9. EXAMPLES OF UNLAWFUL OR IMPROPER CONDUCT BASED ON A PROTECTED CLASS OR CHARACTERISTIC:

A. Refusing to negotiate for a sale, rental or financing or otherwise make a housing opportunity unavailable; failing to present offers due to a person's protected status;
B. Refusing or failing to show, rent, sell or finance housing; “channeling” or “steering” a prospective buyer or tenant to or away from a particular area due to that person's protected status or because of the racial, religious or ethnic composition of the neighborhood; C. “Blockbusting” or causing “panic selling” by inducing a listing, sale or rental based on the grounds of loss of value of property, increase in crime, or decline in school quality due to the entry or prospective entry of people in protected categories into the neighborhood;
D. Making any statement or advertisement that indicates any preference, limitation, or discrimination; © 2023, California Association of REALTORS®, Inc.

FHDA REVISED 6/23 (PAGE 1 OF 2)
FAIR HOUSING AND DISCRIMINATION ADVISORY (FHDA PAGE 1 OF 2) Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
77 E. Inquiring about protected characteristics (such as asking tenant applicants if they are married, or prospective purchasers if they have children or are planning to start a family);
F. Using criminal history information before otherwise affirming eligibility, and without a legally sufficient justification; G. Failing to assess financial standards based on the portion of the income responsible by a tenant who receives government subsidies (such as basing an otherwise neutral rent to income ratio on the whole rent rather than just the part of rent that is the tenant's responsibility);
H. Denying a home loan or homeowner's insurance;
I. Offering inferior terms, conditions, privileges, facilities or services; J. Using different qualification criteria or procedures for sale or rental of housing such as income standards, application requirements, application fees, credit analyses, sale or rental approval procedures or other requirements; K. Harassing a person;
L. Taking an adverse action based on protected characteristics; M. Refusing to permit a reasonable modification to the premises, as requested by a person with a disability (such as refusing to allow a tenant who uses a wheelchair to install, at their expense, a ramp over front or rear steps, or refusing to allow a tenant with a disability from installing, at their own expense, grab bars in a shower or bathtub); N. Refusing to make reasonable accommodation in policies, rules, practices, or services for a person with a disability (such as the following, if an actual or prospective tenant with a disability has a service animal or support animal):
(i) Failing to allow that person to keep the service animal or emotional support animal in rental property, (ii) Charging that person higher rent or increased security deposit, or (iii) Failing to show rental or sale property to that person who is accompanied by the service animal or support animal, and; O. Retaliating for asserting rights under fair housing laws.

10. EXAMPLES OF POSITIVE PRACTICES:

A. Real estate licensees working with buyers or tenants should apply the same objective property selection criteria, such as location/neighborhood, property features, and price range and other considerations, to all prospects.

B. Real estate licensees should provide complete and objective information to all clients based on the client's selection criteria.

C. Real estate licensees should provide the same professional courtesy in responding to inquiries, sharing of information and offers of assistance to all clients and prospects.

D. Housing providers should not make any statement or advertisement that directly or indirectly implies preference, limitation, or discrimination regarding any protected characteristic (such as “no children” or “English-speakers only”).

E. Housing providers should use a selection process relying on objective information about a prospective buyer's offer or tenant's application and not seek any information that may disclose any protected characteristics (such as using a summary document, e.g. C.A.R. Form SUM-MO, to compare multiple offers on objective terms).

11. FAIR HOUSING RESOURCES: If you have questions about your obligations or rights under the Fair Housing laws, or you think you have been discriminated against, you may want to contact one or more of the sources listed below to discuss what you can do about it, and whether the resource is able to assist you.

A. Federal: https://www.hud.gov/program_offices/fair_housing_equal_opp B. State: https://calcivilrights.ca.gov/housing/
C. Local: local Fair Housing Council office (non-profit, free service) D. DRE: https://www.dre.ca.gov/Consumers/FileComplaint.html E. Local Association of REALTORS®. List available at: https://www.car.org/en/contactus/rosters/localassociationroster.

F. Any qualified California fair housing attorney, or if applicable, landlord-tenant attorney.

12. LIMITED EXCEPTIONS TO FAIR HOUSING REQUIREMENTS: No person should rely on any exception below without first seeking legal advice about whether the exception applies to their situation. Real estate licensees are not qualified to provide advice on the application of these exceptions.

A. Legally compliant senior housing is exempt from FHA, FEHA and Unruh as related to age or familial status only; B. An owner of a single-family residence who resides at the property with one lodger may be exempt from FEHA for rental purposes, PROVIDED no real estate licensee is involved in the rental; C. An owner of a single-family residence may be exempt from FHA for sale or rental purposes, PROVIDED (i) no real estate licensee is involved in the sale or rental and (ii) no discriminatory advertising is used, and (iii) the owner owns no more than three single-family residences. Other restrictions apply; D. An owner of residential property with one to four units who resides at the property, may be exempt from FHA for rental purposes, PROVIDED no real estate licensee is involved in the rental; and E. Both FHA and FEHA do not apply to roommate situations. See, Fair Housing Council v Roommate.com LLC, 666 F.3d 1216 (2019).

F. Since both the 14th Amendment of the U.S. Constitution and the Civil Rights Act of 1866 prohibit discrimination based on race; the FHA and FEHA exemptions do not extend to discrimination based on race.

Buyer/Tenant and Seller/Housing Provider have read, understand and acknowledge receipt of a copy of this Fair Housing & Discrimination Advisory.

Buyer/Tenant Date
Buyer/Tenant Date
Seller/Housing Provider Date
Seller/Housing Provider Date
© 2023, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
FHDA REVISED 6/23 (PAGE 2 OF 2)
FAIR HOUSING AND DISCRIMINATION ADVISORY (FHDA PAGE 2 OF 2) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com City of Fontana
J. Esther Taylor
16710 &16726 78

WIRE FRAUD AND ELECTRONIC FUNDS

TRANSFER ADVISORY
(C.A.R. Form WFA, Revised 12/21)
Property Address: (“Property”).

WIRE FRAUD AND ELECTRONIC FUNDS TRANSFERS ADVISORY:

The ability to communicate and conduct business electronically is a convenience and reality in nearly all parts of our lives.

At the same time, it has provided hackers and scammers new opportunities for their criminal activity. Many businesses have been victimized and the real estate business is no exception.

While wiring or electronically transferring funds is a welcome convenience, we all need to exercise extreme caution.

Emails attempting to induce fraudulent wire transfers have been received and have appeared to be legitimate. Reports indicate that some hackers have been able to intercept emailed transfer instructions, obtain account information and, by altering some of the data, redirect the funds to a different account. It also appears that some hackers were able to provide false phone numbers for verifying the wiring or funds transfer instructions. In those cases, the victim called the number provided to confirm the instructions, and then unwittingly authorized a transfer to somewhere or someone other than the intended recipient.

ACCORDINGLY, YOU ARE ADVISED:

1. Obtain phone numbers and account numbers only from Escrow Officers, Property Managers, or Landlords at the beginning of the transaction.

2. DO NOT EVER WIRE OR ELECTRONICALLY TRANSFER FUNDS PRIOR TO CALLING TO CONFIRM THE TRANSFER INSTRUCTIONS. ONLY USE A PHONE NUMBER YOU WERE PROVIDED PREVIOUSLY. Do not use any different phone number or account number included in any emailed transfer instructions.

3. Orally confirm the transfer instruction is legitimate and confirm the bank routing number, account numbers and other codes before taking steps to transfer the funds.

4. Avoid sending personal information in emails or texts. Provide such information in person or over the telephone directly to the Escrow Officer, Property Manager, or Landlord.

5. Take steps to secure the system you are using with your email account. These steps include creating strong passwords, using secure WiFi, and not using free services.

If you believe you have received questionable or suspicious wire or funds transfer instructions, immediately notify your bank, and the other party, and the Escrow Office, Landlord, or Property Manager. The sources below, as well as others, can also provide information:

Federal Bureau of Investigation: https://www.fbi.gov/; the FBI's IC3 at www.ic3.gov; or 310-477-6565 National White Collar Crime Center: http://www.nw3c.org/ On Guard Online: https://www.onguardonline.gov/
NOTE: There are existing alternatives to electronic and wired fund transfers such as cashier's checks.

By signing below, the undersigned acknowledge that each has read, understands and has received a copy of this Wire Fraud and Electronic Funds Transfer Advisory.

Buyer/Tenant Date
Buyer/Tenant Date
Seller/Landlord Date
Seller/Landlord Date
©2021, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
WFA REVISED 12/21 (PAGE 1 OF 1)
WIRE FRAUD AND ELECTRONIC FUNDS TRANSFER ADVISORY (WFA PAGE 1 OF 1) Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335
City of Fontana
J. Esther Taylor
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
79 COMMERCIAL PURCHASE AGREEMENT

AND JOINT ESCROW INSTRUCTIONS
(C.A.R. Form CPA, Revised 12/22)
Date Prepared:

1. OFFER:

A. THIS IS AN OFFER FROM (“Buyer”).

Individual(s), A Corporation, A Partnership, An LLC, Other .

B. THE PROPERTY to be acquired is , situated
in (City), (County), California, (Zip Code),
Assessor's Parcel No(s). (“Property”).
(Postal/Mailing address may be different from city jurisdiction. Buyer is advised to investigate.) C. THE TERMS OF THE PURCHASE ARE SPECIFIED BELOW AND ON THE FOLLOWING PAGES.

D. Buyer and Seller are referred to herein as the "Parties." Brokers and Agents are not Parties to this Agreement.

2. AGENCY:

A. DISCLOSURE: The Parties each acknowledge receipt of a “Disclosure Regarding Real Estate Agency Relationships” (C.A.R.

Form AD) if represented by a real estate licensee. Buyer's Agent is not legally required to give to Seller's Agent the AD form Signed by Buyer. Seller's Agent is not legally obligated to give to Buyer's Agent the AD form Signed by Seller.

B. CONFIRMATION: The following agency relationships are hereby confirmed for this transaction.

Seller's Brokerage Firm License Number
Is the broker of (check one): the Seller; or both the Buyer and Seller (Dual Agent).

Seller's Agent License Number
Is (check one): the Seller's Agent (Salesperson or broker associate); or both the Buyer's and Seller's Agent (Dual Agent).

Buyer's Brokerage Firm License Number
Is the broker of (check one): the Buyer; or both the Buyer and Seller (Dual Agent).

Buyer's Agent License Number
Is (check one): the Buyer's Agent (Salesperson or broker associate); or both the Buyer's and Seller's Agent (Dual Agent).

C. More than one Brokerage represents Seller, Buyer. See, Additional Broker Acknowledgement (C.A.R. Form ABA).

D. POTENTIALLY COMPETING BUYERS AND SELLERS: The Parties each acknowledge receipt of a “Possible Representation of More than One Buyer or Seller - Disclosure and Consent” (C.A.R. Form PRBS).

3. TERMS OF PURCHASE AND ALLOCATION OF COSTS: The items in this paragraph are contractual terms of the Agreement.

Referenced paragraphs provide further explanation. This form is 17 pages. The Parties are advised to read all 17 pages.

Paragraph
#
Paragraph Title or Contract
Term
Terms and Conditions Additional Terms
A 5, 5B (cash) Purchase Price $ All Cash
B Close Of Escrow (COE) Days after Acceptance
OR on (date)
(mm/dd/yyyy)
C 39A Expiration of Offer 3 calendar days after all Buyer Signature(s) or (date) at 5PM or AM/
PM
D(1) 5A(1) Initial Deposit Amount $ ( % of purchase price) (% number above is for calculation purposes
and is not a contractual term)
within 3 (or ) business days
after Acceptance by wire transfer
OR
D(2) 5A(2) Increased Deposit
(Money placed into escrow after the
initial deposit. Use form DID at time
increased deposit is made.)
$ ( % of purchase price)
(% number above is for calculation purposes
and is not a contractual term)
Upon removal of all contingencies
OR (date)
OR
E(1) 5C(1) Loan Amount(s): First
Interest Rate
Points
$ ( % of purchase price)
Fixed rate or Initial adjustable rate,
● not to exceed %
● Buyer to pay up to points to obtain rate
above
Conventional or, if checked,
Seller Financing
Assumed Financing
Subject To Financing
Other:

If FHA or VA checked, Deliver list of
lender required repairs
17 (or ) Days after Acceptance
E(2) 5C(2) Additional Financed Amount
Interest Rate
Points
$ ( % of purchase price)
Fixed rate or Initial adjustable rate
● not to exceed %
● Buyer to pay up to points to obtain rate
above
Conventional or, if checked,
Seller Financing
Assumed Financing
Subject To Financing
Other:

E(3) 7A Occupancy Type Investment
F 5D Balance of Down Payment $
PURCHASE PRICE TOTAL $
© 2022, California Association of REALTORS®, Inc.

CPA REVISED 12/22 (PAGE 1 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 1 OF 17) Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com February 19, 2024
City of Fontana
X a California municipal corporation
16710 & 16726 Spring St
Fontana San Bernardino 92335
0191-161-18-0000 and 0191-161-13-0000
Sierra Realty Fontana Inc 02038519
X
Ken Galasso 00570875
X
X
1,500,000.00 X
X 60
25,000.00 1.67 10
1,475,000.00
1,500,000.00
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
80 Property Address: Date:

Paragraph
#
Paragraph Title or Contract
Term
Terms and Conditions Additional Terms
G(1) 5E Seller Credit, if any, to Buyer $ ( % of purchase price) (% number above is for calculation purposes
and is not a contractual term)
Seller credit to be applied to closing
costs OR
Other:

G(2) ADDITIONAL FINANCE TERMS:

G(3) 21 Seller agrees to pay the obligation of Buyer to compensate Buyer's Broker under a separate agreement (C.A.R.

Form SPBB attached). Seller's Broker's offer, if any, to compensate Buyer's Broker is unaffected unless Otherwise Agreed.

H(1) 5B Verification of All Cash (sufficient
funds)
Attached to the offer or 3 (or ) Days
after Acceptance
H(2) 6A Verification of Down Payment and
Closing Costs
Attached to the offer or 3 (or ) Days
after Acceptance
H(3) 6B Verification of Loan Application Attached to the offer or 3 (or ) Days after Acceptance
Prequalification Preapproval
I Intentionally Left Blank
J 19 Final Verification of Condition 5 (or ) Days prior to COE K 26 Assignment Request 17 (or ) Days after Acceptance
L 8 CONTINGENCIES TIME TO REMOVE CONTINGENCIES CONTINGENCY REMOVED L(1) 8A Loan(s) 17 (or ) Days after Acceptance No loan contingency L(2) 8B Appraisal: Appraisal contingency
based upon appraised value at a
minimum of purchase price or
$
17 (or ) Days after Acceptance No appraisal contingency Removal of appraisal contingency
does not eliminate appraisal
cancellation rights in FVAC.

L(3) 8C, 15 Investigation of Property 17 (or ) Days after Acceptance Informational Access to Property 17 (or ) Days after Acceptance REMOVAL OR WAIVER OF Buyer's right to access the Property for informational purposes only is NOT a contingency and does NOT create additional cancellation rights for Buyer.

CONTINGENCY:

L(4) 8D, 17A Review of Seller Documents 17 (or ) Days after Acceptance, or 5 Days after Delivery, whichever is later
L(5) 8E, 16A Preliminary ("Title") Report 17 (or ) Days after Acceptance, or 5 Days after Delivery, whichever is later
L(6) 8F, 11C Common Interest Disclosures
required by Civil Code § 4525 or this
Agreement
17 (or ) Days after Acceptance, or 5 Days
after Delivery, whichever is later
CR attached
L(7) 8G, 9B(6) Review of leased or liened items
(Such as for solar panels or propane
tanks or PACE or HERO liens)
17 (or ) Days after Acceptance, or 5 Days
after Delivery, whichever is later
L(8) 8J Sale of Buyer's Property
Sale of Buyer's property is not a
contingency, UNLESS checked here:

C.A.R. Form COP attached
M Possession Time for Performance Additional Terms
M(1) Vacant Units;
Tenant Occupied Units being
delivered subject to tenant rights
Upon notice of recordation
On COE date Tenant Occupied Unit(s) to be
delivered vacant (#s )
M(2) 7C Seller Occupied Upon Notice of recordation, OR 6 PM or AM/ PM
COE date or, if checked below,
days after COE (29 or fewer days)
days after COE (30 or more days)
C.A.R. Form SIP attached if 29
or fewer days. C.A.R. Form CL
attached if 30 or more days.

N Documents/Fees/Compliance Time for Performance
N(1) 17A Seller Delivery of Documents 7 (or ) Days after Acceptance N(2) 22B Sign and return Escrow Holder
General Provisions, Supplemental
Instructions
5 (or ) Days after Delivery
N(3) 11C(2) Time to pay fees for ordering HOA
Documents
3 (or ) Days after Acceptance
N(4) 10B(1) Install smoke alarm(s), CO
detector(s), water heater bracing
7 (or ) Days after Acceptance
N(5) 35 Evidence of representative authority 3 Days after Acceptance CPA REVISED 12/22 (PAGE 2 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 2 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 X
X
45 45
45 45
45 45
X
25 15
16710 &16726 81
Property Address: Date:

O Intentionally Left Blank
P Items Included and Excluded
P(1) 9 Items Included - All items specified in Paragraph 9B are included and the following, if checked:
. . .

P(2) 9 Excluded Items:
; ; ;
Q Allocation of Costs
Paragraph
#
Item Description Who Pays (if Both is checked, cost to be split equally unless Otherwise Agreed)
Additional Terms
Q(1) 10A, 11D Natural Hazard Zone Disclosure
Report, including tax information
Buyer Seller Both Environmental
Other
Provided by:

Q(2) 15B(1)(D) Environmental Survey Buyer Seller Both
Q(3) Report Buyer Seller Both
Q(4) 10B(1) Smoke alarms, CO detectors, water
heater bracing
Buyer Seller Both
Q(5) 10A
10B(2)
Government Required Point of Sale
inspections, reports
Buyer Seller Both
Q(6) 10B(2)(A) Government Required Point of Sale
corrective/remedial actions
Buyer Seller Both
Q(7) 22B Escrow Fees Buyer Seller Both
Each to pay their own fees
Escrow Holder:

Q(8) 16 Owner's title insurance policy Buyer Seller Both Title Company (If different from Escrow Holder):

Q(9) Buyer's Lender title insurance policy Buyer Unless Otherwise Agreed, Buyer shall purchase any title insurance
policy insuring Buyer's lender.

Q(10) County transfer tax, fees Buyer Seller Both
Q(11) City transfer tax, fees Buyer Seller Both
Q(12) 11C(2) HOA fee for preparing disclosures Seller
Q(13) HOA certification fee Buyer
Q(14) HOA transfer fees Buyer Seller Both Unless Otherwise Agreed, Seller shall pay for separate HOA moveout fee and Buyer shall pay for separate move-in fee. Applies if
separately billed or itemized with
cost in transfer fee.

Q(15) Private transfer fees Seller, or if checked, Buyer Both Q(16) 10B(4) Installation of safety features, required
by law
Buyer Seller Both
Q(17) fees or costs Buyer Seller Both
R Additional Tenancy Documents: Income and Expense Statements Tenant Estoppel Certificate S OTHER TERMS:

4. PROPERTY ADDENDA AND ADVISORIES: (check all that apply) A. PROPERTY TYPE ADDENDA: This Agreement is subject to the terms contained in the Addenda checked below:

Probate Agreement Purchase Addendum (C.A.R. Form PA-PA) Other
B. OTHER ADDENDA: This Agreement is subject to the terms contained in the Addenda checked below:

Addendum # (C.A.R. Form ADM) Assumed Financing Addendum (C.A.R. Form AFA) Short Sale Addendum (C.A.R. Form SSA)
Back Up Offer Addendum (C.A.R. Form BUO) Court Confirmation Addendum (C.A.R. Form CCA) Septic, Well, Property Monument and Propane Addendum (C.A.R. Form SWPI) Buyer Intent to Exchange Addendum (C.A.R. Form BXA) Seller Intent to Exchange Addendum (C.A.R. Form SXA) Other Other
CPA REVISED 12/22 (PAGE 3 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 3 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 X
Escrow provider to select
X if desired
X
X
Bennett Escrow
X
Orange Coast
Title
16710 &16726 82
Property Address: Date:

C. BUYER AND SELLER ADVISORIES: (Note: All Advisories below are provided for reference purposes only and are not intended to be incorporated into this Agreement.)
Buyer's Investigation Advisory (C.A.R. Form BIA) Fair Housing and Discrimination Advisory (C.A.R. Form FHDA) Wire Fraud Advisory (C.A.R. Form WFA) Cal. Consumer Privacy Act Advisory (C.A.R. Form CCPA) (Parties may also receive a privacy disclosure from their own Agent.) Wildfire Disaster Advisory (C.A.R. Form WFDA) Statewide Buyer and Seller Advisory (C.A.R. Form SBSA) Trust Advisory (C.A.R. Form TA) Short Sale Information and Advisory (C.A.R. Form SSIA) REO Advisory (C.A.R. Form REO) Probate Advisory (C.A.R. Form PA) Other: Other:

5. ADDITIONAL TERMS AFFECTING PURCHASE PRICE: Buyer represents that funds will be good when deposited with Escrow Holder.

A. DEPOSIT:
(1) INITIAL DEPOSIT: Buyer shall deliver deposit directly to Escrow Holder. If a method other than wire transfer is specified in paragraph 3D(1) and such method is unacceptable to Escrow Holder, then upon notice from Escrow Holder, delivery shall be by wire transfer.
(2) INCREASED DEPOSIT: Increased deposit to be delivered to Escrow Holder in the same manner as the Initial Deposit. If the Parties agree to liquidated damages in this Agreement, they also agree to incorporate the increased deposit into the liquidated damages amount by signing a new liquidated damages clause (C.A.R. Form DID) at the time the increased deposit is delivered to Escrow Holder.
(3) RETENTION OF DEPOSIT: Paragraph 36, if initialed by all Parties or otherwise incorporated into this Agreement, specifies a remedy for Buyer's default. Buyer and Seller are advised to consult with a qualified California real estate attorney: (i) Before adding any other clause specifying a remedy (such as release or forfeiture of deposit or making a deposit non-refundable) for failure of Buyer to complete the purchase. Any such clause shall be deemed invalid unless the clause independently satisfies the statutory liquidated damages requirements set forth in the Civil Code; and (ii) Regarding possible liability and remedies if Buyer fails to deliver the deposit.

B. ALL CASH OFFER: If an all cash offer is specified in paragraph 3A, no loan is needed to purchase the Property. This Agreement is NOT contingent on Buyer obtaining a loan. Buyer shall, within the time specified in paragraph 3H(1), Deliver written verification of funds sufficient for the purchase price and closing costs.

C. LOAN(S):
(1) FIRST LOAN: This loan will provide for conventional financing UNLESS FHA, VA, Seller Financing (C.A.R. Form SFA), Subject To Financing, Assumed Financing, or Other is checked in paragraph 3E(1). (2) ADDITIONAL FINANCED AMOUNT: If an additional financed amount is specified in paragraph 3E(2), that amount will provide for conventional financing UNLESS Seller Financing (C.A.R. Form SFA), Subject To Financing, Assumed Financing, or Other is checked in paragraph 3E(2).
(3) BUYER'S LOAN STATUS: Buyer authorizes Seller and Seller's Authorized Agent to contact Buyer's lender(s) to determine the status of any Buyer's loan specified in paragraph 3E, or any alternate loan Buyer pursues, whether or not a contingency of this Agreement. If the contact information for Buyer's lender(s) is different from that provided under the terms of paragraph 6B, Buyer shall Deliver the updated contact information within 1 Day of Seller's request. (4) ASSUMED OR SUBJECT TO FINANCING: Seller represents that Seller is not delinquent on any payments due on any loans. If the Property is acquired subject to an existing loan, Buyer and Seller are advised to consult with legal counsel regarding the ability of an existing lender to call the loan due, and the consequences thereof. (5) Buyer shall, within the time specified in paragraph 3E(1), Deliver to Seller written notice (C.A.R. Form RR or AEA) (i) of any lender requirements that Buyer requests Seller to pay for or otherwise correct or (ii) that there are no lender requirements.

D. BALANCE OF PURCHASE PRICE (DOWN PAYMENT) (including all-cash funds) to be deposited with Escrow Holder pursuant to Escrow Holder instructions.

E. LIMITS ON CREDITS TO BUYER: Any credit to Buyer, from any source, for closing or other costs that is agreed to by the Parties (“Contractual Credit”) shall be disclosed to Buyer's lender, if any, and made at Close Of Escrow. If the total credit allowed by Buyer's lender (“Lender Allowable Credit”) is less than the Contractual Credit, then (i) the Contractual Credit from Seller shall be reduced to the Lender Allowable Credit, and (ii) in the absence of a separate written agreement between the Parties, there shall be no automatic adjustment to the purchase price to make up for the difference between the Contractual Credit and the Lender Allowable Credit.

6. ADDITIONAL FINANCING TERMS:

A. VERIFICATION OF DOWN PAYMENT AND CLOSING COSTS: Written verification of Buyer's down payment and closing costs may be made by Buyer or Buyer's lender or loan broker pursuant to paragraph 6B.

B. VERIFICATION OF LOAN APPLICATIONS: Buyer shall Deliver to Seller, within the time specified in paragraph 3H(3) a letter from Buyer's lender or loan broker stating that, based on a review of Buyer's written application and credit report, Buyer is prequalified or preapproved for any NEW loan specified in paragraph 3E. If any loan specified in paragraph 3E is an adjustable rate loan, the prequalification or preapproval letter shall be based on the qualifying rate, not the initial loan rate.

C. BUYER STATED FINANCING: Seller is relying on Buyer's representation of the type of financing specified (including, but not limited to, as applicable, all cash, amount of down payment, or contingent or non-contingent loan). Seller has agreed to a specific closing date, purchase price, and to sell to Buyer in reliance on Buyer's specified financing. Buyer shall pursue the financing specified in this Agreement, even if Buyer also elects to pursue an alternative form of financing. Seller has no obligation to cooperate with Buyer's efforts to obtain any financing other than that specified in this Agreement but shall not interfere with closing at the purchase price on the COE date (paragraph 3B) even if based upon alternate financing. Buyer's inability to obtain alternate financing does not excuse Buyer from the obligation to purchase the Property and close escrow as specified in this Agreement.

7. CLOSING AND POSSESSION:

A. OCCUPANCY: Buyer intends to occupy the Property as indicated in paragraph 3E(3). Occupancy may impact available financing.

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B. CONDITION OF PROPERTY ON CLOSING:
(1) Unless Otherwise Agreed: (i) the Property shall be delivered “As-Is” in its PRESENT physical condition as of the date of Acceptance; (ii) the Property, including pool, spa, landscaping and grounds, is to be maintained in substantially the same condition as on the date of Acceptance; and (iii) all debris and personal property not included in the sale shall be removed by Close Of Escrow or at the time possession is delivered to Buyer, if not on the same date. If items are not removed when possession is delivered to Buyer, all items shall be deemed abandoned. Buyer, after first Delivering to Seller written notice to remove the items within 3 Days, may pay to have such items removed or disposed of and may bring legal action, as per this Agreement, to receive reasonable costs from Seller. (2) Buyer is strongly advised to conduct investigations of the entire Property in order to determine its present condition. Seller and Agents may not be aware of all defects affecting the Property or other factors that Buyer considers important. Property improvements may not be built according to code, in compliance with current Law, or have had all required permits issued and/or finalized.

C. SELLER REMAINING IN POSSESSION AFTER CLOSE OF ESCROW: If Seller has the right to remain in possession after Close Of Escrow pursuant to paragraph 3M(2) or as Otherwise Agreed, (i) the Parties are advised to consult with their insurance and legal advisors for information about liability and damage or injury to persons and personal and real property; (ii) Buyer is advised to consult with Buyer's lender about the impact of Seller's occupancy on Buyer's loan; and (iii) consult with a qualified California real estate attorney where the Property is located to determine the ongoing rights and responsibilities of both Buyer and Seller with regard to each other, including possible tenant rights, and what type of written agreement to use to document the relationship between the Parties.

D. At Close Of Escrow: (i) Seller assigns to Buyer any assignable warranty rights for items included in the sale; and (ii) Seller shall Deliver to Buyer available Copies of any such warranties. Agents cannot and will not determine the assignability of any warranties.

E. Seller shall, on Close Of Escrow unless Otherwise Agreed and even if Seller remains in possession, provide keys, passwords, codes and/or means to operate all locks, mailboxes, security systems, alarms, home automation systems, intranet and Internet-connected devices included in the purchase price, garage door openers, and all items included in either paragraph 3P or paragraph 9. If the Property is a condominium or located in a common interest development, Seller shall be responsible for securing or providing any such items for Association amenities, facilities, and access. Buyer may be required to pay a deposit to the Owners' Association (“HOA”) to obtain keys and accessible HOA facilities.

8. CONTINGENCIES AND REMOVAL OF CONTINGENCIES:

A. LOAN(S):
(1) This Agreement is, unless otherwise specified in paragraph 3L(1) or an attached CR form, contingent upon Buyer obtaining the loan(s) specified. If contingent, Buyer shall act diligently and in good faith to obtain the designated loan(s). If there is no appraisal contingency or the appraisal contingency has been waived or removed, then failure of the Property to appraise at the purchase price does not entitle Buyer to exercise the cancellation right pursuant to the loan contingency if Buyer is otherwise qualified for the specified loan and Buyer is able to satisfy lender's non-appraisal conditions for closing the loan.
(2) Buyer is advised to investigate the insurability of the Property as early as possible, as this may be a requirement for lending. Buyer's ability to obtain insurance for the Property, including fire insurance, is part of Buyer's Investigation of Property contingency. Failure of Buyer to obtain insurance may justify cancellation based on the Investigation contingency but not the loan contingency.
(3) Buyer's contractual obligations regarding deposit, balance of down payment and closing costs are not contingencies of this Agreement, unless Otherwise Agreed.
(4) If there is an appraisal contingency, removal of the loan contingency shall not be deemed removal of the appraisal contingency. (5) NO LOAN CONTINGENCY: If "No loan contingency" is checked in paragraph 3L(1), obtaining any loan specified is NOT a contingency of this Agreement. If Buyer does not obtain the loan specified, and as a result is unable to purchase the Property, Seller may be entitled to Buyer's deposit or other legal remedies.

B. APPRAISAL:
(1) This Agreement is, unless otherwise specified in paragraph 3L(2) or an attached CR form, contingent upon a written appraisal of the Property by a licensed or certified appraiser at no less than the amount specified in paragraph 3L(2), without requiring repairs or improvements to the Property. Appraisals are often a reliable source to verify square footage of the subject Property. However, the ability to cancel based on the measurements provided in an appraisal falls within the Investigation of Property contingency. The appraisal contingency is solely limited to the value determined by the appraisal.

For any cancellation based upon this appraisal contingency, Buyer shall Deliver a Copy of the written appraisal to Seller, upon request by Seller.
(2) NO APPRAISAL CONTINGENCY: If "No appraisal contingency" is checked in paragraph 3L(2), then Buyer may not use the loan contingency specified in paragraph 3L(1) to cancel this Agreement if the sole reason for not obtaining the loan is that the appraisal relied upon by Buyer's lender values the property at an amount less than that specified in paragraph 3L(2). If Buyer is unable to obtain the loan specified solely for this reason, Seller may be entitled to Buyer's deposit or other legal remedies.
(3) Fair Appraisal Act: The Parties acknowledge receipt of the attached Fair Appraisal Act Addendum (C.A.R. Form FAAA).

C. INVESTIGATION OF PROPERTY: This Agreement is, as specified in paragraph 3L(3), contingent upon Buyer's acceptance of the condition of, and any other matter affecting, the Property.

D. REVIEW OF SELLER DOCUMENTS: This Agreement is, as specified in paragraph 3L(4), contingent upon Buyer's review and approval of Seller's documents required in paragraph 16A.

E. TITLE:
(1) This Agreement is, as specified in paragraph 3L(5), contingent upon Buyer's ability to obtain the title policy provided for in paragraph 16G and on Buyer's review of a current Preliminary Report and items that are disclosed or observable even if not on record or not specified in the Preliminary Report, and satisfying Buyer regarding the current status of title. Buyer is advised to review all underlying documents and other matters affecting title, including, but not limited to, any documents or deeds referenced in the Preliminary Report and any plotted easements. (2) Buyer has 5 Days after receipt to review a revised Preliminary Report, if any, furnished by the Title Company and cancel the transaction if the revised Preliminary Report reveals material or substantial deviations from a previously provided Preliminary Report.

F. CONDOMINIUM/PLANNED DEVELOPMENT DISCLOSURES (IF APPLICABLE): This Agreement is, as specified in paragraph 3L(6), contingent upon Buyer's review and approval of Common Interest Disclosures required by Civil Code § 4525 and under paragraph 11C (“CI Disclosures”).

CPA REVISED 12/22 (PAGE 5 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 5 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 X
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G. BUYER REVIEW OF LEASED OR LIENED ITEMS CONTINGENCY: Buyer's review of and ability and willingness to assume any lease, maintenance agreement or other ongoing financial obligation, or to accept the Property subject to any lien, disclosed pursuant to paragraph 9B(6), is, as specified in paragraph 3L(7), a contingency of this Agreement. Any assumption of the lease shall not require any financial obligation or contribution by Seller. Seller, after first Delivering a Notice to Buyer to Perform, may cancel this Agreement if Buyer, by the time specified in paragraph 3L(7), refuses to enter into any necessary written agreements to accept responsibility for all obligations of Seller disclosed leased or liened items.

H. REMOVAL OR WAIVER OF CONTINGENCIES WITH OFFER: Buyer shall have no obligation to remove a contractual contingency unless Seller has provided all required documents, reports, disclosures, and information pertaining to that contingency. If Buyer does remove a contingency without first receiving all required information from Seller, Buyer is relinquishing any contractual rights that apply to that contingency. If Buyer removes or waives any contingencies without an adequate understanding of the Property's condition or Buyer's ability to purchase, Buyer is acting against the advice of Agent.

I. REMOVAL OF CONTINGENCY OR CANCELLATION:
(1) For any contingency specified in paragraph 3L, 8, or elsewhere, Buyer shall, within the applicable period specified, remove the contingency or cancel this Agreement. (2) For the contingencies for review of Seller Documents, Preliminary Report, and Condominium/Planned Development Disclosures, Buyer shall, within the time specified in paragraph 3L or 5 Days after Delivery of the applicable Seller Documents, Preliminary Report, or CI Disclosures, whichever occurs later, remove the applicable contingency in writing or cancel this Agreement.
(3) If Buyer does not remove a contingency within the time specified, Seller, after first giving Buyer a Notice to Buyer to Perform (C.A.R. Form NBP), shall have the right to cancel this Agreement.

J. SALE OF BUYER'S PROPERTY: This Agreement and Buyer's ability to obtain financing are NOT contingent upon the sale of any property owned by Buyer unless the Sale of Buyer's Property (C.A.R. Form COP) is checked as a contingency of this Agreement in paragraph 3L(8).

9. ITEMS INCLUDED IN AND EXCLUDED FROM SALE:

A. NOTE TO BUYER AND SELLER: Items listed as included or excluded in the Multiple Listing Service (MLS), flyers, marketing materials, or disclosures are NOT included in the purchase price or excluded from the sale unless specified in this paragraph or paragraph 3P or as Otherwise Agreed. Any items included herein are components of the Property and are not intended to affect the price. All items are transferred without Seller warranty.

B. ITEMS INCLUDED IN SALE:
(1) All EXISTING fixtures and fittings that are attached to the Property; (2) EXISTING electrical, mechanical, lighting, plumbing and heating fixtures, ceiling fans, fireplace inserts, gas logs and grates, solar power systems, built-in appliances and appliances for which special openings or encasements have been made (whether or not included in paragraph 3P), window and door screens, awnings, shutters, window coverings (which includes blinds, curtains, drapery, shutters or any other materials that cover any portion of the window) and any associated hardware and rods, attached floor coverings, television antennas, satellite dishes, air coolers/conditioners, pool/spa equipment (including, but not limited to, any cleaning equipment such as motorized/automatic pool cleaners, pool heaters, pool nets, pool covers), garage door openers/remote controls, mailbox, in-ground landscaping, water features and fountains, water softeners, water purifiers, light bulbs (including smart bulbs) and all items specified as included in paragraph 3P, if currently existing and owned by Seller at the time of Acceptance.

Note: If Seller does not intend to include any item specified as being included above because it is not owned by Seller, whether placed on the Property by Agent, stager, tenant, or other third party, the item should be listed as being excluded in paragraph 3P(2) or excluded by Seller in a counter offer. (3) Security System includes any devices, hardware, software, or control units used to monitor and secure the Property, including but not limited to, any motion detectors, door or window alarms, and any other equipment utilized for such purpose. If checked in paragraph 3P, all such items are included in the sale, whether hard wired or not. Buyer is advised to use paragraph 3P(1) or an addendum to address more directly specific items to be included. Seller is advised to use a counter offer to address more directly any items to be excluded. (4) Home Automation (Smart Home Features) includes any electronic devices and features including, but not limited to, thermostat controls, kitchen appliances not otherwise excluded, and lighting systems, that are connected (hard wired or wirelessly) to a control unit, computer, tablet, phone, or other “smart” device. Any Smart Home devices and features that are physically affixed to the real property, and also existing light bulbs, are included in the sale. Buyer is advised to use paragraph 3P(1) or an addendum to address more directly specific items to be included. Seller is advised to use a counter offer to address more directly any items to be excluded. (5) Non-Dedicated Devices: All smart home and security system control devices are included in the sale, except for any nondedicated personal computer, tablet, or phone used to control such features. Buyer acknowledges that a separate device and access to wifi or Internet may be required to operate some smart home features and Buyer may have to obtain such device after Close Of Escrow. Seller shall de-list any devices from any personal accounts and shall cooperate with any transfer of services to Buyer. Buyer is advised to change all passwords and ensure the security of any smart home features. (6) LEASED OR LIENED ITEMS AND SYSTEMS: Seller, within the time specified in paragraph 3N(1), shall (i) disclose to Buyer if any item or system specified in paragraph 3P or 9B or otherwise included in the sale is leased, or not owned by Seller, or is subject to any maintenance or other ongoing financial obligation, or specifically subject to a lien or other encumbrance or loan, and (ii) Deliver to Buyer all written materials (such as lease, warranty, financing, etc.) concerning any such item.
(7) Seller represents that all items included in the purchase price, unless Otherwise Agreed, (i) are owned by Seller and shall be transferred free and clear of liens and encumbrances, except the items and systems identified pursuant to paragraph 9B(6), and (ii) are transferred without Seller warranty regardless of value. Seller shall cooperate with the identification of any software or applications and Buyer's efforts to transfer any services needed to operate any Smart Home Features or other items included in this Agreement, including, but not limited to, utilities or security systems. (8) A complete inventory of all personal property of Seller currently used in the operation of the Property and included in the purchase price shall be delivered to Buyer within the time specified in paragraph 3N(1). (9) Seller shall deliver title to the personal property by Bill of Sale, free of all liens and encumbrances, and without warranty of condition.
(10) As additional security for any note in favor of Seller for any part of the purchase price, Buyer shall execute a UCC-1 Financing Statement to be filed with the Secretary of State, covering the personal property included in the purchase, replacement thereof, and insurance proceeds.

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C. ITEMS EXCLUDED FROM SALE: Unless Otherwise Agreed, the following items are excluded from sale: (i) All items specified in paragraph 3P(2); (ii) audio and video components (such as flat screen TVs, speakers and other items) if any such item is not itself attached to the Property, even if a bracket or other mechanism attached to the component or item is attached to the Property; (iii) furniture and other items secured to the Property for earthquake or safety purposes. Unless otherwise specified in paragraph 3P(1), brackets attached to walls, floors or ceilings for any such component, furniture or item will be removed and holes or other damage shall be repaired, but not painted.

10. ALLOCATION OF COSTS:

A. INSPECTIONS, REPORTS, TESTS, AND CERTIFICATES: Paragraphs 3Q(1-3) and (5) only determines who is to pay for the inspection, report, test, certificate or service mentioned; it does not determine who is to pay for any work recommended or identified in any such document. Agreements for payment of required work should be specified elsewhere in paragraph 3Q, or 3S, or in a separate agreement (such as C.A.R. Forms RR, RRRR, ADM or AEA). Any reports in these paragraphs shall be Delivered in the time specified in Paragraph 3N(1).

B. GOVERNMENT REQUIREMENTS AND CORRECTIVE OR REMEDIAL ACTIONS:
(1) LEGALLY REQUIRED INSTALLATIONS AND PROPERTY IMPROVEMENTS: Any required installation of smoke alarm or carbon monoxide device(s) or securing of water heater shall be completed within the time specified in paragraph 3N(4). If Buyer is to pay for these items, Buyer, as instructed by Escrow Holder, shall deposit funds into escrow or directly to the vendor completing the repair or installation. Prior to Close Of Escrow, Seller shall Deliver to Buyer written statement(s) of compliance in accordance with any Law, unless Seller is exempt. If Seller is to pay for these items and does not fulfill Seller's obligation in the time specified, and Buyer incurs costs to comply with lender requirements concerning those items, Seller shall be responsible for Buyer's costs. (2) POINT OF SALE REQUIREMENTS:
(A) Point of sale inspections, reports and repairs refer to any such actions required to be completed before or after Close Of Escrow that are required in order to close under any Law. Unless Parties Otherwise Agree to another time period, any such repair, shall be completed prior to final verification of Property. If Buyer agrees to pay for any portion of such repair, Buyer, shall (i) directly pay to the vendor completing the repair or (ii) provide an invoice to Escrow Holder, deposit funds into escrow sufficient to pay for Buyer's portion of such repair and request Escrow Holder pay the vendor completing the repair.
(B) Buyer shall be provided, within the time specified in paragraph 3N(1), unless Parties Otherwise Agree to another time period, a Copy of any required government-conducted or point-of-sale inspection report prepared pursuant to this Agreement or in anticipation of this sale of the Property. (3) REINSPECTION FEES: If any repair in paragraph 10B(1) is not completed within the time specified and the lender requires an additional inspection to be made, Seller shall be responsible for any corresponding reinspection fee. If Buyer incurs costs to comply with lender requirements concerning those items, Seller shall be responsible for those costs. (4) INSTALLATION OF SAFETY FEATURES:
(A) The following installations shall be completed prior to final verification of condition unless Otherwise Agreed: (i) approved fire extinguisher(s), sprinkler(s), and hose(s), if required by law; and (ii) drain cover and anti-entrapment device or system meeting the minimum requirements permitted by the U.S. Consumer Products and Safety Commission for any pool or spa.
(B) If Buyer is to pay for these installations, Buyer, as instructed by Escrow Holder, shall deposit funds into escrow or directly to the vendor completing the installation.
(5) INFORMATION AND ADVICE ON REQUIREMENTS: Buyer and Seller are advised to seek information from a knowledgeable source regarding local and State mandates and whether they are point of sale requirements or requirements of ownership.

Agents do not have expertise in this area and cannot ascertain all of the requirements or costs of compliance.

11. SELLER DISCLOSURES
A. WITHHOLDING TAXES: Buyer and Seller hereby instruct Escrow Holder to withhold the applicable required amounts to comply with federal and California withholding Laws and forward such amounts to the Internal Revenue Service and Franchise Tax Board, respectively. However, no federal withholding is required if, prior to Close Of Escrow, Seller Delivers (i) to Buyer and Escrow Holder a fully completed affidavit (C.A.R. Form AS) sufficient to avoid withholding pursuant to federal withholding Law (FIRPTA); OR (ii) to a qualified substitute (usually a title company or an independent escrow company) a fully completed affidavit (C.A.R. Form AS) sufficient to avoid withholding pursuant to federal withholding Law AND the qualified substitute Delivers to Buyer and Escrow Holder an affidavit signed under penalty of perjury (C.A.R. Form QS) that the qualified substitute has received the fully completed Seller's affidavit and the Seller states that no federal withholding is required; OR (iii) to Buyer other documentation satisfying the requirements under Internal Revenue Code § 1445 (FIRPTA). No withholding is required under California Law if, prior to Close Of Escrow, Escrow Holder has received sufficient documentation from Seller that no withholding is required, and Buyer has been informed by Escrow Holder.

B. NOTICE REGARDING GAS AND HAZARDOUS LIQUID TRANSMISSION PIPELINES: This notice is being provided simply to inform you that information about the general location of gas and hazardous liquid transmission pipelines is available to the public via the National Pipeline Mapping System (NPMS) Internet Web site maintained by the United States Department of Transportation at http://www.npms.phmsa.dot.gov/. To seek further information about possible transmission pipelines near the Property, you may contact your local gas utility or other pipeline operators in the area. Contact information for pipeline operators is searchable by ZIP Code and county on the NPMS Internet Website. (Neither Seller nor Agent are required to check this website. If Buyer wants further information, Agent recommends that Buyer obtain information from this website during Buyer's investigation contingency period. Agents do not have expertise in this area.) C. CONDOMINIUM/PLANNED DEVELOPMENT DISCLOSURES:
(1) Seller shall, within the time specified in paragraph 3N(1), disclose to Buyer whether the Property is a condominium or is located in a planned development, other common interest development, or otherwise subject to covenants, conditions, and restrictions (C.A.R. Form CSPQ).
(2) If the Property is a condominium or is located in a planned development or other common interest development with a HOA, Seller shall, within the time specified in paragraph 3N(3), order from, and pay any required fee for the following items to the HOA (C.A.R. Form HOA-IR): (i) Copies of any documents required by Law (C.A.R. Form HOA-RS); (ii) disclosure of any pending or anticipated claim or litigation by or against the HOA; (iii) a statement containing the location and number of designated parking and storage spaces; (iv) Copies of the most recent 12 months of HOA minutes for regular and special meetings; (v) the names and contact information of all HOAs governing the Property; (vi) pet restrictions; and (vii) smoking restrictions (“CI Disclosures”). Seller shall itemize and Deliver to Buyer all CI Disclosures received from the HOA and any CI Disclosures in Seller's possession. Seller shall, as directed by Escrow Holder, deposit funds into escrow or direct to HOA or management company to pay for any of the above.

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D. SOLAR SYSTEMS: For properties with any solar panels or solar power systems, Seller shall, within the time specified in paragraph 3N(1), Deliver to Buyer all known information about the solar panels or solar system. Seller may use the Solar Advisory and Questionnaire (C.A.R. Form SOLAR).

E. NATURAL AND ENVIRONMENTAL HAZARDS: Seller shall, within the time specified in paragraph 3N(1), if required by Law:
(i) Deliver to Buyer the earthquake guide and environmental hazards booklet, and for all residential property with 1-4 units and any manufactured or mobile home built before January 1, 1960, fully complete and Deliver the Residential Earthquake Risk Disclosure Statement; and (ii) even if exempt from the obligation to provide a NHD, disclose if the Property is located in a Special Flood Hazard Area; Potential Flooding (Inundation) Area; Very High Fire Hazard Zone; State Fire Responsibility Area; Earthquake Fault Zone; Seismic Hazard Zone; and (iii) disclose any other zone as required by Law and provide any other information required for those zones.

F. WATER CONSERVING PLUMBING DEVICES: Civil Code § 1101.5 requires all multi-family residential and commercial real property be equipped with water-conserving plumbing devices. Seller shall, within the time specified in paragraph 3N(1), disclose in writing whether the property includes any noncompliant plumbing fixtures. Seller may use C.A.R. Form CSPQ. See C.A.R. Form WCMD for more information.

G. SURVEY, PLANS, AND ENGINEERING DOCUMENTS: Seller, within the time specified in paragraph 3N(1), shall provide to Buyer, Copies of surveys, plans, specifications, and engineering documents, if any, prepared on Seller's behalf on in Seller's possession.

H. PERMITS: Seller, within the time specified in paragraph 3N(1), shall provide to Buyer, if in Seller's possession, copies of all permits and approvals, certificates of occupancy, conditional use permits, development plans, and licenses and permits pertaining to the operation of the Property.

I. STRUCTURAL MODIFICATIONS: Seller, within the time specified in paragraph 3N(1), shall in writing disclose to Buyer, known structural additions or alterations to, or the installation, alteration, repair or replacement of, significant components of the structure(s) upon the Property.

J. GOVERNMENTAL COMPLIANCE: Within the time specified in paragraph 3N(1), (1) Seller shall disclose to Buyer any improvements, additions, alterations, or repairs to the Property made by Seller, or known to Seller to have been made, without required governmental permits, final inspections, and approvals (2) Seller shall disclose to Buyer if Seller has actual knowledge of any notice of violations of Law filed or issued against the Property.

K. VIOLATION NOTICES: Within the time specified in paragraph 3N(1), Seller shall disclose any notice of violations of any Law filed or issued against the Property and actually known to Seller L. KNOWN MATERIAL FACTS: Seller shall, within the time specified in paragraph 3N(1), DISCLOSE KNOWN MATERIAL FACTS AND DEFECTS affecting the Property, including, but not limited to, known insurance claims within the past five years, or provide Buyer with permission to contact insurer to get such information (C.A.R. Form ARC), and make any and all other disclosures required by Law.

M. COMMERCIAL SELLER PROPERTY QUESTIONNAIRE: Seller shall, within the time specified in paragraph 3N(1), complete and provide Buyer with a Commercial Seller Property Questionnaire (C.A.R. Form CSPQ).

N. SUBSEQUENT DISCLOSURES: In the event Seller, prior to Close Of Escrow, becomes aware of adverse conditions materially affecting the Property, or any material inaccuracy in disclosures, information, or representations previously provided to Buyer, Seller shall promptly Deliver a subsequent or amended disclosure or notice, in writing, covering those items. However, a subsequent or amended disclosure shall not be required for conditions and material inaccuracies of which Buyer is otherwise aware or which are disclosed in reports provided to or obtained by Buyer or ordered and paid for by Buyer.

12. TENANCY RELATED DISCLOSURES: Within the time specified in paragraph 3N(1), and subject to Buyer's right of review, Seller shall disclose, make available or Deliver, as applicable, to Buyer, the following information:

A. RENTAL/SERVICE AGREEMENTS: (i) All current leases, rental agreements, service contracts, and other agreements pertaining to the operation of the Property; (ii) A rental statement including names of tenants, rental rates, period or rental, date of last rent increase, security deposits, rental concessions, rebates or other benefits, if any, and a list of delinquent rents and their duration.

Seller represents that no tenant is entitled to any rebate, concession, or other benefit, except as set forth in these documents.

Seller represents that the documents to be furnished are those maintained in the ordinary and normal course of business.

B. INCOME AND EXPENSE STATEMENTS: If checked in paragraph 3R, the books and records for the Property, if any, including a statement of income and expense for the 12 months preceding Acceptance. Seller represents that the books and records are those maintained in the ordinary and normal course of business and used by Seller in the computation of federal and state income tax returns.

C. TENANT ESTOPPEL CERTIFICATES: If checked in paragraph 3R, Tenant Estoppel Certificates (C.A.R. Form TEC). Tenant Estoppel Certificates shall be completed by Seller or Seller's agent and delivered to tenant(s) for tenant(s) to sign and acknowledge: (i) that tenant(s)' rental or lease agreements are unmodified and in full force and effect, (or if modified, stating all such modifications); (ii) that no lessor defaults exist; and (iii) stating the amount of any prepaid rent or security deposit. Seller shall exercise good faith to obtain tenant(s)' signature(s), but Seller cannot guarantee tenant(s)' cooperation. In the event Seller cannot obtain signed Tenant Estoppel Certificates within the time specified above, Seller shall notify Buyer and provide the unsigned one that was provided to tenant(s). If, after the time specified for Seller to Deliver the TEC to Buyer, any tenant(s) sign and return a TEC to Seller, Seller shall Deliver that TEC to Buyer.

D. SELLER REPRESENTATIONS: Unless otherwise disclosed under paragraph 11, paragraph 12, or under any disclosure Delivered to Buyer:
(1) Seller represents that Seller has no actual knowledge that any tenant(s): (i) has any current pending lawsuit(s), investigation(s), Inquiry(ies), action(s), or other proceeding(s) affecting the Property of the right to use and occupy it; (ii) has any unsatisfied mechanics or materialman lien(s) affecting the Property; and (iii) is the subject of a bankruptcy. If Seller receives any such notice, prior to Close Of Escrow, Seller shall immediately notify Buyer. (2) Seller represents that no tenant is entitled to any rebate, concessions, or other benefit, except as set forth in the rental service agreements.
(3) Seller represents that the documents to be furnished are those maintained in the ordinary and normal course of business and the income and expense statements are and used by Seller in the computation of federal and state income tax returns.

13. CHANGES DURING ESCROW:

A. Prior to Close Of Escrow, Seller may engage in the following acts (“Proposed Changes”), subject to Buyer's rights in paragraph 13B: (i) rent or lease any vacant unit or other part of the premises; (ii) alter, modify, or extend any existing rental or lease agreement; (iii) enter into, alter, modify, or extend any service contract(s); or (iv) change the status of the condition of the Property.

B. (1) At least 7 Days prior to any Proposed Changes, Seller shall Deliver written notice to Buyer of such Proposed Change. (2) Within 5 Days after receipt of such notice, Buyer, in writing, may give Seller notice of Buyer's objection to the Proposed Changes in which case Seller shall not make the Proposed Changes.

CPA REVISED 12/22 (PAGE 8 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 8 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 16710 &16726 87
Property Address: Date:

14. SECURITY DEPOSITS AND UNEARNED RENT: Security deposits, if any, to the extent they have not been applied by Seller in accordance with any rental agreement and current Law, and all prepaid but unearned rents, if any, shall be transferred to Buyer on Close Of Escrow. Seller shall notify each tenant regarding the security deposit, in compliance with the California Civil Code.

15. BUYER'S INVESTIGATION OF PROPERTY AND MATTERS AFFECTING PROPERTY:

A. Buyer shall, within the time specified in paragraph 3L(3), have the right, at Buyer's expense unless Otherwise Agreed, to conduct inspections, investigations, tests, surveys and other studies (“Buyer Investigations”).

B. Buyer Investigations include, but are not limited to:
(1) Inspections regarding any physical attributes of the Property or items connected to the Property, such as:
(A) A general inspection.
(B) An inspection for lead-based paint and other lead-based paint hazards. (C) An inspection specifically for wood destroying pests and organisms. Any inspection for wood destroying pests and organisms shall be prepared by a registered Structural Pest Control company; shall cover the main building and attached structures; may cover detached structures; shall NOT include water tests of shower pans on upper level units unless the owners of property below the shower consent; shall NOT include roof coverings; and, if the Property is a unit in a condominium or other common interest subdivision, the inspection shall include only the separate interest and any exclusive-use areas being transferred, and shall NOT include common areas; and shall include a report (“Pest Control Report”) showing the findings of the company which shall be separated into sections for evident infestation or infections (Section 1) and for conditions likely to lead to infestation or infection (Section 2). (D) A phase one environmental survey, paid for and obtained by the party indicated in paragraph 3Q(2). If Buyer is responsible for obtaining and paying for the survey, Buyer shall act diligently and in good faith to obtain such survey within the time specified in paragraph 3L(3). Buyer has 5 Days after receiving the survey to remove this portion of the Buyer's Investigation contingency.
(2) Investigations of any other matter affecting the Property, other than those that are specified as separate contingencies.

Buyer Investigations include, but are not limited to, an investigation of the availability and cost of general homeowner's insurance, flood insurance, and fire insurance. See, Buyer's Investigation Advisory (C.A.R. Form BIA) for more.

C. Without Seller's prior written consent, Buyer shall neither make nor cause to be made: (i) invasive or destructive Buyer Investigations, except for minimally invasive testing required to prepare a Pest Control Report, which shall not include any holes or drilling through stucco or similar material; or (ii) inspections by any governmental building or zoning inspector or government employee, unless required by Law.

D. Seller shall make the Property available for all Buyer Investigations. Seller is not obligated to move any existing personal property.

Seller shall have water, gas, electricity and all operable pilot lights on for Buyer's Investigations and through the date possession is delivered to Buyer. Buyer shall, (i) by the time specified in paragraph 3L(3), complete Buyer Investigations and satisfy themselves as to the condition of the Property, and either remove the contingency or cancel this Agreement, and (ii) by the time specified in paragraph 3L(3) or 3 Days after receipt of any Investigation report, whichever is later, give Seller at no cost, complete Copies of all such reports obtained by Buyer, which obligation shall survive the termination of this Agreement. This Delivery of Investigation reports shall not include any appraisal, except an appraisal received in connection with an FHA or VA loan.

E. Buyer indemnity and Seller protection for entry upon the Property: Buyer shall: (i) keep the Property free and clear of liens; (ii) repair all damage arising from Buyer Investigations; and (iii) indemnify and hold Seller harmless from all resulting liability, claims, demands, damages and costs. Buyer shall carry, or Buyer shall require anyone acting on Buyer's behalf to carry, policies of liability, workers' compensation and other applicable insurance, defending and protecting Seller from liability for any injuries to persons or property occurring during any Buyer Investigations or work done on the Property at Buyer's direction prior to Close Of Escrow. Seller is advised that certain protections may be afforded Seller by recording a “Notice of Non-Responsibility” (C.A.R. Form NNR) for Buyer Investigations and work done on the Property at Buyer's direction. Buyer's obligations under this paragraph shall survive the termination of this Agreement.

16. TITLE AND VESTING:

A. Buyer shall, within the time specified in paragraph 3N(1), be provided a current Preliminary Report by the person responsible for paying for the title report in paragraph 3Q(8). If Buyer is responsible for paying, Buyer shall act diligently and in good faith to obtain such Preliminary Report within the time specified. The Preliminary Report is only an offer by the title insurer to issue a policy of title insurance and may not contain every item affecting title. The company providing the Preliminary Report shall, prior to issuing a Preliminary Report, conduct a search of the General Index for all Sellers except banks or other institutional lenders selling properties they acquired through foreclosure (REOs), corporations, and government entities.

B. Title is taken in its present condition subject to all encumbrances, easements, covenants, conditions, restrictions, rights and other matters, whether of record or not, as of the date of Acceptance except for: (i) monetary liens of record unless Buyer is assuming those obligations or taking the Property subject to those obligations; and (ii) those matters which Seller has agreed to remove in writing. For any lien or matter not being transferred upon sale, Seller will take necessary action to deliver title free and clear of such lien or matter.

C. Seller shall within 7 Days after request, give Escrow Holder necessary information to clear title.

D. Seller shall, within the time specified in paragraph 3N(1), disclose to Buyer all matters known to Seller affecting title, whether of record or not.

E. If Buyer is a legal entity and the Property purchase price is at least $300,000 and the purchase price is made without a bank loan or similar form of external financing, a Geographic Targeting Order (GTO) issued by the Financial Crimes Enforcement Network, U.S. Department of the Treasury, requires title companies to collect and report certain information about the Buyer, depending on where the Property is located. Buyer agrees to cooperate with the title company's effort to comply with the GTO.

F. Buyer shall, after Close Of Escrow, receive a recorded grant deed or any other conveyance document required to convey title (For example, for stock cooperative or tenancy in common, respectively, an assignment of stock certificate or assignment of seller's interest in the real property), including oil, mineral and water rights if currently owned by Seller. Title shall vest as designated in Buyer's vesting instructions. The recording document shall contain Buyer's post-closing mailing address to enable Buyer's receipt of the recorded conveyance document from the County Recorder. THE MANNER OF TAKING TITLE MAY HAVE SIGNIFICANT LEGAL AND TAX CONSEQUENCES. CONSULT AN APPROPRIATE PROFESSIONAL.

G. Buyer shall receive a Standard Coverage Owner's CLTA policy of title insurance. An ALTA policy or the addition of endorsements may provide greater coverage for Buyer. A title company, at Buyer's request, can provide information about the availability, desirability, coverage, and cost of various title insurance coverages and endorsements. If Buyer desires title coverage other than that required by this paragraph, Buyer shall instruct Escrow Holder in writing and shall pay any increase in cost.

CPA REVISED 12/22 (PAGE 9 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 9 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 16710 &16726
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17. TIME PERIODS; REMOVAL OF CONTINGENCIES; CANCELLATION RIGHTS: The following time periods may only be extended, altered, modified or changed by mutual written agreement. Any removal of contingencies or cancellation under this paragraph by either Buyer or Seller must be exercised in good faith and in writing (C.A.R. Form CR or CC).

A. SELLER DELIVERY OF DOCUMENTS: Seller shall, within the time specified in paragraph 3N(1), Deliver to Buyer all reports, disclosures and information ("Reports") for which Seller is responsible as specified in paragraphs 9B(6), 9B(8), 10, 11A, 11C-L, 12, 16A, 16D, and 35.

B. BUYER REVIEW OF DOCUMENTS; REPAIR REQUEST; CONTINGENCY REMOVAL OR CANCELLATION (1) Buyer has the time specified in paragraph 3 to perform Buyer Investigations; review all disclosures, Reports, lease documents to be assumed by Buyer pursuant to paragraph 9B(6), and other applicable information, which Buyer receives from Seller; and approve all matters affecting the Property. (2) Buyer may, within the time specified in paragraph 3L(3), request that Seller make repairs or take any other action regarding the Property (C.A.R. Form RR). Seller has no obligation to agree to or respond to Buyer's requests (C.A.R.

Form RR or RRRR). If Seller does not agree or does not respond, Buyer is not contractually entitled to have the repairs or other requests made and may only cancel based on contingencies in this Agreement. (3) Buyer shall, by the end of the times specified in paragraph 3L (or as Otherwise Agreed), Deliver to Seller a removal of the applicable contingency or cancellation of this Agreement (C.A.R. Form CR or CC). However, if any report, disclosure, or information for which Seller is responsible, is not Delivered within the time specified in paragraph 3N(1), then Buyer has 5 Days after Delivery of any such items, or the times specified in paragraph 3L, whichever is later, to Deliver to Seller a removal of the applicable contingency or cancellation of this Agreement. If Delivery of any Report occurs after a contractual contingency pertaining to that Report has already been waived or removed, the Delivery of the Report does not revive the contingency but there may be a right to terminate for a subsequent or amended disclosure under paragraph 11L. (4) Continuation of Contingency: Even after the end of the time specified in paragraph 3L and before Seller cancels, if at all, pursuant to paragraph 17C, Buyer retains the right, in writing, to either (i) remove remaining contingencies, or (ii) cancel this Agreement based on a remaining contingency. Once Buyer's written removal of all contingencies is Delivered to Seller, Seller may not cancel this Agreement pursuant to paragraph 17C(1).

C. SELLER RIGHT TO CANCEL:
(1) SELLER RIGHT TO CANCEL; BUYER CONTINGENCIES: If, by the time specified in this Agreement, Buyer does not Deliver to Seller a removal of the applicable contingency or cancellation of this Agreement, then Seller, after first Delivering to Buyer a Notice to Buyer to Perform (C.A.R. Form NBP), may cancel this Agreement. In such event, Seller shall authorize the return of Buyer's deposit, except for fees incurred by Buyer. (2) SELLER RIGHT TO CANCEL; BUYER CONTRACT OBLIGATIONS: Seller, after first Delivering to Buyer a Notice to Buyer to Perform, may cancel this Agreement if, by the time specified in this Agreement, Buyer does not take the following action(s): (i) Deposit funds as required by paragraph 3D(1) or 3D(2) or if the funds deposited pursuant to paragraph 3D(1) or 3D(2) are not good when deposited; (ii) Deliver updated contact information for Buyer's lender(s) as required by paragraph 5C(3); (iii) Deliver a notice of FHA or VA costs or terms, if any, as specified by paragraph 5C(5) (C.A.R. Form RR); (iv) Deliver verification, or a satisfactory verification if Seller reasonably disapproves of the verification already provided, as required by paragraph 5B or 6A; (v) Deliver a letter as required by paragraph 6B; (vi) In writing assume or accept leases or liens specified in paragraph 8G; (vii) Cooperate with the title company's effort to comply with the GTO as required by paragraph 16E; (viii) Sign or initial a separate liquidated damages form for an increased deposit as required by paragraph 5A(2) and 36; (ix) Provide evidence of authority to Sign in a representative capacity as specified in paragraph 35; or (x) Perform any additional Buyer contractual obligation(s) included in this Agreement. In such event, Seller shall authorize the return of Buyer's deposit, except for fees allocated to Seller in this Agreement and already paid by Escrow prior to cancellation of this Agreement and notification to Escrow. (3) SELLER RIGHT TO CANCEL; SELLER CONTINGENCIES: Seller may cancel this Agreement by good faith exercise of any Seller contingency included in this Agreement, or Otherwise Agreed, so long as that contingency has not already been removed or waived in writing.

D. BUYER RIGHT TO CANCEL:
(1) BUYER RIGHT TO CANCEL; SELLER CONTINGENCIES: If, by the time specified in this Agreement, Seller does not Deliver to Buyer a removal of the applicable contingency or cancellation of this Agreement, then Buyer, after first Delivering to Seller a Notice to Seller to Perform (C.A.R. Form NSP), may cancel this Agreement. In such event, Seller shall authorize the return of Buyer's deposit, except for fees allocated to Seller in the Agreement and already paid by Escrow prior to cancellation of this Agreement and notification to Escrow. (2) BUYER RIGHT TO CANCEL; SELLER CONTRACT OBLIGATIONS: If, by the time specified, Seller has not Delivered any item specified in paragraph 3N(1) or Seller has not performed any Seller contractual obligation included in this Agreement by the time specified, Buyer, after first Delivering to Seller a Notice to Seller to Perform, may cancel this Agreement. (3) BUYER RIGHT TO CANCEL; BUYER CONTINGENCIES: Buyer may cancel this Agreement by good faith exercise of any Buyer contingency included in paragraph 8, or Otherwise Agreed, so long as that contingency has not already been removed in writing.

E. NOTICE TO BUYER OR SELLER TO PERFORM: The Notice to Buyer to Perform or Notice to Seller to Perform shall: (i) be in writing; (ii) be Signed by the applicable Buyer or Seller; and (iii) give the other Party at least 2 Days after Delivery (or until the time specified in the applicable paragraph, whichever occurs last) to take the applicable action. A Notice to Buyer to Perform or Notice to Seller to Perform may not be Delivered any earlier than 2 Days prior to the Scheduled Performance Day to remove a contingency or cancel this Agreement or meet an obligation specified in paragraph 17, whether or not the Scheduled Performance Day falls on a Saturday, Sunday or legal holiday. If a Notice to Buyer to Perform or Notice to Seller to Perform is incorrectly Delivered or specifies a time less than the agreed time, the notice shall be deemed invalid and void and Seller or Buyer shall be required to Deliver a new Notice to Buyer to Perform or Notice to Seller to Perform with the specified timeframe.

F. EFFECT OF REMOVAL OF CONTINGENCIES:
(1) REMOVAL OF BUYER CONTINGENCIES: If Buyer removes any contingency or cancellation rights, unless Otherwise Agreed, Buyer shall conclusively be deemed to have: (i) completed all Buyer Investigations, and review of Reports and other applicable information and disclosures pertaining to that contingency or cancellation right; (ii) elected to proceed with the transaction; and (iii) assumed all liability, responsibility and expense for the non-delivery of any Reports, disclosures or information outside of Seller's control and for any Repairs or corrections pertaining to that contingency or cancellation right, or for the inability to obtain financing. (2) REMOVAL OF SELLER CONTINGENCIES: If Seller removes any contingency or cancellation rights, unless Otherwise Agreed, Seller shall conclusively be deemed to have: (i) satisfied themselves regarding such contingency, (ii) elected to proceed with the transaction; and (iii) given up any right to cancel this Agreement based on such contingency.

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Property Address: Date:

G. DEMAND TO CLOSE ESCROW: Before Buyer or Seller may cancel this Agreement for failure of the other Party to close escrow pursuant to this Agreement, Buyer or Seller must first Deliver to the other Party a Demand to Close Escrow (C.A.R.

Form DCE). The DCE shall: (i) be Signed by the applicable Buyer or Seller; and (ii) give the other Party at least 3 Days after Delivery to close escrow. A DCE may not be Delivered any earlier than 3 Days prior to the Scheduled Performance Day for the Close Of Escrow. If a DCE is incorrectly Delivered or specifies a time less than the agreed time, the DCE shall be deemed invalid and void and Seller or Buyer shall be required to Deliver a new DCE.

H. EFFECT OF CANCELLATION ON DEPOSITS: If Buyer or Seller gives written notice of cancellation pursuant to rights duly exercised under the terms of this Agreement, the Parties agree to Sign and Deliver mutual instructions to cancel the sale and escrow and release deposits, if any, to the Party entitled to the funds, less (i) fees and costs paid by Escrow Holder on behalf of that Party, if required by this Agreement; and (ii) any escrow fee charged to that party. Fees and costs may be payable to service providers and vendors for services and products provided during escrow. A release of funds will require mutual Signed release instructions from the Parties, judicial decision or arbitration award. A Party may be subject to a civil penalty of up to $1,000 for refusal to Sign cancellation instructions if no good faith dispute exists as to which Party is entitled to the deposited funds (Civil Code § 1057.3). Note: Neither Agents nor Escrow Holder are qualified to provide any opinion on whether either Party has acted in good faith or which Party is entitled to the deposited funds. Buyer and Seller are advised to seek the advice of a qualified California real estate attorney regarding this matter.

18. REPAIRS: Repairs shall be completed prior to final verification of condition unless Otherwise Agreed. Repairs to be performed at Seller's expense may be performed by Seller or through others, provided that the work complies with applicable Law, including governmental permit, inspection and approval requirements. Repairs shall be performed in a good, skillful manner with materials of quality and appearance comparable to existing materials. Buyer acknowledges that exact restoration of appearance or cosmetic items following all Repairs may not be possible. Seller shall: (i) obtain invoices and paid receipts for Repairs performed by others; (ii) prepare a written statement indicating the Repairs performed by Seller and the date of such Repairs; and (iii) provide Copies of invoices and paid receipts and statements to Buyer prior to final verification of condition.

19. FINAL VERIFICATION OF CONDITION: Buyer shall have the right to make a final verification of the Property condition within the time specified in paragraph 3J, NOT AS A CONTINGENCY OF THE SALE, but solely to confirm: (i) the Property is maintained pursuant to paragraph 7B; (ii) Repairs have been completed as agreed; and (iii) Seller has complied with Seller's other obligations under this Agreement (C.A.R. Form VP).

20. PRORATIONS OF PROPERTY TAXES AND OTHER ITEMS: Unless Otherwise Agreed, the following items shall be PAID CURRENT and prorated between Buyer and Seller as of Close Of Escrow: real property taxes and assessments, interest, Seller rental payments, HOA regular assessments due prior to Close Of Escrow, premiums on insurance assumed by Buyer, payments on bonds and assessments assumed by Buyer, and payments on Mello-Roos and other Special Assessment District bonds and assessments that are now a lien. Seller shall pay any HOA special or emergency assessments due prior to Close Of Escrow. The following items shall be assumed by Buyer WITHOUT CREDIT toward the purchase price: prorated payments on Mello-Roos and other Special Assessment District bonds and assessments and HOA special or emergency assessments that are due after Close Of Escrow. Property will be reassessed upon change of ownership. Any supplemental tax bills delivered to Escrow Holder prior to closing shall be prorated and paid as follows: (i) for periods after Close Of Escrow, by Buyer; and (ii) for periods prior to Close Of Escrow, by Seller (see C.A.R. Form SPT or SBSA for further information). Seller agrees all service fees, maintenance costs and utility bills will be paid current up and through the date of Close Of Escrow. TAX BILLS AND UTILITY BILLS ISSUED AFTER CLOSE OF ESCROW SHALL BE HANDLED DIRECTLY BETWEEN BUYER AND SELLER. Prorations shall be made based on a 30-day month.

21. BROKERS AND AGENTS:

A. COMPENSATION: Seller or Buyer, or both, as applicable, agree to pay compensation to Broker as specified in a separate written agreement between Broker and that Seller or Buyer. Compensation is payable upon Close Of Escrow, or if escrow does not close, as otherwise specified in the agreement between Broker and that Seller or Buyer. If Seller agrees to pay Buyer's Broker (see paragraph 3G(3)), Seller shall be entitled to a copy of the portion of the written compensation agreement between Buyer and Buyer's Broker identifying the compensation to be paid. See C.A.R. Form SPBB for further information.

B. SCOPE OF DUTY: Buyer and Seller acknowledge and agree that Agent: (i) Does not decide what price Buyer should pay or Seller should accept; (ii) Does not guarantee the condition of the Property; (iii) Does not guarantee the performance, adequacy or completeness of inspections, services, products or repairs provided or made by Seller or others; (iv) Does not have an obligation to conduct an inspection of common areas or areas off the site of the Property; (v) Shall not be responsible for identifying defects on the Property, in common areas, or offsite unless such defects are visually observable by an inspection of reasonably accessible areas of the Property or are known to Agent; (vi) Shall not be responsible for inspecting public records or permits concerning the title or use of Property; (vii) Shall not be responsible for identifying the location of boundary lines or other items affecting title; (viii) Shall not be responsible for verifying square footage, representations of others or information contained in Investigation reports, Multiple Listing Service, advertisements, flyers or other promotional material; (ix) Shall not be responsible for determining the fair market value of the Property or any personal property included in the sale; (x) Shall not be responsible for providing legal or tax advice regarding any aspect of a transaction entered into by Buyer or Seller; and (xi) Shall not be responsible for providing other advice or information that exceeds the knowledge, education and experience required to perform real estate licensed activity.

Buyer and Seller agree to seek legal, tax, insurance, title and other desired assistance from appropriate professionals.

C. BROKERAGE: Neither Buyer nor Seller has utilized the services of, or for any other reason owes compensation to, a licensed real estate broker (individual or corporate), agent, finder, or other entity, other than as specified in this Agreement, in connection with any act relating to the Property, including, but not limited to, inquiries, introductions, consultations, and negotiations leading to this Agreement. Buyer and Seller each agree to indemnify and hold the other, the Brokers specified herein and their agents, harmless from and against any costs, expenses or liability for compensation claimed inconsistent with the warranty and representation in this paragraph.

22. JOINT ESCROW INSTRUCTIONS TO ESCROW HOLDER:

A. The following paragraphs, or applicable portions thereof, of this Agreement constitute the joint escrow instructions of Buyer and Seller to Escrow Holder, which Escrow Holder is to use along with any related counter offers and addenda, and any additional mutual instructions to close the escrow: paragraphs 1, 3A, 3B, 3D-G, 3N(2), 3Q, 3S, 4A, 4B, 5A(1-2) 5D, 5E, 10B(2)(A), 10B(3), 11A, 11C(2), 16 (except 16D), 17H, 20, 21A, 22, 26, 32, 33, 34, 35, 39, 40, and paragraph 3 of the Real Estate Brokers Section. If a Copy of the separate compensation agreement(s) provided for in paragraph 21A or paragraph 3 of the Real Estate Brokers Section is deposited with Escrow Holder by Agent, Escrow Holder shall accept such agreement(s) and pay out from Buyer's or Seller's funds, or both, as applicable, the Broker's compensation provided for in such agreement(s). The terms and conditions of this Agreement not set forth in the specified paragraphs are additional matters for the information of Escrow Holder, but about which Escrow Holder need not be concerned.

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Property Address: Date:

B. Buyer and Seller will receive Escrow Holder's general provisions, if any, directly from Escrow Holder. To the extent the general provisions are inconsistent or conflict with this Agreement, the general provisions will control as to the duties and obligations of Escrow Holder only. Buyer and Seller shall Sign and return Escrow Holder's general provisions or supplemental instructions within the time specified in paragraph 3N(2). Buyer and Seller shall execute additional instructions, documents and forms provided by Escrow Holder that are reasonably necessary to close the escrow and, as directed by Escrow Holder, within 3 Days, shall pay to Escrow Holder or HOA or HOA management company or others any fee required by paragraphs 3, 8, 10, 11, or elsewhere in this Agreement.

C. A Copy of this Agreement including any counter offer(s) and addenda shall be delivered to Escrow Holder within 3 Days after Acceptance. Buyer and Seller authorize Escrow Holder to accept and rely on Copies and Signatures as defined in this Agreement as originals, to open escrow and for other purposes of escrow. The validity of this Agreement as between Buyer and Seller is not affected by whether or when Escrow Holder Signs this Agreement. Escrow Holder shall provide Seller's Statement of Information to Title Company when received from Seller, if a separate company is providing title insurance. If Seller delivers an affidavit to Escrow Holder to satisfy Seller's FIRPTA obligation under paragraph 11A, Escrow Holder shall deliver to Buyer, Buyer's Agent, and Seller's Agent a Qualified Substitute statement that complies with federal Law. If Escrow Holder's Qualified Substitute statement does not comply with federal law, the Parties instruct escrow to withhold all applicable required amounts under paragraph 11A.

D. Agents are not a party to the escrow except for the sole purpose of receiving compensation pursuant to paragraph 21A and paragraph 3 of the Real Estate Brokers Section. If a Copy of the separate compensation agreement(s) provided for in either of those paragraphs is deposited with Escrow Holder by Agent, Escrow Holder shall accept such agreement(s) and pay out from Buyer's or Seller's funds, or both, as applicable, the Broker's compensation provided for in such agreement(s). Buyer and Seller irrevocably assign to Brokers compensation specified in paragraph 21A, and irrevocably instruct Escrow Holder to disburse those funds to Brokers at Close Of Escrow or pursuant to any other mutually executed cancellation agreement.

Compensation instructions can be amended or revoked only with the written consent of Brokers. Buyer and Seller shall release and hold harmless Escrow Holder from any liability resulting from Escrow Holder's payment to Broker(s) of compensation pursuant to this Agreement.

E. Buyer and Seller acknowledge that Escrow Holder may require invoices for expenses under this Agreement. Buyer and Seller, upon request by Escrow Holder, within 3 Days or within a sufficient time to close escrow, whichever is sooner, shall provide any such invoices to Escrow Holder.

F. Upon receipt, Escrow Holder shall provide Buyer, Seller, and each Agent verification of Buyer's deposit of funds pursuant to paragraph 5A(1) and 5A(2). Once Escrow Holder becomes aware of any of the following, Escrow Holder shall immediately notify each Agent: (i) if Buyer's initial or any additional deposit or down payment is not made pursuant to this Agreement, or is not good at time of deposit with Escrow Holder; or (ii) if Buyer and Seller instruct Escrow Holder to cancel escrow.

G. A Copy of any amendment that affects any paragraph of this Agreement for which Escrow Holder is responsible shall be delivered to Escrow Holder within 3 Days after mutual execution of the amendment.

23. SELECTION OF SERVICE PROVIDERS: Agents do not guarantee the performance of any vendors, service or product providers (“Providers”), whether referred by Agent or selected by Buyer, Seller or other person. Buyer and Seller may select ANY Providers of their own choosing.

24. MULTIPLE LISTING SERVICE (“MLS”): Agents are authorized to report to the MLS that an offer has been accepted and, upon Close Of Escrow, the sales price and other terms of this transaction shall be provided to the MLS to be published and disseminated to persons and entities authorized to use the information on terms approved by the MLS. Buyer acknowledges that: (i) any pictures, videos, floor plans (collectively, “Images”) or other information about the Property that has been or will be inputted into the MLS or internet portals, or both, at the instruction of Seller or in compliance with MLS rules, will not be removed after Close Of Escrow; (ii) California Civil Code § 1088(c) requires the MLS to maintain such Images and information for at least three years and as a result they may be displayed or circulated on the Internet, which cannot be controlled or removed by Seller or Agents; and (iii) Seller, Seller's Agent, Buyer's Agent, and MLS have no obligation or ability to remove such Images or information from the Internet.

25. ATTORNEY FEES AND COSTS: In any action, proceeding, or arbitration between Buyer and Seller arising out of this Agreement, the prevailing Buyer or Seller shall be entitled to reasonable attorney fees and costs from the non-prevailing Buyer or Seller, except as provided in paragraph 37A.

26. ASSIGNMENT/NOMINATION: Buyer shall have the right to assign all of Buyer's interest in this Agreement to Buyer's own trust or to any wholly owned entity of Buyer that is in existence at the time of such assignment. Otherwise, Buyer shall not assign all or any part of Buyer's interest in this Agreement without first having obtained the separate written consent of Seller to a specified assignee. Such consent shall not be unreasonably withheld. Prior to any assignment, Buyer shall disclose to Seller the name of the assignee and the amount of any monetary consideration between Buyer and assignee. Buyer shall provide assignee with all documents related to this Agreement including, but not limited to, the Agreement and any disclosures. If assignee is a wholly owned entity or trust of Buyer, that assignee does not need to re-sign or initial all documents provided. Whether or not an assignment requires seller's consent, at the time of assignment, assignee shall deliver a letter from assignee's lender that assignee is prequalified or preapproved as specified in paragraph 6B. Should assignee fail to deliver such a letter, Seller, after first giving Assignee an Notice to Buyer to Perform, shall have the right to terminate the assignment. Buyer shall, within the time specified in paragraph 3K, Deliver any request to assign this Agreement for Seller's consent. If Buyer fails to provide the required information within this time frame, Seller's withholding of consent shall be deemed reasonable. Any total or partial assignment shall not relieve Buyer of Buyer's obligations pursuant to this Agreement unless Otherwise Agreed by Seller (C.A.R. Form AOAA). Parties shall provide any assignment agreement to Escrow Holder within 1 Day after the assignment. Any nomination by Buyer shall be subject to the same procedures, requirements, and terms as an assignment as specified in this paragraph.

27. SUCCESSORS AND ASSIGNS: This Agreement shall be binding upon, and inure to the benefit of, Buyer and Seller and their respective successors and assigns, except as otherwise provided herein.

28. ENVIRONMENTAL HAZARD CONSULTATION: Buyer and Seller acknowledge: (i) Federal, state, and local legislation impose liability upon existing and former owners and users of real property, in applicable situations, for certain legislatively defined, environmentally hazardous substances; (ii) Agent(s) has/have made no representation concerning the applicability of any such Law to this transaction or to Buyer or to Seller, except as otherwise indicated in this Agreement; (iii) Agent(s) has/have made no representation concerning the existence, testing, discovery, location, and evaluation of/for, and risks posed by, environmentally hazardous substances, if any, located on or potentially affecting the Property; and (iv) Buyer and Seller are each advised to consult with technical and legal experts concerning the existence, testing, discover, location and evaluation of/for, and risks posed by, environmentally hazardous substances, in any, located on or potentially affecting the Property.

CPA REVISED 12/22 (PAGE 12 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 12 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 16710 &16726 91
Property Address: Date:

29. AMERICANS WITH DISABILITIES ACT: The Americans With Disabilities Act (“ADA”) prohibits discrimination against individuals with disabilities. The ADA affects almost all commercial facilities and public accommodations. Residential properties are not typically covered by the ADA, but may be governed by its provisions if used for certain purposes. The ADA can require, among other things, that building be made readily accessible to the disabled. Different requirements apply to new construction, alterations to existing buildings, and removal of barriers in existing buildings. Compliance with the ADA may require significant costs. Monetary and injunctive remedies may be incurred if the Property is not in compliance. A real estate broker or agent does not have the technical expertise to determine whether a building is in compliance with ADA requirements, or to advise a principal on those requirements. Buyer and Seller are advised to contact a qualified California real estate attorney, contractor, architect, engineer, or other qualified professional of Buyer or Seller's own choosing to determine to what degree, if any, the ADA impacts that principal or this transaction.

30. EQUAL HOUSING OPPORTUNITY: The Property is sold in compliance with federal, state and local anti-discrimination Laws.

31. COPIES: Seller and buyer each represent that Copies of all reports, certificates, approvals, and other documents that are furnished to the other are true, correct, and unaltered Copies of the original documents, if the originals are in the possession of the furnishing party.

32. DEFINITIONS and INSTRUCTIONS: The following words are defined terms in this Agreement, shall be indicated by initial capital letters throughout this Agreement, and have the following meaning whenever used:

A. “Acceptance” means the time the offer or final counter offer is fully executed, in writing, by the recipient Party and is Delivered to the offering Party or that Party's Authorized Agent.

B. “Agent” means the Broker, salesperson, broker-associate or any other real estate licensee licensed under the brokerage firm identified in paragraph 2B.

C. “Agreement” means this document and any counter offers and any incorporated addenda or amendments, collectively forming the binding agreement between the Parties. Addenda and amendments are incorporated only when Signed and Delivered by all Parties.

D. “As-Is” condition: Seller shall disclose known material facts and defects as specified in this Agreement. Buyer has the right to inspect the Property and, within the time specified, request that Seller make repairs or take other corrective action, or exercise any contingency cancellation rights in this Agreement. Seller is only required to make repairs specified in this Agreement or as Otherwise Agreed.

E. “Authorized Agent” means an individual real estate licensee specified in the Real Estate Broker Section.

F. “C.A.R. Form” means the most current version of the specific form referenced or another comparable form agreed to by the Parties.

G. “Close Of Escrow”, including “COE”, means the date the grant deed, or other evidence of transfer of title, is recorded for any real property, or the date of Delivery of a document evidencing the transfer of title for any non-real property transaction.

H. “Copy” means copy by any means including photocopy, facsimile and electronic.

I. Counting Days is done as follows unless Otherwise Agreed: (1) The first Day after an event is the first full calendar date following the event, and ending at 11:59 pm. For example, if a Notice to Buyer to Perform (C.A.R. form NBP) is Delivered at 3 pm on the 7th calendar day of the month, or Acceptance of a counter offer is personally received at 12 noon on the 7th calendar day of the month, then the 7th is Day “0” for purposes of counting days to respond to the NBP or calculating the Close Of Escrow date or contingency removal dates and the 8th of the month is Day 1 for those same purposes. (2) All calendar days are counted in establishing the first Day after an event. (3) All calendar days are counted in determining the date upon which performance must be completed, ending at 11:59 pm on the last day for performance (“Scheduled Performance Day”). (4) After Acceptance, if the Scheduled Performance Day for any act required by this Agreement, including Close Of Escrow, lands on a Saturday, Sunday, or Legal Holiday, the performing party shall be allowed to perform on the next day that is not a Saturday, Sunday or Legal Holiday (“Allowable Performance Day”), and ending at 11:59 pm. “Legal Holiday” shall mean any holiday or optional bank holiday under Civil Code §§ 7 and 7.1 and any holiday under Government Code § 6700. (5) For the purposes of COE, any day that the Recorder's office in the County where the Property is located is closed or any day that the lender or Escrow Holder under this Agreement is closed, the COE shall occur on the next day the Recorder's office in that County, the lender, and the Escrow Holder are open. (6) COE is considered Day 0 for purposes of counting days Seller is allowed to remain in possession, if permitted by this Agreement.

J. “Day" or "Days” means calendar day or days. However, delivery of deposit to escrow is based on business days.

K. “Deliver”, “Delivered” or “Delivery” of documents, unless Otherwise Agreed, means and shall be effective upon personal receipt of the document by Buyer or Seller or their Authorized Agent. Personal receipt means (i) a Copy of the document, or as applicable, link to the document, is in the possession of the Party or Authorized Agent, regardless of the Delivery method used (i.e. e-mail, text, other), or (ii) an electronic Copy of the document, or as applicable, link to the document, has been sent to any of the designated electronic delivery addresses specified in the Real Estate Broker Section on page 16. After Acceptance, Agent may change the designated electronic delivery address for that Agent by, in writing, Delivering notice of the change in designated electronic delivery address to the other Party. Links could be, for example, to DropBox or GoogleDrive or other functionally equivalent program. If the recipient of a link is unable or unwilling to open the link or download the documents or otherwise prefers Delivery of the documents directly, Recipient of a link shall notify the sender in writing, within 3 Days after Delivery of the link (C.A.R. Form RFR). In such case, Delivery shall be effective upon Delivery of the documents and not the link. Failure to notify sender within the time specified above shall be deemed consent to receive, and Buyer opening, the document by link.

L. “Electronic Copy” or “Electronic Signature” means, as applicable, an electronic copy or signature complying with California Law. Unless Otherwise Agreed, Buyer and Seller agreed to the use of Electronic Signatures. Buyer and Seller agree that electronic means will not be used by either Party to modify or alter the content or integrity of this Agreement without the knowledge and consent of the other Party.

M. “Law” means any law, code, statute, ordinance, regulation, rule or order, which is adopted by a controlling city, county, state or federal legislative, judicial or executive body or agency.

N. "Legally Authorized Signer" means an individual who has authority to Sign for the principal as specified in paragraph 39 or paragraph 40.

O. “Otherwise Agreed” means an agreement in writing, signed by both Parties and Delivered to each.

P. “Repairs” means any repairs (including pest control), alterations, replacements, modifications or retrofitting of the Property provided for under this Agreement.

Q. "Sign" or “Signed” means either a handwritten or Electronic Signature on an original document, Copy or any counterpart.

CPA REVISED 12/22 (PAGE 13 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 13 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 16710 &16726 92
Property Address: Date:

33. TERMS AND CONDITIONS OF OFFER: This is an offer to purchase the Property on the terms and conditions herein. The individual Liquidated Damages and Arbitration of Disputes paragraphs are incorporated in this Agreement if initialed by all Parties or if incorporated by mutual agreement in a Counter Offer or addendum. If at least one but not all Parties initial, a Counter Offer is required until agreement is reached. Seller has the right to continue to offer the Property for sale and to accept any other offer at any time prior to notification of Acceptance and to market the Property for backup offers after Acceptance. The Parties have read and acknowledge receipt of a Copy of the offer and agree to the confirmation of agency relationships. If this offer is accepted and Buyer subsequently defaults, Buyer may be responsible for payment of Brokers' compensation. This Agreement and any supplement, addendum or modification, including any Copy, may be Signed in two or more counterparts, all of which shall constitute one and the same writing. By signing this offer or any document in the transaction, the Party Signing the document is deemed to have read the document in its entirety.

34. TIME OF ESSENCE; ENTIRE CONTRACT; CHANGES: Time is of the essence. All understandings between the Parties are incorporated in this Agreement. Its terms are intended by the Parties as a final, complete and exclusive expression of their Agreement with respect to its subject matter and may not be contradicted by evidence of any prior agreement or contemporaneous oral agreement. If any provision of this Agreement is held to be ineffective or invalid, the remaining provisions will nevertheless be given full force and effect. Except as Otherwise Agreed, this Agreement shall be interpreted, and disputes shall be resolved in accordance with the Laws of the State of California. Neither this Agreement nor any provision in it may be extended, amended, modified, altered or changed, except in writing Signed by Buyer and Seller.

35. LEGALLY AUTHORIZED SIGNER: Wherever the signature or initials of the Legally Authorized Signer identified in paragraph 39 or 40 appear on this Agreement or any related documents, it shall be deemed to be in a representative capacity for the entity described and not in an individual capacity, unless otherwise indicated. The Legally Authorized Signer (i) represents that the entity for which that person is acting already exists and is in good standing to do business in California and (ii) shall Deliver to the other Party and Escrow Holder, within as specified in paragraph 3N(5), evidence of authority to act in that capacity (such as but not limited to: applicable portion of the trust or Certification Of Trust (Probate Code § 18100.5), letters testamentary, court order, power of attorney, corporate resolution, or formation documents of the business entity).

CPA REVISED 12/22 (PAGE 14 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 14 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 16710 &16726 93
Property Address: Date:

36. LIQUIDATED DAMAGES:

If Buyer fails to complete this purchase because of Buyer's default, Seller shall retain, as liquidated damages, the deposit actually paid. Buyer and Seller agree that this amount is a reasonable sum given that it is impractical or extremely difficult to establish the amount of damages that would actually be suffered by Seller in the event Buyer were to breach this Agreement. Release of funds will require mutual, Signed release instructions from both Buyer and Seller, judicial decision or arbitration award. AT THE TIME OF ANY

INCREASED DEPOSIT BUYER AND SELLER SHALL SIGN A SEPARATE LIQUIDATED DAMAGES PROVISION INCORPORATING THE INCREASED DEPOSIT AS LIQUIDATED DAMAGES (C.A.R. FORM DID).

Buyer's Initials / Seller's Initials /

37. MEDIATION:

A. The Parties agree to mediate any dispute or claim arising between them out of this Agreement, or any resulting transaction, before resorting to arbitration or court action. The mediation shall be conducted through the C.A.R. Real Estate Mediation Center for Consumers (www.consumermediation.org) or through any other mediation provider or service mutually agreed to by the Parties. The Parties also agree to mediate any disputes or claims with Agents(s), who, in writing, agree to such mediation prior to, or within a reasonable time after, the dispute or claim is presented to the Agent. Mediation fees, if any, shall be divided equally among the Parties involved, and shall be recoverable under the prevailing party attorney fees clause. If, for any dispute or claim to which this paragraph applies, any Party (i) commences an action without first attempting to resolve the matter through mediation, or (ii) before commencement of an action, refuses to mediate after a request has been made, then that Party shall not be entitled to recover attorney fees, even if they would otherwise be available to that Party in any such action. THIS MEDIATION PROVISION APPLIES WHETHER OR NOT THE ARBITRATION PROVISION IS INITIALED.

B. ADDITIONAL MEDIATION TERMS: (i) Exclusions from this mediation agreement are specified in paragraph 38B; (ii) The obligation to mediate does not preclude the right of either Party to seek a preservation of rights under paragraph 38C; and (iii) Agent's rights and obligations are further specified in paragraph 38D. These terms apply even if the Arbitration of Disputes paragraph is not initialed.

38. ARBITRATION OF DISPUTES:

A. The Parties agree that any dispute or claim in Law or equity arising between them out of this Agreement or any resulting transaction, which is not settled through mediation, shall be decided by neutral, binding arbitration. The Parties also agree to arbitrate any disputes or claims with Agents(s), who, in writing, agree to such arbitration prior to, or within a reasonable time after, the dispute or claim is presented to the Agent. The arbitration shall be conducted through any arbitration provider or service mutually agreed to by the Parties. The arbitrator shall be a retired judge or justice, or an attorney with at least 5 years of transactional real estate Law experience, unless the Parties mutually agree to a different arbitrator. Enforcement of, and any motion to compel arbitration pursuant to, this agreement to arbitrate shall be governed by the procedural rules of the Federal Arbitration Act, and not the California Arbitration Act, notwithstanding any language seemingly to the contrary in this Agreement. The Parties shall have the right to discovery in accordance with Code of Civil Procedure § 1283.05. The arbitration shall be conducted in accordance with Title 9 of Part 3 of the Code of Civil Procedure. Judgment upon the award of the arbitrator(s) may be entered into any court having jurisdiction.

B. EXCLUSIONS: The following matters are excluded from mediation and arbitration: (i) Any matter that is within the jurisdiction of a probate, small claims or bankruptcy court; (ii) an unlawful detainer action; and (iii) a judicial or nonjudicial foreclosure or other action or proceeding to enforce a deed of trust, mortgage or installment land sale contract as defined in Civil Code § 2985.

C. PRESERVATION OF ACTIONS: The following shall not constitute a waiver nor violation of the mediation and arbitration provisions: (i) the filing of a court action to preserve a statute of limitations; (ii) the filing of a court action to enable the recording of a notice of pending action, for order of attachment, receivership, injunction, or other provisional remedies, provided the filing party concurrent with, or immediately after such filing, makes a request to the court for a stay of litigation pending any applicable mediation or arbitration proceeding; or (iii) the filing of a mechanic's lien.

D. AGENTS: Agents shall not be obligated nor compelled to mediate or arbitrate unless they agree to do so in writing.

Any Agents(s) participating in mediation or arbitration shall not be deemed a party to this Agreement.

E. “NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE AGREEING TO HAVE ANY DISPUTE ARISING

OUT OF THE MATTERS INCLUDED IN THE 'ARBITRATION OF DISPUTES' PROVISION DECIDED BY

NEUTRAL ARBITRATION AS PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY INITIALING

IN THE SPACE BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO DISCOVERY AND APPEAL,

UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE 'ARBITRATION OF DISPUTES' PROVISION. IF YOU REFUSE TO SUBMIT TO ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU

MAY BE COMPELLED TO ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE. YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.” “WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE TO SUBMIT DISPUTES ARISING

OUT OF THE MATTERS INCLUDED IN THE 'ARBITRATION OF DISPUTES' PROVISION TO NEUTRAL ARBITRATION.”
Buyer's Initials / Seller's Initials /
CPA REVISED 12/22 (PAGE 15 OF 17) Buyer's Initials / Seller's Initials / COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 15 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 16710 &16726 94
Property Address: Date:

39. OFFER
A. EXPIRATION OF OFFER: This offer shall be deemed revoked and the deposit, if any, shall be returned to Buyer unless by the date and time specified in paragraph 3C, the offer is Signed by Seller and a Copy of the Signed offer is Delivered to Buyer or Buyer's Authorized Agent. Seller has no obligation to respond to an offer made.

B. ENTITY BUYERS: (Note: If this paragraph is completed, a Representative Capacity Signature Disclosure (C.A.R.

Form RCSD) is not required for the Legally Authorized Signers designated below.) (1) One or more Buyers is a trust, corporation, LLC, probate estate, partnership, holding a power of attorney or other entity. (2) This Agreement is being Signed by a Legally Authorized Signer in a representative capacity and not in an individual capacity. See paragraph 35 for additional terms.
(3) The name(s) of the Legally Authorized Signer(s) is/are: . (4) If a trust, identify Buyer as trustee(s) of the trust or by simplified trust name (ex. John Doe, co-trustee, Jane Doe, co-trustee or Doe Revocable Family Trust).
(5) If the entity is a trust or under probate, the following is the full name of the trust or probate case, including case #:
.

C. The CPA has 17 pages. Buyer acknowledges receipt of, and has read and understands, every page and all attachments that make up the Agreement.

D. BUYER SIGNATURE(S):
(Signature) By, Date:

Printed name of BUYER:

Printed Name of Legally Authorized Signer: Title, if applicable, (Signature) By, Date:

Printed name of BUYER:

Printed Name of Legally Authorized Signer: Title, if applicable, IF MORE THAN TWO SIGNERS, USE Additional Signature Addendum (C.A.R. Form ASA).

40. ACCEPTANCE
A. ACCEPTANCE OF OFFER: Seller warrants that Seller is the owner of the Property or has the authority to execute this Agreement. Seller accepts the above offer and agrees to sell the Property on the above terms and conditions. Seller has read and acknowledges receipt of a Copy of this Agreement and authorizes Agent to Deliver a Signed Copy to Buyer.

Seller's acceptance is subject to the attached Counter Offer or Back-Up Offer Addendum, or both, checked below.

Seller shall return and include the entire agreement with any response.

Seller Counter Offer (C.A.R. Form SCO or SMCO)
Back-Up Offer Addendum (C.A.R. Form BUO)
B. Entity Sellers: (Note: If this paragraph is completed, a Representative Capacity Signature Disclosure form (C.A.R.

Form RCSD) is not required for the Legally Authorized Signers designated below.) (1) One or more Sellers is a trust, corporation, LLC, probate estate, partnership, holding a power of attorney or other entity. (2) This Agreement is being Signed by a Legally Authorized Signer in a representative capacity and not in an individual capacity. See paragraph 35 for additional terms.
(3) The name(s) of the Legally Authorized Signer(s) is/are: , . (4) If a trust, identify Seller as trustee(s) of the trust or by simplified trust name (ex. John Doe, co-trustee, Jane Doe, co-trustee or Doe Revocable Family Trust).
(5) If the entity is a trust or under probate, the following is the full name of the trust or probate case, including case #:
.

C. The CPA has 17 pages. Seller acknowledges receipt of, and has read and understands, every page and all attachments that make up the Agreement.

D. SELLER SIGNATURE(S):
(Signature) By, Date:

Printed name of SELLER:

Printed Name of Legally Authorized Signer: Title, if applicable, (Signature) By, Date:

Printed name of SELLER:

Printed Name of Legally Authorized Signer: Title, if applicable, IF MORE THAN TWO SIGNERS, USE Additional Signature Addendum (C.A.R. Form ASA).

OFFER NOT ACCEPTED: ______/______ No Counter Offer is being made. This offer was not accepted by Seller __________ (date) Seller's Initials
CPA REVISED 12/22 (PAGE 16 OF 17)
COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 16 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 X
Matthew Ballantyne
City of Fontana
X Matthew Ballantyne City Manager
J. Esther Taylor
16710 &16726 95
Property Address: Date:

REAL ESTATE BROKERS SECTION:

1. Real Estate Agents are not parties to the Agreement between Buyer and Seller.

2. Agency relationships are confirmed as stated in paragraph 2.

3. Cooperating Broker Compensation: Seller's Broker agrees to pay Buyer's Broker and Buyer's Broker agrees to accept, out of Seller's Broker's proceeds in escrow, the amount specified in the MLS, provided Buyer's Broker is a Participant of the MLS in which the Property is offered for sale or a reciprocal MLS. If Seller's Broker and Buyer's Broker are not both Participants of the MLS, or a reciprocal MLS, in which the Property is offered for sale, then compensation must be specified in a separate written agreement (C.A.R. Form CBC). Declaration of License and Tax (C.A.R. Form DLT) may be used to document that tax reporting will be required or that an exemption exists.

4. Presentation of Offer: Pursuant to the National Association of REALTORS® Standard of Practice 1-7, if Buyer's Agent makes a written request, Seller's Agent shall confirm in writing that this offer has been presented to Seller.

5. Agents' Signatures and designated electronic delivery address:

A. Buyer's Brokerage Firm Lic. #
By Lic. # Date
By Lic. # Date
Address City State Zip
Email Phone #
More than one agent from the same firm represents Buyer. Additional Agent Acknowledgement (C.A.R. Form AAA) attached.

More than one brokerage firm represents Buyer. Additional Broker Acknowledgement (C.A.R. Form ABA) attached.

Designated Electronic Delivery Address(es) (check all that apply):

Email above Text to Phone # above Alternate:

B. Seller's Brokerage Firm Lic. #
By Lic. # Date
By Lic. # Date
Address City State Zip
Email Phone #
More than one agent from the same firm represents Seller. Additional Agent Acknowledgement (C.A.R. Form AAA) attached.

More than one brokerage firm represents Seller. Additional Broker Acknowledgement (C.A.R. Form ABA) attached.

Designated Electronic Delivery Address(es) (To be filled out by Seller's Agent) (check all that apply):

Email above Text to Phone # above Alternate:

ESCROW HOLDER ACKNOWLEDGMENT:

Escrow Holder acknowledges receipt of a Copy of this Agreement, (if checked, a deposit in the amount of $ ), Counter Offer numbers and , and agrees to act as Escrow Holder subject to paragraph 22 of this Agreement, any supplemental escrow instructions and the terms of Escrow Holder's general provisions.

Escrow Holder is advised by that the date of Acceptance of the Agreement is Escrow Holder Escrow #
By Date
Address
Phone/Fax/E-mail
Escrow Holder has the following license number #
Department of Financial Protection and Innovation, Department of Insurance, Department of Real Estate.

PRESENTATION OF OFFER: / Seller's Brokerage Firm presented this offer to Seller on (date).

Broker or Designee Initials
© 2022, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
CPA REVISED 12/22 (PAGE 17 OF 17)
COMMERCIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (CPA PAGE 17 OF 17) Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335 February 19, 2024 Sierra Realty Fontana Inc 02038519
Ken Galasso 00570875
9410 Sierra Ave. Fontana CA 92335
[email protected] (909)226-9527
16710 &16726 96

BUYER'S INVESTIGATION ADVISORY
(C.A.R. Form BIA, Revised 12/21)
Property Address

1. IMPORTANCE OF PROPERTY INVESTIGATION: The physical condition of the land and improvements being purchased is not guaranteed by either Seller or Brokers. You have an affirmative duty to exercise reasonable care to protect yourself, including discovery of the legal, practical and technical implications of disclosed facts, and the investigation and verification of information and facts that you know or that are within your diligent attention and observation. A general physical inspection typically does not cover all aspects of the Property nor items affecting the Property that are not physically located on the Property. If the professionals recommend further investigations, including a recommendation by a pest control operator to inspect inaccessible areas of the Property, you should contact qualified experts to conduct such additional investigations.

2. BROKER OBLIGATIONS: Brokers do not have expertise in all areas and therefore cannot advise you on many items, such as those listed below. If Broker gives you referrals to professionals, Broker does not guarantee their performance.

3. YOU ARE STRONGLY ADVISED TO INVESTIGATE THE CONDITION AND SUITABILITY OF ALL ASPECTS OF THE PROPERTY, INCLUDING BUT NOT LIMITED TO THE FOLLOWING. IF YOU DO NOT DO SO, YOU ARE ACTING AGAINST THE ADVICE OF BROKERS.

A. GENERAL CONDITION OF THE PROPERTY, ITS SYSTEMS AND COMPONENTS: Foundation, roof (condition, age, leaks, useful life), plumbing, heating, air conditioning, electrical, mechanical, security, pool/spa (cracks, leaks, operation), other structural and non-structural systems and components, fixtures, built-in appliances, any personal property included in the sale, and energy efficiency of the Property.

B. SQUARE FOOTAGE, AGE, BOUNDARIES: Square footage, room dimensions, lot size, age of improvements and boundaries. Any numerical statements regarding these items are APPROXIMATIONS ONLY and have not been verified by Seller and cannot be verified by Brokers. Fences, hedges, walls, retaining walls and other barriers or markers do not necessarily identify true Property boundaries.

C. WOOD DESTROYING PESTS: Presence of, or conditions likely to lead to the presence of wood destroying pests and organisms.

D. SOIL STABILITY: Existence of fill or compacted soil, expansive or contracting soil, susceptibility to slippage, settling or movement, and the adequacy of drainage.

E. WATER AND UTILITIES; WELL SYSTEMS AND COMPONENTS; WASTE DISPOSAL: Water and utility availability, use restrictions and costs. Water quality, adequacy, condition, and performance of well systems and components. The type, size, adequacy, capacity and condition of sewer and septic systems and components, connection to sewer, and applicable fees.

F. ENVIRONMENTAL HAZARDS: Potential environmental hazards, including, but not limited to, asbestos, leadbased paint and other lead contamination, radon, methane, other gases, fuel oil or chemical storage tanks, contaminated soil or water, hazardous waste, waste disposal sites, electromagnetic fields, nuclear sources, and other substances, materials, products, or conditions (including mold (airborne, toxic or otherwise), fungus or similar contaminants).

G. EARTHQUAKES AND FLOODING: Susceptibility of the Property to earthquake/seismic hazards and propensity of the Property to flood.

H. FIRE, HAZARD, AND OTHER INSURANCE: The availability and cost of necessary or desired insurance may vary.

The location of the Property in a seismic, flood or fire hazard zone, and other conditions, such as the age of the Property and the claims history of the Property and Buyer, may affect the availability and need for certain types of insurance. Buyer should explore insurance options early as this information may affect other decisions, including the removal of loan and inspection contingencies.

I. BUILDING PERMITS, ZONING, GOVERNMENTAL REQUIREMENTS, AND ADDRESS: Permits, inspections, certificates, zoning, other governmental limitations, restrictions, and requirements affecting the current or future use of the Property, its development or size. Postal/mailing address and zip code may not accurately reflect the city which has jurisdiction over the property.

J. RENTAL PROPERTY RESTRICTIONS: The State, some counties, and some cities impose restrictions that limit the amount of rent that can be charged, the maximum number of occupants, and the right of a landlord to terminate a tenancy. Deadbolt or other locks and security systems for doors and windows, including window bars, should be examined to determine whether they satisfy legal requirements.

K. SECURITY AND SAFETY: State and local Law may require the installation of barriers, access alarms, selflatching mechanisms and/or other measures to decrease the risk to children and other persons of existing swimming pools and hot tubs, as well as various fire safety and other measures concerning other features of the Property.
© 2021, California Association of REALTORS®, Inc.

BIA REVISED 12/21 (PAGE 1 OF 2)
BUYER'S INVESTIGATION ADVISORY (BIA PAGE 1 OF 2)
Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
97 L. NEIGHBORHOOD, AREA, SUBDIVISION CONDITIONS; PERSONAL FACTORS: Neighborhood or area conditions, including schools, law enforcement, crime statistics, registered felons or offenders, fire protection, other government services, availability, adequacy and cost of internet connections or other technology services and installations, commercial, industrial or agricultural activities, existing and proposed transportation, construction and development that may affect noise, view, or traffic, airport noise, noise or odor from any source, wild and domestic animals, other nuisances, hazards, or circumstances, protected species, wetland properties, botanical diseases, historic or other governmentally protected sites or improvements, cemeteries, facilities and condition of common areas of common interest subdivisions, and possible lack of compliance with any governing documents or Homeowners' Association requirements, conditions and influences of significance to certain cultures and/or religions, and personal needs, requirements and preferences of Buyer.

By signing below, Buyers acknowledge that they have read, understand, accept and have received a Copy of this Advisory. Buyers are encouraged to read it carefully.

Buyer Date
Buyer Date
© 2021, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
BIA REVISED 12/21 (PAGE 2 OF 2)
BUYER'S INVESTIGATION ADVISORY (BIA PAGE 2 OF 2)
Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com City of Fontana
16710 &16726 98

FAIR APPRAISAL ACT ADDENDUM
(C.A.R. Form FAAA, 6/22)
The following terms and conditions are hereby incorporated in and made a part of the Purchase Agreement, OR Other (“Agreement”),
dated , on property known as ("Property"),
in which is referred to as (“Seller”)
and is referred to as (“Buyer”).

Any appraisal of the property is required to be unbiased, objective, and not influenced by improper or illegal considerations, including, but not limited to, any of the following: race, color, religion (including religious dress, grooming practices, or both), gender (including, but not limited to, pregnancy, childbirth, breastfeeding, and related conditions, and gender identity and gender expression), sexual orientation, marital status, medical condition, military or veteran status, national origin (including language use and possession of a driver's license issued to persons unable to provide their presence in the United States is authorized under federal law), source of income, ancestry, disability (mental and physical, including, but not limited to, HIV/ AIDS status, cancer diagnosis, and genetic characteristics), genetic information, or age.

If a buyer or seller believes that the appraisal has been influenced by any of the above factors, the seller or buyer can report this information to the lender or mortgage broker that retained the appraiser and may also file a complaint with the Bureau of Real Estate Appraisers at https://www2.brea.ca.gov/complaint/ or call (916) 552-9000 for further information on how to file a complaint.

By signing below, Buyer and Seller has each read, understands and acknowledges receipt of a copy of this Fair Appraisal Act Addendum.

Buyer Date
Buyer Date
Seller Date
Seller Date
© 2022, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
FAAA 6/22 (PAGE 1 OF 1)
FAIR APPRAISAL ACT ADDENDUM (FAAA PAGE 1 OF 1)
Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com 16710 & 16726 Spring St, Fontana, CA 92335
J. Esther Taylor
City of Fontana
City of Fontana
J. Esther Taylor
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
99 POSSIBLE REPRESENTATION OF MORE THAN ONE BUYER

OR SELLER - DISCLOSURE AND CONSENT
(C.A.R. Form PRBS, Revised 12/21)
A real estate broker (Broker), whether a corporation, partnership or sole proprietorship, may represent more than one buyer or seller. This multiple representation can occur through an individual licensed as a broker or salesperson or through different individual broker's or salespersons (associate licensees) acting under the Broker's license. The associate licensees may be working out of the same or different office locations.

Multiple Buyers: Broker (individually or through its associate licensees) may be working with many prospective buyers at the same time. These prospective buyers may have an interest in, and make offers on, the same properties. Some of these properties may be listed with Broker and some may not. Broker will not limit or restrict any particular buyer from making an offer on any particular property whether or not Broker represents other buyers interested in the same property.

Multiple Sellers: Broker (individually or through its associate licensees) may have listings on many properties at the same time. As a result, Broker will attempt to find buyers for each of those listed properties. Some listed properties may appeal to the same prospective buyers. Some properties may attract more prospective buyers than others. Some of these prospective buyers may be represented by Broker and some may not. Broker will market all listed properties to all prospective buyers whether or not Broker has another or other listed properties that may appeal to the same prospective buyers.

Dual Agency: If Seller is represented by Broker, Seller acknowledges that broker may represent prospective buyers of Seller's property and consents to Broker acting as a dual agent for both seller and buyer in that transaction. If Buyer is represented by Broker, buyer acknowledges that Broker may represent sellers of property that Buyer is interested in acquiring and consents to Broker acting as a dual agent for both buyer and seller with regard to that property.

In the event of dual agency, seller and buyer agree that: a dual agent may not, without the express permission of the respective party, disclose to the other party confidential information, including, but not limited to, facts relating to either the buyer's or seller's financial position, motivations, bargaining position, or other personal information that may impact price, including the seller's willingness to accept a price less than the listing price or the buyer's willingness to pay a price greater than the price offered; and except as set forth above, a dual agent is obligated to disclose known facts materially affecting the value or desirability of the Property to both parties.

Offers not necessarily confidential: Buyer is advised that seller or listing agent may disclose the existence, terms, or conditions of buyer's offer unless all parties and their agent have signed a written confidentiality agreement. Whether any such information is actually disclosed depends on many factors, such as current market conditions, the prevailing practice in the real estate community, the listing agent's marketing strategy and the instructions of the seller.

Buyer and seller understand that Broker may represent more than one buyer or more than one seller and even both buyer and seller on the same transaction and consents to such relationships.

Seller and/or Buyer acknowledges reading and understanding this Possible Representation of More Than One Buyer or Seller - Disclosure and Consent and agrees to the agency possibilities disclosed.

Seller Date
Seller Date
Buyer Date
Buyer Date
Buyer's Brokerage Firm DRE Lic #
By DRE Lic # Date
Seller's Brokerage Firm DRE Lic #
By DRE Lic # Date
© 2021, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
PRBS REVISED 12/21 (PAGE 1 OF 1)
POSSIBLE REPRESENTATION OF MORE THAN ONE BUYER OR SELLER (PRBS PAGE 1 OF 1) Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com J. Esther Taylor
City of Fontana
Sierra Realty Fontana Inc 02038519
00570875
Ken Galasso
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
100

CALIFORNIA CONSUMER PRIVACY ACT ADVISORY,

DISCLOSURE AND NOTICE
(C.A.R. Form CCPA, Revised 12/22)
The California Consumer Privacy Act (commencing with Civil Code § 1798.100) (“CCPA”), as amended by California voters in 2020, grants to California residents certain rights in their private, personal information (“PI”) that is collected by companies with whom they do business. Under the CCPA, PI is defined broadly to encompass non-public records information that could reasonably be linked directly or indirectly to you. PI could potentially include photographs of, or sales information about, your property.

During the process of buying and selling real estate your PI will be collected and likely shared with others, including real estate licensees, a Multiple Listing Service, real estate internet websites, service providers, lenders, and title and escrow companies, to name several possibilities. Businesses that are covered by the CCPA are required to grant you various rights in your PI, including the right to know what PI is collected, the right to know what PI is sold or shared and to whom, the right to request that the business correct or delete your PI, the right to “opt out” or stop the transfer of your PI to others, and the right to limit the use of certain PI which is considered “sensitive.” You may get one or more notices regarding your CCPA rights from businesses you interact with in a real estate transaction. However, not all businesses that receive or share your PI are obligated to comply with the CCPA. Moreover, businesses that are otherwise covered under the CCPA may have a legal obligation to maintain PI, notwithstanding your instruction to the contrary. For instance, regardless of whether they are covered by CCPA, under California law, brokers and Multiple Listing Services are required to maintain their records for 3 years. If you wish to exercise your rights under CCPA, where applicable, you should contact the respective business directly.

You can obtain more information about the CCPA and your rights under the law from the State of California Department of Justice (oag.ca.gov/privacy/ccpa). Additionally, the California Privacy Protection Agency is authorized to promulgate regulations which may further clarify requirements of the CCPA (cppa.ca.gov/regulations/).

I/we acknowledge receipt of a copy of this California Consumer Privacy Act Advisory, Disclosure and Notice.

Buyer/Seller/Landlord/Tenant Date

Buyer/Seller/Landlord/Tenant Date

© 2022, California Association of REALTORS®, Inc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reproduction of this form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS®. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real estate professionals through an agreement with or purchase from the California Association of REALTORS®. It is not intended to identify the user as a REALTOR®. REALTOR® is a registered collective membership mark which may be used only by members of the NATIONAL ASSOCIATION OF REALTORS® who subscribe to its Code of Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIATION OF REALTORS® 525 South Virgil Avenue, Los Angeles, California 90020
CCPA REVISED 12/22 (PAGE 1 OF 1)
CALIFORNIA CONSUMER PRIVACY ACT ADVISORY (CCPA PAGE 1 OF 1) Phone: Fax:

Produced with Lone Wolf Transactions (zipForm Edition) 717 N Harwood St, Suite 2200, Dallas, TX 75201 www.lwolf.com City of Fontana
Sierra Realty, 9410 Sierra Ave. Fontana CA 92335 909.822.1200 909.822.0324 16710 &16726 Ken Galasso
101
City of Fontana
Action Report
City Council Meeting
8353 Sierra Avenue
Fontana, CA 92335
File #: 21-2960 Agenda Date: 5/14/2024
Agenda #: D. Category: Consent Calendar
FROM:

Public Works
SUBJECT:

Award a Construction Contract for Public Works Concrete Maintenance Project (PW-24-133-SB) RECOMMENDATION:

Approve and authorize the City Manager to execute a construction contract with We R Builders, Inc. from Glendale CA for the construction of the Public Works Concrete Maintenance Project in the amount of $289,836.00 and authorize a 10% contingency in the amount of $28,983.60 COUNCIL GOALS:
· Invest in the City’s infrastructure (streets, sewers, parks, etc.) by maintaining and improving the city's existing infrastructure.
· Invest in the City’s infrastructure (streets, sewers, parks, etc.) by providing for the development of new infrastructure.

DISCUSSION:

The Public Works Department (Street and Utility Division) is charged with maintaining a network of existing sidewalks, pedestrian access ramps, curbs, gutters, driveway approaches, and other miscellaneous concrete improvements.

On February 27, 2024, the Public Works Department (Street and Utility Division) advertised the project for sidewalks, curbs, gutters, curb ramps, walkways, cross-gutters, and driveway approaches within the Sierra Lakes tract boundary. The bid was sent to three hundred twenty (320) bidders who were notified of the bid. Bid packets were downloaded/received by thirty-five (35) vendors and we received thirteen (13) bid responses. Twenty-four (24) Fontana vendors were notified. One (1) Fontana vendor response was received. The Sealed Bids were opened electronically at 2:00 p.m. on March 14, 2024. The bids ranged from $289,836.00 to $524,699.49. We R Builders, Inc. is the lowest bidder in the amount of $289,836.00. The engineer’s estimate was $304,000.

After reviewing the proposed bid documents and performing the reference checks, the Public Works Department has determined We R Builders, Inc. to be the lowest responsible and responsive bidder.

FISCAL IMPACT:

Funds have been budgeted in FY 2023/24 in the Capital Reinvestment Fund 601 in the Sidewalk Rehabilitation Project No. 37104326. 601 A. 8329 $183,336.56 and in Concrete Maintenance Operating Budgets 10137106 8130 $55,033.04 and 28137106 8130 $80,450.00. This funding includes the 10% contingency.

City of Fontana Page 1 of 2 Printed on 5/8/2024
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File #: 21-2960 Agenda Date: 5/14/2024
Agenda #: D. Category: Consent Calendar
MOTION:

Approve staff recommendation.

City of Fontana Page 2 of 2 Printed on 5/8/2024
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Bid List
Bid Results for Project Public Works Concrete Maintenance Project (PW-24-133-SB) No. Vendor Name City Bid Amount
1 We R Builders, Inc. Glendale $289,836.00
2 S&H Civilworks Colton $290,231.00
3 Loamic Builders Inc Fontana $295,657.51
4 I E General Engineering Inc. Wildomar $315,052.00
5 Kalban, Inc. Sun Valley $323,618.25
6 Dash Construction Company Inc Woodland Hills $328,272.60 7 EBS General Engineering, Inc. Corona $334,165.00
8 TVR Construction Engineering LLC Riverside $339,463.00 9 DM Contracting Inc.. Colton $379,995.62
10 Garcon Construction Ontario $393,762.92
11 Aneen Construction, Inc. Riverside $416,636.00
12 Gentry General Engineering Inc Rancho Cucamonga $458,956.00 13 CT&T Concrete Paving Inc. Diamond Bar $524,699.49
104
City of Fontana
Public Works Concrete Maintenance Project (PW-24-133-SB), bidding on 03/14/2024 2:00 PM (PDT)