Agenda packet — Lancaster City Council, May 24, 2022 (part 1 of 4)

Tuesday, May 24, 2022
Regular Meeting – 5:00 PM
The City Clerk/Agency/Authority Secretary hereby declares the agenda was posted by 5:00 p.m. on M a y 2 0 , 2022
at the main entrance to Lancaster City Hall
44933 Fern Avenue, Lancaster, CA 93534

LEGISLATIVE BODY
City Council/Successor Agency/Financing/Power/California Choice Energy Authority
Mayor/Chair R. Rex Parris
Vice Mayor/Vice Chair Marvin Crist
Council Member/Agency Director/Authority Member Darrell Dorris Council Member/Agency Director/Authority Member Raj Malhi Council Member/Agency Director/Authority Member Ken Mann Housing Authority
Deputy Mayor/Chair Kitty Kit Yee Szeto
Vice Chair Marvin Crist
Deputy Mayor/Authority Member Cassandra Harvey
Authority Member Raj Malhi
Authority Member Ken Mann

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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AGENDA ITEMS TO BE REMOVED
Sometimes it is necessary to remove items from the agenda. We apologize for any inconvenience this may cause you.

PUBLIC BUSINESS FROM THE FLOOR - AGENDIZED ITEMS
Any person who would like to address the Legislative Bodies on any agendized item is requested to complete a speaker card for the City Clerk/Agency/Authority Secretary and identify the agenda item you would like to discuss. Each person will be given an opportunity to address the Legislative Body at the time such item is discussed. Speaker cards are available at the rear of the Council Chambers and your speaker card must be filled out prior to the agenda item being called. We respectfully request that you fill the cards out completely and print as clearly as possible. Following this procedure will allow for a smooth and timely process for the meeting and we appreciate your cooperation. Individual speakers are limited to three (3) minutes each.

Consent Calendar items under the Legislative Body may be acted upon with one motion, a second and the vote. If you desire to speak on an item or items on the Consent Calendar, you may fill out one speaker card for the Consent Calendar. You will be given three minutes, unless a different time limit is announced, to address your concerns before the Legislative Body takes action on the Consent Calendar.

CALL TO ORDER
City Council/Successor Agency/Financing/Power/California Choice Energy Authority

ROLL CALL
City Council Members /Agency Directors /Authority Members: Dorris, Malhi, Mann; Vice Mayor/ Vice Chair Crist, Mayor/Chair Parris

ROLL CALL
Housing Authority Members: Harvey, Malhi, Man; Vice Chair Crist, Chair Szeto

INVOCATION
John Meadors, Christian Life Assembly

PLEDGE OF ALLEGIANCE

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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HOUSING AUTHORITY - NEW BUSINESS
HA NB 1. Residential Purchase Agreement and Joint Escrow Instructions for the sale of 45534 5th Street East to Cesar Elias and Santiago Elias
Recommendation:

1. Adopt Resolution No. H A 2-22 , approving a Residential Purchase Agreement and Joint Escrow Instructions for the sale of 45534 5th Street East, accepting the Health and Safety Code Section 33433 Report, and making certain findings pursuant to Health and Safety Code 33433.

2. Authorize the City Manager or his designee to execute all related documents.

Earlier this year, staff began receiving ongoing reports regarding vandalism to the house. The staff recommended it would be in the best interest of the neighbors and the City to sell the home and have it occupied immediately.

SUCCESSOR AGENCY - CONSENT CALENDAR
SA CC 1. Fourth Amendment to Declaration of Covenants, Conditions and Restrictions for the Auto Mall
Recommendation:

1. Approve a Fourth Amendment to the Declaration of Covenants, Conditions and Restrictions for the Auto Mall.

2. Approve a Waiver with Mass Investments Group, LLC to detach from the Landscape Maintenance District within the Auto Mall.

3. Authorize the Executive Director or his designee to finalize and execute all related documents.

As part of the Second Amendment to the Declaration that was recorded in 1995, the owners of the property within the Auto Mall decided to detach from the existing Landscape Maintenance District. A waiver was executed that requires the owners to maintain the landscaped areas themselves. When a property is transferred or sold, a new waiver must be executed by the new buyer. With the pending sale between Viper Enterprises Inc. and Mass Investments Group, LLC a new waiver must be executed. If approved, the amendment and waiver will be executed and recorded as part of the property sale.

CALIFORNIA CHOICE ENERGY AUTHORITY - CONSENT CALENDAR
CCEA CC 1. Approve California Choice Energy Authority Entering into Long-Term Resource Adequacy Agreements with Santa Paula Energy Storage, LLC on behalf of Apple Valley Choice Energy, Lancaster Choice Energy, Pico Rivera Innovative Municipal Energy, Pomona Choice Energy, Rancho Mirage Energy Authority, San Jacinto Power, and Santa Barbara Clean Energy

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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Recommendation:

1. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Apple Valley Choice Energy.

2. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Lancaster Choice Energy.

3. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Pico Rivera Innovative Municipal Energy.

4. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Pomona Choice Energy.

5. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Rancho Mirage Energy Authority.

6. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of San Jacinto Power.

7. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Santa Barbara Clean Energy
CalChoice and its legal and technical team have negotiated an agreement with developer esVolta for the Santa Paula Energy Storage, LLC project (Santa Paula Energy Storage).

The project is a stand-alone battery storage project located in Santa Paula, California, will a commercial delivery date of August 2023.

CCEA CC 2. Approve California Choice Energy Authority Entering into Long-Term Resource Adequacy Agreements with Resi Station, LLC on behalf of Apple Valley Choice Energy, Lancaster Choice Energy, Pico Rivera Innovative Municipal Energy, Rancho Mirage Energy Authority, and San Jacinto Power
Recommendation:

1. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Apple Valley Choice Energy.

2. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Lancaster Choice Energy.

3. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Pico Rivera Innovative Municipal Energy.

4. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Rancho Mirage Energy Authority.

5. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of San Jacinto Power.

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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CalChoice solicited bilateral offers for projects that would meet the requirements of the Decision for those member agencies responsible for procuring the incremental resources:

AVCE, LCE, PRIME, RMEA, and SJP. CalChoice and its legal and technical team have negotiated an agreement with demand response provider OhmConnect, Inc. for the Resi Station, LLC project (Resi Station). The project will begin delivering resource adequacy for LCE in August of 2022, and for AVCE, PRIME, RMEA, and SJP in 2023.

COUNCIL ACTIONS

CONSENT CALENDAR
CC 1. Waive further reading of any proposed ordinances. (This permits reading the title only in lieu of reciting the entire text.)
CC 2. Approve the City Council/Successor Agency/Housing/Financing/Power/California Choice Energy Authority Regular Meeting Minutes of May 3, 2022.

CC 3. Check Registers – April 17, 2022 through May 7, 2022 Recommendation(s):

Approve the Check and Wire Registers for April 17, 2022 through May 7, 2022 in the amount of $3,765,767.19 as presented.

At each regular City Council Meeting, the City Council is presented with check and ACH/wire registers listing the financial claims (invoices) against the City for purchase of materials, supplies, services, and capital projects issued the prior three to four weeks. This process provides the City Council the opportunity to review the expenditures of the City. Claims are paid via checks, Automated Clearing House (ACH) payments, or federal wires. The justifying backup information for each expenditure is available in the Finance Department.

CC 4. Monthly Report of Investments – April 2022
Recommendation(s):

Accept and approve the April 2022 Monthly Report of Investments as submitted.

Each month, the Finance Department prepares a report listing the investments for all separate entities under the jurisdiction of the City as identified in the City’s Comprehensive Annual Financial Report.

CC 5. Construction Award of Bid – PWCP 22-010 – Lancaster Performing Arts Center (LPAC) Improvements
Recommendation(s):

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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1. Award PWCP 22-010, Lancaster Performing Arts Center (LPAC) Improvements , to Blessedco Electric, Inc. of Palmdale, California, in the amount of $203,440.00 plus a 25% contingency, to install network and lighting equipment and perform power upgrades that will transition
LPAC to LED Lighting. Authorize the City Manager, or his designee, to sign all documents.

This contract is awarded to the lowest, responsive, responsible bidder per California Public Code Section 22038 (b).

2. Approve a budget transfer of $46,000.00 from Account No. 101-2900-000, General Fund Balance to Account No. 101-11BS002-924, LPAC Improvements.

On March 8, 2022, Council approved the award of RFP 752-22, Lancaster Performing Arts Center (LPAC) Lighting Improvements to purchase the materials necessary to upgrade LPAC to LED lighting. Due to long lead times on the equipment, it was necessary to split the materials purchase and installation services into two separate contracts. This proposed contract is for installation of the previously purchased materials, as well as network and power upgrades, in order to complete the conversion to LED Lighting. The new LED lighting will be far more efficient and cost effective than the existing incandescent lighting, and will allow LPAC to advance and remain competitive and convenient for touring artists.

CC 6. Final Map Approval – Parcel Map No. 83447 (Located at the Northeast Corner of 15th Street West and Avenue K)
Recommendation(s):

Approve the map and accept the dedications as offered on Parcel Map No. 83447, located at the Northeast corner of 15 th Street West and Avenue K; make findings that this project will not violate any of the provisions of Sections 66473.5, 66474.1 and 66474.6 of the Subdivision Map Act; and instruct the City Clerk to endorse on the face of the map the certificate which embodies the approval of said map and the dedications shown thereon.

On Jun 11, 2021, Development Services Department – Community Development Division approved Tentative Administrative Parcel Map No. 83447 for subdividing 9.36 acres into seven parcels in the Commercial Planned Development (CPD) zone. The Final Map is in substantial conformance with the approved tentative administrative map. Parcel Map No. 83447 has been examined by the City Surveyor, is in substantial conformance with the approved tentative administrative map and is ready for Council approval. The securities for this map will be in the form of a Development Improvement Undertaking Agreement, including Faithful Performance Bond and Labor and Materials Bond under Site Plan Review 21-12, which will guarantee and secure the performance of all public improvements, impact fees, and public agency fees.

CC 7. Task Order for Multi-Year Professional Services (Service Group Category 12 – Development Plan Check) Grading Permit and Encroachment Permit Plan Checking (Including Traffic Plan Check) for CDP 18-05 – Permit Plan Checking
Recommendation(s):

1. Approve an increase in the Purchase Order (PO 22-00891) for Task Order No. 2 with Cannon Corporation in the amount of $350,000.00 and authorize the City Manager or his designee to sign all documents.

2. Appropriate $42,695.00 from Fund balance to Account No. 101-4761-301.

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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In accordance with the multi-year agreement, each fiscal year a new Purchase Order (PO) is approved for Cannon Corp. in the amount of $120,000.00 for the payment of their services. Due to an increase in private development and corresponding increase in grading and encroachment plan check submittals, the PO for this fiscal year must be increased by $350,000.00 for a total Purchase Order amount of $470,000.

CC 8. Final Map Approval – Tract Map No. 60430 (Located at the Northwest Corner of Avenue K and 36th Street West)
Recommendation(s):

Approve the map and accept the dedications as offered on Tract Map No. 60430 located at the Northwest corner of Avenue K and 36 th Street West ; make findings that this project will not violate any of the provisions of Sections 66473.5, 66474.1 and 66474.6 of the Subdivision Map Act; and instruct the City Clerk to endorse on the face of the map the certificate which embodies the approval of said map and the dedications shown thereon.

On March 21, 2016, the City of Lancaster Planning Commission approved Tentative Tract Map No. 60430. (revised on March 19, 2021). The Final Parcel Map is in substantial conformance with the approved tentative map. Tract Map No. 60430 has been examined by the City Surveyor, and is ready for Council approval. In addition, an Undertaking Agreement and improvement securities have been submitted to guarantee the installation of improvements.

CC 9. Approval of a Memorandum of Understanding with Midas Lancaster, LP for Maintenance of the Electric Vehicle Charging Stations at the BLVD Marriott Recommendation(s):

Approve a Memorandum of Understanding with Midas Lancaster, LP (Midas) for maintenance of the Electric Vehicle (EV) Charging Stations that were installed by the City at the BLVD Marriott. Authorize the City Manager, or his designee, to sign all documents.

With approval of this MOU, the City will provide for and pay all costs associated with maintenance of the EV stations, meters, signage and/or other required equipment. Midas will have contact information for a City staff member who will be available to respond during normal City business hours to any issues that may arise concerning the EV Stations, and the City will promptly respond to such issues. The City is solely responsible for compliance with the terms and conditions of the grant provided by AVAQMD.

CC 10. Lancaster Performing Arts Center Air Conditioning Installation Recommendation(s):
a. Award RFQ 752-22 LPAC Air Conditioning Installation, to Simco Mechanical Inc. of Glendale, California, in the amount of $152,000.00 plus a 25% contingency, to remove and dispose of three, 20-ton AC units, and install three new 20-ton AC units; b. Authorize the City Manager, or his designee, to sign all documents. This contract is awarded to the lowest, responsive, responsible bidder per California Public Code Section 22038 (b); c. Allocate $190,000.00 from the general fund balance to Account Number 101 12ZZ005924 - LPAC AC to cover costs associated with RFQ 752-22 LPAC Air Conditioning Installation.

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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The Lancaster Performing Arts Center was opened to the public in November 1991. Over 30 years, LPAC has brought thousands of performers to Lancaster for our community to enjoy. It is currently the largest performing arts facility in the northernmost part of Los Angeles County and is a proud partner of the BLVD Cultural District. This well-used facility has aged and certain critical assets have begun to fail and cause inconveniences. Current units are over 30 years old and fail frequently. New units will provide more efficient and effective use of resources, and will provide a long-term solution to the temperature control issues at the LPAC’s house and lobby. Furthermore, this project would provide assured and comfortable temperatures to visitors and staff as they come to LPAC to enjoy performances.

CC 11. Los Angeles County Homeless Innovation Funds Round Two Recommendation(s):
a. Accept Los Angeles County Innovation Grant Funds Round Two in the amount of $2,379,969 to revenue account 261-3303-133.
b. Appropriate $2,379.969 to expenditure account 261-4300-772, for the implementation of the Cities Homelessness Plan Implementation Grant programs/projects. c. Authorize the City Manager or designee to execute all contracts and associated documents, including partnership agreement, subject to City Attorney approval.

The City of Lancaster responded with very specific project/program proposals, leveraging existing community resources and partnerships, for a maximized return. After an extensive review process conducted by the Chief Executive Office for the County of Los Angeles, the City of Lancaster was selected to receive the maximum award amount of $2,379,969.

CC 12. Lancaster Performing Arts Center Generator Installation Recommendation(s):

1. Award LPAC Generator Installation, to High Volt Electric, of Chatsworth, CA in the amount of $325,390 plus a 25% contingency, to remove and replace the 200kw Generator currently providing temporary power to LPAC.

2. Authorize the City Manager, or his designee, to sign all documents. This contract is awarded per California Public Code Section 22038 (c).

3. Allocate $406,738 from the general fund balance to Account No. 101 12ZZ006924-LPAC Generator to cover costs associated with LPAC Generator Installation.

In January 2022, the City issued RFQ 753-22. Responses were received from High Volt Electric, and Blue Ridge Mechanical Corp. However, the variance in the bid amounts led to the City canceling the RFQ, and re-soliciting the project. RFQ 759-22 was reissued in February 2022, and no bids were received. Staff tabled the project for a few months, and recently began negotiations with High Volt Electric. Upon review of High Volt Electric’s proposal, timeline for installation, and references, staff is confident High Volt Electric is a highly qualified and responsive contractor, that is capable of completing this project as required.

CC 13. Approve California Choice Energy Authority Entering into a Long-Term Resource Adequacy Agreement with Santa Paula Energy Storage, LLC on behalf of Lancaster Choice Energy

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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Recommendation(s):

That the City Council Approve California Choice Energy Authority Entering into a Long-Term Resource Adequacy Agreement with Santa Paula Energy Storage, LLC on behalf of Lancaster Choice Energy.

As a condition of the agreement, Santa Paula Energy Storage recognizes and accepts the secured deposit account in the name of the City of Lancaster (City) as credit and collateral, and no other security or credit backing by the City will be required. Upon approval by the City and CalChoice, Santa Paula Energy Storage will execute a joinder to the Intercreditor and Collateral Agency Agreement, ensuring the protection of the City’s General Fund.

CC 14. Approve Resolution Authorizing the City of Lancaster to enter into the Joint Exercise of Powers Agreement relating to the California Cooperative Liquid Assets Securities System (CLASS) and to invest excess cash assets in shares of the California CLASS Recommendation(s):

A. Approve Resolution No. 22-18 Authorizing the City of Lancaster to enter into the Joint Exercise of Powers Agreement relating to the California Cooperative Liquid Assets Securities System (CLASS) and to invest excess cash assets in shares of the California CLASS B. Authorize the City Manager and/or his designee the Finance Director to participate as a founding member of the California CLASS JPA and to direct investments in California CLASS within the guidance of the City’s investment policy and California State Code Section 53601.

The League of California Cities (CALCities) Board of Directors had determined that they will sponsor California CLASS to its multi-City membership and has been provided the opportunity to participate in the founding of California CLASS, which includes the opportunity to appoint two members to the inaugural 5-member Board of Trustees. CALCities has recommended that George Harris, Finance Director, be one of the two appointees. As such, the City of Lancaster shall have an inaugural board member on the California Class Board of Trustees and be an inaugural member of the JPA. As the City of Lancaster is the “City of Firsts,” this opportunity is consistent with the City’s approach in many other past, current and future ventures.

CC 15. Approve California Choice Energy Authority Entering into a Long-Term Resource Adequacy Agreement with Resi Station, LLC on behalf of Lancaster Choice Energy Recommendation(s):

That the City Council Approve California Choice Energy Authority Entering into a Long-Term Resource Adequacy Agreement with Resi Station, LLC on behalf of Lancaster Choice Energy.

As a condition of the agreement, Resi Station recognizes and accepts the secured deposit account in the name of the City of Lancaster (City) as credit and collateral, and no other security or credit backing by the City will be required. Upon approval by the City and CalChoice, Resi Station will execute a joinder to the Intercreditor and Collateral Agency Agreement, ensuring the protection of the City’s General Fund.

CC 16. Fourth Amendment to Declaration of Covenants, Conditions and Restrictions for the Auto Mall Recommendation(s):

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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1. Approve a Fourth Amendment to the Declaration of Covenants, Conditions and Restrictions for the Auto Mall.

2. Approve a Waiver with Mass Investments Group, LLC to detach from the Landscape Maintenance District within the Auto Mall.

3. Authorize the City Manager or his designee to finalize and execute all related documents.

CC 17. Resolution Concerning (1) Proposed Increase to Solid Waste Handling Services Fee for Single- Family Dwellings and (2) Proposed Collection of Solid Waste Handling Services Fee for Single- Family Dwellings on the Tax Roll Pursuant to Section 5473 of the Health and Safety Code Recommendation(s):

Adopt Resolution No. 22-21 , concerning (1) proposed increase to solid waste handling services fee for single-family dwellings and (2) proposed collection of solid waste handling services fee for single-family dwellings on the tax roll pursuant to section 5473 of the Health and Safety Code.

PUBLIC HEARING
PH 1. An Ordinance of the City Council of the City of Lancaster, California, Repealing and Replacing Chapter 8.32 of the Lancaster Municipal Code to Regulate Smoking and Tobacco Product Use Recommendation:

A. That the City Council introduce Ordinance No. 1089 , repealing and replacing Chapter 8.32 of the Lancaster Municipal Code to regulate smoking and tobacco use.

B. Allocate $7,000 from the general fund to account 101 4631 404 to cover costs associated with replacing park ordinance signs.

The adoption of the ordinance will require the fabrication and installation of 65 new rules and regulations signs at parks and city-maintained facilities. The current signage does not include language to prohibit smoking and tobacco use. To provide for proper notification to the public and enforcement of the ordinance, the signs need to be updated to reflect the adopted ordinance.

The signage will be located throughout parks, including parking lot entrances, pedestrian access points, and adjacent to playgrounds and buildings. Portable a-frame signage will be purchase for use at City events. Furthermore, funds will be utilized for signage at service areas maintained by the City, such as the AVTA transfer station at Owen Memorial Park and Metrolink Link station.

JOINT PUBLIC HEARING

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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JPH1. Residential Purchase Agreement and Joint Escrow Instructions for the sale of 45534 5th Street East to Cesar Elias and Santiago Elias
Recommendation(s):

1. Adopt Resolution No. 22-19, approving a Residential Purchase Agreement and Joint Escrow Instructions for the sale of 45534 5th Street East, accepting the Health and Safety Code Section 33433 Report, and making certain findings pursuant to Health and Safety Code 33433.

2. Authorize the City Manager or his designee to execute all related documents.

Eventually, due to changing needs, the services for the Wellness Home located at 45534 5th Street East were consolidated at other locations. The home has remained vacant for the past several years. Earlier this year, staff began receiving ongoing reports regarding vandalism to the house. The staff recommended it would be in the best interest of the neighbors and the City to sell the home and have it occupied immediately.

NEW BUSINESS
NB1. Lancaster National Soccer Center Emergency Well Pump Replacement Recommendation(s):

1. Adopt Resolution No. 22-20 , finding that an emergency exits and authorize the repair of the well pump at the Lancaster National Soccer Center (LNSC).

2. Authorize the use of Emergency Contracting Procedures per Public Contract Code 22035 & 22050.

3. Authorize award of contract for Emergency Well Pump Replacement, to Legend Pump & Well Service, Inc., of San Bernardino, CA in the amount of $138,831 plus a 20% contingency, to remove and replace the well pump currently providing water to irrigate the Lancaster National Soccer Center.

4. Authorize the City Manager, or his designee, to sign all documents associated with these repairs.

The repair of the well pump is of the essence to preserve the turf. The well pumps approximately 1,000 gallons of water per minute, whereas the back up well only pumps approximately 400-500 gallons per minute. As we enter into the warmer months, a delay of 4-6 weeks for bidding, could result in the loss of over half a million dollars of athletic turf due to lack of adequate water.

Additionally, there are several regional soccer tournaments scheduled this summer, in addition to local league use. If the turf needs to be removed and replaced, the fields will be unusable for 2-3 months, resulting in lost revenue for tournaments, leagues, and City tourism dollars.

COUNCIL AGENDA
CA1. Consideration of Appointment and Nomination of Leslie Underwood as Commissioner to the Planning Commission.

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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CA2. Discussion and Possible Action of the City of Lancaster Proclaiming the Existence of a Dangerous Condition on Public Property State Route 14.

COUNCIL REPORTS
CR1. Council Reports

LANCASTER FINANCING AUTHORITY
No action required at this time.

LANCASTER POWER AUTHORITY
No action required at this time.

CITY MANAGER / EXECUTIVE DIRECTOR ANNOUNCEMENTS

CITY CLERK/AGENCY/AUTHORITY SECRETARY ANNOUNCEMENT

PUBLIC BUSINESS FROM THE FLOOR - NON-AGENDIZED ITEMS
This portion of the agenda allows an individual the opportunity to address the Legislative Bodies on any item NOT ON THE AGENDA regarding City/Agency/Authority business and speaker cards must be submitted prior to the beginning of this portion of the Agenda. Please complete a speaker card for the City Clerk/Agency/Authority Secretary and identify the subject you would like to address. We respectfully request that you fill the cards out completely and print as clearly as possible. Following this procedure will allow for a smooth and timely process for the meeting and we appreciate your cooperation. State law prohibits the Legislative Body from taking action on items not on the agenda and your matter may be referred to the City Manager/Executive Director. Individual Speakers are limited to three (3) minutes each unless a different time limit is announced.

CITY COUNCIL / AGENCY/ AUTHORITY COMMENTS

CLOSED SESSION

1. Conference with Legal Counsel - Anticipated Litigation: significant exposure to litigation pursuant to Government Code Section 54956.9(d) (2) - two potential cases.

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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2. Conference with Legal Counsel - Anticipated Litigation: consideration of initiation of litigation pursuant to Government Code Section 54956.9(d) (4) - two potential cases.

3. Antelope Valley Groundwater Cases Included Action:

Los Angeles County Waterworks District No. 40 v. Diamond Farming Co. Superior Court of California, County of Los Angeles, Case No. BC325201;
Los Angeles County Waterworks District No. 40 v. Diamond Farming Co. Superior Court of California, County of Kern, Case No. S-1500-CV-254-348; Wm. Bolthouse Farms, Inc. v. City of Lancaster, Diamond Farming Co. v. City of Lancaster, Diamond Farming Co. v. Palmdale Water District
Superior Court of California County of Riverside, consolidated actions; Case Nos. RIC 353 840, RIC 344 436, RIC 344 668

4. Ramos v Patino, LASC Case No. MC027974

5. Rahier v. City of Lancaster, LASC Case No. 19AVCV00163

6. Brisa Mahoney, et al. v. City of Lancaster, et al., LASC Case No. 2OSTCV02556

7. Manzo v. Beazer Homes Holdings, LLC et al., LASC Case No. 20AVCV00297

8. Hernandez v. County of Los Angeles, et al., LASC Case No. 20AVCV00318

9. Romines v. City of Lancaster, et al,, LASC Case No. 20AVCV00345

10. Moujan v. City of Lancaster et al., LASC Case No. 20AVCV00205

11. Davis v. State of California, LASC Case No. 19AVCV00805

12. Lancaster v. Netflix, et al., LASC 21STCV01881

13. Butts v. Lancaster, LASC 21STCP00389

14. Lancaster v. Rives

15. Myesha Lopez, et al. v. County of Los Angeles, et al. CDCA Case No. 5:21-cv-00290- JGB(SHKx)

16. Ortiz v. Lancaster, LASC Case No. 21AVCV00001

17. Aijala v. Lancaster, LASC Case No. 21STCV07841

18. Gardner v. Dominoids, LASC Case No. 21AVCV00186

19. Evans v. Lancaster, LASC Case No. 21AVCV00145

20. Bojorquez v. Lancaster, LASC Case No. 20AVCV00894

21. Arkey v. Lancaster, LASC Case No.20AVCV00816

22. Perez v. Lancaster, LASC Case No. 20AVCV00589

23. Serrano v. Los Angeles County et al. LASC Case No. 21AVCV00562

24. Jackson v. RE Schultz Construction et al. LASC Case No. 21AVCV00863

ADJOURNMENT
Next Regular Meeting:

June 14, 2022 at 5:00 PM

MEETING ASSISTANCE INFORMATION

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
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In compliance with the Americans with Disabilities Act, this meeting will be held at a location accessible to persons with disabilities; if you need special assistance to participate in this meeting, please contact the City Clerk at (661)723-6020. Services such as American Sign Language interpreters, a reader during the meeting, and/or large print copies of the agenda are available. To ensure availability, you are advised to make your request at least 72 hours prior to the meeting/event you wish to attend. Due to difficulties in securing sign language interpreters, five or more business days notice is strongly recommended. For additional information, please contact the City Clerk at (661)723-6020.

AGENDA ADDENDUM INFORMATION
On occasion items may be added after the agenda has been mailed to subscribers. Copies of the agenda addendum item will be available at the City Clerk Department and are posted with the agenda on the windows of the City Council Chambers. For more information, please call the City Clerk Department at (661) 723-6020.

All documents available for public review are on file with the City Clerk Department.

CITY OF LANCASTER, CALIFORNIA

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE ENERGY AUTHORITY

REGULAR MEETING AGENDA
TUESDAY, 05/24/2022
~ 14 ~
9 1
7 Date: May 24, 2022

STAFF REPORT
Lancaster Housing Authority
To: Housing Authority Members
From: Jeff Hogan, Senior Director – Development Services Chenin Dow, Senior Manager – Real Estate & Economic Development Christopher Aune, Housing Manager – Real Estate & Economic Development Subject:Residential Purchase Agreement and Joint Escrow Instructions for the sale of 45534 5th Street East to Cesar Elias and Santiago Elias Recommendation:

1. Adopt Resolution No. HA 2-22, approving a Residential Purchase Agreement and Joint Escrow Instructions for the sale of 45534 5th Street East, accepting the Health and Safety Code Section 33433 Report, and making certain findings pursuant to Health and Safety Code 33433.

2. Authorize the City Manager or his designee to execute all related documents.

Fiscal Impact:

Approval of the agreement would provide for revenue ($376,483.00±) to the Low Moderate-Income Housing Asset Fund (LMIHAF) account number 306-3606-100. The amount of revenue would be the effective purchase price of $410,000.00, minus commissions, report costs, and other smaller costs that are deducted from the purchase price at the close of escrow.

Background:

On August 14, 2007, the Agency Board approved the implementation of the Neighborhood Foreclosure Preservation Home Ownership Program (the “Program”) citywide. The goal of the Program was to reclaim vacant, abandoned properties for affordable housing, strengthen blocks and neighborhoods by eliminating the blighting effects of vacant properties, and enforce the city codes and city building code requirements. The Program was designed to preserve sustainable homeownership for Lancaster residents by reclaiming foreclosed homes as neighborhood assets.

In 2007, the Former Redevelopment Agency purchased 45534 5th Street East and rehabilitated the house under the Foreclosure Program to help offset the impact resulting from foreclosures on the local real estate and housing market.

On July 28, 2009, the City Council and Agency Board Members approved a disposition strategy for properties acquired by the Lancaster Redevelopment Agency Under the Piute Mater Vision Plan.

The property located at 45534 5th Street East is included in that disposition strategy.

HA NB 1
5/24/22
JC
9 1
7 In 2010, the City of Lancaster created its second community Wellness Home located at 45534 5th Street East. The new Piute Wellness Home was designed to provide neighborhood residents access to pertinent wellness information, as well as a variety of health-related services.

Meanwhile, on January 24, 2012, the Lancaster City Council, adopted Resolution 12-08 assigning the housing functions of the former Lancaster Redevelopment Agency to the Lancaster Housing Authority.

Eventually, due to changing needs, the services for the Wellness Home located at 45534 5th Street East were consolidated at other locations. The home has remained vacant for the past several years.

In May 2021, the City advertised a Request for Qualifications for real estate brokerage services. On July 27, 2021, the City Council selected (4) brokerages to place on a pre-qualified list. Coldwell Banker Commercial A Hartwig Company was on the pre-qualified list and Dennis Greer, was selected to represent the City in the sale of 45534 5th Street East. Mr. Greer proceeded to market the property and received offers for its purchase.

The City had originally received two offers and one applicant has stopped responding. The remaining offer came from Cesar Elias and Santiago Elias (“Buyers”).

Analysis:

The purchase information for this offer is as follows:

Listing Price $390,000
Offer Price $410,000
Credit Request $10,000
Effective Purchase Price $400,000
Difference from Listing Price $10,000
Loan Type FHA
Down Payment 3.5%
Escrow Period 35
Occupancy Type Owner-Occupied
Closing Costs $28,557.50
Estimated Net at Close $376,483.00
The Buyer has provided in the purchase agreement that this house will be their primary residence, making the home owner-occupied.

Environmental Review:

Approval of the purchase agreement is exempt from the California Environmental Quality Act (CEQA) as it does not constitute a project pursuant to Section 15378 of the CEQA Guidelines. The agreement proposes the sale and transfer of the home and does not disturb or impact the physical environment. 9 1
7 CA/sm
Attachments:

Resolution No. HA 2-22
Exhibit A: Health and Safety Code 33433 Report
Exhibit B: Residential Purchase Agreement and Joint Escrow Instructions RESOLUTION NO.

HA 2-22

A RESOLUTION OF THE HOUSING AUTHORITY OF THE

CITY OF LANCASTER APPROVING THE RESIDENTIAL

PURCHASE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS FOR THE SALE OF 45534 5TH STREET EAST

TO CESAR ELIAS AND SANTIAGO ELIAS
WHEREAS, California Health and Safety Code Sections 33334.2 and 33334.6 formerly authorized and directed the Lancaster Redevelopment Agency (“Redevelopment Agency”) to expend a certain percentage of all taxes which are allocated to the Redevelopment Agency pursuant to Section 33670 of the California Health and Safety Code for the purposes of increasing, improving and preserving the community’s supply of low- and moderate-income housing available at affordable housing cost to persons and families of low- and moderate-income, lower-income, and very low- income; and
WHEREAS, pursuant to applicable law, the Redevelopment Agency established a Low- and Moderate-Income Housing Fund (“Housing Fund”) and acquired the certain property with the purpose of using such property for the provision of affordable housing development opportunities; and
WHEREAS, by ABx1 26 enacted by the California Legislature during 2011 (“2011 Dissolution Act”), the California Legislature disbanded all redevelopment agencies within the State of California effective as of February 1, 2012, including without limitation the Redevelopment Agency; and
WHEREAS, the 2011 Dissolution Act provides, in part, that the host city of a redevelopment agency was to designate a housing entity to receive the housing assets of the former redevelopment agency within such city; and
WHEREAS, the City Council of the City of Lancaster (“City”) designated the Lancaster Housing Authority (“Authority”) as the housing entity to receive the housing assets of the former Redevelopment Agency; and
WHEREAS, the Housing Authority desires to enter into California Residential Purchase Agreement and Joint Escrow Instructions (the “Agreement”) in order to implement Health & Safety Code Sections 34200-34380 by providing for the sale of property located at 45534 5 th Street East, and which development of the Property is consistent with previous uses of the Property as well as existing uses of other real property in the surrounding neighborhood; and WHEREAS, the Agreement does not include affordable housing restrictions, the Project does not require voter approval under Article XXXIV of the State Constitution; and WHEREAS, the site’s status as a former Redevelopment property enables the City to follow redevelopment law’s disposition requirements for market-rate returns and exempts the City from the Surplus Land Act (AB 2135 & AB 1486); and
WHEREAS, the price to be received by the Authority under the Agreement is not less than the fair reuse value of the Site; and
WHEREAS, the Authority is authorized to dispose of interests in Site in the manner prescribed by the California Housing Authorities Law (Division 24, Part 2 of the California Health and Safety Code); and
WHEREAS, a joint public hearing of the Authority and City Council on the proposed Agreement was duly noticed; and
WHEREAS, the proposed Agreement, and a summary report substantially in the form described by Health and Safety Code Section 33433 (“Summary Report”), were available for public inspection prior to the joint public hearing; and
WHEREAS, on May 24, 2022, the governing board of the Authority and the City Council held a public hearing on the proposed Agreement, at which time the City Council and the Authority reviewed and evaluated all of the information, testimony, and evidence presented during the joint public hearing; and
WHEREAS, all actions required by all applicable law with respect to the proposed Agreement have been taken in an appropriate and timely manner; and WHEREAS, the Authority has reviewed the Summary Report and has evaluated other information provided to it pertaining to the findings proposed to be made hereunder; and WHEREAS, the City Council has previously determined, in its adoption of the ordinance approving the Redevelopment Project, that the Site is a portion of a blighted area, and is underutilized, as further set forth in the Implementation Plan as previously adopted and amended by the former Redevelopment Agency; and
WHEREAS, the Agreement does not create any new or additional environmental impacts or any environmental requirements applicable to the proposed use of the Property pursuant to the City’s Zoning Ordinance. The Agreement to dispose of the Property and the intended use of the real property is similar in nature to the previous uses of the Property. The use is permitted and is consistent with the General Plan land use designation. The proposed project is not expected to produce any significant impacts on the environment; and WHEREAS, the Authority and the City Council have duly considered all of the terms and conditions of the proposed Agreement and believe that the redevelopment of the Site pursuant to the Agreement is in the best interests of the City of Lancaster and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements.

NOW, THEREFORE, BE IT RESOLVED BY THE HOUSING AUTHORITY OF THE CITY OF LANCASTER, AS FOLLOWS:

Section 1. The Authority finds and determines that the statements set forth in the Recitals above are true, correct, and a substantive part of this Resolution.

Section 2. The Authority hereby determines that voter approval is not required by Article XXXIV of the State Constitution for the reasons set forth above. This Resolution is hereby deemed to constitute final approval of a proposal that may result in housing assistance benefiting persons of low income, within the meaning of Health and Safety Code Section 36005.

Section 3. The Authority finds and determines that, based upon substantial evidence provided in the record before it, the consideration for the Authority’s disposition of the Site pursuant to the terms and conditions of the Agreement is not less than the fair reuse value at the use and with the covenants and conditions and development costs authorized by the Agreement.

Section 4. The Authority hereby finds and determines that the Agreement is consistent with the provisions and goals of the Implementation Plan as previously adopted by the Redevelopment Agency.

Section 5. The Authority hereby approves the Agreement in substantially the form presented to the Authority, subject to such revisions as may be made by the City Manager or his designee. The City Manager is hereby authorized to execute the Agreement (including without limitation all attachments thereto) on behalf of the Authority. A copy of the Agreement when executed by the Authority shall be placed on file in the office of the Secretary of the Authority.

Section 6. The City Manager (or his designee) is hereby authorized, on behalf of the Authority, to make revisions to the Agreement which do not materially or substantially increase the Authority’s obligations thereunder or materially or substantially change the uses or development permitted on the Site, to sign all documents, to make all approvals and take all actions necessary or appropriate to carry out and implement the Agreement and to administer the Authority’s obligations, responsibilities, and duties to be performed under the Agreement and related documents.

Section 7. Approval of the Agreement is exempt from the California Environmental Quality Act (CEQA) as it does not constitute a project pursuant to Section 15378 of the CEQA Guidelines. The Agreement proposes the sale and transfer of the home and does not disturb or impact the physical environment. City staff has, therefore, determined that this project is not subject to additional environmental review.

Section 8. Severability. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications, and to this end, the provisions of this Resolution are declared to be severable.

Section 9. Effective Date. This Resolution shall become effective immediately.

Resolution No. 22-

Page 2 ends

PASSED, APPROVED, and ADOPTED this 24th day of May, 2022, by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

ATTEST: APPROVED:

ANDREA ALEXANDER, ER
City Clerk
Lancaster Housing Authority

KITY KIT SZETO
Chair
Lancaster Housing Authority

STATE OF CALIFORNIA

COUNTY OF LOS ANGELES

CITY OF LANCASTER
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) ss
)

CERTIFICATION OF RESOLUTION

LANCASTER HOUSING AUTHORITY
I, , City of Lancaster, California,
do hereby certify that this is a true and correct copy of the original Resolution No. HA 2-22 , for which the original is on file in my office.

WITNESS MY HAND AND THE SEAL OF THE CITY OF LANCASTER, on this 24th day of May 2022,
(seal)
INFORMATION SUMMARY (33433 REPORT)

FOR THE

SALE OF REAL PROPERTY

WITH PROPOSED HOMEBUYERS
This summary is prepared pursuant to Section 33433 of the California Health and Safety Code.

1. Background:

On July 28, 2009, the City Council and Agency Board Members approved a disposition strategy for properties acquired by the Lancaster Redevelopment Agency Under the Piute Mater Vision Plan. The property located at 45534 5 th Street East is included in that disposition strategy.

In 2010, the City of Lancaster created its second community Wellness Home located at 45534 5th Street East. The new Piute Wellness Home was designed to provide neighborhood residents access to pertinent wellness information, as well as a variety of health-related services.

Eventually, due to changing needs, the services for the Wellness Home located at 45534 5th Street East were consolidated at other locations. The home has remained vacant for the past several years.

Earlier this year, staff began receiving ongoing reports regarding vandalism to the house.

The staff recommended it would be in the best interest of the neighbors and the City to sell the home and have it occupied immediately.

2. Cost of the Project to the former Agency/Authority:

The total acquisition price was $202,500.

Improvement costs to the project home included substantial rehabilitation including drought- tolerant landscaping, energy-efficient dual paned windows, and energy-efficient appliances.

Property rehabilitation costs were approximately $108,773 The total cost to the former Agency and the Authority is approximately $311,273.

3. Estimated value of interest to be conveyed at the highest and best use permitted by the Redevelopment Plan:

The estimated value of the interest to be conveyed is $390,000, which is based on an independent appraisal.

4. The estimated value of interest to be conveyed at the use and with the conditions, covenants, and restrictions required by the transfer of the property:

The property will be sold at a market rate without affordability covenants. Proceeds will be deposited in the LMIHAF account. and provide leverage for future permanent affordable housing projects.

5. The acquisition price which the homebuyer will be required to pay for the Real Property Transfer Agreement:

The homebuyer will receive title to the property subject to the terms and conditions as outlined within the Sale Agreement. The disposition price of this property is approximately $390,000 .

6. Explanation as to the reason why the sale of the Site will assist in the elimination of blight:

The Foreclosure Rehabilitation Program preserved housing and removed blight in the City's mature neighborhoods through substantial rehabilitation. Without encouraging homeownership, the value attributed to the land as a resource would otherwise experience conditions of physical deterioration and blight due to poor use of the property, squatting, and illegal dumping.

Authentisign D4AB8.c80B57Ft7Dst
C.\LIFORNIA
.\SSOCIATION

OF REALTORSO
FHAruA Amendatory Glause
(C.A.R. Form FVAC, Revised 12121)
This is an addendum to the Purchase Agreement, OR ! Otner dated 04/25/2022 , on property known as
("Agreement"),
45534 E 5th Street, Lancaster, CA 93535
Cesar Elias. Santiaao Elias
("Property"),
("Buyef'),
("Selle/').
between
and Owner of Record
Buyer and Seller are referred to as the "Parties"

1. "lt is expressly agreed that notwithstanding any other provisions of this contract, the purchaser shall not be obligated to complete the purchase of the property described herein or to incur any penalty by forfeiture of earnest money deposits or otherwise unless the purchaser has been given in accordance with HUD/FHA or VA requirements a written statement by the Federal Housing Commissioner, Department of Veterans Affairs, or a Direct Endorsement lender setting forth the appraised value of the property of not less than $ 410,000.00 . The purchaser shall have the privilege and option of proceeding with consummation of the contract without regard to the amount of the appraised valuation. The appraised valuation is arrived at to determine the maximum mortgage the Department of Housing and Urban Development will insure or Department of Veterans Affairs will guaranty. Neither HUD or VA warrant the value or the condition of the property. The purchaser should satisfy himself/herself that the price and condition of the property are acceptable."
lf, after signing this Amendatory Clause, the purchase price increases, Buyer and Seller agree to sign, before Close Of Escrow, a new amendatory clause that reflects the final purchase price agreed to by Buyer and Seller.

For FHA transactions, the Amendatory Clause is not required on HUD REO sales, sales where the seller is Fannie Mae, Freddie Mac, the Department of Veterans Affairs, Rural Housing Services, other Federal, State and local government agencies, mortgagees disposing of REO assets, or sellers at foreclosure sales and those sales where the borrower will not be an owner-occupant (e.9., sales to nonprofit agencies).

2. CERTIFICATION: The undersigned Buyer, Seller, and real estate agent(s) or broker(s) hereby certify that the terms and conditions of the sales contract referenced above are true to the best of their knowledge and belief and that any other agreement entered into by any of the parties in connection with the real estate transaction is part of, or attached to, the sales agreement.

WARNING: lt is a crime to knowingly make false statements to the United States on this or any other similar form.

Penalties can include fine, imprisonment, or both. Title 18 U.S. Code S 1001 et seq.

By signing below, the undersigned acknowledge that each has read, understands and has received a copy of this Am lause-
Buyer
Buyer
€Ua,J Cesar E/ias Date 04t25t2o22
Elias Date 04t2512022
Seller X
4t25t2022 9".39'.57 PM GMT Owner of Record Date
Seller Date
Renwick Properties DRE Lic. # 01200081
Date *,ffiMelik Olivier DRE Lic.# 02102346
Adfuep440l.q,cf.6aGt.$le B2ta city Palmdale State CA Zip 93550-7611 Telepho ne (6611917-1829 Fax Em ail m e I i ko I iv i e r23 @q m a i L c o m Seller's Real Estate Broker Coldwell Banker-A Hartuvio Co. DRE Lic. # 00450461 By Dennis Greer DRE Lic. # 00758955 Date
Address 43912 N. 20th Sf. Wesf City Lancaster State CA Zip 93534 Telephone (661) 948-8424x319 Fax (661)942-5971 Em ail s ree rc o m m @.e a rth I i n k. n et @ 2021, Califomia Association of REALTORS@, lnc. United States copyright law Oitle 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 .qssociation of REALTORS@. lt 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 CALTFORNTA ASSOCIATION OF REALIORS@ 525 South Virgil Avenue, Los Angeles, Califomia 90020
FVAC REVISED 12t21(PAGE r OF 1)
FHA/VA Clause PAGE 1 1
Renwick Properties, 190 Si€rra Ct. Ste 8206 Palmdale CA 93550 Phone:

Melik Olivier Produced with Lone Wolf Transactions (zipFom Edition) 717 N Haruood St, Suite 2200, (66\a6Ms77
Dallas, TX 75201
Fax:
wW.lwolf.com
Cesar Elias

DISCLOSURE REGARDING

REAL ESTATE AGENCY RELATIONSHIP
(As required by the Civil Code)
(C.A.R. Form AD, Revised 12121)
! 1tt cfreckeO) This form is being provided in connection with a transaction for a leasehold interest exceeding one year as per Civil Code section 2079.130), (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 Selleds agent under a listing agreement with the Seller acts as the agent for the Seller only. A Selleis 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, orwithin the diligent attention and observation of, the parties. An agent is not obligated to reveal to eitherparty any confidential information obtained from the other party that does not involve the affirmative duties set forth above.

BUYER'S AGENT
A Buyeds agent can, with a Buyer's consent, agree to act as agent for the Buyer only. ln 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, orwithin 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. ln 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. ln 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. lf legal or tax advice is desired, consult a competent professional. lf 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 orwithin 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. l/WE ACKNOWLEDGE RECEIPT OF A COPY OF THIS DISCLOSURE AND THE PORTIONS OF THE CIVIL ON THE SECOND PAGE.
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Elrbs Date
04t25t2o22
DRE Lic. # 01200081
By JlLnlih 0htiet{
Rear Estate Broker (Firm)
DRE Lic. # 02102346 Date
04t25t2?22
4t25tzo22 9:45:37 p(Fdpff erson or Broker-Associate, if any) @ 2021, California Association of REALTORS@, lnc.

AD REVISED',t2t21(PAGEl OF 2l
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C,\I-IFORNIA
.{SSOCIATION
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RE REAL AGENCY RELA HIP 1 2
Renwick Properties, 190 Sierm Ct. Ste 8206 Palmdale CA 93550 Phone: (661) t604571 Fax:

Melik olivier Prcduced with Lone Wolf TEnsactions (zipFom Edition) 7'17 N Haruood St, Suite 2200, Dallas, TX 75201 ww.kdtcom Cesrr Elis
Authentisisn rD:2E766Are-B3cF481D-eAqg-f;99E5(t{rPfl
--cTloNS 2079.13 - 2079.24 (2079.16 APPEARS ON THE FRONT) 2079.13. As used in Sections 2079.7 and 2079.141o2079?4, 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 redl properf transaction, and includes a person who is licensed as a real estate broker under Chapter 3 (commencing with Sec{ion 10130) of Part I 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 ofthe agent. When a salesperson or brokeiassociate ovves 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 th6 brokei fbr wtiom the salesperson or broker associate functions. (b) "Buyef' means a transferee in a rehl property transaction, ahd includes a ferson raho executes an offer to. purchase. real propgrty from a seller through an agent, or wfio seeks the seMces 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) "Commeriial nial properfy" meand all real property in the gtate, glcept (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 iand, or (5) a recreational vehicle,-as defined in Section 799.29. (d)-"Dual agent" means €n 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 authoiized to sell the real-property or to find or obtain a buyer, including rendering other seMces 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 comp6nsation. (g) "Li$ing price" !s 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 pdce" is the amount expressed in dollars specified in an ofier 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. (i) "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 ofier to purchase. (l) "Sell," "sale," or "sold" refers to a transaction for the transfer of real property fom 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 yeais duration. (m) "Selle/' means the transferor in a real propefi 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 fom an agent on behalf of another. "Selle/' includes both a vendor and a lessor of real property. (n) "Buyefs agent' means an agent wtro 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 selleds agent, if any, shall provide the disclosure form to the seller prior to entering into the listing agreement. (b) The buyeds agent shall provide the disclosure form to the buyer as soon as practicable prior to execution of the buyeds offer to purchase. lf the offer to purchase is not prepared by the buye/s agent, the buyefs 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. ln 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 I of this AD form.
2079.17(al 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 propefi 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, respec{ively. {b) As soon as practicable, the sellefs agent shall disclose to the seller whether the seller's agent is acting in the real propefi transadion 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 selle/s agent prior to or coincident with the execution of that contrac't by the seller.

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

Selle/s Brokerage Firm License Number_
ls the broker of (check one): the seller; or
Seller's License Number
(dual agent)
License Number
ls (check one) the Seller's Agent. (salesperson or broker associate) both the Buyer's and Seller's Agent.

Buye/s Brokerage Firm
ls the broker of (check one): ! the buyer; or l l botn the buyer and seller. (dual agent) Buyeds Agent COMPLETE. SAMPLE ONLY License Number_
the act wtrich 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, Calilomia Association of REALTORS@, lnc. 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 lS l\ilADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION lN 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@. lt is not intended to identify the user as a REALTOR@. REALTOR@ is a registered collective membership mark which may be used only by of the NATIONAL ASSOCIATION OF REALTORS@ who subscribe to its Code of Ethics.

DO NOT COMPLETE. SAMPLE ONLY
Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the CALIFORNIA ASSOCIAIION OF REALIORS@ 525 South Virgil Avenue, Los Angeles, Califomia 90020
AD REVTSED 12t21(PAGE2OF 2l
DISCLOSURE REGARDING REAL ESTATE AGENCY RELATIONSHIP (AD PAGE 2OF 2I Produced with Lone Wolf Transactions (zipFom Edition) 717 N HaMood St, Suite 2200, Dallas, TX 75201 !4!44j!!glleo!D Cesar Eli6 both
D-9AB8C80B57Ft7Dst

FAIR HOUSING & DISCRIMINATION ADVISORY
(G.A.R. Form FHDA, 10/20)
.\ssoclr{Tto\
oF RE-{LToRS&

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 Vlll of the Civil Rights Act; 42 U.S.C. SS 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") SS12900- 12996,12955; 2 California Code of Regulations ('CCR") SS12005-12271; 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 W|TH DISABILITIES ACT ('ADA') 42 U.S.C. SS12181-12189; Title lll of the ADA prohibits discrimination based on disability in public accommodations; and
E. OTHER FAIR HOUSING LAWS: Section 504 of Rehabilitation Act of 1973 29 U.S.C. $794; Ralph Civil Rights Act CC S51.7.; California Disabled Persons Act; CC $554-55.32; 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/CHARACTERISTIGS: Whether specified in Federal or State law or both, discrimination against persons if based on that person's belonging to, association with, or perceived membership to, any of the following classes or categories is

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 52725(0 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 S10177(lX1); 10 CCR 52780

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, handicap, familial status, national origin, sexual orientation, or gender identity by REALTORS@.

7. WHO IS REQUIRED TO COMPLYWITH 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. o Sellers o Landlords o Sublessors
o Real estate licensees o Real estate brokerage firms r Property managers o Mobilehome parks o Homeowners Associations ("HOAs"); o Banks and Mortgage lenders . lnsurance companies . Government housing services

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 eldedy 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 concem 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; @ 2020, Califomia Association of REALTORS@, lnc.

FHDA lo/20 (PAGE 1 OF 2)

FAIR HOUSING & DISCRIMINATION ADVISORY
Religion
Gender Expression
Medical Condition
Age
Gender ldentity
Disability (Mental &
Physical)
MilitaryA/eteran Status
National Origin
Any arbitrary characteristic
Ancestry
Gender
Source of lncome (e.9.,
Section I Voucher)
lmmigration Status
Color
Sexual Orientation
Familial Status (family with a
child or children under 18)
Primary Language
Race
Sex
Marital Status
Citizenship
Criminal History (non-relevant convictions)
Retrwick Propefrid, 190 Sier. Ct Ste B-m6 Pa.lmdale CA 93550 Phone: (661) t6(H577 Melik Otivier Prcduced with Lone Wolf TEnsaclions (zipForm Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 Fax:
w.lwdlmm
Ceser Elirs
ElOF
Authentisign lD: 2Fl66A1 9a3CF-{al D-9AB8480B57Fi 7D5l
E. lnquiring 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 govemment 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;
l. 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 wheel chair bound tenant to install, at their expense, a ramp over front or rear steps, or refusing to allow a physically disabled tenant 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.

IO. 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 buye/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: lf 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://www.dfeh.ca.gov/housing/
C. Local: local Fair Housing Council office (non-profit, free service) D. DRE : hft ps ://www.d re.ca.gov/Cons umers/FileGom plaint.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 penson 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 1 866 prohibit discrimination based on race; the FHA and FEHA exemptions do not extend to discrimination based on race.

Buyer/Tenant
Buyer/Tenant
read, understand and acknowledge receipt of a copy of this Fair Housing & Discrimination Advisory Date
04/25t2022
Buyer/Tenant Elias Date
o4/25t2022
Seller/Land 412512022 9:39:30 PM GMT Owner of Record Date DateSeller/Landlord
any portion thereof, by photoopy machine or any other means, induding facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE CALIFORNIA ASSOCIATION OF REALTORS@. NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDIry OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION. A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TMNSACTIONS. IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL. This form is made available to real esiate professionals through an agreement with or purchase from the Califomia Association of REALTORS@. It is not intended to identiry the user as a REALTOR@. REALTOR@ is a registered mllective 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 CALTFORN/A ASSOCIATION OF REALTORS@ 525 Souih Virgil Avenue, Los Angeles, California 90020
FHDA 10/20 (PAGE 2OF 2l
FA|R HOUSTNG & D|SCRIMINATION ADVISORY (FHDA PAGE 2OF 2l Producedwith Lone Wolf Transactions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 w.kdf.com Ceser Elies ^**'f$iig,1,i;* possrB
-€
oFRE:\LroRSs

LE REPRESENTATION OF MORE THAN ONE BUYER
OR SELLER. DISCLOSURE AND CONSENT
(C.A.R. Form PRBS, Revised l2121)
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: lf 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. lf 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. ln 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. \Mrether 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 underctanding this Possible Representation of More Than One Buyer or Seller - Disclosure and Consent and agrees to the agency possibilities disclosed.

Seller X Owner of Record Date
Seller
Buyer
Buyer
Date
Cesar Ellas Date 04t25/2022
Efibs Date 04t25t2022
By
04D5t2022
PM GMT
Seller's Brokerage Firm Coldwell Banker-A Harttailq Co. DRE Lic # 00450461 Date By DRE Lic # 00758955 Date
Dennis Greer
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 REALTORSO, 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@. lt 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 REALIORS@ 525 South Virqil Avenue, Los Angeles, Califomia 90020
PRBS REVISED 12t21(PAGE 1 OF 1)
DRE Lic # 01200081 Date
DRE Lic # 02102346 Date
m
ReNick Properties, 19O Siera Ct. Sie E.m6 Palmdal€ CA 93550 Phone: (661) t60-45?1 Fax:

MelikOlivier Produ@dwithLoneWolfTransactions(zipFomEdition)717NHaruoodSt,Suite2200,Dallas,TX 75201 w.Nof.com Cesar Elias
POSSIBLE RE ENTATION OF MORE THAN ONE BUYER OR SELLER RBS PAGE 1 OF 1 Authentisign D-9A88€80857F17D5 1

CALIFORNIA

ASSOCIATION
OF REALTORSo

WIRE FRAUD AND ELECTRONIG FUNDS

TRANSFER ADVISORY
(C.A.R. Form WFA, Revised 12121)
Property Address: 45534 E 5th Street, Lancaster, CA 93535 ("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. lt also appears that some hackers were able to provide false phone numbers for verifying the wiring or funds transfer instructions. ln 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, Propefi 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. lf 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 lnvestigation: https://www.fbi.gov/; the FBI's lC3 at www.ic3.gov; or 3'10-477-6565 National Wh ite Collar Cri me 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 Electronic Funds Transfer Advisory.

Buyer/T enantX ehe6 Cesar E/ias Date
o4t25t2o22
Buyer/T enantX Date 04t25t2022
Seller/Land 4nSl2O22 9:39:33 PM GMT Owner of Record Date Seller/Landlord Date
@2021, California Association of REALTORS@, lnc. United States copyright law (Title 17 U.S. Code) forbids the unauthorized distribution, display and reprcduction of this form, or any portion thereof, by photocopy machine or any other means, including faeimile 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@. lt 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 ASSOC/AIION OF REALIORS@ 525 South Virgil Avenue, Los Angeles, Califomia 90020
wFA REVTSED 12t2't (PAGE I OF 1)
I
c
WIRE NDS TRANSFER ADVISORY PAGE 1 OF 1
Renwick Prcpeftid, 190 Siera Ct. Ste 820,6 Palmdale CA 93550 Phone: (661) t60-4577 Metik Otivier Produced with Lon€ Wolf Transastions (zipFom Edition) 71 7 N Haruood St, Suite 2200, Dallas, TX 75201 Fax:

M.lwolf.com
Cesar Elias
Authentisign D-9AB8€80857Ft7D51

CALIFORNIA

ASSOCIATION
OF REALTORS@
Date Prepared Aoril 25- 2O22

1. OFFER:

A. THIS IS AN OFFER FROM
2 3.
(Zip Code),
Assessor's Parcel No(s). 3176-012-006 ("Property").
(Postal/Mailing
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.

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. Buye/s Agent is not legally required to give to Selle/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 Coldwell Banker-A Hartwig Co. License Number 00450461 ls the broker of (check one): ! the Seller; or ! both the Buyer and Seller (Dual Agent).

Selleds Agent Dennis Greer License Number 00758955
ls (check one): ! the Seller's Agent. (Salesperson or broker associate); or I both the Buyeis and Seller's Agent (Dual Agent).

Buyer's Brokerage Firm Renwick License Number 01200081
ls the broker of (check one): the Buyer; or both the Buyer and Seller (Dual Agent).

B. THE PROPERTY to be acquired is
in Lancaster
Buye/s Agent
ls (check one)

CALIFORNIA RESIDENTIAL PURCHASE AGREEMENT

AND JOINT ESCROW INSTRUCTIONS
(c.A.R. FORM RPA, rZ21)
Cesar Elias, Santiaqo Elias ("Buyef ).
45534 E 5th Street , situated
(City), Los Anoeles (County), California, 93535
Buyer's lnitials Seller's lnitials X _______J
Melik Olivier License Number 02102346
the Buyefs Agent. (Salesperson or broker associate); or both the Buyer's and Selle/s Agent (Dual Agent) C. ! Utore than one Brokerage represents ! Selter, ! euyer. See, Additional BrokerAcknowledgement (C.A.R. Form ABA).

D. pOfenfnllY GOMPETING 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).

TERMS OF PURCHASE AND ALLOCATION OF COSTS: The items in this paragraph are contractual terms of the Agreement. further on. This form is 16 The Parties are advised to read all 16 @2o21, Calrtomia Association of REALTORS@, lnc.

RPA12121(PAGE r OF 16)
lAt cash
Uoon removal of all continoencies
ohn - (oate)
oR!
Conventional or, if checked,

EFHANVA
(QAR Forms FVAC, HID attached)
l__l Seller Financing
l__l other:

Seller Financing
Other:
or, if checked,
$ 410,Un.N
Fss
-OR-onn
Days afier Acceptance
-
(date)
3 calendar days after all Buyer
at SPM or_ l_lAM/Ll PM
or
L_A.S % of purchase price)
(% number above is for calculation purposes
and is not a contractual term)
$ 2.000.00
$_
(o/o number above is for calculation purposes
and is not a contractual term)
$395,650.0{, ( 96.5 "/. ofpurchaseprice)
Fix€d ra-ie oilTnitfal adjustable rate not lo
exceed _%
Buyerto pay zero points or up to % ofthe
loan amount
17 (or ) Days afierAcceptance
$
-
( lo of purchase price)
Fixed rate or ! lnitial adjustable rate not to
exceed Yo
Buyer to pay zero points or up to % of the
loan amount
Primary, or if checked, ! Secondary Il lnvestment
$ 12,350.N
saoolwoo -
Additional Financed Amount
lnterest Rate
Points
Occupancy Type
Balance of Down Payment
Purchase Price
Close of Escrow (GOE)
Expiration of Ofter
Inltaal Deposit Amount
! lncreased Deposit
(Money placed into escrow after
the initial deposit, Use form DID at
time increased deposit is made,)
lf FHA or VA checked, Deliver list of
lender required repairs
Loan Amount(s):

Points
First
lnterest Rate
5, 58 (cash)
32A'
5A(1)
5A(2)
5C(1)
5C(2)
7A
5D
A
B
c
D(1)
D(2)
E(1)
E(2)
E(3)
F

PURCHASE PRICE TOTAL
PAGE 1 OF 1CALIFORNIA RESI AGREEMENT AND JOINT ESCROW INSTRUCTIONS ReNick Properlis, 190
Melik Olivier
Ste 8206 Palmd.Ie CA 9359)
Produced wilh Lone Vl/olf Transadions
(651) r604s7?
Dallas, TX 75201
Cenr Eli.s
717 N HaMood
Fax:Phone:

Suite
RPA't2t21(PAGE 2 OF 16) Buyer's lnitials
Date 2022
Seller's lnitials
CALIFORNIA RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 2 OF 15) Produced with Lone Wolf Transactions (zipFom Edition) 717 N HaMood St, Suite 2200, Dallas, TX 75201 w.lwoli@m Cesar Elias Seller credit to be applied to closing
costs OR
I other:

Prequalifi cation I Preapproval
Fully underwritten preapproval
! No loan contingency
! No appraisal contingency
Removal of appraisal contingency
does not eliminate appraisal
cancellation rights in FVAC.

REMOVAL OR WAIVER OF
CONTINGENCY:

Any contingency in L(l)-L(7) may be
removed or waived by checking the
applicable box above or attaching a
Contingency Removal (C.A.R. Form
CR) and checking the applicable
box therein. Removal or Waiver at
time of offer is against Agent advice.

See paragraph 8H.
! cR attached
C.A.R. Form SIP attached if 29 or
fewer days. C.A.R. Form RLAS
attached if 30 or more days.

TOPA oroccupied
Other
tenant
1 7 (or ) Days after Acceptance, or 5 Days
after receipt, whichever is later
Upon notice of recordation, OR l6 PM or
L l AM/ L l PM on date specified. as
applicable, in 3M(2) or attached TOPA.

COE date or, if checked below,
- days after COE (29 or fewer days)
]- oays afier CoE (30 or more days)
See Tenant Occupied Property Addendum
(C.A.R. form TOPA)
7 (or ) Days after Acceptance
5 (or ) Days after receipt
3 (or ) Days after Acceptance
7 (or ) Days afierAcceptance
3 Days after Acceptance
and is not a contractual term)
8S to.soo.oo (_2.6_% of purchase price)
(o/o number above is for calculation purposes
Attached to the offer or ! 3 (or ) Days
after Acceptance
Attached to the offer or! 3 (or ) Days
after Acceptance
Attached to the offer or!3 (or ) Days
after Acceptance
5 (or ) Days prior to COE
17 (or ) Days after Acceptance
17 (or ) Days afterAcceptance
17 (or ) Days afterAcceptance
17 (or ) Days afterAcceptance
17 (or ) Days afterAcceptance, or5 Days
after receipt, whichever is later
17 (or ) Days after Acceptance, or 5 Days
after receipt, whichever is later
17 (or ) Days after Acceptance, or 5 Days
after receipt, wiichever is later
Seller Credit, if any, to Buyer
Verification of All Cash (sufficient
funds)
Verification of Down Payment and
Closing Costs
Verification of Loan Application
Final Verification of Condition
Assignment Request
Loan(s)
Appraisal: Appraisal contingency
based upon appraised value at a
minimum of purchase price or
xls 4lO.OOO.OO
lnvestigation of Property
lnformational Access to Property 17 (or \ Days afierAcceptance Buyer's right to access the Property for informational purposes is NOT a contingency does NOT create cancellation rights, and applies even if contingencies are removed.

Review of Seller Documents
Preliminary ('Title") Report
Common lnterest Disclosures
required by Civil Code S 4525 or this
Agreement
Review of leased or liened items
(Such as for solar panels or propane
tanks or PACE or HERO liens)
Sale of Buyer's Property
Sale of Buyer's property is not a
contingency, UNLESS checked here:
r__l c.A.R. Form COP attached
Time of Possession
Seller Occupied or Vacant units
Tenant Occupied units
Seller Delivery of Documents
Sign and return Escrow Holder
Provisions and lnstructions
Time to pay fees for ordering HOA
Documents
lnstall smoke alarm(s), CO detector(s).
water heater bracing
Evidence of representative authority
5E
ADDITIONAL FINANCE TERMS:
5B
8D. t4A
8E, 13A
8F,11K
8G, eB(6)
8J
7C
144
198
11K(2)
108(1)
28 6A
6B
16 23
8A
8B
8C,',t2
N(3)
N(4)
N(5)
G(l)
G(2)
H(1)
H(2)
J
H(3)
L(1)
K
.

L(2)
L(3)
L(4)
L(5)
L(6)
L(7)
M(1)
L(8)
ffi
M(2)
N({)
M(3)
N(2)
CA
Buyels lnitials
et st
Date'. Aoril 25.2022
Seller's lnitialsRPA12t21(PAGE 3 OF 16)
cALtFORNtA RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 3 OF 16) Produ@d with Lone Wolf Transactions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 @lydfueB Cew Elias Escrow Holder:

SellersChoice
Title Company (lf different
ftom Escrow Holder):

Se/lers Choice
Unless Otheruvise Agreed, Buyer
shall purchase any title insurance
policy insuring Buyer's lender.

Unless Othenryise Agreed, Seller
shall pay for separate HOA move-
out fee and Buyer shall pay for
separate move-in fee. Applies if
separately billed or itemized with
cost in transfer fee.

Sellers Chorce! Provided by:

Environmental
Other
!euyer [|setter !aotr
!Buyer !setter !eotr
!Buyer [|setter !sotn
!Buyer []setter !eotn
! auyer I setter ! aotn
! eacn to pay their own fees
Bolh Each to Pay Own Pofti!auyer lsetter ffi
!Buyer Isetter !eotn
Buyer
IBuyer Isetter !eotn
Iauyer !setter !aotn
Seller
Buyer
! euyer ! setter ! aotn
Seller, or if checked, ! euyer ! eotn
Both $499I euyer ! setter !
!suyer !seiler !aotn
Items lncluded - All items specified in Paragraph 98 are included and the following, if checked separate video doorbell and camera
equipment;
Smart home control devices;
Wall mounted brackets for video or audio
equipment;
IAbove-ground pool(s) /! spa(s);
fi Bathroom minors, unless
excluded below;
! Electric car charging systems
and stations;
! PotteO trees/shrubs;
Tft
Security camera equipment;
Security system(s)/alarm(s), other than
Dishwashe(s)
Microwave(s);
Video doorbell(s);
Additional ltems included:
! Stove(s), oven(s), stove/oven
combo(s);
Refrigerator(s);
Wne Refigerator(s);
Washer(s);
Dryer(s);
Excluded ltems:

Natural Hazard Zone Disclosure
Report, including tax information
See Tert Overflow Report
Report
Smoke alarms, CO detectors, water
heater bracinq
Govemment Required Point of Sale
inspections, reports
Government Required Point of Sale
corrective/remed ial actions
Escrow Fees
Owne/s title insurance policy
Buyer's Lender title insurance policy
County transfer tax, fees
City transfer tax, fees
HOA fee for preparing disclosures
HOA certification fee
HOA transfer fees
Private transfer fees
TC Fee Renwick Properti fees or costs
fees or costs
Cost not to exceed $ 525.00Home wananty plan: Seller's10c Serrers Ctror?elssued by:
fl Buver ltr setter fl Both
I auyer w-ives home wananty plan
I
I
10A,11A
10B(1)
10A
108(2)
108(2)(A)
19B
13 't1K(2)
P(1)
P(2)
a(1)
a(2)
a(3)
o(4)
a(5)
a(6)
aF)
a(8)
a(e)
o(r0)
a({r)
a(r2)
o(13)
o(14)
o(1s)
o({6}
a(r7)
a({8)
R
- ..:-'':: . i'.r.-:l:'
Aut'enlisi{Jpgi ?F7AQA1?i93S|4S93ABE98E5S.98€1.'ancasrer CA 93535

4. PROPERTY ADDENDA AND ADVISORIES: (check allthat 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) Manufactured Home Purchase Addendum (C.A.R. Form MH-PA) Tenant Occupied Property Addendum (C.A.R. Form TOPA) (Should be checked whether current tenants will remain or not.) Tenancy in Common Purchase Addendum (C.A.R. Form TIC-PA) Stock Cooperative Purchase Addendum (C.A.R. Form COOP-PA) Other
B. OTHER ADDENDA: This Agreement is subject to the terms contained in the Addenda checked below:

Addendum # (C.A.R. Form ADM) Short Sale Addendum (C.A.R. Form SSA) Court Confirmation Addendum (C.A.R. Form CCA)Back Up OfferAddendum (C.A.R. Form BUO) Septic, Well, Property Monument and Propane Addendum R. Form SWPI) Buyer lntent to Exchange Addendum (C.A.R. Form BXA) Seller lntent to Exchange Addendum (C.A.R. Form SXA) Other Other
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.)
Dale: April25.2022
trtr
Buye/s lnvestigation Advisory (C.A.R. Form BIA)
Wire Fraud Advisory (C.A.R. Form WFA)
Wildfire Disaster Advisory (C.A.R- Form WFDA)
Trust Advisory (C.A.R. Form TA)
REO Advisory (C.A.R. Form REO)
Other
Fair Housing and Discrimination Advisory (C.A.R. Form FHDA) Cal. Consumer Privacy Act Advisory (C.A.R. Form CCPA)
(Parties may also receive a privacy disclosure from their own Agent.) Statewide Buyer and Seller Advisory (C.A.R. Form SBSA)
Short Sale lnformation and Advisory (C.A.R. Form SSIA)
Probate Advisory (C.A.R. Form PA)
Other

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

A. DEPOSIT:
(1) lNlTlAL DEPOSIT: Buyer shall deliver deposit directly to Escrow Holder. lf 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: lncreased deposit specified in paragraph 3D(2) is to be delivered to Escrow Holder in the same manner as the lnitial Deposit. lf 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 29, if initialed by all Parties or otherwise incorporated into this Agreementn specifies a remedy for Buyer's default. Buyer and Seller are advised to consult with a qualified California real estate attorney 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 fodh in the Civil Code.

B. ALL CASH OFFER: lf 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({), 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), or Other is checked in paragraph 3E(l).
(2) ADDITIONAL FINANCED AMOUNT: lf 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), 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 Buye/s loan specified in paragraph 3E, or any alternate loan Buyer pursues, whether or not a contingency of this Agreement. lf the contact information for Buyer's lende(s) is differenlJrom that provided under the terms of paragraph 68, Buyer shall Deliver the updated contact information within 1 Day of Seller s rgquest (4) FHA/VAI If FHA or VA is checked in paragraph 3E(l), a FHA /A amendatory clause (C.A.R. Form FVAC) shall be incorporated and Signed by all Parties. Buyershall, within the time specified in paragraph 3E(1), Deliverto Sellerwritten notice (C.A.R. FonnRR orAEA) (i) of any lender requirements that Buyer requests Seller to pay for or otherwise correct or (ii) that there are no lender requirements. Notwithstanding Selleis agreement that Buyer may obtain FHA or VA financing, Seller has no obligation to pay or satisfy any or all lender requirements unless agreed in writing.

D. BALANCE Of pURCHISE PRICE (DOWN PAYMENT, paragraph 3F) (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 as specified in paragraph 3G(l) or Otherwise Agreed, 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 ai Close Of Escrow. lf the total credit allowed by Buye/s lender ("LenderAllowable.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 Buye/s down payment and closing costs, within the time specified in paragraph 3H(2) may be made by Buyer or Buyer's lender or loan broker pursuant to Parggraph 68.

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, B_uyer is prequalified or preapproved for any NEW loan specifie{in paragr4ph 3E. lf any loan specified in paragraph 3E is an .,^,,,,T;'::;;ffi
'ihe
prequa *"il..:;":18fl;H*
:::;llT_,"he
n'ia oan*H
cALtFORNtA RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 4 OF id; Produced with Lone Wolf Transactions (zipFom Edition) 717 N HaMood St, Suite 2200, Dallas, TX 75201 w.lwdtcom Cesar Elias A,th*l'sicJugi?F7AQA3?93Sf{*lg34BE9l9?SElL$l."ncaster, cA 93535 Date: Aprit 25,2022 C. BUYER STATED FINANCING: Seller is relying on Buyer's representation of the type of financing specified (including, bu{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 Buye/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 38) even if based upon altemate 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 avaihbb financing.

B. CONDITION OF PROPERTY ON CLOSING:
(1) Unless Otherwise Agreed: (i) the Property shall be delivered "As-ls" 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. lf 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 considerc 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 lN POSSESSION AFTER CLOSE OF ESCROW: lf Seller has the right to remain in possession after Close Of Escrow pursuant to paragraph 3M(2) or as Othenarise 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 Buyeis 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 wananties. Agents cannot and will not determine the assignability of any wananties.

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 lnternet-connected devices included in the purchase price, garage door openers, and all items included in either paragraph 3P or paragraph 9. lf 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 Homeowners'Association ("HOA") to obtain keys to 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. lf contingent, Buyer shall act diligently and in good faith to obtain the designated loan(s). lf 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 puruant to the loan contingency if Buyer is otherwise qualified for the specified loan and Buyer is able to satisfy lende/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. Buyefs ability to obtain insurance for the Property, including fire insurance, is part of Buyer's lnvestigation of Property contingency. Failure of Buyer to obtain insurance may justify cancellation based on the lnvestigation contingency but not the loan contingency.
(3) Buye/s contraclual obligations regarding deposit, balance of down payment and closing costs are not contingencies of this Agreement, unless Otherwise Agreed.
(4) lf there is an appraisal contingency, removal of the loan contingency shall not be deemed removal of the appraisal contingency. (5) NO LOAN CONTINGENCY: lf "No loan contingency" is checked in paragraph 3L(1), obtaining any loan specified is NOT a contingency of this Agreement. lf 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 otherurise specified in paragraph 3L(2) or an attached GR form, c,ontingent 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 lnvestigation of Property contingency. The appraisal contingency is solely limited to the value determined by the appraisal.

Forany cancellation based upon this appraisal contingency, Buyershall Delivera Copy of thewritten appraisal to Seller, upon request by Seller.
(2) NO APPRAISAL CONTINGENGY: lf "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). lf Buyer is unable to obtain the loan specified solely for this reason, Seller may be entitled to Buyer's deposit or other legal remedies.

C. INVESTIGATION OF PROPERTY: This Agreement is, as specified in paragraph 3L(3), contingent upon Buyer's acceptance of the condition ol and any other matter affecting, the Property. See paragraph 12. n paragraph 3L(4), contingent upon Buyeis review of
RP Seller's lnitials
cALtFORNtA RESTDENTTAL PURCHASE AGREEMENT AND JOTNT ESCROW INSTRUCTIONS (RPA PAGE 5 OF 15) Produ@d with Lone Wolf Transactions (zipFom Edition) 717 N HaMmd St Suite 2200, Dallas, TX 75201 ww.lwdtem C6a Elis Aut'enlirisuBiff ?AQJs?8Egf fJ83aPEaJlEs$J/8Etr_ancasteacne3s3s E.. TITLE:

Dale: April 25.2022
(1 ) This Agreement is, as specified in paragraph 3L(5), contingent upon Buyer's ability to obtain the title policy provided for in paragraph 13G 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 (lF APPLICABLE): This Agreement is, as specified in paragraph 3L(6), contingent upon Buyer's review of Common lnterest Disclosures required by Civil Code $ 4525 and under paragraph 11K ('Cl Disclosures").

G. BUYER REVIEW OF LEASED OR LIENED ITEMS CONTINGENCYT 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 98(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. lf Buyer does remove a contingency without first receiving all required information from Seller, Buyer is relinquishing any contractual rights that apply to that contingency. lf 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 or 8, 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 receipt of Seller Documents or Cl Disclosures, whichever occurs later, remove the applicable contingency in writing or cancel this Agreement. (3) lf 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 Buyeds 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: ltems listed as included or excluded in the Multiple Listing Service (MLS), flyers, maketing 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 home 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 checked 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), 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 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 atthe time of Acceptance.

Note: lf 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 or other third party, the item should be listed as being excluded in paragraph 3P 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. lf checked in paragraph 3P, all such items are included in the sale, whether hard wired or not. (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 sal_e..Buyer is.advised to use paragiaph 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: lf checked ln paragraph 3P, all smart home and security system control devices are included in the sale, except for any non-dedicated personal computer, tablet, or phone used to control such features. Buyer acknowledges that a separate device and access to wifi or lnternet may be required to operate some smart home features and Buyer may have to obtain such device after Close Of Escrow. 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(l), shall (i) disclose to Buyer if any item or system specified in paragraph 3P or 98 or otherwise included in the sale is leased, or not owned by Seller, or is subject to any maintenance or other ongoing financjal obligation, or specifically gubject to a lien or other encumbrance or loan, anil (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.Othenrise 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 98(6), and (ii) are transferred without Seller warranty regardless of value. Seller shall cooperate with the identification of any software or applications and Buyeis efforts to transfer any services needed to operate any Smart Home Features or other items included in this Agreement, includirp; butrpt lipnted tq utilities or security systems. lefl ls€l 6RPA12I21(PAGE 6 OF 16) Buyer's lnitials x!-------Llx!-J Selleis lnitials x---------l 'cr;+riir CALIFORNIA RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 6 OF I6) Produced with Lone Wolf Transactions (zipFom Edition) 71 7 N Haruood St, Suite 2200, Dallas, TX 75201 uau6l[ggllfqll Cesr Elias 10 Dale'. April 25,2022
C. ITEMS FROM SALE: Unless are uded fromffi
other items) if any such item isin paragraph 3P(2); (ii) audio and video components (such as flat screen TVs, speakers and 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.

ALLOCATION OF COSTS:

A. INSPECTIONS, REPORTS AND CERTIFICATES: Paragraphs 3Q(1), (2), (3), and (5) only determines who is to pay for the inspection, test, certificate or service ("Report") mentioned; it does not determine who is to pay for any work recommended or identified in the Report. Agreements for payment of required work should be specified elsewhere in paragraph 3Q, or 3R, or in a separate agreement (such as C.A.R. Forms RR, RRRR, ADM or AEA).

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) and paid by the Party specified in paragraph 3Q(4). lf 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. lf 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) PO|NT OF SALE REQUTREMENTS:
(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 and paid by Party specified in paragraphs 3Q(5) and 3Q(5). Unless Parties Othenivise Agree to another time period, any such repair, shall be completed prior to final verification of Property. lf Buyer agrees to pay for any portion of such repair, Buyer, shall (i) directly pay completing the repair or (ii) provide an invoice to Escrow Holder, deposit funds into escrow sufficie to the vendor
nt 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: lf any repair in paragraph 108(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. lf Buyer incurs costs to comply with lender requirements concerning those items, Seller shall be responsible for those costs. (4) 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.

C. HOMEWARRANTY:
(1) Buyershall choosethecoverages,regardlessofanyoptional coveragesindicated,ofthehomewarrantyplanandBuyer shall pay any cost of that plan, chosen by Buyer, that exceeds the amount allocated to Seller in paragraph 3O(18). Buyer is informed that home warranty plans have many optional coverages, including but not limited to, coverages for Air Conditioner and Pool/Spa. Buyer is advised to investigate these coverages to determine those that may be suitable for Buyer. (2) lf Buyer waives the purchase of a home urarranty plan in paragraph 3Q(18), Buyer may still purchase a home warranty plan, at Buye/s expense, prior to Close Of Escrow.

11. STATUTORY AND OTHER DISCLOSURES (INCLUDING LEAD-BASED PA|NT HAZARD DISCLOSURES) AND CANCELLATION RIGHTS:

A. TDS, NHD, AND OTHER STATUTORY AND SUPPLEMENTAL DISCLOSURES:
(1) Sellershall, within the time specified in paragraph 3N('l), Deliverto Buyer: unless exempt, fully completed disclosures or notices required by SS 1102 et. seq. and 1103 et. seq. of the Civil Code ("Statutory Disclosures"). Statutory Disclosures include, but are not limited to, a Real Estate Transfer Disclosure Statement (C.A.R. Form TDS), Natural Hazard Disclosure Statement ("NHD"), notice or actual knowledge of release of illegal controlled substance, notice of special tax and/or assessments (or, if allowed, substantially equivalent notice regarding the Mello-Roos Community Facilities Act of 1982 and lmprovement Bond Act of 1915) and, if Seller has actual knowledge, of industrial use and military ordnance location (C.A.R. Form SPQ or ESD), and, if the Property is in a high orvery high fire hazard severity area, the information, notices, documentation, and agreements required by SS 1 1 02.6(f) and 1 1 02.1 9 of the Civil Code (C.A. R. Form FHDS). (2) The Real Estate Transfer Disclosure Statement required by this paragraph is considered fully completed if Seller has completed the section titled Coordination with Other Disclosure Forms by checking a box (Section l), and Seller has completed and answered all questions and Signed the Seller's lnformation section (Section ll) and the Seller's Agent, if any, has completed and Signed the Seller's Agent's section (Section lll), or, if applicable, an Agent Visual lnspection Disclosure (C.A.R. Form AVID). Section V acknowledgment of receipt of a Copy of the TDS shall be Signed after all previous sections, if applicable, have been completed. Nothing stated herein relieves a Buyer's Agent, if any, from the obligation to (i) conduct a reasonably competent and diligent visual inspection of the accessible areas of the Property and disclose, on Section lV of the TDS, or an AVID, material facts affecting the value or desirability of the Property that were or should have been revealed by such an inspection or (ii) complete any sections on all disclosures required to be completed by Buyer's Agent. (3) Seller shall, within the time specified in paragraph 3N('l), provide "Supplemental Disclosures" as follows: (i) unless exempt from the obligation to provide a TDS, complete a Seller Property Questionnaire (C.A.R. Form SPQ) by answering all questions and Signing and Delivering a Copy to Buyer; (ii) if exempt from the obligation to provide a TDS, complete an Exempt Seller Disclosure (C.A.R. Form ESD) by answering all questions and Signing and Delivering a Copy to Buyer. (4) ln the event Seller or Seller's Agent, 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 under this paragraph, Seller shall, in writing, promptly provide a subsequent or amended TDS, Seller Property Questionnaire or other document, in writing, covering those items. Any such document shall be deemed an amendment to the TDS or SPQ.

However, a subsequent or amended disclosure shall not be required for conditions and material inaccuracies of which Buyer is otherwise aware, or whicfi-are^-Qis@vpr91Qby Buyer or disclosed in reports or documents provided t'o or ordered and paid ror uv euv{et,l
I S€ I
RPA12I21 (PAGE 7 OF f 6) Buyer's lnitials x\___Jtx9---J Seller's lnitials x------J r,rj$1fl* cALtFORNtA RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 7 OF 16) ; (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 w.lwdlcom Cesar Elis cA 93535 Date: Aoril 25.2022
B. LEAD
(1) Seller shall, within the time specified in paragraph 3N(l), for any residential property built before January 1, 1978, unless exempted by Law, Deliver to Buyer a fully completed Federal Lead-Based Paint Disclosures (C.A.R. Form LPD) and pamphlet ("Lead Disclosures").
(2) Buyer shall, within the time specified in paragraph 3L(3), have the opportunity to conduct a risk assessment or to inspect for the presence of lead-based paint hazards.

C. HOME FIRE HARDENING DISCLOSURE AND ADVISORY: For any transaction where a TDS is required, the property is located in a high or very high fire hazard severity zone, and the home was constructed before January 1,2010, Seller shall, within the time specified in paragraph 3N(1), Deliver to Buyer: (i) a home hardening disclosure required by law; and (ii) a statement of features of which the Seller is aware that may make the home vulnerable to wildfire and flying embers; and (iii) a final inspection report regarding compliance with defensible space requirements if one was prepared pursuant to Government Code $ 51182 (C.A.R. Form FHDS).

D. DEFENSIBLE SPACE DISCLOSURE AND ADDENDUM: For any transaction in which a TDS is required and the property is located in a high or very high fire hazard severity zone, Seller shall, within the time specified in paragraph 3N(1), Deliver to Buyer(i) a disclosure of whetherthe Property is in compliance with any applicable defensible space laws designed to protect a structure on the Property from fire; and (ii) an addendum allocating responsibility for compliance with any such defensible space law (C.A.R. Form FHDS).

E. WAIVER PROHIBITED: Waiver of Statutory, Lead, and other Disclosures in paragraphs {lA(1), 118, 11C, and 11D are prohibited by Law.

F. RETURN OF SIGNED COPIES: Buyer shall, within the time specified in paragraph 3L(3) OR 5 Days after Delivery of any disclosures specified in paragraphs 11 A, B, C or D, and defensible space addendum in paragraph llD, whichever is later, return Signed Copies of the disclosures, and if applicable, addendum, to Seller.

G. TERMINATION RIGHTS:
(1) StatutoryandOtherDisclosures:lfanydisclosurespecifiedinparagraphst'lA,B,C,orD,orsubsequentoramended disclosure to those just specified, is Delivered to Buyer after the offer is Signed, Buyer shall have the right to terminate this Agreement within 3 Days after Delivery in person, or 5 Days after Delivery by deposit in the mail, or by an electronic record or email satisfying the Uniform Electronic Transactions Act (UETA), by giving written notice of rescission to Seller or Seller's Authorized Agent. lf Buyer does not rescind within this time period, Buyer has been deemed to have approved the disclosure and shall not have the right to cancel.
(2) Defensible Space Gompliance: lf, by the time specified in paragraph 11F, Buyer does not agree to the terms regarding defensible space compliance Delivered by Seller, as indicated by mutual signatures on the FHDS, then Seller, after first Delivering a Notice to Buyer to Perform, may cancel this Agreement.

H. 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 lnternal 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 quq[fieQ 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 lnternal 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. l. MEGAN'S=LAW DATABASE DISCLOSURE: Notice: Pursuant to $ 290.46 of the Penal Code, information about specified registered sex offenders is made available to the public via an lnternet Web site maintained by the Department of Justice at www.meganslaw.ca.gov. Depending on an offender's criminal history, this information will include either the address at which the offender resides or the community of residence and ZIP Code in which he or she resides. (Neither Seller nor Agent are required to check this website. lf Buyer wants further information, Agent recommends that Buyer obtain information from this website during Buyer's investigation contingency period. Agents do nottuve qlpq$gg_.!! this area.) J. NOTTCE REGIAR6|NG GAS AND HAZAR-DOI,S LIQUID1RANSMISSION 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) lnternet 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 id s6archable by ZIP Code and county on the NPMS lnternet Website. (Neither Seller nor Agent are required to check this website. lf 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.) K. CONDOMINIUM/PLANNED DEVELOPMENT DISCLOSURES:
(l ) Seller shall, within the time specified in paragraph 3N(t ), 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 SPQ or ESD).
(2) lf the Property is a condominium or is located in a planned development or other common ;n1u1ss1 .livelopment with a' ' HOA, Setier Sfratt, within the time specified in paragraph 3N(3), order from, and pay any required fee ad specified in paragraph 3a(12) for the following items to the HOA (C.A.R. Form HOA-IR): (i) Copies of any documents required.by Law (C.R.n. Fcjrm HOA-RS); (ii) disdosure 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; bnd (vii) smoking restrictions ("Cl Disclosures"). Seller shall itemize and Deliver to Buyer all Cl Disclbsures received from the HOA and any Cl Disclosures in Selleis possession. Seller shall, as directed by Escrow Holder, deposit funds into escrow or direct to HOA or management company to pay for-any ofthe above.

L. NATURAL AND ENVIRONMENTAL HAZARDS: Seller shall, within the time specified in paragraph 3N(1), if required by Law:
(i) Deliverto Buyerthe earthquake guide and environmental hazards booklet, and forall residential propertywith 1-4 units and any manufactured ormobile home built beforeJanuary 1, 1960, fully completean{Deliverthe-Resi{ential Earthquake Risk Di{closure Statement; and (ii) even if exempt from thi: obligation to provide a NHD, disclose if the Property is located in a Special Flood HazardArea; Potential Flooding (lnuqlqlioQArea; VeryHigh Fire Hazard Zone;.State Fire ResponsibilityArea; Ebrthquake Fault Zone; Seismic Hazard Zon-e; an{-(i!i)-d$cl(Se^a4flother zone as required by Law and provide any other information required forthose zones. let I I St I , ARPA 12t21 (PAGE 8 OF 16) Buyer's lnitials xL___J txL--) Seller's lnitials .si."J,iiilf; .ALTF.RNTA *=r'o:,T.,'"',3h,.iys:,li::5*9*:-=l:=-II*IR*:J,:T,,5:,f*PgJHTffiISt (RPAcPff: 8 0F 16) Aut'enlieisuBtf'FffE?8-381{i9lf=E3lF5=${981* r-gncaster. cn gssss Date. Aprit 25,2022 M.KNowNMATERlALFAGTS:Sel|ershall,withinthetimespecifiedinparagraph3N(,l),DlScLm 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 lender to get such information (C.A.R. Form ARC), and make any and all other disclosures required by Law.

I2. 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 lnvestigations").

B. Buyer lnvestigations include, but are not limited to:
(1 ) lnspections regarding any physical attributes of the Property or items connected to the Property, such as:
(A) A general home 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) Any other specific inspections of the physical condition of the land and improvements. (2) All other Buyer lnvestigations, such as insurance, not specified above. See, Buyer's lnvestigation Advisory (C.A.R. Form BIA) for more.
(3) A review of reports, disclosures or information prepared by or for Seller and Delivered to Buyer pursuant to paragraphs 3, 10, 11, and 14A.

C. Without Seller's prior written consent, Buyer shall neither make nor cause to be made: (i) invasive or destructive Buyer lnvestigations, except for minimally invasive testing required to prepare a Pest Control Report, which shall not include any holes or drilling though 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 Propefi available for all Buyer lnvestigations. Seller is not obligated to move any existing personal property.

Seller shall have water, gas, electricity and all operable pilot lights on for Buyeds lnvestigations and through the date possession is delivered to Buyer. Buyer shall, (i) by the time specified in paragraph 3L(3), complete Buyer lnvestigations and satisfo 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 lnvestigation 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 lnvestigation reports shall not include any appraisal, except an appraisal received in connection with an FHA orVA loan.

E. Buyer indemnity and Seller protection for entry upon the Propefi: Buyer shall: (i) keep the Property free and clear of liens; (ii) repair all damage arising from Buyer lnvestigations; 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, wokers' compensation and other applicable insurance, defending and protecting Seller from liability for any injuries to persons or property occurring during any Buyer lnvestigations or work done on the Property at Buyefs 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 lnvestigations and work done on the Property at Buye/s direction. Buyer's obligations under this paragraph shall survive the termination of this Agreement.

13. TITLE AND VESTING:

A. Buyer shall, within the time specified in paragraph 3N(l ), be provided a current Preliminary Report by the person responsible for paying for the title report in paragraph 3A(8). lf 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 lndex 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, Sellerwill take necessary action to delivertitle 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. lf 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 (or, for stock cooperative or long-term lease, an assignment of stock certificate or of Seller's leasehold interest), including oil, mineral and water rights if currently owned by Seller. Title shall vest as designated in Buye/s vesting instructions. The recording document shall contain Buye/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 APP
s€ef ARPA12t21(PAGE 9 OF 16) Buyer's lnitials Selle/s lnitials X I GAL|FORNIA RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 9 OF 16) Produced with Lone Wolf Transactions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 w.lwdf.com Cesar Elis o"**luigUBrff?AQfd?83E1*l83aBE€lFs$J/88t r-ancaste4 c.q ggsgs Date: Aprir 2s,2022 G. Buyer shall receive a "ALTA/CLTA Homeowner's Policy of Title lnsurance" or equivalent policy of title insurance, if applicable to the type of property and buyer. Escrow Holder shall request this policy. lf a ALTtuCLTA Homeowner's Policy of Title lnsurance is not offered, Buyer shall receive a CLTA Standard Coverage policy unless Buyer has chosen another policy and instructed Escrow Holder in writing of the policy chosen and agreed to pay any increase in cost. Buyer should consult with the Title Company about the availability, and difference in coverage, and cost, if any, between a ALTA/CLTA Homeowner's Policy and a CLTA Standard Coverage policy and other title policies and endorsements. Buyer should receive notice from the Title Company on its Preliminary ffitle) Report of the type of coverage offered. lf Buyer is not notified on the Preliminary (Title) Report or is not satisfied with the policy offered, and Buyer nonetheless removes the contingency for Review of the Preliminary Report, Buyer will receive the policy as specified in this paragraph. {4. 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 GR or CC).

A. SELLER DELIVERY OF DOCUMENTS: Seller shall, within the time specified in paragraph 3N(l), Deliver to Buyer all reports, disclosures and information ("Reports") forwhich Seller is responsible as specified in paragraphs 98(6), 10, 11A, 118, 11C, llD, 'llH, 11K,11L,llM, l3A, and 13D.

B. BUYER REVIEW OF DOCUMENTS; REPAIR REQUEST; CONTINGENCY REMOVAL OR CANCELLATION (1) Buyer has the time specified in paragraph 3 to: (i) perform Buyer lnvestigations; review all disclosures, reports, lease documents to be assumed by Buyer pursuant to paragraph 98(6), and other applicable information, which Buyer receives from Seller; and approve all matters affecting the Property; and (ii) Deliver to Seller Signed Copies of Statutory and Other Disclosures Delivered by Seller in accordance with paragraph 11. (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). lf 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, other than those in paragraph 11A or 118, is not Delivered within the time specified in paragraph 3N(l), 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. lf 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 1 1 G. (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 14C, 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 t4C(1).

C. SELLER RIGHT TO GANCEL:
(1) SELLER RIGHT TO CANCEL; BUYER CONTINGENCIES: lf, 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. ln 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 il by the time specified in this Agreement, Buyer does not take the following action(s):
(i) Deposit funds as required by paragraph 3D(l ) 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(4) (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 58 or 6A; (v) Deliver a letter as required by paragraph 68; (vi) ln writing assume or accept leases or liens specified in paragraph 8G; (vii) Return Statutory and Other Disclosures as required by paragraph 11F; (viii) Cooperate with the title company's effort to comply with the GTO as required by paragraph 13E; (ix) Sign or initial a separate liquidated damages form for an increased deposit as required by paragraphs 5A(2) and 29; (x) Provide evidence of authority to Sign in a representative capacity as specified in paragraph 28; or (xi) Perform any additional Buyer contractual obligation(s) included in this Agreement. ln such event, Seller shall authorize the return of Buyer's deposit, except for fees incurred by Buyer and other expenses already paid by Escrow Holder pursuant to this Agreement prior to Seller's cancellation. (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. BUYERRIGHTTOGANCEL:
(i) BUYER RIGHT TO CANCEL; SELLER CONTINGENGIES: lf, 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. ln such event, Seller shall authorize the return of Buyer's deposit, except for fees incurred by Buyer and other expenses already paid by Escrow Holder pursuant to this Agreement prior to Buyer's cancellation. (2) BUYER RIGHT TO CANCEL; SELLER CONTRACT OBLIGATIONS: lf, 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
BUYE
time specified, Buyer, after first Delivering to Seller a Notice to Seller to Perform, may cancel this Agreement. (3) R RIGHT TO CANCEL; BUYER CONTINGENCIES: Buyer may cancel this Agreement by good faith exercise of any Buyer contingency included in paragraph , so long as that contingency has not already been removed in writing
RPA12t21(PAGE lo OF 16) Buyer's lnitials Selleis lnitials X I CALIFORNIA RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 1O OF 16) Produced with Lone Wolf Transactions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 ww.Mdf.com Cesar Eli6 AuthenfrFEHBiiFTA%f, ?8E8f fJ83fE-SlBs$//88L r-ancaster, cn gssgs E. NOTICE TO BUYER OR SELLER TO PERFORM: The Notice to Buyer to Perform or Notice writing; (ii) be Signed by the applicable Buyer or Seller; and (iii) give the specified in the applicable paragraph, whichever occurs last) to take the to Seller to Perform may not be Delivered any eadier than 2 Days prior to or cancel this Agreement or meet an obligation specified in paragraph Date. April25,2022
to Seller to Perform shall: (i) be in
the timeother Party at least 2 Days after Delivery (or until applicable action. A Notice to Buyer to Perform or Notice the Scheduled Performance Day to remove a contingency
14, whether or not the Scheduled Performance Day falls
on a Saturday, Sunday or legal holiday. lf 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: lf Buyer removes any contingency or cancellation rights, unless Otherwise Agreed, Buyer shall conclusively be deemed to have: (i) completed all Buyer lnvestigations, 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 Selle/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: lf 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.

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. lf a DCE is incorrectly Delivered or specifies a time less than the above timeframe, the DCE shall be deemed invalid and void, and Selleror Buyershall be required to Delivera new DCE.

H. EFFECT OF CANCELLATION ON DEPOSITS: lf 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 cancellation 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 Pafi 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 S 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. '15. REPAIRS: Repairs shall be completed prior to final verification of condition unless Otherwise Agreed. Repairs to be performed at Selle/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 mannerwith 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.

16. 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 78; (ii) Repairs have been completed as agreed; and (iii) Seller has complied with Selleds other obligations under this Agreement (C.A.R. Form VP).

17. 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 assessmenls 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 shail 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 b.e prorated and paid as follows: (i) for feriods after Ciose Of Escrow, by Buyer; and (ii) for periods prior to Close Of Escrow, by Seller (see G.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 UTlLlry BILLS ISSUED AFTER CLOSE OF ESCROW SHALL BE HANDLED DIRECTLY BETWEEN BUYER AND SELLER. Prorations shall be made based on a 30-day month.

18. BROKERSANDAGENTS:

RPA12t21(PAGE 11 OF 16) Buyer's lnitials Seller's lnitials CALIFORNIA RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 11 OF 15) Produced with Lone Wolf Transactions (zjpFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 !4U LlUglLsqI[ Cesar Elias o"*"'!tigHBf f
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I9. 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 l, 3A, 38, 3D-G, 3N(2), 3Q, 3R, 4A, 48, 5A({-2) 5D, 5E, 108(2XA), 108(3), l0C, l'lH,'l1Kl2l, 13 (except 13D), 14H, '17,18A, 19,23,25,27,28,32,33, and paragraph 3 of the Real Estate Brokers Section. lf a Copy of the separate compensation agreement(s) provided for in paragraph l8A or paragraph C of the Real Estate Brokers Section is deposited with Escrow Holder by Agent, Escrow Holder shall accept such agreement(s) Dale: Aoril 25.2022
used:
executed, in writing, by the recipient Party and is
and
The
pay out from Buye/s or Seller's funds, or both, as applicable, the Brokeis compensation provided for in such agreement(s). 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.

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 offe(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 lnformation to Title Company when received from Seller, if a separate company is providing title insurance. lf Seller delivers an affidavit to Escrow Holder to satisfy Seller's FIRPTA obligation under paragraph 11H, Escrow Holder shall deliver to Buyer, Buyer's Agent, and Seller's Agent a Qualified Substitute statement that complies with federal Law. lf Escrow Holder's Qualified Substitute statement does not comply with federal law, the Parties instruct escrow to withhold all applicable required amounts under paragraph 11H.

D, Agents are not a party to the escrow, except for Brokers for the sole purpose of compensation pursuant to paragraph 18A and paragraph 3 of the Real Estate Brokers Section. lf 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 Buye/s or Selle/s funds, or both, as applicable, the Broker's compensation provided for in such agreement(s).Buyer and Seller inevocably assign to Brokers compensation specified in paragraph 18A, and inevocably 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 Holdeis 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 Buyeds deposit of funds pursuant to paragraphs 5A(1) and 5A(2). Once Escrow Holder becomes aware of any of the following, Escrow Holder shall immediately notifyeach 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.

20. 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.

21. 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, "lmages") 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 S 1088(c) requiresthe MLS to maintain such lmages and information forat leastthree years and a-s a result they may be displayed or circulated on the lnternet, which cannot be controlled or removed by Seller or Agents; and (iii) Seller, Selle/s Agent, Buyer's Agent, and MLS have no obligation or ability to remove such lmages or information from the lnternet.

22. ATTORNEY FEES AND GOSTS: ln any action, proceeding, or arbitration between Buyer and Seller arising out of this Agreement,

23. 24.

25. letters throughout this Agreement, and have the
A. "Acceptance" means the time the offer
en
or final
Delivered to the offering Party or that Party's Autho
RPA12t21(PAGE 12 OF 16) Buyer's lnitials Selleds lnitials X I CALIFORNIA RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 12 OF 16) Produced with Lone Wotf TEnsactions (zipFom Edition) 717 N Haryood St, Suite 2200, Dallas, TX 75201 M.Mdf.@m Cesar Elias o"*"'!tiguBi?F AqJ8?8E8ItrSg3fE-9393[lPd{ r-ancasrer: cA 93S3s Date: Aprir 25, 2022 B.,.Agent''meanstheBroker,salesperson,broker--ssocia@license@ identified in paragraph 28.

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-ls" 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. "Gopy" means copy by any means including photocopy, facsimile and electronic. l. 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. Forexample, if a Notice to Buyerto 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 1 1:59 pm on the last day for performance ("Scheduled Performance Day"). (a) 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. (5) For the purposes of COE, any day that the Recorder's office in the County where the Property is located is closed, the COE shall occur on the next day the Recorder's office in that County is 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. lf 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). ln such case, Delivery shall be effective upon Delivery of the documents and notthe 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. 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 32 or paragraph 33.

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

26. TERMS AND CONDITIONS OF OFFER: This is an offer to purchase the Property on the terms and conditions herein. The cALtFORNtA RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 13 OF 16) ProducedwithLoneWolfTransaclions(zipFomEdition)717NHaNoodSt,Suite2200,Dallas,TX75201 w.lwdl@m CsuElio o"'""luiUpB',yp6g?838lfJ83fE$lF53ff88t r-ancaster: ce ggogs Date: Aoril25.2022 29' LIQUIDATED DAMAGES (By initialing in the space below, you are agreeing to Liquidated Damages):
lf Buyer fails to complete this purchase because of Buyer's default, Seller shall retain, as liquidated damages, the deposit actually paid. lf the Propefi is a dwelling with no more than four units, one of which Buyer intends to occupy, then the amount retained shall be no more than 3% of the purchase price. Any excess shall be returned to Buyer. 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 SEPART\TE.LICIIIIDATED DAMAGES PROVISION INCORPORATING THE INCREASED DEposrr AS LTQUTDATED DA{€Esl,{.sE1"-M DrD).

Buyer'slnitialsL JIL J Seller'slnitials t

30. 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. lf, for any dispute or claim to which this paragraph applies, any Party (i) commences an action without first attempting to resolve the matterthrough 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 attomey 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 318; (ii) The obligation to mediate does not preclude the right of either Party to seek a preservation of rights under paragraph 31C; and (iii) Agenfs rights and obligations are further specified in paragraph 31D. These terms apply even if the Arbitration of Disputes paragraph is not initialed. s€
RPA12t21(PAGE 14 OF 16) Buyer's lnitials Seller's lnitials X I CALIFORN|A RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 14 OF 16) Produced with Lone Wolf Transactions (zipFom Edition) 717 N Hamood St, Suite 2200, Dallas, TX 75201 ww.hdf.com Cesar EIis 3I. 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, OR n _ . The arbitrator shall be a retired judge or justice, or an attorney with at least 5 years of residential 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 S 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 non- judicial foreclosure or other action or proceeding to enforce a deed of trust, mortgage or installment land sale contract as defined in Givil Code S 2985.

C. PRESERVATION OF AGTIONS: 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 aftachment, receivership, injunction, or other provisional remedies; 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 lN 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
ARBITRATION."
Buye/s lnitials
I}ICLI,.]DED IN +I.IE 'ARBITRATION
L*J,L''J

OF DISPUTES' PROVISION TO NEUTRAL
Seller's lnitials I
IYV
"'**luiflHBitfTff[?83811$83aBES8fi53ff881, r-ancaster, cA e3s3s Date: April 25.2022

32. BUYER'S 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 Buye/s Authorized Agent. Seller has no obligation to respond to an offer made.

B. ! eruflW BUYERS: (Note: lf 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 28 for additional terms.
(3) The name(s) of the Legally Authorized Signer(s) is/are (4) lf a trust, identifo Buyer as truslee(s) of the trust or by simplified trust name (ex. John Doe, co-trustee, Jane Doe, co-trustee or Doe Revocable Family Trust). lf the entity is a trust or under probate, the following is the full name of the trust or probate case, including case #:

C. The RPA has 16 pages. Buyer acknowledges receipt of, and has read and understands, every page and all attachments that make up the Agreement.

D. BUYER
(Signature)By, art f-lin6 Date:
o4t25Do22
Printed
! printed
(Signature) By,
Signer: Title, if applicable,
Date:
04t25t2022
Printed
! Printed name of Legally Authorized Signer: Title, if applicable, ! tr uone THAN TWo SIGNERS, USE Additional Signature Addendum (c.A.R. Form ASA).

33. 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)
I Back-Up Offer Addendum (C.A.R. Form BUO)
B. I entity Sellers: (Note: lf 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 ) OneormoreSellersisatrust,corporation,LLC,probateestate,partnership,holdingapowerofattorneyorotherentity. (2) This Agreement is being Signed by a Legally Authorized Signer in a representative capacity and not in an individual capacity. See paragraph 28 for additional terms.
(3) The name(s) of the Legally Authorized Signer(s) is/are: _(a) lf a trust, identify Seller as trustee(s) of the trust or by simplified trust name (ex. John Doe, co{rustee, Jane Doe, co-trustee or Doe Revocable Family Trust). lf the entity is a trust or under probate, the following is the full name of the trust or probate case, including case #:

C. The RPA has 16 pages. Selleracknowledges receiptof, and has read and understands, every page and all attachmentsthat make up the Agreement.

D. SELLERSIGNATURE(S):
(Signature) By, Date:

Printed name of SELLER'. Owner of Record
! Printed Name of Legally Authorized Signer: Title, if applicable, Date:(Signature) By
Printed name of SELLER:
! erinteO Name of Legally Authorized Signer Title, if applicable, I tr uone THAN TWo SIGNERS, USE Additional Signature Addendum (C.A.R. Form ASA) st
RPA12t2't (PAGE 15 OF 16) Buyer's lnitials Selleds lnitials X I cALtFORNtA RESIDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 1s OF 16) Produced with Lone Wotf Transac{ions (ipForm Edition) 717 N HaMood St, Suite 2200, Dallas, TX 75201 Wlledlgal! Cesr Eli* No Counter Offer is being made. This offer was not accepted by Seller (date) Seller's lnitials
OFFER NOT ACCEPTED:

AuthenftFUHBiff ?fff{?8E8|trfl 83fEajlfi s$#88t r-ancaster. cr g3s3s Dale: Aoril25.2022 PRESENTATION OF OFFER: Seller's Brokerage Firm presented this offer to Seller on Agent or Seller lnitials
(date).
€) 2021, Califomia Association of REALTORS@, lnc. United States copyright law (fite 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 OUALIFIED 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@. lt 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 CALTFORIVIA ASSOCIATION OF REALIORS@ 525 South Virgil Avenue, Los Angeles, Califomia 90020
RPA12t21(PAGE 16 OF r6) Buyer's lnitials Seller's lnitials X ______J CALTFORNIA RESTDENTTAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (RPA PAGE 16 OF 16) Produ@d with Lone Wolf Transactions (zipForm Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 ww.kollcom Cesar Elis s
'l

1. 2.

3. REAL ESTATE BROKERS SECTION:

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

Agency relationships are confinned as stated in paragraph 2.

Cooperating Broker Compensation: Seller's Broker agrees to pay Buyer's Broker and Buyer's Broker agrees to accept, out of Selle/s Broke/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. lf 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.

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.

Agents' Signatures and designated electronic delivery address:

4. 5.

A. Bu Lic. # 01200081
By Lic. # O21O2346 04t25t2022L'AIE
By 412512022 9:45:39 PM GMT Lic. # Date
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 BrokerAcknowledgement (C.A.R. Form ABA) attached.

Designated Electronic Delivery Address(es):

Email Text #
Alternate
! if checked, Delivery shall be made to the alternate designated electronic delivery address only Address 19O Siena Ct Ste 8214 City Palmdale State CA Zip 93550-7611 B. Selle/s Brokerage Firm Coldwell Banker-A Haftvio Co. Lic. # 00450461 By
By
Dennis Greer Lic. # 00758955 Date
Lic. # Date
nn
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 Selleds Agent):

Email Text #
Alternate:
f if chect<ed, Delivery shall be made to the alternate designated electronic delivery address only.

Address 43912 N. 20th St. West City Lancaster State CA Zip 9353tt ESCROW HOLDER ACKNOWLEDGMENT:

Escrow Holder acknowledges receipt of a Copy of this Agreement, (if checked, n a deposit in the amount of $ ), Counter Offer numbers and and agrees to act as Escrow Holder subject to paragraph { 9 of this Agreement, any supplemental escrow instructions and the terms of Escrow Holder's general provisions.

EscrowHolderisadvisedbythatthedateofAcceptanceoftheAgreementis Escrow Holder Seller sChoice Escrow #
By Date
Address
Phone/FaxlE-mail
Escrow Holder has the following license number #
! Department of Financial Protection and lnnovation, ! Department of lnsurance, I Department of Real Estate.

L
I
c
-*"ry 9-83CF481 D-9488-C80B57Fl 7D51
CALiFORNIA

ASSOCIATION

OF REALTORSO

BUYER'S INVESTIGATION ADVISORY
(G.A.R. Form BlA, Revised l2121)
Property Address 45534 E
'th
Street, Lancaster, CA 93s3s

1. IMPORTANCE OF PROPERW 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. lf 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. lf 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 FOLLOWNG. 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: WateT and utility availabilfty, 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, lead- based 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.
l. 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, self- latching 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.

O 202'1, Califomia Association of REALTORS@, lnc.

BtA REV|SED 12t21(PAGE 1 OF 2)
Renwick Properties, 190 Sierm Ct. St. 8206 Palmdale CA 93a50 Phone: (661) t6045?7 Metik Olivier Produced with Lone Wolf Transactions (zipFom Edition) 717 N HaMood St, Suite 2200, Dallas, TX 75201 Fax:
w.lwdlcom
Cesr Elias
BUYER'S INVESTIGATION ADVISORY BIA PAGE ,l OF
Authentisign lD: 2E766Al 9a3CF-{8
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, underctand, accept and have received a Copy of this Advisory B ns are encouraged to read it carefully
Buyer
Buyer
qfl AinS Date o4t25t2022
EliaS Date 04t2st2022
4 t 25t 2022 9:39:.54 P M G MT
@ 2021, Califomia Association of REALTORS@, Inc. United States copyright law (Tiile 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 cRltroRruth AssoctATtoN oF REALToRS@. No REPRESENTAT|oN ts MADE AS To rHE LEGAL vALtDtrY oR AccuRACY oF ANY PRovlsloN lN ANY sPEclFlc 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 Califomia Association of REALTORS@. lt 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 SUSINESS SERVICES, LLC.
a subsidiary of the CAL,FOR/V/A ASSOCIATION OF REALTORS@ 525 South Virgil Avenue, Los Angeles, Califomia 90020
BrA REVTSED 12t21(PAGE2OF 2l
BUYER'S INVESTIGATION ADVISORY (BlA PAGE 2OF 2)
Produced with Lone Wolf Transactions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 w.lwdfcom Ces Elis -.:s;;;:;:-"'-"
-€
oFRE-\LroRSe

CALIFORNIA CONSUMER PRIVACY ACT ADVISORY,

DISCLOSURE AND NOTICE
(C.A.R Form CCPA, Revised 1221)
The California Consumer Privacy Act (commencing with Civil Code S 1798.100) ('CCPA") grants to California residents certain rights in their private, personal information ("P1") that is collected by companies with whom they do business.

Under the CCPA, Pl is defined broadly to encompass non-public records information that could reasonably be linked directly or indirectly to you. Pl could potentially include photographs of, or sales information about, your property.

During the process of buying and selling real estate your Pl 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 Pl, including the right to know what Pl is collected, "opt out" or stop the transfer of your Pl to others, and the right to request that the business delete your Pl entirely. 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 Pl are obligated to comply with the CCPA. Also, even businesses that are otherwise covered under the CCPA may have a legal obligation to maintain Pl, 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. lf 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 J ustice (oag.ca. gov/privacy/ccpa).
l/we acknowledge receipt of a this Galifornia Consumer Privacy Act Advisory, Disclosure and Notice. eUflrJ Date o4t2st2o22
Buyer/Seller/Landlord/Tenant
PM GMT
Buyer/Seller/Landlord/Tenant Date o4t25t2022
PM GMT
form, or any portion thereof, by photocopy machine or any other means, including facsimile or computerized formats. THIS FORM HAS BEEN APPROVED BY THE cRLtronrutn nssoctATtoN oF nenlronso. No REPRESENTAT|oN ls MADE AS To rHE LEGAL vALtDtrY oR AccuRACY oF ANY PRovlsloN lN ANY sPEclFlc 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 Califomia Association of REALTORS@. lt 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 CALIFORA,IA ASSOCIATION OF REALIORS@ 525 South Virgil Avenue, Los Angeles, Califomia 90020
ccPA REVISED 12t21(PAGE 1 OF 1)
A'L
CALIFORNIA CONSUMER PRIVACY PAGE 1 OF 1
Retrwick Properti6, 190 Sicrh Ct Stc F206 Palmdal. CA 93550 Phone: (56f) t60-457 Melik Oliviei Prcduced with Lone Wolf TEnsaclions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 75201 Fax:
wW.lwolf.com
Cesff Elis
Authentisign lD: 2E766Al 9-83CF481 D-9A88-C80B57Ft 7D5l

CALIFORNIA

AS SOC IATION
OF REALTORS€
TEXT OVERFLOW ADDENDUM No.
(C.A.R. Form TOA, Revised 6/16)
45534 E ith Streel
1 (,'property,,),
This addendum is given in connection with the property known as in which
and
Cesar Elias, Santiaqo Elias
Owner of Record
Lancaster, CA 93535
is referred to as ("Buyer'')
is referred to as ("Selle/')
1) RPA, Q(2), Report:

Termite & Secfion 7 Clearance
which
Buyer
Buyer
Seller
The foregoing terms and conditions are hereby incorporated in and made a part of the paragraph(s) referred to in the document to The undersigned acknowledge receipt of a copy of this TOA.

Date 04n5t2o22
04t25t2022L'AIE
PM GMT
Date
Owner of Record
Seller Date
@2014, Califomia Association of REALTORS@, lnc. 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@ (C,A.R.). 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 C.A.R. lt is not intended to identify the user as a REALTOR@.

REALTOR@ is a registered collective memberchip mart which may be used only by members of ihe NATIONAL ASSOCIATION OF REALTORS@ who subscribe to its Ethics.

Published and Distributed by:

REAL ESTATE BUSINESS SERVICES, LLC.
a subsidiary of the Califomia Associatrbn of REALIORS@
525 South Virgil Avenue, Los Angeles, Califomia 90020
TOA REVISED 6/16 (PAGE 1 OF r)
1 1
Reffiick Prcpedies, 190 Siera Ct. Ste FZ)6 Pa.lmdrle CA 93550 Phone: (661) t60-4577 Fax:

Melik Olivier Produced with Lone Wolf TEnsactions (zipFom Edition) 717 N Haruood St, Suite 2200, Dallas, TX 7520'l ww.Mdf.com Ceer Elias

STAFF REPORT
Lancaster Successor Agency
SA CC 1
5/24/2022
JC
Date: May 24, 2022
To: Mayor Parris and City Council Members
From: Jeff Hogan, Senior Director - Development Services Chenin Dow, Senior Manager - Real Estate & Economic Development Sydney Yeseta, Assistant Manager – Economic Development Subject: Fourth Amendment to Declaration of Covenants, Conditions and Restrictions for the Auto Mall
Recommendation:

1. Approve a Fourth Amendment to the Declaration of Covenants, Conditions and Restrictions for the Auto Mall.

2. Approve a Waiver with Mass Investments Group, LLC to detach from the Landscape Maintenance District within the Auto Mall.

3. Authorize the Executive Director or his designee to finalize and execute all related documents.

Fiscal Impact:

None.

Background:

The Auto Mall was created during the Redevelopment Agency era, which played a vital role in acquiring properties that brought the dealerships and the Auto Mall to the City. The original Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall (Declaration) was executed and recorded in 1989. By 1996, three subsequent amendments were recorded. However, there have been no additional amendments since.

In the years since 1996, the Redevelopment Agency has been dissolved and the Successor Agency no longer owns real property that is subject to the Declaration. However, the Declaration has not been amended to terminate the Agency’s rights. The execution and recordation of the Fourth Amendment would terminate the Agency’s rights and remove any obligations imposed by the Declaration.
9 2
3 As part of the Second Amendment to the Declaration that was recorded in 1995, the owners of the property within the Auto Mall decided to detach from the existing Landscape Maintenance District. A waiver was executed that requires the owners to maintain the landscaped areas themselves.

When a property is transferred or sold, a new waiver must be executed by the new buyer. With the pending sale between Viper Enterprises Inc. and Mass Investments Group, LLC a new waiver must be executed.

If approved, the amendment and waiver will be executed and recorded as part of the property sale.

Attachment:

1. Fourth Amendment to Declaration of Covenants, Conditions and Restrictions for the Auto Mall

2. Waiver with Mass Investments Group, LLC
DOCSOC/1382264v2/022892-0010
1 RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
[INSERT]
[Space above for recorder.]

FOURTH AMENDMENT TO

DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS

FOR THE ANTELOPE VALLEY AUTO MALL
This FOURTH AMENDMENT TO DECLARATION OF COVENANTS,
CONDITIONS AND RESTRICTIONS FOR THE ANTELOPE VALLEY AUTO MALL (this “Fourth Amendment”) is made and entered into as of _________ ___, 2022 (“Effective Date”), by and among the LANCASTER SUCCESSOR AGENCY, a public entity acting as successor-in- interest to the Lancaster Redevelopment Agency (“Agency”), the CITY OF LANCASTER, a California municipal corporation and charter city (“City”), the LANCASTER AUTO MALL ASSOCIATION, a California nonprofit mutual benefit corporation (“Association”), 43301 12 th STREET WEST, LLC, a California limited liability company (“12 th Street”), 7 JAYS, LLC, a California limited liability company (“7 Jays”), SULLY III AVP, LLC, a Delaware limited liability company (“Sully”) and DK PROPERTIES AND HOLDINGS, LLC, a California limited liability company (“DK Properties”) (Agency, City, Association, 12 th Street, 7 Jays, Viper, Sully and DK Properties) are referred to individually as a “Party” and collectively as the “Parties”).

RECITALS
A. Each Party, or its predecessor-in-interest, is party to that certain Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall dated as of June 13, 1989, and recorded in the official records of the Los Angeles County Recorder on July 11, 1989, as document number 89-1098946 (“Declaration”).

B. The Declaration was amended by the following: (i) First Amendment to Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall dated as of December 9, 1992, and recorded in the official records of the Los Angeles County Recorder on January 26, 1996 as Exhibit B of document number 96-153764 (“First Amendment”); and (ii) Second Amendment to Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall dated as of September 12, 1995, and recorded in the official records of the Los Angeles County Recorder on October 26, 1995, as document number 95-1738339 (“Second Amendment”); and (iii) Third Amendment to Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall dated as of November 6, 1995 and recorded in official records of the Los Angeles County Recorder on January 26, 1996, as document number 96-153764 (“Third Amendment”).

DOCSOC/1382264v2/022892-0010
2 C. Agency no longer owns real property that is subject to the Declaration and no longer desires to retain any rights that it may hold in gross.

D. By this Fourth Amendment, the Parties intend to exercise their right to amend the Declaration (as previously amended by the First Amendment, Second Amendment and Third Amendment) in order to terminate any and all rights granted to or vested in Agency, including its predecessor-in-interest, that are held in gross.

NOW, THEREFORE, that Parties agree to amend the Declaration as follows:

1. Incorporation of Recitals. The foregoing recitals are true, correct, and constitute a substantive part of this Fourth Amendment.

2. Termination of Remaining Agency Rights. As of the Effective Date, Agency shall no longer be a party to or beneficiary of any rights under the Declaration and shall no longer be subject to any obligations imposed by the Declaration. Without limiting the generality of the foregoing, the Parties specifically acknowledge and agree that any rights Agency holds in gross pursuant to section 18 of the Second Amendment, or any other provision of the Declaration, First Amendment, Second Amendment, and/or Third Amendment shall be and hereby are terminated as of the Effective Date.

3. Governing Law. This Fourth Amendment has been negotiated and executed in the State of California and shall be governed by and construed under the laws of the State of California.

4. Cooperation; Further Acts. The Parties shall cooperate reasonably with one another and shall take any additional acts or sign any additional documents as may be necessary, appropriate or convenient to attain the purposes of this Agreement.

5. Construction; References; Captions. Since the Parties or their agents have participated fully in the preparation of this Agreement, the language of this Agreement shall be construed simply, according to its fair meaning, and not strictly for or against any Party. Unless otherwise provided, any term referencing time, days or period for performance shall be deemed calendar days and not business days. The captions of the various articles and paragraphs are for convenience and ease of reference only, and do not define, limit, augment, or describe the scope, content, or intent of this Agreement.

6. Counterparts; Electronic Execution. This Agreement may be executed in multiple counterparts by the Parties. All counterparts so executed shall constitute one agreement binding upon the Parties, notwithstanding that the Parties are not signatories to the original or the same counterpart.

Each counterpart shall be deemed an original to this Agreement, all of which shall constitute one (1) agreement. Documents executed, scanned and transmitted electronically and electronic signatures shall be deemed original signatures for purposes of this Agreement and all matters related thereto, with such scanned and electronic signatures having the same legal effect as original signatures. This Agreement, any other document necessary for the consummation of the transaction contemplated by this Agreement may be accepted, executed or agreed to through the use of an electronic signature in accordance with the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. § 7001 et seq. (“E-Sign Act”), and the Uniform Electronic Transactions Act, Cal. Civ. Code § 1633.1 et seq. ("UETA").

DOCSOC/1382264v2/022892-0010
3 [Signatures begin on next page.]
DOCSOC/1382264v2/022892-0010
4 7. Rights and Obligations Appurtenant to Real Property Not Terminated. Nothing in this Fourth Amendment terminates, limits, or in any way modifies rights and/or obligations appurtenant to real property, including real property previously owned by Agency.

8. Full Force and Effect; Definitions. Except as expressly provided to the contrary in this Fourth Amendment, the terms of the Declaration (as amended by the First Amendment, Second Amendment and Third Amendment) shall remain in full force and effect as written. Unless otherwise indicated, all terms used herein and not defined herein but defined in the Declaration shall have the meaning given to such terms therein.

9. Cooperation; Further Acts. The Parties shall cooperate reasonably with one another and shall take any additional acts or sign any additional documents as may be necessary, appropriate or convenient to attain the purposes of this Fourth Amendment.

IN WITNESS WHEREOF, the Parties have executed this Fourth Amendment as of the date set forth above.

AGENCY:

LANCASTER SUCCESSOR AGENCY,
a public entity acting as successor-in-interest to the
Lancaster Redevelopment Agency
By: _______________________________
Name: _______________________________
Its: _______________________________
CITY:

CITY OF LANCASTER,
a California municipal corporation and charter city
By: _______________________________
Name: _______________________________
Its: _______________________________
[Signatures continue on next page.]
DOCSOC/1382264v2/022892-0010
5 ASSOCIATION:

LANCASTER AUTO MALL ASSOCIATION,
a California nonprofit mutual benefit corporation
By: _______________________________
Name: _______________________________
Its: _______________________________
43301 12TH STREET WEST, LLC,
a California limited liability company
By: _______________________________
Name: _______________________________
Its: _______________________________
7 JAYS, LLC,
a California limited liability company
By: _______________________________
Name: _______________________________
Its: _______________________________

SULLY III AVP, LLC,
a Delaware limited liability company
By: _______________________________
Name: _______________________________
Its: _______________________________

DK PROPERTIES AND HOLDINGS,
a California limited liability company
By: _______________________________
Name: _______________________________
Its: _______________________________
WAIVER
THIS WAIVER is entered into on the day _________ of ________, 2022, by and among the CITY OF LANCASTER, a municipal corporation ("City"), the LANCASTER SUCCESSOR AGENCY, as successor to the Lancaster Redevelopment Agency, a public body, corporate and politic (" Agency"), and MASS INVESTMENTS GROUP, LLC , a California limited liability company (“Buyer”).

RECITALS
A. Buyer and City each own real property subject to that certain Declaration of Covenants.

Conditions and Restrictions for The Antelope Valley Auto Mall, dated June 13, 1989, which was recorded as Document No. 89-1098946 in the Official Records of the Los Angeles County Recorder's Office on July 11, 1989 and amended by (i) that certain First Amendment to Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall dated December 9, 1992, which was recorded as Exhibit B of Document No. 96-153764 and (ii) that certain Second Amendment to Declaration of Covenants, Conditions and Restrictions for the Antelope Valley Auto Mall dated September 12, 1995 which was recorded as Document No. 95- 1738339, and (iii) that certain Third Amendment to Declaration of Covenants, Conditions, and Restrictions for the Antelope Valley Auto Mall dated November 6, 1995 which was recorded at Document No. 96-153764 (collectively, the "Declaration") and are each an "Owner" and are collectively "Owners" within the meaning of the Declaration.

B. The Declaration was recorded against certain real property located within the City of Lancaster, County of Los Angeles, California, which is legally described in Attachment "A" attached hereto and incorporated herein by reference (the "Property") intended to be developed as a master-planned retail automotive sale and leasing center (the "Auto Mall").

C. Each Owner is a member of the Lancaster Auto Mall Association, a California nonprofit mutual benefit corporation (the "Association").

D. The Association was formed for the purpose of exercising the powers and functions set forth in the Declaration, including administering, managing and maintaining certain aspects of the Auto Mall and the Property, including any portion of the public right-of-way located within or contiguous to the Property required to be maintained by the Association as set forth in a duly authorized written agreement entered into among the Association, the City, and the Agency and any portion of a parcel required to be maintained by the Association as set forth in a duly authorized written agreement entered into between the Association and the owner of such parcel.

E. As a condition to the subdivision of parcels in the Auto Mall, Parcel Map No. 20314 required the establishment of Zone "A" of the Landscape Maintenance District ("Zone "A") pursuant to the Landscape and Lighting Act of 1972 (California Streets & Highways Code Section 22500 er seq.) (the “Act") to provide for the maintenance of the ten-foot-wide landscaped areas adjacent to the street rights-of-way in the Auto Mall.

F. In order to fairly assess the benefit derived from landscaping adjacent to major and secondary streets in the Auto Mall, annual assessments are levied on the Owners to pay for maintenance and contractor costs incurred by City in connection with the maintenance of the landscaped strips included within Zone “A”
G. The Owners desire that the real property included within Zone "A" be detached from the Landscape Maintenance District and that the Owners be permitted to maintain or cause to be maintained the landscaped areas within the Auto Mall.

H. In order to effectuate the detachment of Zone “A” from the Landscape Maintenance District and ensure the continued maintenance of the landscaped areas in the Auto Mall, it is necessary that the Declaration be amended as set forth in the Second Amendment t o the Declaration of Covenants. Conditions and Restrictions for the Antelope Valley Auto Mall (the '"Second Declaration Amendment").

I. The City and Agency are willing to conditionally detach Zone "A" from the Landscape Maintenance District provided the Owners (i) waive any rights which Owners may have to contest or protest such detachment, (ii) acknowledge City's right to re-annex the Property into Zone "A" of the Landscape Maintenance District in the event of default by the Owners in their obligation to maintain the landscape areas in the Auto Mall in accordance with the Second Declaration Amendment and (iii) waive any rights which Owners may have to contest or protest such annexation and subsequent levy of assessments.

J. Upon the satisfaction of certain conditions precedent, including, but not limited to, the execution of this Waiver, the Agency and the City have agreed in the Second Declaration Amendment to initiate such detachment proceedings and to authorize such private work in accordance with certain conditions and procedures set forth in the Second Declaration Amendment in order to ensure a continued level of quality and service in the maintenance of the landscaped areas in the Auto Mall.

NOW, THEREFORE, the undersigned hereby acknowledge and agree for themselves, their assignees and any and all successors in interest to the Property as follows:

Section 1: Each Owner hereby waives the resolutions, reports, notices of hearing, and rights of majority protest as set forth in California Streets and Highway Code Sections 22609 and 22585 er seq. and any other form of notice, contest or protest provided under such sections or permitted under any other applicable local, state or federal law with respect to the detachment of "Zone A" from the Landscape Maintenance District.

Section 2: Each Owner hereby acknowledges and agrees that City shall have the right to re- annex the Property into Zone "A" of the Landscape Maintenance District ("the Re-Annexation") upon the occurrence of an "Event of Default" as defined in Section 12 of the Second Declaration Amendment.

Section 3: In accordance with Streets and Highways Code Section 22608, each Owner hereby waives the resolutions, reports, notices of hearing and right of majority protest and any other form of contest or protest as provided under such sections or permitted under any other applicable local, state or federal law with respect to the Re-Annexation.

Section 4: In the event of Re-Annexation, each Owner hereby waives the right to protest as set forth in Streets and Highways Code Sections 22589 and 22628 and any other form of contest or protest as provided under such sections or other applicable local, state or law with respect to assessments subsequently levied to reimburse the City for all costs incurred in connection with the Re-Annexation and for all costs of reconstruction and/or relandscaping of any portion of the Property and the landscaped areas therein damaged by or as a result of Owners' default under the Second Declaration Amendment and otherwise necessary to maintain Zone "A" of the Landscape Maintenance District.

Section 5: Each Owner hereby agrees, warrants and represents that he/it has carefully read the contents of this Waiver and that, in executing this Waiver he/it does so with full knowledge of any right which he/it may have, that he/it has received independent legal advice from his/its attorneys. or in the alternative, knowingly has determined not to seek legal advice with respect to the matters set forth herein, and that each Owner has freely signed this Waiver without relying on any agreement, promise, statement or representation by or on behalf of either City or Agency, or their respective officers, agents, employees, attorneys except as specifically set forth in the Second Declaration Amendment and this Waiver. Each Owner further acknowledges that the waivers set forth herein represent substantial incentive- and consideration for the detachment of Zone "A" from the Landscape Maintenance District and that but for the waivers by each Owner the City would not commence detachment proceedings.

Section 6: The statements, representations and recitals contained in this Waiver are to be considered contractual in nature and not merely recitations of fact. This Waiver shall be binding upon, and inure to the benefit of, the parties hereto and their respective heirs, agents, successors, legal representatives and assigns.

Section 7: The laws of the State of California shall govern this Waiver in all respects, including, but not limited to, matters of construction, validity, enforcement and interpretation.

Section 8: The drafting and negotiation of this Waiver has been participated in by = City. Agency and Owners. and for all purposes this Waiver shall be deemed to have been drafted jointly by all parties.
[Signatures begin on next page.]
Dated:

LANCASTER SUCCESSOR AGENCY, a public body, corporate and politic By:

Executive Director
Dated:

CITY OF LANCASTER, a municipal corporation and charter city By:

City Manager
ATTEST :

City Clerk of the City of Lancaster

APPROVED AS TO FORM
By:

City Attorney/Agency Counsel
Dated:

BUYER
MASS INVESTMENTS GROUP, LLC, a California limited liability company By:

Its: __________________________________
.

STAFF REPORT
California Choice Energy Authority
Date: May 24, 2022
To: Chairman Parris and Authority Members
From: Jason Caudle, Executive Director
Subject: Approve California Choice Energy Authority Entering into Long-Term Resource Adequacy Agreements with Santa Paula Energy Storage, LLC on behalf of Apple Valley Choice Energy, Lancaster Choice Energy, Pico Rivera Innovative Municipal Energy, Pomona Choice Energy, Rancho Mirage Energy Authority, San Jacinto Power, and Santa Barbara Clean Energy
Recommendations:

1. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Apple Valley Choice Energy.

2. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Lancaster Choice Energy.

3. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Pico Rivera Innovative Municipal Energy.

4. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Pomona Choice Energy.

5. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Rancho Mirage Energy Authority.

6. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of San Jacinto Power.

7. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Santa Paula Energy Storage, LLC on behalf of Santa Barbara Clean Energy
Fiscal Impact:

There is no fiscal impact to California Choice Energy Authority.

CCEA CC 1
05/24/22
JC
Background:

California Choice Energy Authority (CalChoice) provides operational and administrative support, including procurement services, to seven operational Community Choice Aggregation (CCA) programs: Apple Valley Choice Energy (AVCE), Lancaster Choice Energy (LCE), Pico Rivera Innovative Municipal Energy (PRIME), Pomona Choice Energy (Pomona Choice), Rancho Mirage Energy Authority (RMEA), San Jacinto Power (SJP), and Santa Barbara Clean Energy (SBCE). As CCAs, each is required to meet certain state-mandated obligations, including those required by the California Public Utilities Commission (CPUC).

In June 2021, the CPUC adopted Decision 21-06-035 (Mid-Term Reliability Order) or (MTR).

The Mid-Term Reliability Order seeks to ensure that there are sufficient resources available to ensure electric grid reliability and to meet the state’s greenhouse gas (GHG) emission reduction goals for the electricity sector and imposes procurement requirements on all load-serving entities (LSEs), including CCAs.

The MTR orders the procurement of 11,500 MW of new generation resources to come online in the years 2023 – 2026, with all resources coming from zero-emitting sources of non-fossil fuel resources. All LSEs must contract for clean resources, such as renewable energy, stand-alone battery storage, renewable energy plus battery storage, and demand response. Contracts must be ten years or great from the initial project delivery to the end of the term.

To meet the requirements of the Mid-Term Reliability Order, CalChoice joined with Desert Community Energy and Clean Energy Alliance to issue a joint Request for Proposals for MTR projects in January 2022. Over 100 unique offers from 22 developers were received.

Additionally, CalChoice on behalf of its member agencies continues to seek out projects that meet the MTR requirements and engage in bilateral negotiations.

CalChoice and its legal and technical team have negotiated an agreement with developer esVolta for the Santa Paula Energy Storage, LLC project (Santa Paula Energy Storage). The project is a stand-alone battery storage project located in Santa Paula, California, will a commercial delivery date of August 2023.

As a condition of each agreement, Santa Paula Energy Storage recognizes and accepts the secured deposit account in the name of each CCA as credit and collateral, and no other security or credit backing by the cities or CalChoice will be required.

The Town and City Councils of the Town of Apple Valley, and the cities of Lancaster, Pico Rivera, Pomona, Rancho Mirage, San Jacinto, and Santa Barbara have, or will have approved CalChoice entering into these agreements at their respective council meetings prior to execution of the agreements.

Attachments:

Sample Power Purchase Agreement

Proposed Execution Version

IN FRONT OF THE METER

ENERGY STORAGE RESOURCE ADEQUACY AGREEMENT

COVER SHEET
Seller: Santa Paula Energy Storage, LLC, a Delaware limited liability company Buyer: California Choice Energy Authority, a California joint powers authority, on behalf of City of San Jacinto, a California municipal corporation (d/b/a San Jacinto Power) Description of Project: S anta Paula Energy Storage
Contract Amounts:

RA Attributes:

Local RA Attributes:

Flexible RA Attributes:

Payment Quantity:

Contract Price:

Milestones:

Milestone Date
Interconnection Agreement Executed
Site Control Completed
Construction Start Completed
Commercial Operation Deadline
Expected Initial Delivery Date
Delivery Term:

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TABLE OF CONTENTS

ARTICLE 1: DEFINITIONS ..........................................................................................................1

1.1 Contract Definitions .................................................................................................1

1.2 Rules of Interpretation ...........................................................................................17 ARTICLE 2: TERM .....................................................................................................................19

2.1 Effectiveness ..........................................................................................................19

2.2 Term .......................................................................................................................19 ARTICLE 3: PROJECT DEVELOPMENT .................................................................................19

3.1 Project Construction...............................................................................................19

3.2 Interconnection ......................................................................................................20

3.3 Metering .................................................................................................................20

3.4 Progress Reports ....................................................................................................20

3.5 Remedial Action Plans ...........................................................................................20

3.6 Standalone Energy Storage Incentives ...................................................................20 ARTICLE 4: INITIAL DELIVERY DATE .................................................................................21

4.1 Timing of the Initial Delivery Date .......................................................................21

4.2 Conditions Precedent to the Initial Delivery Date .................................................21

4.3 Cooperation in Connection with Initial Delivery Date ..........................................23

4.4 Confirmation of Initial Delivery Date ....................................................................23 ARTICLE 5: TRANSACTION ....................................................................................................23

5.1 Product ...................................................................................................................23

5.2 Purchase and Sale Obligation ................................................................................24

5.3 Allocation of CAISO Payments and Costs ............................................................25 ARTICLE 6: OPERATIONS ........................................................................................................25

6.1 Operations ..............................................................................................................25

6.2 Charging Energy ....................................................................................................25

6.3 Standard of Care ....................................................................................................25

6.4 Buyer’s Compliance Obligations; Certification of Product ...................................25

6.5 Scheduling..............................................................................................................26

6.6 Information Sharing and Shared Learning .............................................................26

6.7 Changes in Law......................................................................................................27 ARTICLE 7: EVENTS OF DEFAULT; REMEDIES ..................................................................28

7.1 Events of Default ...................................................................................................28

7.2 Remedies; Declaration of Early Termination Date ................................................30

7.3 Termination Payment .............................................................................................30

7.4 Notice of Payment of Termination Payment .........................................................31

7.5 Disputes with Respect to Termination Payment ....................................................31

7.6 Rights and Remedies Are Cumulative ...................................................................31

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ARTICLE 8: FORCE MAJEURE ................................................................................................31

8.1 Force Majeure ........................................................................................................31 ARTICLE 9: INVOICING AND PAYMENT .............................................................................32

9.1 Invoicing ................................................................................................................32

9.2 Payment..................................................................................................................33

9.3 Payment Adjustments; Billing Errors ....................................................................33

9.4 Billing Disputes .....................................................................................................33

9.5 Netting of Payments ...............................................................................................33 ARTICLE 10: PERFORMANCE ASSURANCE ........................................................................34

10.1 Seller’s Development Security ..............................................................................34

10.2 Seller’s Delivery Term Security ............................................................................34

10.3 First Priority Security Interest in Cash or Cash Equivalent Collateral ..................34

10.4 Seller Financial Information ..................................................................................35

10.5 Buyer Credit Support .............................................................................................35 ARTICLE 11: SAFETY ...............................................................................................................37

11.1 Safety .....................................................................................................................37

11.2 Reporting Serious Incidents ...................................................................................38

11.3 Remediation ...........................................................................................................38 ARTICLE 12: TAXES ..................................................................................................................38

12.1 Taxes ......................................................................................................................38

12.2 Cooperation ............................................................................................................38 ARTICLE 13: LIMITATIONS .....................................................................................................38

13.1 No Consequential Damages ...................................................................................38

13.2 Waiver and Exclusion of Other Damages ..............................................................39 ARTICLE 14: REPRESENTATIONS; WARRANTIES; COVENANTS ...................................40

14.1 Seller’s Representations and Warranties ...............................................................40

14.2 Buyer’s Representations and Warranties ...............................................................41

14.3 General Covenants .................................................................................................42

14.4 Covenants of Seller ................................................................................................42 ARTICLE 15: INDEMNITIES .....................................................................................................43

15.1 Indemnity by Seller ................................................................................................43

15.2 Notice of Claim ......................................................................................................43

15.3 Defense of Claims ..................................................................................................43

15.4 Subrogation of Rights ............................................................................................44

15.5 Rights and Remedies are Cumulative ....................................................................44 ARTICLE 16: INSURANCE ........................................................................................................44

16.1 Insurance ................................................................................................................44

16.2 Evidence of Insurance ............................................................................................46

16.3 Failure to Comply ..................................................................................................46

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ARTICLE 17: RECORDS AND AUDIT RIGHTS......................................................................46

17.1 Operations Logs .....................................................................................................46

17.2 Records and Audit..................................................................................................46

17.3 General Audit Right ...............................................................................................46

17.4 State Auditor ..........................................................................................................46

17.5 Data Request Cooperation .....................................................................................46

17.6 Access Rights .........................................................................................................47 ARTICLE 18: ASSIGNMENT .....................................................................................................47

18.1 General Prohibition on Assignments .....................................................................47

18.2 Collateral Assignment ............................................................................................47

18.3 Permitted Assignment by Seller.............................................................................47

18.4 Permitted Assignment by Buyer ............................................................................47

18.5 Unauthorized Assignment; Costs ...........................................................................48 ARTICLE 19: DISPUTE RESOLUTION ....................................................................................48

19.1 Governing Law ......................................................................................................48

19.2 Dispute Resolution .................................................................................................48 ARTICLE 20: CONFIDENTIAL INFORMATION ....................................................................49

20.1 Confidential Information .......................................................................................49

20.2 Permitted Disclosures ............................................................................................49

20.3 Remedies ................................................................................................................49 ARTICLE 21: GENERAL PROVISIONS ...................................................................................50

21.1 Entire Agreement; Integration; Exhibits ................................................................50

21.2 Amendments ..........................................................................................................50

21.3 Survival ..................................................................................................................50

21.4 Waivers ..................................................................................................................50

21.5 No Agency, Partnership, Joint Venture or Lease ...................................................50

21.6 Severability ............................................................................................................50

21.7 Mobile Sierra .........................................................................................................51

21.8 Counterparts ...........................................................................................................51

21.9 Electronic Delivery ................................................................................................51

21.10 No Recourse to Members of Buyer .......................................................................51

21.11 Lockbox Account ...................................................................................................51

21.12 Forward Contract ...................................................................................................51

21.13 Further Assurances.................................................................................................52 ARTICLE 22: NOTICES ..............................................................................................................52

22.1 Addresses for the Delivery of Notices ...................................................................52

22.2 Time of Delivery ....................................................................................................52

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APPENDICES
Appendix I – Description of Project & Units .............................................................................. I-1 Appendix II –Operational Characteristics ...................................................................................II-1 Appendix III – Progress Reporting Form .................................................................................. III-1 Appendix IV – Certification for Commercial Operation ........................................................... IV-1 Appendix V-A – Form of Letter of Credit .............................................................................. V-A-1 Appendix V-B – Form of Guaranty ........................................................................................ V-B-1 Appendix VI – Project Safety Plan and Documentation ........................................................... VI-1 Appendix VII – MUA Decision Attestation ............................................................................. VII-1 Appendix VIII – Notices ......................................................................................................... VIII-1 Appendix IX – Approved Contractors ....................................................................................... IX-1 Appendix X – Not Used .............................................................................................................. X-1 Appendix XI – Not Used ........................................................................................................... XI-1 Appendix XII – Workforce Development and Community Investment Obligations ............... XII-1

1 Energy Storage Resource Adequacy Agreement Form

ENERGY STORAGE RESOURCE ADEQUACY AGREEMENT

This Energy Storage Resource Adequacy Agreement (“Agreement”) is made by and between the buyer (“Buyer”) and the seller (“Seller”) as of May 24, 2022 (“Effective Date”), in each case as set forth on the cover sheet (“Cover Sheet”) to this Agreement. Seller and Buyer are referred to each individually as a “Party” and collectively as the “Parties.”

RECITALS
WHEREAS, Seller intends to develop, design, permit, construct, own, and operate the Project; and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, on the terms and conditions set forth in this Agreement, the Product;
NOW THEREFORE, in consideration of the mutual covenants and agreements herein contained, and for other good and valuable consideration, the sufficiency and adequacy of which are hereby acknowledged, the Parties agree to the following:

ARTICLE 1: DEFINITIONS

1.1 Contract Definitions . Capitalized terms u sed in this Agreement have the following meanings, unless otherwise specified:
“A ffiliate ” of a Person means any other Person that (a) directly or indirectly controls the specified Person; (b) is controlled by or is under direct or indirect common control with the specified Person; or (c) is an officer, director, employee, representative or agent of the Person. For the purposes of this definition, “control”, when used with respect to any specified Person, means the power to direct the management or policies of the specified Person, directly or indirectly, through one or more intermediaries.
“A
greement ” has the meaning set forth in the preamble.
“Ancillary Services” has the meaning set forth in the CAISO Tariff. “Availability Incentive Payments” has the meaning set forth in the CAISO Tariff. “Availability Standards” has the meaning set forth in the CAISO Tariff. “Balancing Authority” has the meaning set forth in the CAISO Tariff. “Bankrupt” means with respect to any entity, such entity that (a) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar Law, (b) has any such petition filed or commenced against it which remains unstayed or undismissed for a period of ninety (90) days, (c) makes an assignment or any general arrangement for the benefit of creditors, (d) otherwise becomes bankrupt or insolvent (however evidenced), (e) has a liquidator, administrator,

2 Energy Storage Resource Adequacy Agreement Form
receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (f) is generally unable to pay its debts as they fall due. “Bid” has the meaning set forth in the CAISO Tariff.
“Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday in California.
“B uyer” has the meaning set forth in the preamble to this Agreement. “Buyer Group” has the meaning set forth in Section 15.1(a). “Buyer’s Event of Default ” means a Party’s Event of Default where Buyer is the Defaulting Party.
“CAI SO ” means the California Independent System Operator Corporation or any successor entity performing similar functions.
“C AISO Grid ” means th e system of transmission lines and associated facilities of the Participating Transmission Owners that have been placed under the CAISO’s operational control. “C AISO Markets ” has the meaning set forth in the CAISO Tariff. “CAISO Tariff” means the CAISO Fifth Replacement FERC Electric Tariff and protocol provisions, including any CAISO-published procedures or business practice manuals, as they may be amended, supplemented or replaced (in whole or in part) from time to time. “C alifornia State Auditor ” means the auditor that may audit Seller in accordance with Section 17.4.
“Capacity Adjustment Date” has the meaning set forth in Section 6.7(a). “Capacity Attributes” means, any and all of the following attributes of the Project that may be counted toward Compliance Obligations:
(a) RA Attributes,
(b) Local RA Attributes,
(c) Flexible RA Attributes, and
(d) Other Capacity Attributes.
“CARB” means the California Air Resources Board or any successor entity performing similar functions.
“CE C” means the California Energy Commission or any successor entity performing similar functions.

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“CEQA” means the California Environmental Quality Act of 1970. “Change Notice” has the meaning set forth in Section 6.7(a). “Change of Control ” means any circumstance in which esVolta, LP ceases to own, directly or indirectly through one or more intermediate entities, more than fifty percent (50%) of the outstanding equity interests in Seller; provided that in calculating ownership percentages f or all purposes of the foregoing clause:
(a) any ownership interest in Seller held by esVolta, LP indirectly through one or more intermediate entities shall not be counted towards esVolta, LP’s ownership interest in Seller unless esVolta, LP directly or in directly owns more than fifty percent (50%) of the outstanding equity interests in each such intermediate entity; and (b) ownership interests in Seller owned directly or indirectly by any Lender (including any tax equity provider) shall be excluded from the total outstanding equity interests in Seller.
“Charging Energy” means the amount of Energy withdrawn from the Utility Distribution Company’s electrical system, Participating Transmission Owner’s electrical system, the CAISO Grid, or otherwise, to be stored by the Project.
“C
laim s” has the meaning set forth in Section 15.1(a).
“Collateral Agent” has the meaning set forth in the Security Agreement. “Collateral Assignment Agreement” has the meaning set forth in Section 18.2(b). “Commercial Operation Date” means the date stated in Seller’s Notice, substantially in the form of Appendix IV, upon which the Project became Commercially Operable. “Commercial Operation Deadline” means the date that is seventy -five (75) days before the Expected Initial Delivery Date, as set forth on the Cover Sheet. “C ommercial Operation Milestone” means the Project becoming Commercially Operable on or before the Commercial Operation Deadline. “C ommercially Operable” with respect to the Project, is a condition occurring after such time as Mechanical Completion has occurred, commissioning is complete, the Project has been released by the EPC Contractor to Seller for commercial operations, and permission to operate has been formally obtained from the applicable transmission or distribution utility. “C
ompliance Actions ” means actions to comply with Seller’s obligations under the Agreement with respect to obtaining, maintaining, conveying or effectuating Buyer’s use of all of the Capacity Attributes and Resource Adequacy associated with the Project in order for Buyer to meet its Compliance Obligations at levels equal to the Contract Amount , which may include making physical modification to the design of the Project.

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“Compliance Obligations” means the RAR, Local RAR, Flexible RAR, and any other resource adequacy or capacity procurem ent requirements imposed on Load Serving Entities (as defined in the CAISO Tariff) by the CPUC pursuant to the CPUC Decisions, by the CAISO, by the WECC, or by any other Governmental Authority having jurisdiction. “C ompliance Showings ” means the total combination of (a) through (d) below that a Load Serving Entity (as defined in the CAISO Tariff) is required to make to the CPUC pursuant to the CPUC Decisions, or to any Governmental Authority having jurisdiction: (a) Local RAR compliance or advisory showings (or similar or successor showings), (b) RAR compliance or advisory showings (or similar or successor showings), (c) Flexible RAR compliance or advisory showings (or similar or successor showings), and (d) other Capacity Attributes compliance or advisory showings (or similar or successor showings).
“C
onditions Precedent ” has the meaning set forth in Section 4.2. “Confidential Information” has the meaning set forth in Section 20.1. “Confirmation Notice” has the meaning set forth in Section 6.7(a). “Contract Amounts” has the meaning set forth in Section 5.2(a). “Contract Price” means the amount specified in Section 5.2(d). “Contract Year” means a period of twelve (12) consecutive months; the first Contract Year shall commence on the Initial Delivery Date; and each subsequent Contract Year shall commence on the anniversary of the Initial Delivery Date. The final Contract Year may be a period of less than twelve (12) consecutive months.
“C
ontractor ” means the EPC Contractor and its subcontractors, as well as Seller or Seller’s Affiliates if any such entities are developing, constructing, operating or maintaining the Project during the Term, and any Person under contract with Seller or Seller’s Affiliates for the purpose of developing, constructing, operating or maintaining the Project during the Term. “C
osts ” means, with respect to the Non-Defaulting Party, brokerage fees, commissions and other similar third party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements that replace this Agreement; and all reasonable attorneys’ fees and expenses incurred by the Non-Defaulting Party in connection with the termination of this Agreement. “C
over Sheet ” has the meaning set forth in the preamble to this Agreement. “CPM” means “Capacity Procurement Mechanism” and has the meaning set forth i n the CAISO Tariff and is inclusive of any successor mechanisms authorized by CAISO. “C PM Capacity ” has the meaning set forth in the CAISO Tariff. “CPUC” or “Commission ” means the California Public Utilities Commission or any successor entity performing similar functions.

5 Energy Storage Resource Adequacy Agreement Form
“CPUC Decisions” means CPUC Decisions 04-01-050, 04-10-035, 05-10-042, 06-04-040, 06-06-064, 06-07-031, 07-06-029, 08-06-031, 09-06-028, 10-06-036, 11-06-022, 12-06-025, 13- 06-024, 14-06-050, and any other existing or subsequent decisions, resolutions or rulings related to resource adequacy, as may be amended from time to time by the CPUC. “C PUC General Order No. 167” issued by the CPUC directs the implementation and enforcement of standards for the maintenance and operation of electric gen erating facilities and power plants and can be found at the link below:
http://docs.cpuc.ca.gov/PUBLISHED/GENERAL_ORDER/108114.htm “Credit Rating” means, with respect to any entity, the rating then assigned to such entity’s unsecured, senior long-term debt obligations (not supported by third party credit enhancements) or if such entity does not have a rating for its senior unsecured long-term debt, then the rating then assigned to such entity as an issuer rating by S&P or Moody’s. If ratings by S&P and Moody’s are not equivalent, the lower rating shall apply.
“D amage Payment ” means the dollar amount equal to the total amount required to be posted by Seller as Development Security pursuant to Section 10.1. “Defaulting Party” means the Party that is subject to an Event of Default. “Delay Notice” has the meaning set forth in Section 4.1(c)(i). “Delivered Quantities” has the meaning set forth in Section 5.2(c). “Delivery Term” has the meaning set forth in Section 2.2(b). “Delivery Term Security” means (i) cash in an amount equal to forty dollars ($40.00) per kilowatt of the Payment Quantity , (ii) Guaranty in an amount equal to forty dollars ($40.00) per kilowatt of the Payment Quantity , or (iii) a Letter of Credit in an amount equal to forty dollars ($40.00) per kilowatt of the Payment Quantity.
“D evelopment Security ” means (i) cash or (ii) a Letter of Credit in an amount equal to forty dollars ($40.00) per kilowatt of the Payment Quantity. “Dis closing Party” has the meaning set forth in Section 20.2. “Disclosure Order” has the meaning set forth in Section 20.2(a). “Disclosure Request” has the meaning set forth in Section 20.2(b). “Early Termination Date” has the meaning set forth in Section 7.2(a). “EFC” or “Effective Flexible Capacity ” has the meaning given to “Effective Flexible Capacity” in the CAISO Tariff.
“E ffective Date ” has the meaning set forth in the preamble.

6 Energy Storage Resource Adequacy Agreement Form
“Electric System Upgrades ” means any upgrades, including, Network Upgrades, Distribution Upgrades, or Interconnection Facilities (as these terms are defined in the CAISO Tariff), that are determined to be necessary by the CAISO, Participating TO, or Utility Distribution Company as applicable, to physically and electrically interconnect the Project to the Utility Distribution Company’s/Participating TO’s electric system for delivery of Energy from the Project such that the Project can provide Product at all times during the Delivery Term. “E
nergy ” means three -phase, 60- cycle alter nating current electric energy, measured in MWhs.
“E nvironmental Costs ” means costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, and the Product’s and Project’s compliance with all applicable environmental Laws, rules and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product or Project, all operating and maintenance costs for operation of pollution mitigation or control equipment, costs of permit maintenance fees and emission fees as applicable, and the costs of all emission reduction credits, marketable emission trading credits, and any costs related to greenhouse gas emissions, required by any applicable environmental Laws, rules, regulations, and permits to operate, and costs associated with the disposal and clean- up of hazardous substances introduced to a Site or the Project.
“E
PC Contract ” means the Seller’s engineering, procurement and construc tion contract with the EPC Contractor.
“E PC Contractor ” means Seller’s engineering, procurement and construction contractor or such Person performing those functions.
“E vent of Default” means a Seller’s Event of Default , Buyer ’s Event of Default or a Party’s Event of Default.
“E xigent Circumstance” means actual or imminent harm to life or safety, public health, third-party owned property, including a Site, or the environment due to or arising from the Project or portion thereof.
“E xpected Initial Delivery Date ” means the expected initial delivery date set forth on the Cover Sheet.
“F ERC” means the Federal Energy Regulatory Commission or any successor entity performing similar functions.
“F lexible RA Attributes ” means any and all flexible resource adequacy attributes, as may be identified at any time during the Delivery Term by the CPUC, CAISO or other Governmental Authority having jurisdiction that can be counted toward Flexible RAR, exclusive of any RA Attributes, Local RA Attributes, or Other Capacity Attributes. “F
lexible RAR ” means the flexible resource adequacy requirements established for Load Serving Entities (as defined in the CAISO Tariff) by the CPUC pursuant to the CPUC Decisions, or by any other Governmental Authority having jurisdiction.

7 Energy Storage Resource Adequacy Agreement Form
“Force Majeure” means any event or circumstance which wholly or partly prevents or delays the performance of any material obligation arising under this Agreement, but only if and to the extent (x) such event is not within the reasonable control, directly or indirectly, of the Party seeking to have its performance obligation excused thereby, (y) the Party seeking to have its performance obligation excused thereby has taken all reasonable precautions and measures in order to prevent or avoid such event or mitigate the effect of such event on such Party’s ability to perform its obligations under this Agreement and which by the exercise of due diligence such Party could not reasonably have been expected to avoid and which by the exercise of due diligence it has been unable to overcome, and (z) such event is not the direct or indirect result of the negligence or the failure of, or caused by, the Party seeking to have its performance obligations excused thereby. Additionally:
(a) Force Majeure may include:
(i) a cts of God, including landslide, lightning, earthquake, storm, hurricane, flood, drought, tornado, or other natural disasters and weather related events affecting an entire region which caused failure of performance;
(ii) interruptions to supply or transp ortation delays or accidents affecting delivery of equipment caused by an event that would otherwise satisfy the definition of a Force Majeure event as defined above;
(iii) sabotage, riot, acts of terrorism, war and acts of public enemy, epidemics, pandemics and quarantines; or
(v) restraint by court order or other Governmental Authority. (b) Force Majeure does not include:
(i) a failure of performance of any third p arty, including Participating TO, Utility Distribution Company, or any other party providing electric interconnection, distr ibution or transmission service (except to the extent that such failure was caused by an event that would otherwise satisfy the definition of a Force Majeure event as defined above); (ii) breakage or malfunction of equipment (except to the extent that such failure was caused by an event that would otherwise satisfy the definition of a Force Majeure event as defined above);
(iii) a strike, work stoppage or labor dispute limited only to any one or more of Seller, Seller’s Affiliates, the EPC Contractor or subcontractors thereof or any other third party employed by Seller to work on the Project;
(iv) Seller’s ability to sell the Product at a price greater than the price set forth in this Agreement or Buyer’s ability to purchase the Product at a price lower than the price set forth in this Agreement;

8 Energy Storage Resource Adequacy Agreement Form
(v) Seller’s inability to obtain permits or approvals of any type for the operation or maintenance of the Project, unless caused solely by an event of Force Majeure of the specific type described in any of subsections (a)(i) through (a)(iv) above; (vi) Seller’s inability to complete interconnection by the Expected Initial Delivery Date, unless such delay is caused solely by an event of Force Majeure of the specific type described in any of subsections (a)(i) through (a)(iv) above; (vii) Seller’s inability to obtain sufficient Charging Energy, fuel, power or materials to operate the Project, except if Seller’s inability to obtain sufficient Charging Energy, fuel, power or materials is caused solely by an event of Force Majeure of the specific type described in any of subsections (a)(i) through (a)(iv) above; or (viii) Seller’s failure to obtain additional funds, including funds authorized by a state or the federal governmen t or agencies thereof, to supplement the payments made by Buyer pursuant to this Agreement.
“Force Majeure Failure” has the meaning set forth in Section 8.1(d). “Gains” means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of this Agreement. Factors used in determining the economic benefit to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non -Defaulting Party, including without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs, all of which should be calculated for the remaining Delivery Term to determine the value of the Product.
“G
enerally Accepted Accounting Principles ” means the standards for accounting and preparation of financial statements established by the Federal Accounting Standards Advisory Board (or its successor agency) or any successor standards adopted pursuant to relevant SEC rule. “G
overnmental Approval ” means all authorizations, consents, approvals, waivers, exceptions, variances, filings, permits, orders, licenses, exemptions, notices to and declarations of or with any Governmental Authority and shall include those siting and operating permits and licenses, and any of the foregoing under any applicable environmental Law, that are required for the development, use and operation of the Project, including any approvals required under the CEQA.
“Gove
rnmental Authority” means any federal, state, provincial, local or municipal government, any political subdivision thereof or any other governmental, congressional or parliamentary, regulatory, or judicial instrumentality, authority, body, agency, department, bureau, or entity with authority to bind a Party at law, including CAISO; provided, however, that “Governmental Authority” shall not in any event include any Party.

9 Energy Storage Resource Adequacy Agreement Form
“Guarantor” means a Person having a Credit Rating of at least A - with an outlook designation of “stable” from S&P or A3 with an outlook designation of “stable” from Moody’s. “G uaranty” means a guaranty issued by a Guarantor in the form and substance set forth in Appendix V-B or as otherwise deemed acceptable by Buyer. “Hazardous Substance” means, collectively, (a) any chemical, material or substance that is listed or regulated under applicable Laws as a “hazardous” or “toxic” substance or waste, or as a “contaminant” or “pollutant” or words of similar import, (b) any petroleum or petroleum products, flammable materials, explosives, radioactive materials, asbestos, urea formaldehyde foam insulation, and transformers or other equipment that contain polychlorinated biphenyls, and (c) any other chemical or other material or s ubstance, exposure to which is prohibited, limited or regulated by any Laws.
“I
DD Cure Period ” has the meaning set forth in Section 4.1(c)(i). “IDD Delay Damages ” means liquidated damages in an amount equal to (a) the total Development Security amount required hereunder, divided by (b) one hundred eighty (180). “In demnifiable Loss(es) ” has the meaning set forth in Section 15.1(a). “Initial Delivery Date” has the meaning set forth in Section 2.2(b). “Interconnection Agreement” means the agreement(s) and associated documents (or any successor agreement and associated documentation approved by FERC or the CPUC) by and among Seller and, as applicable, the Utility Distribution Company, the Participating Transmission Owner, and the CAISO, governing the terms and conditions of the interconnection of the Project with the Utility Distribution Company’s or CAISO’s grid, including any description of the plan for interconnecting the Project to the applicable grid. “I
ntercreditor and Collateral Agency Agreement ” means that certain Intercreditor and Collateral Agency Agreement, dated as of January 22, 2018, by and among River City Bank, as Collateral Agent, the Secured Creditors from time to time party thereto, and Member. “I
nterest Rate” has the meaning set forth in Section 9.2. “Joinder” has the meaning set forth in the Intercreditor and Collateral Agency Agreement. “Joint Powers Act ” means the Joint Exercise of Powers Act of the State of California (Government Code Section 6500 et seq.).
“J oint Powers Agreement ” means that certain Joint Powers Agreement dated August 12, 2012, as amended, under which Buyer is organized as a Joint Powers Authority in accordance with the Joint Powers Act.
“L
aw ” means any statute, law, treaty, rule, regulation, ordinance, code, Permit, enactment, injunction, order, writ, decision, authorization, judgment, decree or other legal or regulatory determination or restriction by a court or Governmental Authority of competent jurisdiction,

10 Energy Storage Resource Adequacy Agreement Form
including any of the foregoing that are enacted, amended, or issued after the Effective Date, and which become effective during the Term; or any binding interpretation of the foregoing. “Lender” means, collectively, any Person (i) providing senior or subordinated construction, interim, back leverage or long- term debt, equity or tax equity financing or refinancing for or in connection with the development, construction, purchas e, installation or operation of the Project, whether that financing or refinancing takes the form of private debt (including back -leverage debt), equity (including tax equity), public debt or any other form (including financing or refinancing provided to a member or other direct or indirect owner of Seller), including any equity or tax equity investor directly or indirectly providing financing or refinancing for the Project or purchasing equity ownership interests of Seller or its Affiliates for purposes of providing financing or refinancing for the Project, and any trustee or agent or similar representative acting on their behalf, (ii) providing interest rate or commodity protection under an agreement hedging or otherwise mitigating the cost of any of the foregoing obligations or (iii) participating in a lease financing (including a sale leaseback or leveraged leasing structure) with respect to the Project.
“L
etter of Credit ” means one or more irrevocable, standby letters of credit issued by a U.S. commercial bank or a foreign bank with a U.S. branch with such bank having a Credit Rating of at least A- with an outlook designation of “stable” from S&P or A3 with an outlook designation of “stable” from Moody’s, in a form substantially similar to the letter of credit set forth in Appendix V-A.
“LIBOR” means the London Interbank Offered Rate for the corresponding deposits of U.S. dollars.
“L icensed Professional Engineer” means a person acceptable to Buyer in its reasonable judgment who (a) is licensed to practice engineering in California in accordance with applicable Law including Cal. Bus. & Prof. Code §§ 6700 et seq., (b) has training and experience in the power industry specific to the technology of the Project, (c) has no economic or familial relationship, association, or nexus with Seller or Buyer, other than to meet the obligations of Seller pursuant to this Agreement, (d) is not a representative of a consultant, engineer, contractor, designer or other individual involved in the development of the Project or of a manufacturer or supplier of any equipment installed at the Project, and (e) is licensed in an appropriate engineering discipline for the required certification being made.
“L
ocal Capacity Area” has the meaning set forth in the CAISO Tariff. “Local RA Attributes” means any and all resource adequacy attributes or other locational attributes related to a Local Capacity Area, as may be identified at any time during the Delivery Term by the CPUC, CAISO or other Governmental Authority having jurisdiction, associated with a physical location or point of electrical interconnection within the CAISO’s Balancing Authority, that can be counted toward a Local RAR.
“L
ocal RAR” means the local resource adequacy requirements established for Load Serving Entities (as defined in the CAISO Tariff) by the CPUC pursuant to CPUC Decisions, or by any other Governmental Authority having jurisdiction. Local RAR may also be known as local

11 Energy Storage Resource Adequacy Agreement Form
area reliability, local resource adequacy, local resource adequacy procurement requirements, or local capacity requirement in other regulatory proceedings or legislative actions. “Lockbox Account” has the meaning set forth in the Security Agreement. “Lockbox Account Control Agreement ” has the meaning set forth in the Security Agreement.
“L ockbox Arrangement Documents ” means, collectively, the Intercreditor and Collateral Agency Agreement, the Security Agreement, and the Lockbox Account Control Agreement. “L osses” means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of this Agreement .

Factors used in determining economic loss to a Party may include, without limitation, reference to information supplied by one or more third parties, which shall exclude Affiliates of the Non- Defaulting Party, including without limitation, quotations (either firm or indic ative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, comparable transactions, forward price curves based on economic analysis of the relevant markets, settlement prices for comparable transactions at liquid trading hubs, all of which should be calculated for the remaining Delivery Term to determine the value of the Product. If the Non- Defaulting Party is the Seller, then “Losses” shall exclude any loss of federal or state tax credits, grants, or benefits related to the Project or generation therefrom or any costs or fees related to the Site or Project.
“Me
chanical Completion ” means that (a) all components and systems of the Project have been properly constructed, installed and functionally tested according to EPC Contract requirements in a safe and prudent manner that does not void any equipment or system warranties or violate any permits, approvals or Laws; (b) the Project is ready for testing and commissioning, as applicable; and (c) Seller has provided written acceptance to the EPC Contractor of mechanical completion as that term is specifically defined in the EPC Contract. “Mem
ber” means City of San Jacinto .
“Member Lockbox Arrangement” has the meaning set forth in Section 10.5(a). “Member Performance Security” means (a) cash deposited in an escrow agreement on terms and conditions satisfactory to Seller or (b) Letter of Credit , in either case in an amount reasonably agreed to by the Parties.
“M onthly Payment ” or “MP” has the meaning set forth in Section 5.2(d). “Moody’s” means Moody’s Investors Service, Inc., or its successor. “MUA Decision” has the meaning set forth in Section 4.2(m). “Must Offer Obligations ” means Seller’s obligation to Bid or cause Seller’s SC to Bid the Project into the CAISO Markets due to delivery of the Product to Buyer and in accordance with the CAISO Tariff.

12 Energy Storage Resource Adequacy Agreement Form
“MW” means megawatts in alternating current, unless expressly stated in terms of direct current.
“NE RC” means the North American Electric Reliability Corporation or any successor entity performing similar functions.
“No n -Availability Charges” has the meaning set forth in the CAISO Tariff. “Non-Defaulting Party” has the meaning set forth in Section 7.2. “Non-Spinning Reserve” has the meaning set forth in the CAISO Tariff. “Notice” unless otherwise specified in this Agreement, means written communications by a Party to be delivered by hand delivery, United States mail, overnight courier service, or electronic messaging (e-mail).
“N otice of Claim ” has the meaning set forth in Section 15.2(a). “Notify” means to provide a Notice.
“NQC” or “Net Qualifying Capacity” has the meaning given to “Net Qualifying Capacity” in the CAISO Tariff.
“O perational Characteristics ” means the operational characteristics set forth in Appendix II.
“Other Capacity Attributes ” means, exclusive of RA Attributes, Local RA Attributes, and Flexible RA Attributes, any (a) current or future capacity characteristics or attributes, including the ability to generate or charge at given capacity levels, the ability to ramp up or down at a given rate, flexibility or dispatchability attributes, and locational attributes, as may be identified at any time during the Delivery Term by any applicable Law, or voluntary or mandatory program of any Governmental Authority or other Person, (b) certificate, tag, or credit, intended to commoditize or otherwise attribute value resulting from or associated with the characteristics set forth in subsection (a) of this definition, and (c) any accounting construct so that the characteristics or values set forth in subsections (a) or (b) hereof may be counted toward any Compliance Obligations.
“P
articipating Transmission Owner ” or “Participating TO ” means an entity that (a) owns, operates and maintains transmission lines and associated facilities or has entitlements to use certain transmission lines and associated facilities and (b) has transferred to the CAISO operational control of such facilities or entitlements to be made part of the CAISO Grid. “P
arty ” or “Parties” has the meaning set forth in the preamble of this Agreement. “Party’s Event of Default” has the meaning set forth in Section 7.1(b). “Payment Quantity” has the meaning set forth in Section 5.2(d).

13 Energy Storage Resource Adequacy Agreement Form
“Performance Assurance” means collateral provided by Seller to Buyer to secure Seller’s obligations under this Agreement and includes Development Security and Delivery Term Security. “P ermit ” means any waiver, exemption, variance, franchise, permit, authorization, consent, ruling, certification, license or similar order of or from, or filing or registration with, or notice to, any Governmental Authority that authorizes, approves, limits or imposes conditions upon a specified activity.
“P
erson ” means any individual, sole proprietorship, corporation, limited liability company, limited or general partnership, joint venture, association, joint -stock company, trust, incorporated organization, institution, public benefit corporation, unincorporated organization, government entity or other entity.
“P
ricing Node” or “ PNode” has the meaning set forth in the CAISO Tariff. “Product” has the meaning set forth in Section 5.1(a).
“Progress Report” means a reasonably detailed progress report including the items set forth in Appendix III.
“Project” means the energy storage facility described in Appendix I , as such may be revised from time to time in accordance with this Agreement. “P roject Safety Plan ” means Seller’s written plan that includes the Safeguards and plans to comply with the Safety Requirements, as such Safeguards and Safety Requirements are generally outlined in Appendix VI.
“Prudent Operating Practice” means those practices, methods, code s and acts engaged in or approved by a significant portion of the electric power industry and applicable to energy storage facilities during the relevant time period, or any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time a decision is made, that could have been expected to accomplish a desired result at reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practices are not intended to be limited to the optimum practices, methods, or acts to the exclusion of others, but rather to those practices, methods and acts generally accepted or approved by a significant portion of the electric power industry in the relevant region, during the relevant time period, as described in the immediately preceding sentence. Prudent Operating Practices also includes taking reasonable steps to ensure that:
(a) Safeguards are implemented and maintained for the Project and at each Site and are sufficient to address reasonably foreseeable incidents; (b) equipment, material, and supplies are sufficient and accessible to operate the Project safety and reliably;
(c) operating personnel are trained, equipped, and capable of responsible operation and maintenance of the Project and at each Site, including identifying and responding to

14 Energy Storage Resource Adequacy Agreement Form
System Emergencies, e mergencies, or Exigent Circumstances originating from or impacting the Project or Site;
(d) the Project’s material components and control systems are designed, manufactured, and configured to meet the standard of durability and safety generally used for electric power or energy storage facilities operating in the relevant region; and (e) the Project is appropriately designed, operated, maintained, monitored, and tested to ensure it continues to function safely, reliably, and consistent with the intended design specifications, applicable Laws, and Permits, and over the complete range of environmental conditions reasonably expected to occur at each Site.
“RA Attributes” means, any and all resource adequacy attributes, exclusive of any Local RA Attributes, Flexible RA Attributes and Other Capacity Attributes, as may be identified at any time during the Delivery Term by the CPUC, CAISO or other Governmental Authority having jurisdiction, that can be counted toward RAR and Local RAR. “R
eceiving Party ” has the meaning set forth in Section 20.2(b). “Regulation Down” has the meaning set forth in the CAISO Tariff. “Regulation Up” has the meaning set forth in the CAISO Tariff. “Reliability Organization ” means an “Electric Reliability Organization” as defined in Section 215(a)(2) of the Federal Power Act or a “regional entity” as defined in Section 215(a)(7) of the Federal Power Act.
“R emedial Action Plan ” has the meaning set forth in Section 3.5. “Remediation Event” means the occurrence of any of the following with respect to the Project or a Site: (a) an Exigent Circumstance ; (b) a Serious Incident; (c) a change in the nature, scope, or requirements of applicable Laws, Permits, codes, standards, or regulations issued by Governmental Authorities which requires modifications to the Safeguards; (d) a material change to the manufacturer’s guidelines that requires modification to equipment or the Project’s operating procedures; (e) a failure or compromise of an existing Safeguard; (f) Notice by Buyer pursuant to Section 11.1 that the Project Safety Plan is not consistent with the Safety Requirements; or (g) any actual condition related to the Project or a Site that would reasonably be expected to adversely impact the safe construction, operation, or maintenance of the Project or a Site. “R
emediation Period ” means the time period between the first occurrence of the Remediation Event and the resolution of such Remediation Event which period may not exceed a total of ninety (90) days; provided, however, that Seller may request to extend the Remediation Period by up to ninety (90) days if Seller is unable to resolve the Remediation Event within the initial ninety (90) day period despite exercising diligent efforts (and Buyer shall not unreasonably withhold approval of such extension), and Seller may request an additional extension of the Remediation Period of up to ninety (90) days if Seller is unable to resolve the Remediation Event within the ninety (90) day extension period despite exercising diligent efforts, which Buyer may approve or reject in its sole discretion. The Remediation Period may not, under any circumstance,

15 Energy Storage Resource Adequacy Agreement Form
continue for more than two hundred and seventy (270) days from the first occurre nce of the Remediation Event.
“Requirements” means Prudent Operating Practices and all applicable requirements of Law, the Utility Distribution Company, the Transmission Provider, Governmental Approvals, the CAISO, CPUC, CARB, FERC, NERC and WECC.
“R esold Product ” has the meaning set forth in Section 5.1(b). “Resource Adequacy ” means the procurement obligation of load serving entities, including Buyer, as such obligations are described in CPUC Decisions D.04-10-035 and D.05-10- 042 and subsequent CPUC decisions addressing Resource Adequacy issues, as those obligations may be altered from time to time, and all other capacity procurement obligations established by any other entity, including the CAISO.
“R
esource Adequacy Plan ” has the meaning set forth in the CAISO Tariff. “Resource Adequacy Requirement ” or “RAR” means the Resource Adequacy or successor program requirements established by the CPUC, CAISO or any other regional entity, including submission of a Supply Plan or Resource Adequacy Plan. “R
MR ” means “Reliability Must-Run” and has the meaning set forth in, and as used in, the CAISO Tariff.
“R MR Contract ” has the meaning set forth in the CAISO Tariff. “RMR Generation” has the meaning set forth in the CAISO Tariff. “S&P” means Standard and Poor’s Financial Services, LLC (a subsidiary of The McGraw- Hill Companies, Inc.) or its successor.
“S afeguard ” means any procedures, practices, or actions with respect to the Project, a Site or Work for the purpose of preventing, mitigating, or containing foreseeable accidents, injuries, damage, release of hazardous material or environmental harm. “S
afety Remediation Plan ” means a written Notice from Seller to Buyer containing information about a Remediation Event, including (a) the date, time and location of first occurrence, (b) the circumstances surrounding cause, (c) impacts, and (d) detailed information about Seller’s plans to resolve the Remediation Event.
“S
afety Requirements ” means Prudent Operating Practices, CPUC General Order No. 167, and all applicable safety- related (construed broadly) requirements of Law, the Utility Distribution Company, the Transmission Provider, Governmental Approvals, the CAISO, CARB, FERC, NERC and WECC.
“Sc
heduling Coordinator ” or “SC” has the meaning set forth the CAISO Tariff. Under the terms of this Agreement, the SC may be Seller or Seller’s designated agent (i.e., a third-party).

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“SEC” means the U.S. Securities and Exchange Commission, or any successor entity performing similar functions.
“S ecurity Agreement ” means the Security Agreement, dated as of January 22, 2018, between Member and Collateral Agent, as collateral agent for the benefit of the Secured Creditors, or any successor agreement generally available to Member’s creditors. “S ecurity Interest ” has the meaning set forth in Section 10.3(a). “Seller” has the meaning set forth in the preamble to this Agreement. “Seller’s Event of Default” has the meaning set forth in Section 7.1(a). “Serious Incident” means a harmful event that occurs on a Site during the Term arisi ng out of, related to, or connected with the Project or the Site that results in any of the following outcomes: (a) any injury to or death of a member of the general public; (b) the death or permanent, disabling injury to operating personnel, Seller’s Contractors or subcontractors, Seller’s employees, agents, or consultants, or authorized visitors to the Site; (c) any property damage greater than three hundred thousand dollars ($300,000.00); (d) release of hazardous material above the limits, or violating the requirements, established by Permits, codes, standards, regulations, Laws or Governmental Authorities; (e) environmental impacts exceeding those authorized by Permits or applicable Law.
“Se
ttlement Amount ” means the Non -Defaulting Party’s Costs and Losses, on the one hand, netted against its Gains, on the other. If the Non-Defaulting Party’s Costs and Losses exceed its Gains, then the Settlement Amount shall be an amount owing to the Non- Defaulting Party. If the Non-Defaulting Party’s Gains exceed its Costs and Losses, then the Settlement Amount shall be zero dollars ($0). The Settlement Amount does not include consequential, incidental, punitive, exemplary or indirect or business interruption damages. “S
hortfall ” means any difference between a Delivered Quantity and a Contract Amount. “Showing Month” incorporates each day of each calendar month of the Delivery Term that is the subject of the Compliance Showings, as set forth in the CPUC Decisions. For illustrative purposes only, pursuant to the CPUC Decisions in effect as of the Effective Date, the monthly Compliance Showings made in June are for the Showing Month of August and the annual Compliance Showing made in October is for the twelve (12) Showing Months of the following year.
“S
ite(s)” means th e real property on which the Project is located, as identified in Appendix I.
“Site Control ” means that Seller owns the Site and the Project or has demonstrable contractual real property rights to the Site sufficient for the permitting, control, development and operation of the Project.
“Spi
nning Reserve ” has the meaning set forth in the CAISO Tariff.

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“Standalone Energy Storage Incentives” means (a) all federal tax credits associated with the construction or ownership from the Facility (including credits under Sections 38, 45, 46 and 48 of the Internal Revenue Code of 1986, as amended), and (b) any federal, subsidies or other like benefits relating in any way to the Facility, including a cash grant available under Section 1603 of Division B of the American Recovery and Reinvestment Act of 2009, in lieu of federal Tax credits or any similar or substitute payment available under subsequently enacted federal legislation. “Suppl
y Plan” has the meaning set forth in the CAISO Tariff.
“Supplying Party” has the meaning set forth in Section 20.2(b). “System Emergency” has the meaning set forth in the CAISO Tariff. “Tax” or “Taxes ” means all U.S. federal, state and local and any foreign taxes, levies, assessments, surcharges, duties and other fees and charges of any nature imposed by a Governmental Authority, whether currently in effect or adopted during the Term, including ad valorem, excise, franchise, gross receipts, import/export, license, property, sales and use, stamp, transfer, payroll, unemployment, income, and any and all items of withholding, deficiency, penalty, additions, interest or assessment related thereto. “T
erm ” has the meaning set forth in Section 2.2(a).
“Terminated Transaction” has the meaning set forth in Section 7.2(a). “Termination Payment” has the meaning set forth in Section 7.3. “Transmission Provider” means the CAISO.
“Utility Distribution Company” has the meaning set forth in the CAISO Tariff. “WECC” means the Western Electricity Coordinating Council or its successor entity with similar functions.
“Wor k ” means (a) work or operations performed by a Party or on a Party’s behalf; and (b) materials, parts or equipment furnished in connection with such work or operations; including (i) warranties or representations made at any time wit h respect to the fitness, quality, durability, performance or use of “a Party’s work”; and (ii) the providing of or failure to provide warnings or instructions.

1.2 R
ules of I nterpretation. In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement; (b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders;

18 Energy Storage Resource Adequacy Agreement Form
(c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) a reference to an article, section, paragraph, clause, Party, appendix, or exhibit is a reference to that section, paragraph, clause of, or that Party, appendix, or exhibit to, this Agreement unless otherwise specified;
(e) a reference to a document or agreement, including this Agreement means such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the term “including” means “including without limitation” and any l ist of examples following such term shall in no way restrict or limit the generality of the work or provision in respect of which such examples are provided; (h) references to any statute, code or statutory provision are to be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or reenacted, and include references to all bylaws, instruments, orders and regulations for the time being made thereunder or deriving validity therefrom unless the context otherwise requires; (i) in the event of a conflict, a mathematical formula or other precise description of a concept or a term shall prevail over words providing a more general description of a concept or a term;
(j) references to any amount of money shall mean a reference to the amount in United States Dollars;
(k) words, phrases or expressions not otherwise defined herein that (i) have a generally accepted meaning in Prudent Operating Practice shall have such meaning in this Agreement or (ii) do not have well known and generall y accepted meaning in Prudent Operating Practice but that have well known and generally accepted technical or trade meanings, shall have such recognized meanings;
(l) the terms “year” and “calendar year” mean the period of months from January 1 through and including December 31; the term “month” means a calendar month unless otherwise indicated, and a “day” means a 24 -hour period beginning at 12:00:01 a.m. and ending at 12:00:00 midnight; provided that a “day” may be 23 or 25 hours on those days on which daylight savings time begins or ends, respectively;
(m) unless otherwise specified herein, where the consent of a Party is required, such consent shall not be unreasonably withheld or unreasonably delayed;

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(n) when an action is required to be completed on a Business Day, such action must be completed prior to 5:00 p.m. on such day, Pacific Standard time, and actions occurring after 5:00 p.m. (such as the delivery of a Notice) will be deemed to have occurred on the following Business Day;
(o) all references to Product mean each and all components of the Product unless the context infers a particular component of Product; and (p) each Party acknowledges that it was represented by counsel in connection with this Agreement and that it or its counsel reviewed this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement.

ARTICLE 2: TERM

2.1 Effectiveness.
(a) Upon Effective Date.
(i) Upon execution by both Parties, this Agreement shall be in full force and effect, enforceable and binding in all respects as of the Effective Date. (ii) Seller shall deliver to Buyer on or before the Effective Date correct and complete copies of: (A) Seller’s most recent annual report, audited consolidated financial statements, and unaudited consolidated financial statements; and (B) Seller’s organizational documents (including any certification of formation, certification of incorporation, charter, operating agreement, partnership agreement, bylaws, or similar documents) and any amendments thereto.

2.2 Term.
(a) The “Term” of this Agreement shall commence upon the Effective Date and shall continue until the expiration of the Delivery Term (unless terminated earlier in accordance with the terms of this Agreement).
(b) T
he “Delivery Term ” is the period commencing on the Initial Delivery Date and continuing for the number of Contract Years specified on the Cover Sheet. The “Initial Delivery Date” is the first day of the first Showing Month for which Product is delivered; provided that the Initial Delivery Date may not occur until satisfaction of the Conditions Precedent , as set forth in Article 4.

ARTICLE 3: PROJECT DEVELOPMENT

3.1 Project Construction.
(a) Seller has achieved Site Control as of the Effective Date.

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(b) Seller shall develop, design and construct the Project in timely fashion in order to perform Seller’s obligations under this Agreement. (c) Seller has caused the following to occur as of the Effective Date (“Construction Start ”): (i) acquisition of all Governmental Approvals neces sary for the construction of the Project, (ii) engagement of each Contractor, (iii) execution of the EPC Contract and issuance of a full notice to proceed thereunder that authorizes the C ontractor to mobilize to the Site and begin physical construction (including, at a minimum, excavation for foundations or the installation or erection of improvements , as applicable) at the Site, and (iv) ordering of all essential equipment and supplies, in each case (i) -(iv), as reasonably necessary so that physical construction of the Project may begin and proceed to completion without foreseeable interruption of material duration.

3.2 I nterconnection . Seller has executed and delivered all necessary Interconnection Agreements as of the Effective Date. Seller shall ( a) comply with all terms and conditions contained in the Interconnection Agreement as necessary for the safe and reliable delivery of the Product and ( b) arrange, schedule and be responsible for any and all electric distr ibution and transmission service including any Governmental Approvals required for the foregoing. Seller shall fulfill all contractual, metering and applicable interconnection requirements, including Electric System Upgrades and those requirements set for th in the Utility Distribution Company’s applicable tariffs, the Participating Transmission Owner’s applicable tariffs, the CAISO Tariff and implementing CAISO standards and requirements, so as to be able to deliver the Product to Buyer.

3.3 Met
ering . At Seller’s expense, Seller shall obtain and maintain a single CAISO resource ID dedicated exclusively to the Project and shall install, or cause to be installed, all necessary metering and telemetry required by the CAISO to deliver the Product.

3.4 P rogress Reports . Within fifteen (15) days after the close of each calendar quarter, starting with the first calendar quarter following the Effective Date and until the Commercial Operation Date, Seller shall provide to Buyer a Progress Report in a Notice and agree to regularly scheduled meetings between representatives of Buyer and Seller to review such quarterly reports and discuss Seller’s progress.

3.5 R emedial Action Plans . If Seller anticipates that it will not be able to timely satisfy the Commercial Operation Milestone , except as the result of Force Majeure or a Buyer’s Event of Default, Seller shall submit to Buyer no later than thirty (30) days prior to the relevant deadline a remedial action plan (“Remedial Action Plan”), which will describe in detail the actual delay, any anticipated delay beyond the scheduled deadline, the cause of the delay , and Seller’s proposed course of action to achieve the Initial Delivery Date by the Expected Initial Delivery Date. D elivery of a Remedial Action Plan shall not relieve Seller of any obligation under this Agreement.

3.6 St andalone Energy Sto rage Incentives. Seller shall have exclusive rights to any Standalone Energy Storage Incentives and Buyer shall not own nor have the right to share in any benefits associated with such Standalone Energy Storage Incentives.

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ARTICLE 4: INITIAL DELIVERY DATE

4.1 Timing of the Initial Delivery Date.
(a) Timely Initial Delivery Date. Seller shall cause t he Initial Delivery Date to occur on, and not prior to, the Expected Initial Delivery Date. (b) E arly Initial Delivery Date . If Seller wishes for the Initial Delivery Date to occur prior to the Expected Initial Delivery Date, Seller may provide Buyer w ith a written request for a specified earlier date, so long as such written request is provided at least one (1) year prior to the Expected Initial Delivery Date. If Buyer agrees to the requested earlier date, the Parties shall execute a written amendment to this Agreement memorializing the agreement that each reference to the Expected Initial Delivery Date in this Agreement shall thereafter be deemed a reference to such earlier date.
(c) F
ailure to Meet Expected Initial Delivery Date.
(i) Seller shall provide Buyer with advance Notice of an y delay in achieving the Initial Delivery Date on the Expecte d Initial Delivery Date , including a true and reasonably detailed explanation of the cause of such delay (“Delay Notice”), at least ninety (90) days in advance of the Expected Initial Delivery Date (or, if Seller’s anticipation of such delay does not arise until after such advance window, then as soon as reasonably possible following such anticipation arising). For each day beginning with the day after the Expected Initial Delivery Date until and including the date on which the Initial Delivery Date occurs, for a period beyond the Expected Initial Delivery Date lasting no more than one hundred eighty (180) days (“ IDD Cure Period”), Seller shall pay IDD Delay Damages to Buyer. Buyer shall invoice Seller for the amount of any IDD Delay Damages. Buyer may draw any IDD Delay Damages that are due to Buyer from the Development Security after providing an invoice for the amounts due . Notwithstanding the foregoing, if Seller fails to achieve the Initial Delivery Date by the Expected Initial Delivery Date due to Force Majeure or a Buyer’s Event of Default, subject to the notice requirements in Section

8.1, the IDD Cure Period shall be ex tended on a day- for-day basis for such events, and no IDD Delay Damages shall be required to be paid for such period of delay due to Force Majeure or Buyer’s Event of Default.
(ii) Each Party agrees that (A) the damages that Buyer would incur due to Seller’s delay in achieving the Expected Initial Delivery Date would be difficult or impossible to predict with certainty and (B) the IDD Delay Damages are an appropriate approximation of such damages.

4.2 Conditions Precedent to the Initial Delivery Date. Seller shall take all actions and obtain all approvals necessary to meet the obligations of this Agreement and to deliver the Product to Buyer pursuant to the terms of this Agreement. The following obligations of Seller are conditions precedent to the Initial Delivery Date (collectively, the “Conditions Precedent”) and must be satisfied at least seventy-five (75) days before the Initial Delivery Date, unless a different deadline is set forth below, in which case such other deadline shall govern, to Buyer’s reasonable satisfaction:

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(a) Seller shall have provided to Buyer updated correct and complete copies of the items identified in Section 2.1(a)(ii).
(b) Seller shall have secured all CAISO and Governmental Approvals as are necessary for the safe and lawful operation and maintenance of the Project and to enable Seller to deliver the Product to Buyer, including at the Contract Amounts. (c) Seller has secured and maintained Site Control.
(d) On or before the Commercial Operation Deadline, Seller shall have caused the Project to become Commercially Operable.
(e) Seller shall have provided to Buyer a certification of Seller and a Licensed Professional Engineer, substantially in the form attached hereto as Appendix IV, demonstrating (i) that the Commercial Operation Date has occurred and (ii) satisfactory completion of the Project at the Site.
(f) Seller shall have provided to Buyer all documentation reasonably acceptable to Buyer demonstrating that the Project successfully completed all applicable testing and registration procedures required by CAISO to Bid into the CAISO Markets. (g) Seller shall have executed and complied with any necessary Interconnection Agreement(s) and installed any necessary metering to deliver Product to Buyer, in each case in accordance with the CAISO Tariff and any applicable tariffs of the Utility Distribution Company and the Participating Transmission Owner.
(h) On or before the Initial Delivery Date, Seller shall have provided Delivery Term Security to Buyer as required by Section 10.2.
(i) As of the Initial Delivery Date, n o Event of Default on the part of Seller shall have occurred and be continuing and no Remediation Event shall have occurred and remain unresolved.
(j) Seller shall have submitted to Buyer a Project Safety Plan. (k) Seller shall have obtained certification of Product in accordance with the CAISO Tariff and CPUC requirements applicable to Product (i) resulting in certifications of not less than the Contract Amounts and (ii) so as to ensure the Project is fully deliverable such that Seller is able to deliver Product in the Contract Amounts to Buyer for purposes of counting towards Buyer’s Compliance Obligations.
(l) As of the dates required under Section 5.2(b) and Section 5.2(c) , as applicable, (i) Seller shall have submitted, or shall have caused its SC to have submitted, a Notice to Buyer including Seller’s proposed Supply Plan for the first Showing Month in accordance with Section 5.2(b) and (ii) Seller shall have submitted, or shall have caused its SC to have submitted, a Supply Plan to CAISO in accordance with Section 5.2(c).

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(m) Seller shall have provided to Buyer an attestation, in the form attac hed hereto as Appendix VII, that Seller is following all of the rules set forth in CPUC Decision 18-01- 003 on Multiple -Use Application Issues, issued January 17, 2018, regarding the multiple -use applications of energy storage facilities (the “MUA Decision”). (n) Seller shall have delivered to Buyer all insurance documents required under Article 16.
(o) As of the Initial Delivery Date, Seller shall have paid Buyer for all amounts owing under this Agreement, if any, including IDD Delay Damages, if any.

4.3 Cooperation in Connection with Initial Delivery Date . The Parties agree that, in order for Seller to achieve the Initial Delivery Date, the Parties may have to perform certain of their Delivery Term obligations in advance of the Initial Delivery Date. The Parties shall cooperate with each other in order for Buyer to be able to utilize the Product beginning on the Initial Delivery Date and Seller agrees to cause the Project’s SC to cooperate in order to achieve the same.

4.4 C onfirmation of Initial Delivery Date . Once each of the Conditions Precedent has been satisfied by Seller (other than any Condition Precedent that may only be satisfied as of the Initial Delivery Date), Seller shall certify such satisfaction to Buyer in a Notice confirming the anticipated occurrence of the Initial Delivery Date. Buyer shall Notify Seller of any disagreement that Seller has satisfied such Conditions Precedent (with reasonable detail in regard to each Condition Precedent) within fifteen (15 ) Business Days of Seller’s Notic e. On or promptly following the Initial Delivery Date (in no event later than five (5) Business Days thereafter), Buyer shall provide a Notice to Seller confirming the occurrence of the Initial Delivery Date.

ARTICLE 5: TRANSACTION

5.1 Product.
(a) During the Delivery Term, Seller grants, pledges, assigns and otherwise commits and shall deliver to Buyer, for Buyer’s exclusive use, all Capacity Attributes that may be calculated or derived from the Operational Characteristics, which must be exclusively from the Project ( collectively, the “ Product”), pursuant to the terms and conditions contained herein.

Operational Characteristics shall not be modified during the Term. (b) In addition to the Capacity Attributes, the Product includes the exclusive right to claim the Contract Amounts as an incremental resource for purposes of CPUC D.21-06- 035. During the Delivery Term Buyer shall have the exclusive right to claim the Contract Amounts as an incremental resource for purposes of CPUC D.21-06-035. (c) Buyer shall have the right to re-sell all or a portion of the Product purchased under this Agreement (“Resold Product”).
(d) Product does not confer to Buyer any right to dispatch or receive Energy or Ancillary Services from the Project.

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5.2 Purchase and Sale Obligation.
(a) For each day of each Showing Month during the Delivery Term, Seller agrees to deliver all Capacity Attributes of Product to Buyer, including in the amounts and categories set forth on the Cover Sheet (“Contract Amounts”). (b) No later than fifteen (15) Business Days prior to the applicable Compliance Showing deadlines for each Showing Month, Seller shall submit, or cause its SC to submit, a Notice to Buyer which includes Seller’s proposed Supply Plan for such Showing Month in a format and to a platform as Notified by Buyer to Seller prior to such deadline. No later than ten (10) Business Days before the applicable Compliance Showing deadlines for each Showing Month, Buyer may Notify Seller of any administrative or typographical corrections to the Supply Plan and Seller shall implement any such corrections in the Supply Plan that it submits, or causes to be submitted, to the CAISO. In the event that Buyer does not Notify Seller of any such corrections to the proposed Supply Plan, Seller shall submit the Supply Plan to CAISO as it was proposed by Notice to Buyer.
(c) After following the procedure in Section 5.2(b), Seller shall submit, or cause to be submitted, a Supply Plan to CAISO, in accordance with the applicable Compliance Showing deadlines for each Showing Mont h, to identify and confirm the Product to be delivered to Buyer (or, with regard to Resold Product, Buyer’s designee) for each day within the applicable Showing Month. For each of the Capacity Attributes of Product that Seller submits in its Supply Plan in the applicable Showing Month, Seller shall not submit an amount greater than the Contract Amount of each of the respective Capacity Attributes. The lowest daily quantity that Seller submits for each of the Capacity Attributes in a Supply Plan shall be deemed to be the amount of the respective Capacity Attributes that Seller has delivered for such Showing Month (“Delivered Quantities”). (d) For all Capacity Attributes of the Product that Seller delivers during the Delivery Term in accordance with this Agreement, Buyer shall, in accordance with Article 9, pay Seller a monthly payment (“Monthly Payment” or “MP”) as follows:

MP = (DQ / CA) × PQ × CP
where,
DQ = The sum of the Delivered Quantities of all RA Attributes, Local RA Attributes, and Flexible Attributes;
CA = The sum of the Contract Amounts of all RA Attributes, Local RA Attributes, and Flexible Attributes;
PQ = The payment quantity set forth on the Cover Sheet (“ Payment Quantity”); and
CP = The contract price set forth on the Cover Sheet (“Contract Price”).

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5.3 Allocation of CAISO Payments and Costs.
(a) Except as may otherwise be provided in this Agreement, Seller shall retain any revenues it may receive from and pay all costs charged by, the CAISO or any other third party with respect to the Product or Project.
(b) To the extent that the Project is subject to the terms of the Availability Standards, Non-Availability Charges, and Availability Incentive Payments of the CAISO Tariff, the Parties agree that any Availability Incentive Payments are for the benefit of Seller and for Seller’s account and that any Non- Availability Charges are the responsibility of Seller and for Seller’s account.

ARTICLE 6: OPERATIONS

6.1 Operations. Seller shall at all times retain operational control of the Project and be responsible for operation and maintenance of the Project.

6.2 C harging Energy. Seller shall be responsible for procuring and delivering all of the Charging Energy to the Project and paying all of the associated costs of such Charging Energy.

6.3 S tandard of Care . In performing all of its obligations under this Agreement, including in its scheduling, interconnection, operation and maintenance of the Project, Seller shall comply with all Requirements and Safety Requirements.

6.4 B
uyer’s Compliance Obli gations; Certification of Product. (a) During the Term, Seller shall take all actions, including executing all documents or instruments, complying with all applicable registration, certification and reporting requirements of all applicable Governmental Authorities and other Persons, as such requirements may be amended from time to time, that are necessary to ensure that Buyer can use Product, including enabling Buyer to apply Product towards Buyer’s Compliance Obligations, or sell Resold Product, at all times during the Delivery Term. Promptly following Buyer’s written request, Seller agrees to take all actions and execute or provide any documents, information, or instruments with respect to Product reasonably necessary to enable Buyer to comply with the requirements of any Governmental Authority.
(b) During the Delivery Term, Seller shall, at no cost to Buyer, obtain and maintain CAISO and all applicable Governmental Authority certification(s) for all elements of the Product for which certification is or may become required in order to enable Buyer to receive and use such Product, including use of such Product to satisfy its Compliance Obligations. If Buyer is required under applicable Law to obtain such certification, Seller shall take all actions within its control to ensure that Buyer is able to secure such certification. Seller, at no cost to Buyer, shall take all other actions during the Delivery Term, including submission of all reports and other filings with CAISO and applicable Governmental Authorities, that are required to be taken by Seller to ensure that Buyer can receive the Product and shall take all actions within its control to assist Buyer in taking actions required to be taken by Buyer with regard to receipt of Product.

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6.5 Scheduling.
(a) Seller shall be the SC or shall designate a qualified third party to fulfill such role for the Project in order to deliver Product to Buyer during the Delivery Term in accordance with the terms of this Agreement. Seller shall be solely responsible for all costs associated with the SC. Seller shall take, or cause its SC to take, all necessary steps to qualify itself and the Project in such other manner identified and approved by the CAISO and CPUC that permits Seller to provide Product to Buyer.
(b) Seller sh all comply, and shall cause SC to comply, with all applicable CAISO Tariff provisions, CPUC Decisions and all other applicable rules, requirements or L aws, including any Bidding of the Project to meet any Must Offer Obligations , in order to deliver the Product to Buyer and allow Buyer to use the Product to satisfy Buyer’s Compliance Obligations. (c) Buyer shall have no liability for the failure of Seller or SC to comply with any applicable Law, Requirements, or other requirement of the Transmission Provider or Utility Distribution Company, including any penalties, charges or fines imposed for such noncompliance except to the extent that such noncompliance is due to Buyer’s failure to comply with its obligations under this Agreement . In no event shall Buyer be required to use or change its utilization of its owned or controlled assets or market positions to minimize a Shortfall. (d) Seller shall not accept, and shall cause the Project ’s SC to not accept, any proposed CPM or RMR designation by the CAISO unless and until Buyer has agreed to accept such designation in a Notice. In addition, Seller shall promptly N otify, or cause the Project’s SC to promptly N otify, Buyer within one (1) Business Day of the time Seller or the SC receives a proposal from CAISO to designate any portion of the Product as CPM Capacity or RMR Generation. During the Delivery Term, Buyer has exclusive right to enter into a RMR Contract with respect to the Product or any component thereof, provided that the RMR Contract would not require the Project to operate beyond the O perational Characteristics or beyond the end of the Delivery Term.

6.6 Information Sharing and Shared Learning . Seller understands and acknowledges that Buyer is entering into this Agreement in part to gain operational and market information regarding the performance, efficiency, operations, maintenance, and multiple uses of energy storage and storage assets as an integral part of Buyer’s portfolio of assets to meet its customers’ needs as well as to gain an understanding of the impact of energy storage on load forecasting as a load serving entity. Throughout the Delivery Term, Seller agrees to share such information with Buyer, including meter data and hourly charging and discharging data but excluding cost or similar proprietary information, upon Buyer’s request, with such information to be treated by Buyer as Confidential Information. Seller shall provide such applicable meter data to Buyer in a format and to a platform specified by Buyer that is reasonably acceptable to Seller.

For information related to Seller’s multiple uses of the Project, Seller shall promptly pro vide Notice to Buyer any time it provides any services, attributes, or products from the Project to a third party.

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6.7 Changes in Law.
(a) In the event of any change in Requirements by the CPUC, CAISO, or other Governmental Authority or Person (in each case, other than a Party) having jurisdiction over Capacity Attributes that results in an increase or decrease to the amount of Capacity Attributes (other than Other Capacity Attributes) that may be calculated or d erived from the Operational Characteristics (including in the case of a new category of Capacity Attributes) , then either Party shall provide Notice to the other Party as soon as practicable following knowledge of such change specifying the altered amounts of Capacity Attributes of Product (“Change Notice”). Following a Change Notice, Buyer will confirm via Notice to Seller the amended Contract Amounts and Payment Quantity based on such change and the date that Seller shall commence delivery of such amended amounts (“ Confirmation Notice ”); provided that, in the case of an increase to the amount of Capacity Attributes that may be calculated or derived from the Operational Characteristics, Buyer shall have sole discretion over whether to accept a corresponding increase to any Contract Amount and the Payment Quantity; provided further that, if Buyer declines to accept any such increase, Seller shall have the right to sell to third parties any Capacity Attributes resulting from such increase that are in excess o f the Contract Amounts. The Contract Amounts and Payment Quantity shall automatically adjust upon the date set forth in the Confirmation Notice (“Capacity Adjustment Date ”) without further need for the Parties to amend this Agreement.

Until the Capacity Adjustment Date, Seller shall continue to deliver the Contract Amounts of the Capacity Attributes of Product as stated prior to the Confirmation Notice , unless otherwise required by Law or other Requirements . In the event that Buyer disputes the altered amounts of Capacity Attributes that may be calculated or derived from the Operational Characteristics as set forth in the Change Notice, the Parties shall resolve such dispute in accordance with the dispute resolution procedures set forth in Section 19.2.

Notwithstanding the provisions of this Section 6.7(a) , i f Buyer sends a Change Notice that indicates that a decrease to the amount of Capacity Attributes will trigger a reduction of the total Monthly Payments that Seller will receive for the twelve (12)-month period following the Capacity Adjustment Date by ten percent (10%) or more of the total Monthly Payments received by Seller in the immediately preceding twelve (12) -month period, then Seller may send a Notice to Buyer of its intent to terminate this Agreement. Buyer and Seller shall then engage in good faith negotiations to resolve the effects of the change to the Requirements with respect to the Capacity Attributes and the percentage reduction of total Monthly Payments, if any. If Buyer and Seller are unable, within sixty (60) days after delivery of such Notice, to agree upon changes to this Agreement or to resolve issues relating to the change in Requirements with respect to the Capacity Attributes, then Seller may send a Notice designating a day, no earlier than the day such Notice is deemed to be received and no later than twenty (20) days after such Notice is deemed to be received, as an early termination date of this Agreement. If Seller terminates this Agreement pursuant to this Section 6.7(a), then neither Party shall have any further liability to one another other than with respect to any liabilities or obligations that have accrued as of the date of termination set forth in the Notice. Notwithstanding the foregoing, Seller shall have no right to terminate this Agreement pursuant to this provision if, and for so long as, Buyer has received a Confirmation Notice and Buyer agrees to pay a Monthly Payment equal to ninety percent (90%) of the amount that is equal to the total Monthly Payments received by Seller in the immediately preceding twelve (12)-month period, divided by twelve (12).

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(b) In the event a centralized capacity market develops within the WECC region, Buyer will have exclusive right to offer, bid, or otherwise submit the Product for re-sale in such markets, or to cause Seller or Seller’s SC to do so, and Buyer shall retain and receive any and all related revenues.
(c) If a change in CAISO , CPUC or other Governmental Authority Requirements renders this Agreement or any provisions hereof incapable of being performed or administered, then either Party may request that Buyer and Seller enter into negotiations to make the minimum changes to this Agreement necessary to make this Agreement capable of being performed and adminis tered, while attempting to preserve to the maximum extent possible the benefits, burdens, and obligations set forth in this Agreement as of the Effective Date. Upon delivery of such a request, Buyer and Seller shall engage in such negotiations in good fai th. If Buyer and Seller are unable, within sixty (60) days after delivery of such request, to agree upon changes to this Agreement or to resolve issues relating to changes to this Agreement, then either Party may submit issues pertaining to changes to this Agreement to the dispute resolution process set forth in Section 19.2. Notwithstanding the foregoing, (i) a change in cost shall not in and of itself be deemed to render this Agreement or any of the provisions hereof incapable of being performed or admi nistered, or constitute, or form the basis of, a Force Majeure, and (ii) all of unaffected provisions of this Agreement shall remain in full force and effect during any period of such negotiation or dispute resolution.

ARTICLE 7: EVENTS OF DEFAULT; REMEDIES

7.1 Events of Default.
(a) Seller will be deemed a Defaulting Party upon the occurrence of any of the following (each, a “Seller’s Event of Default”):
(i) Seller fails to satisfy a Performance Assurance requirement set forth in Article 10 and Seller fails to provide replacement Performance Assurance within ten (10) Business Days of Buyer’s written demand therefor in accordance with Article 10; (ii) any material misrepresentation or omission, in any metering or submetering, Supply Plan, report, or Notice with regard to delivery of the Product, or undue delay or withholding of such data, report or N otice, which misrepresentation or undue delay or withholding is not cured within ten (10) Business Days of Buyer’s receipt thereof; (iii) Seller intentionally or knowingly delivers, or attempts to deliver Product that is not produced by the Project;
(iv) Seller fails to pay IDD Delay Damages in accordance with Section

4.1(c);
(v) Seller fails to achieve the Initial Delivery Date prior to the expiration of the IDD Cure Period, as such IDD Cure Period may be extended for Force Majeure or a Buyer’s Event of Default; or

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(vi) Any failure by Seller in a Showing Month to deliver Delivered Quantities to Buyer equal to the Contract Amounts in accordance with Section 5.2; provided that a Seller’s Event of Default shall not be deemed to have occurred under this Section 7.1(a)(vi) if such failure has not been preceded by two (2) or more such failures in separate Showing Months within the last six (6) months and Seller provides Buyer with substitute Capacity Attributes that are acceptable to Buyer in Buyer’s reasonable discretion in the amount of such S hortfall and for the time period of such Shortfall.
(vii) For the avoidance of doubt : (1) a Seller’s Event of Default shall be deemed to have occurred under Section 7.1(a)(vi) if Seller fails to provide Buyer with substitute Capacity Attributes in accordance with Section 7.1(a)(vi) ; (2) the amount described in Section

7.1(a)(vi) shall be owed by Seller to Buyer on a separate and additional basis for each of any two (2) failures under Section 7.1(a)(vi) occurring within any six (6) month period; and (3) the amount described in Section 7.1(a)(vi) represents Buyer’s direct damages as a result of a failure by Seller to deliver Delivered Quantities to Buyer equal to the Contract Amounts in accordance with Section

5.2 and is in addition to Seller’s indemnity obligations under Article 15 for any third-party Claims, including any penalties or fines imposed by CAISO or the CPUC. (b) E ither Party will be deemed a Defaulting Party upon the occurrence of any of the following (each, a “Party’s Event of Default”):” (i) the failure by such Party to make, when due, any payment required pursuant to this Agreement and such failure is not remedied within ten (10) Business Days after Notice thereof;
(ii) any representation or warranty made by such Party under this Agreement is false or misleading in any material respect when made or when deemed made or repeated, and such default is not remedied within thirty (30) days after Notice thereof , or such longer additional period, not to exceed an additional sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30) day period despite exercising diligent efforts;
(iii) the failure by such Party to perform any material covenant or obligation set forth in this Agreement, including any failure by Seller to comply with Sections 5.1,

5.2, or 6.4 or with any Requirement or Safety Requirement in accordance with Section 6.3, in any case except to the extent constituting a separate Event of Default, and such failure is not remedied within thirty (30) da ys after Notice thereof , or such longer additional period, not to exceed an additional ninety (90) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30) day period despite exercising diligent efforts; (iv) such Party becomes Bankrupt;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Article 18; or
(vi) such Party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all of its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer, the resulting, surviving or transferee entity fails

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to assume all the obligations of such Party under this Agreement to which it or its predecessor was a party by operation of Law or pursuant to an agreement reasonably satisfactory to the other Party.

7.2 Remedies; Declaration of Early Termination Date. If an Event of Default with respect to a Defaulting Party has occurred, the other Party (“ Non-Defaulting Party”) shall have the following rights:
(a) t o send Notice, designating a day, no earlier than the day such Notice is deemed to be received and no later than twenty (20) days after such Notice is deemed to be received, as an early termination date of this Agreement (“Early Termination Date ”) that terminates this Agreement (the “Terminated Transaction”) and ends the Delivery Term effective as of the Early Termination Date;
(b) t o accelerate all amounts owing between the Parties, and to collect as liquidated damages (i) the Damage Payment, in the case of an Event of Default by Seller occurring before the Initial Delivery Date, including an Event of Default under Section 7.1(a)(v) , or (ii) the Termination Payment calculated in accordance with Section 7.3 below, in the case of any other Event of Default by either Party;
(c) to withhold any payments due to the Defaulting Party under this Agreement; (d) to suspend performance; or
(e) to exercise any other right or remedy available at law or in equity, including specific performance or injunctive relief, except where an express and exclusive remedy or measure of damages is provided under this Agreement;
provided, that payment by the Defaulting Party of the Damage Payment or Termination Payment, as applicable, shall constitute liquidated damages and the Non -Defaulting Party’s sole and exclusive remedy for any Terminated Transaction and the Event of Default related thereto.

7.3 T ermination Payment . The Termination Payment (“Termination Payment”) for a Terminated Transaction shall be the aggregate of the Settlement Amount plus any or all other amounts due to or from the Non-Defaulting Party, as of the Early Termination Date, netted into a single amount. The Non-Defaulting Party shall calculate a Settlement Amount for the Terminated Transaction as of the Early Termination Date. Third parties supplying information for purposes of the calculation of Gains or Losses may include, without limitation, dealers in the relevant markets, end-users of the relevant product, information vendors and other sources of market information.

The Settlement Amount shall not include consequential, incidental, punitive, exemplary, indirect or business interruption damages. Without prejudice to the Non- Defaulting Party’s duty to mitigate, the Non-Defaulting Party shall not have to enter into replacement transactions to establish a Settlement Amount. Each Party agrees and acknowledges that (a) the actual damages t hat the Non-Defaulting Party would incur in connection with a Terminated Transaction would be difficult or impossible to predict with certainty, (b) the Damage Payment or Termination Payment described in Section 7.2 or this Section 7.3, as applicable, is a reasonable and appropriate approximation of such damages, and (c) the Damage Payment or Termination Payment described in Section 7.2 or this Section 7.3, as applicable, is the exclusive remedy of the Non-Defaulting Party in connection with a Terminated Transaction but shall not otherwise act to limit any of the

31 Energy Storage Resource Adequacy Agreement Form
Non-Defaulting Party’s rights or remedies if the Non-Defaulting Party does not elect a Terminated Transaction as its remedy for an Event of Default by the Defaulting Party.

7.4 Notice of Payment of Termination Payment . As soon as practicable after a Terminated Transaction, Notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Damage Payment or Termination Payment and whether the Termination Payment is due to or from the Non-Defaulting Party. The Notice shall include a written statement explaining in reasonable detail the calculation of such amount and the sources for such calculation.

The Termination Payment shall be made to or from the Non-Defaulting Party, as applicable, within ten (10) Business Days after such Notice is effective.

7.5 D
isputes with Respect to Termina tion Payment. If the Defaulting Party disputes the Non- Defaulting Party’s calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within five (5) Busines s Days of receipt of the Non -Defaulting Party’s calculation of the Termination Payment, provide to the Non- Defaulting Party a detailed written explanation of the basis for such dispute. Disputes regarding the Termination Payment shall be determined in accordance with Article 19.

7.6 Rights and Remedies Are Cumulative. Except where an express and exclusive remedy or measure of damages is provided, the rights and remedies of a Party pursuant to this Article 7 shall be cumulative and in addition to the rights of the Parties otherwise provided in this Agreement.

ARTICLE 8: FORCE MAJEURE

8.1 Force Majeure.
(a) Effect of Force Majeure. A Party shall not be considered to be in default in the performance of its obligations to the extent that the failure or delay of its performance is due to a Force Majeure event, and the non -affected Party shall be excused from its corresponding performance obligations for the period of the affected Party’s failure or delay of performance. The burden of proof for establishing the existence and consequences of an event of Force Majeure lies with the Party initiating the claim.
(b) N
otice of Force Majeure. T he Party desiring to invoke the Force Majeure event as a cause for delay in its performance of, or failure to perform, any o bligation hereunder, shall provide prompt Notice to the other Party in the form of a letter identifying the event of Force Majeure and describing in detail the particulars of the occurrence giving rise to the Force Majeure event including the expected duration, when known, and the effect of such Force Majeure event.

Failure to provide timely Notice constitutes a waiver of a claim of Force Majeure. Promptly, but in any event within ten (10) days after a Notice is given pursuant to the preceding sentence, t he Parties shall meet to discuss the basis and terms upon which the arrangements set out in this Agreement shall be continued taking into account the effects of such event of Force Majeure. (c) Mi
tigation of Force Majeure. The suspension of a Party’ s performance under this Agreement due to a claim of Force Majeure shall be of no greater scope and of no longer duration than is required by the Force Majeure event. A Party suspending performance due to Force Majeure shall take, or cause to be taken, such action as may be necessary to void, or nullify,

32 Energy Storage Resource Adequacy Agreement Form
or otherwise to mitigate, in all material respects, the effects of such event of Force Majeure. The Parties shall take all reasonable steps to resume normal performance under this Agreement after the cessation of any Force Majeure event. If Seller cannot meet the Expected Initial Delivery Date as a result of a Force Majeure event declared by Seller in accordance with this Agreement , then Seller shall work diligently to resolve the effect of the Force Majeure and pro vide evidence of its efforts promptly upon Buyer’s written request.
(d) Force Majeure Failure. Notwithstanding any provision to the contrary, Buyer shall have the right, but not the obligation, to terminate this Agreement after the occurrence of the following, each constituting a “Force Majeure Failure”:
(i) if during the Delivery Term:
(A) due to a Force Majeure event, Seller is unable to meet its obligations under this Agreement (including any failure to deliver Delivered Quantities to Buyer equal to the Contract A mounts) on more than one hundred eighty (180) days within any three hundred sixty-five (365) day period; or
(B) the Project is destroyed or rendered inoperable by an event of Force Majeure; provided that Seller may repair or restore the Project if: (1) Seller provides to Buyer within the sixty (60) day period following the conclusion of the Force Majeure event a certificate from a non -affiliated, licensed professional engineer attesting that the Project can be restored to original operational status within the six (6) month period following the conclusion of the Force Majeure event; (2) Seller provides Buyer with Notice of Seller’s election to repair or restore the Project within the sixty (60) day period following the conclusion of the Force Majeure event; and (3) Seller completes such repair or restoration to original operational status within the six (6) month period following the
conclusion of the Force Majeure event;
(ii) if Seller is unable, due to a Force Majeure event, to achieve the Initial Delivery Date by one hundred eighty (180) days after the Expected Initial Delivery Date. (e) Effect of Termination for Force Majeure Failure. If Buyer exercises its termination right in connection with a Force Majeure Failure under Section 8.1(d) , then this Agreement shall terminate without further liability of either Party to the other, effective upon the date set forth in Buyer ’s Notice of termination, subject to each Party ’s satisfaction of all of the final payment and survival obligations set forth in Section 21.3.

ARTICLE 9: INVOICING AND PAYMENT

9.1 Invoicing. Seller shall make good faith efforts to deliver an invoice, in arrears, to Buyer no sooner than ten (10) Business Days after the end of each Showing Month of the Delivery Term for all amounts due from Buyer to Seller under this Agreement, including, as applicable: (a) the Monthly Payment, and (b) other compensatory adjustments required by this Agreement , including adjustments for Taxes . Each invoice shall (i) contain data sufficient to document and verify all amounts included therein, including any relevant records, invoices, or settlement data from CAISO, necessary to verify the accuracy of any amount and (ii) be in a format specified by Buyer.

33 Energy Storage Resource Adequacy Agreement Form

9.2 Payment. Buyer shall make payment to Seller by wire transfer or ACH payment to the bank account provided on each monthly i nvoice. Buyer shall pay undisputed invoice amounts by the twenty- third (23rd) day of the month following the month in which the invoice was provided by Seller. If such due date falls on a weekend or legal holiday, such due date shall be the next Business D ay. Any undisputed portion of the invoice amount paid after the due date will be considered late and will bear interest on the unpaid balance. If the amount due is not paid on or before the due date or if any other payment that is due and owing from one Party to another is not paid on or before its applicable due date, a late payment charge shall be applied to the unpaid balance and shall be added to the next billing statement. Such late payment charge shall be calculated based on an annual interest rate equal to the three-month LIBOR, plus two percent (2%) (the “Interest Rate”). If the due date occurs on a day that is not a Business Day, the late payment charge shall begin to accrue on the next succeeding Business Day.

9.3 P ayment Adjustments; Billing Errors . Payment adjustments shall be made if Buyer or Seller discovers there have been good faith inaccuracies in invoicing that are not otherwise disputed under Section 9.4 or an adjustment to an amount previously invoiced or paid is required due to a correction of data by CAISO. If the required adjustment is in favor of Buyer, Buyer’s next monthly payment shall be credited in an amount equal to the adjustment. If the required adjustment is in favor of Seller, Seller shall add the adjustment amount to Buyer’s next monthly invoice. Adjustments in favor of either Buyer or Seller shall bear interest at the Interest Rate, until settled in full, in accordance with Section 9.2, accruing from the date on which the adjusted amount should have been due.

9.4 B illing Disputes . A Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice rendered under this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date of the invoice, or adjustment to an invoice, was rendered. In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due. Any invoice dispute or invoice adjustment shall be in writing and shall state the basis for the dispute or adjustment. Payment of the disputed amount shall not be required until the dispute is resolved. Upon resolution of the dispute, any required payment shall be made within five (5) Business Days of such resolution along with interest accrued at the Interest Rate from and including the original due date to but excluding the date paid. Inadvertent overpayments shall be returned via adjustments in accordance with Section

9.3. Any dispute with respect to an invoice is waived if the other Party is not notified in accordance with this Section 9.4 within twelve (12) months after the invoice is rendered or subsequently adjusted, except to the extent any misinformation was from a third party not affiliated with any Party and such third party corrects its information after the twelve (12) month period. If an invoice is not rendered within twelve (12) months after the close of the month during which performance occurred, the right to payment for such performance is waived.

9.5 N
etting of Payments . The Parties hereby agree that they shall discharge mutual undisputed debts and payment obligations due and owing to each other on the same date through netting, in which case all amounts owed by each Party to the other Party for the purchase and sale of Product during the monthly billing period under this Agreement or otherwise arising out of this Agreement, including any related damages, interest, and payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it.

34 Energy Storage Resource Adequacy Agreement Form
ARTICLE 10: PERFORMANCE ASSURANCE

10.1 Seller’s Development Security. To secure its obligations under this Agreement, Seller shall deliver the Development Security to Buyer within thirty (30) days of the Effective Date. Seller shall maintain the Development Security in full force and effect and Seller shall within five (5) Business Days after any draw thereon replenish the Development Security in the event Buyer collects or draws down any portion of the Development Security for any reason permitted under this Agreement other than to satisfy a Termination Payment. Upon the earlier of (a) Seller’s delivery of the Delivery Term Security, or (b) sixty (60) days after termination of this Agreement, Buyer shall return the Development Security to Seller, less the amounts drawn in accordance with this Agreement. If the Development Security is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating specified in the definition of Letter of Credit, (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the Expected Initial Delivery Date, or (iii) fails to honor Buyer’s properly documented request to draw on such Letter of Credit by such issuer, Seller shall have ten (10) Business Days to either post cash or deliver a substitute Letter of Credit that meets the requirements set forth in the definition of Development Security.

10.2 S
eller’s Delivery Term Security . To secure its obligations under this Agreement, Seller shall deliver Delivery Term Security to Buyer on or before the Initial Delivery Date. Seller shall maintain the Delivery Term Security in full force and effect, and shall within five (5) Business Days after any draws made by Buyer in accordance with this Agreement (other than to satisfy a Termination Payment) replenish the Delivery Term Security (except in the case of a Guaranty, as to which there is no obligation of Seller to replenish), until the following have occurred: ( a) the Delivery Term has expired or terminated early; and (b) all payment obligations of Seller then due and payable under this Agreement, including compensation for penalties, Termination Payment, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set-off or netting). Following the occurrence of both events, Buyer shall promptly return to Seller the unused portion of the Delivery Term Security. If the Delivery Term Security is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating set forth in the definition of Letter of Credit, (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the end of the Delivery Term , or (iii) fails to honor Buyer’s properly documented request to draw on such Letter of Credit by such issuer, Seller shall have ten (10) Business Days to deliver substitute Delivery Term Security that meets the requirements set forth in the definition of Delivery Term Security.

If the Delivery Term Security
is a Guaranty and the Guarantor (i) fails to maintain the minimum Credit Rating set forth in the definition of “Guarantor,” (ii) becomes Bankrupt, or (iii) fails to honor Buyer’s properly demanded payment in accordance with the terms of the Guaranty, Seller shall have ten (10) Business Days to deliver substitute Delivery Term Security that meets the requirements set forth in the definition of Delivery Term Security.

10.3 F
irst Priority Security Interest in Cash or Cash Equivalent Collateral . (a) To secure its obligations under this Agreement , and until released as provided herein, Seller hereby grants to Buyer a present and continuing first -priority security interest (“Security Interest”) in, and lien on (and right to net against), and assignment of the Development Security, Delivery Term Security, any other cash collateral and cash equivalent

35 Energy Storage Resource Adequacy Agreement Form
collateral posted pursuant to Sections 10.1 and 10.2 and any and all interest thereon or proceeds resulting therefrom or from the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of Buyer, and Seller agrees to take all action as Buyer reasonably requires in order to perfect Buyer’s Security Interest in, and lien on (and right to net against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof. Upon or any time after the occurrence of a Seller’s Event of Default or a Party’s Event of Default on the part of Seller, an Early Termination Date resulting from a Seller’s Event of Default or a Party’s Event of Default on the part of Seller, or an occasion provided for in this Agreement where Buyer is authorized to retain all or a portion of the Development Security or Delivery Term Security, Buyer may do any one or more of the following (in each case subject to the final sentence of this Section

10.3):
(i) Exercise any of its rights and remedies with respect to the Development Security and Delivery Term Security, including any such rights and remedies under Law then in effect;
(ii) Draw on any outstanding Letter of Credit issued for its benefit and retain any cash held by Buyer as Development Security or Delivery Term Security; and (iii) Liquidate all Development Security or Delivery Term Security (as applicable) then held by or for the benefit of Buyer free from any claim or right of any nature whatsoever of Seller, including any equity or right of purchase or redemption by Seller. (b) Buyer shall apply the proceeds of the collateral realized upon the exercise of any such rights or remedies to reduce Seller’s obligations under this Agreement (Seller remains liable for any amounts owing to Buyer after such application), subject to Buyer’s obligation to return any surplus proceeds remaining after these obligations are satisfied in full.

10.4 Seller Financial Information. If requested by Buyer, Seller shall deliver to Buyer (a) within one hundred twenty (120) days following the end of each fiscal year, a copy of Seller’s annual report containing unaudited consolidated financial statements for such fiscal year, if available, (or audited consolidated financial statements for such fiscal year, if otherwise available) and (b) within sixty (60) days after the end of each of its first three fiscal quarters of each fiscal year, a copy of such Seller’s quarterly report containing unaudited consolidated financial statements for such fiscal quarter, if available. In all cases the statements shall be for the most recent accounting period and shall be prepared in accordance with Generally Accepted Accounting Principles. This information shall be deemed to be Confidential Information for purposes of this Agreement.

10.5 B
uyer Credit Support .
(a) To secure Buyer’s obligations under this Agreement, Seller shall have the right to execute a Joi nder, which shall allow Seller to become a “PPA Provider” and “Secured Creditor” for all purposes under the Lockbox Arrangement Documents for so long as Member is subject to the Security Agreement and the Lockbox Account Control Agreement (or any successor arrangement generally available to Member’s creditors and permitted under Section 10.5(b)(iii) ) (the current arrangement under the Lockbox Arrangement Documents and any successor

36 Energy Storage Resource Adequacy Agreement Form
arrangement thereto generally available to Buyer’s creditors is the “Member Lockbox Arrangement”); provided, however, that if Member provides Member Performance Security, then so long as Buyer (or Member, as applicable) is not in default under this Agreement or any of the Lockbox Arrangement Documents, Buyer may, at the dir ection of its Member’s City Council, request the dissolution of the Member Lockbox Arrangement and Seller hereby agrees that (x) its security interest under the Member Lockbox Arrangement shall terminate, without further action, effective upon the terminat ion of the security interests of all other PPA Providers under the Member Lockbox Arrangement and (y) if requested by Buyer or Member, Seller would promptly execute a written termination statement confirming such termination in accordance with the Lockbox Arrangement Documents.
(b) Under the Member Lockbox Arrangement:
(i) Buyer shall cause Member to provide notice to Seller of the termination of all security interests under the Security Agreement or the termination of any other Lockbox Arrangement Document.
(ii) Buyer further agrees it will cause Member to not grant any additional security interests or permit any party to have payment or enforcement rights (i) under the Security Agreement on terms more favorable than those currently offered to Seller, or (ii) under any arrangement similar to the Security Agreement that is generally available to Member’s creditors unless Seller is offered the right to participate in such arrangement on terms no less favorable than those offered to the other participants. (iii) In addition, so long as Buyer (or Member, as applicable) is not in default under this Agreement and Member is not in default under any of the Lockbox Arrangement Documents, Buyer may request the dissolution of the current Member Lockbox Arrangement in order to permit Member to enter into a substantially similar successor Member Lockbox Arrangement and, provided that Seller is allowed to become a PPA Provider (or its equivalent) and Secured Creditor (or its equivalent) under the successor Member Lockbox Arrangement, Seller hereby agrees that (x) its security interest under the Security Agreement shall terminate, without further action, effective upon the termination of the security interests of all other PPA Providers under the Security Agreement and the grant and perfect ion of a security interest under the successor Member Lockbox Arrangement, and (y) if requested by Buyer, Seller would promptly execute a written termination statement confirming such termination in accordance with Section

7.12 of the Security Agreement.
(c) If Buyer causes Member to provide Member Performance Security, then Buyer shall maintain, or cause Member to maintain, the Member Performance Security in full force and effect until the following have occurred: (i) the Delivery Term has expired or terminated early; and (ii) all payment obligations of Buyer arising under this Agreement, including compensation for penalties, Termination Payment, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set -off or netting). Following the occurrence of both events, Seller shall promptly return to Buyer the unused portion of the Member Performance Security. If the Member Performance Security is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating set forth in the definition of Letter of Credit, (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit

37 Energy Storage Resource Adequacy Agreement Form
expires prior to the time that Seller is required to return the Member Performance Security, or (iii) fails to honor Seller’s properly documented request to draw on such Letter of Credit by such issuer, Buyer shall have five (5) Business Days to either post, or cause Member to post, cash or deliver, or cause Member to deliver, a substit ute Letter of Credit that meets the requirements set forth in this Agreement.

ARTICLE 11: SAFETY

11.1 Safety.
(a) Seller shall , and shall cause any Affiliates performing any design, construction, operation or maintenance of the Project and Contractors to, design, construct, operate, and maintain the Project and conduct all Work or cause all Work to be conducted in accordance with the Safety Requirements. Seller shall, and shall cause its Affiliates and Contractors to, take all actions to comply with the Safety Requirements. (b) Prior to Seller’s execution of a Contractor’s contract solely with respect to the operation and maintenance of the Project after the Initial Delivery Date (i) with a value of $500,000 or more (calculated on an aggregated basis with any other contract with such Contractor) or (ii) relating to any element of the Work that involves significant safety considerations , Seller shall demonstrate to Buyer ’s reasonable satisfaction that the Contractor has the qualifications, experience, and safety record to operate and maintain the Project, as applicable; provided that Seller has pre- approved the Contractors set forth in Appendix IX. During the period that a Contractor is conducting Work, Seller shall cause the Contractor to meet and comply with the Safety Requirements.
(c) S eller shall document a Project Safety Plan and incorporate the Project Safety Plan’s features into the design, development, construction, operation, and maintenance of the Project. Seller shall submit for Buyer’s review a Project Safety Plan, in a format reasonably acceptable to Buyer, which must demonstrate (A) Seller’s plans to comply with the Safety Requirements and (B) Seller’s consideration of the Project Safety Plan items in Part Two (Project Design and Description) of Appendix VI . Upon Notice to Buyer, Seller may deviate from any specific procedures identified in the Project Safety Plan while designing, developing, constructing, operating, or maintaining the Project, if in Seller’s judgment, the deviation is necessary to design, develop, construct, operate, or maintain the Project safely or in accordance with the Safety Requirements.
(d) Throughout the Delivery Term, Seller shall update the Safeguards and the Project Safety Plan as required by Safety Requirements or as necessitated by a Safety Remediation Plan. Seller shall provide such updated Project Safety Plan to Buyer within thirty (30) days of any such updates. Throughout the Delivery Term, Buyer shall have the right to r equest Seller to provide its Project Safety Plan, or portions thereof, and demonstrate its compliance with the Safety Requirements within thirty (30) days of Buyer’s Notice. (e) Seller shall remove any Contractor that engages in repeated, material violations of the Project Safety Plan or Safety Requirements, unless doing so would present an ongoing material adverse effect to the operation of the Project.

38 Energy Storage Resource Adequacy Agreement Form

11.2 Reporting Serious Incidents. Seller shall provide Notice of a Serious Incident to Buyer within five (5) Business Days of occurrence. The Notice of Serious Incident must include the time, date, and location of the incident, the Contractor involved in the incident (as applicable), the circumstances surrounding the incident, the immediate response and recovery actions taken, and a description of any impacts of the Serious Incident. Seller shall cooperate and provide reasonable assistance, and cause each of its Contract ors to cooperate and provide reasonable assistance, to Buyer with any investigations and inquiries by Governmental Authorities that arise as a result of the Serious Incident.

11.3 R
emediation .
(a) Seller shall resolve any Remediation Event within the Remediation Period.

Within ten (10) days of the date of the first occurrence of any Remediation Event, Seller shall provide a Safety Remediation Plan to Buyer for Buyer’s review. (b) Seller shall cooperate, and cause each of its Contractors to cooperate, with Buyer in order for Seller to provide any report relating to a Remediation Event, in a form and level of detail that is acceptable to Buyer which incorporates information, analysis, investigations or documentation, as applicable or as requested by Buyer.

ARTICLE 12: TAXES

12.1 Taxes. Seller shall pay or cause to be paid all Taxes (a) on or with respect to the Project and (b) on or with respect to the sale and making available of Product to Buyer that are imposed on Product prior to its delivery to Buyer at the time and place contemp lated under this Agreement. Buyer shall pay or cause to be paid all Taxes on or with respect to the delivery to and purchase by Buyer of Product that are imposed on Product at and after its delivery to Buyer at the time and place contemplated under this Agreement (other than withholding or other Taxes imposed on Seller’s income, revenue, receipts or employees), if any. If a Party is required to remit or pay Taxes that are the other Party’s responsibility hereunder, such Party shall promptly pay the Taxes due and then seek and receive reimbursement from the other for such Taxes. In the event any sale of Product hereunder is exempt from or not subject to any particular Tax, Buyer shall provide Seller with all necessary documentation within thirty (30) days after the Effective Date to evidence such exemption or exclusion. If Buyer does not provide such documentation, then Buyer shall indemnify, defend, and hold Seller harmless from any liability with respect to Taxes from which Buyer claims it is exempt.

12.2 C
ooperation . Each Party shall use reasonable efforts to implement the provisions of and administer this Agreement in accordance with the intent of the Parties to minimize all Taxes, so long as no Party is materially adversely affected by such efforts. The Parties shall cooperate to minimize Tax exposure; provided, however, that neither Party shall be obligated to incur any financial or operational burden to reduce Taxes for which the other Party is responsible hereunder without receiving due compensation therefor from the other Party.

ARTICLE 13: LIMITATIONS

13.1 No Consequential Damages . EXCEPT TO THE EXTENT PART OF AN

EXPRESS REMEDY OR MEASURE OF DAMAGES HEREIN, OR PART OF AN ARTICLE

39 Energy Storage Resource Adequacy Agreement Form
15 INDEMNITY CLAIM, OR INCLUDED IN A LIQUIDATED DAMAGES CALCULATION,

OR ARISING FROM FRAUD OR INTENTIONAL MISREPRESENTATION, NEITHER

PARTY SHALL BE LIABLE TO THE OTHER OR ITS INDEMNIFIED PERSONS FOR ANY

SPECIAL, PUNITIVE, EXEMPLARY, INDIRECT, OR CONSEQUENTIAL DAMAGES, OR

LOSSES OR DAMAGES FOR LOST REVENUE OR LOST PROFITS, WHETHER

FORESEEABLE OR NOT, ARISING OUT OF, OR IN CONNECTION WITH THIS AGREEMENT.

13.2 Wai
ver and Exclusion of Other Damages .
(a) EXCEPT AS EXPRESSLY SET FORTH HEREIN, THERE IS NO

WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. THE PARTIES

CONFIRM THAT THE EXPRESS REMEDIES AND MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. ALL

LIMITATIONS OF LIABILITY CONTAINED IN THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THOSE PERTAINING TO SEL LER’S LIMITATION OF LIABILITY AND THE PARTIES’ WAIVER OF CONSEQUENTIAL DAMAGES, SHALL

APPLY EVEN IF THE REMEDIES FOR BREACH OF WARRANTY PROVIDED IN THIS AGREEMENT ARE DEEMED TO “FAIL OF THEIR ESSENTIAL PURPOSE” OR ARE OTHERWISE HELD TO BE INVALID OR UNENFORCEABLE.
(b) FOR BREACH OF ANY PROVISION FOR WHICH AN EXPRESS AND

EXCLUSIVE REMEDY OR MEASURE OF DAMAGES IS PROVIDED, SUCH EXPRESS

REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, THE OBLIGOR’S LIABILITY SHALL BE LIMITED AS SET FORTH IN SUC H

PROVISION, AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED.
(c) TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID
HEREUNDER ARE LIQUIDATED, INCLUDING UNDER SECTIONS 4.1(c), 7.1(a)(iv), 7.2 AND 7.3, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE DIFFICULT OR

IMPOSSIBLE TO DETERMINE, THAT OTHERWISE OBTAINING AN ADEQUATE

REMEDY IS INCONVENIENT, AND THAT THE LIQUIDATED DAMAGES CONSTITUTE A REASONABLE APPROXIMATION OF THE ANTICIPATED HARM OR LOSS. IT IS THE

INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES

AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR

CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY,

WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. THE PARTIES HEREBY WAIVE ANY RIGHT TO CONTEST SUCH PAYMENTS AS AN UNREASONABLE PENALTY.
(d) THE PARTIES ACKNOWLEDGE AND AGREE THAT MONEY

DAMAGES AND THE EXPRESS REMEDIES PROVIDED FOR HEREIN ARE AN

ADEQUATE REMEDY FOR THE BREACH BY THE OTHER OF THE TERMS OF THIS

AGREEMENT, AND EACH PARTY WAIVES ANY RIGHT IT MAY HAVE TO SPECIFIC

40 Energy Storage Resource Adequacy Agreement Form

PERFORMANCE WITH RESPECT TO ANY OBLIGATION OF THE OTHER PARTY UNDER THIS AGREEMENT.

ARTICLE 14: REPRESENTATIONS; WARRANTIES; COVENANTS

14.1 Seller’s Representations and Warranties . As of the Effective Date, Seller represents and warrants as follows:
(a) Seller is a limited liability company, duly organized, validly existing and in good standing under the laws of the State of California, and is qualified to conduct business in the State of California and each jurisdiction where the failure to so qualify would have a material adverse effect on the business or financial condition of Seller. (b) Seller has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement . The execution, delivery and performance of this Agreement by Seller has been duly authorized by all necessary action on the part of Seller (evidence of such due authorization Seller shall provide to Buyer if requested) and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Seller or any other party to any other agreement with Seller. (c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Seller with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Seller, subject to any permits that have not yet been obtained by Seller, the documents of formation of Seller or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Seller is a party or by which any of its property is bound. (d) This Agreement has been duly executed and delivered by Seller. This Agreement is a legal, valid and binding obligation of Seller enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of cred itors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) The Project is located in the State of California.
(f) Seller will be responsible for obtaining all permits necessary to construct and operate the Project and Seller will be the applicant on any CEQA documents. (g) Seller is familiar with conflict of interest Laws, including the California Political Reform Act, an d Buyer’s board policies governing conflicts of interest; Seller is in compliance with such Laws and board policies and does not know of any facts that would violate such Laws and board policies; Seller and its officers and agents have not, directly or indirectly, offered, paid, promised, or authorized the giving of money or anything of value to any employee, director, officer of Buyer or governmental official in Riverside County, California or Los Angeles County, California for the purpose of influencing any act or decision of such employee, director, officer or government official in her official capacity; no officer or agent of Seller (i) is a government official in Riverside County, California or Los Angeles County, California or a family

41 Energy Storage Resource Adequacy Agreement Form
member of a gov ernment official in Riverside County, California or Los Angeles County, California or (ii) has a personal, business, or other relationship or association with any government official in Riverside County, California or Los Angeles County, California , or family member thereof, who may have responsibility for or oversight of any activities of Buyer; Seller does not employ any government official in Riverside County, California or Los Angeles County, California, or family member thereof.

14.2 Buyer’s Representations and Warranties . As of the Effective Date, Buyer represents and warrants as follows:
(a) Buyer is a joint powers authority and a validly existing community choice aggregator, duly organized, validly existing and in good standing under the laws of the State of California and the rules, regulations and orders of the CPUC, and is qualified to conduct business in each jurisdiction of the Joint Powers Agreement members. All Persons making up the governing body of Buyer are the elected or appointed incumbents in their positions and hold their positions in good standing in accordance with the Joint Powers Agreement and other Law. (b) Buyer has the power and authority to enter into and perform this Agreement and is not prohibited from entering into this Agreement or discharging and performing all covenants and obligations on its part to be performed under and pursuant to this Agreement, except where such failure does not have a material adverse effect on Buyer’s performance under this Agreement. The execution, delivery and performance of this Agreement by Buyer has been duly authorized by all necessary action on the part of Buyer and does not and will not require the consent of any trustee or holder of any indebtedness or other obligation of Buyer or any other party to any other agreement with Buyer.
(c) The execution and delivery of this Agreement, consummation of the transactions contemplated herein, and fulfillment of and compliance by Buyer with the provisions of this Agreement will not conflict with or constitute a breach of or a default under any Law presently in effect having applicability to Buyer, the documents of formation of Buyer or any outstanding trust indenture, deed of trust, mortgage, loan agreement or other evidence of indebtedness or any other agreement or instrument to which Buyer is a party or by which any of its property is bound.
(d) This Agreement has been duly executed and delivered by Buyer. This Agreement is a legal, valid and binding obligation of Buyer enforceable in accordance with its terms, except as limited by laws of general applicability limiting the enforcement of creditors’ rights or by the exercise of judicial discretion in accordance with general principles of equity. (e) Buyer warrants and covenants that with respect to its contractual obligations under this Agreement, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (i) suit, (ii) jurisdiction of court (provided that such court is located within a venue permitted in law and under this Agreement), (iii) relief by way of injunction, order for specific performance or recovery of property, (iv) attachment of assets, or (v) execution or enforcement of any judgment; provided, however that nothing in this Agreement shall waive the obligations or rights set forth in the California Tort Claims Act (Government Code Section 810 et seq.).

42 Energy Storage Resource Adequacy Agreement Form
(f) Buyer is a “local public entity” as defined in Section 900.4 of the Government Code of the State of California.

14.3 General Covenants. Each Party covenants that commencing on the Effective Date and continuing throughout the Term it shall continue to be duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation and to be qualified to conduct business in the State of California and each jurisdiction where the failure to so qualify would have a material adverse effect on its business or financial condition.

14.4 C
ovenants of Seller . Seller covenants to and for the benefit of Buyer that throughout the Delivery Term (unless another time period is specified):
(a) Seller will (i) acquire and maintain all Governmental Approvals necessary for the construction, operation, and maintenance of the Project consistent with Safety Requirements, including any approvals required from the City of Santa Paula under the CEQA, (ii) Notify Buyer of any material modifica tions or lapse in renewal of Governmental Approvals, and (iii) at Buyer’s request, provide to Buyer digital copies of any Governmental Approvals. (b) Seller will use reasonable efforts to ensure that all employees hired by Seller, and its Contractors, that will perform construction work or provide services at the Site related to construction of the Project are paid wages at rates not less than those prevailing for workers performing similar work in the locality as provided by applicable California Law, if any. Nothing herein shall require Seller or its Contractors to comply with, or assume liability created by other inapplicable provisions of any California labor Laws. Buyer agrees that Seller’s obligations under this Section 14.4(b) will be satisfied upon the execution of a project labor agreement related to construction of the Project.
(c) S eller shall perform the obligations related to workforce development and community investment set forth in Appendix XII.
(d) Seller will deliver the Product to Buyer free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any Person. (e) Seller will take no action or permit any Person (other than Buyer) to take any action that would impair in any way Buyer ’s ability to rely on the Project in order to satisfy its Compliance Obligations.
(f) Seller shall not transfer or assign the right to claim the Contract Amounts as an incremental resource for purposes of CPUC D.21-06-035 to any Person other than Buyer. (g) Seller shall operate the Project during the Delivery Term in accordance with Appendices I and II and Safety Requirements.
(h) Seller shall comply with all Utility Distribution Company, Participating Transmission Owner, and CAISO Tariff requirements applicable to energy storage facilities. (i) Seller shall follow all the rules set forth in Appendix A of the MUA Decision.

43 Energy Storage Resource Adequacy Agreement Form
ARTICLE 15: INDEMNITIES

15.1 Indemnity by Seller.
(a) Seller shall defend, indemnify and hold harmless Buyer, its directors, officers, agents, attorneys, employees, and representatives (“Buyer Group”) from and against all third party claims, demands, losses, liabilities, penalties, and expenses, including rea sonable attorneys’ and expert witness fees, however described (collectively, “Claims”), which arise out of or relate to or are in any way connected with ( i) Seller’s delivery of the Product to Buyer, ( ii) Seller’s ownership, development, construction, operation or maintenance of the Project, including the Site(s); (iii) Seller’s actions or inactions, including Seller’s breach of this Agreement or other agreements related to the development, construction, ownership, operation or maintenance of the Project or Site (including any Claims relating to a Shortfall); ( iv) any environmental matters associated with the Project, including the disposal and transportation of Hazardous Substances by or on behalf of the Seller or at the Seller ’s direction or agreement; ( v) any agreement between Seller or its Affiliates and a third party; or ( vi) Seller ’s violation of any applicable Law, Requirements, or other requirements of Transmission Provider, Utility Distribution Company, NERC, WECC or Reliability Organization; in each case including any loss, claim, action or suit, for or on account of injury to, bodily or otherwise, or death of, persons, or for damage to or destruction or economic loss of property belonging to Buyer, Seller, excepting only such l osses, to the extent solely caused by the willful misconduct or gross negligence of a member of the Buyer Group (collectively, “Indemnifiable Losses”).
(b) Seller shall defend, indemnify and hold harmless the Buyer Group harmless from and against all Claims incurred by or brought against Buyer in connection with Environmental Costs.

15.2 Notice of Claim.
(a) Notice of Claim . Subject to the terms of this Agreement and upon obtaining knowledge of an Indemnifiable Loss for which it is entitled to indemnity under this Article 15, Buyer will promptly Notify Seller in writing of any Claim which Buyer has determined has given or could give rise to an Indemnifiable Loss under Section 15.1. The Notice is referred to as a “Notice of Claim.” A Notice of Claim will specify, in reasonable detail, the facts known to Buyer regarding the Indemnifiable Loss.
(b) F ailure to Provide Notice. A failure to give timely Notice or to inclu de any specified information in any Notice as provided in this Section 1 5.2 will not affect the rights or obligations of any Party hereunder except and only to the extent that, as a result of such failure, any Party which was entitled to receive such Notice was deprived of its right to recover any payment under its applicable insurance coverage or was otherwise materially damaged as a direct result of such failure and, provided further, Seller is not obligated to indemnify Buyer for the increased amount of any Indemnifiable Loss which would otherwise have been payable to the extent that the increase resulted from the failure to deliver timely a Notice of Claim.

15.3 D
efense of Claims . If, within ten (10) days after giving a Notice of Claim regarding a Claim to Seller pursuant to Section 1 5.2(b), Buyer receives Notice from Seller that

44 Energy Storage Resource Adequacy Agreement Form
Seller has elected to assume the defense of such Claim as provided in the last sentence of Section

15.2(b), Seller will not be liable for any legal expenses subsequently incurred by Buyer in connection with the defense thereof; provided, however, that if Seller fails to take reasonable steps necessary to defend diligently such Claim within ten (10) days after receiving Notice from Buyer that Buyer believes Seller has failed to take such steps, or if Seller has not undertaken fully to indemnify Buyer in respect of all Indemnifiable Losses relating to the matter, Buyer may assume its own defense, and Seller will be liable for all costs or expenses, including attorneys ’ fees, paid or incurred in connection therewith. Without the prior written consent of Buyer, Seller will not enter into any settlement of any Claim which would lead to liability or create any financial or other obligation on the part of Buyer for which Buyer is not entitled to indemnification hereunder ; provided, however, that Seller may accept any settlement without the consent of Buyer if such settlement provides a full release to Buyer and no requirement that Buyer acknowledge fault or culpability. If a firm offer is made to settle a Claim without leading to liability or the creation of a financial or other obligation on the part of Buyer for which Buyer is not entitled to indemnification hereunder and Seller desires to accept and agrees to such offer, Seller will give Notice to Buyer to that effect. If Buyer fails to consent to such firm offer within ten (10) days after its receipt of such Notice, Buyer may continue to contest or defend such Claim and, in such event, the maximum liability of Seller to such Claim will be the amount of such settlement offer, plus reasonable costs and expenses paid or incurred by Buyer up to the date of such Notice.

15.4 S ubrogation of Rights . Upon making any indemnity payment, Seller will, to the extent of such indemnity payment, be subrogated to all rights of the Buyer against any third party in respect of the Indemnifiable Loss to which the indemnity payment relates; provided that (a) Seller is in compliance with its obligations under this Agreement in respect of such Indemnifiable Loss, and (b) until Buyer recovers full payment of its Indemnifiable Loss, any and all claims of the Seller against any such third party on account of said indemnity payment are hereby made expressly subordinated and subjected in right of payment to Buyer’s rights against such third party.

Without limiting the generality or effect of any other provision hereof, Buyer and Seller shall execute upon request all instruments reasonably necessary to evidence and perfect the above - described subrogation and subordination rights.

15.5 R
ights and Remedies are Cumulative. T he rights and remedies of a Party pursuant to this Article 15 are cumulative and in addition to the rights of the Parties otherwise provided in this Agreement, except with respect to any expressly exclusive remedies herein.

ARTICLE 16: INSURANCE

16.1 Insurance. Throughout the Term, Seller shall procure and maintain the following insurance coverage and require and cause its Contractors to maintain the same levels of coverage.

For the avoidance of doubt, the obligations of Seller in this Section 16.1 constitute a material obligation of this Agreement.
(a) W orkers ’ Compensation and Employers’ Liability.
(i) If it has employees, w orkers’ c ompensation insurance indicating compliance with any applicable labor codes, acts, Laws or statutes, California state or federal, where Seller performs Work.

45 Energy Storage Resource Adequacy Agreement Form
(ii) Employers’ l iability insurance will not be less than one million dollars ($1,000,000.00) for injury or death occurring as a result of each accident. With regard to bodily injury by disease, the one million dollar ($1,000,000) policy limit will apply to each employee.
(b) Commercial General Liability.
(i) Commercial general liability insurance, including products and completed operations and personal injury insurance, in a minimum amount of two million dollars ($2,000,000) per occurrence, and an annual aggregate of not less than five million dollars ($5,000,000), endorsed to provide contractual liability in said amount, specifically covering Seller’s obligations under this Agreement and including Buyer as an additional named insured. (ii) An umbrella insurance policy in a minimum limit of liability of ten million dollars ($10,000,000).
(iii) Defense costs shall be provided as an additional benefit and not included within the limits of liability. Such insurance shall contain standard cross -liability and severability of interest provisions.
(c) Business Auto.
(i) Business auto insurance for bodily injury and property damage with limits of one million dollars ($1,000,000) per occurrence. (ii) Such insurance shall cover liability arising out of Seller’s use of all owned (if any), non- owned and hired vehicles, including trailers or semi -trailers in the performance of this Agreement.
(d) Construction All-Risk Insurance. During the construction of the Project prior to the Commercial Operation Date, construction all- risk form property insurance covering the Project during such construction periods, and naming Seller (and Lender if any) as the loss payee.
(e) C ontractor’ s Pollution Liability.
(i) If the scope of Work involves areas of known pollutants or contaminants, pollution liability coverage will be required to cover bodily injury, property damage, including clean- up costs and defense costs resulting from sudden, and accidental conditions , including the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, hydrocarbons, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any water course or body of water shall be maintained.
(ii) The limit will be at least two million dollars ($2,000,000.00) each occurrence for bodily injury and property damage.
(iii) The policy will endorse Buyer as additional insured.

46 Energy Storage Resource Adequacy Agreement Form

16.2 Evidence of Insurance. Within ten (10) days after the Effective Date and upon annual renewal thereafter, Seller shall deliver to Buyer certificates of insurance evidencing the coverage required under this Agreement. These certificates shall specify that Buyer shall be given at least thirty (30) days prior Notice by Seller in the event of any material modification, reduction, cancellation or termination of coverage. Such insurance shall be primary coverage without right of contribution from any insurance of Buyer.

16.3 F
ailure to Comply. If Seller fails to comply with any of the provisions of this Article 16, Buyer may, but is not obligated, to purchase the insurance coverage required under Section 16.1 and set off the cost thereof from any amounts owed by Buyer to Seller under this Agreement.

ARTICLE 17: RECORDS AND AUDIT RIGHTS

17.1 Operations Logs. Seller shall maintain a complete and accurate log of all material operations on a daily basis. Such log will include, but not be limited to, information on charging, discharging, availability, maintenance performed, outages, electrical characteristics of the energy storage systems and similar information relating to the availability, testing and operation of the Project. Seller shall provide this information electronically to Buyer on a monthly basis. At the request of Buyer, the CPUC, or the staff of the CPUC, Seller shall provide all records demonstrating that the Project is operated and maintained in accordance with Requirements.

17.2 R
ecords and Audit .
(a) Seller shall provide access to such financial records and personnel required by Buyer in order to facilitate Buyer’s compliance with applicable Law and Generally Accepted Accounting Principles.
(b) To facilitate payment and verification, each Party shall maintain all books and records necessary for billing and payments, including copies of all invoices under this Agreement, for a period of at least five (5) years or as otherwise required by Law. Seller will make all records available to Buyer at its principal place of business during normal working hours.

17.3 General Audit Right. Buyer has the right during normal working hours, and after reasonable Notice, to examine Seller’s records to the extent reasonably necessary to verify (a) Seller’s compliance with this Agreement (including Section 14.4), (b) the accuracy of any statement including the Project Safety Plan or other documents that supplement this Agreement, and (c) any charge, or computation made pursuant to this Agreement. If such examination reveals any material inaccuracy, necessary adjustments shall be made promptly.

17.4 S
tate Auditor . In accordance with Government Code Section 8546.7, Seller may be subject to audit by the California State Auditor with regard to Seller's performance of this Agreement if the compensation under this Agreement exceeds ten thousand dollars ($10,000.00).

17.5 D ata Request Cooperation . Each Party shall use reas onable efforts to assist the other Party in gathering information for and preparing responses to data requests and other inquiries from Governmental Authorities or Public Records Act requests that are related to or

47 Energy Storage Resource Adequacy Agreement Form
associated with the Project, delivery of Product or this Agreement, subject to the requirements of Article 20.

17.6 Access Rights. Buyer, its authorized agents, employees and inspectors, have, while observing and abiding by safety and security procedures of the Parties, the right of ingress to and egress from the Project, including the Site(s) with reasonable advance Notice and for any purposes connected with this Agreement. To the extent reasonably possible, Buyer will limit its requests to access the Project or the Site to normal business hours and coordinate its emergency activities with the safety and security departments, if any, of the Project operator. Seller shall keep Buyer advised of current procedures for contacting the Project operator’s safety and security departments.

ARTICLE 18: ASSIGNMENT

18.1 General Prohibition on Assignmen ts. Except as provided below, neither Party may assign this Agreement or its rights or obligations under this Agreement, without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed . Any Change of Control of Seller or direct or indirect change of control of Buyer (whether voluntary or by operation of law) will be deemed an assignment and will require the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned or delayed.

18.2 C
ollateral Assignment .
(a) Subject to the provisions of this Section 1 8.2, Seller has the right to assign this Agreement as collateral for any financing or refinancing of the Project. (b) I n connection with any collateral assignment of this Agreement for purposes of the financing or refinancing of the Project by Seller, Buyer agrees to work in good faith with Seller and Lender to agree upon a consent to collateral assignment of this Agreement (“Collateral Assignment Agreement”). The Collateral Assignment Agreement must be in form and substance agreed to by Buyer, Seller and Lender.

18.3 P ermitted Assignment by Seller. Except as may be precluded by, or would cause Buyer to be in violation of the Political Reform Act (Cal. Gov. Code section 81000 et seq.) or the regulations thereto, Cal. Government Code section 1090, Buyer’s Conflict of Interest Code/Policy or any other conflict of interest Law, Seller may, without the prior written consent of Buyer, transfer or assign this Agreement, including through a Change of Control, to an Affiliate of Seller.

18.4 P
ermitted Assignment by Buyer. Buyer may assign its interest in this Agreement to City of San Jacinto without Seller’s consent, provided that City of San Jacinto is a validly existing community choice aggregator, duly organized, validly existing and in good standing under the laws of the State of California and the rules, regulations and orders of the CPU C at such time and either (i) City of San Jacinto and this Agreement are still subject to a Member Lockbox Arrangement for the benefit of Seller in accordance with Section 10.5 or (ii) City of San Jacinto has provided other performance assurance reasonably acceptable to Seller; provided, further, that in each such case, no fewer than fifteen (15) Business Days before such assignment Buyer (x) notifies Seller of such assignment and (y) provides to Seller a written agreement signed by the Person to which Buyer wishes to assign its interests stating that such Person agrees to assume all

48 Energy Storage Resource Adequacy Agreement Form
of Buyer’s obligations and liabilities under this Agreement . Any assignment by Buyer, its successors or assigns under this Section 18.4 shall be of no force and effect unless and until such Notice and agreement by the assignee have been received and accepted by Seller.

18.5 U nauthorized Assignment; Costs .
(a) Any assignment or purported assignment in violation of this Article 18 is void.
(b) No assignment of this Agreement shall be effective unless such assignment is memorialized in a written agreement signed by the assignee and, except in connection with a collateral financing, in which agreement the assignee assumes all of the assignor’s obligations and liabilities under this Agreement.
(c) Seller shall be responsible for Buyer’s reasonable costs associated with the preparation, review, execution and delivery of documents in connection with any assignment of this Agreement, including without limitation reasonable attorneys’ fees.

ARTICLE 19: DISPUTE RESOLUTION

19.1 Governing Law. This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the State of California, without regard to principles of conflicts of law. The Parties agree that any suit, action or other legal proceeding by or against any Party (or its Affiliates or designees) with respect to or arising out of this Agreement shall be brought in the federal courts of the United States Central District of California, or the courts of the State of California sitting in the County of Los Angeles, California.

19.2 D
ispute Resolution . In the event of any dispute arising under this Agreement, within ten (10) days following the receipt of a written Notice from either Party identifying such dispute, the Parties shall meet, negotiate and attempt, in good faith, to resolve the dispute quickly, informally and inexpensively. If the Parties are unable to resolve a dispute arising hereunder within the earlier of either thirty (30) days of initiating such discussions, or within forty (40) days after Notice of the dispute, the parties shall submit the dispute to mediation prior to seeking any and all remedies available to it at l aw in or equity. The Parties wil l cooperate in selecting a qualified neutral mediator selected from a panel of neutrals and in scheduling the time and place of the mediation as soon as reasonably possible, but in no event later than thirty (30) days after the request for mediation is made. The Parties agree to participate in the mediation in good faith and to share the costs of the mediation, including the mediator’s fee, equally, but such shared costs shall not include each Party’s own attorneys’ fees and costs, which shall be borne solely by such Party. If the mediation is unsuccessful, then either Party may seek any and all remedies available to it at law or in equity, subject to the limitations set forth in this Agreement. To the fullest extent permitted under applicable Law, any statute of limitations applicable to a dispute that is mediated by the Parties pursuant to this Agreement shall toll during any period in which such dispute is being mediated in accordance with this Section 19.2.

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ARTICLE 20: CONFIDENTIAL INFORMATION

20.1 Confidential Information. Throughout the Term, neither Party shall disclose (a) the non-public terms or conditions of this Agreement or (b) information disclosed to such Party by the other Party that is (i) marked or expressly identified as “confidential” and (ii) accompanied by a statutory reference to the applicable section of the Public Records Act pursuant to which such information may be kept confidential (collectively, “Confidential Information”) to a third party.

20.2 Permitted Disclosures. A Party may disclose Confidential Information: (a) to the Party’s Affiliates and the Party ’s and its Affiliate’s employees, counsel, accountants, advisors, lenders, or equity investors who have a need to know such information and have agreed to keep such terms confidential; ( b) in order to comply with any applicable Law or any exchange, regulation, Balancing Authority, control area or Transmission Provider rule, or order issued by a court or entity with competent jurisdiction over the disclosing Party ( “Disclosing Party”), other than to those entities set forth in subsection ( c); or (c) in order to comply with any applicable regulation, rule, or order of the CPUC, CEC, or FERC.
(a) P rocedure for Permitted Disclosures . In connection with requests made pursuant to Section 20.2(b) (“Disclosure Order”), each Party shall, to the extent practicable, use reasonable efforts to: (A) N otify the other Party prior to disclosing the Confidential Information and (B) prevent or limit such disclosure. After using such reasonable efforts, the Disclosing Party shall not be: (I) prohibited from complying with a Disclosure Order or (II) liable to the other Party for monetary or other damages incurred in connection with such disclosures of the Confidential Information.
(b) D
isclosure Requests . If a Party (“ Receiving Party”) receives a request from a third party for access to, or inspection, disclosure or copying of, any of the other Party’s (the “Supplying Party ”) Confidential Information (“ Disclosure Request”), then the Receiving Party shall provide Notice and a copy of the Disclosure Request to the Supplying Party promptly after receipt of the Disclosure Request. Within three (3) Business Days of receipt of such Notice, the Supplying Party may provide a Notice to the Receiving Party stating that the Supplying Party believes there are reasonable legal grounds for denying or objecting to the Disclosure Request and will seek a protective order or other judicial determination to protect the confidential information, in such case, the Supplying Party will cover all of its own costs and further agrees to indemnify and pay any and all costs incurred by Receiving Party as a result of the Supplying Party’s attempts to protect from disclosure the information. If the Supplying Party does not seek or does not receive a protective order or other judicial determination protecting the Confidential Information, the Receiving Party may disclose the Confidential Information, which disclosure will not be considered a violation of this Agreement. The Parties recognize that Buyer is a public entity subject to the provisions of the California Public Records Act, and that disclosures made thereunder shall not be considered a violation of this Agreement.

20.3 R
emedies . Except as provided in Section 20.2 with respect to the Parties’ permitted disclosures, the Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, this confidentiality obligation.

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ARTICLE 21: GENERAL PROVISIONS

21.1 Entire Agreement; Integration; Exhibits. This Agreement constitutes the entire agreement and understanding between Seller and Buyer with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof, which are of no further force or effect. The Cover Sheet and any exhibit, appendix, or other attachment hereto is an integral part hereof and is made a part of this Agreement by reference. This Agreement shall be considered for all purposes as prepared through the joint efforts of the Parties and shall not be construed against one Party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof.

21.2 A
mendments . This Agreement may only be amended, modified or supplemented by an instrument in writing executed by duly authorized representatives of Seller and Buyer ; provided, that, for the avoidance of doubt, this Agreement may not be amended by electronic mail communications.

21.3 S urvival . Applicable provisions of this Agreement shall continue in effect after termination, to the extent necessary to enforce or complete the duties, obligations or responsibilities of the Parties arising prior to termination. Notwithstanding anything to the contrary in this Agreement, (i) all rights under Sections 15.1 through 15.5 (Indemnities) and any other indemnity rights survive the end of the Term without limit, (ii) all audit rights under Sections

17.2 and 17.3 survive the end of the Term for an additional one (1) year, or as required by applicable Law, (iii) all rights and obligations under Article 20 (Confidentiality) survive the end of the Term without limit, and (iv) all provisions relating to limitations of liability survive without limit.

21.4 Wai
vers . Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default. Any waiver of a default under this Agreement must appear in a writing signed by the waiving Party.

21.5 N
o Agency, Partnership, Joint Venture or Lease. Seller and the agents and employees of Seller shall, in the performance of this Agreement, act in an independent capacity and not as officers or employees or agents of Buyer. Under this Agreement, Seller and Buyer intend to act as Product seller and Product purchaser, respectively, and do not intend to be treated as, and shall not act as, partners in, co-venturers in or lessor/lessee with respect to the Project, the Product or any business related to the Project. This Agreement shall not impart any rights enforceable by any third party other than a permitted successor or assignee bound to this Agreement or, to the extent set forth herein, any Lender or indemnitee. In no event shall Buyer’s receipt or review of any Seller submission, or Buyer’s monitoring of Project data or cooperation in Project operations be construed as an assumption of any responsibility, liability or obligation of Seller for the design, construction or operation of the Project.

21.6 S
everability . In the event that any provision of this Agreement is unenforceable or held to be unenforceable, the Parties agree that all other provisions of this Agreement have force and effect and shall not be affected thereby. The Parties shall, however, use their best endeavors to agree on the replacement of the void, illegal or unenforceable provision(s) with legally

51 Energy Storage Resource Adequacy Agreement Form
acceptable clauses which correspond as closely as possible to the sense and purpose of the affected provision and this Agreement as a whole.

21.7 Mobile Sierra. Notwithstanding any provision of this Agreement, neither Party shall seek, nor shall they support any third party seeking, to prospectively or r etroactively revise the rates, terms or conditions of service of this Agreement through application or complaint to the FERC pursuant to the provisions of the Federal Power Act, absent prior written agreement of the Parties. Further, absent the prior written agreement in writing by both Parties, the standard of review for changes to the rates, terms or conditions of service of this Agreement proposed by a Party, a non-Party, or the FERC acting sua sponte shall be the “public interest” standard of review set forth in United States Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956), and clarified by Morgan Stanley Capital Group, Inc. v. Public Util. Dist. No. 1 of Snohomish, 554 U.S. 527 (2008) and NRG Power Mrkt’g, LLC v. Maine Pub. Util. Comm’n, 558 U.S. 165 (2010).

21.8 C
ounterparts . This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one and the same instrument and each of which shall be deemed an original.

21.9 E
lectronic Delivery . This Agreement may be duly executed and delivered by a Party by execution and electronic format (including portable document format (.pdf)) delivery of the signature page of a counterpart to the other Party, provided that any digital signatures are in compliance with California Code of Regulations, Title 2, Division 7, Chapter 10, Sections 22000 – 22005.

21.10 N
o Recourse to Members of Buyer. Buyer is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) pursuant to its Joint Powers Agreement and is a public entity separate from its constituent members. Except as set forth in Section 21.11, Buyer shall solely be responsible for all debts, obligations and liabilities accruing and arising out of this Agreement. Except as otherwise set forth in this Agreement with respect to the Member Lockbox Arrangement, Seller shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Buyer’s constituent members, or the employees, directors, officers, consultants or advisors or Buyer or its constituent members, in connection with this Agreement.

21.11 L
ockbox Account . For so long as the Member Lockbox Arrangement exists, Buyer’s obligations to make payments with respect to this Agreement are to be made solely from the Member Lockbox Account, as set forth in the applicable Member Security Agreement. For so long as either (a) the Member Lockbox Arrangement exists or (b) Member has provided and continues to maintain Member Performance Security for the benefit of Seller, obligations to make payments under this Agreement do not constitute any kind of indebtedness of Member or create any kind of lien on, or security interest in, any property or revenues of Member, except as set forth in the Member Lockbox Arrangement or Member Performance Security, as applicable.

21.12 F
orward Contract . The Parties intend that this Agreement constitutes a “forward contract” within the meaning of the U.S. Bankruptcy Code, and Buyer and Seller are “forward contract merchants” within the meaning of the U.S. Bankruptcy Code. Each Party agrees that, for

52 Energy Storage Resource Adequacy Agreement Form
all purposes of this Agreement, each Party waives and agrees not to assert the applicability of the provisions of 11 U.S.C. § 366 in any bankruptcy proceeding wherein such Party is a debtor. In any such proceeding, each Party further waives the right to assert that the other Party is a provider of last resort to the extent such term relates to 11 U.S.C. §366 or another provision of 11 U.S.C. § 101-1532.

21.13 Further Assurances. Each of the Parties hereto agree to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by the other Party which are not inconsistent with the provisions of this Agreement and which do not involve the assumptions of obligations other than those provided for in this Agreement, to give full effect to this Agreement and to carry out the intent of this Agreement.

ARTICLE 22: NOTICES

22.1 Addresses for the Delivery of Notices . Any Notice required, permitted, or contemplated hereunder shall be in writing, shall be addressed to the Party to be notified at the address set forth on Appendix VIII or at such other address or addresses as a Party may designate for itself from time to time by Notice hereunder.

22.2 T ime of Delivery. Each Notice required, permitted, or contemplated hereunder shall be deemed to have been validly served, given or delivered as follows: (a) if sent by United States mail with proper first class postage prepaid, three (3) Business Days following the date of the postmark on the envelope in which such Notice was deposited in the United States mail; (b) if sent by a regularly scheduled overnight delivery carrier with delivery fees either prepaid or an arrangement with such carrier made for the payment of such fees, the next Business Day after the same is delivered by the sending Party to such carrier; (c) if sent by electronic communication (including electronic mail or other electronic means) and if concurrently with the transmittal of such electronic communicat ion the sending Party provides a copy of such electronic Notice by hand delivery, United States mail, or express courier, at the time indicated by the time stamp upon delivery; or (d) if delivered in person, upon receipt by the receiving Party. Notwithstanding the foregoing, Notices of outages or other scheduling or dispatch information or requests, may be sent by electronic communication and shall be considered delivered upon successful completion of such transmission.

53 Energy Storage Resource Adequacy Agreement Form

SIGNATURES
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Effective Date.

SANTA PAULA ENERGY STORAGE,
LLC

By:

Name:

Title:

CALIFORNIA CHOICE ENERGY
AUTHORITY, a California joint powers
authority

By:

Name:

Title:

Acknowledged: City of San Jacinto, a California municipal corporation (d/b/a San Jacinto Power)

CITY OF SAN JACINTO

By:

Name:

Title:

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Energy Storage Resource Adequacy Agreement Form

APPENDIX I

DESCRIPTION OF PROJECT
The following describes the Project to be constructed, operated and maintained by Seller through the Term in accordance with the Agreement.

A. PROJECT DESCRIPTION
Project name:

Technology type:

Project physical address:

I
nterconnection:

CAISO transmission access charge area (e.g. PG&E):

Point of interconnection:

Existing zone (e.g. NP-15):

PNode: TBD
CAISO Resource ID: TBD
B. PROJECT SIZE
Nameplate capacity (NQC):

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Energy Storage Resource Adequacy Agreement Form
The following describes the Operational Characteristics to determine the amount of Capacity Attributes of Product generated by the entire Project, including Capacity Attributes of Product associated with portions of the Project that are being purchased by third parties. The Capacity Attributes of Product being sold and transferred under this Agreement are limited to the Contract Amounts set forth on the Cover Sheet.

APPENDIX II

OPERATIONAL CHARACTERISTICS
The following describes the Operational C haracteristics to determine the amount of Capacity Attributes of Product.

Physical Location and Point of Interconnection
Shall be as set forth in Appendix I-A.

Discharging and Charging
Maximum continuous discharge power (Dmax):

Minimum continuous discharge power (Dmin):

Maximum discharge duration at constant Dmax :

Maximum continuous charge power (Cmax):

Minimum continuous charge power (Cmin):

Maximum charge duration at constant Cmax:

Amount of Energy released to fully discharge:

Amount of Energy required to fully charge:

Round-trip efficiency:

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Energy Storage Resource Adequacy Agreement Form
Ramp Rates
Dmin to Dmax:

Cmin to Cmax:

Dmax to Dmin:

C
max to Cmin:

System Response Time
Idle to Dmax:

Idle to Cmax:

Dmax to Cmax:

Cmax to Dmax:

Dmin to Cmin:

Cmin to Dmin:

Discharge Start-up time (from notification to Dmin):

Charge Start-up time (from notification to Cmin):

Discharge Start-up Fuel:

Starts and other Run Time Limitations
Start limitations: None
Run hour limitations: None
The minimum run time after a Discharge Start-up is 0 seconds The minimum run time after a Charge Start-up is 0 seconds The minimum down time after a shutdown is 0 seconds
Ancillary Services (
defined terms below have the meaning found in the CAISO Tariff as of the Effective Date):

At ISO conditions, normal efficiency mode:

S
pinning Reserves: Range:

Non-Spinning Reserves: Range:

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Energy Storage Resource Adequacy Agreement Form
Regulation Up: Range:

Regulation Down: Range:

Black Start capability (if applicable):

Other:

Voltage Services

Generator voltage regulation range (+/-):

Maximum reactive power leading:

Maximum reactive power lagging:

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Energy Storage Resource Adequacy Agreement Form

APPENDIX III

PROGRESS REPORTING FORM
Each Progress Report must include the following items:

1. Executive Summary.

2. Project description.

3. Site plan of the Project.

4. Description of any material planned changes to the Project or the Site.

5. Schedule showing progress on Project construction generally and achieving the Commercial Operation Milestone and the Initial Delivery Date.

6. Summary of activities during the previous month, including any OSHA labor hour reports.

7. Forecast of activities scheduled for the current calendar quarter.

8. Written description about the progress relative to the Commercial Operation Milestone and the Initial Delivery Date, including whether Seller is on schedule with respect to the same.

9. List of issues that are likely to potentially affect achievement of the Commercial Operation Milestone and the Initial Delivery Date.

10. Progress and schedule of the EPC Contract, all major equipment supply agreements, Governmental Approvals, technical studies, and financing arrangements.

11. Pictures, in sufficient quantity and of appropriate detail, in order to document construction and interconnection progress.

12. Compliance with workforce and prevailing wage requirements.

13. Any other documentation reasonably requested by Buyer.

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APPENDIX IV

CERTIFICATION

FOR COMMERCIAL OPERATION

This certification of commercial operation (“ Certification”) is delivered by each of _______ (“ Seller”) and ________ (“Engineer”) to California Choice Energy Authority, a California joint powers authority (“Buyer” ) in accordance with the terms of that certain Energy Storage Resource Adequacy Agreement dated _______ (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this Certification but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

Seller and Engineer each hereby certifies and represents to Buyer the following, severally and not jointly:

(1) The Project became Commercially Operable on [ ]. (2) T he Project has been constructed in accordance with Appendix I of the Agreement. (3) The Project has been constructed in accordance with the Project Safety Plan. (4) The Project is capable of producing and delivering Capacity Attributes of Product in the Contract Amounts, and a performance test was conducted to confirm this capability.
(5) Seller has designed and built the Project to have a design life for the Delivery Term in accordance with Prudent Operating Practices.
(6) The design and construction of the Project was carried out by the original equipment manufacturer or other qualified organization in accordance with the designs and requirements of the original equipment manufacturer.

SELLER: ENGINEER:

Signature: Signature:

Name: Name:

Title: Title:

Date: Date:

License
Number:

LPE Stamp:

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Energy Storage Resource Adequacy Agreement Form

APPENDIX V-A

FORM OF LETTER OF CREDIT

[Issuing Bank Letterhead and Address]

IRREVOCABLE STANDBY LETTER OF CREDIT NO. [XXXXXXX]
Date:

Bank Ref.:

Amount: US$[XXXXXXXX]
Expiry Date:

Beneficiary:

California Choice Energy Authority
44933 Fern Avenue
Lancaster, CA 93534
Attn: Executive Director
Ladies and Gentlemen:

By the order of __________ (“Applicant”), we, [insert bank name and address] (“Issuer”) hereby issue our Irrevocable Standby Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) in favor of California Choice Energy Authority, a California joint powers authority (“Beneficiary”), for an amount not to exceed the aggregate sum of U.S. $[XXXXXX] (United States Dollars [XXXXX] and 00/100), pursuant to that certain Energy Storage Resource Adequacy Agreement dated as of ______ and as amended (the “Agreement”) between Applicant and Beneficiary. This Letter of Credit shall become effective immediately and shall expire on [Insert Date] which is one year after the issue date of this Letter of Credit, or any expiration date extended in accordance with the terms hereof (the “Expiration Date”).

Funds under this Letter of Credit are available to Beneficiary by presentation on or before the Expiration Date of a dated statement purportedly signed by your duly authorized representative, in the form attached hereto as Exhibit A, containing one of the two alternative paragraphs set forth in paragraph 2 therein, referencing our Letter of Credit No. [XXXXXXX] (“Drawing Certificate”).

The Drawing Certificate may be presented by (a) physical delivery, (b) as a PDF attachment to an e-mail to [bank email address] or (c) facsimile to [bank fax number [XXX -XXX-XXXX]] confirmed by [e-mail to [bank email address]]. Transmittal by facsimile or email shall be deemed delivered when received.

The original of this Letter of Credit (and all amendments, if any) is not required to be presented in connection with any presentment of a Drawing Certificate by Beneficiary hereunder in order to receive payment.

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We hereby agree with the Beneficiary that all documents presented under and in compliance with the terms of this Letter of Credit, that such drafts will be duly honored upon presentation to the Issuer on or before the Expiration Date. All payments made under this Letter of Credit shall be made with Issuer’s own immediately available funds by means of wire transfer in immediately available United States dollars to Beneficiary’s account as indicated by Beneficiary in its Drawing Certificate or in a communication accompanying its Drawing Certificate.

Partial draws are permitted under this Letter of Credit, and this Letter of Credit shall remain in full force and effect with respect to any continuing balance.

It is a condition of this Letter of Credit that the Expiration Date shall be deemed au tomatically extended without an amendment for a one year period beginning on the present Expiration Date hereof and upon each anniversary for such date, unless at least one hundred twenty (120) days prior to any such Expiration Date we have sent to you wri tten notice by overnight courier service that we elect not to extend this Letter of Credit, in which case it will expire on the date specified in such notice. No presentation made under this Letter of Credit after such Expiration Date will be honored.

Notwithstanding any reference in this Letter of Credit to any other documents, instruments or agreements, this Letter of Credit contains the entire agreement between Beneficiary and Issuer relating to the obligations of Issuer hereunder.

This Letter of Credit is subject to the Uniform Customs and Practice for Documentary Credits (2007 Revision) International Chamber of Commerce Publication No. 600 (the “UCP”), except to the extent that the terms hereof are inconsistent with the provisions of the UCP, including but not limited to Articles 14(b) and 36 of the UCP, in which case the terms of this Letter of Credit shall govern. In the event of an act of God, riot, civil commotion, insurrection, war or any other cause beyond Issuer’s control (as defined in Article 36 of the UCP) that interrupts Issuer’s business and causes the place for presentation of the Letter of Credit to be closed for business on the last day for presentation, the Expiration Date of the Letter of Credit will be automatically extended without amendment to a date thirty (30) calendar days after the place for presentation reopens for business.

Please address all correspondence regarding this Letter of Credit to the attention of the Letter of Credit Department at [insert bank address information], referring specifically to Issuer’s Letter of Credit No. [XXXXXXX]. For telephone assistance, please contact Issuer’s Standby Letter of Credit Department at [XXX-XXX-XXXX] and have this Letter of Credit available.

[Bank Name]
___________________________
[Insert officer name]
[Insert officer title]

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Energy Storage Resource Adequacy Agreement Form
(DRAW REQUEST SHOULD BE ON BENEFICIARY’S LETTERHEAD)
Drawing Certificate
[Insert Bank Name and Address]

Ladies and Gentlemen:

The undersigned, a duly authorized representative of California Choice Energy Authority, a California joint powers authority, 44933 Fern Avenue Lancaster, CA 93534, as beneficiary (the “Beneficiary”) of the Irrevocable Letter of Credit No. [XXXXXXX] (the “Letter of Credit”) issued by [insert bank name] (the “Bank”) by order of __________ (the “Applicant”), hereby certifies to the Bank as follows:

1. Applicant and Beneficiary are party to that certain Energy Storage Resource Adequacy Agreement dated as of ___________, 2022 (the “Agreement”).

2. Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________ bec ause a Seller ’s Event of Default (as such term is defined in the Agreement) has occurred or other occasion provided for in the Agreement where Beneficiary is authorized to draw on the Letter of Credit has occurred.

OR
Beneficiary is making a drawing under this Letter of Credit in the amount of U.S. $___________, which equals the full available amount under the Letter of Credit, because Applicant is required to maintain the Letter of Credit in force and effect beyond the expiration date of the Letter of Cred it but has failed to provide Beneficiary with a replacement Letter of Credit or other acceptable instrument within thirty (30) days prior to such expiration date.

3. The undersigned is a duly authorized representative of California Choice Energy Authority and is authorized to execute and deliver this Drawing Certificate on behalf of Beneficiary.

You are hereby directed to make payment of the requested amount to California Choice Energy Authority by wire transfer in immediately available funds to the following account:
[Specify account information]
California Choice Energy Authority

_______________________________
Name and Title of Authorized Representative
Date___________________________

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Energy Storage Resource Adequacy Agreement Form

APPENDIX V-B

FORM OF GUARANTY

This Guaranty (this “ Guaranty”) is entered into as of [_____] (the “ Effective Date ”) by and between [_____], a [______] (“ Guarantor”), and California Choice Energy Authority, a California joint powers authority (together with its successors and permitted assigns, “Buyer”).

Recitals
A. Buyer and [SELLER ENTITY], a _____________________ (“Seller”), entered into that certain Energy Storage Resource Adequacy Agreement (as amended, restated or otherwise modified from time to time, the “RA Agreement”) dated as of [____], 2022.

B. Guarantor is entering into this Guaranty as Delivery Term Security to secure Seller’s obligations under the RA Agreement, as required by Section 10.2 of the RA Agreement.

C. It is in the best interest of Guarantor to execute this Guaranty inasmuch as Guarantor will derive substantial direct and indirect benefits from the execution and delivery of the RA Agreement.

D. Initially capitalized terms used but not defined herein have the meaning set forth in the RA Agreement.

Agreement

1. Guaranty. For value received, Guarantor does hereby unconditionally, absolutely and irrevocably guarantee, as primary obligor and not as a surety, to Buyer the full, complete and prompt payment by Seller of any and all amounts and payment obligations now or hereafter owing from Seller to Buyer under the RA Agreement , including, without limitation, compensation for penalties, the Termination Payment, indemnification payments or other damages, as and when required pursuant to the terms of the RA Agreement (the “Guaranteed Amount ”), provided, that Guarantor’s aggregate liability under or arising out of this Guaranty shall not exceed [XXXXXXXXXX] ($XXXXX) (the “Liability Limit”). The Parties understand and agree that any payment by Guarantor or Seller of any portion of the Guaranteed Amount shall thereafter reduce Guarantor’s maximum aggregate liability hereunder on a dollar -for-dollar basis. This Guaranty is an irrevocable, absolute, unconditional and continuing guarantee of the full and punctual payment and performance, and not of collection, of the Guaranteed Amount and, except as otherwise expressly addressed herein, is in no way conditioned upon any requirement that Buyer first attempt to collect the payment of the Guaranteed Amount from Seller, any other guarantor of the Guaranteed Amount or any other Person or entity or resort to any other means of obtaining payment of the Guaranteed Amount. In the event Seller shall fail to duly, completely or punctually pay any Guaranteed Amount as required pursuant to the RA Agreement, Guarantor shall promptly pay such amount as required herein.

2. Demand Notice. For avoidance of doubt, a payment shall be due for purposes of this Guaranty only when and if a payment is due and payable by Seller to Buyer under the terms and conditions of the RA Agreement. If Seller fails to pay any Guaranteed Amount as

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Energy Storage Resource Adequacy Agreement Form
required pursuant to the RA Agreement for ten (10) Business Days following Seller’s receipt of Buyer’s written notice of such failure (the “ Demand Notice”), then Buyer may elect to exercise its rights under this Guaranty and may make a demand upon Guarantor (a “Payment Demand”) for such unpaid Guaranteed Amount. A Payment Demand shall be in writing and shall reasonably specify in what manner and what amount Seller has failed to pay and an explanation of why such payment is due and owing, with a specific statement that Buyer is requesting that Guarantor pay under this Guaranty. Guarantor shall, within five (5) Business Days following its receipt of the Payment Demand, pay the Guaranteed Amount to Buyer.

3. Scope and Duration of Guaranty. This Guaranty applies only to the Guaranteed Amount.

This Guaranty shall continue in full force and effect from the Effective Date until the following have occurred: (x) all Guaranteed Amounts have been paid in full (whether directly or indirectly through set -off or netting of amounts owed by Buyer to Seller) and the Delivery Term has expired or terminated early or (y) replacement Delivery Term Security is provided in an amount and form required by the terms of the RA Agreement.

Further, this Guaranty (a) shall remain in full force and effect without regard to, and shall not be affected or impaired by any invalidity, irregularity or unenforceability in whole or in part of this Guaranty, and (b) subject to the preceding sentence, shall be discharged only by complete performance of the undertakings herein. Without limiting the generality of the foregoing, the obligations of the Guarantor hereunder shall not be released, discharged, or otherwise affected and this Guaranty shall not be invalidated or impaired or otherwise affected for the following reasons:
(i) the extension of time for the payment of any Guaranteed Amount, or
(ii) any amendment, modification or other alteration of the RA Agreement, or
(iii) any indemnity agreement Seller may have from any party, or (iv) any insurance that may be available to cover any loss, except to the extent insurance proceeds are used to satisfy the Guaranteed Amount, or (v) any voluntary or involuntary liquidation, dissolution, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of, or other similar proceeding affecting, Seller or any of its assets, including but not limited to any rejection or other discharge of Seller’s obligations under the RA Agreement imposed by any court, trustee or custodian or any similar official or imposed by any law, statue or regulation, in each such event in any such proceeding, or (vi) the release, modification, waiver or failure to pursue or seek relief with respect to any other guaranty, pledge or security device whatsoever, or (vii) any payment to Buyer by Seller that Buyer subsequently returns to Seller pursuant to court order in any bankruptcy or other debtor -relief proceeding,

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or
(viii) those defenses based upon (A) the legal incapacity or lack of power or authority of any Person, including Seller and any representative of Seller to enter into the RA Agreement or perform its obligations thereunder, (B) lack of due execution, delivery, validity or enforceability, including of the RA Agreement , or (C) Seller’s inability to pay any Guaranteed Amount or perform its obligations under the RA Agreement, or
(ix) any other event or circumstance that may now or hereafter constitute a defense to payment of the Guaranteed Amount, including, without limitation, statute of frauds and accord and satisfaction;
provided that Guarantor reserves the right to assert for itself any def enses, setoffs or counterclaims that Seller is or may be entitled to assert against Buyer (except for such defenses, setoffs or counterclaims that may be asserted by Seller with respect to the RA Agreement, but that are expressly waived under any provision of this Guaranty).

4. Waivers by Guarantor . Guarantor hereby unconditionally waives as a condition precedent to the performance of its obligations hereunder, with the exception of the requirements in Paragraph 2, (a) notice of acceptance, presentment or protest with respect to the Guaranteed Amounts and this Guaranty, (b) notice of any action taken or omitted to be taken by Buyer in reliance hereon, (c) any requirement that Buyer exhaust any right, power or remedy or proceed against Seller under the RA Agree ment, and (d) any event, occurrence or other circumstance which might otherwise constitute a legal or equitable discharge of a surety. Without limiting the generality of the foregoing waiver of surety defenses, it is agreed that the occurrence of any one o r more of the following shall not affect the liability of Guarantor hereunder:
(i) at any time or from time to time, without notice to Guarantor, the time for payment of any Guaranteed Amount shall be extended, or such performance or compliance shall be waived;
(ii) the obligation to pay any Guaranteed Amount shall be modified, supplemented or amended in any respect in accordance with the terms of the RA Agreement;
(iii) any (a) sale, transfer or consolidation of Seller into or with any other entity, (b) sale of substantial assets by, or restructuring of the corporate existence of, Seller or (c) change in ownership of any membership interests of, or other ownership interests in, Seller; or
(iv) the failure by Buyer or any other Person to create, preserve, validate, perfect or protect any security interest granted to, or in favor of, Buyer or any Person.

5. Subrogation. Notwithstanding any payments that may be made hereunder by the Guarantor, Guarantor hereby agrees that until the earlier of payment in full of all

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Guaranteed Amounts or expiration of the Guaranty in accordance with Section 3, it shall not be entitled to, nor shall it seek to, exercise any right or remedy arising by reason of its payment of any Guaranteed Amount under this Guaranty, whether by subrogation or otherwise, against Seller or seek contribution or reimbursement of such payments from Seller.

6. Representations and Warranties . Guarantor hereby represents and warrants that (a) it has all necessary and appropriate [ limited liability company][corporate ] powers and authority and the legal right to execute and deliver, and perform its obligations under, this Guaranty, (b) this Guaranty constitutes its legal, valid and binding obligations enforceable against it in accordance with its terms, except as enforceabi lity may be limited by bankruptcy, insolvency, moratorium and other similar L aws affecting enforcement of creditors’ rights or general principles of equity, (c) the execution, delivery and performance of this Guaranty does not and will not contravene Guara ntor’s organizational documents, any applicable Law or any contractual provisions binding on or affecting Guarantor, (d) there are no actions, suits or proceedings pending before any court, governmental agency or arbitrator, or, to the knowledge of the Guarantor, threatened, against or affecting Guarantor or any of its properties or revenues which may, in any one case or in the aggregate, adversely affect the ability of Guarantor to enter into or perform its obligations under this Guaranty, and (e) no conse nt or authorization of, filing with, or other act by or in respect of, any arbitrator or Governmental Authority, and no consent of any other Person (including, any stockholder or creditor of the Guarantor), that has not heretofore been obtained is required in connection with the execution, delivery, performance, validity or enforceability of this Guaranty by Guarantor.

7. Notices. Notices under this Guaranty shall be deemed received if sent to the address specified below: (i) on the day received if served by overnight express delivery, and (ii) four (4) Business Days after mailing if sent by certified, first class mail, return receipt requested. If transmitted by facsimile, such notice shall be deemed received when the confirmation of transmission thereof is received by the party giving the notice. Any party may change its address or facsimile to which notice is given hereunder by providing notice of the same in accordance with this Paragraph 7.

If delivered to Buyer, to it at
[____]
Attn: [____]
Fax: [____]

If delivered to Guarantor, to it at [____]
Attn: [____]
Fax: [____]

8. Governing Law and Forum Selection . This Guaranty shall be governed by, and interpreted and construed in accordance with, the laws of the United States and the State of California, excluding choice of law rules. The Parties agree that any suit, action or other

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legal proceeding by or against any party (or its affiliates or designees) with respect to or arising out of this Guaranty shall be brought in the federal courts of the United States or the courts of the State of California sitting in the City and County of Los Angeles , California.

9. Miscellaneous. This Guaranty shall be binding upon Guarantor and its successors and assigns and shall inure to the benefit of Buyer and its successors and permitted assigns pursuant to the RA Agreement. No provision of this Guaranty may be amended or waived except by a written instrument executed by Guarantor and Buyer. This Guaranty is not assignable by Guarantor without the prior written consent of Buyer. No provision of this Guaranty confers, nor is any provision intended to confer, upon any third party (other than Buyer’s successors and permitted assigns) any benefit or right enforceable at the option of that third party. This Guaranty embodies the entire agreement and understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior or contemporaneous agreements and understandings of the parties hereto, verbal or written, relating to the subject matter hereof. If any provision of this Guaranty is determined to be illegal or unenforceable (i) such provision shall be deemed restated in accordance with applicable Laws to reflect, as nearly as possible, the original intention of the parties hereto and (ii) su ch determination shall not affect any other provision of this Guaranty and all other provisions shall remain in full force and effect. This Guaranty may be executed in any number of separate counterparts, each of which when so executed shall be deemed an original, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. This Guaranty may be executed and delivered by electronic means with the same force and effect as if the same was a fully executed and delivered original manual counterpart.

[Signature on next page]

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IN WITNESS WHEREOF, the undersigned has caused this Guaranty to be duly executed and delivered by its duly authorized representative on the date first above written.

GUARANTOR:

[_______]

By:______________________________

Printed Name:__________________
Title:____________________________

BUYER:

[_______]

By:______________________________

Printed Name:__________________
Title:____________________________

By:______________________________

Printed Name:__________________
Title:____________________________

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APPENDIX VI

PROJECT SAFETY PLAN AND DOCUMENTATION
Project Safety Plan Elements:

Part One: Safety Requirements and Safety Programs
Identify the applicable safety -related codes, standards, and regulations (CSR) which govern the design, construction, operation, maintenance of the Project using the proposed technology.

Describe the Seller’s and the Seller’s Contractor(s)’ safety programs and policies. Describe Seller’s compliance with any safety -related industry standards or any industry certifications (American National Standards Institute (ANSI), International Organization for Standardization (ISO), etc.), if applicable.

Part Two: Project Design and Description
Describe Seller’s safety engineering approach to select equipment and design systems and the Project to reduce risks and mitigate the impacts of safety -related incidents, including cascading failures, excessive temperatures, thermal runaways, fires, ex plosions, disk fractures, hazardous chemical releases.

Describe the results of any failure mode effects analyses (FMEA) or similar safety engineering evaluations. In the case of lithium ion batteries, describe the safety- related reasons, including design features and historical safety records, for selecting particular anode and cathode materials and a particular manufacturer.

Provide a list of major facility components, systems, materials, and associated equipment, which includes but is not limited to, the following information:
a) Equipment manufacturer’s datasheet, model numbers, etc., b) Technical specifications,
c) Equipment safety- related certifications (e.g. UL),
d) Safety-related systems, and
e) Approximate volumes and types of hazardous materials expected to be on Site.

Part Three: Project Safety Management
Identify and describe any hazards and risks to life, safety, public health, property, or the environment due to or arising from the Project. Describe the Seller’s applicable site-specific safety plans, risk mitigation, Safeguards and layers of protection, including but not necessarily limited to:
a) Engineering controls,
b) Work practices,
c) Administrative controls,
d) Personal protective equipment and procedures,
e) Incident response and recovery plans,
f) Contractor pre-qualification and management,

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g) Operating procedures,
h) Emergency plans,
i) Training and qualification programs,
j) Disposal, recycle, transportation and reuse procedures, and k) Physical security measures.

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APPENDIX VII

MUA DECISION ATTESTATION
This attestation is delivered by _______(“Seller”) to California Choice Energy Authority, a California joint powers authority (“Buyer”) in accordance with the terms of that certain Energy Storage Resource Adequacy Agreement dated _______ (“Agreement”) by and between Seller and Buyer. All capitalized terms used in this attestation but not otherwise defined herein shall have the respective meanings assigned to such terms in the Agreement.

Seller hereby certifies and represents to Buyer, as of the date set forth below, that with regard to the Project, Seller is following all the rules set forth in Appendix A of CPUC Decision 18-01-003 on Multiple -Use Application Issues, issued January 17, 2018, regarding the multiple -use applications of energy storage facilities.

EXECUTED by SELLER this ________ day of _____________, 20__.

Signature:

Name:

Title:

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APPENDIX VIII

NOTICES

SELLER BUYER
All Notices:

Name: Santa Paula Energy Storage, LLC
Street: 65 Enterprise, 3 rd Floor
City: Aliso Viejo, CA. 92656
Attn: Development

Phone: (949) 330-6300
Email: [email protected]

With a copy to:

Rishad Olpadwala, Vice President
Development
65 Enterprise, 3
rd Floor
Aliso Viejo, CA 92656
[email protected]
All Notices:

California Choice Energy Authority
Attn: Cathy DeFalco
44933 Fern Avenue
Lancaster, CA 93534

Phone: 805-260-9047
E-mail: [email protected]

Invoices:

Attn: Lizette Vidrio
Phone: (949) 330-6300
E-mail: [email protected]
Invoices:

Attn: Brian Goldstein
Phone: 215-498-0175
Email: [email protected]
Scheduling:

Attn: Lizette Vidrio
Phone: (949) 330-6300
Email: [email protected]
Scheduling:

Attn: Brian Goldstein
Phone: 215-498-0175
Email: [email protected]
Payments:

Attn: Lizette Vidrio
Phone: (949) 330-6300
E-mail: [email protected]
Payments:

Attn: Brian Goldstein
Phone: 215-498-0175
Email: [email protected]
Wire Transfer:

BNK:

ABA:

ACCT:

Wire Transfer:

BNK: Wells Fargo
ABA:121000248
ACCT: *****8540
Emergency Contact:

Attn: Lizette Vidrio, Director of Asset
Management
Phone: (949) 330-6300
E-mail:[email protected]
Emergency Contact:

Attn: Cathy DeFalco
Phone: 805-260-9047
E-mail: [email protected]

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APPENDIX IX

APPROVED CONTRACTORS

1. Hitachi Energy USA Inc.

2. Goldstar Construction, Inc.

3. DynaPower Company

4. MMR Constructors, Inc.

5. Powin Energy Corporation

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APPENDIX X

[NOT USED]

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APPENDIX XI

[NOT USED]

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Energy Storage Resource Adequacy Agreement Form

APPENDIX XII

WORKFORCE DEVELOPMENT AND COMMUNITY INVESTMENT OBLIGATIONS Seller shall conduct outreach with qualified local contractors, so that local firms have a fair opportunity to compete for Project construction contracts. In addition, Seller shall require that construction contractors utilize locally sourced labor to the extent practicable.

Energy Storage Resource Adequacy Agreement Form

END OF AGREEMENT

STAFF REPORT
California Choice Energy Authority
Date: May 24, 2022
To: Chairman Parris and Authority Members
From: Jason Caudle, Executive Director
Subject: Approve California Choice Energy Authority Entering into Long-Term Resource Adequacy Agreements with Resi Station, LLC on behalf of Apple Valley Choice Energy, Lancaster Choice Energy, Pico Rivera Innovative Municipal Energy, Rancho Mirage Energy Authority, and San Jacinto Power
Recommendations:

1. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Apple Valley Choice Energy.

2. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Lancaster Choice Energy.

3. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Pico Rivera Innovative Municipal Energy.

4. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of Rancho Mirage Energy Authority.

5. Approve California Choice Energy Authority entering into a long-term resource adequacy agreement with Resi Station, LLC on behalf of San Jacinto Power.

Fiscal Impact:

There is no fiscal impact to California Choice Energy Authority.

Background:

CCEA CC 2
05/24/22
JC
In November 2019, the CPUC adopted Decision 19-11-016 (the Decision). The Decision seeks to ensure that there are sufficient resources available to ensure electric grid reliability for years 2021 - 2023 and imposes procurement requirements on all load-serving entities (LSEs), including Community Choice Aggregators (CCAs).

The Decision orders the procurement of 3,300 MW of new generation resources to come online in the years 2021 – 2023, with all resources coming from zero-emitting sources of non-fossil fuel resources. All LSEs must contract for clean resources, such as renewable energy, stand-alone battery storage, renewable energy plus battery storage, and demand response. Contracts must be ten years or greater from the initial project delivery to the end of the term.

CalChoice solicited bilateral offers for projects that would meet the requirements of the Decision for those member agencies responsible for procuring the incremental resources: AVCE, LCE, PRIME, RMEA, and SJP. CalChoice and its legal and technical team have negotiated an agreement with demand response provider OhmConnect, Inc. for the Resi Station, LLC project (Resi Station). The project will begin delivering resource adequacy for LCE in August of 2022, and for AVCE, PRIME, RMEA, and SJP in 2023.

As a condition of each agreement, Resi Station recognizes and accepts the secured deposit account in the name of each CCA as credit and collateral, and no other security or credit backing by the cities or CalChoice will be required.

The Town and City Councils of the Town of Apple Valley, and the cities of Lancaster, Pico Rivera, Rancho Mirage, and San Jacinto have, or will have approved CalChoice entering into these agreements at their respective council meetings prior to execution of the agreements.

Attachments:

Sample Power Purchase Agreement
1 WSPP RESOURCE ADEQUACY CONFIRMATION

This Confirmation co nfirms the transaction between and among Resi Station, LLC, a Delaware limited liability company (“Seller”) and California Choice Energy Authority, a California joint powers authority (“CalChoice”) (“Purchaser”), and each individually a “ Party” and together the “Parties”, dated as of May 11, 2022 (the “Effective Date”), by which Seller agrees to sell and deliver, and Purchaser agrees to purchase and receive, the Product as such term is defined in Article 1 of this Confirmation (the “Transaction”). This Transaction is governed by the Western Systems Power Pool Agreement dated August 12, 2021 (the “WSPP Agreement”). The WSPP Agreement and this Confirmation, including any applicable appendices, exhibits or amendments thereto, shall be collectively referred to herein as the “Agreement ” and will constitute a single agreement between the Parties with respect to the Transaction. Capitalized terms not otherwise defined in this Confirmation or the WSPP Agreement are defined in the Tariff or the CPUC Filing Guide. To the extent the terms of this Confirmation conflict with the WSP P Agreement, the terms of this Confirmation shall control. Purchaser is entering into this Transaction on behalf of its Member, City of Lancaster, a California municipal corporation and charter city (d/b/a Lancaster Choice Energy).

ARTICL
E 1

TRANSACTION TERMS

Product, Delivery Period, Contract Quantity, Contract Price and other specifics of the Product are in Appendix B. Appendices A, B, C, and D are incorporated into this Confirmation.

☒ Firm RA Product:

Seller shall provide Purchaser with the Product from the Unit in the amount of the Contract Quantity. If the Unit is not available to provide the full amount of the Contract Quantity for any reason, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Purchaser with the Contract Quantity and has failed to supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period, the n Seller shall be liable for damages and/or required to indemnify Purchaser for penalties or fines pursuant to the terms of Section 2.5.

☐ Contingent Firm RA Product:

Seller shall provide Purchaser with Product from the Unit in the amount of the Contract Quantity.

If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reduction of the Contract Quantity of the Unit in accordance with Section 2.2, Seller shall have the option to notify Purchaser that either (a) Seller will not provide the portion of the Contract Quantity attributable to such reduction during the period of such non-availability; or (b) Seller will supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period pursuant to Section 2.3. If the Unit is not available to provide the full amount of the Contract Quantity as a result of any reason other than as provided in Section 2.2, then Seller shall have the option to supply Alternate Capacity pursuant to Section 2.3 to fulfill the remainder of the Contract Quantity during such period. If Seller fails to provide Purchaser with the Contract Quantity (subject to any 2 permitted reductions pursuant to Section 2.2) from the Unit and has failed to supply Alternate Capacity to fulfill the remainder of the Contract Quantity during such period, then Seller shall be liable for damages and/or required to indemnify Purchaser for penalties or fines pursuant to the terms of Section 2.5.

ARTICLE 2

DELIVERY OBLIGATIONS AND ADJUS TMENTS

2.1 Sale and Delivery of Product

(a) For each Showing Month of the Delivery Period, Seller shall sell and del iver to Purchaser, and Purchaser shall purchase and receive from Seller , the Contract Quantity of the Product from the Shown Unit(s). Seller’s obligation to deliver the Contract Quantity of Product for the Delivery Period is firm and will not be excused for any reason except as excused by an express provision of this Agreement.

(b) Seller shall deliver the Contract Quantity by submitting to CAISO in its Supply Plan the Shown Unit(s) and the characteristics of the Shown Unit (s) and Product for Purchaser in the amount of the Expected Contract Quantity, as further specified in Appendix B, all in compliance with this Confirmation.

(c) Seller shall cause all Supply Plans to meet and be filed in conformance with the requirements of the CPUC and the Tariff. Seller shall submit, or cause the Shown Unit’s SC to submit, on a timely basis with respect to each applicable Showing Month, Supply Plans in accordance with the Tariff and CPUC requirements to identify and confirm the Product delivered to Purchaser for each Showing Month of the Delivery Period. T he total amount of Product identified and confirmed for such Showing Month shall equal the Expected Contract Quantity.

(d) Seller may sell and deliver Product from a Shown Unit that meets the requirements set forth in Appendix B, provided that a Replacement Unit may be from a different Resource Category than “DR”. In no event shall a Shown Unit utilize coal or coal materials as a source of fuel . A Shown Unit must be a specific resource that is connected directly to the CAISO controlled grid or be under the operational control of CAISO. A Shown Unit may not be an unspecified import. Seller shall identify the Shown Unit(s) and Expected Contract Quantity by providing Purchaser with the specific information contemplated in Appendix B no later than the Notification Deadline for the relevant Showing Month.

(e) If CAISO reject s either the Supply Plan or the Resource Adequacy Plan with respect to any part of the Expected Contract Quantity for the Shown Unit(s) in any Showing Month, the Parties shall confer, make such corrections as are necessary for acceptance, and resubmit the corrected Supply Plan or Resource Adequacy Plan for validation before the applicable deadline for the Showing Month.

3 (f) The Product is delivered and received when the CIRA Tool shows that the Supply Plan submitted in compliance with Purchaser’s instructions, including Purchaser’s instructions to withhold all or part of the Expected Contract Quantity from Seller’s Supply Plan for any Showing Month during the Delivery Period, has been accepted for the Product from the Shown Unit(s) by CAISO. Seller has failed to deliver the Product if (i) Purchaser has elected to submit the Product from the Shown Unit in its Resource Adequacy Plan and such submission is accepted by the CPUC and the CAISO but the Supply Plan and Resource Adequacy Plan are not matched in the CIRA Tool and are rejected by CAISO notwithstanding performance of Section

2.1(e) or (ii) Seller fails to submit the volume of Expected Contract Quantity for any Showing Month in such amount as instructed by Purchaser for the appl icable Showing Month. Seller will not have failed to deliver the Expected Contract Quantity if Purchaser fails or chooses not to submit the Shown Unit (s) and the Product in its Resource Adequacy Plan with the CPUC or CAISO.

(g) The Shown Unit (s) must not have characteristics that would trigger the need for Purchaser or Seller to file an advice letter or other request for authorization with the CPUC or for Purchaser to make a compliance filing pursuant to California Public Utilities Code Section 380.

2.2 Reductions in Contract Quantity

If Seller is providing Contingent Firm RA Product, Seller’s obligation to deliver the Contract Quantity for each Showing Month may be reduced at Seller’s option by the amount of any Planned Outages which exist with respect to any portion of the Unit during the applicable Showing Month; provided, (i) Seller notifies Purchaser by the Notification Deadline applicable to that Showing Month of the amount of Product from the Unit that Purchaser may include in Purchaser’s Compliance Showings applicable to that month as a result of such Planned Outage, and (ii) such reduction is able to be reflected on the Supply Plans in accordance with the Tariff.

In the event Seller is unable to provide the Contract Quantity for any portion of a Showing Month because of a Planned Outage of a Unit, Seller has the option, but not the obligation, to provide Product for such portions of such Showing Month from Replacement Units, provided Seller provides and identifies such Replacement Units in accordance with Section 2.3.

2.3 Seller’s Option To Provide Alternate Capacity

If Seller is unable to provide the full Contract Quantity for a Showi ng Month for any reason,
including, without limitation, as provided in Section 2.2, or Seller desires to provide some or all of the Contract Quantity for any Showing Month from a different generating unit other than the Unit, then Seller may, at no cost to Purchaser, provide Purchaser with replacement Product from one or more replacement units having the same Capacity Attributes, including Net Qualifying Capacity (“NQC”), of the Unit(s ), provided that a Replacement Unit may be from a different Resource Category than “DR” (each such unit, a “Replacement Unit”) in an amount such that the
total amount of NQC provided to Purchaser from the Unit and any Replacement Unit(s) for each Showing Month is equal to the NQC for the Contract Quantity, provided that in each case:
4 (a) Seller shall notify Purchaser in writing of its intent to provide Alternate Capacity and identify the Replacement Units from which such Alternate Capacity shall be provided no later than the Notification Deadline for Purchaser’s Compliance Showings related to such Showing Month;

(b) The Replacement Units must (i) be accepted by the CAISO, (ii) qualify as “incremental” resources pursuant to CPUC Decision D.19-11- 016 and related guidance; and (iii) otherwise satisfy the requirements of this Agreement;

(c) Seller shall, or shall cause the SC to submit a Supply Plan for each Showing Month and, if applicable, annual filing, no later than the Notification Deadline for Purchaser’s Compliance Showings;

(d) If Seller does not comply with the requirements of Sections 2.3(a), (b) and (c) for the applicable Showing Month or , if applicable, annual filing, then any such Replacement Units shall not be deemed a Replacement Unit for purposes of this Confirmation for that Showing Month and Seller shall not receive payment for such replacement Product; and

Once Seller has identified in writing any Replacement Units that mee t the requirements of this Section 2.3 then any such Replacement Units shall be deemed a Unit for purposes of this Confirmation for that Showing Month.

2.4 Planned Outages

As of the Confirmation Effective Date, Seller and Purchaser have agreed to all Planned Outages as specified in Appendix D (“ Planned Outage Schedule”) for all relevant Showing Months for the following calendar year, or until the end of the Delivery Period, whichever is shorter. Seller may provide Purchaser with proposed changes to the Planned Outage Schedule from time to time.

Within ten (10) Business Days after Purchaser’s receipt of any Seller proposed changes, Purchaser shall notify Seller in writing of any reasonable requests for modifications to such Seller proposed changes, and Seller shall, to the extent consistent with Prudent Operating Practice, accommodate Purchaser’s requests regarding the timing of any Seller proposed changes to the Planned Outage Schedule.

2.5 Purchaser’s Remedies f or Seller’s Failure to Deliver the Contract Quantity

(a) If Seller fails to deliver any part of the Contract Quantity as required herein for any Showing Month, Seller shall be liable for damages pursuant to Section 21.3 of the WSPP Agreement, without reference to the word “hourly” therein.

(b) Seller shall indemnify, defend and hold harmless Purchaser from any penalties, fines or costs, including Environmental Costs , assessed against Purchaser by the CPUC, CAISO or other Governmental Body resulting from Seller’s failure to deliver the Product or a Shown Unit’s S C’s failure to timely or accurately submit 5 Supply Plans in accordance with the Tariff and this Confirmation. The Parties shall use commercially reasonable efforts to minimize such penalties, fines or costs; provided, that in no event will Purchaser be required to use or change its utilization of its owned or controlled assets or market positions to minimize these penalties, fines or costs. If Seller fails to pay the foregoing penalties, fines or costs, or fails to reimburse Purchaser for those penalties, fines or costs, then, without prejudice to its other rights and remedies, Purchaser may setoff and recoup those penalties, fines or costs against any future amounts it may owe to Seller under this Confirmation or the WSPP Agreement.

2.6 Purchaser’s Re-Sa
le of Product

(a) Purchaser may re-sell all or part of the Product; provided that any such re-sale must not increase Seller’s obligations hereunder other than as set forth in this Section

2.6(a) or require Seller to have any obligation to a Subsequent Purchaser. For any such a resale, the Resource Adequacy Plan of Purchaser as used herein will refer to the Resource Adequacy Plan of Subsequent Purchaser. Seller shall, or shall cause the Shown Unit’s SC, to follow Purchaser’s instructions with respect to providing such resold Product to Subsequent P urchasers, to the extent such instructions are consistent with Seller’s obligations under this Confirmation. Seller shall, and shall cause the Shown Unit’s SC, to take all commercially reasonable actions and execute all documents or instruments reasonably necessary to allow such Subsequent Purchasers to use such resold Product in a manner consistent with Purchaser’s rights under this Confirmation. If Purchaser incurs any liability to a Subsequent Purchaser due to the failure of Seller or the Sh own Unit’s SC to comply with this Confirmation, Seller will be liable to Purchaser for the amounts Seller would have owed Purchaser under this Confirmation if Purchaser had not resold the Product.

(b) Purchaser shall notify Seller in writing of any resale of Product and the Subsequent Purchaser no later than two (2) Business Days before the Notification Deadline for each Showing Month for which Purchaser has resold the Product. Purchaser shall notify Seller of any subsequent changes or further resale s no later than two (2) Business Days before the Notification Deadline for the Showing Month.

(c) If CAISO or CPUC develops a centralized capacity market, Purchaser will have exclusive rights to direct the Seller or the Unit’s S C to offer, bid, or otherwise submit the Expected Contract Quantity of Product for re-sale in such market, Seller and the Unit’s S C shall comply with Purchaser’s direction and Purchaser shall retain and receive all revenues from such re-sale.

ARTICLE 3

PAYMENTS

3.1 Payment

7 Seller shall schedule or cause the Shown Unit’s SC to schedule or make available to CAISO the Expected Contract Quantity of the Product during the Delivery Period, in compliance with the Tariff, and perform all, or caus e the Shown Unit’s SC, owner, or operator to perform all , obligations under applicable law and the Tariff relating to the Product. Purchaser is not liable for, and Seller shall indemnify and hold Purchaser harmless from, the failure of Seller or the Shown Unit’s SC, owner, or operator to comply with the Tariff, and for any penalties , fines or costs imposed on Seller or the Shown Unit’s SC, owner, or operator for noncompliance.

4.2 Seller’s a
nd Purchaser’s Duties to Take Actions to Allow Product Utilization

Throughout the Delivery Period, Purchaser and Seller shall take all commercially reasonable actions and execute all documents or instruments reasonably necessary to ensure (a) Purchaser ’s rights to the Contract Quantity for the sole benefit of Purchaser or any Subsequent Purchaser and (b) that Purchaser may use the Contract Quantity to meet its Compliance Obligations . Such commercially reasonable actions shall include, without limitation cooperating with and providing, and causing each Shown Unit’s SC, owner, or operator to cooperate with and provide, requested supporting documentation to the CAISO, the CPUC, or any other Governmental Body responsible for administering the applicable Compliance Obligations, including to demonstrate that the Expected Contract Quantity can be delivered to the CAISO controlled grid for the minimum hours required to satisfy the Compliance Obligations, as applicable, pursuant to the “deliverability” standards established by the CAISO or other Governmental Body of competent jurisdiction.

Seller’s reasonable and documented third party costs associated with taking commercially reasonable actions under this Section 4.2 for the benefit of Subsequent Purchaser shall be reimbursed by Purchaser.

If necessary, the Parties further agree to negotiate in good faith to amend this Confirmation to conform this Transaction to subsequent clarifications, revisions, or decisions rendered by CAISO or an applicable Governmental Body to maintain the benefits of the Transaction.

4.3 Seller’s R
epresentations and Warranties

Seller represents and warrants to Purchaser throughout the Delivery Period that:

(a) Seller has the right to sell the Product from the Facility;

(b) The Product includes the right to claim the Contract Quantity as an incremental resource for purposes of CPUC D.19-11-016;

(c) Seller has not sold the Product, including, the right to claim the Contract Capacity as an incremental resource for purposes of CPUC D.19-11-016, to any other person or entity;

(d) The Product is free and clear of all liens or other encumbrances;

8 (e) No part of the Contract Quantity during the Delivery Period has been committed by Seller to any third party to satisfy Compliance Obligations or analogous obligations in any CAISO or non-CAISO markets;

(f) The Shown Unit(s) qualify to provide the Product under the Tariff, and the Shown Unit(s) and Seller are capable of delivering the Product;

(g) The aggregation of all amounts of Capacity Attributes that Seller has sold, assigned, or transferred for the Shown Unit(s) during the Delivery Period does not exceed the Shown Unit’s Net Qualifying Capacity and, if applicable, the Effective Flexible Capacity for that Shown Unit;

(h) If applicable, Seller has notified either the Shown Unit’s SC or the entity from which Seller purchased the Product that Seller has transferred the Contract Quantity of Product for the Delivery Period to Purchaser; and

(i) Seller has notified or will notify the Shown Unit’s SC that Purchaser is entitled to the revenues set forth in Section 3.2(b), and such Shown Unit’s SC is obligated to promptly deliver those revenues to Purchaser, along with appropriate documentation supporting the amount of those revenues.

4.4 Events of Default

Notwithstanding Section 22.1 of the WSPP Agreement, an “Event of Default ” shall mean, with respect to a Party (the “Defaulting Party”) that is subject to the Event of Default the occurrence of any of the following:
(i) the failure by such Party to make, when due, any payment required pursuant to this Ag
reement and such failure is not remedied within ten (10) Business Days after Notice thereof;
(ii) any representation or warranty made by such Party herein is false or misleading in any material respect when made or when deemed made or repeated , and such default is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30) -day period despite exercising commercially reasonable efforts);
(iii) the failure by such Party to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default set forth in this Section 4.4) and such failure is not remedied within thirty (30) days after Notice thereof (or such longer additional period, not to exceed an additional 9 sixty (60) days, if the Defaulting Party is unable to remedy such default within such initial thirty (30)-day period despite exercising commercially reasonable efforts); (iv) such Party becomes Bankrupt;
(v) such Party assigns this Agreement or any of its rights hereunder other than in compliance with Section 4.7, as appropriate; or
(vi) failure to satisfy the performance assurance requirements pursuant to Section 4.5 after Notice and expiration of the cure periods set forth therein.

4.5 Seller Performance Assurance

Seller shall post Development Security and Performance Security (“Performance Assurance”) in the amount specified in Appendix B subject to the terms and conditions set forth herein. (a) Seller’s Development Security. To secure its obligations under this Agreement, Seller shall deliver the Development Security to Purchaser within thirty (30) days after the Effective Date. Developmen t Security shall be in the form of cash or a Letter of Credit. Seller shall maintain the Development Security in full force and effect. Upon the earlier of (i) Seller’s delivery of the Performance Security, or (ii) sixty (60) days after termination of this Agreement, Purchaser shall return the Development Security to Seller, less the amounts drawn in accordance with this Agreement. If the Development Security is a Letter of Credit and the issuer of such Letter of Credit (x) fails to maintain the minimum Credit Rating specified in the definition of Letter of Credit, (y) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the Initial Delivery Date, or (z) fails to honor Purchaser’s properly documented request to draw on such Letter of Credit by such issuer, Seller shall have ten (10) Business Days to either post cash or deliver a substitute Letter of Credit that meets the requirements set forth in the definition of Development Security.
(b) Seller’s Performance Security. To
secure its obligations under this Agreement,
Seller shall deliver Performance Security to Purchaser on or before the Initial Delivery Date. Within five (5) Business Days following any draw by Purchaser on the Performance Security, Seller shall replenish the amount drawn such that the security is restored to the applicable amount. Seller shall maintain the Performance Security in full force and effect, subject to any draws made by Purchaser in accordance with this Agreement, until the following have occurred:
(A) the Delivery Period has expired or terminated early; and (B) all payment obligations of the Seller then due and payable under this Agreement, including compensation for penalties, Termination Payment, indemnification payments or other damages are paid in full (whether directly or indirectly such as through set - off or netting). Following the occurrence of both events, Purchaser shall promptly return to Seller the unused portion of the Performance Security. If the Performance Security is a Letter of Credit and the issuer of such Letter of Credit (i) fails to maintain the minimum Credit Rating set forth in the definition of Letter of Credit, 10 (ii) indicates its intent not to renew such Letter of Credit and such Letter of Credit expires prior to the Initial Delivery Date, or (iii) fails to honor Purchaser’s properly documented request to draw on such Letter of Credit by such issuer, Seller shall have ten (10) Business Days to either post cash or deliver a substitute Letter of Credit that meets the requirements set forth in the definition of Performance Security.

4.6 Market Based Rate Authority

Upon Purchaser’s written request, Seller shall, in accordance with FERC Order No. 697, submit a letter of concurrence in support of any affirmative statement by Purchaser that this contractual arrangement does not transfer “ownership or control of generation capacity” from Seller to Purchaser as the term “ownership or control of generation capacity” is used in 18 CFR Section

35.42. Seller shall not, in filings, if any, made subject to Order Nos. 652 and 697, claim that this contractual arrangement conveys ownership or control of generation capacity from Seller to Purchaser.

4.7 Assignment

Notwithstanding Section 14 of the WSPP Agreement and except with respect to collateral assignment to support a financing or refinancing by Seller of the Facility and assignment to an affiliate, neither Party shall assign this Agreement or its rights hereunder without the prior written consent of the other Party, which shall not be unreasonably withheld, except that either Party may assign this Agreement without consent in connection with a merger, reorganization, consolidation, change of control, or sale of all or substantially all of the assets to which this Agreement pertains; provided that the assigning Party provides prompt written notice to the other Party of any such permitted assignment.

ARTICLE 5

FORCE MAJEURE

5.1 Definition

(a) “Force Majeure Event” means any act or event that delays or prevents a Party from timely performing all or a portion of its obligation s under this Agreement or from complying with all or a portion of the conditions under this Agreement if such act or event, despite the exercise of reasonable efforts, cannot be avoided by and is beyond the reasonable control (whether direct or indirect) of and without the fault or negligence of the Party relying thereon as justification for such delay, nonperformance, or noncompliance.

(b) Not
withstanding the foregoing, the term “Force Majeure Event” does not include (i) economic conditions that render a Party’s performance of the RA Agreement at the Contract Price unprofitable or otherwise uneconomic (including an increase in component or compliance costs for any reason, including foreign or domestic tariffs, Purchaser’s ability to buy the Product at a lower price, or Seller’s ability to 11 sell Product at a higher price, than the Contract Price; (ii) Seller’s inability to obtain permits or approvals of any type for the construction, operation, or maintenance of the Facility; or (iii) the inability of a Party to make payments when due under this Agreement, unless the cause of such inability is an event that would otherwise constitute a Force Majeure Event as described above.

5.2 Notice for Force Majeure
As soon as practicable following the commencement of a Force Majeure Event, the non- performing Party shall provide the other Party with oral notice of the event of Force Majeure, and within two (2) weeks of the commencement of the Force Majeure Event the non-performing Party shall provide the other Party with Notice in the form of a letter describing in detail the particulars of the occurrence giving rise to the Force Majeure claim. The suspension of performance due to a claim of Force Majeure must be of no greater scope and of no longer duration than is required by the Force Majeure.

5.3 Termination Following Force Majeure Event
If an event of Force Majeure occurring after the commencement of the Delivery Period delays or prevents a Party from carrying out, substantially, its obligations under this Agreement for a period of 365 consecutive days or longer (so long as the consecutive days of excused performance are continuing), then either Party may terminate this Agreement without liability of either Party arising out of such termination, except liability that arose prior to the date of termination not related to the Force Majeure.

To the extent Seller is prevented from delivering Capacity Attributes from the Facility due to a Force Majeure Event, Seller shall have the option, but not the obligation, to provide Replacement RA.

ARTICLE 6

ADDITIONAL WSPP AGREEMENT AMENDMENTS; GENERAL PROVISIONS

6.1 Termination Payment

For this Transaction, the following is inserted as a penultimate paragraph in Section 22.2(b) of the WSPP Agreement:

“If Purchaser is the Non-Defaulting Party and Purchaser reasonably expects to incur or be liable for any penalties, fines or costs from CAISO, or any Governmental Body, because Purchaser or a Subsequent Purchaser is not able to include the applicable Contract Quantity in a Compliance Showing due to Seller’s Event of Default, then Purchaser may, in good faith and with commercially reasonable practices, estimate the amount of those penalties , fines or costs and include the estimate in its determination of the Termination Payment, subject to accounting to Seller when those penalties, fines or costs are finally ascertained.

If this accounting establishes that Purchaser ’s estimate exceeds the actual amount of penalties, fines or costs, Purchaser must promptly remit to Seller the excess amount with 12 interest in accordance with Section 9.3 of the WSPP Agreement. The rights and obligations with respect to determining and paying any Termination Payment, and any dispute resolution provisions with respect thereto, survive the termination of this Transaction and continue until after those penalties, fines or costs are finally ascertained.”

6.2 Confidentiality

Notwithstanding Section 30.1 of the WSPP Agreement:

(a) (i) Purchaser may disclose information as necessary in order to support its Compliance Showings or otherwise show it has met its Compliance Obligations; (ii) Seller may disclose information as necessary to a Shown Unit’s SC or as necessary for Supply Plans; (iii) each Party may disclose information as necessary to the independent evaluator or other administrator of any competitive solicitation process of Purchaser, which in turn may disclose such information as necessary to CAISO or any Governmental Body; and ( iv) Purchaser may disclose information to any Subsequent Purchaser.

(b) Seller acknowledges that Purchaser is a public agency subject to the requirements of t
he California Public Records Act (Cal. Gov. Code section 6250 et seq.) and that Purchaser may be required to make public this Confirmation (which may be partially redacted by Purchaser) in connection with the process of seeking approval from its board of directors for the execution of this Confirmation. Seller may submit information to Purchaser that Seller considers confidential, proprietary, or trade secret information pursuant the Uniform Trade Secrets Act (Cal. Civ. Code section 3426 et seq.), or otherwise protected from disclosure pursuant to an exemption to the California Public Records Act (Government Code sections 6254 and 6255). Seller acknowledges that Purchaser may submit to Seller information that Purchaser considers confidential or proprietary or protected from disclosure pursuant to exemptions to the California Public Records Act (Government Code sections 6254 and 6255). Upon request or demand of any third person or entity not a party to this Confirmation (“Requestor”) pursuant to the California Public Records Act for production, inspection and/or copying of this Confirmation or any information designated by a disclosing Party as confidential, the receiving Party as soon as practical shall notify the disclosing Party that such request has been made, by telephone call, letter sent via electronic mail, and/or by overnight carrier to the address, or email address listed at the end of this Confirmation. The disc losing Party shall be solely responsible for taking whatever legal steps are necessary to protect information deemed by it to be confidential information and to prevent release of information to the Requestor by the r eceiving Party. If the disclosing Party takes no such action within ten (10) days, after receiving the foregoing notice from the receiving Party, the receiving Party shall be permitted to comply with the Requestor’s demand and is not required to defend against it. Notwithstanding the foregoing, Purchaser may release confidential information over the objection of Seller if Purchaser’s legal counsel advises Purchaser that Purchaser is required by 13 law to release such confidential information and Purchaser notifies Seller ahead of such release.

6.3 Dodd-Fra nk Act

The Parties intend this Transaction to be a “customary commercial arrang ement” as described in Section II.A.1 of Commodity Futures Trading Commission, Proposed Guidance, Certain Natural Gas and Electric Power Contracts , 81 Fed. Reg. 20583 at 20586 (Apr. 8, 2016) and a “Forward Capacity Transaction” within the meaning of Commodity Futures Trading Commission, Final Order in Response to a Petition From Certain Independent System Operators and Regional Transmission Organizations To Exempt Specified Transactions Authorized by a Tariff or Protocol Approved by the Federal Energy Regulatory Commission, 78 Fed. Reg. 19,880 (Apr. 2, 2013).

6.4 Resource Adequacy Failure

For each RA Shortfall Month occurring after the Initial Delivery Date, Seller shall pay to Purchaser an am
ount (the “RA Deficiency Amount ”) equal to the lesser of (a) the dollar amount per kW-month listed in Appendix B for the applicable month multiplied by the RA Shortfall Amount, and (b) (i) an amount equal to the positive difference, if any, between (X) Capacity Replacement Price and (Y) the RA Shortfall Amount not provided for in the applicable Showing Month times the Contract Price for that month, plus (ii) any penalties, fines or costs assessed against Purchaser by the CPUC or the CAISO, which shall be supported by reasonable documentation provided by Purchaser.

Sel
ler may, as an alternative to paying RA Deficiency Amounts, provide Replacement RA in amounts up to the RA Shortfall, provided that any Replacement RA capacity is communicated by Seller to Purchaser with Replacement RA pro duct information in a written notice to Purchaser at least twenty (20) Business Days before the deadline (as established by CAISO or any other Governmental Authority) that a load serving entity must meet to submit its resource adequacy plan for the applicable CPUC operating month for the purpose of monthly RA reporting, and further provided that such Replacement RA capacity shall be required to comply with the requirements of D.19-11-016.

To the extent Seller is prevented from delivering Capacity Attribute s from the Facility due to a Force Majeure Event, Seller shall have the option, but not the obligation, to provide Replacement RA.

6.5 Change in Law

If any action by the CPUC, CAISO or any Gover nmental Body having jurisdiction, or any change in applicable law, occurring after the Confirmation Effective Date results in (i) material changes to Purchaser’s or Seller’s obligations with regard to the Products sold hereunder, (ii) has the effect of changing the transfer and sale procedure set forth in this Confirmation so that the performance of this Confirmation becomes impracticable, or (iii) changes the Resource Adequacy Requirements such that the Product can no longer be counted towards Purchaser’s Resource Adequacy Requirements (a “Change in Law ”), the Parties shall work in good faith to revise this 14 Confirmation so that the Parties can perform their obligations regarding the purchase and sale of the Product sold hereunder in order to maintain the original intent.

If a change in law occurring after the Effective Date has increased Seller’s known or reasonably expec
ted costs and expenses to comply with Seller’s obligations under the Confirmation with respect to obtaining, maintaining, conveying or effectuating Purchaser’s use of Resource Adequacy (any action required to be taken by Seller to comply with such change in law, a “Compliance Action”) then the Parties agree that the maximum aggregate amount of costs and expenses Seller shall be required to bear during the Delive ry Period to comply with all such Compliance Actions shall be capped at fifteen thousand dollars ($15,000) per MW of Resource Adequacy Capacity and/or, if applicable, Demand Response Capacity, in the aggregate over the term of this Confirmation (the “Compliance Expenditure Cap”). If Purchaser agrees to fund such Compliance Actions in excess of the foregoing limits, Seller shall take such actions.

6.6 Change in Tax Law

In the event that as a result of a Change in Tax Law, Seller or the Facility becomes eligible for or entitled to any new Tax Benefits or changes to or extensions of existing Tax Benefits, Seller and Purchaser shall share such additional Tax Benefit Amount on a 50%/50% basis by making an adjustment to the Contract Price for the remainder of the Delivery Period.

6.7 Change in Market Structure

If a change in the market structure renders the Confirmation or any provisions thereof incapable of being performed or administered, then either Party may request that the other Party enter into negotiations with the requesting party to make the minimum changes to the Confirmation necessary to make the Confirmation capable of being performed and administered, while attempting to preserve, to the maximum extent possible, the benefits, burdens, and obligations set forth in the Confirmation as of the Effective Date.

6.8 Governing Law

Notwithstanding Section 24 of the WSPP Agreement, this Transaction and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the state of California, without regard to principles of conflicts of law.

6.9 Collateral

Notwithstanding any provision in the WSPP Agreement to the contrary, including Section 27, neither Party shall be required to post collateral or other security for this Transaction, except as provided in Section 4.5 herein.

6.10 No Recourse to Members of Purchaser

Purchaser is organized as a Joint Powers Authority in accordance with the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) pursuant to its Joint Powers Agreement and is a public entity separate from its constituent members. Purchaser shall solely be 15 responsible for all debts, obligations and liabilities accruing and arising out of this Confirmation.

Seller shall have no rights and shall not make any claims, take any actions or assert any remedies against any of Purchaser’s constituent members, including City of Lancaster, in connection with this Confirmation.

6.11 Other WSPP Agreement Changes

For this Transaction, the WSPP Agreement shall be amended as follows:
(a) Section 9.4 is deleted in its entirety and replaced with the following:
“In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due, with notice of the objection given to the other Party.

Any invoice dispute or invoice adjustment shall be in writing and shall state the basis for the dispute or adjustment. Payment of the disputed amount shall not be required until the dispute is resolved. Upon resolution of the dispute, any required payment shall be made within two (2) Business Days of such resolution along with interest accrued at the Interest Rate from and including the due date to but excluding the date paid. Inadvertent overpayments shall be returned upon request or deducted by the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from and including the date of such overpayment to but excluding the date repaid or deducted by the Party receiving such overpayment.

Any dispute with respect to an invoice is waived unless the other Party is notified in writing within twelve (12) months after the invoice is rendered or any specific adjustment to the invoice is made. If an invoice is not rendered within twelve (12) months after the close of the month during which performance of a Transaction occurred, the right to payment for such performance is waived.” (b) Section 22.1 is modified by inserting the following new text at the end thereof:
“(f) the failure of the Defaulting Party to pay its debts generally as they become due or the Defaulting Party’s admission in a writing that is unable to generally pay its debts as they become due;
(g) the institution, by the Defaulting Party, of a general assignment for the benefit of its creditors; or
(h) the application for, consent to, or acquiescence to, by the Defaulting Party, the appointment of a receiver, custodian, trustee, liquidator, or similar official for all or a substantial portion of its assets.”
(c) Section 22.2(b) is amended by inserting “and is continuing” after “Event of Default occurs” in the first line thereof and deleting the second sentence therein. (d) Section 22.3(c) is amended by deleting the third sentence thereof and replacing it with the following: “If the Non- Defaulting Party’s aggregate G ains exceed its aggregate Losses and Costs, if any, resulting from the termination of this 16 Agreement or a Confirmation, the Termination Payment for all such Terminated Transactions shall be zero, notwithstanding any provision in this Section or Agreement to the contrary.”
(e) In Section 22.3(e), delete the entire provision (including subsections) and replace it with the following: “[Intentionally omitted]”
(f) In Section 22.3(f), delete the entire provision and replace it with the following:
“If the Defaulting Party disagrees with the calculation of the Termination Payment and the Parties cannot otherwise resolve their differences, and provided that the Defaulting Party has paid the undisputed part of the Termination Payment to the Non-Defaulting Party as provided under Section 22.3(c), and that any amounts disputed by the Defaulting Party are disputed in good faith, then the Defaulting Party may submit the calculation issue to Dispute Resolution pursuant to Section

34.”
(g) Section 28.1 is applicable and the Parties shall net monthly payments in accordance with Exhibit A of the WSPP. Both Parties intend for the netting provisions of Exhibit A to the WSPP Agreement to be effective on the Confirmation Effective Date.
(h) Section 30.1(4) is amended by inserting “or requested” after the word “required” and by adding the following at the end of the first sentence: “; or (8) to the Party’s and such Party’s affiliates’ lenders, counsel, accountants, advisors and agents who have a need to know such information and have agreed to keep such terms confidential”.
(i) Subsections 34.1 and 34.2 are deleted and replaced with the following:
“34.1 INFORMAL DISPUTE RESOLUTION
IN THE

EVENT OF ANY CLAIM, CONTROVERSY OR DISPUTE

BETWEEN THE PARTIES ARIS ING OUT OF OR RELATING TO OR IN

CONNECTION WITH THIS AGREEMENT, ANY PARTY MAY DELIVER TO

THE OTHER PARTIES NOTICE OF THE DISPUTE WITH A DETAILED

DESCRIPTION OF THE UNDERLYING CIRCUMSTANCES OF SUCH
DISPUTE (A “DISPUTE NOTICE”). THE SENIOR OFFICERS OF THE

PARTIES SHALL MEET AND CONFER AS OFTEN AS THEY DEEM
REASONABLY NECESSARY DURING THE THIRTY (30) DAY PERIOD

FOLLOWING RECEIPT OF THE DISPUTE NOTICE IN GOOD FAITH

NEGOTIATIONS TO RESOLVE THE DISPUTE TO THE SATISFACTION OF EACH PARTY. IN THE EVENT A DISPUTE IS NOT RESOLVED BY THE EXPIRATION OF THE THIRTY (30) DAY PERIOD, THEN A PARTY MAY

PURSUE ANY LEGAL REMEDY AVAILABLE TO IT IN ACCORDANCE
WITH THIS AGREEMENT.”
“34.2 EXCL

USIVE JURISDICTION
17 EACH PARTY SUBMITS TO THE EXCLUSIVE JURISDICTION OF

THE STATE OR FEDERAL COURTS LOCATED IN LOS ANGELES ,

CALIFORNIA, FOR ANY ACTION OR PROCEEDING RELATING TO THIS

AGREEMENT OR ANY TRANSACTION, AND EXPRESSLY WAIVES ANY

OBJECTION IT MAY HAVE TO SUCH JURISDICTION OR THE
CONVENIENCE OF SUCH FORUM.”
(j) The phrase “arbitration or” is deleted from the first line of Section 34.4. (k) The following shall be inserted as a new Section 34.5:
“34.5 LIMITATION OF DAMAGES. EXCEPT AS OTHERWISE SPECIFIED

IN ANY CONFIRMATION, FOR BREACH OF ANY PROVISION OF THIS

CONFIRMATION AGREEMENT FOR WHICH AN EXPRESS REMEDY OR

MEASURE OF DAMAGES IS PROVIDED, THE EXPRESS REMEDY OR

MEASURE OF DAMAGES PROVIDED IS THE SOLE AND EXCLUSIVE

REMEDY UNDER THIS AGREEMENT AND THE AGREEMENT FOR THE

BREACH, LIABILITY FOR THE BREACH IS LIMITED AS SET FORTH IN

THE PROVISION AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. EXCEPT AS OTHERWISE SPECIFIED IN

ANY CONFIRMATION, IF NO EXPRESS REMEDY OR MEASURE OF

DAMAGES IS PROVIDED IN THIS AGREEMENT FOR A PARTICULAR

BREACH, LIABILITY FOR THE BREACH IS LIMITED TO DIRECT

DAMAGES ONLY, THE DIRECT DAMAGES ARE THE SOLE AND

EXCLUSIVE REMEDY UNDER THIS AGREEMENT FOR THE BREACH,

AND ALL OTHER REMEDIES FOR DAMAGES AT LAW OR IN EQUITY
ARE WAIVED. EXCEPT AS OTHERWISE SPECIFIED IN ANY

CONFIRMATION, NEITHER PARTY IS LIABLE FOR ANY OTHER TYPE OF

DAMAGE, INCLUDING INCIDENTAL, PUNITIVE, EXEMPLARY,

CONSEQUENTIAL, SPECIAL OR INDIRECT DAMAGES OF ANY NATURE (INCLUDING DAMAGES ASSOCIATED WITH LOST PROFITS, BUSINESS

INTERRUPTION AND LOSS OF GOODWILL) ARISING AT ANY TIME,

WHETHER IN TORT (INCLUDING THE SOLE OR CONTRIBUTORY

NEGLIGENCE OF EITHER PARTY OR ANY RELATED PERSON),

WARRANTY, STRICT LIABILITY, CONTRACT OR STATUTE, UNDER
ANY INDEMNITY PROVISION, OR OTHERWISE.”
(l) Section 37 is amended by inserting the following in the beginning of the section:
“On the date of entering into this Confirmation,”.
(m) Section 41 “Witness” shall become Section 42 and the following “Standard of Review” Section shall be substituted in its place:
“The Parties agree as follows:

From the date of entering into a Transaction under this Agreement and throughout the term of such Transaction, the Parties each warrant and covenant as follows:
18 (i) Absent the agreement of all Parties to the proposed change, the standard of review for changes to any section of this Agreement (including all Transactions and/or Confirmations) specifying the rate(s) or other material economic terms and conditions agreed to by the Parties herein, whether proposed by a Party, a non- party or FERC acting sua sponte, shall be the “public interest” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956)( the “Mobile- Sierra” doctrine) and clarified in Morgan Stanley Capital Group, Inc. v.

Public Util. Dist. No. 1 of Snohomish 554 U.S. 527 (2008) and NRG Power Marketing LLC v. Maine Pub. Util. Comm’n, 558 U.S. 165 (2010). (ii) The Parties, for themselves and their successors and as signs, (i) agree that this “public interest” standard shall apply to any proposed changes in any other documents, instruments or other agreements executed or entered into by the Parties in connection with this Agreement and (ii) hereby expressly and irrevocably waive any rights they can or may have to the application of any other standard of review, including the “just and reasonable” standard.”

6.12 Counterparts

This Confirmation may be signed in any number of counterparts with the same effect as if the signatures to the counterparts were upon a single instrument. The Parties may rely on electronic, or scanned signatures as originals under this Confirmation. Delivery of an executed signature page of this Confirmation by electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.

6.13 Entire Agreement; No Oral Agreements or Modifications

This Confirmation sets forth the terms of the Transaction into which the Parties have entered and shall constitute the entire agreement between the Parties relating to the contemplated purchase and sale of the Product. Notwithstanding any other provision of the Agreement, this Transaction may be confirmed only through a Documentary Writing executed by both Parties, and no amendment or modification to this Transaction shall be enforceable except through a Documentary Writing executed by both Parties.

[Signatures appear on the following page.]

AGREED AS OF THE EFFECTIVE DATE:

19 California Choice Energy Authority, a
California joint powers authority

By:

Printed Name:

Title:

Acknowledged by Member:

City of Lancaster, a California municipal
corporation and charter city

By:

Printed Name:

Title:

Resi Station, LLC, a Delaware limited
liability company

By:

Printed Name:

Title:

Appendix A - 1

APPENDIX A

DEFINED TERMS

“Alternate Cap acity” means replacement Product which Seller has elected to provide to Purchaser in accordance with the terms of Section 2.3.

“CAISO” me
ans the California Independent System Operator Corporation or the successor organization to the functions thereof.

“Capacity Attributes” me
ans attributes of the Shown Unit that may be counted toward Compliance Obligations, including: flexibility, dispatchability, physical location or point of electrical interconnection of the Shown Unit; the Shown Unit’s ability to generate at a given capacity level, reduce energy demand, provide ancillary services, or ramp up or down at a given rate; any current or future defined characteristics, certificates, tags, credits, or accounting constructs of the Shown Unit, howsoever entitled, identified from time to time by the CAISO or a Governmental Body having jurisdiction over Compliance Obligations.

“Capacity Replacement Price” means (a) t
he price actually paid for any Replacement Capacity
purchased by Purchaser, plus costs reasonably incurred by Purchaser in purchasing such Replacement Capacity, or (b) absent a purchase of any Replacement Capacity, the market price for such Resource Adequacy Capacity multiplied by the amount of RA Shortfall Amount neither provided by Seller nor purchased by Purchaser as Replacement Capacity. The Purchaser shall determine such market prices in a commercially reasonable manner.

“Change in Tax Law”
means (a) (i) any change in or amendment to the Code or another applicable federal income tax statute; (ii) any change in, or issuance of, or promulgation of any temporary or final regulations by the U.S. Department of the Treasury that would result in any change to the interpretation of the Tax Code or existing temporary or final regulations promulgated by the U.S.

Department of the Treasury; (iii) any IRS guidance published in the Internal Revenue Bulletin and/or Cumulative Bulletin, notice, announcement, revenue ruling, revenue procedure, technical advice memorandum, examination directive or similar authority issued by the IRS Large Business and International division, or any published advice, advisory, or legal memorandum issued by IRS Chief Counsel, that applies, advances or articulates a new or different interpretation or analysis of any provision of the Code, any other applicable federal tax statute or any temporary or final Treasury Regulation promulgated thereunder; or (iv) any change in the interpretation of any of the authorities described in clauses (a)(i) through (iii) by a decision of the U.S. Tax Court, the U.S.

Court of Federal Claims, a U.S. District Court, a U.S. Court of Appeals or the U.S. Supreme Court, that applies, advances or articulates a new or different interpretation or analysis of federal income tax law, and (b) in the case of (a)(i) through (iv), such change or new or different interpretation, as applicable, occurs between the Execution Date and before the end of the Congress in session when the Initial Delivery Date occurs.

“CIRA Tool” means
the CAISO Customer Interface for Resource Adequacy.

“Compliance Expenditure Cap” has the meaning set forth in Section 6.5.

Appendix A - 2
“Compliance Obligations” means, as applicable, RAR, Local RAR and FCR.

“Compliance Showings ” mean s the applicable LSE ’s compliance with the r esource adequacy requirements of the CPUC for an applicable Showing Month.

“Contingent Firm RA Product” has the meaning set forth in Article 1 herein.

“Contract Quantity” h
as the meaning set forth in Appendix B.

“CPUC” means the California Public Utilities Commission.

“CPUC Decisions” means any cur
rently effective or future decisions, resolutions, or rulings related to resource adequacy.

“CPUC Filing Guide” is the document issued annually by the CPUC which sets forth the guidelines, requirements and instructions for load serving entities to demonstrate compliance with the CPUC’s resource adequacy program.

“Effective Flexible Capacity” ha
s the meaning given in CAISO’s FERC-approved Tariff.

“Environmental Costs” mean
s (i) costs incurred in connection with acquiring and maintaining all environmental permits and licenses for the Product, (ii) the Product’s compliance with all applicable environmental laws, rules , and regulations, including capital costs for pollution mitigation or installation of emissions control equipment required to permit or license the Product, (iii) all operating and maintenance costs for operation of pollution mitigation or control equipment, (iv) costs of permit maintenance fees and emission fees as applicable, (v) the costs of all emission reductions that have been authorized by a local air pollution control district or emissions trading credits or units pursuant to the California Health & Safety Code, market based incentive programs such as the South Coast Air Quality Management District’s Regional Clean Air Incentives Market, authorizations to emit sulfur dioxide and oxides of nitrogen by the Environmental Protection Agency, and any costs related to greenhouse gas emissions required by any applicable environmental laws, rules, regulations, or permits to operate, and (vi) costs associated with the disposal, clean-up, decontamination or remediation, on or off site, of hazardous substances.

“Expected Contract Q
uantity” means, with respect to any Showing Month of the Delivery Period, (a) the Contract Quantity of Product less the Transmission Loss Factor (TLF) credit and Planning Reserve Margin (PRM) credit for demand response resources (9% in 2022) pursuant to the 2022 RA Guide and D.21-06-029 if the Shown Unit or Alternate Capacity is a Proxy Demand Resource since these credits are added by CPUC staff to the Monthly Supply Plan values entered into CIRA by the LSE, or (b) the Contract Quantity of Product for such Showing Month, including the amount of Contract Quantity of Product that Seller has elected to provide Alternate Capacity.

“FCR” means the f l
exible capacity requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, the CAISO pursuant to the Tariff, or other Governmental Body having jurisdiction over Compliance Obligations and includes any non- binding advisory showing which an LSE is required to make with respect to flexible capacity.

Appendix A - 3
“FCR Attributes” means, with respect to a Shown Unit , any and all resource adequacy attributes of the Shown U nit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s FCR.

“Firm RA Product” has t he meaning set forth in Article 1 herein.

“Flexible Capacity Category” shall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.

“Force Majeure Event” h
as the meaning set forth in Section 5.1.

“Governmental Body” means any
federal, state, local, municipal or other government; any governmental, regulatory or administrative agency, commission or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; and any court or governmental tribunal.

“Initia
l Delivery Date” means the first day of the first Showing Month of the Delivery Period for which the Product is delivered hereunder.

“Interest Rate” means , f
or any date, the lesser of (a) the per annum rate of interest equal to the prime lending rate as may from time to time be published in The Wall Street Journal under “Money Rates” on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) and (b) the maximum rate permitted by applicable law.

“Local RAR” means the local resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations.

“Local RAR Attributes ” m
eans, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s Local RAR.

“LSE” means “Load S
erving Entity” as such term is used in Section 40.9 of the Tariff.

“MW” means megawatt.

“Net Qualifying Capacity” ha
s the meaning given in CAISO’s FERC-approved Tariff.

“Notification Deadline ” is twenty (20) Business Days before the relevant deadlines for the corresponding Compliance Showings applicable to the relevant Showing Month.

“Planned Outage” means, subject to and as further described in the CPUC Decisions, a CAISO - approved, planned or scheduled disconnection, separation or reduction in capacity of the Unit

Appendix A - 4
that is conducted for the purposes of carrying out routine repair or maintenance of such Unit, or for the purposes of new construction work for such Unit.

“Product” means RAR Attributes, Local RAR Attributes and FCR Attributes, each for the Delivery Period, Unit, Contract Quantity, Contract Price and other specifications contained in Appendix B.

“Prorated Percentage of Unit Factor” means the percentage, as specified in Appendix B , of the
Unit NQC as of the Effective Date that is dedicated to Purchaser under this Transaction.

“Prorated Percentage of Unit Flexible Factor” means the percentage, as specified in Appendix B, of the Unit EFC as of the Effective Date that is dedicated to Purchaser under this Transaction.

“Proxy Demand Resource” or “
PDR” has the meaning set forth in the Tariff.

“Prudent Operating Practice” means (a) the applicable practices, methods and acts required by or consistent with applicable laws and reliability criteria, and otherwise engaged in or approved by a significant portion of the electric power industry during the relevant time period in the Western United States, or (b) any of the practices, methods and acts which, in the exercise of reasonable judgment in light of the facts known at the time the decision was made, could have been expected to accomplish the desired result at a reasonable cost consistent with good business practices, reliability, safety and expedition. Prudent Operating Practice is not intended to be limited to the optimum practice, method or act to the exclusion of all others, but rather to acceptable pra ctices, methods or acts generally accepted in the electric power industry in the Western United States.

“RAR Attributes” me
ans, with respect to a Shown Unit, any and all resource adequacy attributes of the Shown Unit, as may be identified from time to time by the CPUC, CAISO, or other Governmental Body having jurisdiction over Compliance Obligations, that can be counted toward an LSE’s RAR.

“RA Shortfall Amount” means the difference, expressed in kW, of (a) the Contract Quantity for such month, minus (b) the Net Qualifying Capacity of the Facility for such month, including any adjustments, able to be shown on Purchaser’s monthly or annual Resource Adequacy Plan (as defined in the CAISO Tariff) to the CAISO and CPUC and counted as Resource Adequacy Capacity (as defined in the CAISO Tariff).

“Replacement Capacity ” m
eans the Resource Adequacy Capacity purchased by Purchaser to replace the RA Shortfall Amount.

“Replacement RA” m
eans Resource Adequacy Benefits, if any, equivalent to those that would have been provided by the Facility with respect to the applicable Showing Month in which a RA Deficiency Amount is due to Purchaser.

“Replacement Uni
t” has the meaning set forth in Section 2.3.

“Resource Adequacy Requirements ” or “RAR” means the resource adequacy requirements established for LSEs by the CPUC pursuant to the CPUC Decisions, by CAISO pursuant to the

Appendix A - 5
Tariff, or by any other Governmental Body having jurisdiction over Compliance Obligations, not including Local RAR or FCR.

“Resource Category” s
hall be as described in the annual CPUC Filing Guide, as such may be modified, amended, supplemented or updated from time to time.

“SC” means Scheduling Coordinator as defined in the Tariff.

“Showing Month” means the
calendar month of the Delivery Period that is the subject of the related Compliance Showing.

“Shown Unit” means
any Unit, or any Replacement Unit meeting the requirements of Section 2.3 of this Confirmation and specified by Seller in a Supply Plan, but not necessarily identified by Seller to Purchaser on the Effective Date.

“Subsequent Purchaser” me
ans the purchaser of Product from Purchaser in a re-sale of Product by Purchaser.

“Substitute Capacity” ha
s the meaning set forth in the Tariff for “RA Substitute Capacity”.

“Tax Benefits” m
eans any state, local and/or federal tax benefit or incentive, including energy credits determined under Section 45 or 48 of the Internal Revenue Code of 1986, as amended, investment tax credits, production tax credits, depreciation, amortization, deduction, expense, exemption, preferential rate, and/or other tax benefit or incentive associated with the operation of, construction, investments in or ownership of the Facility (including any cash payment or grant).

“Tariff” means the CAISO T
ariff, Business Practice Manuals , Operating Agreements, and Operating Procedures, including the rules, protocols, procedures and standards attached thereto, as the same may be amended or modified from time to time and approved by FERC, if applicable.

“Unit” means
the resource described in Appendix B , as may be modified by Seller from time to time after the Effective Date to remove and/or replace Units with Replacement Units . A Unit or Shown Unit may not be a coal-fired generating facility.

“Unit EFC” me
ans the lesser of the Unit’s Effective Flexible Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination.

“Unit NQC” mean
s the lesser of the Unit ’s Net Qualifying Capacity as set by CAISO as of the Effective Date and that of the Unit on a subsequent date of determination.

Appendix B - 1

APPENDIX B

PRODUCT AND UNIT INFORMATION

Product:

RAR Local RAR Flexible Capacity

and all Capacity Attributes related to such Product.

Additional Product Information (fill in all that apply):

CAISO Zone: System
Resource Category (MCC Bucket): DR
CPUC Local Area (if applicable): N/A
Flexible Capacity Category (if applicable): N/A

Delivery Period: January 1, 2023 through December 31, 2032, inclusive.

Contract Quantity and Contract Price:

RAR and Local RAR, as applicable

CONTRACT QUANTITY AND CONTRACT PRICE

Appendix B - 2

Appendix B - 3

Development Security and Performance Security

Development Security: of the Contract Quantity for the September Showing Month.

Performance Security: of the Contract Quantity for the September Showing Month.

Appendix C - 2

Defaults:

Attn: John Anderson
Phone: (415) 697-1271
Facsimile: (650) 745-4847
Email: [email protected]

Additional notices of an Event of Default
to:

Attn: Nora Xu
Email: [email protected]
Defaults:

Allison Burns, City Attorney
44933 Fern Avenue
Lancaster, CA 93534
Phone: (949) 725-4187
Email: [email protected]

With a copy to:

Hall Energy Law PC
Attn: Stephen Hall
Phone: (503) 313-0755
Email: [email protected]

1 Tuesday, May 3, 2022

CALL TO ORDER
Mayor Parris called the meeting of the Lancaster City Council/Successor Agency/Financing/Power/California Choice Energy Authority to order at 5:06 p.m.

ROLL CALL
PRESENT: City Council Members / Agency Directors / Authority Members: Dorris, Malhi, Mann, Vice Mayor/Vice Chairman Crist, Mayor/Chairman Parris STAFF MEMBERS: City Manager/Executive Director; Deputy City Manager/Deputy Executive Director; City Attorney/Agency/Authority Counsel; City Clerk/Agency/Authority Secretary; Assistant to the City Manager; Development Services Director; Parks, Recreation and Arts Director; Finance & Technology Director.

INVOCATION
Ryan Crist

PLEDGE OF ALLEGIANCE
Council Member Malhi

PRESENTATION TO THE CITY

1. OFFICIAL CANVASS AND CERTIFICATION OF THE APRIL 12, 2022

GENERAL MUNICIPAL ELECTION
The City Clerk presented the staff report on this item.

CC 2
05/24/2022
JC
2 On a motion by Council Member Mann and seconded by Council Member Dorris, the City Council adopted Resolution No. 22-16, reciting the facts of the General Municipal Election held on April 12, 2022, declaring the results and such other matters as provided by the law regarding the election of two Council Members and Measure H, an advisory measure without binding the city, would advise the City Council as to whether it should adopt an ordinance imposing an administrative fine for loitering or camping within 500 feet of sensitive use such as schools, churches, daycares, parks and libraries, by the following vote: 5-0-0-0; Ayes: Dorris, Malhi, Mann, Crist, Parris; Noes: None; Abstain:

None; Absent: None
The Oath of Office was administered at this time.

Mayor Parris requested a recess at this time.

Mayor Parris reconvened the meeting at 5:19 p.m.

CA1. CONSIDERATION OF NOMINATION AND APPOINTMENT OF SHAWN CANNON II AS DEPUTY MAYOR.

On a motion by Mayor Parris and seconded by Vice Mayor Crist, City Council approved then nomination and appointment of Shawn Cannon II as Deputy Mayor, by the following vote: 5-0-0-0; Ayes: Dorris, Malhi, Mann, Crist, Parris; Noes: None; Abstain:

None; Absent: None
The Oath of Office was administered at this time.

ED 1. RESOLUTION CONFIRMING THE EXISTENCE OF A LOCAL EMERGENCY Jason Caudle, City Manager presented the staff report on this item.

On a motion by Vice Mayor Crist and seconded by Council Member Mann, the City Council ADOPTED Resolution No. 22-17, a resolution of the City Council of the City of Lancaster, California, confirming the continued existence of a local emergency in the City of Lancaster, California, by the following vote: 5-0-0-0; Ayes: Dorris, Malhi, Mann, Crist, Parris; Noes: None; Abstain: None; Absent: None

CONSENT CALENDAR
On a motion by Vice Mayor Crist and seconded by Council Member Mann, the City Council APPROVED the Consent Calendar as, by the following vote: 5-0-0-0; Ayes:

Dorris, Malhi, Mann, Crist; Parris; Noes: None; Abstain: None; Absent: None CC 1. ORDINANCE WAIVER
3 Waived further reading of any proposed ordinances. (This permits reading the title only in lieu of reciting the entire text.)
CC 2. MINUTES
Approved the City Council/Successor Agency/Financing/Power/California Choice Energy Authority Regular Meeting Minutes of March 22, 2022.

CC 3. CHECK REGISTERS – MARCH 6, 2022 THROUGH APRIL 16, 2022 Approved the Check and Wire Registers for March 6, 2022 through April 16, 2022 in the amount of $16,627,333.62 as presented.

CC 4. MONTHLY REPORT OF INVESTMENTS – MARCH 2022
Accepted and approved the March 2022 Monthly Report of Investments as submitted.

CC 5. ADDITIONAL AUTHORIZATION NO. 2 TO MULTI-YEAR TRAFFIC

ENGINEERING, PLANNING, AND RELATED PROFESSIONAL SERVICES (SERVICE GROUP CATEGORY 2 – STRATEGIC TRANSPORTATION PLANNING)

FOR SAFE ROUTES TO SCHOOL MASTER PLAN REFRESH
Approved award of Additional Authorization No. 2 to with Redman Consulting, LLC, of West Linn, OR, for services, in accordance with the Multi-Year Traffic Engineering, Planning, and Related Professional Services Agreement, Service Group Category (SGC) 2 – Strategic Transportation Planning, to update the City’s Safe Routes to School Master Plan, in the amount of $50,690.00; and authorized the City Manager, or his designee, to sign all documents.

CC 6. PARCEL MAP APPROVAL – PARCEL MAP NO. 72532-02 (LOCATED ON THE SOUTHEAST CORNER OF 60TH STREET WEST AND AVENUE L)
Approved the map and accepted the dedications as offered on the map for Parcel Map No. 72532-02; made findings that this project will not violate any of the provisions of Sections 66473.5, 66474.1, and 66474.6 of the Subdivision Map Act; and instructed the City Clerk to endorse on the face of the map the certificate, which embodies the approval of said map and the dedications shown thereon.

CC 7. ACCEPTANCE OF PUBLIC WORKS CONSTRUCTION PROJECT NO. 21-003 – 2020 SUMMER PAVEMENT MANAGEMENT PROGRAM
Accepted the work constructed by Granite Construction Company, for Public Works Construction Project No. 21-003, 2020 Summer Pavement Management Program, and directed the City Clerk to file the Notice of Completion for the project. Retention on this project shall be disbursed in accordance with California Contract Code.

CC 8. ACCEPTANCE OF PUBLIC WORKS CONSTRUCTION PROJECT NO. 21-007 – 2020 FALL PAVEMENT MANAGEMENT PROGRAM
Accepted the work constructed by C.A. Rasmussen, Inc., for Public Works Construction Project No. 21-007, 2020 Fall Pavement Management Program, and directed the City Clerk to file the Notice of Completion for the project. Retention on this project shall be disbursed in accordance with California Contract Code.
4 CC 9. ACCEPTANCE OF PUBLIC WORKS CONSTRUCTION PROJECT NO. 21-018 –

TRAFFIC CALMING

1. Approved Change Order No. 1 and increased the total amount of the contract with Cal Stripe, Inc., of Colton, California, for Public Works Construction Project No. 21-018, Traffic Calming, by $14,747.83, for a total revised contract amount of $140,947.83, plus 15% contingency.

2. Accepted the work constructed by Cal Stripe, Inc., for Public Works Construction Project No. 21-018, Traffic Calming and directed the City Clerk to file the Notice of Completion for the project. Retention on this project shall be disbursed in accordance with California Contract Code.

CC 10.VACATION AND ABANDONMENT OF A DRAINAGE EASEMENT OVER LOT 11 OF TRACT MAP 44439 LOCATED AT THE SOUTHWEST CORNER OF AVENUE L-12 AND JENNY LANE
Adopted Resolution No. 22-14, declaring its intention to summarily vacate and abandon a Drainage Easement over Lot 11 of Tract Map 44439 located at the Southwest corner of Avenue L-12 and Jenny Lane.

CC 11.ADDITIONAL AUTHORIZATION NO. 2 TO PROFESSIONAL SERVICES

AGREEMENT FOR ADDITIONAL WORK - HOUSING ELEMENT
IMPLEMENTATION (RFQ 721-19)

1. Recognized reimbursable grant fund revenue from the California Department of Housing and Community Development (HCD) Senate Bill 2 Planning Grants Program in the amount of $209,775.00 into account number 349-3700-001, and appropriated the same amount to expenditure account number 349-4770-770; and,

2. Approved award of Additional Authorization No 2. to Moore Iacofano Goltsman, Inc., (MIG) of Pasadena, California, to amend the Professional Services Agreement in the amount of $209,775.00 to include Housing Element implementation; and authorized the City Manager, or his designee, to sign all documents.

CC 12.TASK ORDER FOR MULTI-YEAR PROFESSIONAL SERVICES (SERVICE GROUP CATEGORY 4 – ENVIRONMENTAL SERVICES) PREPARATION OF THE

EASTSIDE OVERLAY AND ENVIRONMENTAL IMPACT REPORT

Approved Task Order No. 3 with Michael Baker International, Inc., for services in accordance with the 2018-2020 Multi-Year Professional Services Agreement, Service Group Category 4 – Environmental Services for the Eastside Overlay Environmental Impact Report in the amount of $421,945.00. Authorized the City Manager, or his designee, to sign all documents.

CC 13. 2023 PETERSEN INDUSTRIES TL-3 LIGHTNING LOADER ACQUISITION 5 1. Approved the purchase of one (1) 2023 Petersen Industries TL-3 Lightning Loader, utilizing Sourcewell Cooperative Purchasing Contract awarded to Petersen Industries via authorized dealer Nixon-Egli Equipment Co.

2. Authorized the City Manager, or his designee, to sign all documents and approve up to 15% price fluctuation due to vehicle availability at time of order.

CC 14.APPROVAL OF A SERVICE CONTRACT AND SOFTWARE MAINTENANCE

AGREEMENT AND TECHNICAL AGREEMENT WITH SERIOUS CONTROLS LLC

FOR THE DEVELOPMENT, AND ONGOING MAINTENANCE OF A DEMAND

ENERGY RESPONSE MANAGEMENT SYSTEM

1. Approved a Service Contract with Serious Controls LLC for the development and deployment of a Demand Energy Response Management System.

2. Approved a Software Maintenance and Technical Agreement with Serious Controls LLC for maintenance of the Demand Energy Response Management System.

3. Authorized the City Manager to execute all documents and make any non-substantive changes necessary to complete the transaction.

CC 15.APPROVAL OF POWER CHARGE INDIFFERENCE ADJUSTMENT

VOLUNTARY ALLOCATION OF LONG-TERM RENEWABLE ENERGY

PORTFOLIO FROM SOUTHERN CALIFORNIA EDISON AND AUTHORIZATION

TO EXECUTE THE VOLUNTARY ALLOCATION AGREEMENT ON BEHALF OF

LANCASTER CHOICE ENERGY
Approved the Power Charge Indifference Adjustment (PCIA) Voluntary Allocation of Long-Term Renewable Energy Portfolio from Southern California Edison (SCE) and Authorized the City Manager to Execute the Voluntary Allocation Agreement on behalf of Lancaster Choice Energy.

CC 16.RESOLUTION OF INTENTION TO RENEW THE LANCASTER TOURISM

BUSINESS IMPROVEMENT DISTRICT
Adopted Resolution No. 22-15, declaring the City Council’s intention to renew the Lancaster Tourism Business Improvement District (TBID) and establishing the time and place of a public meeting and a public hearing thereon and giving notice hereof.

CC 17.RENEWAL OF GENERAL SERVICES AGREEMENT WITH LOS ANGELES COUNTY
Renewed the General Services Agreement between the City of Lancaster and the County of Los Angeles for a period of five years.

CC 18.AWARD RFP 763-22 OUTLOOK MAGAZINE PRINT VENDOR CONTRACT Awarded RFP 763-22, Outlook Magazine Print Vendor Contract, to Advanced Printing & Graphics of Lancaster, California, in the amount of $485,210.25 to print nine editions of 6 the OUTLOOK Magazine. Authorized the City Manager, or his designee, to sign all documents.

PH 1. ADOPTION OF THE CITY OF LANCASTER’S COMMUNITY

DEVELOPMENT BLOCK GRANT PROGRAM (CDBG) AND HOME INVESTMENT PARTNERSHIP PROGRAM (HOME) 2022-2023 PROGRAM YEAR (PY) ACTION PLAN
Mayor Parris opened the public hearing.

Nike Noack, Senior Manager-Finance presented the staff report on this item.

Mayor Parris closed the public hearing at this time.

On a motion by Vice Mayor Crist and seconded by Council Member Malhi the City Council approved item number PH 1 as comprised, by the following vote: 5-0-0-0; Ayes:

Dorris, Malhi, Mann, Crist, Parris; Noes: None; Abstain: None; Absent: None Recommendation(s):
a. Approved and adopted the CDBG and HOME Action Plan for the 2022-2023 PY to be submitted to the United States Department of Housing and Urban Development (HUD). b. Appropriated approximately $1,572,221 from PY 2022-2023 CDBG Funds. c. Appropriated approximately $676,132 from PY 2022-2023 HOME Funds. d. Provided City Staff with a methodology for distributing funds should the City’s 2022- 2023 CDBG and HOME annual allocations increase or decrease. e. Authorized the City Manager or designee to execute all contracts and associated documents, including subrecipient agreements, subject to City Attorney approval.

CR 1. COUNCIL REPORTS
Vice Mayor Crist reported on the Antelope Valley Transit Authority (AVTA) citing receipt of award from Environmental Protection Agency (EPA) and Federal Transit Administration (FTA) as number one transportation agency in North America.

Vice Mayor Crist also reported on the North Coalition Transit Commission (NCTC) meeting regarding 138/14 freeway repairs.

Mayor Parris directed staff to draft a proclamation for the next meeting declaring a public safety hazard.

Council Member Dorris reported on concerns regarding Los Angeles County Sheriff Deputy staffing. He also announced upcoming Mayor’s Prayer event scheduled for May 5, 2022 at 7:00 a.m.

LANCASTER FINANCING AUTHORITY
No action is required at this time.
7 LANCASTER POWER AUTHORITY
No action is required at this time

LANCASTER SUCCESSOR AGENCY
No action is required at this time

LANCASTER HOUSING AUTHORITY
No action is required at this time

CALIFONRIA CHOICE ENERGY AUTHORITY
No action is required at this time

CITY MANAGER / EXECUTIVE DIRECTOR ANNOUNCEMENTS
Jason Caudle, City Manager provided a video report on the Poppy Festival held April 22 through April 24th. The City Manager also announced upcoming events to include continuance of Monday Night Bitez; Skytower Mural; Mayor’s partnership with Choshu Japanese Government, and MOAH events. The City Manager also provided video recaps of the Future of the City event and Ribbon Cutting at the Lancaster Community Center.

CITY CLERK/AGENCY/AUTHORITY SECRETARY ANNOUNCEMENT
The City Clerk provided the public with the procedure to address the City Council/Successor Agency/Authority regarding non-agendized items.

PUBLIC BUSINESS FROM THE FLOOR - NON-AGENDIZED ITEMS
Addressing the Council at this time:

Steve McCormich -spoke regarding neighborhood safety concerns.

Keith Cone- spoke regarding neighborhood safety concerns.

Fran Sereseres-thanked Mayor and Council for their work.

Gordan Jefferson- spoke in opposition against Measure H.

COUNCIL/AUTHORITY COMMENTS
No comments at this time.

CLOSED SESSION
Allison Burns, City Attorney announced Council will now move to closed session to discuss items number one (1) through twenty-seven (27).

Council moved into closed session at 6:22 pm.
8 Mayor Parris reconvened the meeting at 6:34 p.m.

Allison Burns, City Attorney reported that Council discussed closed session items number fifteen (15), sixteen (16), and seventeen (17). Council gave direction to staff and Council. Council authorized legal counsel to file an appeal regarding item number fifteen (15). No reportable action.

1. Conference with Legal Counsel - Anticipated Litigation: significant exposure to litigation pursuant to Government Code Section 54956.9(d) (2) - two potential cases.

2. Conference with Legal Counsel - Anticipated Litigation: consideration of initiation of litigation pursuant to Government Code Section 54956.9(d) (4) - two potential cases.

3. Antelope Valley Groundwater Cases Included Action:

Los Angeles County Waterworks District No. 40 v. Diamond Farming Co. Superior Court of California, County of Los Angeles, Case No. BC325201; Los Angeles County Waterworks District No. 40 v. Diamond Farming Co. Superior Court of California, County of Kern, Case No. S-1500-CV-254-348; Wm. Bolthouse Farms, Inc. v. City of Lancaster, Diamond Farming Co. v. City of Lancaster Diamond Farming Co. v. Palmdale Water District Superior Court of California County of Riverside, consolidated actions; Case Nos. RIC 353 840, RIC 344 436, RIC 344 668

4. Ramos v Patino, LASC Case No. MC027974

5. Lozoya v. City of Lancaster, LASC Case No. 19AVCV00714

6. Johnson v. City of Lancaster, LASC Case No. 19AVCV00824

7. Rahier v. City of Lancaster, LASC Case No. 19AVCV00163

8. Brisa Mahoney, et al. v. City of Lancaster, et al., LASC Case No. 2OSTCV02556

9. Conference with Real Property Negotiators:

Property: APNs 3124-012-008&009
City negotiators: Mike Livingston, Allison Burns
Negotiating parties: Ann Hiramoto; Tina Yoke
Under negotiation: price and terms of payment

10. Manzo v. Beazer Homes Holdings, LLC et al., LASC Case No. 20AVCV00297

11. Hernandez v. County of Los Angeles, et al., LASC Case No. 20AVCV00318

12. Romines v. City of Lancaster, et al, LASC Case No. 20AVCV00345 9 13. Moujan v. City of Lancaster et al., LASC Case No. 20AVCV00205

14. Davis v. State of California, LASC Case No. 19AVCV00805

15. Lancaster v. Netflix, et al., LASC 21STCV01881

16. Butts v. Lancaster, LASC 21STCP00389

17. Lancaster v. Rives

18. Myesha Lopez, et al. v. County of Los Angeles, et al. CDCA Case No. 5:21-cv-00290- JGB(SHKx)

19. Ortiz v. Lancaster, LASC Case No. 21AVCV00001

20. Aijala v. Lancaster, LASC Case No. 21STCV07841

21. Gardner v. Dominoids, LASC Case No. 21AVCV00186

22. Evans v. Lancaster, LASC Case No. 21AVCV00145

23. Bojorquez v. Lancaster, LASC Case No. 20AVCV00894

24. Arkey v. Lancaster, LASC Case No.20AVCV00816

25. Perez v. Lancaster, LASC Case No. 20AVCV00589

26. Serrano v. Los Angeles County et al. LASC Case No. 21AVCV00562

27. Jackson v. RE Schultz Construction et al. LASC Case No. 21AVCV00863

ADJOURNMENT
Mayor Parris adjourned the meeting at 6:36 p.m. and stated the next meeting will be held on May 24, 2022 at 5:00 p.m.

PASSED, APPROVED and ADOPTED this 24th day of May 2022, by the following vote:

AYES:

NOES:

ABSTAIN:

ABSENT:

ATTEST: APPROVED:
__________________________ _____________________________ ANDREA ALEXANDER R. REX PARRIS

CITY CLERK MAYOR/CHAIRMAN

AGENCY/AUTHORITY SECRETARY
10 STATE OF CALIFORNIA }
COUNTY OF LOS ANGELES }ss
CITY OF LANCASTER }

CERTIFICATION OF MINUTES

CITY COUNCIL/SUCCESSOR AGENCY/FINANCING/POWER/CALIFORNIA CHOICE

ENERGY AUTHORITY
I, ___________________________, ___________________________ of the City of Lancaster, CA, do hereby certify that this is a true and correct copy of the original City Council/Successor Agency/Financing/ Power/California Choice Energy Authority Minutes, for which the original is on file in my office.

WITNESS MY HAND AND THE SEAL OF THE CITY OF LANCASTER, CA on this _______________ day of ______________________, ____________. (seal)
__________________________________

STAFF REPORT
City of Lancaster
Date: May 24, 2022
To: Mayor Parris and City Council Members
From: George N. Harris II, Finance Director
Subject:Check Registers – April 17, 2022 through May 7, 2022 Recommendation:

Approve the Check and Wire Registers for April 17, 2022 through May 7, 2022 in the amount of $3,765,767.19 as presented.

Fiscal Impact:
$3,765,767.19 as detailed in the Check Registers.

Background:

Check Nos.: 7425512-7425998 $ 3,091,846.87
ACH/Wire Check Nos.: 101011017-101011026 $ 673,920.32 $ 3,765,767.19
Voided Check No.: N/A
Voided ACH/Wire No.: N/A

GH:sp
CC 3
05/24/22
JC
Staff Report
Monthly Report of Investments
September 26, 2006

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Lancaster City CouncilMay 24, 2022

Lancaster City Council
May 24, 2022