HomeMy WebLinkAbout11 PURCHASE AND SALE AGREEMENT WITH MARINERS CHURCHDocusign Envelope ID: 47B48E94-1B62-4DDC-B7B6-D9C96DFBBOD2
REPORTAGENDA
S't
MEETING DATE
TO
FROM
SEPTEMBER 16, 2025
ALDO E. SCHINDLER, CITY MANAGER
Agenda Item
11
Reviewed:
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City Manager
Finance Director
BRIAN MONCRIEF, DEPUTY CITY MANAGER — REAL PROPERTY
SUBJECT: PURCHASE AND SALE AGREEMENT WITH MARINERS CHURCH
FOR APPROXIMATELY 3 ACRES OF DISPOSITION AREA 8 AT
TUSTIN LEGACY
Request for authorization to approve a Purchase and Sale Agreement between Mariners
Church and the City for the sale of approximately 3.324 acres of City -owned property located
within a portion of Disposition Area 8 at Tustin Legacy. The property is generally bounded by
Warner Avenue, future Veterans Way, and future John Johnson Way. The purpose of the
Purchase and Sale Agreement is to implement the Reuse Plan for Marine Corps Air Station
Tustin and the Specific Plan for Tustin Legacy through the development and maintenance of
property.
RECOMMENDATION:
1. Approve and authorize the City Manager to execute the Purchase and Sale Agreement
between Mariners Church and the City in the form attached hereto subject to any non -
substantive modifications as may be recommended by the City's special real estate
counsel or the City Attorney; and
2. Authorize the City Manager to take all actions and to approve and execute all other
agreements, attachments and documents necessary or appropriate to complete the
transaction.
FISCAL IMPACT:
The purchase price for the property is $4,000,000. In addition to the purchase price, Mariners
Church will pay to the City a Project Fair Share Contribution of $1,640,217.83 to fund backbone
infrastructure improvements at Tustin Legacy. The Project Fair Share Contribution will be
payable at closing or may be deferred until the earlier of 12 months after closing or when permits
are pulled for construction, and if deferred, will accrue interest at the Wall Street Journal Prime
Rate. Within three (3) days of the effective date of the Purchase and Sale Agreement, Mariners
Church will also submit a $100,000.00 deposit into escrow, which will be applicable to the
purchase price at the close of escrow. Each party will also be responsible for paying customary
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City Council Agenda Report
Mariners Church Purchase and Sale Agreement
September 16, 2025
Page 2
escrow and closing costs. Further, the City will not be required to pay any real estate
commissions for the broker representing Mariners Church.
The Property will be annexed into a future Zone 4 of the City Community Facilities District 2018-
01, which has been established to cover service costs at Tustin Legacy (such as police and fire;
recreation program services; maintenance of parks, streets, sidewalks and drainage facilities).
The Rate and Method of Apportionment specific to this transaction will require City Council
consideration and approval prior to the close of escrow. The negotiated rate will be $0.50 per
square foot of permitted building square footage. The rate will escalate annually based on a
maximum annual escalation of 2%.
CORRELATION TO THE STRATEGIC PLAN:
Execution of the Purchase and Sale Agreement contributes to the fulfillment of the City's
Strategic Plan Goal A: Economic and Neighborhood Development. Specifically, this item
implements Strategy 1, which is to develop critical phases of Tustin Legacy.
BACKGROUND AND DISCUSSION:
The subject City -owned property is approximately 3.324 acres and located within a portion
of Disposition Area 8 at Tustin Legacy (Assessor's Parcel Numbers: 430-481-13, 430-481-
14, and 430-481-15) (Property). The Property is located within Planning Areas 8, 13 and 14
of the Tustin Legacy Specific Plan which is designated as Mixed -Use Urban and allows for
"Church and other religious institution" uses as a conditionally permitted use. Mariners
Church will apply for a Conditional Use Permit (CUP), along with other required entitlements,
within 90 days after the Purchase and Sale Agreement (PSA) is mutually executed (Effective
Date).
The Property was previously declared "surplus" by the City Council through City Council
Resolution 21-49 and the City received a letter of compliance from the California Department
of Housing and Community Development (HCD) pursuant to the Surplus Land Act on June
15, 2022.
The PSA between the City and Mariners Church is structured as an "As -Is" sale transaction
with the Property being conveyed in its current condition and for a purchase price at fair
market value for the proposed religious facility use as supported by an independent
appraisal. The PSA also includes a detailed set of mutually agreed upon entitlement and
performance milestones that establish a clear timeline for Mariners Church to obtain all
required entitlement approvals and proceed to closing. These provisions are intended to
ensure accountability, maintain steady progress, and preserve the City's interests, while
allowing flexibility should unforeseen circumstances arise.
The PSA generally includes the following key provisions:
• Purchase Price: $4,000,000.00
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City Council Agenda Report
Mariners Church Purchase and Sale Agreement
September 16, 2025
Page 3
• Good Faith Deposit (applicable to purchase price): $100,000.00
• Backbone Infrastructure Fair Share Contribution: $1,640,217.83
• Due Diligence Period: 270 days from the Effective Date of the PSA.
• Use Restriction: Property will be restricted to religious facility purposes by a covenant
recorded against the Property.
• CUP Submittal Deadline: Mariners Church must submit a complete application for the
CUP and all other required entitlements within 90 days of the Effective Date of the
PSA.
• Entitlement Deadline: Mariners Church must obtain required approvals of all required
entitlements no later than September 30, 2026, subject to limited California
Environmental Quality Act (CEQA)-related time extensions. Failure to meet the
deadline within specific timeframes gives the City the right to exercise remedies under
the PSA.
• Closing: Closing shall occur at the earlier of 30 days after satisfaction of closing
conditions or the Entitlement Deadline (as extended, if applicable).
Pending required entitlement processing and approvals, as well as close of escrow,
construction is anticipated to begin in 2027.
EfSigned by:
S FCB22 F593C74F8__
Brian Moncrief
Deputy City Manager — Real Property
Attachments:
1. Location Map
2. Purchase and Sale Agreement between City of Tustin and Mariners Church
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PURCHASE AND SALE AGREEMENT AND JOINT ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this "Agreement") is made and entered into as of , 2025,
for reference purposes only, by and between CITY OF TUSTIN, a California municipal
corporation (the "City" or "Seller"), and MARINERS CHURCH, a California non-profit religious
corporation ("Buyer"), individually a "Party" and collectively the "Parties." The date upon
which both Buyer and Seller have executed this Agreement and delivered the same to one another,
shall hereinafter be referred to as the "Effective Date."
IN CONSIDERATION of the respective agreements hereinafter set forth, Seller and Buyer
hereby agree as follows:
1. Background.
(a) The sale of the Property to Buyer, pursuant to this Agreement, and the
fulfillment generally of this Agreement, are in the vital and best interests of the citizens of the City
of Tustin and the health, safety, and welfare of its residents, and are in accord with the public
purposes and provisions of applicable federal, state, and local laws and requirements.
(b) Surplus Land Act Compliance. Consistent with the requirements of Govt.
Code Sections 54220-54234 ("Surplus Land Act") and the California Department of Housing
and Community Development ("HCD"), issued Surplus Land Act Guidelines (collectively with
the Surplus Land Act, the "SLA Regulations"), on June 15, 2021, all the requirements under the
SLA Regulations for the purpose of disposing of the surplus land identified as the Property have
been met and Seller is permitted to proceed with the sale of the Property. Prior to Closing, to
comply with SLA Regulations, Seller shall cause to be recorded a covenant ("SLA Covenant")
against the Property that requires that if ten (10) or more residential units are developed thereon,
not less than fifteen percent (15%) of the total number of residential units developed on the
property shall be sold or rented at affordable housing cost, as defined in Section 50052.5 of the
California Health and Safety Code, or affordable rent, as defined in Section 50053 of the California
Health and Safety Code, to lower income households, as defined in Section 50079.5 of the
California Health and Safety Code. Any such rental units shall remain affordable to, and occupied
by, lower income households for a period of 55 years for rental housing and 45 years for ownership
housing. The initial occupants of all ownership units shall be lower income households, and the
units shall be subject to an equity sharing agreement consistent with the provisions of paragraph
(2) of subdivision (c) of 65915 of the California Government Code. Buyer acknowledges that
these requirements shall be restrictions running with the Property and shall be enforceable against
any owner who violates such restrictions and each successor -in -interest of the Property who
continues the violation by any of the entities described in subdivisions (a) to (f), inclusive, of
Section 54222.5 of the California Government Code.
2. Purchase and Sale of Property. Seller hereby agrees to sell and convey to Buyer,
and Buyer hereby agrees to purchase from Seller, subject to the terms and conditions set forth
herein, the following (collectively, the "Property"):
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(a) That certain unimproved vacant real property consisting of approximately
3.324 gross acres/144,793.44 gross square feet, located within a portion of Disposition Area 8 at
Tustin Legacy, in the City of Tustin, County of Orange, State of California, commonly referred to
as Assessor's Parcel Numbers 430-481-13, 430-481-14, and 430-481-15, all as more fully
described in Exhibit A-1 and depicted on Exhibit A-2 (the "Land"), excluding the following rights
and interests of the City which shall be reserved to the City in the Deed (as defined below):
(i) Any and all oil, oil rights, minerals, mineral rights, natural gas,
natural gas rights and other hydrocarbons by whatsoever name known, geothermal steam and all
products derived from any of the foregoing, that may be within or under the Property together with
the perpetual right of drilling, mining, exploring for and storing in and removing the same from
the Property or any other land, including the right to whipstock or directionally drill and mine from
lands other than the Property, oil or gas wells, tunnels and shafts into, through or across the
subsurface of the Property and to bottom such whipstocked or directionally drilled wells, tunnels
and shafts under and beneath or beyond the exterior limits thereof, and to re -drill, re -tunnel, equip,
maintain, repair, deepen and operate any such well or mines; but without, however, the right to
enter upon or use the surface of the Property in the exercise of such rights or otherwise adversely
affect the use or operation of the Property as anticipated by this Agreement or the structural
integrity of any improvements on the Property; and
(ii) Any and all water, water rights or interests therein appurtenant or
relating to the Property or owned or used by the City in connection with or with respect to the
Property no matter how acquired by the City, whether such water rights shall be riparian, overlying,
appropriative, littoral, percolating, prescriptive, adjudicated, statutory or contractual, together with
the perpetual right and power to explore, drill, re -drill and remove the same from or in the Property,
to store the same beneath the surface of the Property and to divert or otherwise utilize such water,
rights or interests on any other property owned or leased by the City; but without, however, the
right to enter upon or use the surface of the Property in the exercise of such rights or otherwise
adversely affect the use or operation of the Property as anticipated by this Agreement or the
structural integrity of any improvements on the Property.
3. Purchase Price; Other Payments.
(a) Purchase Price. The purchase price for the Property ("Purchase Price")
shall be Four Million Dollars ($4,000,000).
(i) The Purchase Price shall be paid as follows:
(1) Within three (3) business days following the Effective Date,
Seller and Buyer shall open an escrow in connection herewith ("Escrow") with Kelly Simoneau
at First American Title Insurance Company (3281 E. Guasti Road, Suite 440, Ontario, CA 91761;
(909) 510-6206; e-mail: kiimoneau@firstam.com) ("Escrow Holder"), and Buyer shall deposit
into Escrow One Hundred Thousand Dollars ($100,000) ("Deposit") in cash or other immediately
available funds.
(2) The Deposit shall be held by Escrow Holder in an interest -
bearing account for the benefit of Buyer in accordance with this Agreement. Notwithstanding
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anything herein to the contrary, One Hundred Dollars ($100) of the Deposit (the "Independent
Consideration") shall not be refundable to Buyer, but shall represent consideration for this
Agreement and shall be paid to Seller. The Independent Consideration shall be paid to Seller
within three (3) days of the Effective Date. The Independent Consideration shall serve as
consideration for the granting of the time periods herein contained for Buyer to exercise Buyer's
right to satisfy and approve all of Buyer's conditions herein contained.
(3) The Deposit (less the Independent Consideration) is referred
to herein from time to time as the "Earnest Money." The Earnest Money shall be held by Escrow
Holder in an interest -bearing account for the benefit of Buyer in accordance with this Agreement.
(4) If the Closing (as defined herein) as contemplated hereunder
should occur, then the Earnest Money will be paid by the Escrow Holder to Seller at the Closing,
and the Earnest Money and any interest accrued thereon will be credited against the Purchase Price
payable by Buyer to Seller at the Closing.
(5) If this Agreement is not terminated prior to the expiration of
the Due Diligence Period, the Earnest Money and any interest accrued thereon shall be
nonrefundable to Buyer, and Buyer shall have waived its right to terminate this Agreement
pursuant to Section 5(b), except that if this Agreement is terminated prior to the Closing due to
Seller's default or the failure of any of the Conditions Precedent (as defined herein) or as expressly
set forth herein, then the Earnest Money together with any interest accrued thereon shall be
returned to Buyer. The Earnest Money together with all interest accrued thereon shall be applied
to the Purchase Price at the Closing.
(6) On or before the Closing, if this Agreement has not been
earlier terminated, Buyer shall deposit into Escrow cash or other immediately available funds in
the amount of the balance of the Purchase Price, less any credits due Buyer hereunder (the
"Closing Amount"). The Closing Amount shall be applied towards the Purchase Price at the
Closing.
(b) Backbone Contribution. The development of the Property, together with
the development of the remainder of the Tustin Legacy project, will contribute to the need for
backbone infrastructure improvements located off -site, including but not limited to roadway
improvements, traffic and circulation mitigation measures, domestic and reclaimed water systems,
sewer, telemetry, storm drains and flood control channels, and backbone utility infrastructure
(including electricity, gas, telephone, cable, and telecommunications), all as part of the
infrastructure program in effect as of the Closing (the "Tustin Legacy Backbone Infrastructure
Program"). The parties acknowledge that the Purchase Price does not include Buyer's fair share
contribution to the development of the Tustin Legacy Backbone Infrastructure Program. Buyer
has had the opportunity to review the budgets, plans, and projections prepared in connection with
the Tustin Legacy Backbone Infrastructure Program, as well as related studies and materials made
available by Seller. As part of Buyer's obligations under this Agreement, Buyer shall, on or before
Closing, pay Seller $1,640,217.83 ("Backbone Contribution") as Buyer's maximum contribution
toward the Tustin Legacy Backbone Infrastructure Program, calculated at $493,447 per acre, to be
paid at Closing. Buyer may pay the Backbone Contribution at Closing or elect in writing on or
before Closing to defer such payment for a period of the earlier of ("Backbone Contribution
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Payment Date"): (x) 12 months from the date of Closing or (y) the date Buyer pulls permits for
construction of any building on the Property. If Buyer elects to defer payment of the Backbone
Contribution, interest shall accrue on the Backbone Contribution from the Closing at a rate equal
to the WSJ Prime Rate, and the total amount including all accrued interest, shall be due and payable
on the Backbone Contribution Payment Date. In no event shall Buyer have any obligation for
payment toward Tustin Legacy Backbone Infrastructure in excess of the Backbone Contribution,
subject to applicable interest in the event Buyer elects such deferral.
4. Title to the Property. At the Closing, Seller shall cause to be conveyed to Buyer
fee simple title to the Property by duly executed and acknowledged quitclaim deed substantially
in the form attached hereto as Exhibit B and incorporated herein by this reference (the "Deed").
In addition to the Deed, a separate restrictive covenant agreement ("Restrictive Covenant") shall
be recorded against the Property at closing substantially in the form attached as Exhibit C, running
with the land and binding on all future owners, providing that (a) the Property shall be used
exclusively for religious facility purposes. As used in this Agreement, Closing (the "Closing")
shall be deemed to occur upon the recording of the Deed. Evidence of delivery of fee simple title
shall be the issuance by Escrow Holder to Buyer of an ALTA standard coverage owner's policy
of title insurance in the amount of the Purchase Price, insuring fee simple title to the Property in
Buyer, subject only to such exceptions as Buyer shall have approved as provided below, including
the SLA Covenant as an approved exception (the "Title Policy"). The Title Policy shall provide
full coverage against mechanics' and materialmen's liens and shall contain such special
endorsements as Buyer may reasonably require, including, without limitation, any endorsements
required as a condition to Buyer's approval of any title exceptions (the "Endorsements"). Within
ten (10) business days following the opening of Escrow, Seller shall order the issuance of a
preliminary title report with respect to the Property, together with copies of all underlying
documents referenced therein and a map containing a plotting of all easements capable of being
plotted (collectively, the "Preliminary Report"), to be prepared by the Escrow Holder and
delivered to Buyer. No later than sixty (60) days after receipt of the Preliminary Report, Buyer
shall give written notice to Seller of any items contained in the Preliminary Report which Buyer
disapproves ("Buyer's Disapproval Notice"). Failure of Buyer to notify Seller of Buyer's
disapproval of all or any item on the Preliminary Report shall be deemed to be an approval by
Buyer of such item(s). In any event, Seller covenants to remove as exceptions to title prior to the
Closing, any mortgages, deeds of trust, and other monetary encumbrances (collectively,
"Disapproved Liens") shown on the Preliminary Report except for (i) real property taxes not
delinquent (if any), (ii) assessments and special taxes imposed upon the Property by Seller and by
other governmental entities and (iii) any liens or costs, including construction liens caused by or
arising from or in connection with the Inspections as described in Section 5. Seller shall notify
Buyer no later than five (5) business days after receipt of Buyer's Disapproval Notice whether it
elects to remove such other items disapproved by Buyer. If by the expiration of the Due Diligence
Period, there remain exceptions to title which have not been modified to the satisfaction of Buyer
and/or removed prior to the Closing Date, then Buyer may elect to do either of the following by
the expiration of the Due Diligence Period: (i) accept such exceptions and proceed to take title to
the Property subject to such exception(s); or (ii) this Agreement may be terminated in accordance
with Section 5(b). In the event Buyer elects to terminate this Agreement pursuant to this Section 4,
neither party shall have any further obligations to the other hereunder (except under provisions of
this Agreement which specifically state that they survive termination).
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5. Inspections; Due Diligence; Entitlements.
(a) Inspections. From and after the Effective Date until the Closing or earlier
termination of this Agreement, Seller shall afford authorized representatives of Buyer ("Buyer
Representatives") access to the Property, upon one (1) business day prior notice to Seller, and so
long as such access does not unreasonably interfere with the conduct of business on or use of the
Property, for purposes of conducting such physical inspections and investigations of the Property
as Buyer deems necessary (the "Inspections"). Seller's representative shall be present with Buyer
or Buyer's representative for any access to the Property unless otherwise specified by Seller in
writing. The Inspections and investigations, shall be at Buyer's sole cost and expense, and may
include, without limitation, (i) a review of existing zoning, entitlement, planning or similar issues
applicable to the Property; (ii) a review of the physical condition of the Property and the systems
serving the Property; (iii) a review of the environmental condition of the Property, including a
Phase I environmental site assessment and any proposal regarding a Phase II environmental site
assessment; and (iv) investigation on all matters related to the physical, legal and environmental
characteristics of the land and its potential for development, requirements for entitlements, land
use, building permits and fees from governmental agencies, improvements to be constructed on
the Property, economic feasibility studies and analysis, and all other matters related to the
development and construction of Buyer's proposed project. Buyer agrees not to conduct or cause
to be conducted any invasive testing, including a Phase II environmental site assessment without
the prior written consent of Seller, which may be withheld in Seller's sole discretion.
(i) If Buyer is allowed any invasive testing, or in any activity or
Property entry conducted in connection with the Inspections, Buyer shall, at its own cost and
expense, take any necessary action to keep the Property in good order and repair and safe condition
to the extent that such Property was in such condition prior to Buyer's entry, and the whole of the
Property, in a clean, sanitary and orderly condition, including, without limitation, ensuring that
any holes, ditches or other indentations, as well as any mounds or other inclines created by any
excavation by Buyer or Buyer Representatives are regraded, resurfaced and compacted. If any
portion of the Property or an adjacent property, including improvements and fixtures thereon,
suffers damage or alteration by reason of the access and activities of Buyer or its Representatives
on the Property, Buyer shall, at its own cost and expense, promptly repair all such damage and
restore the Property or adjacent property to as good a condition as before such damage or alteration
occurred, or if it cannot be repaired, Buyer shall replace such damaged or altered property to the
extent possible.
(ii) Buyer shall not suffer or permit any mechanic's or materialmen's or
other lien to stand against the Property in connection with any labor, materials or services furnished
or claimed to have been furnished by or on behalf of Buyer in connection with or as a result of any
Inspections. If any such lien shall be filed against the Property, Buyer shall cause such lien to be
discharged or bonded within thirty (30) days after such filing.
(iii) Buyer agrees, at its sole cost and expense, to defend, protect,
indemnify, and hold free and harmless Seller and its elected and appointed officials, employees,
agents, attorneys, affiliates, representatives, contractors, successors and assigns individually as
"Indemnitee" and collectively, "Indemnitees"), free and harmless from and against any and all
damages, costs, expenses, liabilities, claims, demands, causes of action, proceedings, expenses,
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judgments, penalties, fines, liens, and any losses of any nature whatsoever, including fees of
accountants, attorneys, expert witnesses, or other professionals, and all fees and costs associated
therewith ("Claims"), arising or claimed to arise, directly or indirectly from property damage or
personal injury (including death) or the exacerbation of any existing Property conditions,
including, without limitation, the presence or release of hazardous materials related to any act,
failure to act, error, or omission of Buyer or any of its Representatives arising or claimed to arise,
directly or indirectly, out of, in connection with, resulting from, or related to entry upon the
Property pursuant to this Section 5. This indemnity shall not apply for any portion or percentage
of a Claim against an Indemnitee based on the comparative gross negligence or willful misconduct
of such Indemnitee. Buyer's obligations under this Section 5 shall survive the Closing or earlier
termination of this Agreement.
(iv) Upon the Effective Date and until the date of Closing, Buyer and
Buyer's Representatives shall carry, maintain, and keep in full force and effect, with an insurance
company admitted to do business in California the insurance policies with minimum limits as set
forth in Exhibit G ("Insurance Requirements"). Buyer shall deliver to Seller a copy of the
certificates of insurance effectuating the insurance required hereunder, or such other evidence as
Seller may reasonably require, prior to Buyer's or Buyer's Representative's entry onto the Property
pursuant to Section 5(a), which certificates shall provide that such insurance shall not be
terminated or modified without at least thirty (30) days' prior written notice to Seller.
(b) Due Diligence. As used herein, the term "Due Diligence Period" shall refer
to a period of time to expire at 5:00 p.m., California time, on the 270th calendar day following the
Effective Date; provided, however, that if the 270th day is a Saturday, Sunday or holiday on which
banking institutions are closed in the State of California, then the Due Diligence Period shall expire
on the following business day. Buyer may elect, by written notice to Seller at any time prior to
the expiration of the Due Diligence Period, to terminate this Agreement, which election shall be
in Buyer's sole and absolute discretion. If Buyer desires to terminate this Agreement pursuant to
this Section 5(b) then before the expiration of the Due Diligence Period, Buyer shall deliver written
notice to Seller of Buyer's election to terminate (the "Buyer's Notice to Terminate"). If Buyer
desires to proceed with the purchase of the Property subject to the remaining conditions set forth
in this Agreement, then on or before the expiration of the Due Diligence Period, Buyer shall deliver
written notice to Seller of such election to proceed (the "Buyer's Notice to Proceed"), electing to
waive Buyer's right of termination pursuant to this Section 5(b) and proceed with the Closing
subject to the remaining conditions set forth in this Agreement. If Buyer fails to deliver either
Buyer's Notice to Terminate or Buyer's Notice to Proceed to Seller prior to the expiration of the
Due Diligence Period, then Buyer shall be deemed to have elected to terminate this Agreement,
and Escrow shall refund the Earnest Money to Buyer. In the event of the termination of this
Agreement pursuant to this Section 5(b), neither party shall have any further obligations to the
other hereunder (except under provisions of this Agreement which specifically state that they
survive termination).
(c) In the event Buyer elects to terminate this Agreement pursuant to
Section 5(b), or if Closing does not occur for any reason, Buyer shall return all Seller's Deliveries
to Seller. Buyer further agrees that prior to Closing, Buyer shall provide Seller with copies of all
non -confidential studies, reports, appraisals and other materials commissioned by or prepared for
Buyer relating to or regarding the Property ("Buyer's Reports"), at no cost to Seller.
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(d) Entitlements/Milestones. Buyer covenants and agrees as follows:
(i) Entitlement Obligation. Following the Effective Date, Buyer shall
at its sole cost and expense, diligently pursue and obtain all discretionary governmental approvals
necessary for the construction and use of Buyer's planned building facility and parking on the
Property ("Entitlements"). Buyer acknowledges and agrees the issuance of ministerial building
permits shall not be considered an Entitlement nor a Buyer Condition to close.
(ii) Buyer shall cause preparation and submission of all site plans and
related materials necessary for a complete conditional use permit ("CUP") application (the "CUP
Submittal") within 90 days following the Effective Date of this Agreement (the "CUP Submittal
Deadline").
(iii) Entitlement Deadline. On or before September 30, 2026 (the
"Entitlement Deadline"), Buyer shall cause all required plans, applications, and submittals
necessary to obtain the Entitlements to be timely prepared and submitted to the City of Tustin (in
its governmental capacity), such that, by such date, City of Tustin staff review may be completed,
such application submitted for review and action by the Planning Commission and City Council,
approval has been received on the Entitlements, and all applicable appeal periods have expired. In
no way shall this Buyer covenant bind City of Tustin (in its governmental capacity) to limit or
constrain its discretionary authority in taking action on such application. If a valid appeal under
CEQA is timely filed, the Entitlement Deadline shall be extended to the earlier of (aa) 24 months
or (bb) until such claim has been dismissed, withdrawn or resolved by a court of applicable
jurisdiction.
(iv) Consequences of Delay. If Buyer fails to obtain the Entitlements
within ninety (90) days following the Entitlement Deadline, Seller shall have the right, in its sole
and absolute discretion, upon notice to Buyer and Escrow to: (a) increase the Purchase Price and
any unpaid City -related fees by four percent (4%) and (b) require Escrow to immediately release
the Deposit to Seller, whereupon the Deposit shall become nonrefundable to Buyer. The foregoing
shall constitute consideration for the continued effectiveness of this Agreement, the extension of
Seller's obligations hereunder, and the ongoing unavailability of the Property for alternative sale,
lease, or development by Seller. In the event Seller elects to exercise its rights under (a) and (b)
above, the parties shall enter into a written amendment to this Agreement to reflect such
modifications. If Buyer fails to obtain the Entitlements within twelve (12) months following the
Entitlement Deadline (as such Entitlement Deadline may be extended pursuant to Section 5(d)(iii)
above), then Seller shall have the right to terminate this Agreement upon written notice to Buyer.
(v) Condition of Approval. If a CUP is granted, Buyer (as applicant
thereunder) agrees the following be included as a condition of approval:
(1) CEQA Indemnification. "As a condition of approval of CUP
2025-, the applicant and property owner agree, at their sole, joint and several cost and expense,
to defend with counsel approved by the City, indemnify, and hold harmless the City, its officers,
employees, agents, and consultants, from any claim, action, lawsuit, writ, or other administrative
or judicial proceeding brought by a third party against the City, its officers, agents, or employees,
which (a) seeks to attack, set aside, challenge, void, or annul an approval of the City Council, the
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Planning Commission, or any other decision -making body, including staff, concerning this project
or (b) allege violation(s) of any Federal or State law(s) in the approval or implementation of this
project. The City agrees to promptly notify the applicant and/or property owner of any such claim
or action filed against the City and to cooperate in the defense of any such action. The City agrees
to promptly notify the applicant and/or property owner of any such claim or action filed against
the City and to cooperate in the defense of any such action."
(2) General Compliance "As a condition of approval of CUP
2025-, at all times during the project's operation under the CUP, applicant and the property
owner agree comply with all applicable federal, state, and local laws, ordinances, regulations, and
requirements, whether now in force or hereafter enacted, including but not limited to those
governing land use, construction, building, safety, environmental protection, and accessibility."
(3) All indemnities and obligations set forth in this Section 5
(d)(v) are intended to encompass the Buyer entity and any affiliate (as applicant and future
property owner) as the indemnitors. Seller shall be the indemnified party, not the indemnitor in
these covenants, notwithstanding that during the Entitlement process Seller is the property owner
at such time. Nothing in this provision abrogates or otherwise limits City's discretion in its police
powers to grant or not grant the CUP and/or Entitlements, and such decisions remain in its
discretion as the jurisdictional authority with full power to determine such matters.
6. Deliveries.
(a) Seller's Deliveries. As of the Effective Date, Seller has delivered to Buyer,
whether electronically or otherwise, the materials described on Exhibit E, which contain copies of
documents in Seller's possession or control, or to which Seller has access (collectively, the "Seller
Deliveries"). Seller makes no representation whatsoever about the content, accuracy,
completeness or value of any of Seller's Deliveries. All Seller's Deliveries have been provided to
Buyer without warranty from Seller regarding the accuracy or completeness of the information
contained therein, and such documents may or may not be assignable to Buyer. The delivery of
such reports and studies shall be subject to the proprietary rights of any engineer or other consultant
preparing the same and any limitations on use imposed by them. Buyer assumes all risk of
reviewing and understanding any and all information contained in Seller's Deliveries.
(b) Delivery of Buyer Authority Documents and Consent. Within five (5)
business days after the Effective Date, Buyer shall deliver to Seller (or provide to Seller's legal
counsel) (i) a resolution from Buyer authorizing the transactions contemplated hereby and naming
the officers of Buyer who are authorized to execute all documents and instruments necessary to
complete the transactions contemplated by this Agreement (the "Consent").
7. Conditions to Closing.
(a) Seller's Conditions to Closing. Seller's obligations hereunder, including,
but not limited to, its obligation to consummate the purchase transaction provided for herein, are
subject to the satisfaction of each of the following conditions, each of which is for the sole benefit
of Seller and may be waived by Seller in writing in Seller's sole and absolute discretion. In the
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event any of the Seller's conditions described below are not satisfied, Seller may, in its sole and
absolute discretion, terminate this Agreement, subject to the provisions of Section 8.
(i) Buyer shall not be in default under this Agreement.
(ii) Each representation and warranty made in this Agreement by Buyer
shall be true and correct in all material respects at the time as of which the same is made and as of
the Close of Escrow.
(iii) Seller shall have recorded the SLA Covenant.
(iv) TUSD CFD 15-2. Seller shall be responsible for filing any
application or documentation required to effectuate the removal of the Property from Tustin
Unified School District (TUSD) Community Facilities District 2015-2 (TUSD CFD 15-2), and
shall complete such removal on or prior to Closing. Buyer shall reasonably cooperate with Seller
in connection with such filing and shall promptly provide any certificates, consents, or other
documentation required or requested by Seller.
(b) Buyer's Conditions to Closing The following are conditions to Buyer's
obligation to purchase the Property (each a "Buyer Condition" and collectively the "Buyer
Conditions"). The Buyer Conditions are intended solely for the benefit of Buyer and may be
waived only by Buyer in writing in Buyer's sole and absolute discretion. In the event any of the
Buyer Conditions is not satisfied, Buyer may, in its sole and absolute discretion, terminate this
Agreement, subject to the provisions of Section 8.
(i) Buyer's inspection, review and approval, within the Due Diligence
Period, of all the physical characteristics and condition of the Property (including without
limitation the condition of the soils) and Seller's Deliveries.
(ii) Escrow Holder shall be unconditionally committed to issue the Title
Policy to Buyer upon the Closing in the form and with such exceptions and endorsements as have
been approved, or are deemed approved, by Buyer as provided in Section 4 above.
(iii) The Property shall be delivered at Closing to Buyer in a rough
graded condition (with confirmation from a Civil Engineer certification) with utilities available
and base paving of adjacent roads complete (the "Property Delivery Condition"). The Property
Delivery Condition shall exclude any damage to the Property caused by Buyer or Buyer
Representatives in connection with Buyer's Inspections. The Property Delivery Condition shall
be evidenced by City's Public Works Director's written confirmation that the Property has been
delivered in accordance with the requirements of this Section 7(c)(iii) ("Property Delivery
Confirmation").
(iv) Establishment of the CFD (as defined in Section 9(a) below).
(v) Buyer shall have received all discretionary Entitlements subject to
Section 5(d) above.
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(vi) Seller shall have complied with all of Seller's duties and obligations
contained in this Agreement and all of Seller's representations and warranties contained in or made
pursuant to this Agreement shall have been true and correct when made and shall be true and
correct as of the Closing Date.
(c) E fect of Failure of Closing Conditions. Neither Buyer nor Seller shall act
or fail to act for the purpose of permitting or causing any closing condition to fail. Waiver of any
condition to close of escrow shall not relieve any party for liability resulting from breach of any
representation, warranty, covenant or agreement under this Agreement. In the event that the
conditions to close of escrow are not timely satisfied for a reason other than a default of Buyer or
Seller under this Agreement:
(i) This Agreement, the escrow and the rights and obligations of Buyer
and Seller hereunder shall terminate, except as otherwise provided herein; provided, however, no
such termination shall occur until (A) the party benefitted by a closing condition has had the
opportunity to waive such condition within two (2) business days after the later of such party's
receipt of written notice from the other party or the benefitted party's discovery that such condition
will not be satisfied, and (B) the benefitted party does not elect to waive such condition; and
(ii) Escrow Holder, upon such termination, is hereby instructed to
promptly return to Buyer all funds (and all interest accrued thereon) and documents deposited by
Buyer in escrow and to return to Seller all funds and documents deposited by Seller in escrow and
which are held by Escrow Holder on the date of the termination (less, in the case of the party
otherwise entitled to such funds, however, the amount of any escrow cancellation charges required
to be paid by such party under Section 10(f) below).
8. Default, Termination, and Remedies.
(a) Seller's Default; Termination; Remedies. Provided that Buyer is not then
in material breach of this Agreement, Buyer may elect to terminate this Agreement by delivering
written notice to Seller upon the occurrence of any of the following events: (a) any condition to
Closing contained in Section 7 has not been satisfied or waived by Buyer on or prior to the Closing
Date; or (b) Buyer having exercised its right to terminate this Agreement pursuant to Section 4
(disapproval of title), Section 5 (disapproval of Due Diligence Period), or Section 15
(Condemnation). In such event, the parties shall have no further obligation to each other except
for those obligations that specifically survive the termination of this Agreement. In the event of
Seller's default of this Agreement which Seller fails to cure within five (5) days following receipt
of written notice thereof and provided that Buyer is not then in material breach of this Agreement,
Buyer may: (i) seek to enforce specific performance of Seller's obligations hereunder; or
(ii) terminate this Agreement by providing written notice thereof to Seller, whereon Buyer shall
be entitled to a disbursement of the Deposit and payment by Seller of all of the reasonable and
documented (by invoice) out-of-pocket costs and expenses incurred by Buyer in connection with
this transaction and its due diligence and inspections of the Property, including reasonable
attorneys' fees and costs, up to a maximum recovery by Buyer (in addition to the return of the
Earnest Money) of $25,000 in the aggregate. Upon such termination, neither Buyer nor Seller
shall have any further rights, obligations or liabilities hereunder, except as otherwise expressly
provided herein. For purposes of this provision, specific performance shall be considered not
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available to Buyer if a court of competent jurisdiction determines conclusively that Buyer is
entitled to specific performance on the merits of its claim but said court is unable to enforce
specific performance due to reasons beyond the control of the court. Notwithstanding the
foregoing, in the event of a willful or intentional default of Seller hereunder, and provided specific
performance is not an available remedy therefor, Buyer shall, in addition to the foregoing, be
permitted to pursue any and all rights and remedies available to Buyer at law or in equity in the
event of any intentional misrepresentation of a material fact concerning the Property or fraud on
the part of Seller; or in the event of the intentional failure by Seller to disclose any material fact or
defect concerning the Property that is not readily observable; or (y) if specific performance is not
available as a result of actions taken by Seller; in all such cases, Buyer shall not be subject to the
limitations (including, without limitation, the limitations on damages) set forth above (or
elsewhere in this Agreement, including, without limitation, Section 8(c) below). This Section 8(a)
shall survive the termination of this Agreement and the Closing for a period of one hundred -twenty
(120) days.
(b) Buyer's Default; Termination; Remedies. If this Agreement has not been
terminated by Buyer prior to the expiration of the Due Diligence Period and the Closing fails to
occur by reason of Buyer being in default of its covenants or obligations under this Agreement,
which default is not caused by Seller, then Seller may elect to terminate this Agreement by
providing written notice to Buyer and Escrow Holder, in which case Escrow Holder, without
further direction from either party, shall disburse the Earnest Money to Seller within one (1)
business day after such termination, all escrow and title cancellation costs shall be borne solely by
Buyer, and Seller and Buyer shall have no further rights or obligations under this Agreement,
except those which expressly survive termination of this Agreement.
(i) LIQUIDATED DAMAGES. IF THE SALE OF THE PROPERTY
PURSUANT TO THIS AGREEMENT IS TERMINATED PURSUANT TO SECTION 8(B),
THE DEPOSIT AND ALL BUYER'S NON -CONFIDENTIAL, PROPERTY -SPECIFIC
REPORTS, SHALL BE RETAINED BY SELLER AS LIQUIDATED DAMAGES. THE
PARTIES HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE EVENT OF A
DEFAULT BY BUYER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICABLE TO
DETERMINE. THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES
ACKNOWLEDGE THAT THE EARNEST MONEY AND BUYER'S NON -CONFIDENTIAL,
PROPERTY -SPECIFIC REPORTS HAVE BEEN AGREED UPON, AFTER NEGOTIATION,
AS THE PARTIES' REASONABLE ESTIMATE OF SELLER'S DAMAGES AND AS
SELLER'S SOLE AND EXCLUSIVE REMEDY AGAINST BUYER, AT LAW OR IN
EQUITY, IN THE EVENT OF A DEFAULT UNDER THIS AGREEMENT ON THE PART OF
BUYER. UPON THE OCCURRENCE OF ANY SUCH DEFAULT BY BUYER, BUYER
SHALL DELIVER WITHIN ONE (1) BUSINESS DAY OF SELLER'S REQUEST ON AN AS -
IS BASIS ALL BUYER'S NON -CONFIDENTIAL, PROPERTY -SPECIFIC REPORTS AND
APPROPRIATE DOCUMENTS ASSIGNING SAME TO SELLER. SELLER HEREBY
WAIVES ANY AND ALL BENEFITS IT MAY HAVE UNDER CALIFORNIA CIVIL CODE
SECTION 3389. FURTHERMORE, THE PAYMENT AND RETENTION OF SUCH
EARNEST MONEY AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE
OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275
AND 3369, BUT IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER
PURSUANT TO CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677.
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INITIALS: Buyer
(c) Limitation Of Liability. Notwithstanding anything to the contrary
contained in this Agreement: (a) Seller is not assuming any, and shall have no, personal liability
for any obligations of Seller under this Agreement, (b) in no event shall Seller be liable for any
consequential, punitive or exemplary damages, (c) in connection with any action alleging a breach
of any warranty of title in the Property, Buyer agrees that it shall in good faith pursue the Title
Company under its title policy(ies) with respect to any claim relating to title under the Deed prior
to bringing an action against Seller, (d) if prior to Closing, Buyer shall not have the rightto exercise
its remedies under this Agreement for a Seller default unless Buyer has provided written notice to
such defaulting Seller specifying in reasonable detail the nature of (lie Seller default, and Seller
has not cured the same within ten (10) days after Seller's receipt of such notice (the "Cure
Period"), in which case the Closing shall be postponed until the date which is two (2) business
days after the expiration of the Cure Period. If the Closing of the transactions under this Agreement
shall have occurred, Seller shall not have any liability to Buyer (and Buyer shall make no claim
against Seller) for a breach of any representation or warranty or any other covenant, agreement or
obligation of Seller, or for indemnification, under this Agreement or any document executed by
Seller in connection with this Agreement, unless (A) the valid claims for all such breaches and
indemnifications collectively aggregate to more than Twenty -Five Thousand Dollars ($25,000) (in
which case Buyer shall be entitled to recover from Seller all amounts below such "floor"), and
(B) the liability of Seller under this Agreement and such documents shall not exceed, in the
aggregate, Two Hundred Thousand Dollars ($200,000).
(d) Reserved Claims. Notwithstanding the covenants, waivers, releases,
assumptions of risk and/or discharges given by Buyer in this Agreement but subject to the
applicable limitations on liability set forth in Section 8(c) above: (x) in no event does Buyer waive
its right to recover from, or release or discharge Seller from, any claim, costs, Ioss, Iiability,
damage, expenses, demand, action or cause of action arising from or in any way related to:
(i) Seller's breach of its obligations, representations, warranties, covenants or agreements under
this Agreement that expressly survive the Closing, and/or (ii) Seller's intentional
misrepresentation of a material fact concerning the Property or fraud, or Seller's intentional failure
to disclose any material fact or defect concerning the Property that is not readily observable
(collectively, the "Reserved Claims"); and (y) in no event shall the waivers, assumptions of risk,
releases and/or discharges given and made by Buyer in this Section 8(d) and/or elsewhere in this
Agreement impose (or be deemed to impose) on Buyer any liability or obligation whatsoever
(whether equitable or otherwise) to indemnify, defend or hold Seller (or any other party) harmless
from and against any claims or other actions that may be brought against Seller (or any other party)
unless Buyer has expressly agreed to so indemnify Seller from such claims under the express terms
of this Agreement,
9. Post -Closing Covenant. The parties acknowledge, agree, and covenant that:
(a) Property Obligation for Community Facilities District,• CFD 18-01
Expense. The City has previously established Community Facilities District No. 18-01
("District"). The City, by action of the City Council, intends to annex the Real Property into the
District as CFD 18-01 Zone 4 prior and as a condition to the Close of Escrow and to adopt a rate
and method of apportionment ("RMA") for CFD 18-01 Zone 4. Subject to the annexation
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documents and RMA for CFD 18-01 Zone 4 being consistent with the other terms of this
Agreement related to CFD 18-01 Zone 4, including all of the terms in this Section 9, Buyer, on
behalf of itself and its successors and assigns agrees to the imposition of the special tax lien of
CFD 18-01 Zone 4, the proceeds of which shall be used by the City to fund a portion of City
essential services, including but not limited to police protection services, fire protection services,
ambulance and paramedic services, recreation program services, maintenance of City -owned
parks, parkways and open space, flood and storm protection and street and sidewalk maintenance
at Tustin Legacy. Upon annexation into the District, the Property shall be obligated to pay to City
an annual fee of $0.50 per square foot of permitted building square footage actually constructed
on the Property (the "CFD Fee"), as the maximum contribution, subject to the 2% annual
escalation below, toward the City of Tustin Community Facilities District No. 18-01. At the time
of annexation into the District, the Property will be de -annexed from City of Tustin Community
Facilities District No. 13-01. The CFD Fee shall begin to accrue upon annexation and shall be
payable annually. The CFD Fee shall escalate by 2% annually and shall continue in perpetuity.
This obligation shall survive Closing and run with the land as a special tax assessment, enforceable
against the Property and any successors -in -interest.
(b) Landscape Installation and Maintenance Agreement; Access Easement.
(i) Effective as of Closing, Buyer shall be solely responsible for
installing, at its sole cost and expense, and maintaining, at its sole cost and expense, in good, clean,
and orderly condition all landscaping and improvements located within the public right-of-way
adjacent to the Property, including any sidewalks, parkways, planters, street trees, and related
irrigation infrastructure ("ROW Landscaping") The Parties shall meet and confer during the Due
Diligence Period to coordinate and define the scope of the ROW Landscaping improvements.
Seller shall retain responsibility for maintaining the existing sidewalk adjacent to the Property
("ROW Sidewalk") and shall maintain it in a safe and code -compliant condition. The Parties
acknowledge and agree that a separate landscape installation and maintenance agreement (the
"Landscape Installation and Maintenance Agreement") shall be negotiated and finalized
during the Due Diligence Period ,but in no event later than the Entitlement Deadline, and recorded
against the Property on the Closing, to further detail Buyer's maintenance obligations with respect
to the ROW Landscaping and Seller's maintenance obligations with respect to the ROW Sidewalk.
The City's execution of any Landscape Installation and Maintenance Agreement shall be subject
to Section 21(e) of this Agreement, allowing for the City Manager (or designee) to approve,
execute, and administer such agreement without further action by the City Council, except where
City Council approval is expressly required by applicable law.
(ii) To ensure Buyer's compliance under the Landscape and
Maintenance Agreement, Seller shall retain a non-exclusive access easement ("Access
Easement") over the ROW Landscaping area for the limited purpose of inspecting and, if
necessary, remedying any failure by Buyer to maintain such improvements in accordance with this
covenant and the Landscape and Maintenance Agreement. If Buyer fails to cure any breach of its
maintenance obligations within the period set forth in Landscape and Maintenance Agreement
following written notice from Seller, Seller shall have the right, but not the obligation, to perform
such maintenance and recover all reasonable costs incurred from Buyer. This covenant shall run
with the Property and be binding upon Buyer and its successors and assigns, and shall benefit
Seller and its successors and assigns.
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(iii) Prior to or after Closing, Buyer shall, at its sole cost and expense,
obtain and deliver to Seller a title insurance policy (or endorsement to an existing policy), issued
by Title Company or by a nationally recognized title company reasonably acceptable to Seller,
insuring Seller's Access Easement rights as granted under this Section 9 (the "Easement Title
Policy"). The Easement Title Policy shall be in form and amount reasonably satisfactory to Seller,
and shall insure the easement rights as perpetual, appurtenant to Seller's retained property, and
free from any monetary liens or encumbrances not approved by Seller in writing. Buyer shall be
solely responsible for all costs, premiums, and related escrow or recording fees associated with the
Easement Title Policy.
(c) The covenants under this Section 9 shall survive Closing.
10. Escrow; Closing, Prorations.
(a) Upon mutual execution of this Agreement, the parties hereto shall deposit
an executed counterpart of this Agreement with Escrow Holder and this Agreement shall serve as
instructions to Escrow Holder for consummation of the purchase contemplated hereby. Seller and
Buyer shall execute such supplemental Escrow instructions as may be appropriate to enable
Escrow Holder to comply with the terms of this Agreement, provided such supplemental Escrow
instructions are not in conflict with this Agreement as it may be amended in writing from time to
time. In the event of any conflict between the provisions of this Agreement and any supplementary
Escrow instructions signed by Buyer and Seller, the terms of this Agreement shall control.
(b) The Closing shall take place (the "Closing Date") on a date that is thirty
(30) days after the earliest to occur of. (i) the satisfaction (or the waiver thereof by the applicable
party, of the closing conditions listed in Section 7 above or (ii) the Entitlement Deadline (as may
be extended under Section 5(d)(iii)).
(c) At or before the Closing, Seller shall deliver to Escrow Holder or Buyer the
following:
(i) the duly executed and acknowledged Deed for the Property in the
form attached as Exhibit B;
(ii) a duly executed Covenant in the form attached as Exhibit C,
(iii) a duly executed affidavit that Seller is not a "foreign person" within
the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986 in the form attached as
Exhibit D and incorporated herein by this reference together with a duly executed non -foreign
person affidavit and evidence that Seller is exempt from the withholding obligations imposed by
California Revenue and Taxation Code Sections 18805, 18815, and 26131;
(iv) evidence reasonably acceptable to Escrow Holder that the
documents delivered by Seller have been duly authorized and executed on behalf of Seller and
constitute valid and binding obligations of Seller.
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(v) any other documents which the Escrow Holder may reasonably
require from Seller in order to close Escrow on a GAP basis which do not increase Seller's liability
or obligations hereunder;
(vi) a closing statement in form and content satisfactory to Buyer and
Seller (the "Closing Statement") duly executed by Seller; and
(vii) any other instruments, records or correspondence called for
hereunder which have not previously been delivered.
following:
(d) At or before the Closing, Buyer shall deliver to Escrow Holder or Seller the
(i) the Closing Statement, duly executed by Buyer;
(ii) the Closing Amount;
(iii) the Backbone Contribution, unless Buyer exercises to defer payment
subject to Section 3(c) in which case the Buyer shall execute a promissory note in mutually agreed
form for such fee and deliver such note to escrow;
(iv) an executed Access Easement granted in favor of Seller;
(v) the Bring -Down Certificate;
(vi) evidence reasonably acceptable to Escrow Holder that the
documents delivered by Buyer have been duly authorized and executed on behalf of Buyer and
constitute valid and binding obligations of Buyer.
(e) Seller and Buyer shall each deposit such other instruments as are reasonably
required by Escrow Holder or otherwise required to close the Escrow and consummate the
purchase of the Property in accordance with the terms hereof.
(f) The following are to be paid by Buyer or Seller or apportioned as of the
Closing Date, as follows:
(i) General real property taxes for the year in which Closing occurs (as
necessary for Title Company to issue title insurance insuring no delinquent taxes or assessments)
together with assessments, property operating expenses, utilities and other recurring costs relating
to the Property shall be apportioned as of the Closing Date on the basis of a thirty (30)-day month.
(ii) Costs and expenses of Escrow incurred in this transaction shall be
paid as follows:
(1) Seller shall pay all sales, use and documentary transfer taxes
(except as provided in Subparagraph GOO) below);
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(2) Seller shall pay the premium for a standard ALTA coverage
owner's policy of title insurance; Buyer shall pay the premium for any extended ALTA coverage
if desired; and Buyer shall pay the premium for the Easement Title Policy;
(3) Seller and Buyer shall each pay one-half (1/2) of the Escrow
fees, recording fees and related expenses;
Seller.
(4) Seller shall pay any city or county transfer taxes due;
(5) all other costs of escrow shall be paid equally by Buyer and
(iii) The provisions of this Subpart aph W shall survive the Closing.
(iv) Escrow Cancellation Charges. In the event that this Escrow shall
fail to close by reason of the default of either party hereunder, the defaulting party shall be liable
for all escrow and title cancellation charges. In the event that the Escrow shall fail to close for any
other reason, each party shall pay one-half (1/2) of all escrow and title cancellation charges.
11. Representations, Warranties and Covenants of Seller. As of the date hereof and
again as of Closing, Seller represent and warrants to Buyer as follows:
(a) Organization. Seller is a municipal corporation, validly existing and in good
standing under the laws of the State of California. This Agreement and all documents executed
by Seller which are to be delivered to Buyer at the Closing are and at the time of Closing will be
duly authorized, executed and delivered by Seller, are and at the time of Closing will be legal,
valid and binding obligations of Seller enforceable against Seller in accordance with their
respective terms. Seller has obtained all necessary authorizations, approvals and consents to the
execution and delivery of this Agreement and the consummation of the transactions contemplated
hereby.
(b) No Action. No attachments, execution proceedings, assignments for the
benefit of creditors, insolvency, bankruptcy, reorganization or other proceedings are pending
against Seller, nor are any such proceedings contemplated by Seller;
(c) No Representations as to Property. There are no representations,
agreements, arrangements, or circumstances, oral or written, between the parties relating to the
subject matter contained in this Agreement that are not fully expressed in the Agreement, and
except as disclosed in Exhibit E, Seller has not made and does not make any representation or
warranty concerning any matter or thing affecting or relating to the Property, including but not
limited to its fitness for a particular use, its physical condition or any other matter; and
(d) Sale "AS -IS". Subject to Seller's representations and warranties contained
herein, Buyer's election to purchase the Property will be based upon and will constitute evidence
of Buyer's independent investigation of the Property, its use, development potential and suitability
for Buyer's intended use, including (without limitation) the following: the feasibility of
developing the Property for the purposes intended by Buyer and the conditions of approval for any
subdivision map; the size and dimensions of the Property; the availability, cost and adequacy of
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water, sewerage and any utilities serving or required to serve the Property; the presence and
adequacy of current or required infrastructure or other improvements on, near or affecting the
Property; any surface, soil, subsoil, till or other physical conditions of or affecting the Property,
such as climate, geological, drainage, air, water or mineral conditions; the condition of title to the
Property; the existence of governmental laws, statutes, rules, regulations, ordinances, limitations,
restrictions or requirements concerning the use, density, location or suitability of the Property for
any existing or proposed development thereof including but not limited to its entitlements and any
zoning, building, subdivision, environmental or other such regulations; the necessity or availability
of any general or specific plan amendments, rezoning, zoning variances, conditional use permits,
building permits, environmental impact reports, parcel or subdivision maps and public reports,
requirements of any improvement agreements; requirements of the California Subdivision Map
Act, and any other governmental permits, approvals or acts (collectively "Permits"); the necessity
or existence of any dedications, taxes, fees, charges, costs or assessments which may be imposed
in connection with any governmental regulations or the obtaining of any required Permits; the
presence of endangered plant or animal species upon the Property; and all of the matters
concerning the condition, use, development or sale of the Property. Seller will not be liable for
any loss, damage, injury or claim to any person or property arising from or caused by the
development of the Property by Buyer.
Except with respect to a default by Seller hereunder (including a breach of Seller's warranties and
representations), Buyer at the Close of Escrow expressly waives its rights granted under California
Civil Code Section 1542, which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT
TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM
OR HER MUST HAVE MATERIALLY AFFECTED HIS OR
HER SETTLEMENT WITH THE DEBTOR."
Buyer's Initials: Cf -- Seller's Initials:
12. Representations, Warranties and Covenants of Buyer. Buyer hereby represents and
warrants to Seller as follows:
(a) Buyer is a non-profit religious corporation duly organized, validly existing
and in good standing under federal law and the laws of California and qualified to do business in
California and any other jurisdiction where the operation of its business or its or its ownership of
property or the performance of Buyer's obligations under this Agreement make such qualification
necessary. This Agreement and all documents executed by Buyer which are to be delivered to
Seller at the Closing are and at the time of Closing will be duly authorized, executed and delivered
by Buyer, are and at the time of Closing will be legal, valid and binding obligations of Buyer
enforceable against Buyer in accordance with their respective terms, and do not and at the time of
Closing will not violate any provision of any agreement or judicial order to which Buyer is subject.
Buyer has obtained all necessary authorizations, approvals and consents to the execution and
delivery of this Agreement and the consummation of the transactions contemplated hereby.
119600.0022714914-2994-3633.2 '17'
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(b) Buyer warrants that Buyer is a sophisticated owner and buyer of real
property, familiar and experienced with requirements for the development of real property. Buyer
has examined the Property or will have done so by Closing, is or will be familiar with its physical
condition, and accepts the Property in an "AS -IS" condition.
(c) Buyer has conducted or will conduct an independent investigation with
respect to its entitlements, and any zoning and subdivision laws, ordinances, resolutions, and
regulations of all governmental authorities having jurisdiction over the Property, and the use and
improvement of the Property and is, or at Closing will be, satisfied with the results of such
investigation.
(d) Buyer has, as of the Effective Date and will have as of the Close of Escrow,
sufficient funds in liquid form or committed and available lines of credit or other financial
resources to timely perform all of its monetary obligations due on or before Closing under this
Agreement, including, without limitation, the payment of the Purchase Price and the Backbone
Contribution.
(e) Buyer acknowledges and agrees its understanding that the Property is being
sold "AS -IS" and with all faults.
(f) At the Close of Escrow, Buyer shall deliver a certificate to Seller certifying
that the representations and warranties of Buyer remain true and correct in all material respects as
of the Closing Date (the "Bring -Down Certificate").
13. Environmental Matters/Release. As used in this Agreement, "Hazardous
Materials" includes petroleum, asbestos, radioactive materials or substances defined as
"`hazardous substances," "hazardous materials" or "toxic substances" (or words of similar import)
in the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended (42 U.S.C. Section 9601, et seq.), the Hazardous Materials Transportation Act
(49 U.S.C. Section 1801, et seq.), the Resource Conservation and Recovery Act (42 U.S.C.
Section 6901, et seq.), and under the applicable laws of California. Buyer must rely on its own
investigation and not on any representation by Seller regarding Hazardous Materials. Buyer shall
rely solely upon its own investigation and inspection of the Property and the improvements thereon
and upon the aid and advice of Buyer's independent expert(s) in purchasing the Property, and shall
take title to the Property without any warranty, express or implied, by Seller or any employee or
agent of Seller. Seller makes no representations regarding Hazardous Materials in, on or under
the Property. Seller's knowledge and disclosures regarding Hazardous Materials are limited to the
contents of Seller's Deliveries.
Accordingly, Buyer hereby expressly waives and relinquishes any and all rights and remedies
Buyer may now or hereafter have against Seller, whether known or unknown, with respect to any
past, present, or future presence of Hazardous Materials on, under or about the Property or with
respect to any past, present, or future violations of any rules, regulations or laws, now or hereinafter
enacted, regulating or governing use, handling, storage or disposable of Hazardous Materials,
including, without limitation (i) any and all remedies Buyer may now or hereafter have under the
Comprehensive Environmental Response Compensation and Liability Act of 1980 ("CERCLA"),
as amended, and any similar law, rule or regulation, (ii) any and all rights Buyer may now or
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hereafter have against Seller under the Carpenter-Preslcy-Tanner Hazardous Substance Account
Act (California Health and Safety Code, Section 25300 et seq.), as amended and any similar Iaw,
rule or regulation, and (iii) any and all claims, whether known or unknown, now or hereafter
existing, with respect to the Property under Section 107 of CERCLA (42 U.S. C.A. § 9607).
BUYER HEREBY ACKNOWLEDGES THAT IT HAS READ AND IS
FAMILIAR WITH THE PROVISIONS OF CALIFORNIA CIVIL CODE SECTION 1542
("SECTION 1542"), WHICH IS SET FORTH BELOW
"A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS FAVOR
AT THE TIME OF EXECUTING THE RELEASE,
WHICH IF KNOWN BY HIM MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT
WITH THE DEBTOR"
BY INITIALING BELOW, BUYER AT THE CLOSE OF ESCROW
HEREBY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN
CONNECTION WITH THE MATTERS WHICH ARE THE SUBJECT
OF THE FOREGOING WAIVERS AND RELEASES.
(Buyer's Initials)
14. Continuation and Survival. All representations, warranties and covenants by the
respective parties contained herein or made in writing pursuant to this Agreement are intended to
and shall be deemed made as of the date of this Agreement or such writing and again at the Closing,
shall be deemed to be material, and unless expressly provided to the contrary shall survive the
execution and delivery of this Agreement, the Deed and the Closing.
15. Condemnation.
(a) In the event a governmental entity commences eminent domain proceedings
to take any portion of the Property after the date hereof and prior to the Closing, then Buyer shal I
have the option to terminate this Agreement by written notice to Seller within ten (10) business
days after Buyer first learns of such commencement. In the event of any such termination, the
Earnest Money, together with all interest, shall be returned to Buyer. Buyer and Seller shall each
be liable for one-half of any escrow fees or charges, and neither party shall have any further
liability or obligation under this Agreement.
(b) In the event a governmental entity commences eminent domain proceedings
to take any part of the Property after the date hereof and prior to the Closing and this Agreement
is not terminated pursuant to Section 15(a), then the Closing shall occur as scheduled
notwithstanding such proceeding; provided, however, that Seller's interest in all awards arising
out of such proceedings (except for any award attributable to the loss of Se[ler's business or
income, Seller's personal property, or the property of any tenant of the Property) shall be assigned
119600.0022714914-2994-3635,2 - t 9-
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to Buyer as of the Closing or credited to Buyer if previously received by Seller. Seller's obligations
pursuant to this Section 15(b) shall survive the Closing.
16. Delivery Condition; Possession. Possession of the Property shall be delivered to
Buyer on the Closing Date: (i) in accordance with the Property Delivery Condition and (ii) free
of any occupant or property not being conveyed to Buyer as provided hereunder.
17. Seller's Cooperation with Bum. At no cost to Seller, Seller shall cooperate and
do all acts as may be reasonably required or requested by Buyer, at no additional cost to Seller,
with regard to the fulfillment of any Condition Precedent. Seller hereby authorizes Buyer and its
agents to make all inquiries with and applications to any third party, including any governmental
authority, as Buyer may reasonably require to complete its due diligence and satisfy the Conditions
Precedent.
18. Brokers and Finders. Buyer has employed the firm of JLL as its broker ("Buyer's
Broker") in connection with the purchase and sale of the Property. Buyer shall be solely
responsible, pursuant to separate agreement, for any payment, fee or commission owing to Buyer's
Broker in connection with the purchase and sale of the Property in accordance with this Agreement.
Except for Buyer's Broker, neither party has had any contact or dealings regarding the Property,
or any communication in connection with the subject matter of this transaction, through any real
estate broker or other person who can claim a right to a commission or finder's fee in connection
with the sale contemplated herein. In the event that any such broker or finder claims a commission
or finder's fee based upon any contact, dealings or communication, the party through whom the
broker or finder makes its claim shall be responsible for said commission or fee and all costs and
expenses (including, without limitation, reasonable attorneys' fees) incurred by the other party in
defending against the same. The party through whom any such other broker or finder makes a
claim shall hold harmless, indemnify and defend the other party hereto, its successors and assigns,
agents, employees, officers and directors, and the Property from and against any and all
obligations, liabilities, claims, demands, liens, encumbrances and losses (including, without
limitation, attorneys' fees), arising out of, based on, or incurred as a result of such claim. The
provisions of this Section 18 shall survive the Closing or termination of this Agreement.
19. Professional Fees. If any Party to this Agreement institutes any action, suit,
proceeding, counterclaim or other proceeding for any relief against another Party, declaratory or
otherwise (collectively an "Action"), to enforce the terms hereof or to declare rights under this
Agreement or with respect to any inaccuracies or material omissions in connection with any of the
covenants, representations, warranties or obligations on the part of the other Party to this
Agreement, then the Prevailing Party (defined below) in such Action shall be entitled to have and
recover of and from the other Party all costs and expenses of the Action, including (i) the Prevailing
Party's reasonable attorneys' fees (which shall be payable at the contractual hourly rate for City's
litigation counsel at the time the fees were incurred, but in no event more than $400.00 per hour
with this rate being used to calculate the attorneys' fees to be recovered by the Prevailing Party
regardless of whether the Seller or another Person (as defined in Section 21(c)(i)) is the Prevailing
Party), and (ii) costs actually incurred in bringing and prosecuting such Action and/or enforcing
any judgment, order, ruling or award (collectively, a "Decision") granted therein, all of which shall
be deemed to have accrued on the commencement of such Action and shall be paid whether or not
such Action is prosecuted to a Decision. Any Decision entered in any final judgment shall contain
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a specific provision providing for the recovery of all costs and expenses of suit, including
reasonable attorneys' fees and expert fees and costs (collectively "Costs") incurred in enforcing,
perfecting and executing such judgment. For the purposes of this paragraph, Costs shall include
in addition to Costs incurred in prosecution or defense of the underlying action, reasonable
attorneys' fees, costs, expenses and expert fees and costs incurred in the following: (A) post
judgment motions and collection actions; (B) contempt proceedings; (C) garnishment, levy, debtor
and third -party examinations; (D) discovery; (E) bankruptcy litigation; and (F) appeals of any
order or judgment. "Prevailing Party" within the meaning of this Section 19 includes a Party
who agrees to dismiss an Action in consideration for the other Party's payment of the amounts
allegedly due or performance of the covenants allegedly breached or obtains from a court of
competent jurisdiction substantially the relief sought by such Party.
20. Publicity, City Council Approval, and ConfidentialitX. Buyer acknowledges that
Seller is a public entity and that this Agreement shall be a matter of public record, presented at a
public meeting which has been properly agendized, and available for review by the public under
the Public Records Act, and thus is not confidential. This Agreement shall be subject to City of
Tustin City Council approval in a properly noticed and agendized public meeting.
Notwithstanding the foregoing, Buyer agrees to not make any public announcements regarding the
Property prior to Closing.
21. Miscellaneous.
(a) City of Tustin. Except where expressly provided otherwise in this
Agreement, the capacity of the City in this Agreement shall be as owner and/or seller of property
only ("Proprietary Capacity"), and any obligations or restrictions imposed by this Agreement on
the City, shall be limited to that capacity and shall not relate to, constitute a waiver of, supersede
or otherwise limit or affect the exercise by the City of its governmental authority with respect to
any matter related to this Agreement which shall include the regulation and entitlement of the
Property, including enacting laws, inspecting structures, reviewing and issuing permits,
entitlements, and all of the other legislative and administrative or enforcement functions of each
pursuant to federal, State or local law ("Governmental Capacity"). In addition, nothing in this
Agreement shall supersede or waive any discretionary or regulatory approvals required to be
obtained from the City in its Governmental Capacity under applicable Governmental
Requirements.
(b) Notices. Any notice, consent or approval required or permitted to be given
under this Agreement shall be in writing and shall be deemed to have been given upon (i) hand
delivery, (ii) one business day after being deposited with Federal Express or another reliable
overnight courier service for next day delivery, (iii) upon email transmission (except that if the
date of such transmission is not a business day or if such transmission is made after 5:00 p.m. on
a business day, then such notice shall be deemed to be given on the first business day following
such transmission), or (iv) two business days after being deposited in the United States mail,
registered or certified mail, postage prepaid, return receipt required, and addressed as follows (or
such other address as either party may from time to time specify in writing to the other in
accordance herewith):
119600.00227/4914-2994-3635.2 -2 1-
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If to Seller: City of Tustin
City Manager
300 Centennial Way
Tustin, CA 92780
Attn: City Manager
Email: CityManager@tustinca.org
With a copy to: Deputy City Manager — Real Property
City of Tustin
300 Centennial Way
Tustin, CA 92780
Attn: Deputy City Manager — Real Property
Email: DCM-RP@tustinca.org
With a copy to: City Attorney
Woodruff, Spradlin & Smart
555 Anton Blvd., Suite 1200
Costa Mesa, CA 92626
Attention: David E. Kendig, Esq.
Email: dkendig@woodruff.law
With copy to: Best Best & Krieger LLP
Attn: Nancy Park
500 Capitol Mall, Suite 2500
Sacramento, CA 95814
Phone: (916) 551-2849
E-Mail: nancy.park@bbklaw.com
If to Buyer: Mariners Church
Attn: Earl Robinson
5001 Newport Coast Drive
Irvine, CA 92603
Email: eroberson@marinerschurch.org
With a copy to: Allen Matkins Leck Gamble Mallory & Natsis LLP
Attn: Gary S. McKitterick, Esq.
2010 Main Street, 8th Floor
Irvine, CA 92614
Phone: (949) 851-5432
Email: gmckitterick@allenmatkins.com
To Escrow Holder: First American Title Insurance Company
Attn: Kelly Simoneau
3281 E. Guasti Road
Ontario, CA 91761
Phone: (909) 510-6206
Email: kiimoneau@firstam.com
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(c) Successors and Assigns. Buyer shall have the right to assign this Agreement
to any "person" "controlling" or "controlled" by Buyer without Seller's consent or approval (but
upon prior written notice to Seller) and no other right of assignment. Any such assignee shall
assume all obligations of Buyer hereunder; however, Buyer shall remain liable for all obligations
hereunder. Seller shall have the right to assign this Agreement. Except as otherwise permitted by
this paragraph, neither this Agreement nor the rights of either party hereunder may be assigned by
either party. Prior to any assignment, Buyer shall provide written certification and supporting
documentation reasonably acceptable to Seller evidencing that Buyer (or the applicable controlling
Person) possesses, directly or indirectly, an interest that confers control as defined herein,
including ownership or control of more than fifty percent (50%) of the voting or equity interests,
as provided in Section 21(c)(ii) below. This Agreement shall be binding upon, and inure to the
benefit of, the parties hereto and their respective successors, heirs, administrators and assigns.
(i) "Person" means an individual, religious corporation, partnership,
limited partnership, trust, estate, association, corporation, limited liability company, joint venture,
firm, joint stock company, unincorporated association, governmental authority, governmental
agency or other entity, domestic or foreign and shall include each and every member, partner,
owner, shareholder, creditor and investor in any of the foregoing entities.
(ii) "Controlling" or "Controlled", as used with respect to any Person,
means the possession, directly or indirectly (including through one or more intermediaries), of the
power to direct or cause the direction of the management and policies of such Person, including
through the ownership or control of voting securities, partnership interests, membership interests,
or other equity interests, acting as the manager of a limited liability company, or otherwise.
Without limiting the generality of the foregoing, it shall be a presumption that control with respect
to a corporation or limited liability company is the right to exercise, directly or indirectly, more
than fifty percent (50%) of the voting rights granted to all equity holders in the corporation or
limited liability company. It shall be a presumption that control with respect to other types of
entities such as a partnership, trust, other entity or association, is the possession by a Person,
indirectly or directly, of the power to direct or cause (by such Person's sole action) the direction
of the management or policies of the controlled entity.
(d) Amendments. No amendment, change, modification or supplement to this
Agreement shall be valid and binding on any of the Parties unless it is represented in writing and
signed by each of the Parties hereto. The Parties (with the City Manager or his or her designee
having delegated authority to act on behalf of the City) may by mutual written agreement (in the
Parties' respective sole discretion) update and substitute any updated Attachment for the
Attachment attached hereto as of the Effective Date, and such substitution shall be deemed an
administrative amendment of this Agreement. In addition, the City Manager is authorized, without
further approval of the City, to waive or modify any Seller closing conditions pursuant to Section 7
above or to make them conditions subsequent to the Closing under this Agreement. The provisions
of this Section do not modify or supersede the retention of authority set forth in Section 21(e)
bel ow_
(e) Action Taken. Following its approval by Seller, this Agreement shall be
administered by the Deputy City Manager — Real Property or any designee. Except where the
terms of this Agreement expressly require the approval of a matter or the taking of any action by
119600.00227/4914-2994-3635.2 -23-
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the City Council, any matter to be approved by the City shall be deemed approved, and any action
to be taken by the City shall be deemed taken, upon the written approval by the City Manager (or
designee). The City Manager or designee shall have the authority to issue interpretations with
respect to this Agreement and to determine whether any action requires the approval of the City
Council. All amendments or modifications of this Agreement shall require the approval of the
City Council. All waivers and extensions of time for performance under this Agreement shall be
approved by the City Manager (or designee) unless in the City Attorney's opinion such action
requires a waiver to be approved by the City Council under applicable law.
(f) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
(g) Construction. Headings at the beginning of each Section and subparagraph
are solely for the convenience of the parties and are not a part of the Agreement. This Agreement
shall not be construed as if it had been prepared by one of the parties, but rather as if both parties
had prepared the same. Unless otherwise indicated, all references to Sections and subparagraphs
are to this Agreement. All exhibits referred to in this Agreement are attached and incorporated by
this reference.
(h) No Joint Venture. This Agreement shall not create a partnership or joint
venture relationship between Buyer and Seller.
(i) Merger of Prior Agreements. This Agreement and the exhibits attached
hereto constitute the entire agreement between the parties and supersede all prior agreements and
understandings between the parties relating to the subject matter hereof, including without
limitation, any letters of intent previously executed or submitted by either or both of the parties
hereto, which shall be of no further force or effect upon execution of this Agreement.
0) Time of the Essence. Time is of the essence of this Agreement. As used in
this Agreement, a "business day" shall mean a day which is not a Saturday, Sunday or recognized
federal or state holiday. If the last date for performance by either party under this Agreement
occurs on a day which is not a business day, than the last date for such performance shall be
extended to the next occurring business day.
(k) Severability. If any provision of this Agreement, or the application thereof
to any person, place, or circumstance, shall be held by a court of competent jurisdiction to be
invalid, unenforceable or void, the remainder of this Agreement and such provisions as applied to
other persons, places and circumstances shall remain in full force and effect.
(1) Further Assurances. Each of the parties shall execute and deliver any and
all additional papers, documents and other assurances and shall do any and all acts and things
reasonably necessary in connection with the performance of their obligations hereunder and to
carry out the intent of the parties.
(m) Exhibits. All exhibits attached hereto and referred to herein are
incorporated herein as though set forth at length.
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(n) Captions. The captions appearing at the commencement of the sections and
paragraphs hereof are descriptive only and for convenience in reference. Should there be any
conflict between any such caption and the section at the head of which it appears, the section and
paragraph and not such caption shall control and govern in the construction of this Agreement.
(o) No Obligation To Third Parties. Execution and delivery of this Agreement
shall not be deemed to confer any rights upon, directly, indirectly or by way of subrogation, nor
obligate either of the parties hereto to, any person or entity other than each other.
(p) Waiver. The waiver by any party to this Agreement of the breach of any
provision of this Agreement shall not be deemed a continuing waiver or a waiver of any subsequent
breach, whether of the same or another provision of this Agreement.
(q) Interpretation. This Agreement has been negotiated at arm's length and
between persons (or their representatives) sophisticated and knowledgeable in the matters dealt
with in this Agreement. Accordingly, any rule of law (including California Civil Code § 1654 and
any successor statute) or legal decision that would require interpretation of any ambiguities against
the party that has drafted it is not applicable and is waived. The provisions of this Agreement shall
be interpreted in a reasonable manner to effect the purpose of the parties and this Agreement.
(r) Counterparts/Facsimile/.PDF Signatures. This Agreement may be executed
in counterparts and when so executed by the Parties, each of which shall be deemed an original,
but all of which together shall constitute one and the same instrument that shall be binding upon
the Parties, notwithstanding that the Parties may not be signatories to the same counterpart or
counterparts. The Parties may integrate their respective counterparts by attaching the signature
pages of each separate counterpart to a single counterpart. In order to expedite the transaction
contemplated herein, facsimile or .pdf signatures may be used in place of original signatures on
this Agreement. Seller and Buyer intend to be bound by the signatures on the facsimile or .pdf
document, are aware that the other party will rely on the facsimile or .pdf signatures, and hereby
waive any defenses to the enforcement of the terms of this Agreement based on the form of
signature.
(s) Authority. The execution and delivery of this Agreement have been duly
authorized and approved by all requisite action and the consummation of the transactions
contemplated have been duly authorized and approved by all requisite action of Buyer, and no
other authorizations or approvals will be necessary in order to enable Seller to enter into or to
comply with the terms of this Agreement. The person(s) signing this Agreement and any
documents and instruments in connection herewith on behalf of Buyer have full power and
authority to do so, and upon delivery to and execution by Seller this Agreement shall be a valid
and binding obligation of Buyer. The copies of the Buyer Authority Documents delivered under
Section 6(b) are true, correct and complete. Further, the Consent delivered to Buyer in accordance
with Section 6(b) hereof contains the approval of all owners, shareholders, officers, members and
directors of Buyer that is required under, in accordance with and pursuant to all of Buyer's
formation, organizational and governing documents.
(t) Force Majeure. A force majeure delay ("Force Majeure Delay") means
any delay in the performance of any non -monetary obligation under this Agreement caused by
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events beyond the reasonable control of the affected Party or its agents, contractors, or employees,
and not resulting from their own acts or omissions, which could not have been avoided through
commercially reasonable efforts. Qualifying events include acts of God, epidemics, pandemics,
natural disasters, fire, earthquake, unusually severe weather, war, terrorism, civil unrest, riots,
labor disputes, material shortages, freight embargoes, unforeseeable subsurface conditions or
hazardous materials, litigation seeking to enjoin or delay entitlements or construction, changes in
law (excluding those imposed by the City), and voter -approved measures that materially impair
performance. A Force Majeure Delay shall not include failure for a Party to obtain entitlements
or financing (except as affected by qualifying litigation), changes in market conditions, financial
inability to perform, financial market or economic crisis, failure to timely submit plans or
documentation, failure to maintain insurance, failure to execute documents, or foreseeable
governmental changes.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date
written below.
SELLER;
CITY OF TUSTIN.
a California municipal corporation
Date:
Attest:
Akio E. Schindler, City Manager
Erica N. Yasuda, City Clerk
Approved as to Form
City Attorney: I /�io���
Date. September 11,2025
Special Counsel: 1%
40-1-1
Michael Russo for Nancy Park
Date: September 11, 2025
BUYER:
MARINERS CHURCH,
a California non-profit religious corporation
By:
ames D. Franklin
Its: Cc, o
Date: 1. 11. 2y-LV—
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Acceptance by Escrow Holder
Escrow Holder acknowledges receipt of the foregoing Agreement and accepts the
instructions contained therein.
Dated: , 2025 American Title Insurance Company_
Kelly Simoneau, Escrow Officer
28
5 5905.0000 1 \43915269.9
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EXHIBIT A-1
LEGAL DESCRIPTION
Real property in the City of Tustin, County of Orange, State of California, described as Follows:
LOT 15, INCLUSIVE OF TRACT NO. 18197 AS SHOWN ON A MAP FILED IN BOOK 990, PAGES 25
THROUGH 33, INCLUSIVE OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA.
EYCEPTING THEREFROM ANY AND OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS
RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL
PRODUCTS DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE LAND,
TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN
AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO
WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAT THE LAND, OIL OR GAS
WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND AND TO
BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS, TUNNELS AND SHAFT$ UNDER
AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL, RE -TUN NEL, EQUIP,
MAINTAIN, REPAIR, DEEPEN AND OPERATED ANY SUCH WELL OR MINES; BUT WITHOUT, HOWEVER,
THE RIGHT TO DRILL, MINE, STORE, EXPLORE OR OPERATE THROUGH THE SURFACE OF THE LAND, AS
RESERVED IN THE DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED SEPTEMBER 24, 2002
AS INSTRUMENT NO. 20020819123 OP OFFICIAL RECORDS.
ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN
APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION
WITH OR WITH RESPECT TO THE LAND (NO MATTER HOW ACQUIRED BY THE GRANTOR), WHETHER
SUCH RIGHTS SHALL BE RIPARIAN, OVERLYING, APPROPRIATIVE, LITTORAL, PERCOLATING,
ADJUDICATED, STATUTORY OR CONTRACTUAL, TOGETHER W17H THE PERPETUAL RIGHT AND POWER
TO EXPLORE, DRILL, REDRY_L AND REMOVE THE SAME FROM OR IN THE LAND, TO STORE THE SAME
BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS
OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASE BY GRANTOR; BUT WITHOUT, HOWEVER,
ANY RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS,
AS RESERVED IN THE DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED SEPTEMBER 24,
2002 AS INSTRUMENT NO. 20020819173 OF OFFICIAL RECORDS-
APN: 430.481-13, 430-481-14 AND 430.481-15
55905.00001 \43915269.9
Docusign Envelope ID: 47B48E94-1B62-4DDC-B7B6-D9C96DFBBOD2
EXHIBIT A-2
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EXHIBIT B
FORM OF QUITCLAIM DEED
CITY OF TUSTIN OFFICIAL
BUSINESS REQUEST DOCUMENT
TO BE RECORDED AND TO BE
EXEMPT FROM RECORDING FEES
PER GOVERNMENT CODE §6103
AND §27383.
Recording requested by and when
recorded mail to:
City Manager
The City of Tustin
300 Centennial Way
Tustin, CA 92780
Mail Tax Statements to:
MARINERS CHURCH
SPACE ABOVE THIS LINE FOR RECORDER'S USE
QUITCLAIM DEED
[FOR PORTIONS OF DISPOSITION AREAS 8A AND COVENANTS, CONDITIONS
AND RESTRICTIONS, INCLUDING ENVIRONMENTAL RESTRICTION PURSUANT
TO CIVIL CODE SECTION 14711
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, this
Quitclaim Deed for Portions of Disposition Area 8A and Covenants, Conditions and Restrictions,
Including Environmental Restriction Pursuant to Civil Code Section 1471 ("Quitclaim Deed") is
made on this day of z 2025, by the CITY OF TUSTIN, California, a municipal
corporation of the State of California ("Grantor"), in favor of MARINERS CHURCH, a
California non-profit religious corporation ("Grantee"),
Grantor does hereby REMISE, RELEASE AND FOREVER QUITCLAIM to Grantee in
an "AS IS, WITH ALL FAULTS" condition that certain real property comprising approximately
3.324 acres of land in the City of Tustin, County of Orange, State of California, described in
Exhibit A attached hereto and by this reference incorporated herein (the "Property").
It is agreed by Grantor and Grantee and their successors and assigns that the conveyance
herein of the Property by this Quitclaim Deed is subject to the following:
4928-6439-2275, v. 1
Docusign Envelope ID: 47B48E94-1B62-4DDC-B7B6-D9C96DFBBOD2
1. This conveyance is subject to any and all existing leases, licenses, permits,
easements, encumbrances, and claims of record or apparent or of which Grantee has actual notice
which may affect the Property.
2. Grantor only grants to Grantee those rights in the Property which are owned by
Grantor. Grantor makes no representations or warranties, either express or implied, relating to the
nature or condition of the Property or Grantor's interest therein.
3. Grantor and the United States of America ("U.S. Government"), acting by or
through the Department of the Navy, conveyed property at the Marine Corps Air Station Tustin,
including the Property, to Grantor pursuant to that certain Quitclaim Deed D and Environmental
Restriction Pursuant to Civil Code Section 1471 dated May 13, 2002, that was recorded on May
14, 2002 in the office of the County Clerk Recorder for Orange County, California ("Official
Records") as Instrument Number 20020404594 and in Navy Quitclaim Deed G dated May 13,
2002 and recorded in the Orange County Clerk Recorder Office on May 14, 2002 as Instrument
No. 20020404597 ("U.S. Government Deeds"), which makes the Property subject to the U.S.
Government Deeds, including all restrictions therein on the use of the Property. Grantee, on behalf
of itself and its successors and assigns acquiring title to all or any portion of the Property and each
and every person claiming by, through or under Grantee or such successors or assigns, hereby
acknowledges and assumes all responsibilities placed upon Grantor in connection with the
Property under the terms of the U.S. Government Deeds.
4. Grantor and Grantee entered into that certain Purchase and Sale Agreement and
Joint Escrow Instructions for a portion of Disposition Area 8A (Tustin Legacy), dated as
of , 2025 (as the same may hereafter be further amended, modified or supplemented
in accordance with its terms, the "Agreement") providing for the sale of the Property subject to
this Quitclaim Deed, including (1) the SLA Covenant (as defined in the Agreement) for Portions
of Disposition Area 8A ("Special Restrictions") recorded , and (2) the
Declaration of Special Restrictions dated and recorded ("Use Covenant") as each has
been consented to by Grantee, each of which was recorded in the Official Records prior to the
recording of this Quitclaim Deed.
5. The Property is subject to the MCAS Tustin Reuse Plan adopted by the City
Council of the City on October 17, 1996, and amended in September 1998, as the same has been
subsequently amended ("Reuse Plan") and approved by the U.S. Government for MCAS Tustin.
6. Grantor and its successors and assigns together reserve the rights to, and to grant
and transfer to others, all or a portion of the following:
A. Any and all oil, oil rights, minerals, mineral rights, natural gas, natural gas
rights and other hydrocarbons by whatsoever name known, geothermal steam
and all products derived from any of the foregoing, that may be within or under
the Property together with the perpetual right of drilling, mining, exploring for
and storing in and removing the same from the Property or any other land,
including the right to whipstock or directionally drill and mine from lands other
than the Property, oil or gas wells, tunnels and shafts into, through or across the
4928-6439-2275, v. 1
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subsurface of the Property and to bottom such whipstocked or directionally
drilled wells, tunnels and shafts under and beneath or beyond the exterior limits
thereof, and to re -drill, re -tunnel, equip, maintain, repair, deepen and operate
any such well or mines; but without, however, the right to enter upon or use the
surface of the Property in the exercise of such rights or otherwise adversely
affect the use or operation of the Property as anticipated by the Agreement or
the structural integrity of any improvements on the Property.
B. Any and all water, water rights or interests therein appurtenant or relating to the
Property or owned or used by Grantor in connection with or with respect to the
Property no matter how acquired by Grantor, whether such water rights shall be
riparian, overlying, appropriative, littoral, percolating, prescriptive,
adjudicated, statutory or contractual, together with the perpetual right and
power to explore, drill, re -drill and remove the same from or in the Property, to
store the same beneath the surface of the Property and to divert or otherwise
utilize such water, rights or interests on any other property owned or leased by
Grantor; but without, however, the right to enter upon or use the surface of the
Property in the exercise of such rights or otherwise adversely affect the use or
operation of the Property as anticipated by the Agreement or the structural
integrity of any improvements on the Property.
C. Notwithstanding anything to the contrary set forth in this Quitclaim Deed, the
reservation by Grantor of the rights and interests in this Section 7 shall not be
deemed to limit Grantee's right to construct foundations, utilities and other
subsurface improvements and otherwise engage in subsurface construction
activity for the use of the Property for customary religious facilities. .
7. Grantee agrees to accept conveyance of the Property subject to all covenants,
conditions, restrictions, easements, rights -of -way, reservations, rights, agreements and
encumbrances of record, including, without limitation, the Agreement, SLA Covenant, U.S.
Government Deeds, Special Restrictions, and the Use Covenant, which are and shall be covenants
running with the land, shall not merge into this Quitclaim Deed and are and shall be binding upon
Grantee and all successors and assigns of Grantee owning all or any portion of Property for the
benefit of Grantor and its successors and assigns.
8. The terms of this Quitclaim Deed are hereby agreed and declared by Grantee and
Grantor to be covenants running with the land and enforceable as restrictions and equitable
servitudes against the Property, and are hereby declared to be and shall be binding upon and burden
the Property and Grantee and all successors and assigns of Grantee owning all or any portion of
the Property and all persons claiming by, through or under Grantee or such successor or assign for
the benefit of Grantor and Grantor and its governmental successors shall retain the right to enforce
the restrictions and equitable servitudes against the Property and the same shall be enforceable
solely by Grantor and its governmental successors.
{SIGNATURES ON NEXT PAGE)
4928-6439-2275, v. 1
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IN WITNESS WHEREOF, Grantor, THE CITY OF TUSTIN, has caused this Quitclaim Deed to
be executed on the day first above written.
CITY OF TUSTIN:
Dated: By:
Aldo E. Schindler
City Manager
ATTEST:
LOW
Erica N. Yasuda
City Clerk
APPROVED AS TO FORM
Woodruff & Smart, APC
IN
David E. Kendig
City Attorney
Best Best & Krieger LLP
Special Real Estate Counsel to the City
Nancy A. Park
(signatures continued on next page)
4928-6439-2275, v. 1
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ACKNOWLEDGEMENT OF GRANTEE'S COVENANTS
BY EXECUTING THIS QUITCLAIM DEED BELOW, ON AND AS OF THE DATE WRITTEN
BELOW, Grantee on behalf of itself and all subsequent owners of the Property or any portion
thereof and each and every person claiming by, through or under Grantee, on behalf of itself and
its successors and assigns acquiring fee title to all or any portion of the Property and each and
every person claiming by, through or under Grantee or such successors or assigns, hereby
acknowledges and accepts and agrees to be bound by this Quitclaim Deed and the covenants and
agreements of Grantee contained in this Quitclaim Deed.
MARINERS CHURCH,
A CALIFORNIA NON-PROFIT RELIGIOUS CORPORATION
BY: rEXHIBIT ONLY -DO NOT EXECUTE UNTIL
CONVEYANCEI
NAME:
TITLE:
Dated:
(signatures continued on next page)
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ACKNOWLEDGEMENT OF GRANTEE'S COVENANTS
BY EXECUTING THIS QUITCLAIM DEED BELOW, ON AND AS OF THE DATE WRITTEN
BELOW, Grantee on behalf of itself and all subsequent owners of the Real Property or any portion
thereof and each and every Person claiming by, through or under Grantee, on behalf of itself and
its successors and assigns acquiring fee title to all or any portion of the Real Property and each and
every Person claiming by, through or under Grantee or such successors or assigns, hereby
acknowledges and accepts and agrees to be bound by this Quitclaim Deed and the covenants and
agreements of Grantee contained in this Quitclaim Deed.
MARINERS CHURCH,
A CALIFORNIA NON-PROFIT RELIGIOUS CORPORATION
BY: rEXHIBIT ONLY -DO NOT EXECUTE
NAME:
TITLE:
Dated:
5 5905.0000 1 \43915269.9
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CALIFORNIA ALL PURPOSE ACKNOWLEDGEMENT
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of
On before me, ,
Date (Insert Name and Title of the Officer)
personally appeared
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Place Notary Seal and/or Stamp above Signature:
Signature of Notary Public
5 5905.0000 1 \43915269.9
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CALIFORNIA ALL PURPOSE ACKNOWLEDGEMENT
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of
On before me, ,
Date (Insert Name and Title of the Officer)
personally appeared
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Place Notary Seal and/or Stamp above Signature:
Signature of Notary Public
5 5905.0000 1 \43915269.9
Docusign Envelope ID: 47B48E94-1B62-4DDC-B7B6-D9C96DFBBOD2
CALIFORNIA ALL PURPOSE ACKNOWLEDGEMENT
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of
On before me, ,
Date (Insert Name and Title of the Officer)
personally appeared
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Place Notary Seal and/or Stamp above Signature:
Signature of Notary Public
5 5905.0000 1 \43915269.9
Docusign Envelope ID: 47B48E94-lB62-4DDC-B7B6-D9C96DFBBOD2
EXHIBIT A
LEGAL DESCRIPTION OF REAL PROPERTY
Real property in the City of Tustin, County of Orange, State of California, described as fcllows:
LOT 1S, INCLUSIVE OF TRACT NO. 18197 AS SHOWN ON A MAP FILED IN BOOK 990, PAGES 2S
THROUGH 33, INCLUSIVE OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA.
EXCEPTING THEREFROM ANY AND OIL, OIL RIGHTS, MINERALS, MINERAL RIGHTS, NATURAL GAS
RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL
PRODUCTS DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE LANE),
TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN
AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO
WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAT THE LAND, OIL OR GAS
WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND AND TO
BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS, TUNNELS AND SHAFTS UNDER
AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL, RE -TUNNEL, EQUIP,
MAINTAIN, REPAIR, DEEPEN AND OPERATED ANY SUCH WELL OR MINES; BUT WITHOUT, HOWEVER,
THE RIGHT TO DRILL, MINE, STORE, EXPLORE OR OPERATE THROUGH THE SURFACE OF THE LAND, A5
RESERVED IN THE DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED SEPTEMBER 24, 2002
AS INSTRUMENT NO. 20020819173 OF OFFICIAL RECORDS.
ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN
APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION
WITH OR WITH RESPECT TO THE LAND (NO MATTER HOW ACQUIRED BY THE GRANTOR), WHETHER
SUCH RIGHTS SHALL BE RIPARIAN, OVERLYING, APPROPRIATIVE, LITTORAL, PERCOLATING,
ADJUDICATED, STATUTORY OR CONTRACTUAL, TOGETHER WITH THE PERPETUAL RIGHT AND POWER
TO EXPLORE, DRILL, REDRY--L AND REMOVE THE SAME FROM OR IN THE LAND, TO STORE THE SAME
BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS
OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASE BY GRANTOR; BUT WITHOUT, HOWEVER,
ANY RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS,
AS RESERVED IN THE DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED SEPTEMBER 24,
2002 AS INSTRUMENT NO. 20020819173 OF OFFICIAL RECORDS.
APN: 430-481-13, 430-481-14 AND 430-481-15
55905.00001 \43915269.9
Docusign Envelope ID: 47B48E94-lB62-4DDC-B7B6-D9C96DFBBOD2
EXHIBIT B
DESCRIPTION OF THE REMEDIAL ACTION TAKEN BY THE GOVERNMENT
{see attached)
55905.00001 \43915269.9
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EXHIBIT C
COVENANT
CITY OF TUSTIN OFFICIAL BUSINESS REQUEST
DOCUMENT TO BE RECORDED AND TO BE
EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE 6103 AND 27383.
Recording requested by and
when recorded mail to:
City of Tustin
300 Centennial Way
Tustin, CA 92780
Attn: Citv Manaeer
SPACE ABOVE THIS LINE FOR RECORDER'S USE
DECLARATION OF SPECIAL RESTRICTIONS
This DECLARATION OF SPECIAL RESTRICTIONS (this "Declaration"), is made as of
, 20_ (the "Restrictions Date") by CITY OF TUSTIN, a municipal corporation
of the State of California (the "City"), and is acknowledged by MARINERS CHURCH, a
California non-profit religious corporation ("Mariners") who agree as follows:
1. Tustin Legacy. In May 2002, the Navy and the City entered into that certain
Agreement Between the United States of America and the City of Tustin, California for
the Conveyance of a Portion of the Former Marine Corps Air Station Tustin dated as of
May 13, 2002 ("Memorandum of Agreement"), pursuant to which the Navy agreed to
convey approximately 1,153 acres of MCAS Tustin to the City. The 1,153 acres of MCAS
Tustin located within the City of Tustin either conveyed by the Navy to the City or subject
to ground lease between the Navy and the City is referred to in this Declaration as "Tustin
Legacy."
2. Property Acquisition. On or about the Restrictions Date, Mariners has
acquired the Property (as defined below) from City pursuant to that certain Purchase and
Sale Agreement and Joint Escrow Instructions dated as of , 2025 (the
"Purchase Agreement"). The "Property" is commonly referred to as Assessor's Parcel
Numbers 430-481-13, 430-481-14, and 430-481-15) and is further described in Exhibit A
attached hereto.
3. Project Purpose. Upon acquisition of the Property, Mariners has agreed to
develop the Property for religious facility purposes subject to the Use Covenant described
55905.00001 \43915269.9
Docusign Envelope ID: 47B48E94-1B62-4DDC-B7B6-D9C96DFBBOD2
in Section 4 below. ("Project")
4. Use Covenants and Restrictions. From and after the recording of the deed
transferring title to the Property to Mariners, and the recording of this Covenant, Mariners
agrees that the Property shall be used solely for religious facility purposes. No other use
shall be permitted without the prior written approval of the City of Tustin, which may be
granted or withheld in the City's sole and absolute discretion (the "Use Covenant"). The
City desires to impose on the Property the Use Covenant, subject to the terms of this
Declaration and the Purchase Agreement. This Declaration also sets forth those rights of
the City and certain obligations of Mariners and its successor owners and assigns, specified
in the Purchase Agreement which shall remain in full force and effect for the applicable
term specified herein. Mariners and its successor owners and assigns shall be required to
hold and convey title to the Property subject to this Declaration.
5. Effect After Sale. The City hereby covenants and declares that the Property
is now held and, to the specific extent and subject to the limitations more specifically set
forth herein, shall hereafter be held, transferred, conveyed, sold, leased, subleased,
encumbered, mortgaged, used, occupied and improved subject to the covenants, conditions
and restrictions herein set forth, each and all of which is and are for the purpose of the Use
Covenant.
6. Term. The covenants, conditions, and restrictions, including the Use
Covenant, contained in this Declaration shall commence as of the Restrictions Date and
shall remain in full force and effect in perpetuity, unless and until released or modified by
a recorded written instrument executed by the City and duly recorded in the Official
Records of Orange County, California.
7. Covenants Run with the Land. The covenants, conditions and restrictions
set forth in this Declaration shall run with the Property and are hereby declared to (a) inure
to the benefit of and pass with, the Property and every portion of or interest in the Project
for the benefit of the Property and City and its governmental successors, (b) in accordance
with the provisions of these Restrictions shall be binding upon Mariners and each successor
owner and assign, claiming by through or under Mariners or any successor owner or
assign, and (c) be enforceable as restrictions and equitable servitudes against the Property.
8. Violation of Use Covenant, Enforcement. If Mariners or any successor
violates the Use Covenant, in City's sole discretion, the City shall provide written notice
to Mariners or its successor -in -interest specifying the nature of the violation. If the
violation is not cured within 30 daysor, if it requires more time, if corrective action is
not promptly begun and diligently pursued —the City shall have the right but not the
obligation to pursue any legal or equitable remedy. These restrictions run with the land and
remain enforceable by the City and its governmental successors. No private right of
2
5 5905.0000 1 \43915269.9
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enforcement is created by this Declaration. The restrictions do not merge into any deed and
shall remain in effect unless released in writing by the City.
9. Mariners Indemnity Obligations. To the fullest extent permitted by law,
Mariners and its successors and assigns shall indemnify, defend, and hold harmless the
City and its officers, employees, agents, and governmental successors (collectively, the
"Indemnitees") from and against any and all claims, liabilities, losses, damages, demands,
actions, causes of action, costs, and expenses (including reasonable attorneys' fees and
costs) arising out of or relating to (a) any breach of this Declaration by Mariners or its
successors. This obligation shall survive the termination of this Declaration and any
transfer of the Property.
10. Principles of Interpretation. No inference in favor of or against any Party
shall be drawn from the fact that such Party has drafted any part of this Covenant. The
Parties have both participated substantially in the negotiation, drafting, and revision of this
Covenant, with advice from legal counsel and other advisers of their own selection.
11. Amendment. This Declaration may only be amended or terminated by a
written instrument executed by the City and recorded in the Official Records of Orange
County, California. No oral statements or prior agreements shall modify or waive any
provisions herein.
12. Severability. If any provision of this Declaration is held to be invalid or
unenforceable by a court of competent jurisdiction, the remaining provisions shall remain
in full force and effect.
13. No Waiver. The City's failure to enforce any provision of this Declaration
shall not be deemed a waiver of its right to enforce that or any other provision at any time
in the future.
14. Governing Law and Venue. This Declaration shall be governed by and
construed in accordance with the laws of the State of California. Any legal action arising
from or relating to this Declaration shall be filed and maintained in the Superior Court of
Orange County, California.
15. No Third -Party Beneficiaries. This Declaration is for the benefit of the
City and its governmental successors only. No other person or entity shall have any rights
under this Declaration or may rely upon it.
16. Interpretation, Headings used in this Declaration are for convenience only
and shall not affect interpretation. This Declaration shall be construed as a whole and not
strictly for or against any party, regardless of who drafted it.
17. Attorneys' Fees. In any action or proceeding to enforce or interpret this
Declaration, including any claim for breach or default, the prevailing party shall be entitled
to recover its reasonable attorneys' fees and costs, including fees and costs incurred on
appeal and in enforcing any judgment.
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18. Notices. All notices or communications under this Declaration must be in
writing and will be considered given: (a) when personally delivered; (b) three (3) business
days after being sent by certified U.S. mail, return receipt requested; (c) the next business
day after being sent by an approved overnight delivery service with proof of delivery; or
(d) when emailed—provided a copy is also sent by another approved method or the
recipient confirms receipt in writing. Unless updated in writing, notices shall be sent to the
addresses listed below.
If to City: City of Tustin
City Manager
300 Centennial Way
Tustin, CA 92780
Attn: City Manager
Email: CityManager@tustinca.org
With a copy to: Deputy City Manager — Real Property
City of Tustin
300 Centennial Way
Tustin, CA 92780
Attn: Deputy City Manager — Real Property
Email: DCM-RP@tustinca.org
With a copy to: City Attorney
Woodruff, Spradlin & Smart
555 Anton Blvd., Suite 1200
Costa Mesa, CA 92626
Attention: David E. Kendig, Esq.
Email: dkendig@woodruff.law
With copy to: Best Best & Krieger LLP
Attn: Nancy Park
500 Capitol Mall, Suite 2500
Sacramento, CA 95814
Phone: (916) 551-2849
E-Mail: nancy.park@bbklaw.com
If to Mariners: Mariners Church
Attn: Earl Robinson
5001 Newport Coast Drive
Irvine, CA 92603
Email eroberson@marinerschurch.org
With a copy to: Allen Matkins Leck Gamble Mallory & Natsis LLP
Attn: Gary S. McKitterick
2010 Main Street, 8th Floor,
Irvine, CA 92614-7214
Phone: (949) 851-5432
E-Mail: gmckitterick@allenmatkins.com
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IN WITNESS WHEREOF, the City has executed this Declaration as of the date first set forth
above.
ATTEST:
Erica N. Yasuda
City Clerk
APPROVED AS TO FORM
David E. Kendig
City Attorney
"CITY"
CITY OF TUSTIN,
a California municipal corporation
By: (exhibit only -do not execute]
Aldo E. Schindler
City Manager
(signatures continued on next page)
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MARINERS ACKNOWLEDGEMENT
BY EXECUTING THIS DECLARATION OF SPECIAL RESTRICTIONS FOR THE
PROPERTY, Mariners, on behalf of itself and all subsequent owners of the Property or any portion
thereof and each and every person claiming by, through or under Mariners or any such successor
owners hereby acknowledges and agrees that, upon obtaining title to the Property, Mariners hereby
assumes and agrees, on behalf of itself, each successor owner, and every person claiming by,
through or under Mariners or any successor owner or assign, to be bound by all of the obligations
of the Declaration and all liabilities, covenants, conditions, and restrictions therein.
MARINERS CHURCH,
a California non-profit religious corporation
By: f exhibit only -do not execute]
Name:
Title:
Dated:
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CALIFORNIA ALL PURPOSE ACKNOWLEDGEMENT
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of
On before me,
Date (Insert Name and Title of the Officer)
personally appeared
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:
Signature of Notary Public Place Notary Seal and/or Stamp above
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CALIFORNIA ALL PURPOSE ACKNOWLEDGEMENT
A notary public or other officer completing this certificate verifies only the identity of the
individual who signed the document to which this certificate is attached, and not the
truthfulness, accuracy, or validity of that document.
State of California
County of
On
before me,
Date (Insert Name and Title of the Officer)
personally appeared
Name(s) of Signer(s)
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument
the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature:
Signature of Notary Public
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Place Notary Seal and/or Stamp above
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EXHIBIT A
LEGAL DESCRIPTION OF PROPERTY
The Property referred to herein below is situated in the City of Tustin, County of Orange, State of
California, and is described as follows:
Real property in the City of Tustin, County of Orange, State of California, described as follows:
LOT 1S, INCLUSIVE OF TRACT NO. 18197 AS SHOWN ON A MAP FILED IN BOOK 990, PAGES 2S
THROUGH 33, INCLUSIVE OF TRACT MAPS, RECORDS OF ORANGE COUNTY, CALIFORNIA.
EXCEPTING THEREFROM ANY AND OIL, 0IL RIGHTS, MINERAL$, MINERAL RIGHTS, NATURAL GAS
RIGHTS AND OTHER HYDROCARBONS BY WHATSOEVER NAME KNOWN, GEOTHERMAL STEAM AND ALL
PRODUCTS DERIVED FROM ANY OF THE FOREGOING, THAT MAY BE WITHIN OR UNDER THE LAND,
TOGETHER WITH THE PERPETUAL RIGHT OF DRILLING, MINING, EXPLORING FOR AND STORING IN
AND REMOVING THE SAME FROM THE LAND OR ANY OTHER LAND, INCLUDING THE RIGHT TO
WHIPSTOCK OR DIRECTIONALLY DRILL AND MINE FROM LANDS OTHER THAT THE LAND, OIL OR GAS
WELLS, TUNNELS AND SHAFTS INTO, THROUGH OR ACROSS THE SUBSURFACE OF THE LAND AND TO
BOTTOM SUCH WHIPSTOCKED OR DIRECTIONALLY DRILLED WELLS, TUNNELS AND SHAFTS UNDER
AND BENEATH OR BEYOND THE EXTERIOR LIMITS THEREOF, AND TO REDRILL, RETUNN EL, EQUIP,
MAINTAIN, REPAIR, DEEPEN AND OPERATED ANY SUCH WELL OR MINES; BUT WITHOUT, HOWEVER,
THE RIGHT TO DRILL, MINE, STORE, EXPLORE OR OPERATE THROUGH THE SURFACE OF THE LAND, AS
RESERVED IN THE DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED SEPTEMBER 24, 2002
AS INSTRUMENT NO. 20020819173 OF OFFICIAL RECORDS.
ALSO EXCEPTING THEREFROM ANY AND ALL WATER, WATER RIGHTS OR INTERESTS THEREIN
APPURTENANT OR RELATING TO THE LAND OR OWNED OR USED BY THE GRANTOR IN CONNECTION
WITH OR WITH RESPECT TO THE LAND (NO MATTER HOW ACQUIRED BY THE GRANTOR), WHETHER
SUCH RIGHTS SHALL BE RIPARIAN, OVERLYING, APPROPRIATIVE, LITTORAL, PERCOLATING,
ADJUDICATED, STATUTORY OR CONTRACTUAL, TOGETHER WITH THE PERPETUAL RIGHT AND POWER
TO EXPLORE, DRILL, REDRY-L AND REMOVE THE SAME FROM OR IN THE LAND, TO STORE THE SAME
BENEATH THE SURFACE OF THE LAND AND TO DIVERT OR OTHERWISE UTILIZE SUCH WATER, RIGHTS
OR INTERESTS ON ANY OTHER PROPERTY OWNED OR LEASE BY GRANTOR; BUT WITHOUT, HOWEVER,
ANY RIGHT TO ENTER UPON OR USE THE SURFACE OF THE LAND IN THE EXERCISE OF SUCH RIGHTS,
AS RESERVED IN THE DEED FROM THE CITY OF TUSTIN, CALIFORNIA, RECORDED SEPTEMBER 2-1,
2002 AS INSTRUMENT NO. 20020819173 Or OFFICIAL RECORDS.
APN: 430-481-13, 430-481-14 AND 430-481-15
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EXHIBIT D
TRANSFEROR'S CERTIFICATION OF NON -FOREIGN STATUS
This form is provided so that the Buyer and/or Seller in this transaction can certify compliance
with the Foreign Investment in Real Property Tax Act to the Escrow Agent and/or MARINERS
CHURCH, a California non-profit religious corporation ("Transferee"). Transferee must retain
a copy of this document until after the fifth taxable year following the transfer.
Section 1445 of the Internal Revenue Code of 1986, as amended ("Code") provides that a
transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person.
For U.S. tax purposes (including section 1445), the owner of a disregarded entity (which has legal
title to a U.S. real property interest under local law) will be the transferor of the property and not
the disregarded entity. To inform Transferee that withholding of tax is not required upon the
disposition of a U.S. real property interest, the undersigned hereby certifies the following on behalf
of the CITY OF TUSTIN, a California municipal corporation ("Transferor"):
1. The Transferor is not a foreign corporation, foreign partnership, foreign trust, foreign estate
or foreign person (as those terms are defined in the Code and the Income Tax Regulations
promulgated thereunder).
2. The Transferor is not a disregarded entity as defined in Income Tax Regulation
Section 1.1445-2(b)(2)(iii).
3. The Transferor's U.S. employer or tax identification number is
4. The Transferor's office address is
The Transferor understands that this Certification may be disclosed to the Internal Revenue Service
by the Transferee and that any false statement contained herein could be punished by fine,
imprisonment, or both.
Under penalties of perjury I declare that I have examined this Certification and to the best of my
knowledge and belief it is true, correct and complete, and I further declare that I have authority to
sign this document on behalf of the Transferor.
Date: .2025 TRANSFEROR:
CITY OF TUSTIN,
a California municipal corporation
By: (exhibit only -do not execute]
Name:
Its:
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EXHIBIT E
SELLER DELIVERIES
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EXHIBIT F
INTENTIONALLY OMITTED
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EXHIBIT G
INSURANCE REQUIREMENTS
Without limiting the Seller's rights to indemnification, Buyer shall procure and maintain
or cause to be procured and maintained, at its own cost and expense, and furnish or cause to be
furnished to Seller, evidence of the following policies of insurance (complying with the
requirements set forth below) naming Buyer as insured and include as additional insureds Seller
and the Seller's additional insureds specified below. Unless otherwise specified below, all
insurance required below shall be in place or obtained by Buyer upon the date specified below.
Subject to the provisions of this Exhibit G, the insurance obligations under this Agreement shall
be the minimum insurance coverage requirements and/or limits shown in this Exhibit G. No
representation is made that the minimum insurance requirements of this Agreement are sufficient
to cover the obligations of Buyer, as applicable, under this Agreement.
A. Liability Insurance. Commencing upon the Effective Date, Buyer shall
maintain or cause to be maintained commercial general liability insurance and automobile liability
insurance, to protect against insurable loss from liability imposed by law for damages on account
of personal injury, including death therefrom, suffered or alleged to be suffered by any Person or
Persons whomsoever on or about the Property and the business of Buyer on the Property, or in
connection with the operation thereof, resulting directly or indirectly from any acts or activities of
Buyer or anyone directly or indirectly employed or contracted with or acting for Buyer, or under
its respective control or direction, and also to protect against loss from liability imposed by law
for damages to any property of any Person occurring on or about the Property and/or the business
of Buyer on the Property, or in connection with the operation thereof, caused directly or indirectly
by or from acts or activities of Buyer or any Person acting for Buyer, or under its control or
direction. Such insurance shall also provide for and protect the Seller against incurring any legal
cost (of legal counsel acceptable to Buyer's insurer(s)) in defending Claims for alleged loss. Such
insurance shall be maintained in full force and effect and for so long thereafter as necessary to
cover any claims of damages suffered by persons or property resulting from any acts or omissions
of Buyer, Buyer's employees, agents, contractors, suppliers, consultants or other related parties.
The amount of insurance required shall include comprehensive general liability and personal injury
with limits of at least Ten Million Dollars ($10,000,000.00) each occurrence and annual policy
aggregate and automobile liability with limits of at least Five Million Dollars ($5,000,000.00)
combined single limit per occurrence. The insurance shall be issued by a company authorized by
the Insurance Department of the state of California to do business in California and rated A-NII
or better by the latest edition of Best's Key Rating Guide (`Best's"). Such insurance may be
provided in part by an umbrella or excess insurance policy meeting the requirements of this Section
A, including_the endorsements set forth in the following paragraph.
a. ACORD certificates and endorsements signed by authorized
representative(s) of the underwriter (or copies of the applicable pages from the
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policy if the applicable endorsement coverage is part of the policy rather than
provided by separate endorsement) and reasonably approved by the Seller shall be
delivered as soon as reasonably possible upon execution of the Agreement but in
no event later than prior to access by Buyer or Buyers Representatives upon the
Property pursuant to Section 5 of the Agreement. The endorsements shall provide
as follows: (i) designate "the City of Tustin and the Successor Agency to the Tustin
Community Redevelopment Agency and their respective elected and appointed
officials, agents, representatives and employees", as additional insureds on the
commercial general liability policies and automobile liability policies; (ii) the
commercial general liability and automobile liability insurance coverages shall be
primary, and not contribute with any insurance maintained by the City; and (iii) a
waiver of subrogation for the benefit of "the City of Tustin and the Successor
Agency to the Tustin Community Redevelopment Agency and their respective
elected and appointed officials, agents, representatives and employees". "Blanket"
endorsements (or coverage within the policy itself) providing the same protection
as required by written contract shall be acceptable to Seller. The procuring of such
insurance and the delivery of policies, certificates or endorsements evidencing the
same shall not be construed as a limitation of Buyer's obligation to indemnify Seller
as set forth in this Agreement.
B. Workers' Compensation Insurance. Commencing upon the Effective Date, in the
event the Buyer has employees, Buyer shall obtain, and thereafter maintain or cause to be
maintained, workers' compensation insurance issued by a responsible carrier authorized under the
laws of California to insure employers against liability for compensation under the workers'
compensation laws now in force in California, or any laws hereafter enacted as an amendment or
supplement thereto or in lieu thereof. Such workers' compensation insurance shall cover all
Persons employed by Buyer and shall cover liability within statutory limits for compensation under
any such act aforesaid, based upon death or bodily injury claims made by, for or on behalf of any
employee of Buyer incurring or suffering injury or death. Notwithstanding the foregoing, Buyer
may, in compliance with the laws of California and in lieu of maintaining such insurance, self -
insure for workers' compensation in which event Buyer shall deliver to Seller evidence that such
self-insurance has been approved by the appropriate State authorities. Buyer shall also furnish (or
cause to be furnished) to Seller evidence satisfactory to Buyer that any contractor with whom it
has contracted for performance of work on the Property or otherwise pursuant to this Agreement
carries workers' compensation insurance required by law. Policies or an ACORD certificate of
insurance may be provided as evidence of the existence of insurance policies and their limits, but
actual endorsements (or copies of the applicable pages from the policy if the coverage is part of
the policy) are required to be provided to Seller to evidence that each endorsement requirement
has been satisfied. The insurance policy(ies), by endorsement signed by an authorized
representative of the underwriter(s), shall contain a waiver of subrogation for the benefit of the
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following additional insureds: "the City of Tustin and the Successor Agency to the Tustin
Community Redevelopment Agency, and their respective elected and appointed officials, agents,
representatives and employees". A "blanket" endorsement providing the same protection as
required by written contract shall be acceptable to Seller. The insurance provided for under this
Section B shall be issued by a company rated B-/VIII or better by Best's or from the state of
California Compensation Fund.
C. General Insurance Requirements.
For all policies or certificates, the insurer endorsements (or a copy of the policy
binder, if applicable) shall specifically identify the address and shall provide evidence that Buyer
has paid for its premium in full for any policy that is currently in place. Buyer's insurance broker
shall confirm in writing that premium payments are in compliance with the insurance policy(ies)
payment terms.
All insurance provided under this Section C shall be for the benefit of the parties.
Buyer shall: (A) timely pay all premiums for such insurance and, at its sole cost and expense, to
comply and secure compliance with all insurance requirements necessary for the maintenance of
such insurance, and (B) with respect to liability insurance and workers compensation insurance
coverage required, to submit certificates evidencing such insurance to Seller on an ACORD form
following City Council approval of this Agreement. Within seven (7) Business Days, if
practicable, after expiration of any such policy, certificates evidencing renewal policies (and all
required endorsements) shall be submitted to Seller, together with evidence of compliance with
insurance policy(ies) premium payment terms.
If Buyer fails to procure and maintain insurance as required by this Agreement,
Seller shall have the right, at Seller's election, and upon ten (10) Business Days' prior written
notice to Buyer, to procure and maintain such insurance. The premiums paid by Seller shall be
treated as a loan, due from Buyer, to be paid on the first calendar day of the month following the
date on which the premiums were paid and such cost, until paid, shall constitute a lien on the
Property and improvements thereon. Seller shall give prompt notice of the payment of such
premiums, stating the amounts paid and the name of the insured(s).
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