October 7, 2020- Executive Session Directors Report

October 7, 2020- Executive Session Directors Report

Directors Report

Executive Session

October 7 , 2020

MEETING OF THE BOARD OF DIRECTORS THURSDAY, OCTOBER 7, 2020 VIRTUAL (Video/Phone) AGENDA (Board Version) EXECUTIVE SESSION – 10 A.M. PT

Executive Sessions are provided by statute (Civil Code §4935) so Boards can address issues involving Privileged Information and matters of a Private Nature. As a result, Owners do not have a right to attend Executive Sessions. I. CALL TO ORDER A. Minutes – September 21, 2020 B. Legal 1. ES Kitchen Health Permit C. Contracts 1. Roma Coffee Café 2. Lupe’s Salon 3. CVWD Property/Dog Park 4. Strategic Plan D. Personnel 1. Lifestyle Office – Saturday Staffing 2. Planning Committee E. Member Delinquencies/Discipline 1. Delinquent Assessment Report F. General Manager Report on Past/Future Confidential Matters XII. ADJOURNMENT

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October 7, 2020 Minutes A. Minutes- September 21, 2020

Meeting of the Board of Directors Thursday September 21, 2020 Virtual (Webinar/Phone) Minutes

Present

Greg Farmer, President Don Renoe, Vice President Charlie Leahy, Treasurer

Mike Barber, Secretary John Boudin, Director Charles Hare, Director Also Present: Ed Vitrano, General Manager Jennifer Miranda, Resort Services Manager & Executive Assistant to the Board & General Manager Kristine Gonzalez- Controller 45 Webinar Participants Call to Order

Meeting called to order by President Greg Farmer at 1:04 pm PT. Presidents Report

A. Opening Remarks 1. President Farmer thanked the five Owners who came forward and expressed interest in being on the Board. 2. President Farmer spoke about the beginning of season with COVID. B. Approval of Agenda Motion- Treasurer Hare Second- Vice President Renoe Approved Unanimously C. Executive Session Actions 1. Contracts with Realtors are varied, complex and the processes involved in them are complex and we have inconsistencies.

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The Board decided to create an Ad Hoc Committee with Director Leahy as the chair. Director Leahy will give an update at the October 19 Board Meeting. 2. ORPS name and usage that may reflect negatively towards the Association. The Board directed Management to contact those sites and ask to place a disclaimer on them that they are not officially representing Outdoor Resorts.

Treasurer’s Report & Ratification

A. Financial Statement – July 30 & August 31, 2020

Financial statements for July & August have been reviewed by Treasurer Hare, President Farmer, and Director Leahy. Revenues & Expenses are on target except for Utilities due to extreme heat and both clubhouses being open. A Motion was made by Treasurer Hare for the Board to ratify the review of the July & August financials. Second- Vice President Renoe Approved Unanimously

Secretary’s Report

Secretary Barber received minimal emails concerning short term rentals, laundry facility usage and COVID related questions going into the season. General Manager’s Report A. Community Standards/ A&A B. Maintenance 1. GM Vitrano reviewed the projects included in the Maintenance Report . C. Security 1 . GM Vitrano reported on two rig fires this summer. In each situation the source leads back to the refrigerator as the cause of the fire. 2. GM Vitrano reported two vehicle thefts within the last 30 days. Each instance has inconsistent details and lack of information surrounding each situation. No specific details are available. D. Landscape Scalping will start September 27, 2020. Irrigation will be turned off from September 25, 2020- October 5, 2020. Committee Reports

None

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Consent Agenda

A. Minutes Approval B. 2019/2020 Audit Review & Acceptance Motion to Approve Consent Agenda: Vice President Renoe

Second: Director Boudin Approved: Unanimously

Unfinished Business

A. Board Vacancy – Appointment Action 1. There were five Owners who submitted a statement of intent to be considered for a position on the Board of Directors.

a. Jack Delperdang b. Kathy McCune c. Kristen Damazio d. Shauna Riley e. Paul Bracconier By majority vote Kathy McCune is hereby appointed to the Board of Directors. New Business

A. RV Cover Rules- COVID Related

1. President Farmer reviewed the rule of RV covers and numerous owner requests for extensions and exceptions to the rule. a. A motion was made by Treasurer Hare to suspend the rule until November 15, 2021. The motion did not get a second. b. A motion was made by Director Boudin to suspend the RV Cover rule until January 4, 2020 and to allow RV covers to be temporarily stored under the rig. The suspension of the rule will be reviewed again at the December 21, 2020 Board Meeting. Second: Secretary Barber Approved 5 to 1 (Vice President Renoe- No) B. Espresso Bar Contract- Termination & Award 1. A motion was made by President Farmer to approve the termination of the Espresso Bar contract and award the McDougall’s $1,500 which consists of good will and equipment, in recognition of their 18 years of service. Second: Vice President Renoe Approved: Unanimously

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2. A motion was made by Vice President Renoe to engage Richard Camacho, of TACOOK Enterprises, the concessionaire of Bella Roma at the La Palma Café, and amend the contract to include the operation of a “Coffee Café”. Second: Treasurer Hare Approved Unanimously C. ES Kitchen Use Limitation- COVID Related 1. President Farmer reported on the evolution of the ES Kitchen and discussed the use of the kitchen this upcoming season due to COVID and increased Health department oversight. a. A motion was made by Vice President Renoe and a second was made by Secretary Barber to close the ES kitchen to residents for personal use and to ask Richard Camacho, current concessionaire of Bella Roma at the La Palma Café, to supervise the operation of the ES kitchen, allowing for Lifestyle sponsored events. After additional discussion, the motion was withdrawn. b. A motion was made by Director Boudin and a second was made by Director Leahy, to strike the sentence in 1F-1 from the rules & regulations rule 1.F - La Palma and El Saguaro Kitchens, that states that the use of the kitchens is for Owner use only by prox cards that are not transferrable. After additional discussion, that motion was also withdrawn. The Board directed Management to come forth with a first reading of the change of the rules as to deactivation of the prox card access at the kitchen. The revision will be presented at the next Board Meeting. Discussion A. COVID 19 Impact on Season Preparedness 1. GM Vitrano reported on the importance of personal responsibility of owners to wear masks, social distance, and wash hands. Management will not be the enforcers unless the situation requires additional intervention for compliance. 2. Lifestyle Director Torres reported on the events that are planned for the upcoming season while adhering to the guidelines set forth by the County of Riverside. The Bar will be open with appetizers being served. Events are currently planned to be held outdoors with a maximum of 100 people, to adhere with the County of Riversides current guidelines. Open Forum • Ray Sterbens Lot 332- Commented on police presence and dog relief area survey. • Marilyn Sabens Lot 363& 1056- Expressed concerns of exclusive use of meeting rooms. • Darcey Deetz Lot 854 & 969- Commented on Resort Security and owner/member reference. • Kristen Damazio Lot 914- Comments on Lifestyle & Events. • Robin Polson Lot 556- Questions about new Board Member, minutes and zoom meetings. Adjournment

Meeting adjourned at 3:30 pm (PT)

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Next Virtual/In-Person Board Meeting- October 19, 2020- 1:00 pm (PT) – La Palma Clubhouse

Respectfully Submitted: _______________________________

___________

Mike Barber, Secretary

Date

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October 7, 2020 Legal A. ES Kitchen HealthPermit

OUTDOOR RESORT - PALM SPRINGS OWNER’S ASSOCIATION BOARD OF DIRECTORS STAFF REPORT

Executive Meeting Date:

October 7, 2020

New

Unfinished

Discussion

Consent Agenda

Executive Session X

Agenda Item:

ES Kitchen Health Permit

Description:

Possibility of ORPS Operation

Submitted By:

Ed Vitrano, General Manager

Date: October 5, 2020

Background: The best laid plans and agenda planning . . . this report has taken a different turn since receiving Byron’s email, which is attached. In our discussion with Richard Camacho, of Bella Roma, regarding his “management” of the ES Kitchen, he indicated that he was uncomfortable with others using it under his permit, particularly when he was not present. Byron and I then thought it might be best for ORPS to get its own permit. Then came Byron’s email, which is not promising. On a positive side, Richard is willing to assist the Resort with a Mon-Fri, 5-7 p.m. “heavy hors d’oeuvures” menu so that the bar can be open and is also willing to create specials to coincide with the Lifestyle themes such as “Taco Tuesdays, Wednesday Burgers, etc.” With the latest info from the County, I suggest that the idea of an ORPS Health Permit be dropped. For Consideration: None suggested. Designated Funding: N/A

Board Action:

Jennifer Miranda Subject:

FW: ES Kitchen

From: Byron Jessie Sent: Monday, October 5, 2020 2:19 PM To: Edwin Vitrano Subject: ES Kitchen Hi Ed,

After talking to Edina at the county she said the following:

If we permit the kitchen no one can use it except those who have a food handlers certification and cards which means that the owners would be prohibited. We do have a grease interceptor there but the county may make us install a floor drain at the cook line that empties into the grease interceptor and they may make us change the wooden pantry door. The county would have to do an initial inspection of the kitchen and based on their recommendations we may have to have plans drawn up and approved by the city and county. Also, if Richard prepares food for the coffee cafe and packages it in the kitchen he may not need to put a 3 rd sink in the espresso bar. Edina needed to verify this with her supervisor though. As the kitchen now stands, without a permit, Owners could use it for personal use as well as caterers they may use for a private event, using the caterers license. Richard could use it, for preparing for Mon ‐ Fri assistance to ORPS under his permit as well.

Thanks

Byron Jessie Facility Manager Outdoor Resort Palm Springs 69411 Ramon Road Cathedral City, CA 92234 ______________________ Toll Free: 1-800-843-3131 Direct: 760-328-3834 Ext: 292

Fax: 760-328-5394 [email protected] www.outdoorresortpalmsprings.com

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October 7, 2020 Contracts

A. Roma Coffee Cafe B. Lupe's Salon C. CVWD Property/ Dog Park D. Strategic Plan

Roma Coffee Café

OUTDOOR RESORT - PALM SPRINGS OWNER’S ASSOCIATION BOARD OF DIRECTORS STAFF REPORT

Executive Meeting Date:

October 7, 2020

New

Unfinished

Discussion

Consent Agenda

Executive Session X

Agenda Item:

Roma Coffee Cafe

Description:

Contract Preparation

Submitted By:

Ed Vitrano, General Manager

Date: October 5, 2020

Background: It has been suggested that the contract with Marge’s Espresso Bar be restated in the name of Richard Camacho of TACOOK, Inc., which would simply charge a $50/month rental fee. As an alternative, I would suggest a simple amendment to the current Bella Roma contract, which is attached, naming additional locations for operation but stay with the five categories found on page 2. I have spoken with Richard about a more formal presentation indicating Gross Revenues and he agreed. The contract is due for renewal in October of next year and new considerations can be examined at that time. Discussion ensued with staff and Richard regarding a re-branding of the “espresso bar” and Richard was enthusiastic regarding “Roma Coffee Café” as it ties into “Bella Roma Italian Restaurant”, which he is quite proud of. I didn’t see anything contractual which indicates that ORPS determines the name, although I’d be interested in your opinions . . . I think! For Consideration: Rather than assign an old contract for operation of Roma Coffee Café, to create an addendum, naming new locations of responsibility. Designated Funding: N/A

Board Action:

Lupe’s Salon

OUTDOOR RESORT - PALM SPRINGS OWNER’S ASSOCIATION BOARD OF DIRECTORS STAFF REPORT

Executive Meeting Date:

October 7, 2020

New

Unfinished

Discussion

Consent Agenda

Executive Session X

Agenda Item:

Lupe’s Salon

Description:

Contract Renewal

Submitted By:

Ed Vitrano, General Manager

Date: October 5, 2020

Background: Lupe contacted me about contract renewal and I simply advised her that the contract calls for automatic renewal for another year. Further reading of the contract, which is attached, indicates a 30-day termination notice, with or without cause. In a recent conversation with Lupe, she informed me that her family had put in more than $5,000 of improvements over the last few years and ORPS had contributed a similar amount to modernize the Salon, of which I confirmed with Clint Atherton, past GM. I bring that up since it has been suggested that the Salon become more of a meeting room or gathering place for use by the patrons of the new-style offerings expected from Richard at Roma Coffee Café. President Farmer wanted this to be discussed to see any support for use of the space for anything other than a Salon in the near future. For Consideration: Use of space now occupied by Lupe’s Salon. Designated Funding: N/A

Board Action:

CVWD Property / Dog Park

OUTDOOR RESORT - PALM SPRINGS OWNER’S ASSOCIATION BOARD OF DIRECTORS STAFF REPORT

Executive Meeting Date:

October 7, 2020

New

Unfinished

Discussion

Consent Agenda

Executive Session X

Agenda Item:

CVWD Property/Dog Park

Description:

Review of License Agreement

Submitted By:

Ed Vitrano, General Manager

Date: October 5, 2020

Background: Out of the blue . . . new life. Sunniva is now Prime Asset, the project is now the Ramon Production Campus . . . and the new owner expects an occupancy permit on December 23. I was contacted by the Campus Supervisor and subsequently the project construction manager, who seems to have the most authority, and who Bryon and I met with last Thursday morning and toured the property. Please see, particularly for new Board members, page 8 of the attached Landscape set to get a good idea of what the Dog park will look like . . . not a lot different than past layouts. Prime Asset anticipates that the Dog Park will be completed by March of 2021. The project construction manager agreed that the April 3, 2019 license, which is also attached, needs re-writing or amended and is contacting the corporation for any changes. He suspected none, other than names, will need changing. This also brings into focus the purchase of the CVWD property, which stipulates that a wall will be moved, as found in section 2.1.1 on page 2 of the draft copy of the sales agreement. That is not the intent of OPRS . . . indeed another wall is to be built creating a “corridor” if you will, to the Dog Park. I will depend on Director Leahy to wade in again on any needed changes . . . thanks Charlie! For Consideration: Review of the Dog Park layout, Licensing Agreement, any ORPS Rules & Regulations which are needed, and changes to the Sales Agreement of CVWD property. Designated Funding: N/A

Board Action:

AGREEMENT FOR PURCHASE AND SALE OF REAL ESTATE Portion of APN: 673-020-004

THIS AGREEMENT FOR PURCHASE AND SALE OF REAL ESTATE (this “Agreement”), is entered into as of ___________ __, 2019 (“Effective Date”), by and between COACHELLA VALLEY WATER DISTRICT , a public agency of the State of California (“Seller”) and OUTDOOR RESORTS/PALM SPRINGS OWNERS ASSOCIATION, a California non-profit corporation (“Purchaser”). A. Seller owns that certain land for wellsite purposes (“Property”) commonly known as APN: 673-020-004 more particularly described and depicted on Exhibit “A” attached hereto and made a part hereof. B. The Property is located immediately adjacent to Outdoor Resorts Palm Springs and to Sunniva Production Campus, LLC (“Sunniva”) located in the City of Cathedral City, California that is intended as the future site of Purchaser’s dog park pursuant to License Agreement dated April 3, 2019 between Sunniva and Purchaser. D. Purchaser desires to purchase and Seller desires to sell a portion of the Property as described and depicted on attached Exhibit “B” (the “Surplus Property”) on the terms and conditions contained herein. Seller shall retain an easement for pipelines and access over the entirety of the Surplus Property (“Pipeline and Access Easement”). NOW THEREFORE , in consideration of the mutual covenants hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: ARTICLE 1 AGREEMENT TO PURCHASE AND SELL Purchaser agrees to purchase, and Seller agrees to sell, the Property at the Purchase Price (defined below) and on the terms set forth herein. In furtherance thereof Seller agrees to convey to Purchaser title to the Property together with all existing privileges, rights (including mineral rights to the extent they are transferable by Seller), easements, hereditaments, and appurtenances thereto belonging; and all right, title and interest of Seller in and to the Surplus Property, provided, however, that Seller shall retain all water rights and a Pipeline and Access Easement over the entirety of the Surplus Property for access and connection to the wellsite in the recordable Grant Deed substantially in form and content as set forth in Exhibit “C” attached hereto (“Grant Deed”). ARTICLE 2 PURCHASE TERMS 2.1 Purchase Price . The purchase price (“Purchase Price ” ) to be paid by Purchaser to Seller for the Property shall be Thirty Thousand Dollars ($30,000.00) which shall be paid as follows:

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2.1.1 Relocation of East Wall. The existing block wall along the eastern edge of the Property shall be relocated by Purchaser as shown on Exhibit “D” , attached hereto and incorporated herein by this reference. Purchaser’s contractor shall be responsible for obtaining a construction encroachment permit from Coachella Valley Water District at their sole cost and expense. Purchaser and/or Purchaser’s contractor shall bear all costs of relocating the wall including but not limited to structural engineering, permit fees, inspection fees, material costs and contractor fees and expenses. Purchaser and/or Purchaser’s contractor shall not permit the recordation of any lien or notice on either the Property or the Surplus Property and shall maintain the same in a lien free condition. Purchaser’s contractor shall be currently licensed with the California Contractor’s State License Board and provide evidence of insurance as set forth on Exhibit “F” , attached hereto and incorporated herein by this reference. Purchaser acknowledges and agrees that Southern California Edison (“SCE”) owns an easement within the Surplus Property and that the relocation of the wall shall be subject to the approval of SCE and shall not result in any interruption of service to the wellsite; 2.1.2 Installation of Wrought Iron Gates and Fence. Purchaser shall install wrought iron gates and fence panels as shown on Exhibit “E” attached hereto and incorporated herein by this reference. Purchaser shall bear all costs and expenses of such installation including but not limited to City permits and permanent and construction permits from Coachella Valley Water District, engineering, construction and materials, inspection fees, material costs and contractor fees and expenses. Purchaser and/or Purchaser’s contractor shall not permit the recordation of any lien or notice on either the Property or the Surplus Property and shall maintain the same in a lien free condition. Purchaser’s contractor shall be currently licensed with the California Contractor’s State License Board and provide evidence of insurance as set forth on Exhibit “F” , attached hereto and incorporated herein by this reference. Purchaser shall not permit the recordation of any lien or notice on either the Property or the Surplus Property and shall maintain the same in a lien free condition; 2.1.3 Access Easement Restrictions on Parking. Purchaser acknowledges and agrees that Seller will access to the Property from Sunrise Drive, aka Sunrise Circle, over a portion of the Surplus Property via an access and pipeline easement to be retained by Seller in the Grant Deed attached hereto as Exhibit “C” and depicted in attached Exhibit “B” . Purchaser agrees that Seller’s existing gate may not be blocked at any time and all parking in front of the gate shall be prohibited; 2.1.4 Administrative and Legal Fee. Purchaser has deposited the sum of Fourteen Thousand Dollars ($14,000.00) (the “Deposit”) with Seller to be used toward administrative and legal expenses incurred in preparing this Agreement and consummating the transaction contemplated by this Agreement. Should the actual costs exceed the Deposit, Purchase shall pay any amount in excess of the Deposit upon receipt of an invoice for the same. Should the actual costs be less than the Deposit, the remaining balance of the Deposit shall be refunded to Purchaser; and 2.1.5 Thirty Thousand Dollars ($30,000.00).

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2.2 Escrow and Title Insurance . The parties do not intend to use an escrow for the performance of this Agreement. However, Purchaser may, at Purchaser’s sole cost and expense, obtain a policy of title insurance. 2.3 Closing . The Closing shall occur following verification by Seller of the following: 2.3.1 Completion of relocation of the existing block wall along the eastern edge

of the Property as shown on Exhibit “D” ;

2.3.2 Completion of installation of wrought iron gates and fence panels as shown

on Exhibit “E” ;

2.3.3 Lien waivers and lien releases from all contractors, subcontractors and

materialmen; and

2.3.4 Payment of Thirty Thousand Dollars ($30,000.00).

2.4 Real Property Taxes; Closing Prorations and Adjustments . The parties acknowledge that because of Seller’s status as a public entity, the Property has not been subject to real property taxation during Seller’s period of ownership. Purchaser will become liable for real property taxes and assessments with respect to the Property from and after the Closing, to the extent that such taxes and assessments relate to periods following the Closing. All items of income or expense, if any, shall be prorated according to prevailing local custom in Riverside County, California. All prorations are final. 2.5 Documents To Be Delivered By Seller At Closing . At the Closing, Seller shall deliver or cause to be delivered to Purchaser, the following, each of which shall be in form reasonably satisfactory to Purchaser: 2.5.1 A duly executed and acknowledged Grant Deed to the Property in the form attached hereto as Exhibit “C” ; 2.5.2 All other documents (if any) required to be executed and delivered by Seller; and 2.5.3 Such other instruments and documents as may be reasonably required in order to carry out the purposes of this Agreement. 2.6 Documents To Be Delivered By Purchaser At Closing . At the Closing Purchaser shall deliver to Seller, the following, each of which shall be in form reasonably satisfactory to Seller: 2.6.1 The Purchase Price, plus or minus adjustments, credits and prorations provided for herein; and 2.6.2 A Documentary Transfer Tax Affidavit as required by the Riverside County Assessor-County Clerk-Recorder;

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2.6.3 A Preliminary Change of Ownership Report; and 2.6.4 Such other instruments and documents as may be reasonably required in

order to carry out the purpose of this Agreement. 2.7

Conditions to Seller’s Obligations . The Closing and Seller’s obligations to consummate the transaction contemplated by this Agreement are subject to the satisfaction of the following conditions (or Seller’s waiver thereof) which are for Seller’s sole benefit, on or prior to the dates designated below for the satisfaction of such conditions, or the Closing in absence of a specified date: 2.7.1 Purchaser’s Obligations . As of the Closing, Purchaser shall have timely performed all of the obligations required by the terms of this Agreement to be performed by Purchaser; and 2.7.2 Purchaser’s Representations . As of the Closing, all representations and warranties made by Purchaser to Seller in this Agreement shall be true and correct as of the Closing. 2.8 Conditions to Purchaser’s Obligations . The Closing and Purchaser’s obligations to consummate the transaction contemplated by this Agreement are subject to the satisfaction of the following conditions (or Purchaser’s waiver thereof) which are for Purchaser’s sole benefit, on or prior to the dates designated below for the satisfaction of such conditions, or the Closing in absence of a specified date: 2.8.1 Seller’s Obligations . As of the Closing, Seller shall have timely performed all of the obligations required by the terms of this Agreement to be performed by Seller; and 2.8.2 Seller’s Representations . As of the Closing, all representations and warranties made by Seller to Purchaser in this Agreement shall be true and correct as of the Closing. If and to the extent that any condition to Purchaser’s obligation to consummate the purchase of the Property fails to be satisfied, then Buyer may either (a) waive such condition and proceed with the Closing, or (b) terminate the Agreement in which event neither party shall have any further obligation to the other party. 2.9 Covenants . Prior to the Closing or termination of this Agreement, 2.9.1 Seller agrees: (a) Seller will not enter into any new lease agreements, license agreements or similar agreements with respect to the Surplus Property, (b) Seller will not encumber the Surplus Property, (c) enter into any maintenance or service agreement that will survive the Closing and (d) construct any new improvements on the Surplus Property; and 2.9.2 Purchaser covenants to prosecute the relocation of the existing block wall and installation of wrought iron gates and fence panels diligently and to complete all such work in a workmanlike manner, maintaining the Property and the Surplus Property in a clean, neat and lien free condition.

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ARTICLE 3 REVIEW PERIOD

3.1 Purchaser’s Review Period . Purchaser’s Review Period (“Review Period”) shall expire twenty-five (25) days after the execution of this Agreement, unless terminated earlier by Purchaser. If Purchaser has not approved, disapproved or waived all contingencies by written notice to Seller prior to the expiration of Purchaser’s Review Period (which approval, disapproval or waiver shall be at the sole and absolute discretion of Purchaser) then all feasibility contingencies of Purchaser shall be deemed disapproved and this Agreement shall be terminated. Any written approval by Purchaser pursuant to this Section shall be without conditions or qualifications and any written notice from Purchaser pursuant to this Section 3.1 containing conditions or qualifications will be deemed disapproval. 3.1.1 Prior to the expiration of the Review Period, Purchaser shall have the right, at Purchaser’s sole cost and expense, to obtain and review a preliminary title report (“Title Report”) for the Property. Prior to the expiration of the Review Period, Purchaser shall provide written notice to Seller or any objections to the Title Report. Seller shall have five (5) business days after the receipt of an objection notice from Purchaser to elect to cure any objection to the Title Report raised by Purchaser. If Seller agrees to cure an objection to the Title Report, such cure shall be a condition to the obligation of Purchaser to proceed with the Closing. If Seller fails to provide a response to Purchaser’s objection to the Title Report, Seller shall be deemed to have elected to refuse to cure such title objection in which event Purchaser shall have two (2) business days after the expiration of Seller’s five-business day review period to elect to either (i) waive Purchaser’s objections and proceed with the Closing or (ii) terminate this Agreement. 3.1.2 Purchaser shall have the right, and Seller shall reasonably cooperate with Purchaser as necessary and at no cost to Seller, to obtain such zoning, variances, permits, approvals and other entitlements (“Entitlements”) as may be necessary or desirable to Purchaser to obtain for Purchaser’s intended development or use of the Property; provided, however, that in no event shall any Entitlements be binding upon Seller or the Property, nor shall such Entitlements be binding upon the Surplus Property prior to the Closing or upon termination of this Agreement and provided further that the receipt of such Entitlements shall not be a condition to Closing. 3.2 Purchaser’s Investigations of the Property . During the Review Period, Purchaser and its agents and contractors shall have the right to conduct such investigations and enter upon the Property to conduct, at Purchaser’s expense, such tests and investigations as may be necessary for Purchaser to determine whether any matter would materially hinder or make economically unfeasible Purchaser’s intended use of the Surplus Property. Prior to Purchaser or its agents or contractors entering upon the Surplus Property pursuant to this Article 3, Purchaser shall (a) give Seller twenty-four (24) hours prior notice of such entry, and (b) provide satisfactory evidence to Seller that Purchaser, or its agents or contractors, have obtained commercial general liability insurance, with limits of not less than $2,000,000.00 per occurrence and $4,000,000.00 in aggregate; workers compensation insurance in statutory limits and employers liability insurance with limits not less than $1,000,000.00 each incident; and umbrella excess liability insurance excess of the underlying commercial general liability and employers liability insurance with limits not less than $1,000,000.00 per occurrence and 2,000,000.00 aggregate.

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3.3 Indemnification . Purchaser will defend, indemnify and hold Seller free and harmless from and against any and all claims, damages and liabilities relating to or arising out of Purchaser’s exercise of its rights under Section 3.2 above provided that Purchaser shall not responsible for any latent defects that are merely discovered by Purchaser and not intentionally exacerbated by Purchaser. Purchaser will assure that all costs associated with its conduct of the investigations are fully satisfied and that the Property is not subjected to any liens with respect thereto. 3.4 Copies of Reports . In the event of a material default by Purchaser, Purchaser shall provide to Seller copies of all reports resulting from Purchaser’s exercise of its rights under this Article 3. Such reports will be provided without cost to Seller and without warranty or representation from Purchaser with respect to the information contained therein. ARTICLE 4 REPRESENTATIONS AND WARRANTIES 4.1 Seller’s Representations and Warranties . Seller is selling the Surplus Property AS-IS with all faults, but represents and warrants to Purchaser as follows: 4.1.1 Authority . Seller has full power and authority to sell, convey and transfer the Surplus Property as provided for in this Agreement and this Agreement is binding and enforceable against Seller. 4.1.2 Hazardous Materials . To Seller’s actual knowledge, Seller has not caused any Hazardous Materials to be placed or disposed of on or at the Surplus Property or any part thereof in any manner or quantity which would constitute a violation of any Environmental Law, nor has Seller received any written notices that the Surplus Property is in violation of any Environmental Law. As used herein, (a) the term “Hazardous Materials” shall mean any hazardous, toxic or dangerous substance, material, waste, gas or particulate matter which is defined as such for purposes of regulation by any local government authority, the State of California, or the United States Government, including, but not limited to, any material or substance which is (i) defined as a hazardous waste, hazardous material, hazardous substance, extremely hazardous waste, or restricted hazardous waste under any provision of California law, (ii) petroleum, (iii) asbestos, (iv) polychlorinated biphenyl, (v) radioactive material, (vi) designated as a hazardous substance pursuant to Section 311 of the Clean Water Act, 33 U.S.C. Sec. 1251 et seq. (33 U.S.C. Sec. 1317), (vii) defined as a hazardous waste pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Sec. 6901 et seq. (42 U.S.C. Sec. 6903), or (viii) defined as a hazardous substance pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Sec. 9601 et seq. (42 U.S.C. Sec. 9601); and (b) the term “Environmental Laws” shall mean all statutes specifically described in the definition of Hazardous Materials and all other federal, state or local laws, regulations or orders relating to or imposing liability or standards of conduct concerning any Hazardous Material. 4.1.3 With respect to the Surplus Property, there are no existing or pending contracts of sale, options to purchase, rights of first refusal (or the like) or other unrecorded agreements or understandings with third parties regarding the ownership or use of the Property.

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4.1.4 There are no pending or, to the best of Seller’s knowledge, contemplated eminent domain or condemnation proceedings affecting or which may affect any portion of the Surplus Property. 4.2 Purchaser’s Representations and Warranties . Except as expressly set forth in this Agreement, Purchaser is relying upon no warranties, express or implied, oral or written, from Seller regarding the Surplus Property and, upon Closing, Purchaser will have accepted the Surplus Property as-is, with all faults. Purchaser represents and warrants to Seller as follows: 4.2.1 Agreements . Neither the execution and delivery of this Agreement by Purchaser nor the consummation of the transactions contemplated hereby will result in any breach or violation of or default under any judgment, decree, order, mortgage, lease, agreement, indenture or other instrument to which Purchaser is a party. 4.2.2 Authority . Purchaser is a duly organized corporation in good standing with the California Secretary of State and Purchaser has full power and authority to execute this Agreement and purchase the Property as provided for in this Agreement and this Agreement is binding and enforceable against Purchaser. 4.2.3 As-Is Acquisition . PURCHASER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN, SELLER HAS NOT MADE, DOES NOT MAKE AND SPECIFICALLY NEGATES AND DISCLAIMS ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST, PRESENT OR FUTURE, OF, AS TO, CONCERNING OR WITH RESPECT TO (A) VALUE; (B) THE INCOME TO BE DERIVED FROM THE SURPLUS PROPERTY; (C) THE NATURE, QUALITY OR CONDITION OF THE SURPLUS PROPERTY, INCLUDING, WITHOUT LIMITATION, THE WATER, SOIL AND GEOLOGY; (D) THE COMPLIANCE OF OR BY THE SURPLUS PROPERTY OR ITS OPERATION WITH ANY LAWS, RULES, ORDINANCES OR REGULATIONS OF ANY APPLICABLE GOVERNMENTAL AUTHORITY OR BODY; (E) COMPLIANCE WITH ANY ENVIRONMENTAL PROTECTION, POLLUTION OR LAND USE LAWS, RULES, REGULATION, ORDERS OR REQUIREMENTS, INCLUDING BUT NOT LIMITED TO, TITLE III OF THE AMERICANS WITH DISABILITIES ACT OF 1990, CALIFORNIA HEALTH & SAFETY CODE, THE FEDERAL WATER POLLUTION CONTROL ACT, THE FEDERAL RESOURCE CONSERVATION AND RECOVERY ACT, THE U.S. ENVIRONMENTAL PROTECTION AGENCY REGULATIONS AT 40 C.F.R., PART 261, THE COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY ACT OF 1980, AS AMENDED, THE RESOURCE CONSERVATION AND RECOVERY ACT OF 1976, THE CLEAN WATER ACT, THE SAFE DRINKING WATER ACT, THE HAZARDOUS MATERIALS TRANSPORTATION ACT, THE TOXIC SUBSTANCE CONTROL ACT, AND REGULATIONS PROMULGATED UNDER ANY OF THE FOREGOING; (F) THE PRESENCE OR ABSENCE OF HAZARDOUS MATERIALS AT, ON, UNDER, OR ADJACENT TO THE SURPLUS PROPERTY; (G) THE CONTENT, COMPLETENESS OR ACCURACY OF ANY DUE DILIGENCE MATERIALS DELIVERED BY SELLER TO PURCHASER OR PRELIMINARY REPORT REGARDING TITLE; (H) DEFICIENCY OF ANY UNDERSHORING; (I) DEFICIENCY OF ANY DRAINAGE; (J) THE

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FACT THAT ALL OR A PORTION OF THE SURPLUS PROPERTY MAY BE LOCATED ON OR NEAR AN EARTHQUAKE FAULT LINE OR A FLOOD ZONE; OR (K) WITH RESPECT TO ANY OTHER MATTER. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT IT HAS OR WILL HAVE BEEN GIVEN THE OPPORTUNITY TO INSPECT THE SURPLUS PROPERTY AND REVIEW INFORMATION AND DOCUMENTATION AFFECTING THE SURPLUS PROPERTY, AND THAT, EXCEPT FOR SELLER’S EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED HEREIN, PURCHASER IS RELYING SOLELY ON ITS OWN INVESTIGATION OF THE SURPLUS PROPERTY AND REVIEW OF SUCH INFORMATION AND DOCUMENTATION, AND NOT ON ANY INFORMATION PROVIDED OR TO BE PROVIDED BY SELLER. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT ANY INFORMATION MADE AVAILABLE TO PURCHASER OR PROVIDED OR TO BE PROVIDED BY OR ON BEHALF OF SELLER WITH RESPECT TO THE SURPLUS PROPERTY WAS OBTAINED FROM A VARIETY OF SOURCES AND THAT SELLER HAS NOT MADE ANY INDEPENDENT INVESTIGATION OR VERIFICATION OF SUCH INFORMATION AND MAKES NO REPRESENTATIONS AS TO THE ACCURACY OR COMPLETENESS OF SUCH INFORMATION. PURCHASER AGREES TO FULLY AND IRREVOCABLY RELEASE ALL SUCH SOURCES OF INFORMATION AND PREPARERS OF INFORMATION AND DOCUMENTATION AFFECTING THE SURPLUS PROPERTY WHICH WERE RETAINED BY SELLER FROM ANY AND ALL CLAIMS THAT THEY MAY NOW HAVE OR HEREAFTER ACQUIRE AGAINST SUCH SOURCES AND PREPARERS OF INFORMATION FOR ANY COSTS, LOSS, LIABILITY, DAMAGE, EXPENSE, DEMAND, ACTION OR CAUSE OF ACTION ARISING FROM SUCH INFORMATION OR DOCUMENTATION. EXCEPT FOR SELLER’S EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED IN SECTION 4.1 ABOVE, SELLER IS NOT LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR WRITTEN STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE SURPLUS PROPERTY, OR THE OPERATION THEREOF, FURNISHED BY ANY REAL ESTATE BROKER, AGENT, EMPLOYEE, SERVANT OR OTHER PERSON. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT TO THE MAXIMUM EXTENT PERMITTED BY LAW, EXCEPT FOR SELLER’S EXPRESS REPRESENTATIONS ANDWARRANTIES CONTAINED IN SECTION 4.1 ABOVE, THE SALE OF THE SURPLUS PROPERTY AS PROVIDED FOR HEREIN IS MADE ON AN AS IS CONDITION AND BASIS WITH ALL FAULTS, AND THAT SELLER HAS NO OBLIGATIONS TO MAKE REPAIRS, REPLACEMENTS OR IMPROVEMENTS EXCEPT AS MAY OTHERWISE BE EXPRESSLY STATED HEREIN. PURCHASER REPRESENTS, WARRANTS AND COVENANTS TO SELLER THAT, EXCEPT FOR SELLER’S EXPRESS REPRESENTATIONS AND WARRANTIES SPECIFIED IN THIS AGREEMENT, PURCHASER IS RELYING SOLELY UPON PURCHASER’S OWN INVESTIGATION OF THE SURPLUS PROPERTY.

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4.2.4 General Waiver . With respect to the waivers and releases set forth in Section 4.2.3, above, Purchaser expressly waives any of its rights granted under California Civil Code Section 1542, which provides as follows: A general release does not extend to claims which the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release, and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party. ___________________ Purchaser’s Initials

ARTICLE 5 DEFAULTS; REMEDIES

5.1 PURCHASER’S DEFAULT AND LIQUIDATED DAMAGES . PURCHASER AND SELLER AGREE THAT SHOULD PURCHASER DEFAULT IN PURCHASER’S OBLIGATION TO PURCHASE THE PROPERTY WITHIN THE TIME AND IN THE MANNER SPECIFIED IN THIS AGREEMENT, SELLER SHALL BE RELEASED FROMALL OBLIGATIONS AT LAW OR IN EQUITY TO CONVEY THE SURPLUS PROPERTY TO PURCHASER. Seller’s Initials: _________ Purchaser’s Initials: _________ ________ In addition, Seller may pursue against Purchaser any and all other rights and remedies available at law or in equity, to obtain from Purchaser (on an AS IS basis and subject to the rights of third parties): (a) copies of all soil tests, environmental studies, and other tests and studies pertaining to the Surplus Property obtained by Purchaser, and (b) reimbursement for the payment of any costs and expenses incurred by Seller and properly allocable to Purchaser under Article 3 or Section 6.15. 5.2 Seller’s Default . If the transaction contemplated hereby does not close by reason of a material, uncured default by Seller in any of the terms hereof, then Purchaser may terminate this Agreement and pursue against Seller as Purchaser’s sole and exclusive remedy, an action to compel Seller’s specific performance of this Agreement. In no event shall Seller be liable to Purchaser for indirect or consequential damages, including, without limitation, any loss or damage suffered by Purchaser in connection with any lost profit or other agreement or understanding with any third party for the use, lease or purchase of the Surplus Property.

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ARTICLE 6 MISCELLANEOUS

6.1 Payment of Real Estate Brokers and Consultants . Each party represents to the other that no real estate broker has been used in connection with this transaction unless pursuant to a separate agreement. Purchaser agrees to indemnify, defend and hold Seller harmless from and against any claim for a real estate broker’s commission or fee by any party claiming to have represented Purchaser in connection with this transaction. Seller agrees to indemnify, defend and hold Purchaser harmless from and against any claim for a real estate broker’s commission or fee by any party claiming to have represented Seller in connection with this transaction. The indemnification obligations under this Section 6.1 shall survive the Closing or any termination of this Agreement for any reason whatsoever. 6.2 Notices . All notices and other communications which are required to be, or which may be given under this Agreement shall be in writing, and shall be delivered at the addresses set out hereinbelow. Notice may be given by personal delivery, recognized overnight courier, by United States mail or by facsimile transmission in the manner set forth below. Notice shall be deemed to have been duly given (a) if by personal delivery, on the first to occur of the date of actual receipt or refusal of delivery by any person at the intended address, (b) if by overnight courier, on the first (1st) Business Day after being delivered to a recognized overnight courier, (c) if by mail, on the third (3rd) Business Day after being deposited in the United States mail, certified or registered mail, return receipt requested, postage prepaid, or (d) by facsimile transmission shall be deemed to have been given on the next business day after being transmitted, as evidenced by the confirmation slip generated by the sender’s facsimile machine addressed as follows: If to Seller: Coachella Valley Water District

75515 Hovley Lane East Palm Desert, CA 92211 Attn: General Manager Telephone: (760) 398-2651

With a copy to:

Best Best & Krieger LLP 3390 University Avenue, 5 th Floor Riverside, CA 92501 Attn: Jeff Ferre Telephone: (951) 686-1450

If to Purchaser:

Outdoor Resorts/ Palm Springs Owners Association 69411 Ramon Road Cathedral City, CA 92234 Attn: Clint Atherton, General Manager Telephone: (760) 328-3834

or to such other address as either party may from time to time specify as its address for the receipt of notices hereunder, in a notice to the other party. Notices given by an attorney shall be deemed to constitute notice from that party.

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6.3 Possession . Possession of the Surplus Property shall be delivered to Purchaser at the Closing. 6.4 Assignment . Purchaser may not assign or pledge any of its rights hereunder without the prior written consent of Seller. Subject to the foregoing, this Agreement shall be binding upon the parties hereto and each of their successors and assigns. 6.5 Entire Agreement . This Agreement embodies the entire understanding of the parties and there are no further or other agreements or understandings, written or oral, in effect between the parties relating to the subject matter hereof except as may be set forth in writing executed by both parties contemporaneously with or subsequent to this Agreement. 6.6 Severability . If any term or provision of this Agreement or any application thereof shall be invalid or unenforceable, the remainder of this Agreement and other applications thereof shall not be affected thereby. 6.7 Captions; Number . The captions contained in this Agreement are for the convenience of reference only, and shall not affect the meaning, interpretation or construction of this Agreement. As used in this Agreement, the singular form shall include the plural and the plural shall include the singular, to the extent that the context renders it appropriate. 6.8 Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument. 6.9 Governing Law . This Agreement has been executed and delivered, and is to be performed, in the State of California, and this Agreement and all rights, obligations and liabilities hereunder shall be governed by, and construed in accordance with, the internal laws of the State of California. Purchaser hereby irrevocably waives any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement brought in any federal or state court sitting in Riverside County, California. 6.10 Time of the Essence . Time is of the essence of this Agreement. 6.11 Modification . The provisions of this Agreement may not be amended, changed or modified orally, but only by an agreement in writing signed by the party against whom any amendment, change or modification is sought. 6.12 Waiver . Except as otherwise expressly provided in this Agreement, no waiver by a party of any breach of this Agreement or of any warranty or representation hereunder by the other party shall be deemed to be a waiver of any other breach by such other party (whether preceding or succeeding and whether or not of the same or similar nature) and no acceptance of payment or performance by a party after any breach by the other party shall be deemed to be a waiver of any breach of this Agreement or of any representation or warranty hereunder by such other party whether or not the first party knows such breach at the time it accepts such payment or performance. Except as otherwise expressly provided in this Agreement, no failure or delay by a party to exercise any right it may have by reason of the default of the other party shall operate as

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a waiver of default or modification of this Agreement or shall prevent the exercise of any right by the first party while the other party continues to be so in default. 6.13 Business Days . Except as otherwise provided in this Agreement, if any date specified in this Agreement for the Closing Date or for commencement or expiration of time periods for termination or approvals or for notice occurs on a day other than a Business Day, then any such date shall be postponed to the following Business Day. As used herein, “Business Day” shall mean any day other than a Saturday, Sunday, a holiday observed by national banks or a day that is a non-working day for Seller. 6.14 Attorney Fees . In the event of any dispute arising out of the enforcement or interpretation of this Agreement, the prevailing party shall be entitled to reasonable attorney fees and costs, to include any attorney fees or costs on appeal. 6.15 Termination Due to Lack of Execution . If Purchaser has not provided a signed copy of this Agreement to Seller within thirty (30) days following Seller’s delivery of this Agreement to Purchaser, Seller may elect to terminate this Agreement and the transaction described herein by written notice to Purchaser.

REMAINDER OF PAGE INTENTIONALLY LEFT BLANK SIGNATURE PAGE FOLLOWS

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IN WITNESS WHEREOF , the parties have executed this Agreement as of the date first written above. SELLER: COACHELLA VALLEY WATER DISTRICT, a public agency of the State of California

By: Name: J. M. Barrett Its:

General Manager

PURCHASER: OUTDOOR RESORTS / PALM SPRINGS OWNERS ASSOCIATION, a California non-profit corporation

By: Name: Title: President

By: Name: Title: Secretary

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EXHIBIT “A” Legal Description and Depiction of the Property

[ATTACHED]

Exhibit “A”

19782.00019\32344835.3

EXHIBIT “B” Legal Description and Depiction of the Surplus Property

[ATTACHED]

EXHIBIT “B”

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EXHIBIT “C” Grant Deed

RECORDING REQUESTED BY: Coachella Valley Water District

75515 Hovley Lane East Palm Desert, CA 92211 WHEN RECORDED MAIL TO: Outdoor Resorts/ Palm Springs Owners Association 69411 Ramon Road Cathedral City, CA 92234 Attn: Clint Atherton ______________________________________________________________________________ Portion of APN: 673-020-004 Exempt from Recording Fees per Govt. Code §27383 THE UNDERSIGNED GRANTOR DECLARES: Documentary Transfer Tax is: $_____________ Assessor’s Parcel No. 673-020-004 □ computed on full value of interest or property conveyed, or □ computed on full value of liens or encumbrances remaining at time of sale; GRANT DEED FOR VALUE RECEIVED, receipt of which is hereby acknowledged, COACHELLA VALLEYWATER DISTRICT, a public agency of the State of California (“Grantor”) hereby grants to OUTDOOR RESORTS / PALM SPRINGS OWNERS ASSOCIATION, a California non-profit corporation (“Grantee”) all that certain real property situated in the City of Cathedral City, County of Riverside, State of California, more fully described in Exhibit “1” and depicted on Exhibit “2” , each attached hereto and incorporated herein by this reference (“Surplus Property”). Grantor hereby retains an easement for pedestrian and vehicular access and for the installation, use and maintenance of water and sewer pipelines (“Pipeline and Access Easement”) over the entirety of the Surplus Property (“Easement Area”). Grantee accepts the Surplus Property subject to the rights of access and use by Grantor. Grantee shall not block, obscure or otherwise cause or permit anything to be placed on the Property that will interfere with Grantor’s pipelines or access. No parking shall be permitted in front of Grantor’s access gate shown on Exhibit “2” . Grantee, and their successors and assigns, shall not increase or decrease, or permit to be increased or decreased, the now existing ground elevations of the Easement Area or change, alter, modify or change the location or alignment of any driveways or driving areas, the alignment or the grading of the Easement Area without the prior written consent of Grantor. Grantee shall not change, alter or modify the flow of water or storm water within the Easement Area, cause any erosion, allow any water run-off from irrigation, construct, install or erect any permanent or temporary structures such as buildings, sheds, barns, garages or walls, and no trees, shrubs or plants, shall be placed, planted or maintained in any portion of the Easement Area without the prior written consent of Grantor, which may be withheld in the sole and absolute discretion of Grantor. No vehicular traffic exceeding twenty (20) tons will be permitted in the Easement Area. Grantor shall not unreasonably withhold or delay approval of matters to which its consent is required if those

EXHIBIT “C”

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