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Home My WebLink AboutBEACON BAY LEASE LOT 62_05_FINANCE_DOCUMENTS11111111 lill 111111111111111111111111111111111 *NEW FILE* Beacon Bay Lease Lot 62 05_FINANCE_DOCUMENTS 11 0 t e I City Manager's Office (949)644-3002 May 9, 2007 Chad and Christina Steelberg P.O. Box 8129 Newport Beach, CA 92660 CITY OF NEWPORT BEACH RE: Notice of Rent Adjustment for 62 Beacon Bay Dear Mr. and Mrs. Steelberg: As per section 3.6.(4)(a) of your land lease agreement, effective June 22, 2007, your land tease payment per month will increase by $833.75. Your new monthly rent for this property will be $3,958.75. We will prorate the month of June 2007 as follows: • June 1 - 21, 2007 = $27187.50 (old rate) • June 22 - 30, 2007 = 1,187.63 (new rate) Total $3,375.13 Beginning July 2007 you will be billed at the new rate of $3,958.75 per month. If you have any questions, please contact Shirley Oborny at 949- 644-3002. Sincerely, Dave Kiff Assistant City Manager cc: Seanne Carney, Fiscal Specialist City Hall • 3300 Newport Boulevard • Post Office Box 1768 Newport Beach California 92658-8915 • www.city.newport-beach.ca.us i Rent Increase Calculations for Lot 62 Beacon Bay Calculations are based on section 3.13.(4)(a) of 7/1/94lease. Lease Execution Date: Date of Rental Adjustment: Date 90 days prior to Rental Adjustment: CPI at time of Execution Date: CPI avail. 90 days prior to Rental Adjustment: IncreaselDecrease in CPI: % of Increase/Decrease: 6/2212007 3/24/2007 170.9 (6122/00 - attached) 216.5 45.6 26.68% increase (45.6 divided by 170.9) (3/24107 - attached) Multiply current rent by % of Increase/Decrease: $3,125 X 26.68% _ $833.75 Add or Decrease above total to determine new rent: $3,125.00 + $833.75 = $3958.75 (per lease, can never be increased/decreased by greater than 40%) Prorated rent for June 2007 Old rent $ = 3,125.06 June 1 - June 21 Increased rent = $3958.75 June 22 - June 30 $104.17 per day $2,187.50 $131.96 per day $1,187.63 Total: $3,376.13 5/9/2007 recard is available on the Internet on the day of publication at http://www.bis.gov/ro9lpachist.htm. Twenty year historical files for any of indexes listed below are also available on the WEB by going to http://www.bls.gov/ro9imostrequ.htm. CONSUMER PRICE INDEXES PACIFIC CITIES AND U. S. CITY AVERAGE MARCH 2O07 ALL ITEMS INDEXES (1982-84=100 unless otherwise noted) All Urban Consumers (CPI-U) Urban Wage Earners and Clerical Workers (CPI-W) Percent Char a Percent Change MONTHLY DATA Indexes Indexes Year 1 Month Year 1 Month endin ending ending ending Mar. Feb. Mar. Feb. Mar. Mar. Mar. Feb. Mar. Feb. Mar. Mar. 2006 2007 2007 2007 2007 2007 2006 2007 2007 2007 2007 2007 199.8 203.499 205.352 2.4 2.8 0.9 195.3 198.544 200.612 2.2 2.7 1.0 U. S. City Average ................................ (1967=100)..................................... Los Angeles -Riverside -Orange Co...... 598.6 208.5 609.594 214.760 615.145 216.500 - 3.5 - 3.8 - 0.8 581.8 200.8 591A03 206.632 597.561 208.929 - 3.4 - 4.0 - 1.1 (1967=100)..................................... West ..................................................... 616.0 203.8 634.496 208.995 639.638 210.778 - 3.1 - 3.4 - 0.9 593.4 198.3 610.660 203.036 617.449 205.173 - 3.0 - 3.5 - 1.1 (Dec319.1 West-A.f1977 = 100) ......::::::::.:::::::: 206.8 212.549 214.393 3.3 3.7 0.9 199.7 326.6741 204.885 330.111, 207.180 - 3.2 - 3.7 - 1.1 (Dec. 1977 = 100) .......................... West-B/C•'(Dec.1996=100).............. 337.2 124.2 346.590 126.805 349.596 127.848 - 2.5 - 2.9 - 0.8 323.3 123.6 331.670 126.161 335.384 127.333 - 2.5 - 3.0 - 0.9 All Urban Consumers (CPI-U) Urban Wage Earners and Clerical Workers (CPI.W) Percent Change Percent Chan e BI-MONTHLY DATA Indexes Year 2 Months Indexes Year 2 Months ending ending endin ending Feb. Dec. Feb. Dec. Feb. Feb. Feb. Dec. Feb. Dec. Feb. Feb. 2006 2006 2007 2006 2007 2007 2006 2006 2007 2006 2007 2007 San Francisco -Oakland -San Jose........ 207.1 210.4 213.688 3.4 3.2 1.6 202.5 205.6 208.803 3.2 3.1 1.6 (1967=100)..................................... Seattle -Tacoma -Bremerton .................. 636.6 203.6 646.7 209.3 656.937 211.704 - 4.2 - 4.0 - 1.1 616.6 198.0 626.1 204.3 635.823 205.746 - 4.2 - 3.9 - 0.7 (1967=100)..................................... 620.7 638.1 645.356 587.3 606.0 610.243 - • A= 1,500,000 population and over -- BIC = less than 1,500,000 population Dash (-) = Not Available. Release date April 17, 2007. The next monthly and bi-monthly releases are scheduled to be issued on May 15,2007. The next semi-annual releases are scheduled to be issued on August 15, 2007. Anchorage (907) 271-2770 Los Angeles (310) 235-6884 Portland (503) 326-5818 San Francisco (415) 625-2270 Honolulu (808) 541-2808 Phoenix (480) 503-9075 San Diego (619) 557-6538 Seattle (206) 553-0645 k • • t Tilts card is avr 9n th net or 'ay of publication • ^. httn://1 aclick-Pacific CIL ad U.S. CityA. This card is also available on our FAX -ON -DEMAND service. To obtain a copy, c also on file FAX -ON -DEMAND system, to receive a copy of May 2000, enter 9105 www. 61s. 9oV'ro9rwr w s, I ih-, S MONTHLY DATA JUNE 1999 U. S. City Average ............... 166.2 (1967.100).................. 497.9 Loa Aegelas-Riveraide-Orange Co.. 165.4 (1967.100).................. 488.7 Went ..... .... .... ......... 168.3 (Dec. 1... - 3... .......... 169.3 Went - A.. 1977 ................ 276.1 (Dec. 1977 . 100) 100 ...... 276.1 Went - 8/C. (Dam. 1996.100)...... 109.5 1999 San Pranciaeo-Oakland-son JOB. 1/.... 171.8 (1967-100)..................... 528.3 Seattle -Tacoma -Bremerton y/.......... 172.7 Ty", 1 -f) 9r (PDF) version. i67. When asked for a document number, enter 9106. Prior month: enter 9104, March 2000, enter 9103, February 2000, enter 9102, Jan n.n ce....,.h.r1999.-nmr 909. Aunust 1999. enter 9108. etc. I IFIC CITIES AND U. S. CITY AVER ALL ITEMS INDEXES (1982-84.100 =1000 otherwise noted) DONE 2000 ALL URBAN CONSUMERS PERCENT CHANGE Year 1 Mouth l MDEXES ending ending MAY DONE NAY JUNE JDn3 2000 2000 2000 2000 2101 171.3 172.3 3.1 3.7 0.6 l 1 513.3 516.1 - 4' 171.3. 170.9 2.� 3.3 < -0.1 1. SU5.4 504.9 - - I 4 173.9 174.3 3.1 3.6 0.2 l 1 281.2 201.7 - - - I 2 175.4 175.7 3.3 3.8 0.2 i 1 286.1 286.5 - - . 1 2 107.3 107.6 2.4 3.0 0.3 i 1 Year 2 Mmnthel Imms coding andingl APR. JDNS APR. JOKE Om1E I 2000 2000 2000 2000 2000 178.6 179.0 3.7 4.2 0.2 l 1 549.2 550.4 - - - 1 5 177.7 179.1 3.2 3.7 0.8 1 1 541 6 546 0 - - - 1 4 URRAtt WAGE EARMERS AND CLERICAL WORKERS PERCENT CLLANGE Year 1 Month INDEXES ending ending MITE MAY JUNE HAY JUNE JUNE .999 2000 2000 2000 2000 2000 t2.8 3.68.1 169.1 3.3 3.9 0.6 15.0 500.7 503.8 - - - {8.9 164.4 164.2 2.9 3.3 -0.1 i9.7 485.7 485.3 - - - A.2 169.6 169.9 3.0 3.5 0.2 i4.2 272.9 273.3 - - - 53.5 169.3 169.6 3.2 3.7 0.2 i4.7 274.1 274.5 - - - )4.3 107.1 107.4 2.3 3.0 0.3 Year 2 Months INDEXES ending ending LURE APR. JUNE APR. JUNE JUNE L999 2000 2000 2000 2000 2000 58.3 174.8 175.2 3.6 4.1 0.2 L2.5 523.4 533.5 - - - 60.0 173.2 174.4 3.2 3.0 0.7 1. n cn] L 9171 (1967-100)..................... 526.5 1/ no am Pcmelaco-Oakland-Ben J-se and aeactle.Tacoma.Bremerton urban area. are published bi.monthly 0. eve- --the only (Feb, APril, June, nor, and Dec). The mart CPI All Items index-- for the aen Francisco and 8eattl. ereea rill be for August 2000 end rol-aaed on September 15, 2000 .01xa cl...... A . 1,500,000 populsting. end ovar,..R/c . lose then 1,500,000 population. Dash (-). Not Available Ralease dote July 10, 2000. Next reload- ditto Auauet 16, 2000. For or. 1-L-resting mall (415) 975-4350. Anchorage (907) 271-2770 Lou Ange108 (310) 235-6884 Son Diego (619) 557-038 Seattle (206) 553-064 Honolulu (808) 541-2808 Portland (503) 326-2081 San Prancieco (415) 975-4356 URRAtt WAGE EARMERS AND CLERICAL WORKERS PERCENT CLLANGE Year 1 Month INDEXES ending ending MITE MAY JUNE HAY JUNE JUNE .999 2000 2000 2000 2000 2000 t2.8 3.68.1 169.1 3.3 3.9 0.6 15.0 500.7 503.8 - - - {8.9 164.4 164.2 2.9 3.3 -0.1 i9.7 485.7 485.3 - - - A.2 169.6 169.9 3.0 3.5 0.2 i4.2 272.9 273.3 - - - 53.5 169.3 169.6 3.2 3.7 0.2 i4.7 274.1 274.5 - - - )4.3 107.1 107.4 2.3 3.0 0.3 Year 2 Months INDEXES ending ending LURE APR. JUNE APR. JUNE JUNE L999 2000 2000 2000 2000 2000 58.3 174.8 175.2 3.6 4.1 0.2 L2.5 523.4 533.5 - - - 60.0 173.2 174.4 3.2 3.0 0.7 1. n cn] L 9171 (1967-100)..................... 526.5 1/ no am Pcmelaco-Oakland-Ben J-se and aeactle.Tacoma.Bremerton urban area. are published bi.monthly 0. eve- --the only (Feb, APril, June, nor, and Dec). The mart CPI All Items index-- for the aen Francisco and 8eattl. ereea rill be for August 2000 end rol-aaed on September 15, 2000 .01xa cl...... A . 1,500,000 populsting. end ovar,..R/c . lose then 1,500,000 population. Dash (-). Not Available Ralease dote July 10, 2000. Next reload- ditto Auauet 16, 2000. For or. 1-L-resting mall (415) 975-4350. Anchorage (907) 271-2770 Lou Ange108 (310) 235-6884 Son Diego (619) 557-038 Seattle (206) 553-064 Honolulu (808) 541-2808 Portland (503) 326-2081 San Prancieco (415) 975-4356 CITY OF NEWPORT BEACH OFFICE OF THE CITY MANAGER July 24, 2000 TO: REVENUE DEPARTMENT FROM: MARION BROCKMAN SUBJECT: CHANGE IN OWNERSHIP FOR 62 BEACON BAY A new lease was signed for subject property (62 Beacon Bay) on June 22, 2000. The new monthly rental is $3,125.00. Please bill this amount to new owner, Chad and Cristina Seelberg, at 62 Beacon Bay. Thanks, Marion Brockman I E S C R O W Telephone (949) 644-3939.2 Civic Plaza • Suite 200 • Newport Beach, CA 92660 • FAX (949) 644-3938 www.freedomescrow.com June 29, 2000 City of Newport Beach City Hall 3300 Newport Blvd. Newport Beach, CA 92663-3884 Attn: Marion Brockman RE: Escrow No. 34498-YR 62 Beacon Bay Dear Marion, Enclosed please find the following: Executed Lease (2) Memorandum of Lease Termination of Leasehold when the above items are ready so that I can arrange for a messenger to pick up (we are closing on July 7, 2000). yours, 'G°ail Ferre' Escrow Officer i a CITY OF NEWPORT BEACH �< o Office of City Manager (949)644-3002 June 15, 2000 Kathy Rodriguez Escrow Officer Freedom Escrow 2 Civic Plaza, Suite 200 Newport Beach, CA 92660 Subject: 62 Beacon Bay Escrow No.: 34498-KR Enclosed please find two original leases, a Termination of Lease, and a Memorandum of Lease. Please have all documents signed and the Memorandum and Termination of Lease notarized, and return to the City for signatures. The current lease amount is $1,810.94 per month and the payments are current. Sincerely, Marion Brockman Administrative Assistant mb Enclosures City Hall • 3300 Newport Boulevard 9 Newport Beach, California 92663-3884 :'EREE S C R O W Telephone (949) 644-3939.2 Civic Plaza • Suite 200 • Newport Beach, CA 92660 • FAX (949) 644-393B www.freedomescrow.com Date: June 13, 2000 Escrow No: 34498-KR CITY OF NEWPORT BEACH 3300 Newport Blvd. Newport Beach, CA 92663 Attn: MARION BROCKMAN, City Manager Office Re: Property: 62 BEACON BAY, NEWPORT BEACH, CA 92660 An escrow has been opened in our office by JOHN DAVENPORT and CAROLINE DAVENPORT, for the sale of the above mentioned property, located at 62 BEACON BAY, NEWPORT BEACH, CA 92660. Enclosed please find check in the amount of $100.00 for transfer fee. We also enclose for your review certified copy of Escrow Instructions. Please prepare as soon as possible the following documents: - Termination of Lease - Memorandum of Lease - New Lease Agreement We would also appreciate a letter from you confirming amount of monthly lease payments the Seller currently pays, and verification that the payments are current. We have a very short escrow period. Thanking you in advance for your prompt attention to our request. Should you have any questions with regard to this matter, please don't hesitate to contact the undersigned. Very truly yours, KATHY RODRIGUEZ SENIOR ESCROW OFFICER kr (:PREEDCTM Telephone (949) 644.3939.2 Civic Plaza • Suite 200 • Newport Beach, CA 92660 • FAX (9491644-3938 www.fresdomescrow.com SUPPLEMENTAL ESCROW INSTRUCTIONS TO: Freedom Escrow Date: June 9, 2000 Escrow officer: KATHY RODRIGUEZ Escrow Number: 34498-KR The following instructions shall be deemed supplemental to those escrow instructions contained in that certain RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS dated 06108100, together with those certain Counter Offer(s) thereto, by and between JOHN DAVENPORT and CAROLINE, DAVENPORT, Seller herein, and CHAD E. STEELBERG and CRISTINA M. STEELBERG, Buyer herein, (hereafter, collectively, the "Agreement"). Terms of Transaction Buyer has deposited to escrow by Personal Check the sum of $ 45,000.00 Buyer will deposit, prior to close of escrow, the sum of $ 1,455,000.00 To Complete the Total Consideration of $ 1,500,000.00 A LEASEHOLD INTEREST IN Lot 1 of the Eastside Addition to Beacon Bay, in the City of Newport Beach, recorded on Official Maps, Book 2, Page 30, in the office of the County Recorder, County of Orange, State of California, sometimes referred to as Beacon Bay Lot 62. COMMONLY KNOWN AS: 62 BEACON BAY, NEWPORT BEACH, CA ' 92660 SHOWING TITLE VESTED IN: CHAD E. STEELBERG and CRISTINA M. STEELBERG, husband and wife as community property LAND LEASE WITH CITY OF NEWPORT BE, Parties instruct escrow holder to obtain a written demand from the City of Newport Beach, LEASEHOLDER, showing current leasehold payments, for proration and fees and requirements necessary for the transfer of ownership. Buyer's execution of new Lease with the City of Newport Beach shall be deemed their approval of all lease terms and conditions contained therein. Prior to close of escrow, escrow holder shall be handed Termination of Leasehold executed by Seller and City of Newport Beach, and new Memorandum of Lease executed by Buyer and City of Newport Beach, for recording herein at close of escrow. EARLY RELEASE OF FUNDS: From hands on deposit by Buyer, in the amount of $45,000.00, Escrow Holder is hereby authorized and instructed to release the sum of $25,000.00 to Seller, on June 19, 2000, following completion of all Buyer's inspections. Allparties hereto understand that escrow holder has made no warranty or representation of any kind, expressed or implied, as to the ownership of or title to the property described in this escrow,nor as to any encumbrances or liens thereon, nor as to the conditions and/or the ultimate outcome of this escrow„ nor in any manner or form as inducement to make the above payment. Furthermore, fully realizing that no instruments have been recorded, nor Policy of Title Insurance issued to protect buyer's interest in said property, all parties nevertheless request that this prior release be made. Escrow Holder is not to be held liable or responsible for, and is held harmless from, any loss or damage which might be sustained by reason of making this payment, nor liable for the failure of any of the conditions of this escrow, nor the recovery of said money for any reason whatsoever. funds released pursuant to this instruction shall represent a part of the total consideration, providing this transaction is consummated. Should this escrow cancel all parties agree that this release of funds is non-refundable. INSURANCE: Buyer to provide new hazard insurance, as required by Buyer's new lender, and Escrow Holder is instructed to pay first year's premium from funds deposited by buyer, at the close of escrow, unless provided with a paid -premium receipt. AUTHORIZATION TO PAY EXPENSES: Buyer and Seller are aware that Freedom Escrow may incur certain expense: during the course of processing this escrow which must be paid prior to the close of escrow. Such costs include, but are not limited to, association transfer fee and document fees, messenger fees, overnight mail service and city building reports, if applicable. Escrow Holder is authorized and instructed to release funds for payment of such costs, prior to the close of escrow, from funds deposited into escrow by Buyer. At close of escrow, Escrow Holder is authorized to charge the appropriate party for costs incurred. Should this escrow cancel Buyer and Seller are aware that monies disbursed are not refundable. Buyer and Seller agree to release escrow holder from any and all liability in connection with complying with this instruction. Seller Initials: ADDITIONAL INSTRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF My initials below represent my agreement and acknowledgment of the foregoing. Buyer Initials: — _ This IS 10 Certify that this is a Page i �FREEO(; 4 ESCROWe Kathy Rodriguez Senior Escrow Officer 6Us:19491644-3939 www.frdedomoscrow.com Fax:(949)6,44.3938 Freedom Escrow Date: June 9, 2000 Escrow No.: 34498-HR CONTINGENCY DATES: The following contingency dates have been agreed upon between Buyer and Seller: BUYER TO PROVIDE PROOF OF FUNDS JUNE 13, 2000 SELLER TO ORDER ALL REPORTS JUNE 13, 2000 BUYER TO COMPLETE ALL INSPECTIONS JUNE 19, 2000 ESCROW TO RELEASE FUNDS TO SELLER JUNE 19, 2000 BUYER APPROVAL OF ALL REPORTS 5 DAYS AFTER RECEIPT CLOSE OF ESCROW JULY 7, 2000 DEPOSIT DEEMS APPROVAL: All conditions of this escrow will be deemed to be satisfied or waived by Buyer upon Buyer's deposit into escrow of sufficient funds to close this escrow, and Buyer's deposit of said funds shall be deemed Escrow Holder's unconditional authorization to proceed with closing of this escrow. PROBATIONS: THE FOLLOWING PRORATIONS AND/OR ADJUSTMENTS ARE TO BE MADE AS OF: CLOSE OF ESCROW 1. Real Property Taxes based on latest available tax bills. 2. Homeowner's Association Dues based on the statement received from the Homeowner's Association or its representative: 3. Lease payment based on a statement to be handed to Escrow Holder by City of Newport Beach. There shall be no other prorations calculated herein unless instructed to the contrary by the -parties. ATTACHED AGREEMENT: BY PLACING THEIR INITIALS ON A COPY OF THE "AGREEMENT" WHICH IS ATTACHED HERETO AND MADE A PART HEREOF, THE UNDERSIGNED PARTIES HEREBY RATIFY AND APPROVE ALL TERMS AND PROVISIONS CONTAINED THEREIN AND AGREE TO BE BOUND THEREBY. THE INSTRUCTIONS CONTAINED THEREIN, SUBJECT TO THE FOREGOING, COMPRISE ALL OF OF THE INSTRUCTIONS. ADDITIONAL ESCROW INSTRUCTIONS AND PROVISIONS 1. DUTY AS ESCROW HOLDER/EXCULPATORY PROVISIONS: The parties hereby acknowledge that Freedom Escrow Corporation has the responsibilities of an Escrow Holder only and there are no other legal relationships established in the terms and conditions of the escrow instructions. The parties hereby acknowledge that (a) Escrow Holder is not an attorney or tax advisor; and (b) no communications between Escrow Holder and the parties hereto relating to this escrow shall be considered legal or tax advise. Freedom Escrow recommends that you seek proper legal and tax counsel before signing these instructions. Escrow Holder is to use its usual document forms or the usual forms of any title insurance company or title company and in these instructions insert dates and terms on the instruments if incomplete when executed. Escrow Holder shall have no obligation to inform any party of any other transaction or of facts within Escrow Holder's knowledge, even though the same concerns the property involved herein, provided such matters do not prevent- Escrow Holder's compliance with these instructions. Escrow Holder shall not be responsible for/(a)the sufficiency or correctness as to form or validity of any document deposited with Escrow Holder, (b) the manner of execution of any such deposited documents, unless such executions occur in Escrow Holder's premises and under its supervision, or (c) the identity, authority or rights of any person executing any document deposited with Escrow Holder. Escrow Holder's duties hereunder shall be limited to the safekeeping of such money and documents received as Escrow Holder, and for the disposition of the same in accordance with the written instructions accepted by Escrow Holder in this escrow. Unless otherwise instructed in writing, Escrow Holder shall not be required to take any action in connection with the collection, maturity or apparent outlaw of any obligation deposited in this escrow. Escrow Holder shall not be liable for any of its acts or omissions unless the same shall constitute gross negligence or willful misconduct. Escrow Holder's duty to act as Escrow Holder does not commence until these instructions, signed by all parties hereto, are received by Escrow Holder. However, release of Buyer's funds will require mutual signed release instructions from both Buyer and Seller, judicial decision, or arbitration award, pursuant to the CAR Real Estate Purchase Contract and Joint Escrow Instruction (and Receipt for Deposit). If the date by which Buyer's and Seller's performances are due shall be other than Escrow Holder's regular business day, such performances shall be due on the next succeeding business day. 2. DEMAND AUTHORIZATION: Escrow bolder is hereby authorized and instructed to obtain demand from lender(s) of record and to pay for same from Seller/Borrower's proceeds at the close of escrow, including prepayment penalties, interest adn such other costs, if applicable. 3. FUNDS RECEIVED IN ESCROW: All funds received in this escrow shall be deposited with a State or Federal bank with other escrow funds and disbursements shall be made by an escrow trust account check of Freedom Escrow. Checks not presented for payment within six months after date are subject to service charges in accordance with your schedule in effect from time to time. All documents and funds due the respective parties herein are to be mailed to the addresses provided to Escrow Holder. Our signatures on any documents and instructions pertaining to the escrow indicate our unconditional approval of same. Whenever provision is made herein for the payment of any sum, the delivery of any ADDITIONAL INSTRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF My initials below represent my agreement and acknowledgment ojtheloregoing. Thls is that this Is a Seller Initials: _ _ Buyer Initials: _ _ tN nd Corr of the Page 2 Freedom Escrow Date: June 9, 2000 Escrow No.: 34498-ER instrument or the performance of any act "outside of escrow", you as Escrow Holder shall have no responsibility therefore, shall not be concerned therewith and are specifically relieved of any obligation relative thereto. 4. CONFLICTING INSTRUCTIONS: All notices, demands and instructions must be in writing. In the event conflicting demands or notices are made or served upon Escrow Holder, or any controversy arises between the parties hereto or with any third person growing out of or relating to this .escrow, Escrow Holder shall have the absolute right to withhold and stop all further proceedings in, and performance of, this escrow, until Escrow Holder receives written notification satisfactory to Escrow Holder of the controversy by agreement of the parties hereto, or by the final judgment of a coumcompetent jurisdiction. All of the parties to this escrow hereby jointly and severally promise and agree to pay promptly on demand, as well as to indemnify Escrow Holder and to hold Escrow Holder harmless from and against all litigation and interpleader costs, damages, judgments, attorney's fees, expenses, obligations and liabilities of every kind which, in good faith, Escrow Holder may incur or suffer in connection,with or arising out of this escrow, whether said litigation, interpleader, obligation, liabilities or expenses arise during the performance of this escrow or subsequent thereto, directly or indirectly. Should Escrow Holder, before or after close of escrow, receive or become aware of any conflicting demands or claims with respect to the escrow, the rights of any party hereto or any funds, documents or property deposited with Escrow Holder, Escrow Holder may elect to do any or all of the following: Withhold performance of Escrow Holder's obligations and stop all further processing of this escrow pending resolution of any conflict by and between the parties hereto; and/or file an action in interpleader, pursuant to the section titled "Action in Interpleader". 5. AUTHORIZATION TO FURNISH COPIES AND COMPLY WITH LENDER'S INSTRUCTIONS: Escrow Holder is authorized to furnish copies of these instructions, supplements, amendments, notices of cancellation, closing statements and/or any other documents deposited in this escrow, to the real estate broker(s) representing the parties as evidenced by separate commission instructions, if necessary, and any lender to whom a party to this escrow had made application for a loan and/or the attorney(s) involved in this transaction. Escrow Holder is to follow the lender(s) instructions, if any. 6. TAXES: Escrow Holder is not to be held responsible in any way whatsoever for any personal property tax which may be assessed against any former or present owner of the subject property described in these escrow instructions, nor for the corporation or license tax of any, corporation as a former or present owner. 7. PRORATIONS AND ADJUSTMENTS: Escrow Holder is instructed to make prorations and adjustments on the following basis: (a) on a 30 day month, (b) taxes and.assessments on the latest information from the title company, or handed Escrow Holder, (c) fire insurance from premiums shown in policy(s) handed Escrow Holder and/or as shown on beneficiary's statement, and you may assume that necessary premiums have been paid and policy is in force, (d) interest from information shown in beneficiary statement, and (e) rents from statement handed you by Seller or agent thereof, (f) Homeowner's Association dues from statement deposited into escrow by the Homeowner's -Association or their management company. The phrase "close of escrow" (COE) as used in this escrow is the date on which documents are recorded and relates only to prorations and/or adjustments unless otherwise specified. 8. INSURANCE: In instances wherein Buyer is purchasing a new policy of insurance, it shall be the Seller's responsibility to cancel the existing insurance policy. 9. EXECUTION OF ESCROW INSTRUCTIONS AND ADDENDA: These instructions may be executed in counterparts, each of which shall be deemed an original regardless of the date of its execution and delivery. All such counterparts shall constitute one and the same document. A parry's signature on all instruments and instructions pertaining to this escrow indicates that parry's unconditional acceptance and approval of same. No notice, demand or change or instruction shall be effective unless executed and in writing. Any amended, supplemented or additional instruction shall be subject to the foregoing conditions. 10. REPORTING TRANSACTIONS: Escrow Holder is required by law to report the total "gross" proceeds (total consideration/sales price) on all real estate sales to the IRS at closing. In addition, parties are further made aware that Escrow Holder will also be required by H.R. 638 "Home Sale Tax Fairness Act of 1992" to report to I.R.S. the amount of real estate property taxes apportioned between the parties at close of escrow. Seller is to complete, sign and return a Seller's Certification for Real Estate Report Requirements to Escrow Holder, (all sellers MUST sign), and this escrow MAY NOT CLOSE if this form is not received prior to closing. This is an I.R.S. requirement, and any questions should be directed to the Unites States Treasury Department and not to Escrow Holder. NOTE: Corporations are automatically exempt from I.R.S. 1099 reporting. 11. USURY: Escrow Holder is not to be concerned with any question of usury in any loan or encumbrance involved in the processing of this escrow and Escrow Holder is hereby released of any responsibility or liability therefore. 12. SIGNATURE: All parties to this transaction instruct Escrow Holder to accept signatures forwarded herein via Fax Machine (faxed signatures) to close escrow, with the original thereof signed to be forwarded to Escrow Holder directly upon such faxing. WE THE UNDERSIGNED WILL FORWARD THE ORIGINAL SIGNATURES VIA REGULAR MAIL, acknowledging the Corporate Commissioner of the State of California requests original signatures on all files. 13. DISCLOSURES: Escrow Holder is not to be concerned with the giving of any disclosures required by Federal or State law, specifically but not exclusively, RESPA (Real Estate Settlement Procedures Act), Regulation Z (Truth in Lending disclosures), Zone Disclosure Reports or other warnings, the release or discharge of hazardous or toxic wastes on the subject property in the past, present or future, or any warranties, express or implied. Neither is Escrow Holder to be concerned with the effect of zoning ordinances, land division regµlations, or building restrictions which may pertain to or affect the land or improvements that are the subject of this escrow. ADDITIONAL INSTRUCTION$ ATTACHED'HERETO AND MADE APART HEREOF My inikats'helow represent my agreement and ackngw(ddgment of the foregoing. Seller Initials: Buyer Initials: -- This 15 ertiiytha his Is a — — Ifugciind correft , of the Page 3 Freedom Escrow Date: June 9, 2000 Escrow No.: 34498-ER 14. SUBDIVISION MAP ACT: The parties to this escrow have satisfied themselves outside of escrow that the transaction covered by this escrow is not in violation of the Subdivision Map Act or any other law regulating land division, and you as Escrow Holder are relieved of all responsibility and/or liability in connection therewith and are not to be concerned with the enforcement of said laws. 15. DESTRUCTION OF FILES: Escrow Holder is authorized to destroy or otherwise dispose of any and all documents, papers, escrow instructions, correspondence and records or other material constituting or pertaining to this escrow at any time after five (5) years from the date of: (1) the close of escrow: (2) the date of cancellation: or (3) the date of last activity without liability and without further notice to the parties. A nominal fee of $25.00 will be charged to retrieve a file from storage after six months from the COE. 16. � � EDOM ESCROW: This company is an independent escrow company licensed by the 'Department of Corporations, State of California, License no. 963-0422. 17. THIS AGREEMENT: This agreement in all its parts applies and inures to the benefit of and binds all parties hereto , their heirs, legatees, devises, administrators, executors, successors and assigns, and whenever the context so requires, the masculine gender includes the feminine gender and neuter, and the singular number includes the plural. All parties indemnify Escrow Holder against forgery in the execution of any/all instructions/documents in this transaction. BUYER(S): CHAD STEELBERG CRISTINA STEELBERG SELLER(S): JOHN DAVENPORT CAROLINE DAVENPORT - - END OF INSTRUCTIONS - - ThIS Is to Ce Is Ise true a tract t the Page 4 FREEDOM ESCROW TRUSTACCOUNT 2 CIVIC PLAZA, SUITE 200 NEWPORT BEACH, CA 92660 949/644-3939 One Hundred And 00/100 Dollars PAY CITY OF NEWPORT BEACH TOTHE ORDER 3300 Newport Blvd. ORDER OR Newport Beach, CA 92663 4M* QWNATIOKiL BANK specialty Deposit Comtora . CA MO ESCROW NO. 34498-k-R 10Sto? ' I:i220L60661: Oi311i98950ti' FREEDOM ESCROW, Trust Account, Newport Beach, CA 92660 16.160611220 105473 DATE 06/13/00 AMOUNT $ 100.00 Days Check No. 105473 105473 f Date: 06/13/00 (kr )Escrow No.34498-YR CheckAmount$ 100.00 SELLER:JOHN DAVENPORT CAROLINE DAVENPORT BUYER:CHAD E.STEELBERG CRISTINA M STEELBERG Funds Due Property : 62 BEACON BAY NEWPORT BEACH, CA 92660 ADDITIONAL INFORMATION: Leasehold Transfer Fee We Appreciate Your Business! CITY OF NEWPORT BEACH OFFICE OF THE CITY MANAGER JUNE191 1996 TO: FINANCE DEPARTMENT FROM: ASSISTANT TO CITY MANAGER SUBJECT: RENT & OWNER CHANGE FOR 62 BEACON BAY A new lease was signed for subject property (62 Beacon Bay) on June 12, 1996. The new monthly rental is $1,810.94. Please bill this new amount to new owners, Johnb Davenport and Caroline Davenport at 62 Beacon Bay. Attached are copies of rents paid to July 1, 1996 Thanks, Marion Brockman mb Attachments _ _ First Interstate Bank of California New MARINERS Newport Center Office No. 9 5 0 9 6 ESCROW CORPORATION 1 Civic Center Plaza, Salle 200 190 NEWPORT CENTER DRIVE, SUITE 250 Newport Beach, CA 92666 16.21/270 NEWPORT BEACH • CA 92660 (714)640-6040 ESCROW DATE 1220 12574-EM June 13, 1996 PAY Nine Hundred Seventy Five And 33/100 Dollars------------------------ $ 975.33 TOTHE t C27 ORDER OF City of Newport Beach Marion Brockman 3300 Newport Boulevard Newport Beach, CA 92663 v09509P=v r:i220002i8C2703i7'9701t' 11 Please detach and retain this statement for your records. The attached check is payment for the items described below. Please notify us immediately if this Is Incorrect. No. 950,96 MARINEPA&S&%Y JR jtS 3jATION 190 Newport ejr t&r�?%$ S W Ne��r� 16 CA 92660 • (714) 640(%&k # 95096 Issued: 06/13/96 Funds Due You $ **********975.33 Property: 62 Beacon Bay Newport Beach, CA 92663 Seller: C. Rent Freundt Barbara Casey Freundt Buyer: John Davenport Caroline Davenport Lease payment from 6/1/96 to 6/12/96 @2,660.00 Thank you for doing business with Mariners Escrow Corporation First Interstate qq��,�f California MARINERS Newport Center*e ESCROW CORPORATION 1 Civic Center Plaza, Suite 200 190 NEWPORT CENTER DRIVE, SUITE 250 Newport Beach, CA 92660 NEWPORT BEACH • CA 92660 (714)640-6040 ESCROW DATE 12574-DR June 13, 1996 PAY One Thousand One Hundred Forty Six And 93/100 Dollars----------- �— TOTHE r ORDER OF City of Newport Beach Marion 3300 Newport Boulevard Newport Beach, CA 92663 tl■0950941t' 1:i220002i81:2703179?UlI' 11 ESCROW :row Trust No. 95097 16-21/270 1220 $ 1,146.93 Please detach and retain this statement for your records. NO. 9 5 0 9 7 The attached check Is payment for the items described below. Please notify us immediately if this is Incorrect. MARINERS jEgF&0 Cqja�j�kTION 190 Newport Cta 6ppkveo�uik?5�b.?w"�q@A 92660 • (714) 640-6dqeck # 95097 Issued: 06/13/96 Funds Due You $ ********1,146.S Property: 62 Beacon Bay Newport Beach, CA 92663 Seller: C. Kant Freundt Buyer: John Davenport Barbara Casey Freundt Caroline Davenport Lease pymt. from 6/12/96 to 7/1/96 @1810.94 Thank you for doing business with Mariners Escrow Corporation DISPLAY BUSINESS RECORDS. DISPLAY EXIT • DISPLAY BUSINESS RECORDS --------------------------------------------------------------------- 06/05/96 BUSINESS NUMBER BB-0062-0 TOTAL DUE 2660.00 Alt BUSINESS NAME KENT, C/FREUNDT, B SERVICE ADDRESS 62 BEACON BAY APT NEWPORT BEACH, CA BILLING ADDRESS 18201 VON KARMAN AVE, STE 900 C/O TRANSAMERICA IRVINE, CA 92715 ZIP 92660 CYCLE W TAX N PROPERTY ID 050-212-10 UNAPPLIED CREDIT PENALTY N 0.00 SERVICE TITLE BILL REF DATE BILLED PAID DATE PAID LEASE50 LEASE 1996-06 05/20/96 2660.00 0.00 LEASE50 LEASE 1996-05 04/18/96 2660.00 2660.00 05/02/96 LEASE50 LEASE 1996-04 03/19/96 2660.00 2660.00 04/04/96 LEASE50 LEASE 1996-03 02/22/96 2660.00 2660.00 03/05/96 LEASE50 LEASE 1996-02 01/17/96 2660.00 2660.00 02/06/96 PRESS ESCAPE FOR NEXT SCREEN A", MARINERS 1011w ESCROW CORPORATION May 28, 1996 City of Newport Beach 3300 Newport Boulevard Newport Beach, Ca 92663 Attn: City Managers Office/Marianne Re: 12574-DM 190 Newport Center Drive, Suite 250 Newport Beach, California 92660 Post Office Box 8808 Newport Beach, California 92658 Phone (714) 640-6040 Pax (714) 721.9157 In connection with the above mentioned escrow, enclosed herewith please find the following: 1. Executed Termination of Lease. 2. Executed Memorandum of Lease 3. Executed Beacon Bay Lease(2) PLEASE HAVE THE ABOVE DOCUMENT SIGNED AS SOON AS POSSIBLE. PLEASE CALL THE UNDERSIGNED AS SOON AS SAID DOCUMENTS ARE READY FOR A MESSENGER PICKUP. We appreciate the opportunity to be of service to you in this transaction. Should you have any questions, please call us at the telephone number(s) referenced above. Escrow Corporation DISPLAY BUSINESS RECORDS DISPLAY EXIT DISPLAY BUSINESS RECORDS --------------------------------------------------------------------- 06/05/96 BUSINESS NUMBER BB-0062-0 TOTAL DUE 2660.00 BUSINESS NAME KENT, C/FREUNDT, B SERVICE ADDRESS 62 BEACON BAY APT NEWPORT BEACH, CA BILLING ADDRESS 18201 VON KARMAN AVE, STE 900 C/O TRANSAMERICA IRVINE, CA 92715 ZIP 92660 CYCLE W TAX N PROPERTY ID 050-212-10 UNAPPLIED CREDIT PENALTY N 0.00 SERVICE TITLE BILL REF DATE BILLED PAID DATE PAID LEASE50 LEASE 1996-06 05/20/96 2660.00 0.00 LEASE50 LEASE 1996-05 04/18/96 2660.00 2660.00 05/02/96 LEASE50 LEASE 1996-04 03/19/96 2660.00 2660.00 04/04/96 LEASE50 LEASE 1996-03 02/22/96 2660.00 2660.00 03/05/96 LEASE50 LEASE 1996-02 01/17/96 2660.00 2660.00 02/06/96 PRESS ESCAPE FOR NEXT SCREEN E CITY OF NEWPORT BEACH Office of City Manager (714) 644-3002 May 15, 1996 Dana McNeill Mariners Escrow Corporation 190 Newport Center Drive Suite 250 Newport Beach, CA 92660 Subject: 62 Beacon Bay #12574-DM Enclosed please find two original leases, a Termination of Lease, and a Memorandum of Lease. Please have all documents signed and the Memorandum and Termination of Lease notarized, and return to the City for signatures. mb enclosures Sincerely, i Marion Brockman Assistant to Peggy Ducey City Hall • 3300 Newport Boulevard • Newport Beach, California 92663-3884 MARINERS r 1• ESCROW CORPORATION 190 NEWPORT CENTER DRIVE `6# NEWPORT BEACH • CALIFORNIA 92660 (714) 640-6040 PAY TO THE ORDER 1 �� First .1 Cle 1onYlo70 l' OI CeIXOm4 e, Nawpml Canlm OMm Interstate Now,,ol Bea h, CA OtM Bank FOR u'0069 191I' 1: 1 2 2000 2 18i: 2 70 31 0961311' L L 6919 16.2111220 O6wnvl l.uu,u o." urn. W wa 0 MARINERS ■� 1• ESCROW CORPORATION •♦ , 190NEWPORTCENTER DRIVE �670' NEWPORT13EACH • CALIFORNIA 92660 (714)640.6040 PAY r TO THE ,ORDEROF 5 * rl 1/ Flnt Mx a.'270 tatFk►sPn8u Inters 1; FOR�- 11200691911' 1: 1 2 2000 2181: 270 11796811' i 1 6919 n 16-2111220 DOLLARS Ul=' 0 MARINERS ® ESCROW CORPORATION April30, 1996 4S1vE G�` City of Newport Beach a� d nV' toy 3300 Newport Boulevard Newport Beach, Ca 92663 oz� Attn: City Managers Office/Marianne Re: 12574-DM 190 Newport Center Drive, Suite 250 Newport Beach, California 92660 Post orfwc Box 8808 Newport Beach, California 92658 Phone (7141 640-6040 Pnx (7141 721-8157 In connection with the above mentioned escrow, enclosed herewith please find the following: 1. Certified Escrow Instructions 2. Check in the amount of $100.00 PLEASE FURNISH MARINERS ESCROW CORPORATION WITH ALL LEASEHOLD DOCUMENTS IN CONNECTION WITH BEACON BAY. Please contact the undersigned when said documents are ready for a messenger pickup. to be of service to you in this transaction. Should you have any questions, please call us at the d above. MARINERS 190 Newport Center Drive, nia 9 660 Newport Beach, California 92GG0 (01 ESCROW CORPORATION Peet office Box 2658 Newport Beach, California 92658 Phone (714) 640-6040 Pox (7141 721.8157 1WRO SALE ESCROW INSTRUCTIONS TO: Mariners Escrow Corporation Date: April 26, 1996 Escrow officer: Dana McNeill Escrow Number: 12574-DM Joha Davenport and Caroline Davenport, (hereinafter known as Buyer) agree to purchase from C. Kent Freundt and Barbara Casey Fretindt, (hereinafter known as Seller) the real property setforth herein per the terms, conditions, consideration and instructions hereinafter stated. The Seller and Buyer herein shall deliver these signed escrow instructions to Mariners Escrow Corporation, (hereinafter known as Escrow Holder), within 7 calendar days after receipt of same. Terms of Transaction I will Deposit into Escrow the sum of $ 20,000.00 I will Deposit, prior to close of escrow, the sum of a $ 240,775.00 I will Obtain a New First Trust Deed loan in the amount of A ?J I q $ 608,475.00 gyp, To Complete the Total Consideration of y 1 0 $ 869,250.00 Buyer will hand Escrow Holder an initial deposit of $20,000.00 and, prior to the close of escrow, will deposit the balance of the cash down payment and any additional funds and instruments necessary to enable Escrow Holder to comply with these instructions, all of which Escrow Holder is instructed to use provided that on or before June 10, 1996, the closing date of escrow, Escrow Holder holds a(n) Owners Policy of Title Insurance with the usual title company's exceptions, with a liability of not less than $869,250.00, covering property in the County of Orange, State of California, described as follows: A leasehold interest in Lot 1 or the eastside addition to Beacon Bay recorded on Official Maps in Book 2, Page 30 in the office of the County Recorder, County of Orange, State of California sometimes referred to as Beacon Bay Lot 62. COMMONLY KNOWN As: 62 Beacon Bay, Newport Beach, CA 92663 SHOWING TITLE VESTED IN: John Davenport and Caroline Davenport, Husband and Wife SUBJECT TO: (1) General and Special County and City (if any) Taxes for the current fiscal year, not due or delinquent, including any special levies, payments for which are included therein and collected therewith. (2) Lien of Supplemental Taxes, if any, assessed pursuant to the provisions of Chapter 3.5 (commencing with Section 75) of the Revenue and Taxation Code of the State of California. (3) Covenants, Conditions and Restrictions, reservations easements for public utilities, districts, water companies, alleys and streets, rights and rights of way of record, if any; also exceptions of oil, gas, minerals and hydrocarbons, and/or lease, if any, without the right of surface entry. (4) A New Conventional First Trust Deed to record, to secure a Note in the principal amount of $608,475.00 in favor of , as per its terms and conditions to be placed in escrow. Buyer's/Borrower's execution of the loan documents shall be deemed their full approval of all terms and conditions contained therein. All costs and charges incurred to obtain said new financing shall be borne by Buyer/Borrower. You are authorized and instructed to comply with the instructions of the Lender as they may be deposited into escrow. INSTRUCTIONS TO ESCROW DELIVER SIGNED ESCROW INSTRUCTIONS: Escrow Instructions shall be signed by Buyer and Seller and delivered to Mariners Escrow Corporation, the designated Escrow Holder, within 7 calendar days from above date. Buyer and Seller hereby jointly instruct Escrow Holder and Broker that Buyer's deposit placed into escrow will be held as a good faith deposit towards the completion of this transaction. Escrow shall close on or before June 10, 1996. ESCROW INSTRUCTIONS/PURCHASE CONTRACT: Buyer and Seller are hereby advised that the escrow instructions may include matters required to close this transaction which are not covered by the Real Estate Purchase Contract dated . The omission from Escrow Instructions of any provision in the Real Estate Purchase Contract , shall not constitute a waiver of the provision or the contractual rights or obligations of any party. Any change in terms or provisions of this Agreement requires Se Continued on Page 2 NSTRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF s betow represent aty agreement and acknowledgment of the foregoing. Buyer Initials: _ Page 1 Mariners Escrow Corp• tion Date: April 26, 1996 Escrow No.: 12574-DM Continued from Page I mutual, written consent of Buyer and Seller. NEW FINANCING: It is understood and agreed between the parties herein that the close of this escrow is contingent upon Buyer and property qualifying for and obtaining a new loan as set forth in Item (4) above by May 26, 1996. LOAN APPLICATION/PREQUALMCATION: On or before May 6, 1996, (within 10 days of acceptance of offer), Buyer shall provide to Seller a letter from lender stating that, based on a review of Buyer's written application and credit report, Buyer is prequalified for the NEW and/or ASSUMED loans indicated above. If Buyer fails to provide such letter within that time, Seller may cancel this Agreement in writing. In the event Buyer and Seller agree to execute mutual cancellation instructions to Escrow Holder. ACTIVE REMOVAL (1) If Buyer does not give to Seller written notice of removal of all contingencies (including the contingency of obtaining loans, if applicable), or of items reasonably disapproved, or of cancellation (based on inability to obtain loans, if applicable, or based on any other cancellation right of Buyer), within the strict time periods specified, Seller shall have the right to cancel this Agreement in writing. (2) If Buyer does give to Seller written notice of items reasonably disapproved, within the strict time periods specified, Seller shall have 5 days in which to respond in writing. (3) If Seller's response indicates that Seller is unwilling or unable to repair or correct any items reasonably disapproved by Buyer, or if Seller does not respond within the strict time period specified, Buyer shall have 5 days (after receipt of Seller's response, or after the expiration of the time for Seller to respond, whichever occurs first) to either cancel this Agreement, or elect to proceed, in writing. (4) It Buyer does not give such written notice of cancellation or of election to proceed pursuant to paragraph (3) above within the strict time period specified, Seller shall have the right to cancel this Agreement by giving written notice to Buyer. PRELIMINARY TITLE REPORT: The closing of this escrow is contingent upon Buyer's approval of an up-to-date Preliminary Title Report, issued by Fidelity National Title Insurance Company, within 5 calendar days of receipt of same by Buyer. Buyer to notify Escrow Holder pursuant to the "Active Method" within the time limit specified herein, of Buyer's approval or disapproval of the condition of title. Any items disclosed to or discovered by Buyer prior to close of escrow, but after receipt of the Preliminary Title Report, shall be approved or disapproved by Buyer within the strict time period specified pursuant to the "Active Method". INSPECTIONS: Buyer's acceptance of the condition of the Property is a contingency of this escrow. Buyer shall have the right to conduct inspections, investigations, testi, surveys, and other studies ("Inspections") at Buyer's expense. Buyer shall, on or before May 10, 1996 (within 14 calendar days from date of acceptance) complete all inspections including the Geological Inspection and shall notify Seller in writing of any items(s) disapproved. PEST CONTROL: On or before May 10, 1996, (within 14 calendar days after acceptance of the offer)„ Seller shall furnish Buyer at the expense of Seller, a current written report of an inspection by , a registered Structural Pest Control Company, of the mail building, attached structures and detached garage(s) or carport(s) and decks, if applicable. If the Property is a unit in a condominium, planned development, or residential stock cooperative, the Report shall cover only the separate interest and any exclusive -use areas being transferred, and shall NOT cover common areas. If requested by Buyer or Seller, the Report shall separately identify each recommendation for corrective work as follows: "Section 1" - Infestation or infection which is evident. "Section 2" - Conditions which are present and deemed likely to lead to infestation or infection. If no infestation or infection by wood destroying pests or organisms is found, the report shall include a written Certification as provided in Business and Professions Code Section 8519(a) and 8519(b) that on the inspection date "no evidence of active infestation or infection was found". Work recommended to correct conditions described in "Section 1" shall be at the expense of Seller. Work recommended to correct conditions described in "Section 2", if requested by Buyer, shall be at the expense of Buyer. If inspection of inaccessible areas is recommended in the report, Buyer has the option to accept and approve the report, or within calendar days after receipt of the report to request in writing further inspection be made. Buyer's failure to notify Seller and Escrow Holder in writing of such request shall conclusively be considered approval of the report. If further inspection recornmends "Section 1" and/or "Section 2" corrective work, such work, and the inspection, entry and closing of the inaccessible areas, shall be at the expense of the respective party designated above for each type. If no infestation or infection is found, the cost of inspection, entry and closing of the inaccessible areas shall be at the expense of Buyer. Inspections, corrective work and certification under this paragraph shall not include roof covering(s). Nothing in this Paragraph shall relieve Seller of the obligation, if any, to repair or replace shower parts and shower enclosures, if required. A WATER TEST OF SHOWER PANS MAY NOT BE PERFORMED ON UNITS ON AN UPPER LEVEL WITHOUT THE Selle Continued on Page 3 TRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF =low represent my agreement and acknowledgment of theforegoing. Buyer Initials: Page 2 Mariners Escrow Corporation Date: April26, 1996 Escrow No.: 12574-DM Continued from Page 2 CONSENT OF THE OWNERS OF PROPERTY BELOW THE SHOWER. Work to be performed at Seller's expense may be performed by Seller or through others, provided that all required permits and final inspections are obtained; and upon completion of repairs a Certification is issued by a registered Structural Pest Control Company showing that the inspected property "is now free of evidence of active infestation or infection". If Buyer and Seller agree that work to be performed at Seller's expense will be done after the close of escrow, funds in an amount equal to one and one half (1 1/2) times the amount of the approved estimate shall be held in escrow unless otherwise agreed in writing. Such funds shall be disbursed upon your receipt of written Certification as provided in Business and Professions Code Section 8519(b) that the inspected property "is now free of evidence of active infestation or infection". Any funds retraining shall be returned to Seller. RESIDENTIAL PROPERTY REPORT: Seller herein agrees to provide Buyer with a City of Newport Beach Residential Building Report for Buyer's approval. In the event Seller does not bring property into compliance as indicated in said report and Buyer elects not to cancel the contract, Buyer acknowledges that Buyer may be required to expend additional sums to bring the property into compliance. Having been so advised, Buyer holds Escrow Holder, Seller, Broker and Broker's Agents harmless form any and all claims, losses or liability arising out of such matters. HOME WARRANTY: Buyer is to be provided with a Home Warranty Policy, issued by Company of Buyer's choice, the premium for which is to be paid by Seller. Escrow Holder's only concern with said policy shall be to pay the premium for same from Seller's proceeds at close of escrow, per billing to be placed in escrow, in an amount not to exceed $350.00. Said home warranty to include optional roof coverage. HOMEOWNER'S ASSOCIATION: Buyer is aware that there is a Homeowners Association in connection with the property being conveyed in this escrow with a annual association fee payable in the approximate amount of $750.00. Escrow Holder is instructed to obtain a statement from said association as to the status of the account and to charge the account of Seller herein with any amount owing thereon, and for any documents obtained on behalf of Seller. Charge the account of Seller with amount of transfer fee, if any. APPROVAL OF ASSOCIATION DOCUMENTS: As soon as practicable, Seller shall provide Buyer, at Seller's expense, with copies of Covenants, Conditions and Restrictions, Articles of Incorporation, By-laws, Current Rules and Regulations, most Current financial Statements, and most recent twelve (12) months Association Minutes, if available, and any other documents as required by law. Seller shall disclose in writing any known pending special assessment, claims or litigation to Buyer. No warranty is made regarding the Property's compliance with any governing document or Homeowner's Association requirements, unless agreed in writing. Buyer shall be allowed 7 calendar days from receipt to review these documents and to respond pursuant to the "Active Method". If such documents disclose conditions or information unsatisfactory to Buyer, Buyer may cancel this agreement, and in such event Buyer and Seller will execute mutual cancellation instructions. FIRE INSURANCE Obtain new fire insurance on the subject property being encumbered through this escrow, in an amount required by lender (or at least the amount equal to the guaranteed replacement cost if lender makes no other requirement) on the buildings situated on the property. Said policy shall show lender(s) named herein as loss payee(s) in the same priority position as stated hereinabove. You are instructed to pay the premium on any policy submitted into this escrow on behalf of borrower(s) in accordance with lender's requirement (or for one year in advance if leader makes no other requirement) from loan proceeds at close of escrow. INCURRED EXPENSES: Buyer and Seller are aware that Mariners Escrow Corporation may incur certain expenses during the course of processing this escrow which may be paid prior to the close of escrow. Such costs may include, but are not limited to, courier fees, overnight mail service, Homeowner's Association documents/transfer fees and City Building Reports, if applicable. Escrow Holder is authorized and instructed to release funds for payment of such costs, prior to the close of escrow, from funds deposited into escrow by Buyer. In the event Escrow Holder advances funds for certain costs described above, Escrow Holder is authorized to reimburse Escrow Holder's general account upon receipt of these signed escrow instructions from both Buyer and Seller. At close of escrow, Escrow Holder is authorized to charge the appropriate party for costs incurred, and is released form any and all liability in connection with complying with this instruction. PROBATIONS: Escrow Holder is authorized and instructed to make the following prorations as of the date of close of escrow: 1. General and Special County and City Taxes based on latest available tax bills. 2. Leasehold interest 3. Homeowners Association dues Continued on Page 4 JSTRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF below represent my agreement and acknowledgment of the foregoing. Buyer Initials: Page 3 Mariners Escrow Corporation Date: April 26, 1996 Escrow No.: 12574-DM Continued from Page 3 BUYER'S FINAL DEPOSIT: All conditions off this escrow will be deemed to be satisfied or waived by Buyer upon Buyer's deposit into escrow of sufficient funds to close this escrow, and Buyer's deposit of said funds shall be deemed Escrow Holder's unconditional authorization to proceed with closing this escrow. AS A MATTER OF MEMORANDUM ONLY THE FOLLOWING IS ENTERED AS A MEMORANDUM ONLY, AT THE REQUEST OF THE PARTIES, AND REFLECTS INFORMATION THAT IS CONTAINED IN THE ORIGINAL PURCHASE CONTRACT, WITH WHICH ESCROW HOLDER SHALL HAVE NO DUTY: POSSESSION AND OCCUPANCY: Possession and occupancy of subject property shall be delivered to Buyer no later than 2 days from the close of escrow at 1:00PM. REPAIRS: Repairs under this Agreement shall be completed prior to close of escrow, unless otherwise agreed in writing, and shall be performed in compliance with applicable governmental permit, inspection, and approval requirements. It is understood that exact restoration of appearance or cosmetic items following all such Repairs may not be possible. Repairs shall be performed in a skillful manner with materials of quality comparable to that of existing materials. SELLER WARRANTY: Seller warrants that at the time possession is made available to Buyer: (1) Roof shall be free of leaks KNOWN to Seller or DISCOVERED during escrow. (2) Built-in appliances (including free-standing oven and range, if included in sale), plumbing, heating, air conditioning, electrical, water, sewer/septic, and pool/spa systems, if any, shall be operative. (3) Plumbing systems, shower pans, and shower enclosures shall be free of leaks KNOWN to Seller or DISCOVERED during escrow. (4) All fire, safety, and structural defects in chimneys and fireplaces KNOWN to Seller or DISCOVERED during escrow shall be repaired by Seller. (5) All broken or cracked glass, and torn existing window and door screens, shall be replaced. (6) Property, including pool/spa, landscaping, and grounds, shall be maintained in substantially the same condition as on the date of acceptance of the offer. (7) SELLER SHALL HAVE WATER, GAS, AND ELECTRICAL UTILITIES ON FOR BUYER'S INSPECTIONS AND THROUGH THE DATE POSSESSION IS MADE AVAILABLE TO BUYER. (8) All debris and all personal property not included in the sale shall be removed. NOTE TO BUYER: This warranty is limited to items specified in this Paragraph 8A, items discovered in Buyer's Inspections which are not covered by this Paragraph shall be governed by the procedure in Paragraphs 7 and 28 of CAR Form Revised 8/94. NOTE TO SELLER: Disclosures in the Real Estate Transfer Disclosure Statement (C.A.R. Form TDS-14), and items discovered in Buyer's Inspections, do NOT eliminate Seller's obligations under this warranty unless specifically agreed in writing. TRANSFER DISCLOSURE STATEMENT; MELLO-ROOS NOTICE: Unless exempt: A. A Real Estate Transfer Disclosure Statement (TDS) (C.A.R. Form TDS-14) shall be completed by Seller and delivered to Buyer (Civil Code §§1102-1102.15). Buyer shall sign and return a copy of the TDS to Seller or Seller's Agent. Buyer shall be provided a TDS by May 3, 1996 (within 7 calendar days of acceptance of offer), unless previously provided to Buyer. B. Seller shall make a good faith effort to obtain a disclosure notice from any local agencies which levy on the Property a special tax pursuant to the Mello -Roos Community Facilities Act, and shall promptly deliver to Buyer any such notice made available by those agencies. C. If the TDS or the Mello -Roos disclosure notice is delivered to Buyer after the offer is signed, Buyer shall have the right to terminate this Agreement, within three (3) days after delivery in person, or five (5) days after delivery by deposit in the mail, by giving written notice of termination to Seller or Seller's agent. D. Disclosure in the TDS, or exemptions from providing it, do not eliminate Seller's obligation to disclose known material defects, or to meet Seller's other obligations under this Agreement. FIXTURES: All EXISTING fixtures and fittings that are attached to the Property, or for which special openings have been made, are INCLUDED IN THE PURCHASE PRICE, free of liens. These include, but are not limited to, existing electrical, lighting, plumbing and heating fixtures, fireplace inserts, solar systems, built-in appliances, screens, awnings, shutters, window coverings, attached floor coverings, television antennas, satellite dishes and related equipment, private integrated telephone systems, air coolers/conditioners, pool/spa equipment, water softeners (if owned by Seller), security systems/alarms (if owned by Seller), garage door openers/remote controls, attached fireplace equipment, mailbox, in -ground landscaping including trees/shrubs. . GOVERNMENTAL COMPLIANCE: Continued on Page 5 ADDITIONAL INSTRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF BE p Ii� Uffi NAb`elow represent my agreement and acknowledgment of the foregoing. Seller I C0 1CZ 10 OF ENE 0R�0 Buyer Initials: Page 4 8AR1N ESCROW , • 0 Matiners Escrow Corporation Date: April 26, 1996 Escrow No.: 12574-DM Continued from Page 4 A. Seller represents that Seller has no knowledge of any notice, filed or issued against the Property, of violations of city, county, state, or federal building, zoning, fire, or health laws, codes, statutes, ordinances, regulations, or rules . B. Seller shall promptly disclose to Buyer any improvements, additions, alterations, or repairs ("Repairs") made by Seller or known to Seller to have been made without required governmental permits, final inspections, and approvals. C. If Seller receives notice or is made aware of any of the above violations prior to close of escrow, Seller shall immediately notify Buyer in writing Buyer shall, within the time specified, provide written notice to Seller of any items disapproved. D. Nothing in this Paragraph relieves Seller of any other obligations in this Agreement. Neither Buyer nor Seller shall be required to make Repairs to the Property for any purpose, unless agreed in writing between Buyer and Seller, or required by law as a condition of closing escrow. No warranty is made concerning the presence or absence of building permits or inspections, or compliance or lack of compliance with building codes, unless agreed in writing. SMOKE DETECTOR(S): State law requires that residences be equipped with operable smoke detector(s). Local law may impose additional requirements. Unless exempt, Seller shall, prior to close of escrow, provide to Buyer a written statement of compliance and any other documents required, in accordance with applicable state and local law. (SMOKE DETECTOR STATEMENT OF COMPLIANCE (C.A.R. Form SDC41) SHALL SATISFY THE STATE PORTION OF THIS REQUIREMENT.) Additional smoke detector(s), if required, shall be installed at Seller's expense prior to close of escrow. GEOLOGIC, EARTHQUAKE AND SEISMIC HAZARD ZONES DISCLOSURE: If the Property is located in an Earthquake Fault Zone (Special Studies Zone) (EFZ), (Public Resources Code §§2621-2625), Seismic Hazard Zone (SHZ) (Public Resources Code §§2690-2699.6), or in a locally designated geologic, seismic, or other hazard zone or area where disclosure is required by law, Seller shall, on or before May 10, 1996, (within 14 calendar days after acceptance of the offer), disclose in writing to the Buyer in writing these facts and any other information required by law. (GEOLOGIC, SEISMIC AND FLOOD HAZARD DISCLOSURE SHALL SATISFY THIS REQUIREMENT.) Construction or development of any structure may be restricted in such zones. Disclosure of EFZs and SHZs is required only if maps, or information contained in such maps are "reasonably available" (Public Resources Code §§2621.9(c)(1) and 2694(c)(1)). Buyer is allowed 7 calendar days after receipt of the disclosure(s) to make further inquires at appropriate government agencies, lender, insurance agents, or other appropriate entities concerning use of the property under local building, zoning, fire, health and safety codes as may be applicable under the Special Studies Zone Act, Seismic Hazards Mapping Act and local geologic ordinance(s). Buyer shall provide written notice to Seller and Escrow Holder of any items disapproved within this latter time period. SUBSEQUENT DISCLOSURE: In the event Seller, prior to the close of escrow, becomes aware of adverse conditions materially affecting the Property, or any material inaccuracy in disclosures, information, or representations previously provided to Buyer (including those made in a Real Estate Transfer Disclosure Statement (TDS) pursuant to Civil Code Section 1102, et seq.), Seller shall promptly provide a supplemental or amended disclosure in writing, covering those items. If Buyer disapproves of any conditions so disclosed, Buyer may terminate this Agreement under the procedure in paragraph C of the Transfer Disclosure Paragraph. BUYER'S SOLE REMEDY REGARDING DISCLOSURES: Buyer and Seller acknowledge and agrees that disclosures and information regarding the condition and other aspects of the Property, including those given by way of a Real Estate Transfer Disclosure Statement, may properly be provided after acceptance of the offer and that Seller, by way of additional, supplemental disclosures, may in good faith, undertake to correct, modify, or supplement any such disclosures, information, or representations. BUYER AGREES THAT IF BUYER DISAPPROVES OR IS DISSATISFIED WITH ANY CONDITIONS SO DISCLOSED BY SELLER OR BROKERS, BUYER'S SOLE REMEDY AS TO SUCH CONDITIONS, UNLESS OTHERWISE PROVIDED IN THIS AGREEMENT, SHALL BE TO SEEK, PRIOR TO CLOSE OF ESCROW AND WITHIN THE TIME FRAME PROVIDED BY CIVIL CODE §1102.2 (I.E., THREE DAYS AFTER DELIVERY IN PERSON OR FIVE DAYS AFTER DELIVERY BY DEPOSIT IN THE MAIL), THE TERMINATION OF THIS AGREEMENT AND THE RETURN OF BUYER'S DEPOSIT. BUYER ACKNOWLEDGES THAT SELLER'S AGREEMENT TO SELL THE PROPERTY IS MADE IN RELIANCE UPON BUYER'S ELECTION AND REPRESENTATION THAT BUYER WILL PURSUE NO OTHER CLAIM, ACTION, OR REMEDY (E.G., A LAWSUIT FOR NEGLIGENT MISREPRESENTATION OR NEGLIGENT, FAILURE TO DISCLOSE) AGAINST SELLER OR BROKERS ARISING OUT OF SUCH GOOD FAITH DISCLOSURES, INFORMATION, OR REPRESENTATIONS. FINAL VERIFICATION Or CONDITION: Buyer shall have the right to make a final inspection of the Property approximately 5 days prior to close of escrow, NOT AS A CONTINGENCY OF THE SALE, but solely to confirm that: (a) Repairs have been completed as agreed in writing by Buyer and Seller, (b) Seller has complied with Seller's other obligations, and (c) the Property is•otlierwise in substantially the same condition as on the date of acceptance of the offer, unless otherwise agreed in writing. LIQUIDATED DAMAGES: Buyer and Seller have initialed or will initial Paragraph(s) entitled "Liquidated Damages" clause contained in the Real Estate Purchase Contract dated April 22, 1996 for the subject property and agrees to be bound by same Continued on Page 6 �"�p}} QAlrr7 STRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF 1NE aNia(s below represent my agreement and acknowledgment of the foregoing. Buyer Initials: _ _ Page 5 Mariners Escrow Corporation Date: April 26, 1996 Escrow No.: 12574-DM Continued from Page 5 ARBITRATION OF DISPUTES CLAUSE: Buyer and Seller have initialed or will initial Paragraph(s) entitled and "Arbitration of Disputes" clause contained in the Real Estate Purchase Contract dated April 22, 1996 for the subject property and agrees to be bound by same. RETROFIT: Seller shall pay the cost of compliance with any minimum mandatory government retrofit standards and inspections required as a condition of closing escrow under local, state, or federal law, including, but not limited to, repairs required for mandatory compliance with building and safety requirements, and energy and utility efficiency requirements, , and except as otherwise agreed in writing. DUAL AGENCY: Buyer and Seller are fully aware that both parties are represented in this transaction by Grubb & Ellis Company and do hereby consent to such dual agency. BR0KEM DISCLOSURE: The parties hereto acknowledge that Buyer is a licensed Real' Estate Broker and that he/she is acting as a principal herein for his/her account, and not as air agent for his/her own account. SUPPLEMENTAL TAXES: Buyer is gware that the property will be reassessed upon change of ownership and that a supplemental tax bill will be received which may reflect an increase or decrease in property taxes based on property value. Tax bills received after close of escrow will be handled directly between Buyer and Seller. MARINERS ESCROW CORPORATION, IS LICENSED BY THE STATE OF CALIFORNIA DEPARTMENT OF CORPORATIONS. EACH PARTY SIGNING THESE INSTRUCTIONS HAS READ THE ADDITIONAL ESCROW CONDITIONS, GENERAL PROVISIONS AND INSTRUCTIONS ATTACHED HERETO AND MADE A PART HEREOF AND APPROVES, ACCEPTS AND AGREES TO BE BOUND THEREBY AS THROUGH SAID CONDITIONS, PROVISIONS AND INSTRUCTIONS APPEARED OVER THEIR SIGNATURES. The foregoing terms, provisions, conditions and instructions are hereby approved and accepted in their entirety and concurred in b• me. The undersigned hereby agrees to pay on demand, charges for drawing, recording and notarizing documents, chat es of title company, if any, charges of lender institution, if any, and the Buyer's and/or Borrower's customary escrow fees necessary to complete this escrow. I HAVE RECEIVED A COPY OF THESE INSTRUCTIONS. Buy •'s Signatures: John Davenport Caroline Davenport SELLER'S ESCROW INSTRUCTIONS: All of the terms, conditions, demands and instructions contained herein, are hereby approved and accepted in their entirety by the undersigned who will hand you all instruments and/or funds necessary to enable you to comply therewith, including deed(s) to the herein described property, all of which you are authorized to use and/or deliver, pursuant to your obtaining in this escrow for the account of the undersigned party(ies) within the time limit as provided for, the monies, being the total consideration above plus or minus above prorations and adjustments, and instruments called for under these instructions. When property being conveyed is held in joint tenancy any cash derived therefrom in this ' escrow shall be joint tenancy funds. From said monies, together with any necessary funds I hand you, you shall deduct and pay your Seller's escrow, drawing and recording fees, also for evidence of title called for above, documentary stamps as required on Deed to property I am conveying; and you are authorized to pay off any bonds, assessments and/or taxes, also any encumbrances of record, plus accrued interest, charges and prepayment penalty if any, per written demand of beneficiary, to show title as called for above and/or necessary to comply with same. Instruct the title company to begin search of title at once. I HAVE RECEIVED A COPY OF THESE ESCROW INSTRUCTIONS. Seller's Signature: C. Kent Freundt Barbara Casey Freundt END OF INSTRUCTIONS - - BE CERTIfI C YOE NEORRIg �DL CORf� M R10S CROY'J Page 6 a Fidelity National Title -'. --JNfWf kNCE-COMPANY July 31, 1991 The City of Newport Beach City Hall 3300 Newport Blvd. Newport Beach, CA 92658-8915 Attn: Marion Brockman RE: Escrow 611758 62 Beacon Bay, Newport Beach, CA Dear Marion: Enclosed please find copies of documents direct from County Recorders Office. Nr iJCl 1. ��yy. i��,f,�AGi i. i, ♦ i Originals will follow Also, enclosed please find our check in the amount of $2,245.34, representing: $ 89.12 - from Seller (Back) as portion of July payment @ $668.40 per month from July 1, 1991 to July 5, 1991. $2,156.22 - from Buyer (Freundt) as portion of July payment @ $2,395.83 from July 5 to August 1, 1991. Should you need anything further, please give me a call. Sincerely, Qd Susan Kerr Escrow Officer Enclosure Via Messenger 2100 SOUTH EAST MAIN STREET, SUITE 400 • IRVINE, CALIFORNIA 92714 • TELEPHONE (714) 852-9770 (800) 421-8111 FIDELITY NATIONAL TITLE 7240 INSURANCE COMPAf NE �+CIALCENTEROMCE ESCROW TRUST ACCOUNT WELLS�FARGO BANK 2140 S.E. MAIN ST., STE. 400 714-852-0770 WU NEWPORTCEWER ORIVC NIWPORT BMW. CA GM IRVINE, CA 92714 611758 -1 Jul"jr 31 91 16-24/643 ESCROW NO. 19_ 1220 PAY *TWO THOUSAND TWO HUNDRED FORTY FIVE AND 34/100* DOLLARS $ 2.245.34 r � TO THE City of Newport Beach ORDER ESCROW TR T ACCOUNT 61.02 OF 1110072409■®C1220002471:4643 092113511/ ------•----------------------------------------------------------- ------------ FIDELITY NATIONAL TITLE DETACHAND RETAIN THIS STATEMENT THE ATTACHCO CHECK 1E IN PAYMENT OF ITEMS DESCRIBED DIS-OW. INSURANCE COMPANY IF NOT CORRECT M.EASC NOTIFY US PROMPTLY. •NO RCCCIFT DESIRED DELUXE FORM WVO-4 SPL N-7440 DATE ORDER NUMBER DESCRIPTION 7-30-91 611758 62 Beacon Bay, Newport Beach, CA $2,245.34 Seller: Back Trust ( Viking) Buyer: Freundt $ 89.12—due from Seller $2,156.22—due from Buyer N-7440 -.r AMOUNT I r' 6 Fidelity National Title INSURANCE COMPANY July 16, 1991 COUNTERPART LETTER Viking Personnel Corp. 250 Newport Center Dr., #304 Newport Beach, CA 92660 Attn: Jim Anderson Gretchen Anderson, Trustee 406 Heliotrope Corona del Mar, CA 92625 Mr. and Mrs. C. Kent Freundt 62 Beacon Bay Newport Beach, CA 92660 RE; Escrow 61,1758 Back to Freundt When the above referenced Escrow closed, we deducted $668.40 from Sellers proceeds to pay the July 1, 1991 groundlease payment. We then prorated said amount, charging Buyer for unused portion. The following has been brought to our attention: 1. Seller never paid the June groundlease payment, so the City of Newport Beach is holding the $668.40 sent for'July payment and is applying it for payment for June. Seller then owes groundlease payment @ $668.40 per month from July 1 to July 5, 1991 in the amount of $89.12. Because of this, Seller was overpaid in the amount of $668.40. Please remit same to the undersigned as soon as possible. 2. Buyer should be $2,395.83 from July 5 $2,156.22, Because of this, amount of $1,576.94. soon as possible. paying the new groundlease amount of to August 1, 1991 in the amount of the refund given Buyer was overpaid in the Please remit same to the undersigned as 2100 SOUTH EAST MAIN STREET, SUITE 400 • IRVINE, CALIFORNIA 92714 • TELEPHONE (714) 852-9770 (800) 421-8111 PAGE 2 Upon receipt of the above funds, I will forward funds to the City of Newport Beach to complete the lease transfer. Your prompt attention is requested. Please give -me a call if you have any questions. Sincerely, SusSusa�i�� Dianne Sheridan Sr. Escrow Officer cc: Barger & Wolen/John Meindl The Busch Firm/Kathy Pear -Ed Schroeder City of Newport Beach/Marion Brockman J E 51� Fidelity National Title INSURANCE COMPANY July 5, 1991 City manager's Office City of Newport Beach 3300 Newport Blvd. Newport Beach, CA 92663 Attn: KATHY RE: Escrow 611758 62 Beacon Bay, Newport Beach Dear Kathy: Per our phone conversation this AM, enclosed please find: 1. Consent to Assignment of Agreement to Lease 2. Termination of leasehold BOTH need the signature of Mr. Wynn Notarized. As I explained this MUST record today. Please see what you can do and give me a call when ready and I will send a messenger to pick up the documents. (Hopefully you can have them ready by 11- 12). Thanking you in advance for your assistance... Susan Kerr Escrow Officer Via Special Messenger 2100 SOUTHEAST MAIN STREET, SUITE 400 • IR VINE, CALIFORNIA 92714 • TELEPHONE (714) 852-9770 (800) 421-8111 Fidelity National Title INSURANCE COMPANY July 5, 1991 City of Newport Beach 3300 Newport blvd. P. 0. Box 1768 Newport Beach, CA 92659-1768 FINANCE DEPT, RE: Escrow No. 611578 62 Beacon Bay, Newport Beach Enclosed please find our check for lease 0062-0 Should you have any questions, please feel free to contact our office. If has been a pleasure to have handled your escrow. If we can be of service to you at any time in the future, please contact us. Sincerely, Susan Kerr for Dianne Sheridan Sr. Escrow Officer Commercial/industrial Enclosure Via Mail if /. 7%6 3 �?S= d'-'-3 7-S - 7-3/ 2100 SOUTH EAST MAIN STREET, SUITE 400 • IRVINE, CALIFORNIA 92714 • TELEPHONE (714) 852-9770 (800) 421-8111 CITY OF NEWPORT BEACH Office of City Manager (714) 644-3002 July 11, 1991 Ms. Susan Kerr Fidelity National Title Insurance Co. 2100 South East Main Street Suite 400 Irvine, CA 92714 Re: Escrow No. 611578 #62 Beacon Bay Newport Beach Enclosed please find your check in the amount of $668.40. Per our telephone conversation of July loth, please issue a check to the City for lease payments from the Backs for the period July 1st to July 5th. The new lease payments starting July 5, 1991 will be $2,395.83. Please prorate. Thank you, Marion Brockman Secretary to Kenneth J. Delino Deputy City Manager Enclosure City Hall • 3300 Newport Boulevard 0 P.O. Box 1768 • Newport Beach, California 92658-8915 ppi FIDELITY NATIONAL TI 7178 gl INSURANCE COMPAI Nfl POR AL CEN ER OfROE ESCROW TRUST ACCOUNT WELL�AR,GO BANK 2100 S.E. MAIN ST.. STE. 400 714.852-9770 em NE RTOMMR ORIMNE RTBF W,ce IRVINE, CA 82714 611758 July 05 �9 91 1e-241sa1 ESCROW NO. 1720 SIX HUNDRED SIXTY-EIGHT AND 40/100 DOLLARS PAY DOLLARS $ fifiR.4N r City of Newport Beach � TO THE ORDERESC-'SC�6�nW TRUST A COUNT 01.02 OF \ GroundLease � n LJ aC.t.l. OlinnLa_/ Q . U_u m) R'007i7811■m1:122000247�:4643 092935i1• r, FIDELITY NATIONAL TITLE OETACH AND RETAIN THIS STATEMENT TH6 ATTAOHEO CH¢CN 10 IN PAYMENT OF ITCMB .60 RJMO OELOW. CT INSURANCE COMPANY IP NOT CORRCPIEAEC NOTFY UE PROMPTLY. NO RCCEIPT DESIRCO 7 DELUXE FORM WVO.4 SPL N-7440 DATE ORDER NUMBER DESCRIPTION 07/05/91 611758 PROPERTY ADDRESS: 62 Beacon Bay Newport Beach BUYER/BORROWER: Freundt: C. Kent & Barbara SELLER/LENDER: Viking Personnel Corp. N-7440 AMOUNT $ 668.401 CITY OF NEWPORT BEACH Office of City Manager (714) 644-3002 July 11, 1991 Ms. Susan Kerr Fidelity National Title Insurance Co. 2100 South East Main Street Suite 400 Irvine, CA 92714 Re: Escrow No. 611578 )//ag #62 Beacon Bay d Newport Beach Enelase� ase-g"—yeur—check- in-tho a Per our telephone conversation of July loth, please issue a check to the City for lease payments from the Backs for the period July 1st to July 5th. The new lease payments starting July 5, 1991 will be $2,395.83. Please prorate. Thank you, Marion Brockman Secretary to Kenneth J. Delino Deputy City Manager City Hall • 3300 Newport Boulevard • P.O. Box 1768 • Newport Beach, California 92658-8915 POOR.:,. QUALITY ORfGINAI (S) RICHARDS 0, OAPOCR ALAN R. WOLEN VICTOR C. LCVIT HCNT HCLLCR THOMAS B. ACKLAND XARL L. DAVIS. JR. WILLIAM A. NUPLANDER ROGER, W. HOOCOOOM STEPHEN C. KLEIN S. STUART SOLDATC ROYAL F. OAKES DON R. AOHINSON DENNIS W. HARWOOD JOHN M. MCINDL JOHN J RICHMOND STEVEN H. WCINSTCIH SANDRAI WEISNART GAIL C. COHEN JOHN SHCA PIERCE ROBERT 0. LEVY MARTIN E. ROSEN EDWIN A OSTER LARRT M. GOLUB J. RUSSCLL STCOMAH DNAROH O DONZIS RICHARD C MINNC HUGH J. CADGER JOHN C HOLMES DAVID C PARR ROOCRTJ MCHCNNON JOHN S. TAYLOR RICHARD Q. GE LA MORA LINDA C JOHNSON JOHN C. MCPHCPSON RANDALL A. DOCTOR MICHAEL L. ROSENFIELD SCOTT J THERRIEN SCAN 0, WHITC MONICA A FISHER NANIS R TOOFANIAN LINDA R. CARUSO OICTMAR A. ORCLLMANN LAWRENCE F HRUTCNIH AUOPCY M LYNCSS SUSAN A. BYRON J RONALD IONATUN JOHN L INGERSOLL MARK A. MOORC VIA MESSENGER LAW OFFICES BARGER & WOLEN 19800 MACARTHUR BOULEVARD SUITE 600 IRVINE, CALIFORNIA 92715 TELEPHONE: (7I4) 757-2600 FACSIMILE: (7I4) 752-6313 June 27, 1991 Ms. Marian Brockman City Managers Office City of Newport Beach' 3300 Newport Boulevarl Newport Beach, Califo: Re: 62 Bea( Transf( Moniqu( to C. ] Dear Ms. Brockman: In connecti( LOSANGELESOFFICE SANFRANCISCOOFFICE 530 WEST SIXTH STREET NINTH FLOOR LOS ANGELES. CA 90014 TELEPHONE. (213) 680.2600 FACSIMILE 1213) 527-1294 OF COUNSEL ALLAN R. M047ZCN FRANCIS G WILLMARTH 101 CALIFORNIA STREET SURE Iwo SAN FRANCISCO, CA 94111 TELEPHONC(415) 4342800 ` FACSIMILE, HIS)4342530 o ICE P�cq* by us PLEASE REFER TO OUR FILE NUMBER. 46229-001 CAM a. 1^-^-- 1. Assignment of Leasehold Interest executed by Monique Gretchen Anderson as Co -Trustee of the J. William Back and Monique T. Back Trust Dated September 15, 1982 and by C. Kent Freundt and Barbara Casey Freundt; 2. Consent To Assignment; 3. Termination of Lease executed on behalf of the J. William Back and Monique T. Back Trust Dated September 15, 1982. The Consent to Assignment and Termination of Lease are enclosed for signature by the Newport Beach City Clerk, City At- torney, and Mayor. After execution, please forward the documents as follows directly to the escrow which is scheduled to close on July 1, 1991: Ms. Diane Sheridan, Senior Escrow Officer, Fidelity National Title Insurance Company, 2100 Southeast Main Street, Suite 400, Irvine, California 92714, Escrow No. 611758, Order No. 54099. LAW OFFICES BARGED & WOLEN RICHARDS 0. OAROCR SHARON D DONCIS 19600 MAcARTHUR BOULEVARD ALAN R. WOLCN RICHARD C MINHC VICTOR O. LEVIT HUGH J CADOCN SUITE 800 HCNT RELLCR JOHN C. HOLMCS THOMAS B. ACHLAND .AVID C. PAPN �}� {�� MVINE, CALIFORMA 92715 MARL L. DAVIS. JR RODCRT J. MCRENNON WILLIAM A. HURLANOCR JOHN G TAYLOR TELEPHONE: V14) 757-2800 ROBERT W. HOOCOOOM RICHARD O OC LA MORA FACSIMILE (714) 752-6313 CTCPHCN C I.C.H LINDA C JOHNSON S STUART COLOATC JOHN C MCPHCR50H ROYAL r. OANCC RANDALL A DOCTOR 00. R. AONINDON MICHAEL L. ROSENrICLD DENNIS W HARWOOD SCOTTJ THERRIEN JOHN M. MCH OL WHITE VR June 27, 1991 JOHN J R CNMONO B^MOR N WCISHART MONICA$CANA. NAMIP. TOOF W AN BAM RA I. WCIBNART ARL.0 LINDA R. CARUSO LINDAMPO R. CN C.... OICTMAR A. ANN S JOHN SN CA PIERC[ JOHN . KRUT LAWPEN CE r. HPVTC HIN RO.LCVY M LYNEB9 C. ROCCN C. SUSACY BVMON A OYRON COWTIN COWIN A. OSTCGOLU J ONAT UR IERSOLL LARUS JOHN L IMOORBOLL JOHN L I E L STC J pUCB CLL fTCOMAN MARK A. MOOPC VIA MESSENGER Ms. Marian Brockman City Manager's Office City of Newport Beach 3300 Newport Boulevard Newport Beach, California 92663 LOS ANGELES OFFICE SAN FRANCISCO OFFICE 530 WEST SIXTH STREET NINTH FLOOR LOS ANGELES, CA 90014 TELEPHONE: (213) 580-2800 FACSIMILE. (213182)9294 or COUNSCL ALLAN R MOLTZEN FRANCIS O. WILLMARTH 101 CALIFORNIA STREET SUITE 1000 BAN FRANCISCO. CA 84111 TELEPHONE (415)439-2800 FACSIMILE: 1415143P2533 PLEASE REFER TO OUR FILE NUMBER' 40229-001 Re: 62 Beacon Bay, Newport Beach, California Transfer from the J. William Back and Monique T. Back Trust Dated September 15, 1982 to C Kent Freundt and Barbara Casey Freundt Dear Ms. Brockman: In connection with the above matter, enclosed are: 1. Assignment of Leasehold Interest executed by Monique Gretchen Anderson as Co -Trustee of the J. William Back and Monique T. Back Trust Dated September 15, 1982 and by C. Kent Freundt and Barbara Casey Freundt; Consent To Assignment; 3. Termination of Lease executed on behalf of the J. William Back and Monique T. Back Trust Dated September 15, 1982. The Consent to Assignment and Termination of Lease are enclosed for signature by the Newport Beach City Clerk, City At- torney, and Mayor. After execution, please forward the documents as follows directly to the escrow which is scheduled to close on July 1, 1991: Ms. Diane Sheridan, Senior Escrow Officer, Fidelity National Title Insurance Company, 2100 Southeast Main Street, Suite 400, Irvine, California 92714, Escrow No. 611758, Order No. 54099. n U T JT/� 6 LAW OFFICES BARGER & WOLEN Ms. Marian Brockman June 27, 1991 Page 2 If you have any ques�ns, please call me. Yours singerely, M. MEIN the Firm JMM: ail Enclosi Pc: M: M: T: TEL No. • Juri L9 -VI &VIVA MWKICI'n nm•omo ieloe Q CALIFORNIA FEDERAL, Jun GENDER'S AGREEMENT WITH LESSOR 25,91 15:19 P.03 THIS AGREEMENT is made on the date subscribed by and between ww�uw ("Letuor'l the Lessor under that deft li lease matte and entered into MOVE PI$ER 3 ,18 89 , by and between Lessor and IRILLIAM SACK i MONIQt16 T. BACK—( SELLERS ("Lessee"), as Leases, which was recorded on PECEMBLR a, 19 sP, in Book — Paqa Instrument Number 89-687991 , Otfi ial Records, ORANGE _ County, State of - CAMORNIA ("Lease") and CALIFORNIA FEDERAL SAVINGS AND LOAN ASSOCIATION, ("Lender"); IN CONSIDERATION of Lender making a loan secured by the Leaseholo interest held by Lessee pursuant to the Lease ("leasehold") above described and of the mutual dovenallp of the parties heroic, the parties agrao as follows; 1. Lessor hereby consents to the assignment, transfer and hypothecation of the Leasehold; as security for a loan to be made by Lender to Lessee under the Lassa, and to the further assignment of the Lases by Lessee to Lender in lieu of foreclosure thereon by Lender under its loan to Lessee. If the Leasehold is acquired by Lender by torechsaure or by assignment in lieu thereof, Lessor agrees to waive any restrictions whatsoever on the sselgnability of the Lease for the remainder of the term thereof. Lender may, upon acquiring the Leasehold, without further consent of Lessor, sell and assign the Loud on such terms and to such persons and organizations as are acceptable to Lender and thereafter be relieved of all dbligabens under the Lease; provided that such assignee has delivered to Lessor Its written agreement to be bound by all ` of the provisions of the Lease and provided further that no default exists as of the data of such assignment under the terms of the Lease. 2. Lwor agrees to give Under written notice of any default by Lasses under the terms of the Lease, and further agrees that Lender shall have a period of 30 days to cure such default. No notlas by Lessor to 1.01460 shall be deemed to have been duly given or valid for any purpose whatsoever unities a copy of such n01104 11 at the same time delivered to Lender, If the default is such that it cannot be cured within the Wday period, Lessor shall give written notice to tender that it will not terminate or declare a forfeiture of the Lease If Lender will as snen as possible commence foreclosure proceedings, In which event the assignment of the Leasehold to Lender in Ileu of foreclosure, or the sale of the Leasehold at a trustee's sale or judicial sale, as the case. may be, under said foreclosure proceedings, shall be deemed to our$ such default. Lessor agrees that it will not terminate the Lease for a default that cannot be cured by Lender as long as payments of rent under the Lease are currant. 3. It the Lease is terminated for any reason or If the Lease is disefflrmed by Lessee as a debtor-in•poesession or by Lessee's trustee In a bankruptcy proceeding, Lessor &gross immediately to enter into a now Lease with Lender upon the same rental and other terms and conditions as in the Lease. The new Loess shall commence an the date of termination of the Lease and the term of the new Lease shall be equal to the unexpired term of the Lease and shall contain the same options of extensions or renewals. The new Lease shall be superior to all interests other than those to which the Lease was subject immediately prior to its termination, These provisions shall be self-executing and Lessor need do nothing other than execute the new Lease to assure good title to the Lessehold granted thereby to Lender. a. In the event that all, or a potllen, of the Laleed promises are condemned, and the portion of the condemnation award awarded to Lessee and assigned to Lender by its security Instrument shall not be sufficient to discharge in full Lender's loan, Lessor agrees to assign, and hereby does assign to Lender, such potion of the condemnation award awarded to Lessor as may be neosseary fully to discharge Lender's loan. 5. Notwithstanding anything In the Leaea to the contrary, It is agreed that all Insurance proceeds payable because of loos or destruction of all or some portion of the Leased premises shall be paid to Lender and applied against its, loan, provided, however, that it the insurance proceeds in the opinion of Leader are sufficient to completely repair or restore the damaged improvements, or If Lessor or Lessee will contribute whatever amount Lender deems nscaeeary over and above the Insurance proceeds to restore or repair such damage completely, such funds shad be deposited with Lender to be used In resWration and repair of the damaged premises, Such proceeds shell be held by Lender end shall be disbursed in four equal Installments, the first such installment to be disbursed when Lender has determined that 25% of the projected work has been completed and each of the remaining Installments to be disbursed when Lender determines that an additional 25% of the projected work has been completed. 6. Lessor agrees that as long as the loan of Lender to Lessoe is secured by the Leasehold; (a) Lender, as aftomeyandact for Lessee, may exercise all options under the Lease including, but not limited to, options for renewal and extension of the term of the lease and options for the porches@ of the famed premises; (b) if Lessee falls to exercise any such option, then Lessor shall give written notice to Lender that Lessee failed to exorcise such option and Lender shall have a 30day period alter receipt of such notice within which to exercise such option, y. Lessor agrees and acknowledges that Lessee is not in default under the terms of the Lease as of the date hereof and that all rental$ and other payments to be made thereunder by Losses are current and not delinquent. As long as Lender has a loan secured by the Leasehold, Lessor further agrees that no cancellation, surrender or modification of the Letts$ shall be effective as against Lender unless first consented to In writing by lender, G. Any notice to be given W Lander shall be served personally or mailed first -atria postage prepaid United States mail eddrossed ta' Lender furnish516 Walnut to Lessor n writing. An nog lice or elivCalifornia ate Lessor shalt be Attention: Loan ror manned first-class or at postageuch other prepaid United States mall addressod to Lessor at g ydelivery - - —_ or at such other address as Lessor may furnish to Lender In writing. iN wiTNESS WHEREOF, the parties hereto have executed lhls Agreement led ffe- CA61FORNIA F80Ef14L SAVIN08 AND LOAN ASSOCIATION AuOltft a 'IMothy IL Sunh. J,D„ CPA JUcX S. Weiner, J.D., CPA ••rAward P. 9ehroedeT. J,D., CPA •••Dominle Kracht, J.D., LLM„ CPA '—QCrnitl L. r,araen, J.D., U.M., CPA TO; f_-i;7!�- TEL 0 No. THE BUSCH FIRM A PROtTSSIONAL LEGAL CORPORATIOR ATTORNM AND CODh9ELOK5 N LAW 1900D MaQtihur 5W. suite 123 [vine, Caldorrr[r 92713 (714) 414.7MB FAX (714) 474.7732 4. 0 • A.jK6• :d' '1:r' � N0. OF PAGES = (INCLUDING IF ALL PAGES ARE NOT RECEIVED SHOWN ABOVE. Jun 25,91 IT IS INTENDED ONLY FOR THE U920010F TE ENTITY NAMED ABOVE. IF THE READER OF THIS MEG INTENDED RECIPIENT, YOU ARE HEREBY° DISSEMINATIONr DISTRIBUTION OR COPY OF STRICTLY PROHIBITED. IF YOU HAVE RECEI ERRORr PLEASE NOTIFY US nfl=xAVELY BY HO' RETURN THE ORIGINAL MESSAGE TO US AT THE OVz U.S. POSTAL SERVICE. WE WILL REIMBURSE YOU FOR v-e Wy,w 15:18 P.01 ACmdafmm Gregory A. Bunch, CPA Karen M. Suaeh, CPA CALLNUMBER � • • : M IN AND VIA THE THANK ,4...h? . Ala* d«noW ld 171 Ken Delino June 24, 1991 Page 2 Also enclosed Leasehold Interest in releasing the Seller's with the Buyers. is a red -lined copy of the Assignment of which two paragraphs have been added liability once the new Lease is executed Please feel free to call this office if you should have any questions. very truly yours, ZA TIMOTHY R. B SCH on behalf of THE BUSCH FIRM, P.C. TRB/cp Enclosures cc: C. Kent Freundt Dianne Sheridan John Meindl TEL No. Jun 25,91 15:19 P.02 sum timothy R. eWCh. J.D., CPA Rich & Wetner. J.D., CPA Edward P. Schroeder. JA, CPA • • Dominic Hmcht. J.D., um., CPA Gerald L. IaMcn, J.D., LLM., CPA THE BUSCH FIRM A PROFrWOM1 LEG& COMOMT(ON AWOMM AND COWWWRS AT LO 1WW MarAMIUr Blvd., Sulfa 123 W(ne.Callkmmla 82713 (714) 474.73N MX (914) 474.7732 VIA FACSIMILE (714-644-3339) June 25, 1991 Mr. Ken Delino Deputy City Manager 3300 Newport Blvd. Newport Beach, CA 92663 RE1 C. Kent Freundt and Barbara Casey Freundt 62 Beacon Bay, Newport Beach, California Our File No, 2011-6.1 Dear Mr. Delinos .aRGaftIAM amWrY & Hunch, CPA Koren M. BU7rh, CPA In connection with the above property, enclosed please find a Lender's Agreement with Lessor which California Federal the Buyer's lender) requires to be executed by the Lessor (the City). Please revievi same and call this office with any comments or changes you may have. The closing date for this property is July 1, 1991. Very truly yours, TIMOTHY R. BUSCH on behalf of THE BUSCH FIRM, P.C. TRB/cp Enclosure ATMRrIEYS 'Timothy % Busch, J.D., CPA Rick S. Weiner. J.D., CPA —rdward P. Schroeder, J.D., CPA ***Dominic Kracht, J.D., LLM., CPA '•'Oeraid L. Larsen, J.D., LLM., CPA THE BUSCH FIRM A PROFESSIONAL LEGAL CORPORATION ATTORNEYS AND COUNSELORS AT IAW 19000 Mack iur Blvd„ Suite 125 Irvine, California 92715 (724) 474.7368 FAX (714) 474-7732 June 24, 1991 Mr. Ken Delino Deputy City Manager 3300 Newport Blvd. Newport Beach, CA 92663 RE: C. Kent Freundt and Barbara Casey Freundt 62 Beacon Bay, Newport Beach, California Our File No. 2011-6.1 Dear Mr. Delino: ACCOUMMAMS Gregory A. Busch, CPA Karen M. Busch, CPA In connection with the above -referenced matter, enclosed for signature by the City Clerk, City Attorney and Mayor are the following original documents which have been executed by the Buyer: 1. Memorandum of Lease Lease After execution, please hold these documents until closing which is scheduled to be on July 1, 1991. Ms. Dianne Sheridan, Senior Escrow Officer of Fidelity National Title Insurance Company is handling this closing. Dianne's address, phone number, fax number and file number are as follows: Ms. Dianne Sheridan Senior Escrow Officer Fidelity National Title Insurance Company 2100 Southeast Main Street, Suite 400 Irvine, California 92714 PH: 714-852-9770 FAX: 714-261-9158 Escrow No. 611758 Order No. 54099 Also licensed in 'Michigan • Indiana '••Ucensed In Florlda only Fidelity National Title INSURANCE COMPANY June 4, 1991 CITY OF NEWPORT BEACH 3300 Newport Blvd. Newport Beach, Ca. 92663 Attention: Marian Brockman /5 �7/ '�4 4w, �Ve) RE: Escrow 611758 Property address: 62 Beacon Bay, Newport Beach GroundLease: J.William Back & Monique T. Back Trust Dear Marian: Enclosed please find a Rent Statement to be completed in connection with proration of the groundlease rent between Back Trust and the new Buyers at close of escrow. Please have the appropriate party handling the payments complete this statement for our escrow file. Call me should you have any questions. When the statement is completed, call the undersigned for messenger pickup. Please do not send by mail. Thankyou in advance. Sincerely, / Dianne Sheridan Sr. Escrow Officer encl RECENED JUN 041991� DEPUTY CITY MANAGER (Iro CITY OF NEWPORT BEACH L 2100 SOUTH EAST MAIN STREET, SUITE 400 • IRVINE, CALIFORNIA 92714 • TELEPHONE (714) 852-9770 (800) 421-8111 e r� {,1 a .�. Fidelity National Title INSURANCE COMPANY SUPPLEMENTAL ESCROW INSTRUCTIONS STATEMENT OF RENTS AND DEPOSITS To: Dianne Sheridan is Date June 4, 1991 Escrow No. 611758 The following is a Rental Statement covering the subject property described in this escrow and is to be used as a basisfor rent adjustments at close of escrow. Included herein is a list of all security deposits and payment of advanced rents collected by Seller. Charge Seller and credit Buyer in an amount equal to any deposits for last month's rent and for security deposits in addition to rent proration as called for in our escrow instructions. w Address of Property Name of Tenant Rent per month Date paid to Advanced Security Groundlease . Rents Deposits 62 Beacon Bay, Newport Beach, CA. BACK Trust $668.40 5-31-91 -0- -0- You are instructed to make adjustments as though Seller has collected all rents which fall due during the pendency of this escrow according to the foregoing statement. A different adjustment will be made only in the event the Seller notifies Escrow Holder in writing of such change, which instructions shall be approved by Buyer. Citv of Newport Be h J. William Back and Monique T. Back Trust t24a�, dated September 15, 1982. By: MARION BROCKMAN By: Monique Gretchen_ Anderson, Co -Trustee CITAOF NEWPORT BEACH MEMORANDUM: FrOM DEPUTY CITY MANAGER TO. ......... FINANCE ,JULY 10...................... ........................................ ..-........... RE: #62 BEACON BAY As of July 5, 1991 the new monthly rental for #62 Beacon Bay will be $2,395.83 and the new owners are: C. Kent and Barbara Freundt 62 Beacon Bay Newport Beach, CA 92660 Reply wanted ❑ Reply riot nwem=7 ❑ NI -M- Y KENN1 J VD FAX COVER SHEET TPx LOCATIONS HVSINESS PHONE: �.y �� FAX NCMSERx FROM: X]CNNETH S . D£LSNO 2�0 CATIONS N t ri ri H 11 L'VSIN£SS PHONES (714) 644-3002 I+'AX NVMSERx (714) 644^3339 TRANSMISSION REPORT THIS DOCUMENT (REDUCED SAMPLE ABOVE) WAS SENT ** COUNT # 4 *** SEND *** NO REMOTE STATION I.D. START TIME DURATION 5EAOES COMMENT f71 9-4747732 6-26-91 907AM I 3'34" I 4 TOTAL 0:03'34" 4 XEROX TELECOPIER 7020 ATMRMYS 'Timothy IL Busch, J.D., CPA THE BUSCH FIRM Rick S. Weiner, J.D., CPA "Edward P. Schroeder, J.D., CPA A PROFESSIONAL LEGAL CORPORATION —Dominic Kracht, J.D.. I.I.M., CPA ATTORNEYS AND COUNSELORS AT IAW "'Gerald L. Larsen, J.D., LId4., CPA 19M MacArthur Blvd„ Suite 125 Irvine, California 92715 (714)474.7368 PAX (714) 474-7732 VIA FEDERAL EXPRESS June 26, 1991 Mr. Ken Delino Deputy City Manager 3300 Newport Blvd. Newport Beach, CA 92663 RE: C. Kent Freundt and Barbara Casey Freundt 62 Beacon Bay, Newport Beach, California Our File No. 2011-6.1 Dear Mr. Delino: ACCOU"AMTS Gregory A. Busch, CPA Karen M. Busch, CPA In connection with the above -referenced matter, enclosed please find a check in the amount of $50.00 which represents the document drafting fee requested by the City on this date for preparing the Consent to Assignment of Agreement to Lease. TRB/cp Encjosure y trul ou , TIMOTHY BUSCH on behalf of THE BUSCH FIRM, P.C. DECEIVED JUN 27 1991► '� DEPUTY CITY gpRAGER CITY OF ItURV0I BfACN / Also licensed In 'Mlchlgan "Indiana —1.1censed in Florida only 4. ATTORNEYS 'Timothy R. Busch, J.D., CPA Rick S. Weiner, J.D., CPA **Edward P. Schroeder, J.D., CPA •••Dominic Kmcht, J.D., LLM., CPA "*Gerald L. Larsen, J.D., LLM., CPA VIA FACSIMILE (714)64 -3339 AND REGULAR MAIL 0 THE BUSCH FIRM A PROFESSIONAL LEGAL CORPORATION ATTORNEYS AND COUNSELORS AT LAW 19000 MacArthur Blvd., Suite 125 Irvine, California 92715 (714) 474-7368 FAX (714) 474-7732 June 3, 1991 Kenneth J. Delino City Hall City of Newport Beach 3300 Newport Boulevard P.O. Box 1768 Newport Beach, CA 92659-1768 RE: #62 Beacon Bay Our File No. 2011-6.1/F1.1 Dear Mr. Brockman: ACCOUIYPAMS Gregory A. Busch, CPA Karen M. Busch, CPA DUN �T n>nrin�at CITT 01 I;isv 19U&H 2,Q I am in receipt of your package dated May 23, 1991, referencing the Termination of Leasehold Interest. I have forwarded a copy of the Termination of Leasehold Interest to John M. Meindl, (714)757-2800. The Seller, who Mr. Meindl represents, is attempting to exchange the Leasehold Interest for a leasehold on another property, pursuant to Section 1031 of the Internal Revenue Code. I am not sure whether the Termination will resolve the 1031 exchange requirements of the Seller, so I will leave that for him to discuss with you. Under the Memorandum of Lease, the term "Trustee" should be deleted for the new Lessee; the property is being held as community property. With respect to the format, the term of the Lease is identified as beginning January 1, 1988. In actuality, this Lease Agreement will commence on approximately June 18, 1991. This is important for purposes of applying the base rental, which is a much lower sum for the time prior to June 18, 1991. Also licensed in *Michigan —Indiana •••Licensed in Florida only Kenneth Delino June 3, 1991 Page Two Please address the prorating. I suggest the rent be adjusted, effective July 1, 1991, and the old rent, which will be paid on June 1,•1991, continue. Under Paragraph 5F, I believe the as the first word in the first sentence,-ls34 �TIMOTHY R ton behalf THE BUSCH TRB:mem cc: Kent Freudt John Meindl to "Lessee" FIRM, P.C. ATTORNEYS •Timothy IL Busch, J.D., CPA Rick S. Weiner, J.D., CPA **Edward P. Schroeder, J.D., CPA •—Dominic Kracht, J.D., LLM., CPA '••Gerald L. Larsen, J.D., LLM., CPA THE BUSCH FIRM A PROFESSIONAL LEGAL CORPORATIOP ATTORNEYS AND COUNSELORS AT LAW 19000 MacArthur Blvd., Suite 125 Irvine, California 92715 (714) 474-7368 FAX (714) 474-7732 May 22, 1991 Mr. Ken Delino Deputy City Manager 3300 Newport Blvd., Newport Beach, CA 92663 RE: C. Kent Freundt and Barbara Casey Freundt 62 Beacon Bay, Newport Beach, California Our File No. 2011-6.1 Dear Mr. Delino: ACCOUIRANTS Gregory A. Busch, CPA Karen M. Busch, CPA Pursuant to the request of Marian Brockman on this date, enclosed please find a copy of the Escrow Instructions for your review and a check in the amount of $50.00, which represents the transfer fee in connection with the above -referenced property. As discussed, upon your receipt of this information, you will prepare the transfer paperwork necessary in connection with the Assignment of Leasehold Interest previously forwarded to your office. Please call this office if you should require any further information. I appreciate your kind cooperation and prompt attention to this matter. TRB/cp Enclosures cc: C. Kent Freundt Tckl:CP:6:1:91 yours, TXWTWf R. PUSCH ohbehalf o THE BUSCH FIRM, P.C. Ef, Also licensed in 'Michigan "Indiana •••Licensed in Florida only r • FIDELITY NATIONAL TITLE INSURANCE COMPANY 2100 S. E. Main Street, Suite 400 Irvine, California 92714 714-852-0846 FAX 714-261-9158 Dianne Sheridan Sr. Escrow Officer Escrow No. 611758 March 21, 1991 ESCROW INSTRUCTIONS These instructions supersede all instructions prior to this date. Buyer has handed Escrow a deposit of ...............$ 34,500.00 Before close of escrow on June 18, 1991, Buyer..... will hand you the balance of Buyer's down payment.. 253,000.00 in the amount of......•� ................................... and will execute a new first trust deed in the 862,500.00 approximate amount of..........................•••:$1,150,000.00 to make a total purchase price of ................. which you will deliver to Sellers when you record an Assignment of Leasehold Interest and when you can issue your usual standard form CLTA itle rance with a the amount Lofs$1o,150,000-00ld Policy oonTproperty udescribed as follows: in A Leasehold Interest in and to property known as 62 Beacon legally described as: the subject building situated on Bay, Newport Beach, Ca. 92660, Lot 1 of the eastside addition to Beacon Bay recorded on Official Maps Book 2, Page 30 in the Office of the County Recorder, County of Orange, State of California, sometimes referred to as Beacon Bay Lot 62. showing title vested : FREUNDT, husband and wife (exact vesting will followDT and ) BABA CASEY FREE OF ENCUMBRANCES EXCEPT: A) Current Installments of general and special county and city taxes, including any special district levies payments of which are including any special district levies payments of which are included therein and collected therewith, for the currentear scif year, not delinquent, including able. The lien ofhsupplement 1 taxes, any, a lien but not yet pay if any, assessed pursuant to the provisions of Senate Bill 813, Statutes of 1983 of the State of California. yumm MAR 7 6 1991 FIDELITY NATIONAL ;®��~.�,� TITLE B) Covenants, restrictions, reservations, covenants, rights, rights of way, easements and exception of minerals, oil, gas, water, carbons and hydrocarbons substances in, on or under said land, now of record, and in deeds to file, affecting the use and occupancy of said property. C) This Escrow is contingent upon Buyer securing a new First Trust Deed to file in the approximate amount of $862,500.00, at best available rate and terms. Buyers execution of loan documents shall be deemed to be Buyers full approval of the terms and conditions of said new loan and Escrow Holders authorization to comply with lenders requirements. Buyer to give Seller written verification of loan approval by April 2, 1991. Buyer's shall retain financing contingency until April 2, 1991. Seller to provide buyer a copy of the Ground Lease Agreement being assigned to the buyer. In the event Buyer informs Seller and Escrow Holder financing has not been approved, then, without further instructions from the Buyer and Seller, Escrow Holder will cancel this escrow. All funds on deposit at that time are to be disbursed to the buyer herein less any and all charges and expenses incurred herein. PROBATIONS: Escrow Holder to prorate the following: --Taxes as of the close of escrow based on latest tax figures --Rents. Prorate Rents as of the close of escrow. Escrow Holdr is yer Junee It 1991tothe ted tclose l of uescr wdbasedlSeller on amonthly rental of $6,250.00 --Any security deposit held by landlord shall be reimbursed to Seller herein at the close of escrow --Land lease payment 1. -Seller shall furnish Buyer at Sellers expense, a Preliminary Report covering the subject property. Buyer to approve the preliminary report within 10 days of receipt of same. Buyer's failure to notify Escrow holder in writing with 10 days of receipt shall be deemed to be Buyer's full approval of said report. 2. The Buyer's $34,500.00 deposit (when) received by Escrow Holder and Escrow Holder has verified clearance of said 'deposit, shall be deposited into an interest bearing account for credit of Buyer herein. Bt.yer shall provide Escrow Holder with a W-9 form. 2 3, Seller reserves the right to effect a 1031 exchange prior to the close of escrow and Buyer agrees to cooperate with Seller in such exchange, provided Buyer is not at any additional expense as a result thereof. 4. All parties are aware that M. Gretchen Anderson represents Seller only in this transaction is a relative of said Sellers. 5. Normal closing costs include the following, but not limited to: the Seller herein shall pay the cost of the CLTA Leasehold Policy of Title Insurance premium, any transfer fee, costs or other expenses associated with the Assignment of the Leasehold Interest, one-half of the escrow fee, reconveyance fees, normal recording and document preparation fee, as is customary in Southern California, documentary transfer tax; the Buyer herein shall pay the cost of the ALTA Lender's Policy of Title Insurance, if required, one-half of the escrow applicable; l charges in connection with Buyers new loan, if recording and document preparation fee, as is customary in Southern California. 6. Under the foreign Investment in Real Property Tax Act, (FIRPTA) orcl445, every Buyer of U.S. Real Property must, unless exemption applies, deduct and withhold from Seller's proceeds 10% of the gross sales price. Seller and Buyer agree to execute and deliver as directed any Instrument Affidavit and Statement or to perform any act reasonably necessary to carry out the provisions of FIRPTA and Regulations promulgated thereunder. 7. Prior to close of escrow, Buyer shall cause to be handed Escrow Holder a fully completed "Preliminary Change of Ownership Report" pursuant to the requirements and in accordance with Section 480.3 of the Revenue and Taxation Code. If Buyer so chooses, Buyer may elect not to complete and execute the form prior to close of escrow. However, Buyer is made aware that a $20.00 penalty will be assessed by the County Recorder's Office and • Escrow holder will charge the account of the Buyer accordingly. 8. Seller shall complete a 1099 form and a W-9 form as required by IRS prior to close of escrow. 9. GOOD FUNDS LAW: Section 12413.1 California Insurance Code, commonly known as Assembly Bill 512, became effective January 1, 1990. This legislation deals with the disbursement of funds deposited with any title entity acting in an escrow or subescrow capacity. The law requires that all funds be deposited and collected by the title entity escrow account prior to disbursement m n yfunds. Some methods of eriod which must expire beforenanyafundsj ect fundstoaholdingpmay l 10 r� be disbursed. In order to avoid any such delays„ all fundings should be done through wire transfer, or cashier's checks drawn on California Financial Institutions only. 10. Buyer to complete a W-9 Form and is further directed to deposit Buyers funds into an interest bearing account. 11. NOTICE TO BUYER ON DISPOSITION OF CALIFORNIA REAL PROPERTY, effective January 1, 1991, under Senate Bill 2319 is attached hereto and made a part of these instructions. 12. Report of Sales Activity for the Year 1991 is attached hereto and made a part hereof to be completed by Seller only. 13. LIQUIDATED DAMAGES: IF BUYER FAILS TO COMPLETE SAID PURCHASE AS HEREIN PROVIDED BY REASON OF ANY DEFAULT OF BUYER, SELLER SHALL BE RELEASED FROM OBLIGATION TO SELL THE PROPERTY TO BUYER AND MAY PROCEED AGAINST BUYER UPON ANY CLAIM OR REMEDY WHICH HE/SHE MAY HAVE IN LAW OR EQUITY; PROVIDED, HOWEVER, THAT BY INITIALLING THIS PARAGRAPH BUYER AND SELLER AGREE THAT SELLER SHALL RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES. IF THE DESCRIBED PROPERTY IS A DWELLING WITH NO MORE THAN FOUR UNITS, ONE OF WHICH THE BUYER INTENDS TO OCCUPY AS HIS/HER RESIDENCE, SELLER SHALL RETAIN AS LIQUIDATED DAMAGES THE DEPOSIT ACTUALLY PAID, OR AN AMOUNT THEREFROM, NOT MORE THAN 3% OF THE PURCHASE PRICE AND PROMPTLY RETURN ANY EXCESS TO BUYER. BUYER AND SELLER AGREE TO EXECUTE A SIMILAR LIQUIDATED DAMAGES PROVISION; SUCH AS CALIFORNIA ASSOCIATION OF REALTORS RECEIPT FOR INCREASED DEPOSIT (RID-11), FOR ANY INCREASED DEPOSITS. (FUNDS DEPOSITED IN TRUST EENT OFCOUNTS OR A DISPUTE. N RELEASE OF FUNDS ESCROW ARE NOT EREQUIR RLEASE EQUIRES WRITTEN A AGREEMENTLLY IN FVTHE PARTIE=JCIAL DECISION OR ARBITRATION.)o.�" �C _ 'BUYER'S INITIALS SELLER'S INITIALS W,�-C-DA — c o ,7n.-),--o� AS A MATTER OF RECORD ONLY, WITH WHICH ESCROW HOLDER IS NOT TO BE CONCERNED: A. State law requires that residences by equipped with an operable smoke detector(s). Local law may have additional requirements. ten compliance in Buyer ent accordance with appli atbe to Land local law oflaw prior to close of escrow. B. Unless exempt, Seller shall comply with Civil Code 1102 et seq., by providing Buyer with a Real Estate Transfer Disclosure Statement. Seller shall provide Buyer with a Real Estate Transfer Disclosure Statement within 20 calendar days of Seller's acceptance after which Buyer shall have 3 days after delivery to Buyer, in person, or five days after delivery by deposit in the r ('6 mail, to terminate this agreement by delivery of a written notice of termination to Seller or Seller's Agent. Escrow Holders General Provision Instructions are attached hereto and incorporated herein. SELLER: THE J. WILLIAM AND MONIQUE T. BACK FAMILY TRUST i Monique re c en An erson Co -Trustee 5 BUYER: r � r NOTI E TO BUYER ON DISPOSITION OF -CALIF'ORPIIA REAL PROPERTY BUYER IS . CALIFORNIA REVENUENOTIFIED TAXATION WITHHOLDING PROVISIONS E SECTIONS 18805 18815 AND 26131, APPLICABLE TO CERTAIN SALES OF CALIFORNIA REAL ESTATE BY NONRESIDENT SELLERS. BUYER UNDERSTANDS THAT IN NO EVENT WILL ESCROW HOLDER UNDERTAKE TO ADVISE BUYER AND/OR BUYER'S REPRESENTATIVE(S) ON THE POSSIBLE TRANSACTION. OF BUYER THE AUNDERSTANDSBOVE CODE S THAT TIONSTO THIS UNLESS EXPRESSLY IC INSTRUCTED BY THE SELLER AND BUYER HEREIN, ESCROW HOLDER WILL NOT ASSIST IN THE WITHHOLDING OF SELLER'S FUNDS AND REMITTANCE OF SAME TO THE FRANCHISE TAX BOARD. IN THE EVENT THIS IS REQUESTED, THE PARTIES HERETO SHALL SUBMIT TO ESCROW THE COMPLETED AND NECESSARY TAX FORMS IN ADDITION TO INSTRUCTIONSTAS HE TO THE PROPER DISBURSING SHALL AGREE OF FUNDS. AT THAT TIME, TO COOPERATE FULLY IN PROVIDING NECESSARY INFORMATION AND TO INDEMNIFY ESCROW HOLDER AND HOLD ESCROW HOLDER HARMLESS IN THE EVENT OF NONCOMPLIANCE RESULTING FROM INFORMATION SUPPLIED BY THE UNDERSIGNED. A FEE FOR THIS SERVICE WILL BE CHARGED. FOR ADDITIONAL INFORMATION CONCERNING THE WITHHOLDING PROVISIONS REFERENCED ABOVE, PLEASE CONTACT THE FRANCHISE TAX BOARD WITHHOLDING AT SOURCE UNIT.AT 916-369-4900 OR WRITE TO THEM AT P.O. BOX 651, SACRAMENTO, CALIFORNIA 95812- 0651. RECEIPT ACKNOWLEDGED THIS DAY OF 119 SELLER r is Fidelity National Title INSURANCE COMPANY ESCROW INSTRUCTIONS (continued) DATE: March 11, 1991 ESCROW NO: 611758 ESCROW OFFICER: Dianne Sheridan GENERAL PROVISIONS 1. DEPOSIT OF FUNDS Insurance Code Section 12413 mandates all funds must be "available as a matter of right" prior to disbursement. DELAYS IN CLOSING will Occur if closing funds are other than bank wire, cashiers check or similar type items drawn on a California bank. All funds received in this escrow shall be deposited with other escrow funds in a gen- eral escrow account or accounts of FIDELITY NATIONAL TITLE INSURANCE COMPANY, with any state or national bank, and may be transferred to any other such general escrow account or accounts. Said funds will not earn Interest unless other- wise specifically stated herein. All disbursements shall be made by check Of FIDELITY NATIONAL TITLE INSURANCE COMPANY, 11 for any reason funds are retained or remain in escrow, you are to deduct there- from a reasonable monthly charge as custodian thereof of not less than $10.00 per month. 2. PRORATIO14S AND ADJUSTMENTS All proration and/or adjustments called for in this escrow are to be made on the basis of a thirty (30) day month unless otherwise instructed in writing. Thephrase "Close of escrow" (COE or CE) as used In this escmw means the date on which documents are recorded and relates only in proration andforadjustments unlessotherwise specified. You are to use information contained on last available tax statement, rental statement e provided by the seller, beneficiary's statement and Ore insurance policies delivered into escrow for the prorates provided for herein. 3. RECORDATION OF INSTRUMENTS Recordation of any instruments delivered through this escrow. If necessary or proper for the issuance of the policy of title insurance called for, is authorized. 4. AUTHORIZATION TO FURNISH COPIES You are authorized to furnish copies of these instructions, supplements, amend marts. or notices of cancellation and dosing statements In this escrow, to the,Real Estate Brokers(s) and Lenders(s) named in this escrow. S. AUTHORIZATION POLIO ES EXECUTE ASSIGNMENT OF HAZARD Either Buyer, Seller and/or Lenderwill hardyou Insurance agent and insurance Per - icy information and you are to execute. On behalf of the principals hereto, farm assign- ments of interest in any Insurance policy (other than title insumme) called th for in is escrow, forward assignment and policy to the insurance agent. requesting that insurer consent to such transfer andfor attach a loss payable clause and/or such other endorse - mans w may be required. and, forward such policy(s) to the prjncipals entNed thereto. It is not your responsibility to verity the information handed you or the assignability of said Insurance, your sole duty is to forward said request to Insurance agent at dose of escrow. 6. PERSONAL PROPERTY entofpersonalproperty taxes No examination or insurance a to the amount or paym Is required unless specifically requested. 7. RIGHT OF CANCELLATION - Any principal instructing you to cancel this escrow shall file notice of cancellation in your office in writing. You shall "thin two (2) working days thereafter mail, by eemfied mail, one copy of such notice to each of the other principals at the addresses stated In this escrow. UNLESS WRITTEN OBJECTION TO CANCELLATION IS FILED IN YOUR OFFICE BY A PRINCIPAL WITHIN TEN (M) DAYS AFTER DATE OF SUCH MAILING. YOU ARE AUTHORIZED TO COMPLY WITH SUCH NOTICE AND DEMAND PAYMENT OF YOUR CANCELLATION CHARGES. If written abjection is filed. you are authorized to hold all money and Instruments in this escrow and take no further action until otherwise directed, either by the principals' mutual written instructions. or final order of a court of competent jurisdiction. 8. ACTION IN INTERPLEADER The principals hereto expressly agree that you, as escrow holder, have the abso- lute right at your election to file an action in interpleader requiring the principals to answer and litigate their several claims and rights among themselves and you are aulhonzed to deposit With the clerk of the coun all documents and funds held in this esi:rOW the event ,solseee verally pay your can - "Italian charges and costs, expenses and reasonable attomey'sfees whyou are required to expend or incur in such interpleader action, the amount thereof to be fixed and judgment therefor to be rendered by the court. Upon the filing of such action, you shall thereupon be fully released and discharged from all obligations to further per- form any duties or obligations otherwise imposed by the terms of this escrow. 9. TERMINATION OF AGENCY OBLIGATION If there is no action taken on this escrow within six (6) months after the "time limit date' as set forth in the escrow instructions or written extension thereof. your agency obligation shall terminate at your option and all documents. monies or other items held by you shall be returned to the parties depositing same. In the event of cancellation of this escrow, whether it be at the request Of any of the principals Or otherwise. the lees and charges due FIDELITY NATIONAL TITLE INSURANCE COMPANY, including expenditures incurred andor authorized shall be borne equally by the parties hereto (unless otherwise agreed to specifically). 10..CONFLICTING INSTRUCTIONS Upon receipt of arry wrillicting instructions other than cancellation instructions, you are no longer Obligated to lake any further action in connection with this escrow until further consistent instructions are received from the principals to this escrow except as provided in Paragraph 7 of these General Provisions. 11. DELIVERY/RECEIPT Delivery to Buyer and/or Seller as used in these instructions is to be by regular mail, and receipt is determined to be 72 hours after such mailing unless otherwise stated herein. 12. STATEIFEDERAL CODE NOTIFICATIONS Pursuant to Section 480.3 of Revenue and Taxation code of the State of California pnorto the Close of escrow. Buyerwill pmvide Escrow Holder with a Preliminary Change of Ownership Report. In the event said report is not handed to Escrow Holder for sub- mission to the County in which subject property is located, upon recording of the Grant Deed. Buyers acknowledge that the applicable fee will be assessed by said county and Escrow Holder shall debit the account of Buyer for mine at close of escrow. Further. Buyers acknowledge that this lack of submission may Impact certain provisions under the Owners Policy of Tide Insurance issued at close of this escrow. Pursuant to Foreign investors in Real Property Tax Act, the Internal Revenue Code, Sections 1445 and 6039 C. Buyer and Seller herein represent and warrant that they will seek and obtain independent legal advice and counsel relative to their obligations and Will take all steps In order to comply with such requirements and agree to hold you harmless relative to their compliance therewith. 13. ENCUMBRANCES to lacetifiamcondttioncalled Youareaulhorizedtopayallencumbrancesnecessary P for herein, including but not limited to prepayment penalties, vnthoul further approval of the undersigned. 14. USURY You are not to be wncamed with any, question of usury in any loan or encumbrance involved in the processing of this escrow and you are hereby released of any respon- sibility, or liability therefor. 15. DISCLOSURE Your knowledge of maners afteeting the property, provided such fads do not pre- vent your compliance with these instructions, does not create any liability or duty in addition to your responsibility, under these instructions. 16. COUNTERPARTS These instructions, and any amendments orsupplements thereto. maybe executed in arty number of counterparts. each of which shall be deemed an original, regardless of the date of execution and delivery. All such counterparts shall constitute one and the same document. ALL DOCUMENTS. BALANCES AND STATEMENTS DUE THE UNDERSIGNED ARE TO BE MAILED TO THE ADDRESS SHOWN BELOW. MY SIGNATURE HERETO CONSTITUTES INSTRUCTION TO ESCROW HOLDER OF ALL TERMS AND CONDITIONS CONTAINED 114 THIS AND ALL PRECEUING PAGES AND FURTHER SIGNIFIES THAT I HAVE READ AND UNDERSTAND THESE GENERAL PROVISIONS. 09/10/91 0933 FIDELITY NFTIONFL TIT April 30, 1991 Ms. Dianne Sheridan Senior Escrow Officer Fidelity National Title 21oo S.B. Main St., Suite 400 Irvine, CA 92714 Re: Escrow #611758 Dear Ms. Sheridan: The undersigned hereby elects to extend the financing contingency until Wednesday, May 15, 1991. We understand that the buyer is continuing their effort to find financing. We have made an offer to carry back at note and thus solve the problam. Thank you for you cooparatiOn. retchen Back, Trustee J. William and Monique T. Back Trust GB:cah MAY 7 1991 VIOFt -Ty �CIONAt- 0 CITY OF NEW -PORT BEACH Office of City Manager (714) 644-3002 May 23, 1991 Mr. Timothy R. Busch The Busch Firm Attorneys and Counselors at Law 19000 MacArthur Blvd., Suite 125 Irvine, CA 92715 Subject: #62 Beacon Bay - File No. 2011-6.1 C. Kent Freudt and Barbara Casey Freudt Dear Mr. Busch: Enclosed please find two (2) original Leases, one (1) Memorandum of Lease and one (1) Termination of Lease. The Termination of Lease is to be signed by the sellers, J. William Back and Monique T. Back and notarized. The Leases and Memorandum of Lease are to be signed by the buyers, C. Ken Freudt and Barbara Casey Freudt and only the Memorandum of Lease notarized. After obtaining all signatures please return to the City for signatures. If you have any questions please feel free to give me a call. Sincerely, l� O Marion Brockman/for Kenneth J. Delino mb enclosures City Hall • 3300 Newport Boulevard 0 P.O. Box 1768 0 Newport Beach, California 92659-1768 ATTORNEYS 'Timothy R. Busch, J.D., CPA Rick S. Weiner, J.D., CPA "Edward P. Schroeder, J.D., CPA —Dominic Kracht, J.D., LLM., CPA "'Gerald L. Larsen, J.D., LLM., CPA rI THE BUSCH FIRM A PROFESSIONAL LEGAL CORPORATION ATTORNEYS AND COUNSELORS AT LAW 19000 MacArthur Blvd., Suite 125 Irvine, California 92715 (714) 474-7368 FAX (714) 474.7732 May 17, 1991 Mr. Ken Delino Deputy City Manager 3300 Newport Blvd. Newport Beach, CA 92663 RE: Our File No. 2011-6.1 Dear Mr. Delino: ACCOUNTAMS Gregory A. Busch, CPA Koren M. Busch, CPA Pursuant to my secretary's conversation on this date with Marian Brockman, enclosed please find a preliminary draft of the Assignment of Leasehold Interest for property located in Beacon Bay. I have enclosed a copy of the Lease and a copy of the recorded Memorandum of Lease for your use. Please review the Assignment and call or write to this office with any modifications which the City may require before submitting it to the City for final execution. If you should have any questions, please feel free to call the undersigned. TRB/cp Enclosure Tckl:CP:5:30:91 Very truly your, �K14 TIMOTHY R. BUSCH on behalf of THE BUSCH FIRM, P.C. Also ilcensed In *Michigan **Indiana •••Licensed In Florida only lJ 0 m► Ni .4WO Uv� G �R � �.2�cfioWS e Row ` w o n �oncG.ccn-ems ls.��►''�. -• —• PRELIMI 1 CDRAFT ''JI '� 9j 0 The Busch Firm, P.C. ASSIGNMENT OF LEASEHOLD INTEREST For payment of ONE MILLION ONE HUNDRED FIFTY THOUSAND DOLLARS ($1,150,000.00) and other good and valuable consideration, receipt of which is hereby admitted and acknowledged, the undersigned, Trustee of the J. WILLIAM BACK and MONIQUE T. BACK TRUST, dated ("Assignor"), as Lessee under a certain leasehold, upon the terms, convenants, conditions and provisions therein set forth dated November 13, 1989, with the City of Newport Beach, a Chartered Municipal Corporation, as Lessor, and recorded December 20, 1989, as instrument No. 89-687991 in the official records for the County of Orange ("Ground Lease"), to C. KENT FREUNDT and BARBARA CASEY FREUNDT, husband and wife, as community property, having their personal place of residence located at 62 Beacon Bay, Newport Beach, California 92660 ("Assignee"). The terms of the Ground Lease relate to a period November 13, 1989, until July 1, 2006, with respect to the following described property: Lot 1 of the eastside addition to Beacon Bay recorded on the official maps book 2, page 30, in the Office of the County Recorder, County of Orange, State of California (sometimes referred to as Beacon Bay Lot 62). Dated: MONIQUE GRETCHEN ANDERSON, as Sole Trustee of the J. WILLIAM BACK AND MONIQUE T. BACK TRUST dated "Assignor" STATE OF CALIFORNIA) COUNTY OF ORANGE ) On , 1991, before me, (Notary Name), a notary public, personally appeared MONIQUE GRETCHEN ANDERSON, personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument as Sole Trustee of the J. WILLIAM BACK AND MONIQUE T. BACK TRUST dated and acknowledged to me that she execute the same in her aut orized capacity, and that by her signature on the instrument, the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. (Notary Signature) -1- Ll The undersigned, C. KENT FREUNDT and BARBARA CASEY FREUNDT, husband and wife, as community property, the Assignee named in the foregoing Assignment, hereby accepts said assignment and hereby jointly and severally agree to keep, perform and be bound by the terms, covenants and conditions contained in the Ground Lease described in said Assignment on the part of the lessee therein to be kept and performed, for all intents and purposes as though the undersigned Assignee were the original Lessee thereunder. Dated: C. KENT FREUNDT BARBARA CASEY FREUNDT "Assignee" STATE OF CALIFORNIA COUNTY -OF ORANGE On , 1991, before me, (Notary Name), a notary public, personally appeared C. KENT FREUNDT and BARBARA CASEY FREUNDT, personally known to me (or proved to me on the basis of satisfactory evidence) to be the persons whose names are subscribed to the within instrument as individuals and acknowledged to me that they executed the same in their authorized capacity, and that by their signature on the instrument, the persons, or the entity upon behalf of which the persons acted, executed the instrument. WITNESS my hand and official seal. (Notary Signature) PREPARED BY AND WHEN RECORDED, RETURN TO: Timothy R. Busch THE BUSCH FIRM, P.C. 19000 MacArthur Blvd., Ste. 125 Irvine, California 92715 (714) 474-7368 ALL FUTURE TAX BILLS ARE TO BE SENT TO: C. KENT FREUNDT and BARBARA CASEY FREUNDT 62 Beacon Bay Newport Beach, California 92660 <02>2011/ASSIGNMENT -2- CONSENT TO ASSIGNMENT The undersigned, City of Newport Beach, a Chartered Municipal corporation, having its principal place of business located at ("Lessor") is the Lessor under said Ground Lease aforementioned and hereby consents to the assignment of the Ground Lease referred to in the foregoing Assignment, without waiving its right under the Ground Lease to consent to�future assignments of the leasehold interest thereunder and hereby accepts the Assignee named in the Assignment, as the lessee under the Ground Lease, for all intents and purposes as if the Assignees were the original lessees thereunder. By execution of this Consent to Assignment, the Lessor does hereby represent and warrant that as of this date, all of the terms and conditions of the Ground Lease are in full force and effect, and that no notification of default has been tendered to the Assignor in connection with the Ground Lease Agreement. The Lessor acknowledges receipt of the executed copy of the Assignment pursuant to the provisions of paragraph 4A of the Ground Lease. The Lessor acknowledges the assessment of a transfer fee of $50.00 in accordance with paragraph 4C. The Lessor acknowledges the base rent will be adjusted to an annual rent of $28,750.00 pursuant to paragraph 4D(2), payable in monthly installments of $2,395.83 on the first day of each month, beginning on the first day of the month following the date of transfer, based on 2.5% of the transfer value of the leasehold and improvements of $1,150,000. The Lessor represents that no other changes shall occur in connection with the Ground Lease Agreement. Dated: ATTEST: City Clerk APPROVED AS TO FORM. City Attorney CITY OF NEWPORT BEACH, a Chartered Municipal Corporation By: Mayor -3- STATE OF CALIFORNIA) COUNTY OF ORANGE ) On , 1991, before me, (Notary Name), a notary public, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument as Mayor of the CITY OF NEWPORT BEACH, a Chartered Municipal Corporation and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument, the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. (Notary Signature) STATE OF CALIFORNIA) COUNTY OF ORANGE ) On , 1991, before me, (Notary Name), a notary public, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument as City Clerk of the CITY OF NEWPORT BEACH, a Chartered Municipal Corporation and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument, the person, or the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and official seal. (Notary Signature) -4- 10 t0 STATE OF CALIFORNIA) COUNTY OF ORANGE ) On , 1991, before me, (Notary Name), a notary public, personally appeared , personally, known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name,is subscribed to the within instrument as City Attorney of the CITY OF NEWPORT BEACH, a Chartered Municipal Corporation, and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument, the person, or the entity upon behalf of which the person acted, executed the instrument. y WITNESS my hand and official seal. (Notary Signature) <02>2011/ASSIGNMENT -5- agWPpRT CITY OF NEWPORT BEACH RECEIPT p" dm NEWPORT BEACH. CALIFORNIA 92663 No. 73324 P -�27 99l �pFOPP� DATE Y OF NEWPORT BEA NEWPORT BEACH, CALIFORNIA 92663 3 19 9i DATE RECEIVED FROM RECEIPT No. 71574 K m-c 6.?j 0� ...�/rl DEPARTMENT VV V BY� 0 CITY OF NEWPORT BEACH Office of City Manager (714) 644-3002 December 4, 1989 Lee A. Branch County Recorder 630 N. Broadway, Room 101 P. 0. Box 238 Santa Ana, CA 92702 Attention: Mary E. Fox Deputy Recorder Subject: Termination of Leasehold & .Memorandum of Lease Dear Ms. Fox: The subject documents were returned to the City unrecorded with a request for a $9.00 charge. The subject documents are for the benefit of the City of Newport Beach, and our Exempt Government Code Number is 6103. Thank you for your help in recording these documents. Sincerely, Marion Brockman mb Enclosures aCity Hall 0 3300 Newport Boulevard • P.O. Box 1768 0 Newport Beach, California 92658-8915 City of Newport P.O. Box 1768 Newport Beach, Ah Beach 1Y O F N G E CA 92658-8915 LEE A. BRANCH COUNTY RECORDER 10 COUNTY RECORDER: 630 N. Broadway, Rm. 101 P,O. Box 238 Santa Ana, CA 92702 Telephone: 7141834-2500 November 28, 1989 We are returning UNRECORDED Termination of Leasehold/Memorandum of Lease naming Back together with your remittance of $none, Ck. No_. none. Regarding the Termination of Leasehold Effective January 1, 1985, fees for recording a Encumbrance, or Notice originally recorded by a County, State, District or Political Subdivision The correct fees will be $9.00. LEE A. BRANCH COUNTY RECORDER By Mary E. Fox Deputy Recorder MEF:jg Release of Lien, City, are $9.00. 0 0 J. TODD ANDERSON, ATTORNEY AT LAW 13191 Crossroads Parkway North . Sixth Floor • City of Industry, CA 91746-3497 Telephone(213) 692-9561 FAX(213) 695.2329 November 13, 1989 Mr. Kenneth J. Delino City of Newport Beach P.O. Box 1768 Newport Beach, California 92658-8915 Re: 62 Beacon Bay Dear Mr. Delino: I enclose two originals of the Lease for the above referenced property signed by J. William Back and Monique T. Back, Trustors of the Back Trust. I also enclose an executed and notarized Memorandum of Lease and Termination of Leasehold for recordation. Last, although I am not sure if this is required, I have prepared a Preliminary Change of Ownership Report. When these documents have been executed by the city, please send me one original Lease as well as a copy of the fully executed Memorandum of Lease and Termination of Leasehold. I assume you will look after the recordation. Thank you for your attention to this matter. 3Very truly you , J. T dd An rson JTA:dh Enclosures DLL JACOBS �r ORF COUNEYTY ASSESSOR M PRELIMINARY CHANGE OF OWNERSHIP REPORT 9<�Foa� (To be completed by transferee (e.g., buyer) prior to transfer of subject property in accordance with Section 480.3 of the Revenue and Taxation Code and filed with the Orange County Recorder at the time of submittal of the document for recording. This forth is acceptable in any county.) SELLER/TRANSFEROR: BUYER/TRANSFEREE: ASSESSOR'S PARCEL NUMBER: UDU—GIG—UU7 LEGAL DESCRIPTION: T,nt 7 of tha Past' si_dA addition 1-n RPanon 'R ADDRESS/LOCATION OF PROPERTY: 62 Beacon Bay, Newport Beach MAIL TAX INFORMATION TO: Name M. Gretchen Andersaa Address: 1611 Ramona Avenue South Pasadena CA 91030 For assistance in completing this torn, please call the Orange County Assessor at (714) 834.5031. The property which you acquired may be subject to a supplemental assessment in an amount to be determined by the Orange County Assessor. For further information on your supplemental roll obligation, please call the Orange County Assessor at834-2941. FOR RECORDER'S USE ONLY PART 1. TRANSFER INFORMATION Please answer all questions. YES NO FOR ASSESSOR'S USE ONLY APN RA YO NO GRID MULTO REC DATE PP NV ❑ M A. Is this transfer solely between husband and wife? (Addition of a spouse, death of a spouse, divorce settlement, etc) ❑ M B. Is this transaction only a correction of the name(s) of the person(s) holding title to the property? (For example, a name change upon marriage) ❑ M C. Is this document recorded to create, terminate, or reconvey a lender's interest in the property? ❑ Q D. Is this transaction recorded only to create, terminate, or reconvey a security interest (e.g., cosigner)? ❑ ® E. Is this document recorded to substitute a trustee under a deed of trust, mortgage, or other similar document? ❑ Z) F. Did this transfer result in the creation of a joint tenancy In which the seller (transferor) remains as one of,,the.joint tenants? ❑ M G. Does this transfer return property to the person who created the joint tenancy (original transferor)? H. Is this transfer of property: ❑ 1. to a trust for the benefit of the grantor, or grantor's spouse? ❑ 2. to a trust revocable by the transferor? ❑ ® 3. to a trust from which the property reverts to the grantor within 12 years? ❑ ® I. If this property is subject to a lease, is the remaining lease term 35 years or more including written options? ❑ ❑ J. Is this a transfer from parents to children or from children to parents? ❑ ® K. Is this transaction to replace a principal residence located In Orange County by a person 55 years of age orolder?r If you checked yes to J or K, an applicable claim form must be flied with the County Assessor. Please provide any other Information that would help the Assessor to understand the nature of the transfer. IF YOU HAVE ANSWERED "YES" TO ANY OF THE ABOVE QUESTIONS EXCEPT K, PLEASE SIGN AND DATE, OTHERWISE COMPLETE BALANCE OF THE FORM. PART It: OTHER TRANSFER INFORMATION A. Date of transfer if other than recording date B. Type of transfer. Please check appropriate box. ❑ Purchase ❑ Foreclosure [I Gift ❑ Trade or Exchange ❑ Contract of Sale — Date of Contract ❑ Inheritance — Date of Death ❑ Other: Please explain: C]Creation of a Lease; ❑ Assignment of a Lease; ❑ Termination of a Lease C. Date lease began Original term in years (including written options) — Remaining term in years (including written options) Was only a partial interest in the property transferred? If yes, Indicate the percentage transferred ❑ Yes ❑ No F0128.213.4(133188)® 9EUMINARY CHANGE OF OWNERSHIP REPORT Please answer, to the best of your knowledge, all applicable questions, sign and date. It a question does not apply, indicate with "N/A." PART III: PURCHASE PRICE 6 TERMS OF SALE A. CASH DOWN PAYMENT OR Value of Trade or Exchange (excluding closing cost) Amount S B. FIRST DEED OF TRUST @ % Interest for years. Pymts./Mo. = $ (Pdn. d, Int. only) Amount S ❑ FHA ❑ Fixed Rate I] New Loan ❑ Conventional ❑ Variable Rate ❑ Assumed Existing Loan Balance ❑ VA ❑ All Inclusive D.T. (S Wrapped) ❑ Bank or Savings & Loan ❑ Cal -Vet ❑ Loan Carded by Seiler ❑ Finance Company Balloon Payment ❑ Yes ❑ No Due Date Amount $ C. SECOND DEED OF TRUST@ %interest for years.Pymts./Mo. = $(PrIn.6Int. only) Amount S ❑ Bank or Savings d Loan ❑ Fixed Rate ❑ New Loan ❑ Loan Carded by Seller ❑ Variable Rate ❑ Assumed Existing Loan Balance Balloon Payment ❑ Yes ❑ No Due Date Mount $ D. OTHER FINANCING: Is other financing Involved not covered In (b) or (a) above? ❑ Yes ❑ No Amount $ Type @ % Interest for years. Pymts./Mo. x $ (Pdn. h Int. only) ❑ Bank or Savings 6 Loan ❑ Fixed Rate ❑ New Loan ❑ Loan Carried by Seller ❑ Variable Rate ❑ Assumed Existing Loan Balance Balloon Payment ❑ Yes ❑ No Due Data Mount 9 E. IMPROVEMENTSOND ❑ Yes ❑ No Outstanding Balance: Amount $ F. TOTAL PURCHASE PRICE (or acquisition price, If traded or oxahanged, Include real estate commission If paid.) Total Items A E $ through Please explain any special terms or financing and any other Information that would help the Assessor understand the purchase price and terms of sale. PANT IV: PROPERTY INFORMATION A, IS PERSONAL PROPERTY INCLUDED IN THE PURCHASE PRICE? (other than a mobilehome subject to local property lax)? ❑ Yes ❑ No It yes, enter the value of the personal property Included In the purchase price $ (Attach itemized list of personal property) B. IS THIS PROPERTY INTENDED AS YOUR PRINCIPAL RESIDENCE: ❑ Yes ❑ No Ifyes,enter date ofoccupancy , 19—or Intended occupancy Month/ Day Maas/ D�y19_. C. TYPE OF PROPERTY TRANSFERRED: ❑ Single-family residence ❑ Agricultural ❑ Timeshare ❑ Multlple-famlly residence (no, of units: ) ❑ Co-op/Owo-your-own Q Mobliehorne ❑ Commercial/Industrial ❑ Condominium ❑ Unimproved lot ❑ Other (Description: ) 0. DOES THE PROPERTY PRODUCE INCOME? ❑ Yes ❑ No E. IF THE ANSWER TO QUESTION D IS YES, IS THE INCOME FROM: ❑ Lease/Rent ❑ Contract ❑ Mineral Rights ❑ Other —explain: Enter here, or on an attached sheet, any other Information that would assist the Assessor In determining value of the property such as the physical condition of the property, restrictions, etc. Pie e P ame of Now Owner/Legal Representative/Corporate Officer J . •roau Anclerson. !, PfiknWo. where you are available from 8..,W a.m.-5:00 p.m. (219) 948-4350 (NOTE., The Assessormay contact you for turdrer Information) If a document evidencing a change of ownership is presented to the recorder for recordation without the concurrent riling of a preliminary change of ownership report, the recorder may charge an additional recording fee of twenty dollars ($20). The additional fee shall not be charged If the document Is accompanied an affidavit that the transferee is rot a resident of California. AFFIDAVIT OF NON-RESIDENT TRANSFEREE The Transferee (buyer) named above Is a resident of site and not a resident of the State of California. Signed g (Now gwh»r/Legal RepresentalNe/Caporalo Officer) Date: • f CITY OF NEWPORT BEACH MEMORANDUM: FrOM KENNETH J. DELINO TO, ......... J,•. TODD•_ANDERSON NOVEMBER 1 ................ RE: 62 BEACON BAY Please have documents signed by the Backs and return to City for signatures. Also have the Backs notarize the Termination of Lease and the Memorandum of Lease. Thank you., Reply wanted ❑ Reply not necessary ❑ tan.m. Enclosures 10.89.. KENNETH J. DE INO ,ate >y` {t • •;Eni J;i ` £ir i' 3. 4ot {}} ' 1 :'3' . •' ¢i{ fi ,'i. �; - .e;, ,;g;, :r a i '�? . t 3 i • ».` , : 'i(.. - ;3 >i F;f :3 t:, ., i fUA` c� ;.�, - +.• . . ..i;, r, {a.ri:F ,t, :�°•�. �'��5'T<.�;�rEy,:l iE�;iy.'�is.�q..:e� 'o- .•f.i, i{i, .i`; ,S,o<: .,ads; II=; ,t„ 's • 3i E ;{Fi: It " {{ • f{ 1 THE J. WIILIAM AND MONIQUE T. BACK TRUST _J 14ILLIA-I BACK and MONIQUE T. BACK Trustors J. WILLIAM BACK and MONIQUE T. BACK, Trustees ,t DECLARATION OF TRUST 1 9 8 2 Introductory Clause and Recitals -- Family data; transfer in trust; trust purpose; agreement as to community property; additions to trust; "Trust Estate" I. RIGF?TS P.ESERVED By TRUSTORS A. Pevocation or Amen ment B. Powers Reserved in Life Insurance Policies C. Possession of Life Insurance Policies -- Owner D. Distribution to Trustors During Joint Lifetimes II. SURVIVOR'S ELECTIO?: OR PARTIAL REVOCATION A. Method of E ecting or Revoking B. Effect of Action, of Surviving Trustor C.'' Effect of No Election or Partial Revocation III. DUTIES OF TRUSTEE AS TO It',SURAITCE POLICIES A. a e eeping o o ides an ayment o Premiums B. Collection of Proceeds of Policies C. Liability of Insurance Company D. Insurance on Surviving Trustor -- Special Trustee IV. DIVISIO11 OF TRUST ESTATE AND PAYMIENT OF EXPENSES es o Trust A Funmen oeral andELastsIllness, Taxesnand sDebtson, B. Division of Trust Estate 1. TRUST A named after Trustors' Child 2. TRUST B named after surviving Trustor 3. TRUST C named after decedent C. Simultaneous Death or Death within 180 Days D. Intention of Trustors to Obtain Marital Deduction E. Allocation of Treasury Bonds and Life Insurance V. DISTRIBUTION OF INCOME AND PRINCIPAL OF TRUST "A"' and "C" A. TRUST A -- Distri ution o Net Income in Discretion of Trustee B. TRUST A -- Death of Second Trustor, Divide in Shares For Issue: 1. Trust for Child a. Distribution of Income and Principal in Trustee's Discretion Until Child Age 25 - 1 - b. At Age 25, Distribute Income; Distribute 1/3 of Principal at Age 30, Balance at Age 35 c. At Death of Child, Distribute to Issue if Over . Age 21, If Not, Add to Paragraph 2 2. Trust for Grandchildren C. TRUST C -- Distribution of Income to Survivor D. Ultimate Distribution -- Heirs VI. DISTRIBUTION OF INCOME AND PRINCIPAL OF TRUST "B" A. Distri u-Ion o Net Income to Surviving Trustor B. Surviving Trustor's Fight of Withdrawal - $75,000 or 15" C. General Power of Appointment in Surviving Trustor; If not Exercised, Add to TRUST A VII. TRUSTEE, SUCCESSOR, AND COMPENSATION A. Trust A ministration; Delegation, Power to Act B. Resignation or Death of Trustee C. Substitution of Trustee D. Power of Successor Trustee ECompensation of Trustee F.. Bond of Trustee G. Designation of Successor Trustee by Trustors VIII. POWERS AND DISCRETIOI:S A-. - Genera Powers 1. Retention of Power 2. Investments 3, Management of Securities 4. Use of Nominee 5. Sale, Exchange, Repair 6. Leases 7. Loans 8. Insurance 9. Litigation B. Special Powers 1. Determination of Income and Principal 2. Bonds Purchased at Discount or at Premium 3. Capital Gains Distri'�ution 4. Physical Division of Trust Property Not Required 5. Distribution in Kind 6. Withhold Payments if Conflicting Claims 7Payments to Beneficiaries 8.. Invasion of Principal for Beneficiaries 9.' Use of Real Property 10. Use of Tangible Personal Property 11. Purchase of Assets or Loans from Estate 12. Payment of Death and Gift Tax, or of Last Illness and Funeral Expenses - 2 - r] 13. Purchase of Treasury Bonds Redeemable at Par 14. Minimized Tax Liabilities 15. Release of Powers 16. Advisers of the Trustee 17. Termination of Small Trust Estate 18. Delayed Termination 19. Deferred Division or Distribution of Trust Assets IX. GENERAL PROVISIONS A. pen t ri,t Clause B. Rule Against Perpetuities C. Construction D. Exercise of Trustee's Discretion E. Meaning and References F. Gender and Number G. Definition of "Education" H. Headings I. Situs - Law Governing Trust J. Severability K. Notices of Trustee of Event Affecting Interest L. Instrument of Trustee PI. Accounting IT. Accrued Income -- Death of Beneficiary 0.••No Apportionment of Expenses p, Consideration of Outside Resources of Beneficiaries Q. Power to Withdraw or to Appoint Non -Cumulative R. Exercise of a Power of Appointment 1. Where general power of appointment created 2. Where limited power of appointment created S. Guardian or Conservator T. Contest of Will or Trust by Beneficiary U. Certification V. Names of Trusts - 3 - THE J. WILLIAM AND MONIQUE T. BACK TRUST DECLARATION OF TRUST 1 9 8 2 J. WILLIAM BACK and MONIQLT T. BACK, Trustors J. WILLIAM BACK and MONIQUE T. BACK, Trustees HARRY A. OLIVAR, Attorney at Law Johnson, Bannon, Wohlwend & Johnston 1800 Avenue of the Stars, #435 Los Angeles, California 90067 Telephone: (213) 552-0175 Dated: September 15, 1982 Tax. I.D. #95-6772240 DECLARATION OF TRUST THIS DECLARATION OF TRUST is executed on the date hereinbelow written by J. WILLIAM BACK and MONIQUE T. BACK (hereinafter jointly referred to as "Trustee"), on behalf of J. WILLIAM BACK and MONIQUE T. BACK (hereinafter jointly �� referred to as "Trustors", or separately as "Trust or -Husband or "Husthisbdocument shalltbe-`"Wife"). f) referredtoas"THEhJ.Trust created by WILLIAM AND MONIQUE T. BACK TRUST". RECITALS The following facts and allegations are stated by Trustors to be true and correct and are agreed upon by the Trustors and the Trustee: Recital A: The Trustors are husband and wife and presently resat 107 Fremont Place, Los Angeles, California 90005. There are two (2) children of the Trustors marriage, being MONIQUE GRETCHEN BACK, born February 4, 1963, and JOSEPH WILLIAM BACK, born January 2, 1965. The Trustors have no deceased children leaving issue now living. Recital B: In order to provide for the financial security o eac Trustor and of their next•of kin, the Trustors have placed in trust with the Trustee, without consideration moving from the Trustee other than the promises and agreements contained herein, the initial sum of One Hundred Dollars ($100.00), receipt of which the Trustee hereby acknowledges, and have designated, or have stated that they will designate, this trust, or the successor Trustee herein, as the beneficiary under certain policies of life insurance upon the life of either Trustor, which policies are described in Schedule "A" attached hereto and made a part hereof. Any other assets added to the Trust Estate shall be designated as the Trustors' separate property, quasi -community property, or community property, attached to this Declaration as Schedule "B". "Quasi -community property" for purposes of this Trust shall havq the meaning defined by California Civil Code Section 4803. For purposes of convenience, any quasi -community property transferred to this Trust may hereafter be referred to as separate property. However, Trustors do not intend thereby to change the character of that property from quasi -community into separate property. Recital C: The objective which the Trustors wish to achieve un provisions of this instrument is to provide er t e the maximum financial security and comfort which can be provided by efficient and prudent management out of the financial resources available after the death of either Trustor for the - 1 - benefit of the surviving Trustor and the Trustor's next of kin.. For the guidance of the Trustee, but in no way placing any restrictions whatsoever upon the exercise of the discretions and powers hereinafter vested in the Trustee, the Trustors have stated that upon the death of either Trustor, the surviving- Trustor and the Trustor's next of kin as income beneficiaries, are to be the primary beneficiaries of these trusts during their lifetimes and that they shall continue after the death of the deceased Trustor to enjoy the same "standard of Living" to which they were accustomed during the lifetime of the deceased Trustor. Recital D: It is the intention of the Trustors that all community oper.ty, quasi -community property, and all separate property whether transferred to the Trust at this time or in the future, and all the proceeds thereof, shall continue to retain their original character as either community property, quasi -community, or separate property during the joint lifetimes of Trustor-Husband and Trustor-Wife, and that such property shall be held by the Trustee as either the community property of the Trustors, quasi -community property, or the separate property of the Trustor-Husband or Trustor-Wife, as designated in Schedule "A" or "B", under the laws of the State of California. Failure of the Trustors to designate the character of property shall have no effect on the validity of this Declaration of Trust, and no inference shall be drawn as to the nature or character of the property on account of any such failure. No provision of this Declaration of Trust shall change the character of such properties, or the rents, issues and profits therefrom, to other than their original character. It is further the intent of the Trustors that, in maintaining the Trustors' interests in community property, this instrument shall conform in all respects to California Civil Code Section 5113.5 as now enacted (and as to any future amendments), despite any inconsistent language herein, and that the Trustee have no more extensive power over any community property in the Trust Estate than either of the Trustors would have had under the California Civil Code, had the Trust not been created, and that this instrument shall be so interpreted to achieve these intentions. This limitation shall terminate on the death of either Trustor. Notwithstanding the foregoing, the Trustee shall have the power to convey, encumber or otherwise dispose of the community real and personal property held hereunder without the consent of a Trustor, only if the Trustor is then incapable of giving such consent. Recital E: The Trustors, or any other person, may at any time, wit t e consent of the Trustee, by any form of conveyance, including by Will, add to the Trust Estate, or any trust created herein, additional property, real or personal, including other life insurance policies (on Trustors or some - 2 - other person) and benefits under pension, profit sharing or other form of retirement plans, for investment in any trust and possibly for payment of premiums on insurance policies payable to the Trustee, whereupon such additional property shall become and be a part of this Declaration of Trust the same as if originally included herein. Recital F: All property, real or personal, now or hereafter su 7ect to the terms and provisions of this Declaration of Trust (including income thereon or increments thereto) is designated herein as "Trust Estate", and shall be held, administered and distributed in trust as provided herein. In addition, it is intended that this Trust shall receive the proceeds payable from any life insurance policies upon the lives of Trustors wherein the Trustee and/or this Trust is designated as beneficiary, and the rights as beneficiary acquired by the Trustee under any of said policies, together with any rights under other policies of insurance and any other property which may hereafter be conveyed or transferred to or received by the Trustee, to be held under the terms and conditions of this Trust, shall be a part of the Trust Estate herein. NOW, THEREFORE, in consideration of the covenants herein contained, it is agreed that the Trustee accepts such rights in and title to the Trust Estate as are conveyed or transferred to the Trustee hereunder, without liability or responsibility for the condition or validity of such rights or title, and the Trustee will hold, administer and distribute the Trust Estate, in trust, for the uses and purposes and upon the terms -and conditions hereinafter provided. - 3 - 0 A R T I C L E I RIGHTS RESERVED BY TRUSTORS The Trustors specifically reserve the following rights: A. Revocation or Amendment During the joint lifetimes of Trustor-Husband and Trustor-Wife, this Declaration of Trust may be revoked in whole or in part with respect to community property by an instrument in writing signed by either Trustor-Husband or by Trustor-Wife and delivered by certified mail to the Trustee and the other Trustor-Spouse, and with respect to separate property by an instrument in writing signed by the Trustor-Spouse who . contributed that property to the Trust -Estate, delivered by certified mail to the Trustee. On revocation, the Trustee shall promptly deliver to the Trustors jointly all or the designated portion of any community property of Trustor-Husband and Trustor-Wife, and which shall be held and managed by the Trustors as community property. With respect to separate property, upon a revocation, the Trustee shall promptly deliver to the contributing Trustor-Spouse all or the designated por- tion of that property. Prior to delivery of any property to Trustor-Husband or Trustor-Wife, the Trustee shall be indemnified to its satisfaction, and payment shall be made of all sums due the Trustee. Any such revocation shall be effective upon filing of the written notice with the Trustee and, if the death of the insured Trustor should occur before a change of beneficiary of any of the insurance policies or retirement plans becomes effective with the company or the Trustee of any such plan, any proceeds of such insurance or retirement plans received by the Trustee may be paid by it to the surviving Trustor if the Policy were the survivor's separate property, and if not, to the personal representative of the deceased Trustor, and the receipt of such personal representative shall be a full and complete acquittance and discharge from liability of the Trustee. Trustor-Husband and Trustor-Wife may at any time during their joint lifetimes amend any of the terms of this Declaration of Trust by an instrument in writing signed by both of them and delivered by certified mail to the Trustee. No amendment shall be effective unless accepted by the Trustee in writing. On the death of either Trustor, this Declaration of Trust shall become irrevocable and not subject to amendment to the extent of the decedent's separate property, if any, or to ART. I, P- 1 the extent of the decedent's community property share of the proceeds of the insurance policies or death benefits or other community property assets transferred to Trust A, as herein- after described. However, while living and competent, the surviving Trustot shall have an election as set forth in Article II, and shall have whatever rights of withdrawal or appointment over Trust B, as hereinafter described, to the degree allowable under the provisions of Article VI. During the lifetime of both Trustors, any co -Trustee may be removed as a Trustee upon written notice to all Trustees signed by both Trustors. No successor Trustee need be named upon such removal. B. Power Reserved in Life Insurance Policies The Trustors reserve, during their joint lifetimes, all of the rights and powers granted in any of the community property or separate property life insurance policies or retirem: nt benefit plans (to be exercised by them jointly if community, or by the owner if separate, without the consent or participation of the Trustee or any beneficiary of this Declaration of Trust) including the following: 1. To receive or apply dividends, distributive shares or surplus, disability benefits, premium refunds, proceeds of matured policies, loan, surrender or commuted values, or any other sum due under any such policies or plans. 2. To obtain and receive such advantages or loans as may be available under any such policies or plans. 3. To exercise any options or privileges granted in any such policies or plans, provided that Trustors shall not, without the consent of the Trustee, exercise any option whereby the proceeds of any such insurance policies would be payable to the Trustee other than in one lump sum. 4. To sell, assign, or pledge any such policies or Trustors' interest in any such plans. 5. To change the beneficiaries of any such policies or plans, provided that any change of beneficiary having the effect of making the proceeds of any such policies or plans payable to any beneficiary other than the Trustee, shall, upon becoming effective with the issuing company or the Trustee of such plan, revoke the Declaration of Trust as to such policies or plans. ART. I, p. 2 1J Ll 6. To withdraw and cancel or surrender any such policies or documents evidencing the interest in any such plans. C. Possession of Life Insurance Policies During the life of the insured, Trustors may remain in possession of any life insurance policy or policies under which the Trustee has been named beneficiary. If the -Trustee is made custodian of any life insurance policy, the Trustors jointly, if community property, or individually, if separate property, may withdraw such policy or policies from the Trustee's custody upon presenting to the Trustee a demand in writing and a prcper receipt therefor. Only an owner - noninsured Trustor shall have the power to withdraw a policy of insurance from Trustee's custody on the life of an insured Trustor, owned by said noninsured Trustor as his or her separate property, or have the power to revoke or amend this Declaration of Trust with respect to such a policy. Any revocation or amendment attempted by the insured Trustor as to such an insurance policy on his or her own life shall have no effect and shall be disregarded by the Trustee. Notwith- standing anything in this Trust instrument to the contrary an owner -noninsured Trustor shall retain all incidents of owner- ship with respect to any such policies transferred to the Trust Estate during the joint lifetimes of the Trustors and the insured Trustor shall have no incidents of ownership with respect to them and shall not act as Trustee of said policies. D. Distributions to Trustors During Joint Lifetimes During the joint lifetimes of the Trustors, the Trustee shall make the following payments from the Trust Estate: 1. The Trustee shall pay to Trustor-Husband and Trustor-Wife, as co -managers of the Trustors' community property, or apply for the benefit of the Trustors, all of the net income of the community estate, if any, in quarter -annual or more frequent installments, unless the Trustee is otherwise directed in writing by the Trustors, and so much of the princi- pal thereof as the Trustors shall from time to time request in writing. Any income derived from the separate property of either Trustor shall be paid only to that Trustor. Trustors shall have the same duty to use community income and principal received under this instrument for the benefit of the Trustors as they have with respect to any other community property. 2. If at any time either Trustor shall be declared incompetent by a court of competent jurisdiction, or declared unable to administer in a proper manner any payment otherwise ART. I, p. 3 9 due that Trustor, or should in the judgment of the Trustee be physically or mentally unable to act on his or her own behalf based on the written medical opinion of the incapacitated Trustor's physician, the preceding paragraph shall be modified so that the Trustee, in the Trustee's absolute discretion, may apply for the benefit of the incapacitated Trustor, or of the other Trustor, such amounts from the income and principal of the Trust Estate, up to the whole thereof, first from community property asssets, and then from the incapacitated Trustor's separate property, as the Trustee may from time to time deem necessary or advisable for the proper health, support, and maintenance of both Trustors in accordance with their accustomed manner of living at the date of this instrument, until the incapacitated Trustor, either in the Trustee's discretion, or as certified by such Trustor's physician, is again able to manage his or her own affairs, or until the earlier death of either Trustor. The non -incapacitated Trustor may also withdraw from time to time accumulated Trust income or principal of community property. Income and principal from community property so paid shall be held and administered as community property by both Trustors. Any income not distributed under either Section 1 or Section 2 of this Paragraph D during the Trustors' joint lifetimes, shall be accumulated and added to principal of the community or the separate estate, as the case may be. In making the determination as to whether a Trustor is able to administer any payments from the Trust Estate in a proper manner, the Trustee shall consult with the Trustors, with the Trustors' children, and with the physician or physicians attending the incapacitated Trustor. The Trustee may conclusively rely on the written medical opinion of the incapacitated Trustor's physician as to a Trustor's physicial or mental incapacity. 3. The Trustors acting jointly may at any time direct the Trustee in writing to pay single sums or periodic payments out of the community estate to any person or organiz- ation. Either Trustor acting individually may at any time direct the Trustee in writing to pay single sums or periodic payments out of that Trustor s separate property estate to any person or organization. ART. I, p • A R T I C L E II SURVIVOR'S ELECTION OR PARTIAL REVOCATION A. Method of Electing or Revoking Upon the death of either Trustor, the surviving Trustor shall have a right of election to claim all of his or her separate property, if any, and all of his or her share of the community and quasi -community property of the Trustors, if any, then held in trust, by filing with the Trustee within six (6) months after the date of death of the deceased Trustor an instrument in writing revoking the Trust as to all of such property and making such claim. Upon receipt of such instrument of partial revocation and upon indemnification of the Trustee to its satisfaction and payment of all sums due it as to such property, the Trustee shall convey and transfer all such property to the surviving Trustor, free of trust. B. Effect of Action of Surviving Trustor Upon the filing of such instrument of partial revoca- tion, or upon the election of the surviving Trustor to take the rights given to the surviving Trustor by the law effecting his or her separate property, or his or her community property or quasi -community property, in the proceeds of any life insurance policies or any retirement benefit plans payable to the Trustee, or upon the surviving Trustor's election to take against the deceased Trustor's Will the remaining provisions hereof, includ- ing the provisions for final termination of the Trust, shall be carried into effect and the remainder of the Trust Estate shall be held, administered and distributed by the Trustee in the same manner as though no such election had been made by the surviving Trustor. C. Effect of No Election or Partial Revocation The Trustee may continue to administer the entire - Trust Estate until the Trustee receives written notice from the surviving Trustor, or from his or her representative, claiming rights inconsistent with the terms of the Trust. Any act of the Trustee in accordance with the provisions of this instrument, until actual receipt of such notice, shall not impair the rights of the surviving Trustor against any other person, but such acts shall not cause the Trustee to incur a liability to the surviv- ing Trustor, or to his or her successor in interest. If no such instrument of partial revocation is filed with the Trustee within six (6) months after the date of death of the deceased Trustor, and no such election to take the survivor's separate property, or his or her community property ART. II, P. 1 rI A R T I C L E I RIGHTS RESERVED BY TRUSTORS The Trustors specifically reserve the following rights: A. Revocation or Amendment During the joint lifetimes of Trustor-Husband and Trustor-Wife, this Declaration of Trust may be revoked in whole or in part with respect to community property by an instrument in writing signed by either Trustor-Husband or by Trustor-Wife and delivered by certified mail to the Trustee and the other Trustor-Spouse, and with respect to separate property by an instrument in writing signed by the Trustor-Spouse who contributed that property to the Trust -Estate, delivered by certified mail to the Trustee. On revocation, the Trustee shall promptly deliver to the Trustors jointly all or the designated portion of any community property of Trustor-Husband and Trustor-Wife, and which shall be held and managed by the Trustors as community property. With respect to separate property, upon a revocation, the Trustee shall promptly deliver to the contributing Trustor-Spouse all or the designated por- tion of that property. Prior to delivery of any property to Trustor-Husband or Trustor-Wife, the Trustee shall be indemnified to its satisfaction, and payment shall be made of all sums due the Trustee. Any such revocation shall be effective upon filing of the written notice with the Trustee and, if the death of the insured Trustor should occur before a change of beneficiary of any of the insurance policies or retirement plans becomes effective with the company or the Trustee of any such plan, any proceeds of such insurance or retirement plans received by the Trustee may be paid by it to the surviving Trustor-if the rty, and if not, to policy were the survivor's separate prope the personal representative of the deceased Trustor, and the receipt of such personal representative shall be a full and complete acquittance and discharge from liability of the Trustee. Trustor-Husband and Trustor-Wife may at any time during their joint lifetimes amend any of the terms of this Declaration of Trust by an instrument in writing signed by both of them and delivered by certified mail to the Trustee. No amendment shall be effective unless accepted by the Trustee in writing. On the death of either Trustor, this Declaration of Trust shall become irrevocable and not subject to amendment to the extent of the decedent's separate property, if any, or to ART. I, p- 1 the extent of the decedent's community property share of the proceeds of the insurance policies or death benefits or other community property assets transferred to Trust A, as herein- after described. However, while living and competent, the surviving Trustor shall have an election as set forth in Article II, and shall have whatever rights of withdrawal or appointment over Trust B, as hereinafter described, to the degree allowable under the provisions of Article VI. During the lifetime of both Trustors, any co -Trustee may be removed as a Trustee upon written notice to all Trustees signed by both Trustors. No successor Trustee need be named upon such removal. B. Power Reserved in Life Insurance Policies The Trustors reserve, during their joint lifetimes, all of the rights and powers granted in any of the community property or separate property life insurance policies or retirement benefit plans (to be exercised by them jointly if community, or by the owner if separate, without the consent or participation of the Trustee or any beneficiary of this Declaration of Trust) including the following: 1. To receive or apply dividends, distributive shares or surplus, disability benefits, premium refunds, proceeds of matured policies, loan, surrender or commuted values, or any other sum due under any such policies or plans. 2. To obtain and receive such advantages or loans as may be available under any such policies or plans. 3. To exercise any options or privileges granted in any such policies or plans, provided that Tru_stors shall not, without the consent of the Trustee, exercise any option whereby the proceeds of any such insurance policies would be payable to the Trustee other than in one lump sum. 4. To sell, assign, or pledge any such policies or Trustors' interest in any such plans. 5. To change the beneficiaries of any such policies or plans, provided that any change of beneficiary having the effect of making the proceeds of any such policies or plans payable to any beneficiary other than the Trustee, shall, upon becoming effective with the issuing company or the Trustee of such plan, revoke the Declaration of Trust as to such policies or plans. ART. I, p. 2 6. To withdraw and cancel or surrender any such policies or documents evidencing the interest in any such plans. C. Possession of Life Insurance Policies During the life of the insured, Trustors may remain in possession of any life insurance policy or policies under which the Trustee has been named beneficiary. If the Trustee is made custodian of any life insurance policy, the Trustors jointly, if community property, or individually, if separate property, may withdraw such policy or policies from the Trustee's custody upon presenting to the Trustee a demand in writing and a proper receipt therefor. Only an owner - noninsured Trustor shall have the power to withdraw a policy.of insurance from Trustee's custody on the life of an insured Trustor, owned by said noninsured Trustor as his or her separate property, or have the power to revoke or amend this Declaration of Trust with respect to such a policy. Any revocation or amendment attempted by the insured Trustor as to such an insurance policy on his or her own life shall have no effect and shall be disregarded by the Trustee. Notwith- standing anything in this Trust instrument to the contrary an owner -noninsured Trustor shall retain all incidents of owner- ship with respect to any such policies transferred to the Trust Estate during the joint lifetimes of the Trustors and the insured Trustor shall have no incidents of ownership with respect to•them and shall not act as Trustee of said policies. D. Distributions to Trustors During Joint Lifetimes During the joint lifetimes of the Trustors, the Trustee shall make the following payments from the Trust Estate: 1. The Trustee shall pay to Trustor-Husband and Trustor-Wife, as co -managers of the Trustors' community property, or apply for the benefit of the Trustors, all of the net income of the community estate, -if any, in quarter -annual or more frequent installments, unless the Trustee is otherwise directed in writing by the Trustors, and so much of the princi- pal thereof as the Trustors shall from time to time recuest in writing. Any income derived from the separate property of either Trustor shall be paid only to that Trustor. Trustors shall have the same duty to use community income and principal received under this instrument for the benefit of the Trustors as they have with respect to any other community property. 2. If at any time either Trustor shall be declared incompetent by a court of competent jurisdiction, or declared unable to administer in a proper manner any payment otherwise ART. I, p. 3 due that Trustor, or should in the judgment of the Trustee be physically or mentally unable to act on his or her own behalf based on the written medical opinion of the incapacitated Trustor's physician, the preceding paragraph shall be modified so that the Trustee, in the Trustee's absolute discretion, may apply for the benefit of the incapacitated Trustor, or of the other Trustor, such amounts from the income and principal of the Trust Estate, up to the whole thereof, first from community property asssets, and then from the incapacitated Trustor's separate property, as the Trustee may from time to time deem necessary or advisable for the proper health, support, and maintenance of both Trustors in accordance with their accustomed manner of living at the date of this instrument, until the incapacitated Trustor, either in the Trustee's discretion, or as certified by such Trustor's physician, is again able to manage his or her own affairs, or until the earlier death of either Trustor. The non -incapacitated Trustor may also withdraw from time to time accumulated Trust income or principal of cor-iunity property. Income and principal from community property so paid shall be held and administered as community property by both Trustors. Any income not distributed under either Section 1 or Section 2 of this Paragraph D during the Trustors' joint lifetimes, shall be accumulated and added to principal of the community or the separate estate, as the case may be. In making the determination as to whether a Trustor is able to administer any payments from the Trust Estate in a proper manner, the Trustee shall consult with the Trustors, with the Trustors' children, and with the physician or physicians attending the incapacitated Trustor. The Trustee may conclusively rely on the written medical opinion of the incapacitated Trustor's physician as to a Trustor's physicial or mental incapacity. 3. The Trustors acting jointly may at any time direct the Trustee in writing to pay single sums or periodic payments out of the community estate to any person or organiz- ation. Either Trustor acting individually may at any time direct the Trustee in writing to pay single sums or periodic payments out of that Trustor s separate property estate to any person or organization. ART. I, p. 4 0 A R T I C L E II SURVIVOR'S ELECTION OR PARTIAL REVOCATION A. Method of Electing or Revoking Upon the death of either Trustor, the surviving Trustor shall have a right of election to claim all of his or her separate property, if any, and all of his or her share of the community and quasi -community property of the Trustors, if any, then held in trust, by filing with the Trustee within six (6) months after the date of death of the deceased Trustor an instrument in writing revoking the Trust as to all of such property and making such claim. Upon receipt of such instrument of partial revocation and upon indemnification of the Trustee to its satisfaction and payment of all sums due it as to such property, the Trustee shall convey and transfer all such property to the surviving Trustor, free of trust. B. Effect of Action of Surviving Trustor Upon the filing of such instrument of partial revoca- tion, or upon the election of the surviving Trustor to take the rights given to the surviving Trustor by the law effecting his or her separate property, or his or her community property or quasi -community property, in the proceeds of any life insurance policies or any retirement benefit plans payable to. the Trustee, or upon the surviving Trustor's election to take against the deceased Trustor's Will the remaining provisions hereof, includ- ing the provisions for final termination of the Trust, shall be carried into effect and the remainder of the Trust Estate shall be held, administered and distributed by the Trustee in the same manner as though no such election had been made by the surviving Trustor. C. Effect of No Election or Partial Revocation The Trustee may continue to administer the entire Trust Estate until the Trustee receives written notice from the surviving Trustor, or from his or her representative, claiming rights inconsistent with the terms of the Trust. Any act of the Trustee in accordance with the provisions of this instrument, until actual receipt of such notice, shall not impair the rights of the surviving Trustor against any other person, but such acts shall not cause the Trustee to incur a liability to the surviv- ing Trustor, or to his or her successor in interest. If no such instrument of partial revocation is filed with the Trustee within six (6) months after the date of death of the deceased Trustor, and no such election to take the survivor's separate property, or his or her community property ART. II, p. 1 or quasi -community property interest, in such life insurance proceeds or such retirement benefit plans, or to take against the Will of Trustor, is made, this Trust shall become irrevocable and not subject to amendment, although the surviving Trustor shall retain any rights of withdrawal of principal or powers of appointment given to the surviving Trustor under the provisions of Article V or VI. ART. II, p. 2 A R T I C L E III DUTIES OF TRUSTEES AS TO INSURANCE POLICIES A. Safekeeping of Policies and Payment of Premium If, during the life of the insured, the Trustee shall hold any insurance policies or any documents relating to any retirement plan, such holding shall be subject to the writ- ten order of the Trustors (based on the provisions of Paragraphs A through C of ARTICLE I), and the Trustee shall be without obligation during the insured's lifetime other than the safe custody of such policies or documents as may be delivered to the Trustee. The Trustee shall be under no duty to -pay premiums, assessments, or any other charges upon any life insurance policy or retirement benefit plan of which the Trust is owner or beneficiary, to keep informed with respect to such payment of premiums, assessments, or other charges, or to take any other action to keep such policies or plans in force where the Trust is revocable by a Trustor. B. Collection of Proceeds of Policies Upon receipt by the Trustee of actual notice of the death of the insured, and upon obtaining possession of an insur- ance policy on the life of the insured, the Trustee shall make reasonable efforts to file a claim or claims for and collect the proceeds of any policy or policies or retirement benefit plans in force and payable to the Trustee as beneficiary, or the value of any lapsed policies included in the Trust Estate, and by appropriate proceedings may institute suits and actions to enforce payment of the proceeds of any such policies or the interests in any such plans, and may do and -perform any and all other acts deemed necessary for the purpose of collecting any sums which may be deemed due and payable under the terms of such policies or plans, provided, however that the Trustee shall be under no duty to enter into or maintain any litigation to enforce the payment of any sums deemed due under such policies or plans until the Trustee shall have been indemnified to the Trustee's satisfaction against all expenses, including attor- ney s fees and liabilities to which, in the Trustee's judgment, the Trustee may be subjected by such actions. The Trustee is authorized to compromise and adjust any claims arising out of any such policies or plans upon terms and conditions which the Trustee deems satisfactory, and the decision of the Trust ee shall be conclusive and binding upon all beneficiaries, persons and entities interested herein. The Trustee shall be under no duty to seek reim- bursment from any source for any deduction from or charge against the proceeds of any such policy or plan on account of ART. III, p. 1 any loan, advance or indebtedness, by an issuing company or by a trustee of any retirement benefit plan or by any other lender to whom the policy or the interest in such plan may have assigned as collateral. C. Liability of Insurance Company The Trustors hereby authorize each insurance company and each trustee of any retirement benefit plan to pay to the Trustee any death benefits or the funds under such policies or plans subject to the terms of this Declaration of Trust. Each Trustor waives any claim that he or she might have against such insurance company or trustee, and reserves, against the Trustee alone, the right to claim and demand payment and delivery to said survivor Trustor of his or her community interest in such death benefits or other funds. No insurance company and no trustee of any retire- ment plan shall be under any duty to see to the performance of the terms of this Declaration of Trust or to see the application of such benefits or other funds paid to the Trustee, and the re- ceipt of the Trustee for any such payment shall be a full and complete acquittance to the company or the trustee of any such plan making such payment. D. Insurance_ on Surviving Trustor -- The Trustee is authorized to continue to hold as part of the Trust Estate of TRUST A, established under ARTICLE IV, all insurance policies on the life of the surviving Trustor, which are to be distributed or allocated to the Trustee as part of TRUST A. In the event the surviving Trustor is a Trustee of TRUST A, the following named person shall act as Special Trus- tee, and shall hold all powers conferred on the owner of' any policy. If said first named Special Trustee shall be unable or unwilling to exercise the powers conferred on the owner of any such policy as provided in this paragraph, the second named person shall exercise those powers, or nominate a successor Special Trustee. The Special Trustee shall hold the powers in trust and shall designate TRUST A as beneficiary of any such policies. In the event the surviving Trustor is a Co -Trustee of TRUST A, said surviving Trustor shall have no rights, interests, or powers over such life insurance policies, and all incidents of ownership shall be exercised by the Co -Trustee. While the surviving Trustor shall act as Trustee under this instrument, he or she shall execute any documents necessary or appropriate, and sonableke such request madeavailable thesSpecialimplement Trustee onactions rea- sonable any insurance company. The Trustee shall charge all premiums on ART. III, p. 2 0 • policies that the Special Trustee shall elect to continue in force from time to time against the principal of TRUST A. The responsibilities of the Special Trustee shall be limited to the exercise of powers under this paragraph, and said Special Trustee shall not be concerned with any other aspect of trust administration. The Special Trustees, in order of appointment, shall be as follows: JOSEPH T.•THOMPSON 2. MONIQUE GRETCHEN BACK 3. JOSEPH WILLIAM BACK ART. III, p. 3 A R T I CLE IV DIVISION OF TRUST ESTATE AND PAYMENT OF EXPENSES A. Paymentof Ex erases of Trust Administration, Funeral and Last Illness Taxes, and Debts Upon the death of either trustor, the Trustee may pay, in the Trustees's discretion, or reserve sufficient funds to pay, all expenses of management and administration of the Trust Estate for the following year, including compensation of the Trustee, if any, all of or any part of which may, in the discretion of the Trustee, be charged either to income or te, to the extent allowed hereafter. principal of the Trust Esta In addition, the Trustee, in the Trustee's discretion, may pay the expenses of the deceased Trustor's last illness and funeral, and any estate, inheritance, or other death taxes, together with interest, penalties, costs, Trustee's compensa- tion and attorney's fees, whether attributable to property subject to probate administration or to properties included in the Trust Estate or to outside transfers, and debts of the deceased Trustor, from either income or principal of the deceased Trustor's share of the community property, or the deceased Trustor's separate property to the extent the Trustee determines such expenses are not reasonably provided for by the probate estate of the deceased Trustor or by the surviving spouse of the deceased Trustor. The remaining income after payment of such expenses shall be and is hereinafter referred to as Itnet income". Any payments for estate or inheritance taxes shall be charged to Trust A without apportionment or charge against any beneficiary of the Trust Estate or any transferee of property passing outside the Trust Estate. Payments for last illness, funeral., and other f erhadministration costs shall be charged to Trust A, provided, , that administration costs allocable to Trusts B and C shall be charged to Trusts B and C respectively. Notwithstanding anything in this instrument to the contrary, the Trustee shall not pay any death taxes, including interest or penalties, last illness and funeral expenses, attorney's fees, administration expenses, debts, or other obligations of the deceased Trustor or of the deceased Trustor's estate from funds received from qualified retirement plans that are excludable from the deceased Trustor's gross of estate for federal estate tax purposes under Section 20f m the the Internal Revenue Code or any successor statute, or from proceeds of insurance policies on the deceased Trustor's life. However, to the extent there are no other assets available for such purposes, or to the extent the trust includes insurance proceeds in excess of the amount of the insurance exemption ART. IV, p. 1 available under the California Revenue and Taxation Code, the Trustee, in its discretion, may use insurance proceeds that are otherwise taxable in the deceased Trustor's estate for federal estate tax purposes for such payments. B. Division of the Trust Estate Following the death of either Trustor, the Trustee shall divide the Trust Estate, including any additions made to the Trust by reason of the death of a Trustor, such as from the deceased Trustor's Will or from life insurance policies, into three separateed as ,THE J. TRUST",and"THELLIAM K GRETCHEN AND JOSEPH BACK TRUST". The trust named after the decedent shall hereinafter be referred to as "TRUST C", the trust named after the surviv- ing Trustor shall hereinafter be referred to as "TRUST B", and the trust for the benefit of Trustors' child or children shall hereinafter be referred to as "TRUST A". 1. TRUST A shall consist of a pecuniary amount equal to the maximum sum that can be allocated to the trust that does not qualify for the federal estate tax marital \ i deduction, wig t pcing any federal estate tax by reason of the death of the first Trustor, that is, by virtue of the unified credit, after taking into account: (a) All available deductions taken in determining the estate tax payable by reason of said Trustor's death; (b) All credits allowed for federal estate tax purposes; and (c) The net value of all other property included in said Trustor's gross estate which passes or has passed under this Will or otherwise to any other person, trust, or entity, and which does not qualify for the federal estate tax marital bequest, final ofederal uestate rpose otax evalues lshall ng econtrol, amount ohis and account shall not be taken of any credit to the extent it would cause the marital deduction to be wholly or partially dis- allowed or of any item not deductible for estate tax purposes because claimed for income tax purposes; but all tranfers by Will or otherwise for which the marital deduction would have been allowed but for disclaimer by the surviving Trustor or nonelection by the personal representative of the deceased Trustor shall be treated for this purpose as if that deduction had been allowed.) ART. IV, p. 2 The Trustee shall satisfy the pecuniary amount so determined in cash or in kind, or partly in each. Assets allocated in kind shall be deemed to satisfy this amount on the basis of their net fair market values at the date or dates of distribution or allocation to TRUST A. 2. TRUST B shall consist of the surviving Trustor's separate property, if any, including proceeds of policies of life insurance owned by the surviving Trustor on the life of the deceased Trustor, and the surviving Trustor s interest in ^ the community property assets of the Trustor s. Provided, however, that the Trustee shall allocate to TRUST B any assets—_ or other property that do not qualify as "qualified terminable interest property" as defined under the marital deduction ` provisions of the Internal Revenue Code. 3. TRUST C shall consist of all property which is not allocated to TRUST A or TRUST B in accordance with the above paragraphs. The Trustors intend that this portion con- tain "Qualified Terminable Interest Property as defined by Section 2056 of the Internal Revenue Code. The Trustee (if there is no court appointed personal representative) is speci- fically empowered with the right to make the election provided in Section 2056(b)(7)(v) of the Internal Revenue Code as amended. Under circumstances existing at the death of the first Trustor, such an election may have beneficial tax results to that Trustor's estate and beneficiaries. The Trustee is directed herein to employ tax counsel as soon as possible after the death of the first Trustor for the purpose of rendering a written report to my beneficiaries of the results of exercising the Marital Deduction election herein. The Trustee shall satisfy the assets to be dis- tributed to any trust herein in cash or in kind or partly in each, and assets allocated in kind shall be deemed to satisfy this amount on the basis of their fair market values at the date or dates of distribution to such Trusts. The Trustee is authorized to allocate property to TRUSTS A, B, and C prior to the final determination of federal estate taxes,, with alloca- tion being made upon such information as is then available to the Trustee. The Trustee may thereafter from time to time ad- just properties between TRUSTS A, B, and C when and if it is determined that the allocation should have been made differ- ently. The division of the trust assets into TRUSTS A, B, and C shall be made as soon after the death of the first Trustor as is practicable, and the surviving Trustor shall have the power, by written instrument filed with the Trustee, to renounce or disclaim all or any part of the decedent's estate to be added to TRUST A or TRUST C. Any assets or interests so ART. Iv, p. 3 disclaimed from TRUST C shall be allocated to TRUST A and shall be held and administered as provided herein, either for the benefit of the surviving Trustor (or for the successor benefi- ciaries if the surviving Trustor also disclaims his or her interests in TRUST A). C. Simultaneous Death If the surviving spouse does not survive the deceased spouse for one hundred eighty (180) days, TRUST A shall consist of one-half Q) of said separate property owned by the deceased spouse included in the trust estate, plus the deceased spouse's share of the community property, and TRUST B shall consist of one-half (Z) of the separate property of the deceased spouse, plus the surviving spouse's share of the community property. D. Intention of Trustor to Obtain Marital Deduction It is the Trustor's intention to have TRUST B qualify for the marital deduction under Section 2056 of the Internal Revenue Code and the Regulations pertaining to that section, or any corresponding or substitute provisions applicable to the Trust Estate. In no event shall the Trustee take any action or have any power that will impair the marital deduction, and all provisions regarding TRUST B shall be interpreted to conform to this primary objective. During the lifetime of the surviving Trustor, the surviving Trustor shall have the power to require the Trustee to make all or part of the principal of TRUST B productive or to convert promptly any unproductive part to productive property. This power shall be exercised by the surviving Trustor in a written instrument delivered to the Trustee. E. Allocation of Treasury Bonds and Life Insurance on Life of Surviving Trustor Notwithstanding the provisions of Paragraph B of this ARTICLE IV, any obligations of the United States of America that are redeemable at par in payment of any federal estate tax liability of the deceased Trustor shall be allocated by the Trustee to TRUST A to the extent necessary to satisfy the amount to be transferred to TRUST A, but not in an amount exceeding the federal estate tax. In addition, if the surviving Trustor is the insured under any life insurance policies of which the Trustee is designated as beneficiary, and the deceased Trustor was at the time of his or her death the owner of all or any portion of any such policy, which ownership interest or any portion thereof constitutes part of the Trust Estate and has passed to the Trustee hereunder, the Trustee may ART. IV, p. 4 allocate any such policy or portion thereof to TRUST A to the extent necessary to satisfy the amount to be transferred to TRUST A (computed after the transfer of any Treasury Bonds as mentioned above). The trustee may effect such transfer of a portion of any such policy to TRUST A by converting the subject life insurance policy into two policies of values in the same proportion as necessary to distribute to TRUST A and to TRUST B (or otherwise) respectively, making each trust the beneficiary of the respective policies. ART. IV, p. 5 A R T I C L E V DISTRIBUTION OF INCOME AND PRINCIPAL OF TRUST "A" and "C" A. TRUST A -- Distribution of Net Income in Discretion The Trustee shall distribute to or apply for the benefit of the surviving Trustor or of Trustors' issue as much of the net income and principal of Trust A as the Trustee in the Trustee's discretion deems necessary for their reasonable support, care, and maintenance. Any income not distributed shall be accumulated and added to principal. In making any payment of benefits to or for the suriving spouse under this subparagraph, the Trustee shall take into consideration any income or other resources of the surviving spouse outside this trust, known to the Trustee. B. TRUST A -- Death of Second Trustor - Divide in Upon the death of the second Trustor, Trust A shall be divided into as many equal shares as there are children of the Trustor then living, and children of the Trustor then deceased leaving issue then living. The Trustee shall allocate one (1) such equal share to each living child of the Trustor, and one (1) such equal share to each group comprised of the living issue of a deceased child of the Trustors. Each such share shall be distributed or retained in trust, as provided herein. 1. Each share allocated to a living child of the Trustors shall be held by the Trustee and distributed as follows: (a) The Trustee shall distribute as much of the income and principal of the child's trust for the proper sup- port, care, maintenance and eduction of the child as the Trustee in the Trustee's discretion deems necessary. Any income not distributed shall be accumulated and added to principal. (b) When the child attains age twenty-five (25), the entire net income from the child's trust shall be distribu- ted in monthly or such other installments as may be convenient, but not less frequently than annually, to or for the use and benefit of child during his or her lifetime. When the child attains age thirty (30), the Trustee shall distribute to the child one-third (1/3) of the principal of the child's trust as then constituted. When the child attains age thirty-five (35), ART. V, p. 1 the Trustee shall distribute the balance of the child's trust. (c) If any child of the Trustors dies prior to the termination of the child's trust, the child's trust shall be retained in trust, in accordance with the provisions of Subparagraph B-2 of this ARTICLE V, if a child of said deceased child is then living who is under age twenty-one (21). If no child of the deceased child is living who is under age twenty- one (21), the balance shall thereupon be distributed, free of trust, to the deceased child's issue then living, by right of representation or, if there are none, to the then living issue of the Trustors by right of representation; provided, however, that if any part of that balance would otherwise be distributed to a person for whose benefit a trust is then being adminis- tered under this trust, that part shall instead be added to that trust and shall thereafter be administered according to its terms, except that any addition to a partially distributed Trust shall augment proportionately the distributed and undis- tributed portions of the trust. 2 Each share allocated to a group comprised of the living issue of a deceased child of the Trustors shall be distributed, free of trust, to the issue then living of said deceased child, by right of representation, if at the time the Trust Estate is divided into separate shares, no child of said deceased child of the Trustors is living who is under age twenty-one (21). If a child of said deceased child of the Trustors is then living who is under age twenty-one (21), the share shall be retained by the Trustee as a separate trust for the benefit of the deceased child's living issue as a group, including those age twenty-one (21) or older. From each separate Trust, the Trustee shall pay to or apply for the benefit of the issue, of whatever degree, living at the time, including those whose -ancestor or ancestors are still living, as much of the net income and principal of the trust as the Trustee, in the Trustee's discretion, shall from time to time deem necessary for their proper support, care, maintenance and education. Any net income not distributed shall be accumulated and added to principal. In exercising the discretion granted by this subparagraph, the Trustee may pay more to or apply more for some beneficiaries than others, and may make payments to or applications of benefits for one or more beneficiaries to the exclusion of others. Any payment or ap- plication of benefits pursuant to this subparagraph shall be charged against the trust as a whole rather than against the ultimate distributive share of the beneficiary to whom or for whose benefit the payment is made. The trust shall terminate as soon as no child of said deceased child of the Trustors is living who is under age ART. V, p- 2 on twety-one distributedtermination, free ofthe trust, togthebalance of then living issue of said deceased child of the Trustors, by right of representation, or if there are none, to the Trustors' issue by right of representation; provided, however,*that if a part of that balance would otherwise be distributed to a person whose benefit a trust is then being administered under this Declaration of Trust, that part shall instead be added to that trust and shall thereafter be administered according to its terms. C. Distribution of Income -- TRUST C The entire net income from TRUST C shall be distri- buted in monthly or such other installments as may be conven- ient, but not less frequently than annually, to or for the use and benefit of the surviving Trustor during his or her life- time. Any income not distributed at the time of the surviving Trustor's death shall be distributed to his or her personal representative. Upon the death of the second Trustor, TRUST C shall be added to TRUST A, to follow the disposition of such trust in all respects as provided in this ARTICLE V, but the Trustee, in that event, may, in the Trustee's discretion, first pay out of the principal of TRUST C the last illness and funeral expenses and other obligations incurred for the support of the surviving estate or inheritance taxes attributable to Trustor, and any riving Trustor's death, unless TRUST C by reason of the sur other adequate provision shall have been made therefor. D. Ultimate Distribution If at the time of the surviving Trustor's death, or at any later time before full distribution of the Trust Estate, the Trustors and all of the Trustors' issue are deceased, and no other distribution of the property is directed by this Declaration of Trust, the Trust Estate, or the portion of it then remaining, shall be distributed as follows: 1. One -fifth (1/5) to VIOLA•BISSONNETTE or to her surviving issue on the principle of representation. 2. One -fifth (1/5) to EDOUARD GAGNE on the principle of representation. 3. One -fifth (1/5) to OVILA GAGNE, if he is then living, and if not, this gift shall lapse and augment propor- tionately the gifts made to the other beneficiary named in this Paragraph D. ART. V, p. 3 4. One -tenth (1/10) to MARIA FAFORD, or to her sur- viving issue on the principle of representation. 5. One -fifth (1/5) to LEO GAGNE, or to his surviving issue on the principle of representation. 6. One -fiftieth (1/50) to MARY LEONARD, who has been our faithful cook and housekeeper -for many years, if she is then living, and if not, this gift shall lapse and augment proportionately the gifts made to the other beneficiaries named in this Paragraph D. 7. One -fiftieth (1/50) to ST. MICHAEL'S SEMINARY in Orange, California. 8. One -fiftieth (1/50) to IJARYMOUNT HIGH SCHOOL in Los Angeles, California. 9. One -twenty-fifth (1/25) to CATHEDRAL CHAPEL CHURCH, to be exclusively used in its school. ART. V, p. 4 ARTICLE VI DISTRIBUTION OF INCOME AND PRINCIPAL OF TRUST "B" A. Distribution of Net Income to Surviving Trustor The entire net income from TRUST B shall be distribu- ted in monthly or such other installments as may be convenient, but not less frequently than annually, to or for the use and benefit of the surviving Trustor during his or her lifetime. Any income not distributed at the time of the surviving Trus- tor's death shall be distributed to his or her personal repre- sentative B. Pcwer of Withdrawal -- $50,000 or 10% In addition to any other payment that the surviving Trustor may receive from TRUST B, the Trustee shall pay to the surviving Trustor out of the principal of TRUST B such amounts as the surviving Trustor may from time to time request in writing, not exceeding in any calendar year the greater of the following amounts: Fifty Thousand Dollars ($50,000) or ten percent (10%) of the value of the principal of TRUST B, deter- mined as of the end of the previous fiscal year. The Trustee shall comply with such written request of the surviving Trustor, within the limits set forth, and shall have no responsibility to inquire into or determine for what purpose such withdrawal is made by the surviving Trustor. C. Death of Second Trustor -- Add to TRUST A TRUST B shall terminate on the death of the surviv- ing Trustor, and shall be added to TRUST A, to follow the dispo- sition of such trust in all respects as provided in ARTICLE V; but the Trustee, in that event, may, in the Trustee's discre- tion, first pay out of the principal of TRUST B not so appointed by said Trustor the last illness and funeral expenses and other obligations incurred for the support of the surviving Trustor, and any estate or inheritance taxes attributable to TRUST B by reason of the surviving Trustor's death, unless other adequate provision shall have been made therefor. ART. VI, p- 1 ARTI CLE VII TRUSTEE, SUCCESSORt AND COMPENSATION A. Trust Administration Delegation• Power to Act Either Trustor, as Trustee, may sign checks or make withdrawals from trust commercial or savings accounts without obtaining the signature of any co -Trustee. Further, either Trustor alone, as a Trustee, or any other two (2) Trustees, other than a Trustor, may execute documents, enter into agreements, and otherwise act as a Trustee herein, without requiring the joint action of all of the other Trustees. Anyone may rely upon the declaration.of a Trustor, acting as a TrusteeTrustor,orrthe yTrustees other ware 2acting tonsbehalf hofethe ct that a trust. So long as any individual named herein shall act as a co -Trustee of these trusts, each individual shall have the power from time to time to delegate to any other co -Trustee all or any of his powers as co -Trustee during temporary vacations or other temporary absences from the State of California. The power of delegation shall be exercised by delivery by the individual co -Trustee to every other co -Trustee of written notice specifying the powers to be delegated; such delegation shall terminate upon delivery by the individual co -Trustee to every other co -Trustee of written notice of termination. The individual co -Trustee, having delegated such powers shall incur no liability to any beneficiary of the Trust Estate with respect to the administration of the Trust Estate related to such delegations of powers during the period of such delegation. If the individual Trustee is unable to participate in trust activities because -of illness, disability or any -other reason, the remaining co -Trustee or co -Trustees may, during any such incapacity, make any and all decisions regarding the Trust Estate as though the remaining co -Trustee or co -Trustees was the sole Trustee hereunder. In determining the disability of the individual Trustee, the remaining co -Trustee or co -Trustees may rely on a certificate or other written statement from a physician who has examined the individual Trustee. In the absence thereof, the remaining co -Trustee or co -Trustees shall petition the court having jurisdiction of this trust for authority to proceed as though the incapacitated Trustee was deceased. In the event of the disability of one Trustor, the remaining Trustor, acting as a Trustee herein, shall obtain an order of a court of competent jurisdiction for any sale or other disposition of community property realty pursuant to the provisions of California Probate Code Section 3000 et seq., as now enacted or hereinafter amended. ART. VII, p. 1 ARTICLE VII TRUSTEE, SUCCESSOR AND COMPENSATION A. Trust Administration; Delegation; Power to Act Either Trustor, as Trustee, may sign checks or make withdrawals from trust commercial or savings accounts without obtaining the signature of any co -Trustee. Further, either Trustor alone, as a Trustee, or any other two (2) Trustees, other than a Trustor, may execute documents, enter into agreements, and otherwise act as a Trustee he without requiring the joint action of all of the other Trustees. Anyone may rely upon the declaration of a Trustor, acting as a Trustor orrthe vTrustees ware 2acting tonsbehalf hofethe ct that a trust. So long as any individual named herein shall act as a co -Trustee of these trusts, each individual shall have the power from time to time to delegate to any other co -Trustee all or any of his powers as co -Trustee during temporary vacations or other temporary absences from the State of California. The power of delegation shall be exercised by delivery by the individual co -Trustee to every other co -Trustee of written notice specifying the powers to be delegated; such delegation shall terminate upon delivery by the individual co -Trustee to every other co -Trustee of written notice of termination. The individual co -Trustee, having delegated such powers shall incur no liability to any beneficiary of the Trust Estate with respect to the administration of the Trust Estate related to such delegations of powers during the period of such delegation. If the individual Trustee is unable to participate in trust activities because of illness, disability or any other reason, the remaining co -Trustee or co -Trustees may, during any such incapacity, make any and all decisions regarding the Trust Estate as though the remaining co -Trustee or co -Trustees was the sole Trustee hereunder. In determining the disability of the individual Trustee, the remaining co -Trustee or co -Trustees may rely on a certificate or other written statement from a physician who has examined the individual Trustee. In the absence thereof, the remaining co -Trustee or co -Trustees shall petition the court having jurisdiction of this trust for authority to proceed as though the incapacitated Trustee was deceased. In the event of the disability of one Trustor, the remaining Trustor, acting as a Trustee herein, shall obtain an order of a court of competent jurisdiction for any sale or other disposition of community property realty pursuant to the provisions of California Probate Code Section 3000 et seq., as now enacted or hereinafter amended. ART. VII, p. 1 If, after consultation with each other, the Trustees shall be unable to agree regarding any matter affecting the administration or distribution of the Trust Estate, the decision of the Trustors, or the survivor, acting as Trustee, shall govern. If there is no Trustor acting as Trustee, any action taken by a majority of the Trustees shall be binding upon the Trust Estate. In the event there is a corporate Trustee and an individual Trustee administering any trust created herein in a joint capacity, the corporate Trustee shall act as the sole custodian of the assets of this trust, shall keep and maintain all necessary and proper records and books of account, and in F general assume the primary responsibility for the discharge o� administrative work in connection with execution of any trust herein, so that the individual Trustee may be released, so far as possible from the responsibilities of administrative procedures. The primary responsibility of the individual Trustee is to act jointly with the corporate Trustee in the exercise of the Trustee's discretion to distribute income and principal. Any individual Trustee or Trustees may, at any time, by signed instrument delivered to the corporate Trustee, delegate to it any or all powers and discretions under this Declaration of Trust, including the power to convey real property, either for a specified time or until the delegation is revoked by a similar instrument. Any person dealing in good faith with the corporate Trustee may rely without inquiry on its certification with respect to any delegation of duties therein. B. Resignation or Death of Trustee The Trustee, or any successor, may resign from any trust created herein at any time upon giving written notice thirty (30) days before such resignation shall take effect, to the Trustors, or to the survivor thereof, or after the death of both Trustors to all adult beneficiaries, and to the guardians, conservators, or other fiduciary or fiduciaries of the estates of any minor or incompetent beneficiaries who may then be receiving or entitled to receive income hereunder. The resigning Trustee may appoint a successor Trustee, whose names shall be set forth in such written notice to the remaining Trustees and to all income beneficiaries. This nomination of a successor shall be subject to the approval of the majority of the remaining Trustees. If the remaining Trustees do not approve of the named successor Trustee, then the successor Trustee shall be appointed by the beneficiaries. In addition, any Trustee may designate a successor Trustee who shall succeed the designating Trustee upon the death of said Trustee, subject to the same proval procedure above. ART. vil, p. 2 C. Substitution of Trustee The Trustors, or survivor thereof, so long as living and competent, shall have full power and authority at any time or times to remove any existing Trustee or co -Trustee herein, and to appoint as successor Trustee any individual, or a corporation authorized to accept trusts in any state of the United States, by delivering to any Trustee a written appointment of successor Trustee and the successor's written acceptance of the administration of the Trust Estate. Upon delivery of such instruments to the Trustee, the existing Trustee shall, after deducting all charges and amounts due it as Trustee, and upon receipt of such proper indemnity as it may require, transfer and deliver the Trust Estate to the successor Trustee or Trustees. D. Power of Successor Trustee The resigning Trustee, or the Executor of a deceased Trustee, shall transfer and deliver to the succeeding Trustee the then entire Trust Estate, and shall thereupon be discharged as Trustee herein, and shall have no further powers, discre- tions, rights, obligations or duties with reference to the Trust Estate. The successor Trustee shall assume all such powers, discretions, rights, obligations and duties of the resigning or deceased Trustee. No successor shall be liable for any act, omission, or default of a predecessor Trustee. Unless requested in writing within sixty (60) days of appointment by an adult beneficiary of the Trust having a present income interest, no successor Trustee shall have any duty to investigate, audit, or review any action of a predecessor Trustee showing assets on hand without further investigation and without incurring any liability to any person claiming or having an interest in the trust.. Any investigation, audit or action to obtain redress for breach of trust by a prior Trustee shall be an expense of the Trust Estate rather than of any beneficiary requesting such successor Trustee to act on behalf of the Trust. E. Compensation of Trustee Trustee shall be entitled to a reasonable fee as compensation for the Trustee's services rendered each year, or a portion of each year. Any corporate Trustee acting herein shall be entitled to receive compensation for its services under this Declaration of Trust in the amount and at the times specified in the corporate Trustee's Schedule of Fees estab- lished from time to time by its Trust Department for the admin- istration of accounts of a character similar to this one and in effect when such compensation is payable. ART. VII, p. 3 1i F. Bond of Trustee The Trustors expressly direct that any Trustee named herein, or any Trustee appointed by an existing Trustee or substituted by a Trustor, or appointed by a court of competent jurisdiction, if such appointment or substitution designates there shall be no bond, or a corporate Trustee authorized to do business in any state of the United States (and in connection therewith is required to file a bond with governmental author - ties in said state for the protection of persons beneficiary to the trust being administered by such corporate Trustee) shall not be required to give bond or security for the proper discharge of the duties of the Trustee hereunder. G. Designation of Successor Trustee by Trustors Upon the death or incapacity of either Trustor, the other Trustor shall continue to act as Trustee and shall name a co -Trustee of his or her choice. First consideration of the named co -Trustee should be given to JOSEPH T. THOMPSON, there- after to MONIQUE GRETCHEN BACK, and thereafter to JOSEPH WILLIAM BACK. The surviving spouse, while living and compe- tent, shall have a right to replace the existing co -Trustee. Upon the death or incapacity of the surviving Trustor, JOSEPH T. THOMPSON and MoNIQUE GRETCHEN BACK shall act as co -Trustees. Upon the death or incapacity of either, the other Trustee shall hae a right to name nov vsuccessor is named, JOSEPH SWILLIAMor rBACK eshall act as he event as co -Trustee herein. ART. VII, p. 4 A R T I C L E VIII POWERS AND DISCRETIONS OF TRUSTEE To carry out the purpose of any trust created under this Declaration of Trust and subject to any additions or limita- tions stated elsewhere in this instrument, the Trustee is vested with the following powers with respect to the Trust Estate and any part of it, in addition to those powers now or hereafter conferred by law, and generally, in all respects, the Trustee may hold, manage, control and administer the Trust Estate, exercise each and every right, power and privilege in connection with and in relation to the Trust Estate, as could be done, exercised and executed by an individual holding and owning said property in absolute and unconditional ownership: - A. General Powers 1. Retention of Property -- To continue to hold in the form in whic receive (or the form to which changed by reorganization, split-up, stock dividend, or other like occurrence) any properties at any time acquired by the Trustee during the existence of any trust created herein, whether or not of the character permitted by law for the investment of trust funds, including stock of a corporate Trustee, and any residential property as long as the Trustors or their issue continue to occupy it or rent it to the advantage of the Trust Estate, and'including interests in any going business or enterprise (including, but not limited to, the power to participate in any business or enterprise as a general or limited partner or on a joint venture basis under the broad powers and discretions which are granted herein), which the Trustee may maintain, continue or operate at the risk of the Trust Estate and not at the risk of the Trustee, provided, however, that unproductive or underproductive property shall not be held as an asset of any trust for more than a reasonable time during the lifetime of any income beneficiary without the consent of such beneficiary. 2. Investments -- To invest and reinvest all or any part of the Trust state in every kind -of property, real, per- sonal or mixed, and every kind of investment, specifically including, but not limited to, corporate obligations of every kind, common or preferred stock, shares of investment trusts, investment companies and mutual funds, mortgage participations, deeds of trust, notes, and any one or more of the collective investment funds or common trust funds now or hereafter estab- lished and being administered by a corporate Trustee, as the Trustee, in the Trustee's absolute discretion, may select, it being the Trustor's express desire and intention that the Trustee shall have full power to invest and reinvest the trust ART. VIII, P. 1 • 0 funds without being restricted to forms of investment the Trustee may otherwise be permitted by law to make, and that the Trustee shall not be bound as to the character of any invest- ments by any statute,.rule of court, or custom governing the investment of trust funds. 3. Management of Securities -- To have all of the rights, powers, andprivileg_esof an owner with respect to securities held in the Trust Estate, including, but not limited to, the powers to vote, give proxies, and pay calls and assess- ments or other charges; to participate in voting trusts, pool- ing agreements, foreclosure, reorganizations, consolidations, mergers, liquidations, sales and leases, and incident to such participations to deposit securities with and transfer.title to any protective or other committee on such terms as the Trustee may deem advisable; and to purchase, exercise or sell stock subscription or conversion rights, warrants, puts and calls, and option contracts which give the Trustee or another the option to buy or sell, at a future time, any stock or security of any company; and to purchase securities or trade on margin, to sell short, to -borrow securities, to deliver against short sales, and to otherwise invest the assets of the Trust Estate in any manner available to it in the normal course of security trading with any securities broker. 4. Use of Nominee -- To hold securities or other property in the rustee s name as Trustee under this Declar- ation of Trust, or in the Trustee's own name without any language showing that the Trustee in whose name an asset is obtained holds the same in trust, or in the name of nominee other than the Trustee selected by the Trustee for that purpose, or the Trustee may hold securities unregistered in such condition that ownership will pass by delivery. 5. Sale, Exchange, Rye air, -- To manage, control, grant options on, se an ispose of the whole or any part of the Trust Estate (on such terms and for such property and cash, or part cash and credit, as the Trustee may deem best), convey, exchange, partition, divide, improve and repair trust property. 6. Leases -- To lease trust property for terms within or beyon t e term of the trust and for any purpose, including exploration for and removal of gas, oil, and other minerals; and to enter into community oil leases, pooling, and unitization agreements. 7. Loans -- To borrow money on behalf of the Trust Estate (including from the Trustee acting as an individual or in its corporate capacity ), and to encumber or hypothecate trust property by mortgage, deed of trust, pledge, or other- wise, for the debts of the Trustee or a co-owner; and to lend ART. vill, p. 2 money to any person, provided that any such loan shall be adequately secured and shall bear a reasonable rate of inter- est. 8. Insurance -- To carry, at the expense of the trust, insurance of—s—u—cH kinds and in such amounts as the Trus- tee deems advisable to protect the Trust Estate and the Trustee against any hazard; and, notwithstanding any other provisions i of this Declaration of Trust, to obtain or retain as an asset of the Trust Estate any polices of life insurance insuring the life of someone other than the Trustors (the Trustee is author- ized and directed to pay premiums on any such policy or poli- cies owned by the Trustee from principal or income of the trust, or partially out of each of them,.in such manner and proportions as the Trustee in its -absolute discretion may de- termine to be advisable; this provision shall not be construed to require the Trustee so to maintain such insurance in effect, and if, in the sole discretion of the Trustee and in view of existing circumstances, the Trustee deems it advisable and in the best interests of the beneficiaries hereunder, the Trustee shall be free to exercise any rights of ownership in any or all such policies, including surrendering said policies for cash. 9. Litigation -- To commence or defend such litiga- tion with respect to tie Trust or any property of the Trust Estate as the Trustee may deem advisable, at the expense of the Trust, and to compromise or otherwise adjust any claims or ligigation against or in favor of the Trust. B. Special Powers 1. Determination of Income and Principal -- The Trustee acting ereun er s a ave t e exc usive power, exer- cisable in the sole discretion of the Trustee, to determine what is principal or income of the Trust Estate and to appor- tion and allocate receipts and expenses and other charges between these accounts, including also the power to charge in whole or in part against principal or to amortize out of or charge forthwith to income, premiums paid on the purchase of bonds or other obligations, and including also the power from time to time to depreciate or not depreciate building improve- ments of trust income producing assets by transferring or not trans- ferring from income cash to principal cash the, amount the Trustee determines to be proper for periodic depreciation of such improvements. The Trustee may rely upon the statement of the paying corporation as to whether dividends are paid from profits or earnings, or are a return of capital or a distrib- ution of assets and as to any other fact relevant hereunder concerning the source or character of dividends or distribu- tions of corporate assets. If the trust shall be a member of a partnership, the Trustee shall be entitled to accept, with ART. vill, p. 3 respect to such partnership interests, any accounting methods used by the partnership, regardless of whether such methods shall include depreciation reserves, regardless of the assump- tions on which any such reserve may be based, and regardless of whether such accounting methods are inconsistent with those methods used by the Trustee with respect to other property of the Trust Estate. No inference of imprudence or partiality shall arise from the fact that the Trustee, in exercising the discretion conferred here on the Trustee, shall have allocated a receipt or expenditure in a manner contrary to any provision of the California Revised Uniform Principal and Income Act. Except insofar as the Trustee shall exercise the discretion conferred on the Trustee and except as otherwise provided in this instru- ment, matters -relating to principal and income shall be gov- erned'by the provisions of the California Revised Uniform Principal and Income Act from time to time existing. " The provisions of this paragraph shall not apply to Trust "B and Revhtnmthe olons of the l ifornia isedUniform Principal ad IncoeActonlyshall beapplic- able. 2. Bonds Purchased at Discount or at Premium The Trustee may purc ase on s at suc iscount or at such a premium in connection with the purchase as the Trustee, in the Trustee's discretion, deems advisable, provided, however, that each discount shall be accumlated periodically and each premium shall be repaid periodically to principal out of the interest on the bond, both in such reasonable manner as the Trustee shall determine, and to the extent necessary, out of the pro- ceeds on the sale or other disposition of the bond. Nothwith- standing the foregoing, all discounts shall be accumulated dur- ing the lifetime of the surviving Trustor in respect to Trust 11B��. 3. Ca ital Gains Distribution -- Notwithstanding any other provisions o t is Dec aration of Trust, the Trustee shall allocate to principal all dividends or other payments or distribution made by any corporation or mutual fund that are designated by the corporation or mutual fund as a distribution of capital gain. 4. Ph sicaI Division of Trust Pro ert Not Re uired - There need be no p ysica segregation or ivision o t e various trusts except as segregation or division may be requir- ed by the termination of any of the trusts, but the Trustee shall keep separate accounts for the different undivided inter- ests. 5. Distribution in Kind -- Upon any division of the Trust Estate into separate s ares or trusts, and upon any par- tial or final distribution, the Trustee may apportion and allo- ART. VIII, p. 4 cate the assets of the Trust Estate in cash or in kind, or partly in cash and partly in kind, or in undivided interests, in such manner and at such valuations as the Trustee in its discretion deems advisable or determines. The decision of the Trustee as to what constitutes a proper division of the Trust Estate either prior to or upon any distribution thereof shall be binding upon all of the beneficiaries. In making any divi- sion or partial or final distribution of the Trust Estate, the Trustee shall be under no obligation to make a pro rata divi- sion, or to distribute the same assets to beneficiaries simi- larly situated; but rather, the Trustee may, in the Trustee's discretion, make a non -pro rata division between trusts or shares, and non -pro rata distributions to such beneficiaries, as long as the respective assets allocated to separate trusts or shares, or distributed to such beneficiaries, have equiva- lent or proportionate fair market value. This paragraph shall not apply to the division of the Trust Estate upon the creation of Trust "B". The Trustee may sell such property as it deems necessary to make any such division or distribution. After any division of the Trust Estate, the Trustee may make joint in- vestments with funds from some or all of the several shares or trusts. 6. Withhold Payment if Conflictin Claims -- At the time for distribution o any property un er t is Dec aration of Trust, the Trustee shall have the power in the Trustee's abso- lute discretion to withhold, without the payment of interest, all or any part of the distribution from the person entitled to it, so long as the Trustee shall determine that the property may be subject to conflicting claims, to tax deficiencies, or to liabilities, contingent or otherwise, properly incurred in the administration of the Trust Estate. 7. Pa ments to Beneticiaries under If at any time or rom time to time any ene iciary entit e to receive income or principal hereunder shall be a minor, or an incompetent, or a person whom the Trustee deems to be unable to wisely or properly handle funds if paid to him directly, the Trustee may make any of such payments, in its discretion, in any one or more of the following ways: (a) Directly to such beneficiary; (b) To the natural guardian, custodian under California law, or the legally appointed guardian, conservator, or other fiduciary of the person or estate of such beneficiary; (c) To any person or organization furnishing care, support, maintenance -or education for such beneficiary, or ART. vIII, p. 5 (d) By itself making expenditures directly for the comfort, care, support, maintenance, or education of such beneficiary. The Trustee shall not be required to see to the application of any funds so paid or applied and the receipt of such payee shall be full acquittance to the Trustee. The deci- sion of the Trustee as to direct payments or application of funds shall be conclusive and binding upon all parties in interest. S. Invasion of Principal for Beneficiaries -- It is not the intention of the Trustor necessarily to conserve the Trust Estate for the use and benefit of the beneficiaries, or any of them, who ultimately may be entitled thereto by virtue of the provisions of the trust. On the contrary, if at any time or times during the life of this trust any beneficiary entitled to receive income (unqualifiedly, or in the discretion of the Trustee) shall be in want of additional monies for reasonable care, maintenance, support and education, or in the case of a child or a grandchild of Trustor (and in the event said child or grandchild is not an income beneficiary, but has a contingent interest, then invasion hereunder from Trust A is expressly authorized at all times) for his or her reasonable education, including study at an institution of higher learn- ing, and additionally in the case of the surviving Trustor if in•want of additional monies for proper care, maintenance, support and education as may be reasonably required, in each such case of want, the Trustee may as often as it deems neces- sary pay to or apply for the use and benefit of any such bene- ficiary such additional part, up to and including the whole thereof, of the principal of the Trust Estate, or if the Trust Estate has been apportioned into shares, of the principal of the respective trust of each beneficiary, all as the Trustee in its discretion believes is necessary tomeet for saidthe care beneficiary. For purposes of this paragraph, payments maintenance of any beneficiary may include, in the discretion of the Trustee, contributions in reasonably maintaining a home where said beneficiary resides or intends to reside, and education of persons with whom the beneficiary resides, including, but not by way of limitation, the guardian of the person of a minor beneficiary and the guardian's spouse and children. Any invasion under the above, provisions for the benefit of a surviving Trustor shall first be made from the principal of Trust "B', and shall be made from Trust "A" only if all princpal and income of Trust B has been exhausted. 9. Use of Real Property -- The surviving Trustor shall have the rig t to occupy and use until death the home Trustors may own and be using as their principal residence at the time of the death of the first Trustor if it becomes part of the Trust Estate. The Trustee may at any time, with the consent of said surviving Trustor, sell such home or any ART. VIII, P subsequent residence belonging to the Trust Estate, and, if the surviving Trustor shall so desire, purchase or build another comparable residence to be used as a home by the surviving Trustor until death. The surviving Trustor shall not be required to pay rent for such home. In addition, the surviving Trustor may at any time give up the right of occupancy of any property which he or she may be using in accordance with the terms of this paragraph and may elect not to have another property built or purchased. Subject to the right of occupancy of the surviving Trustor, any property held by the Trustee under the terms of this paragraph or the proceeds of the sale of any such property shall be a part of the principal of the Trust Estate of this trust. All taxes, insurance, repairs, and other charges or amounts necessary for the general upkeep and reasonable improvements of any property held in the Trust Estate under the terms of this paragraph shall be paid out of the income of the Trust Estate and shall be allocated between the various trusts herein to the extent of their interests. In addition, the Trustee is expressly author- ized, in the Trustee's discretion, to permit any beneficiary having any interest in the income of a trust, or guardian of the beneficiary's person, or any suitable person with whom the beneficiary resides, to occupy any real propery forming a part of -that trust on such terms as the Trustee shall deem proper, whether rent free or in consideration of payments of taxes, insurance, maintenance, and ordinary repairs, or otherwise. 10. Use of Tangible Personal Property -- In the event the Trust Estate consists o any tangi a personal pro- perty, the Trustee, in the Trustee's discretion, may at such times as may promote the welfare of any trust beneficiary deliver to or make available for the use of any income bene- ficiary any articles of personal, domestic, or household use which are part of the Trust Estate, such as furniture, furn- ishings, appliances, books, pictures, silver, china, clothing, jewelry, sporting goods and the like, as well as any boat, trailer, or automobile belonging to such Trust Estate. In such event the Trustee may thereafter carry such property as a trust asset at nominal value only, or may consider the same as having been expended for the care, comfort, maintenance, education or recreation of the income beneficiary and write off such per- sonal property as an asset of the trust, and upon taking such action the Trustee shall thereafter be fully discharged with respect to the values so reduced or written off. It is the Trustor's wish hereby to assure the greatest freedom of use of such personal property for the beneficiaries' welfare (without requiring disposal thereof by sale) and to consider it as expendable for such purpose to the extent the Trustee deems advisable. ART, vIII, p. 7 11. Purchase of Assets of Loans from Estate -- If the Trustee deems it necessary or advisable or t e protec- tion of the estate of a deceased Trustor or in the best inter- est of the Trust Estate or the beneficiaries herein, the Trustee may, in its sole and absolute discretion, deal with the personal representative of the estate of either Trustor, or with the Trustee under any testamentary trust created by the Will of either Trustor. The Trustee may purchase assets at their fair market value, as of the time of purchase, from legal representatives or from such testamentary trustees, or may loan funds from the Trust Estate to such representatives in such capacity, upon such terms and conditions as the Trustee here- under in its sole discretion may deem advisable, which loans may be either secured or unsecured, and may either bear inter- est at a reasonable rate or not, in the discretion of the Trustee. The Trustee hereunder shall incur no liability as a result of such purchase or purchases, whether or not the purchased assets constitute investments which may be legally made by the Trustee, or as a result of the making of such loans for any reason whatsoever. 12. PaYment of Death and Gift Tax, or of Last Illness and Funera x enses -- a rustee, in the Trustee's i.scretion, shall ave t e power to pay from appropriate trust assets, any estate, inheritance, or other death taxes, together with interest, penalties, costs, Trustee's compensation and attorney's fees, occasioned by the death of any income benefi- ciary and related to the beneficiary's interest in any trust, and any gift tax, together with interest, penalties, costs, Trustee's compensation and attorney's fees, imposed upon the surviving Trustor because of any election or waiver under this Declaration of Trust, to the extent that such taxes are attri- butable to the Trust Estate or any part of it, unless other adequate provision shall have been made therefor. The Trustee may make any such payments directly, or to a personal repre- sentative or other fiduciary, and the Trustee may rely upon the written statement of such fiduciary as to the amount and propriety of such taxes, interest, penalties, or other costs, and shall be under no duty to see to the application of any funds so paid. Further, upon the death of any income benefi- ciary, in the Trustee's discretion, income or principal of the appropriate trust may be used to pay the last illness and funeral expenses, and other obligations incurred for the sup- port of such income beneficiary. 13. Purchase of Treasur Bonds Redeemable at Par -- The Trustee may pure ase, in t e rustee s iscretion, at less than par, obligations of the United States of America that are ART. VIII, P. 8 redeemable at par in payment of any federal estate tax liabil- ity of either Trustor in such amounts as the Trustee deems advisable, and for that purpose, the Trustee may partition a portion of the community property of the Trust Estate and make such purchases from either or both portions. The discretion granted in this paragraph should be freely exercised at any time, or from time to time, when information is received by the Trustee making it appear that one of the Trustors may be ser- iously ill, or that there may be substantial and progressive deterioration in such Trustor's state of health, and the Trustee may borrow funds and give security for that purpose. The Trustee shall resolve any doubt concerning the desirability of making the purchase and its amount in favor of making the purchase and in purchasing a larger, even though somewhat . excessive, amount. The Trustee shall not be liable to either Trustor, to any heir of either Trustor, or to any beneficiary of this trust for losses resulting from purchases made in good faith. The Trustee is directed to redeem any such obligations that are part of the Trust Estate to the fullest extent possible in payment of federal estate tax liability of the Trustor for whom such obligations were purchased. The Trustee is authorized to rely conclusively upon any written estimate by the personal representative of the estate of a deceased Trustor of the amount of the federal estate tax imposed on such Trustor's estate, and hence, as to the amounts of government bonds which may be redeemed at par in payment of that tax, and as to the amounts of all other taxes, penalties, interest and expenses to be paid by the Trustee. The Trustee shall have no duty to determine the propriety of the payment of any such amount or sum so certified by the personal representative of the deceased Trustor. 14. Minimized Tax Liabilities -- The Trustee shall have the power, in the Trustee's absolute discretion, to take any action and to make any election to minimize the tax lia- bilities of this Trust and its beneficiaries, and to allocate the benefits among the various beneficiaries, and to make ad- justments in the rights of any beneficiaries, or between the income and principal accounts, to compensate for the consequen- ces of any tax election of any investment or administrative decision that the Trustee believes has -had the effect of dir- ectly or indirectly preferring one beneficiary or group of beneficiaries over others. 15. Release of Powers -- The Trustee shall have the power to release or to restrict the scope of any power that the Trustee may hold in connection with any trust created in this Declaration of Trust, whether such power is expressly granted in this Declaration of Trust or implied by law. The Trustee shall exercise this power in a written instrument executed by ART. VIII, P the Trustee, specifying the power or powers to be released or restricted and the nature of the restriction. 16. Advisers of the Trustee -- The Trustee is auth- orized to employ any custo ian, investment adviser, attorney, accountant, or any other agents to assist the Trustee in the administration of any trust herein and to rely on the advice given by these agents. Reasonable compensation for all ser- vices performed by these agents shall be paid from the trust for which such services are performed, out of either income or principal as the Trustee, in the Trustee's discretion, shall determine, and shall not decrease the reasonable compensation to which the Trustee is entitled. 17. Termination of Small Trust Estate -- Any other provision herein contained to the contrary notwithstanding, in the event the share or separate trust held for any income beneficiary who is a competent adult has, at any time, in the opinion of the Trustee, a fair market value of $25,000.00 or less at the end of any calendar year, the Trustee may, in the Trustee's discretion, but is not required to, terminate the trust and distribute the principal and any accrued or undistri- buted net income thereon to the beneficiary entitled thereto. 18. Dela ed Termination -- Notwithstanding that by the terms hereo t is Trust may terminate by reason of the death of a Trustor, another beneficiary, or for any other rea- son, the Trust shall remain open and in effect for a reasonable period of time in order to receive assets made payable to the Trustee upon or by reason of the death of a Trustor and/or to complete the orderly administration of the Trust, including the payment of all taxes due upon or by reason of the death of a Trustor or other beneficiary. 19. Deferred Division of Distribution of Trust Assets -- Whenever t Ee rustee is irecte to make --a-Ti `vis ion of trust assets into separate trusts or shares on the death of a Trustor, Trustee may, in the Trustee's discretion, defer such distribution or division until six (6) months after the Trus- tor's death. If the Trustee defers distribution or division of the Trust Estate, the deferred division or distribution shall be made as if it had taken place at the time prescribed in this instrument in the absence of this paragraph, and all rights given to the beneficiaries of such trust assets under other provisions of this instrument shall be deemed to have accrued and vested as of such prescribed time. ART. VIII, p- 10 A R T I C L E IX GENERAL PROVISIONS A. Spendthrift Clause Except as expressly provided elsewhere herein, no beneficiary under this trust shall assign, transfer, convey, anticipate, pledge, hypothecate, or otherwise encumber his or her interest hereunder, and neither the principal of this trust, nor any income arising therefrom, shall be liable for any debt of any such beneficiary or be subject to any bank- ruptcy proceeding, or claim of creditors, or be subject to any judgment rendered against any such benenficiary, or to the process of any court in aid of execution of any judgement so rendered. The Trustee may, however, deposit in any bank designated in writing by a beneficiary, to the beneficiary's credit, income or principal payable to such beneficiary. B. Rule Against Perpetuities Unless sooner terminated in -accordance with other provisions of this Declaration of Trust, each trust created herein shall terminate twenty-one (21) years after the death of the -last survivor of Trustor-Husband, Trustor-Wife, and the last to die of beneficiaries in being at the death of the First Trustor. All principal and undistributed income of any trust so terminated shall be distributed to the then income benefi- ciaries of that trust in the proportions in which they are; at the time of termination, entitled to receive the income; provided, however, that if the rights to income are not then fixed by the terms of the trust, distribution under this clause shall be made, by right of representation, to such issue of the Trustors as are then entitled or authorized, in the Trustee's -discretion, to receive income payments, or, if there are no such issue of the Trustor, in equal shares to those benefici- aries who are then entitled or authorized to receive income payments. C. Construction The primary purpose of the Trustors in establishing these trusts is to provide for the income beneficiaries and the rights and interests of remaindermen are subordinate to that purpose. The provisions of this agreement shall be construed liberally in the interest of and for the benefit of the income beneficiaries. ART. IX, p. 1 C D. Exercise of Trustee's Discretion All discretions granted to or vested in the Trustee by any provision of this Declaration of Trust shall be sole and absolute in the Trustee, and any action taken by the Trustee, or refrained from, in good faith shall be binding and conclu- sive upon all persons and entities interested herein. E. Meaning of References The words "issue", "child", and "children", as used in this instrument, shall include children legally adopted and the lawful issue of any legally adopted or lawful natural child. The words "incompetent or incompetence", as used in this instrument, shall be deemed to include not only persons who have been so declared by a court of competent jurisdiction, but also persons for whom a guardian or conservator or other fiduciary of the person or estate or both shall have been appointed by a court of competent jurisdiction. F. Gender and Number As used in this Declaration of Trust, the masculine, feminine, or neuter gender, and the singular or plural number, shall each be deemed to include the other whenever the context so indicates. The term "Trustee" as used herein shall be deemed and is intended to include any succeeding Trustee. G. Definition of "Education" Whenever provision is made in this Declaration of Trust for payment for the education of a beneficiary, the term "education" shall be nclude high college, post -graduate study,lcand etrade business d to land/or otrain- ing, so long as pursued to advantage by the beneficiary, at an institution of the beneficiarv's choice; and in determining payments to be made for such high school, college, post- graduate or technical education, the Trustee shall take into consideration the beneficiary's related living expenses to the extent that they are reasonable. H. Headings The headings in this instrument are inserted for convenience of reference and are not to be considered in con- struction of the provisions hereof. I. Situs - Law Governing Trust The appropriate Superior Court of the State of California shall have jurisdiction for all of the purposes set ART. IX, p. 2 forth in Section 1138.1 of the California Probate Code. After the death of Trustor, only the Trustee and any adult person entitled to current income distribution or to current distribu- tion of income or principal at the Trustee's discretion may invoke the court's jurisdiction. This trust has been accepted by the Trustee and it is intended it will be administered in the State of California, and its validity, construction, and all rights thereunder shall be governed by the laws of Cali- fornia. The laws of the State of California shall apply regardless of any change of residence of any beneficiary, or the appointment or substitution of a Trustee residing or doing business in another State. J. Severability If any provision of this Declaration of Trust should be invalid or unenforceable, the remaining provisions shall nevertheless be carried into effect. K. Notices to Trustee of Event Affecting Interest Until the Trustee shall receive from some person interested in the trust written notice of a death, birth, marriage, or other event upon which the right to receive income or..principal of the Trust Estate may depend, the Trustee shall incur no liability for any disbursments or distributions made or omitted in good faith as though the event had not occurred. L. Instrument of Trustee Any instrument executed by the Trustee shall be binding upon all parties hereto and all beneficiaries here- under. No person paying money to the Trustee need see to the application of the money so paid. M. Accounting The Trustee shall make an annual accounting of the administration of the Trust Estate to the Trustors, if living, and after the death of the Trustors, the Trustee shall make an annual accounting of the administration of each trust to the income beneficiary thereof, and to any contingent beneficiary or remainderman, upon request, within sixty (60) days of the end of the fiscal year of each trust. N. Accrued Income -- Death of Beneficiary Accrued income and undistributed income held by the Trustee on the termination of any interest in this Declaration of Trust, other than Trust "B" , shall be paid to the next succeeding beneficiaries in proportion to their interests under ART. IX, p. 3 this Declaration of Trust. In any case where an income benefi- ciary and remainderman die under such circumstances that it is doubtful or difficult to prove which individual died first, then it shall be conclusively presumed that the income benefi- ciary shall have survived the remainderman. 0. No Apportionment of Expenses Among successive beneficiaries under this Declara- tion of Trust, all taxes and other current expenses shall be deemed to have been paid and charged to the period in which the first became due and payable. The Trustee shall not be required to prorate taxes and other current expenses to the date of termination of any trust. P. Consideration of Outside Resources of Beneficiaries Whenever the Trustee is given discretion to pay to or apply for the use and benefit of any beneficiary sums out of income and/or principal for beneficiar's support, care, main- tenance and/or education, the Trustee is directed to take into consideration, to the extent the Trustee shall deem advisable, any income or other resources of the beneficiary, outside the trust, known to the Trustee, unless the particular provision creating the discretionary powers otherwise states. Q. Power to Withdraw or to Appoint Non -Cumulative All powers of withdrawal or of appointment are non -cumulative, so that if the beneficiary possessing the power does not withdraw or appoint, during any calendar year, the full amount to which the beneficiary is entitled under the provision granting the power, such right to withdraw or to appoint the amount indicated shall lapse at the end of each calendar year in which the beneficiary had the power. R. Exercise of a Power of Appointment Upon the exercise of any power of appointment cre- ated by this Declaration of Trust, the Trustee shall distribute the assets of the trust subject to such power of appointment, as follows: (1) Where a general power of appointment is cre- ated, to such one or more persons and entities including the beneficiary's own estate, as the beneficiary shall appoint; and (2) Where a special or limited power of appointment is created, to such one or more persons and entities, as stated in the provision creating the power, as the beneficiary shall appoint. ART. IX, p. 4 The appointment may be made on such terms and condi- tions, either outright or in trust, as the beneficiary possess- ing the power shall direct either by a Will or by a document delivered to the Trustee specifically referring to and exerci- sing the power of appointment, whether said Will or document is executed before or after the death of the first Trustor to die. Unless within ninelty (90) days after the death of the benefi- ciary possessing the power of appoinment the Trustee has actual notice of the existence of a Will or of probate proceedings and no written document purporting to exercise the power shall be subsequently located, the Trustee shall not be liable to the appointees under that exercise, and the rights of the appoin- tees and the persons receiving property from the Trustee shall be governed by applicable law. S. Guardian or Conservator Any election or action required of the Trustors or of any beneficiary under this Declaration of Trust may be performed by their legally appointed guardian or conservator T. Contest of Will or Trust by Beneficiary In the event any beneficiary under this trust shall, singly or in conjunction with any other person or persons, contest in any court the validity of this trust or of either Trustor's last Will, or shall seek to obtain an adjudication it any proceeding in any court that this trust or any of its provisions or that such Will or any of its provisions is void, or seek otherwise to void, nullify, or set aside this trust or any of its provisions, then the right of that person to take any interest given him by this Trust shall be determined as it would have been determined had the person predeceased the execution of this Declaration of Trust without surviving issue. The Trustee is hereby authorized to defend, at the expense of the Trust Estate, any contest or other attack of any nature on this trust or any of its provisions. U. Certification To the same effect as if it,were the original, anyone may rely upon a copy certified by a Notary Public to be a counterpart of the instrument (and of the writings, if any, endorsed thereon or attached thereto). Anyone may rely upon any statement or act certified by anyone who appears from the original document or a certified copy to be a Trustee hereunder. ART. IX, p. 5 0 V. Names of Trusts After the death of both Trustors, the Trusts created herein may be referred to collectively as "THE J. WILLIAM AND MONIQUE T. BACK TRUST, dated September 15, 1982" and each trust created herein may be referred to by adding the name or names of a beneficiary of this trust, such as "THE J. WILLIAM AND MONIQUE T. BACK TRUST, dated September 15, 1982, for the bene- fit of GRETCHEN AND JOSEPH BACK". IN WITNESS WHEREOF, the Trustee executes this Declara- tion of Trust on'the 15th day of September, 1982, at Los Angeles, California. J j T ILLIAM BACK, TrusItee We certify that we have of Trust and that it correctly upon which the Trust Estate if of by the Trustee. We approve particulars, and have requested M NI-UE• . BACK, Trustee read the foregoing Declaration stated the terms and conditions to be held, managed and disposed the Declaration of Trust in all the Trustee to execute it. DATED: September 15, 1982 P // 4� J.;Agi/LL1AM B— ACC, Irusr'� Social Security No. 51,4,- 3q- 110 APPROV, 1 iF,RR VA. DLIVAR Attorney for Trustors MO I U 'T. BACK, Trustor Social Security No. 7q0-a1.-(,`b9 ART. IX, p. 6 r liv RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO M. Gretchen Anderson 1611 Ramona Avenue South Pasadena, CA 90130 ASSIGNMENT OF LEASE For valuable consideration, the receipt and sufficiency of which is hereby acknowledged, J. William Back and Monique T. Back, husband and wife ("Assignor"), as community property hereby assign to J. William Back and Monique T. Back, Trustees of The J. William Back and Monique T. Back Trust of 1982 all of their right, title and interest in that certain lease commencing January 1, 1988 and ending on July 1, 2006, between Assignor and The City of Newport Beach (the "Lease"). The Lease is referenced in that certain Memorandum of Lease dated July 1, 1988 and recorded as Instrument No. 88-463725 in the Official Records of Orange County, California, with reference to the following described real property: Lot 1 of the eastside addition to Beacon Bay recorded on Official Maps Book 2, Page 30 in the Office of the County Recorder, County of Orange, State of California. Executed this L day of August, 1989, Los Angeles, California. (193:AGM0118H89) "ASSIGNOR" �— William Back Monique T. ack r `% 0 STATE OF CALIFORNIA, ) ss. COUNTY OF dos ntiGEL�s ) on e9L)&US"F 10 , 19§j, before me, the under- signed, a Notary Public in and for said State, personally appeared J. William Back and Monique T. Back, personally known to me (or proved to me on the basis of satisfactory evidence) to be the persons whose names are subscribed to the within instrument and acknowledged that they executed the same. WITNESS my hand and official seal. OFFICIAL SEAL M. DUDLEY n03rmv00u0•cu�rORIM L,,.,,LE9 COUNTY M/ Comm. ErD9elNna 15.1993 (Notarial Seal) [193:ACKO12OH89] Notary Public in d for said County an State Recording Requested by and When Recorded Mail to: J. Todd Anderson, Esq. 1611 Ramona Avenue South Pasadena, CA 91030 LICENSE AGREEMENT This License Agrgement ("Agreement") is made and entered into as of the Z- day of a usT 1989, by and between J. William Back and Monique T. Back ("Back"), and Linda C. Jackson, an unmarried woman ("Jackson")with reference to the following facts: Recitals A. Back is the owner of that certain real property commonly known as 62 Beacon Bay in the City of Newport Beach, County of Orange, California, more particular described in Exhibit "A" attached hereto and incorporated herein by this reference ("Back Property"), upon which a single family resi- dence ("Back House") is located; B. Jackson is the owner of that certain real prop- erty commonly known as 22 Beacon Bay, in the City of Newport Beach, Orange County, California, more particularly described in Exhibit "B" attached hereto and incorporated herein by this reference ("Jackson Property"), upon which a single family res- idence ("Jackson House") is located; C. In connection with the remodeling of the Jackson House by Jackson's predecessor in interest, Ronald Melville ("Melville"), Melville asked Back for permission to use a por- tion of Back's Property, consisting of a 5 foot wide strip, lying between the northern most edge of the Back House and the southern most property line of Jackson's Property, running approximately 45 feet, from the northwest corner of the Back House to a gate presently located further east along said strip (the "Licensed Property"); D. Use of the Licensed Property by Melville and Jackson has been and shall be limited to the planting and main- tenance of landscaping and the installation of tile and use as a patio by Melville and Jackson. This license is non-exclusive and shall not in any way preclude Back's use of the Licensed Property or the use by any other licensee of Back; 193:AGMO111G09 E. Back granted a license to Melville to use the Licensed Property and now wishes to grant a license to Jackson to use the Licensed Property on the terms and conditions set forth herein. AGREEMENT NOW, THEREFORE, in consideration of the foregoing, and the covenants and agreements on the part of each party to the other, as hereinafter set forth, it is agreed as follows: 1. Back hereby grants to Jackson a non-exclusive license to use the Licensed Property for use and maintenance of landscaping and for the installation of tile and use as a patio. Jackson shall maintain the landscaping and the patio in good condition and repair for such period of time as this Agreement shall be in effect. This license shall not limit Back's right to also use the Licensed Property or to grant licenses to others to use the Licensed Property. 2. The license being granted by this Agreement is personal to Jackson and may not be assigned by Jackson without the consent of Back or Back's successors in interest. Back's successors in interest shall have the same rights and obliga- tions hereunder as Back and Jackson's approved successors in interest shall have the same rights and obligations as Jackson. 3. This Agreement is terminable at will by Back or Jackson or their successors in interest. Termination will be effective 30 days following Notice (as defined below) by the nonterminating party of the terminating party's election to terminate, at which time Jackson shall, at Jackson's sole expense, remove the landscaping and the patio from the Licensed Property, if requested by Back. 4. Jackson hereby agrees to indemnify and hold harmless Back from any and all liability, loss, cost, damage or expense (including, without limitation, attorneys' fees), which Back may or might incur from any and all claims and demands which may be asserted against Back and which claims arise from Jackson's use of the Licensed Property or by virtue of Jackson's exercising Jackson's rights under this Agreement. If Back incurs any such liability, loss or damage in defense against such claims or demands, the amount thereof (including costs, expenses and reasonable attorneys' fees) together with interest thereon at the rate of ten percent (10%) per annum, shall be reimbursed to Back by Jackson immediately upon demand. Jackson further agrees to include the Licensed Property as insured property on Jackson's homeowner's insurance policy and to name Back as an additional named insured on such policy. 193tAGM0111G09 2 - Such policy shall provide that Back shall be given 30 days written notice prior to cancellation of such policy. 5. In the event either party brings an action to enforce the terms hereof, the prevailing party in any such action shall be entitled to reasonable attorneys' fees to be paid by the losing party. 6. This Agreement shall be construed in accordance with the laws of the State of California wherein the properties are located. 7. The parties hereto agree to execute such other documents as may be necessary to fulfill the intent of this Agreement. 8. Time is of the essence with respect to the per- formance of each of the covenants and agreements contained herein. 9. All notices to be given under this Agreement ("Notice") shall be in writing and shall be effective upon receipt, whether delivered by personal delivery or sent by United States registered or certified mail, return receipt requested, postage prepaid, addressed to Back or Jackson and delivered to the Back Property or the Jackson Property. A Notice of Termination shall also be effective by recording such Notice in the official records of Orange County, California. Either Back or Jackson may give written notice of a different address to receive Notice, which shall be effective until a subsequent Notice is given. Until further Notice to the con- trary is given, any Notice to Back shall be delivered to the following address: 107 Fremont Place, Los Angeles, California, 90005. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. GENERAL ACKNOWLEDGMENT State of California ll County of ORANGE 1SS. On this the 7thday of August 1989 , before me, PAMELA L. HARNEY the undersigned Notary Public, personally appeared LINDA C. JACKSON ❑ personally known tome a proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is subscribed to the within instrument, and acknowledged that she executed It. WITNESS my hand and official seal. NO. 201 STATE OF CALIFORNIA, ) ss. COUNTY OF Los PO&C-7Z.CS ) On A 199, before me, the under- signed, a Notary Public in and for said State, personally appeared J. William Back and Monique T. Back, personally known to me (or proved to me on the basis of satisfactory evidence) to be the persons whose names are subscribed to the within instrument and acknowledged that they executed the same. WITNESS my hand and official seal. OFFICIAL SEAL. M. DUDLEY NONIA iost�aEHI.EOsc onn tN Comm. ElpketJoe 25.1993 (Notarial Seal) [193:ACK0120H89] Notary Public in d for said County and State y EXHIBIT A That certain leasehold estate created by Lease dated January 1, 1988 by and between the City of Newport Beach, a chartered municipal corporation, as Lessor, and J. William Back and Monique T. Back, as Lessee, concerning the following described real property: Lot 1 of the east side addition to Beacon Bay recorded on Official Maps Book 2, Page 30 in the Office of the County Recorder, County of Orange, State of California. [193:EXH0139H89] EXHIBIT B That certain leasehold estate created by Lease dated July 14, 1989 by and between the City of Newport Beach, a chartered municipal corporation, as Lessor, and Linda C. Jackson and George T. Pfleger, as Trustee, as Lessee, concerning the following described real property: Lot 22 as shown on a Record of Survey Map filed in Book 9, Pages 42 and 43 of Record of Survey in the Office of the County Recorder, County of Orange, State of California. [193:EXH0132H891 • 0 J T 0 0 0 A N 0 E R S O N. A T T O R N E Y A T L A W 13191 Crossroads Parkway North . Sixth Floor . City of Industry, CA 91746-3497 Telephone(213) 692-9581 FAX (213) 695.2329 October 23, 1989 Mr. Kenneth J. Delino Executive Assistant City of Newport Beach City Hall 3300 Newport Boulevard Newport Beach, California 92658-8915 Re: 62 Beacon Bay Dear Mr. Delino: Enclosed is a copy of the executed Third Amendment to the Back Trust in the form previously approved by you as well as copies of the original Trust and other amendments. I also enclose a copy of the Assignment of Lease which we will record as well as the $50.00 transfer fee to the City of Newport Beach. Lastly, enclosed is a copy of a License Agreement entered into with the neighboring property owner (22 Beacon Bay) concerning use of a small strip of 62 Bpacon Bay, which we would like to also record. Please let me know if you have any objections to any of the enclosed documents. We intend to record them on November 13, 1989. Thank you for your cooperation. Enclosures OOT 2 0 M-2 I ` .,, , , , L l ,,,� • q S�Q ! 0 THIRD AMENDMENT TO THE BACK FAMILY TRUST Pursuant to the rights reserved in Section IA of THE J. WILLIAM AND MONIQUE T. BACK TRUST, established on September 15, 1982 and amended in June, 1986 and August, 1989, J. WILLIAM BACK AND MONIQUE T. BACK, Trustors, hereby amend said trust by adding the following new Section VIII A10: "VIII A10 Beacon Bay Lease Upon the death of the last to die of Trustors, the then serving Trustee shall comply with all terms of the Beacon Bay lease relating to the transfer of title." In all other respects Trustors hereby confirm, redeclare and republish the terms of the trust as amended. Executed at vs n c0/e�S , California, on this day of (I,f0. , 1989. �GJ, -T. Ti ack Monique T Back TRUSTORS We declare that we have read the foregoing Third Amendment to Declaration of Trust and that it correctly states the amended terms and conditions under which The J. William and Monique T. Back Trust is to be held, managed and disposed of by the Trustees. Dated. Z Z 1989 /f r a`j . "'WynThM Ba , Trustee Monique T. Bdck, Trustee SECOND AMENDMENT TO THE J. WILLIAM AND MONIQUE T. BACK TRUST This is a Second Amendment to the J. WILLIAM AND MONIQUE T. BACK TRUST, dated September 15, 1982, as amended in June 1986 (collectively, the "Trust"), of which J. William Back and Monique T. Back are the Trustors and the original Trustees. This Second Amendment is made with reference to the following facts: A. Joseph William Back, a child of the Trustors, is (or may be) the father of a child named Jasmine Owen, born in approximately February, 1988 ("Jasmine"). It is the intent -of the Trustors and Trustees specifically and uncategorically to renounce and exclude Jasmine from any rights or interests she might have under the Trust. 2. The first paragraph of Article 4 B. found on page two of Article 4 makes an inadvertent reference to "THE MONIQUE GRETCHEN BACK TRUST", when in fact such reference should be to "THE MONIQUE T. BACK TRUST". NOW, THEREFORE, J. William Back and Monique T. Back as the Trustors and the original Trustees of the Trust hereby amend the Trust as follows: 1. Jasmine is renounced and specifically excluded from any right or interest she otherwise might have as the issue of Joseph William Back including, without limitation, any right or interest to any portion of the Gretchen and Joseph Back Trust. In the event Joseph Back dies with no issue other than Jasmine, then, for purposes of the Trust, Joseph Back shall be considered to have no issue. If Joseph Back dies with issue other than Jasmine, then such other issue shall share equally and Jasmine shall take nothing. Any references to the living issue of a deceased child of the Trustors found in the Trust shall be deemed not to refer to Jasmine. 2. The first paragraph of Article 4 B of the Trust is amended in its entirety to read as follows: "B. Division of the Trust Estate Following the death of either Trustor, the Trustee shall divide the Trust Estate, including any additions made to the Trust by reason of the death of a Trustor, such as from the deceased Trustor's Will or from life insurance policies, into three (3) separate trusts, designated as "THE J. WILLIAM BACK TRUST", "THE MONIQUE T. BACK TRUST", and "THE GRETCHEN AND JOSEPH BACK TRUST". 3. In all other respects, the Declaration of Trust dated September 15, 1982, as amended by the First Amendment of June, 1986, is hereby reaffirmed. IN WITNESS WHEREOF, the Trustees execute this Second Amendment to the J. WILLIAM AND MONIQUE T. BACK TRUST on this day of August, 1989, at Los Angeles, California. x am Back, Trustee I�4ck, Trus We certify that we have read the foregoing Second Amendment to THE J. WILLIAM AND MONIQUE T. BACK TRUST, and approve it in all particulars. Dated: August 1989 . Wi lam Back, Trus r Moniqu . B k, Tru CN1-I'Lp55-- ,of 01 N (193=AMD0138H89] 0 0 FIRST AMENDMENT TO THE J. WILLIAM AND MONIQUE T. BACK TRUST THE J. WILLIAM AND MONIQUE T. BACK TRUST, 'dated September 15, 1982, of which J. WILLIAM BACK and MONIQUE T. BACK are the Trustors and the original Trustees, is hereby amended, revoking any prior Amendments previously made, in the following particu- lars: 1. All references in the Trust to Trustor's daughter, MONIQUE GRETCHEN BACK should now be reflected to read MONIQUE GRETCHEN ANDERSON. 2. ARTICLE VII, Paragraph G, entitled "Designation of Successor Trustee by Trustors", is amended in its entirety to read as o ows: "G. Designation of Successor Trustee by Trustors "Upon the death or incapacity of either Trustor, the other Trustor shall continue to act as Trustee and shall name a co -Trustee of his or her choice. First consideration of the named co -Trustee should be given to MONIQUE GRETCHEN ANDERSON, and thereafter to JOSEPH WILLIAM BACK. The surviving Trustor, while living and competent, shall have a right to replace the exis`ing co -Trustee. Upon the death or incapacity of the surviving Trustor, MONIQUE GRETCHEN ANDERSON and JOSEPH WILLIAM BACK shall act as co -Trustees. 3. In all other respects the Declaration of Trust, dated• September 15, 1982, is hereby reaffirmed. IN WITNESS WHEREOF, the Trustee executes this First Amend- ment to THE J. WILLIAM AND MONIQUE T. BACK TRUST on this day of June, 1986, at Los Angeles, California. I , rusteeMONIQUE T. BACK, Trustee We certify that we have read the foregoing First Amendment to THE J. WILLIAM AND MONIQUE T. BACK TRUST, and approve it in all particulars. DATED: June , 1986 J. WILLIAM BACK, Trustor MONIQUE T. BACK, Trustor Q ��WPORT (WY OF NEWPO-RT BBACA" p 6 NEWPORT BEACH, CALIFORNIA 92663 / O cl<IronN�r `a 19- (//-- DATE RECEIVED FROM FOR - m�L at' RECEIPT No. 42611 DEPARTMENT_�!� BY �YYYYYfUVVVVV " '" - PAY TO THE ORDER J. WM. BACK MONIQUE T. BACK 107 FREMONT PLACE WEST LOS ANGELES, CA 0005 BANK 9 iiso jEj I, L, Sn'14+1: & 2 2jb00O It 3l:OaT"'O I LOG 0 T, Tji s :18445 16411220 $ X Z-DOLLARS I ;4 , 4"ilill j Y 'Z t Ntl tt4" ... ........ CITY OF NEWPORT BEACH Office of City Manager (714) 644-3002 September 25, 1989 Mr. J. Todd Anderson 1611 Ramona Avenue South Pasadena,CA 91030 Subject: 62 Beacon Bay Dear Mr. Anderson: In response to your letter of August 14, 1989 (copy attached), enclosed is a sample of the required amendment. Call if you need additional information. Sincerely, l .per Kenneth Delino Executive Assistant KJD:mb Attachments City Hall • 3300 Newport Boulevard 0 P.O. Box 1768 0 Newport Beach, California 92658-8915 LILLICK & MCHOSE IRA S. LILLICK 11875.1007) A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS 101 WEST BROADWAY. SUITE 1800 SAN DIEGO, CALIFORNIA 92101 CABLES "LILLICKMCHOSE" ATTORNEYS AT LAW TELEPHONE (619) 234.5000 INTERNATIONAL TELEX-47 20401 TELECOPIER (213)029.1033 725 SOUTH FIGUEROA STREET SUITE 1200 LOS ANGELES, CALIFORNIA 90017-2513 WRITER'S DIRECT DIAL NUMBER TELEPHONE (213) 488-7100 ( 213 ) 488-7458 August 14, 1989 RECEIVED ti• AUG161989 i 10 Mr. Kenneth J. Delino, Executive Assistant Eozot: :tIsaM C'ev (1 Ts w $ OM4 City of Newport Beach ti any+haao,tla:Wn /) 3300 Newport Boulevard / Newport Beach, CA 92663 Re: 62 Beacon Bay Dear Ken: As we discussed today, I am both the son-in-law and attorney to William and Monique Back, the current owners of the above -referenced property. In connection with estate planning, we intend to transfer the above -referenced property to the J. William and Monique T. Back Trust of 1982. This will confirm that the City of Newport Beach is agreeable such a transfer and will execute a new lease with the Trust provided a $50 transfer fee is paid, a copy of the Trust is given to the City and provided the Trust is amended to include a provision regarding notice to the City in the event of the death of both Trustors. Please send me a copy of language acceptable to the City to be included in such an amendment. As I told you, I will be leaving this law firm, effective August 15. Accordingly, please mail the requested information to my home address which is: J. Todd Anderson, 1611 Ramona Avenue, So. Pasadena, CA 91030, telephone (213) 258-0733. Thank you. (193:LTR0148H89] 4 ....J MY ARM OFRCE SUITE 500 Sn AIRPORT OGUUN%RO BURLINGAME. CAUMRNIA 94010 NIM 3754000 SACRAMENTO OFRCE SURE 100 1121 L STREET SACRAMENTO, CALIFORNIA 95614 (910) 4424200 MUSICK, FEELER & GARRETT A LAW PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS ONE WILSHIRE BOULEVARD LOS ANGELES, CALIFORNIA 90017 TELEPHONE (213) 029-7600 TELEX 701357 TELECOPIER (2131 524-1370 May 12, 1987 Carole Korade, Esq. Assistant City Attorney City of Newport Beach 3300 Newport Boulevard Newport Beach, California 92663 Re: Rawlins Family Trust Dear Ms. Korade: ELVON MUSICK 1600-1968 LEROY A. GARRETT 1906-1963 JOSEPH 0. PEELER (RETIRED) WRITER'S DIRECT DIAL NUMBER (213) 629-7735 S ��yyQOGP��F In accordance with your request,, Mr. and Mrs. Rawlins have executed and I am transmitting herewith an amendment to their Trust requiring the Trustee to comply with all terms of the Beacon Bay Lease relating to transfer of title upon the death of the last to die of Mr. and Mrs. Rawlins. Based upon this document, I understand you will I now effectuate the transfer of the lease to the Trust. We thank you for your cooperation and trust you will let us know if we may be of further assistance. Very truly yours, ames M. Hassan, P. C. for MUSICK, PEELER & GARRETT JMH/aa Enclosure cc: Mr. and Mrs. Rea G. Rawlins FIRST AMENDMENT TO THE RAWLINS FAMILY TRUST Pursuant to the rights reserved in Section 3.2 of THE RAWLINS FAMILY TRUST, established on December 30, 1986, REA GEORGE RAWLINS and MARJORIE FARRAR RAWLINS, Trustors, hereby amend said trust by adding the following new Section 5.19: 115.19 Beacon Bay Lease Upon the death of the last to die of Trustors, the then serving Trustee shall comply with all terms of the Beacon Bay lease relating to the transfer of title." In all other respects Trustors hereby confirm, redeclare and republish the terms of the trust. Executed at1,e.�,gxtiCQa��, California, on this g= day of 'tit a y_ 1987. Rea George Rawlins Marjo ie Farrar Rawlins TRUSTORS . r�L 6 6 We declare that we have read the foregoing First Amendment to Declaration of Trust and that it correctly states the amended terms and conditions under which The Rawlins Family Trust is to be held, managed and disposed tof by the Trustees. Dated:, 1987 Maricoie Farrar State of California ) County of ) ns, On MA, I , 1987, before me, a notary public for the State of California, personally appeared REA GEORGE RAWLINS and MARJORIE FARRAR RAWLINS, personally known to me (or proved to me on the basis of satisfactory evidence) to be the persons whose names are subscribed to this instrument, and they acknowledged that they executed the same as Trustees and Trustors of the Rawlins Family Trust.. Witness my hand and OFFICIAL SEAL SERGE N. McKPIANP:. ` %4Z., ORANGE COUNT / My Commission Exp. Feb 26, 199! official seal. S /A li``(�1aw!ti- Notary P blic in and for said County and State u CITY OF NEWPORT BEACH c9<iFon��P office of City 'Manager (714) 644-3002 June 29, 1988 J. William Back i07 Fremont Place Los Angeles, CA 90005 Re: #62 Beacon Bay, Newport Beach, California Dear Mr. Back: In February of this year'you were sent a Memorandum of Lease to sign regarding your property at 62 Beacon Bay, Newport Beach. We never received the executed Memorandum. In the meantime, however, we have revised the Memorandum of Lease to reflect a cor-rection in the legal description. Enclosed is a copy'of the new Memorandum. We would appreciate it.if you would sign same and have it notarized and return it to the* City as soon as possible. Please note that you do not have a valid lease with the City until the Memorandum of Lease is recorded. If you have any questions, please feel free to call. Si cerel , KENNETH J. ELINO EXECUTIVE ASSISTANT KJD:atf Enclosure CERTIFIED MAIL RETURN RECEIPT REQUESTED City Hall 0 3300 Newport Boulevard, Newport Beach, California 92663 RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: City Manager's Office City of Newport Beach 3300 Newport Boulevard Newport Beach, CA 92663 Attn: Kenneth J. Delino MEMORANDUM OF LEASE - THIS MEMORANDUM OF'LEASE is made and entered into by and between the City of Newport Beach, .a chartered municipal corporation, herein called "Lessor," and J. WILLIAM BACK and MONIQUE T. BACK herein called "Lessee," to witness that: Lessor hereby leases to Lessee fora term of eighteen (18) years commencing on January 1, 1988, and ending on July 1, 2006, on the terms -and conditions set forth in, that certain lease by and between the parties hereto dated January 1, 1988, all the terms and conditions of which .lease are made a part hereof as though fully set forth herein, all those certain permises in the County of Orange, State of California. Lot 1 of the eastside addition to Beacon. Bay recorded' - on OfficialMapsBook 2,, Page -30 in the Office of the County Recorder, *County of Orange., State of California. EXECUTED on July 1988, Newport Beach, Orange County, California. LESSOR ATTEST: City Clerk APPROVED AS TO FORM: City Attorney The.City of Newport Beach, . a Chartered Municipal Corporation 8Y- ' Mayor LESSEE• BY: I: December 4, 1987 � jTY OF NEWPORT BEACH JANO 71988 :. ,,;•�.; G :Runt Uy nt I:a:/vut Ena:it TO: ALL BEACON -BAY LESSEES SUBJECT: DIRECT CITY LEASE Office of City Manager (714) 644-3002 Effective January 1, 1988 your lease with - the Beeks expires and your direct lease with the City commences. The direct leases must be signed during the month of December, 1987. Please come to the City Hall Lobby during working hours (Monday to Friday, 8:00 a.m. to 5:00 p.m.) to sign your lease. If you desire a signed copy for your records, please -bring your copy with you or we will provide another copy for a.$4.00 copying charge. The City's lease rate will now include the amount previously paid to the Beeks. If you have questions, please call 644-3002. Sincerely, KJD:ets KENNETH J. ELINO EXECUTIVE ASSISTANT C� AW41 Aal';O - 1 City all 3300 New rt Boulevard, Newport Beach, California 92663