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Stock Sale Agreement <br />This Stock Sale Agreement ("Agreement") is made and entered into as of February <br />20, 2024 ("Effective Date"), by and between the City of Redlands ("City") and the Yucaipa <br />Valley Water District ("Buyer"). City and Buyer are sometimes collectively referred to in <br />this Agreement as the "Parties" and individually as a "Party." <br />Recitals <br />WHEREAS, City is currently the registered owner of six -hundred forty-six (646) <br />shares of common stock of the South Mountain Water Company ("SMWC"); and <br />WHEREAS, City has agreed to offer Buyer the opportunity to purchase six - <br />hundred forty-six (646) shares of SMWC common stock (the "Purchased Shares"); and <br />WHEREAS, Buyer desires to exercise such opportunity to purchase the Purchased <br />Shares from City, upon the terms and conditions and for the consideration set forth in this <br />Agreement; and <br />WHEREAS, Crafton Hills Community College currently receives landscape <br />irrigation water through the South Mountain Water Company system as a City customer; <br />and <br />WHEREAS, Yucaipa Valley Water District has agreed to continue providing <br />Crafton Hills Community College with landscape irrigation water through the South <br />Mountain Water Company system until Crafton Hills Community College physically <br />disconnects from the South Mountain Water Company system; <br />NOW, THEREFORE, in consideration of the mutual covenants herein contained, <br />the Parties agree as follows: <br />Operative Provisions <br />1. Incorporation of Recitals. The Recitals set forth above are material and by this <br />reference are incorporated herein and made a part of this Agreement. <br />2. Purchase and Sale of Shares. Subject to the terms and conditions of this Agreement, <br />Buyer agrees to purchase at the Closing, defined below, and City agrees to sell the <br />Purchased Shares for the purchase price of Three Hundred Twenty Three Thousand Dollars <br />($323,000.00) ("Purchase Price"), payable in immediately available funds at Closing. <br />3. Closing; Delivery. <br />(a) The purchase and sale of the Purchased Shares shall take place at 35 <br />Cajon Street, Redlands, California 92373, five (5) days after City approves this Agreement, <br />or at such other time and place as City and Buyer mutually agree upon, orally or in writing <br />1 <br />I:\cmo\Agreements\Yucaipa Valley Water District Stock Sale Agreement 2.2,24 FY23-0033.docx-ms <br />