Glendale City Council
January 11, 2022

Property, at any time during the Lease Term, whether for any damage or injur y to any persons whatsoever or to any property of Tenant or of any other person, for any reason whatsoever, for any injury to Tenant’s residents, subtenants or others for actions or inactions after the date of the execution of this Lease, proximately caused by:
(a) Construction, operation or maintenance of any of the Improvements, or the condition of any part of the Property.
(b) Heating, ventilation or air conditioning systems, electrical wiring, plumbing, dampness, water, gas, steam, or other pipes, or sewage, o r the breaking of any electrical wire, bursting, leaking or running of water from any tank, washstand, water closet or waste pipe, supply pipe, sprinkler system, radiator, or any other pipe now or hereinafter installed on or about the Property.
(c) Fire, explo sion, discharge or release of any gas, vapor, liquid or any other substance, falling plaster, electricity or smoke, being or occurring on, at or in connection with the Property.
(d) Acts of Tenant or any subtenant, occupant, user, licensee or invitee of all or any part of the Property.
(e) Any latent defect in or condition of the Property or any Improvement or real or personal property, which at any time may be erected or situated thereon; provided that Landlord will be liable for a latent defect in the Property if Landlord knew of such latent defect and Landlord failed to disclose such latent defect to Tenant.
(f) The loss or theft of any property of Tenant or any other person at, on, or around the Property.
(g) The cessation, interruption, suspension, failure or inadequac y of any utilities furnished to the Property or any apparatus or appliance used in connection therewith.

Section 802 Discovery of Toxic Substances
During the term of this Lease, Landlord will have the right to terminate this Lease upon the discovery of any Hazardous Material which Landlord determines, in consultation with the holder of a Senior Loan, renders the Property unsuitable for its designated use without environmental mitigation measures which are determined by Landlord , in consultation with the holder of a Senior Loan, to be unacceptable, excessive, or unfeasible.

ARTICLE IX MAINTENANCE AND REPAIRS
Section 901 Maintenance and Repairs.

Tenant, at its own expense, will maintain and keep the Property and all Improvements thereon in good repair and in a decent, safe and sanitary condition, in accordance with the terms of the AHA, the Agreement Containing Covenants, and the HOME Regulatory Agreement .

Tenant will also make any repairs, structural or nonstructural, interior or exterior, to the Property 115 of 422
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made necessary by reason of alterations made by Tenant or by the acts or omissions of Tenant, or its employees, agents, subtenants, licensees, invitees or others, or by normal wear and tear, the elements, or other casualty or cause. R outine maintenance may be performed by Tenant without notice to or permission of Landlord.

Section 902 Repairs.

When used in this Section, the term “repairs” applies to all equipment, machinery, apparatus and fixtures of every kind used in connection with the operation and maintenance of the Property and all Improvements thereon and will be deemed to include replacements, restorations and renewals of the equipment, machinery, apparatus and fixtures. Tenant will have the right at any time and from time to time to remove and to dispose of the equipment, machinery, apparatus and fixtures; provided, however, that Tenant will promptly replace same with other equipment, machinery, apparatus or fixtures which are equally or more effective.

Section 903 Landlord’s Obligation.

The parties hereto intend that Landlord will have no obligation, in any manner whatsoever, to repair or maintain the Property, or any Improvements constructed thereon , or the equipment therein, whether structural or nonstructural. These obligations are the sole responsibility of Tenant. Tenant expressly waives the benefit of any statute now or hereinafter in effect which would otherwise afford Tenant the right to make repairs at Landlord’s expense or terminate this Lease because of Landlord’s failure to keep the Property in good order, condition and repair.

ARTICLE X DAMAGE OR DESTRUCTION
Section 1001 Tenant to Give Notice.

If there is any damage to or destruction of the Property or the Improvements, or any part thereof, in excess of an amount equal to Twenty Five Thousand Dollars ($25,000) escalated from the date of commencement of this Lease in accordance with the applicable consumer price index, Tenant will, within ten (10) days after Tenant becomes aware or reasonably should have become aware of such damage or destruction, give written notice thereof to Landlord, generally describing the nature and extent of such damage or destruction.

Section 1002 Repair of Damage or Destruction.
(a) Tenant covenants and agrees that in case of damage to or destruction of the Property or Improvements by any cause, it will, subject to the provisions of this Section, restore, repair, replace or rebuild the Property and Improvements as nearly as possible to the condition, quality and class they were in, immediately prior to such damage or destruction. Tenant will commence the restoration, repairs, replacement or rebuilding of the Improvements with such alterations and additions as may be approved by Landlord (such restoration repairs, replacement, rebuilding, alterations and additions, together with any temporary repairs and property protection pending completion of the work will be referred to hereinafter as “Restoration”) within thirty (30) days of such damage or destruction, plus any additional period reasonably required to obtain Net Insurance 116 of 422
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Proceeds (if any), as defined in subsection (b) below, to be used to pay all or a portion of the costs of such Restoration and will complete such Restoration within a reasonable time thereafter. (b) As used herein, the term “ Net Insurance Proceeds ” means the gross insurance proceeds paid by an insurer to Tenant for loss or damage to the Property and Improveme nts, less any and all costs and expenses (including, without limitation, reasonable attorney’s fees) incurred to recover said proceeds. Subject to the terms of the Senior Loan, Tenant agrees to promptly commence and prosecute to completion the settlement of insura nce proceeds with respect to an event of damage to or destruction of the Improvements or the Property. (c) Tenant agrees that, notwithstanding any other provision of this Lease, upon an event of damage or destruction to the Improvements, Tenant will at its sole cost and expense (whether or not Tenant terminates or intends to terminate this Lease pursuant to Section 1005 below) immediately take or cause to be taken such actions and complete such work as is necessary to assure the safe condition of the damaged Improvements pending their ultimate disposition. In any instance where Tenant has the right to terminate this Leas e, rather than restore the Improvements, if Tenant elects not to terminate this Lease, then Tenant must promptly restore the Improvements.
(d) Tenant will not be entitled to any compensation or damages from Landlord for loss of use of the whole or any part of Tenant’s Leasehold Estate or Tenant’s personal property, or any inconvenience or annoyance occasioned by damage, repair, reconstruction, or restoration of the Improvements. Tenant waives the provisions of clause 2 of California Civil Code section 1932 and clause 4 of California Civil Code section 1933, with respect to termination upon destruction of or damage to the Property or Improvements.

Section 1003 Application of Insurance Proceeds.

Insurance proceeds from policies of insurance carried under Section 1501 which are received on account of any damage to or destruction of the Property or the Improvements thereon, or any portion thereof, (les s the costs, fees and expenses incurred in the collection thereof, including without limitation, attorney’s fees and expenses), if Tenant does not make the election permitted in Section 1005 below, will be applied as follo ws, subject to the rights of Permitted Leasehold Mortgagees:
(a) Within a reasonable time and in any event within one hundred eighty (180) days after the damage to or destruction of the Property or the Improvements, Tenant will furnish, or cause to be furnished to Landlord and Permitted Leasehold Mortgagees evidence satisfactory to Landlord and each Permitted Leasehold Mortgagee, (a) of the total cost of Restoration of the damaged or destroyed Improvements, and (b) that the total amount of money available to Tenant will, when added to the insurance proceeds received and available to pay for the Restoration pursuant to the terms of this Section, be sufficient to pay the cost of such Restoration. (b) Net Insurance Proceeds received on account of any damage to or destruction of the Improvements, or any part thereof, will be paid to Tenant or as Tenant may direct from time to time as Restoration progresses, or to the holder of the Senior Loan, as set forth in the Senior Loan 117 of 422
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documents, solely to pay (or reimburse Tenant for) the cost of Restoration. Upon receipt by Landlord and Permitted Leasehold Mortgagees of evidence that Restoration has been completed and the cost thereof paid in full or has been adequately provided for, and that there are no mechanic’s or similar liens for labor or materials supplied in connection therewith, which have not been adequately provided for, the balance, if any, of such proceeds will be paid to Tenant.

Section 1004 Tenant’s Obligations.

If the Net Insurance Proceeds actually available to Tenant and recovered with respect to any insured damage or destruction, less the cost of recovery, are insufficient to pay the entire cost of such Restoration, Tenant covenants to use reasonable efforts to secure additional funding to remedy such insufficiency to restore, repair, replace or rebuild the Improvements.

Section 1005 Option to Terminate.

If at any time during the term of this Lease, any buildings or improvements located on the Property are destroyed , in whole or in part , by fire, theft, the elements, or any other cause (collectively hereinafter referred to as a “ Casualty”), then this Lease will continue in full force and effect; provided, however, that Tenant, subject to the rights of Permitted Leasehold Mortgagees, will have the option of terminating this Lease on the last calendar day of any month by giving Landlord at least thirty (30) days’ prior written notice of Tenant’s intent to do so and by removing, within one hundred twenty (120) days of the Casualty, at Tenant’s own cost and expense, all debris and remains of the damaged improvements from the Property, under the following circumstances:
(a) buildings or improvements located on the Property are so damaged or destroyed by a Casualty during the last five (5) years of the Term of this Lease that such buildings or improvements cannot be repaired and restored at a cost which is less than fifty percent (50%) of the cost to replace all of the buildings and improvements located on the Property if totally destroyed; or
(b) buildings or improvements located on the Property are damaged or destroyed by a Casualty at any time during the term of this Lease and either (i) insurance proceeds available to Tenant from the insurance required in Section 1501 or by a Permitted Leasehold Mortgagee are not sufficient to cover one hundred percent (100%) of the cost, less Two Hundred Fifty Thousand Dollars ($250,000), to repair and restore such damaged or destroyed buildings or improvements , or (ii) the damage or destruction results from a Casualty that is not required to be insured by Tenant under the terms of this Lease or a Leasehold Mortgage, and for which Tenant has not obtained such insurance , and the cost to repair and restore such damaged or destroyed buildings or improvements is more than Two Hundred Fifty Thousand Dollars ($250,000).

ARTICLE XI ENTRY BY LANDLORD
Landlord and its agents, representatives, employees and independent contractors will have the right, at all reasonable times and on prior reasonable notice, to enter the Property to ascertain whether Tenant is complying with its obligations under this Lease, the AHA, the Agreement 118 of 422
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Containing Covenants, and the HOME Regulatory Agreement and for any other purpose permitted under this Lease; provided, however, that such entry does not unnecessar ily or unreasonably disturb lawful occupants of the Property. Neither the right of entry reserved by this Article, nor the exercise thereof, will impose any responsibility or liability on Landlord for the care or supervision of the Property or Improvements on the Property.

ARTICLE XII UTILITIES AND SERVICES
Section 1201 Utilities and Services
Tenant, at its sole expense, will maintain or will cause to be maintained , all utility lines, whether located on or off the Property, servicing the Property. Tenant will pay promptly all assessments, deposits, rents, costs, connection and tap-in fees and other charges for the connection of utilities, including any fees or charges imposed by any utility company or governmental entity or agency for making such connections. Tenant expressly agrees that Tenant will pay all charges for fuel, gas, water, electricity, light, heat, power, telephone or other communication services, and all oth er utilities or services necessary to carry on the operations of the Tenant. Tenant will indemnify Landlord from, and defend and hold Landlord harmless against, any claim, liability, damage, loss, cost or expense in connection with such charges. Landlord may, after giving Tenant at least ten (10) business days’ notice and an opportunity to cure, pay or cause to be paid any items or charges which are delinquent. Thereafter, on demand by Landlord, Tenant will pay and reimburse Landlord for such items or ch arges, with interest at the highest rate allowed by law , from the date of payment by Landlord until Landlord is repaid in full by Tenant.

Section 1202 Easements
Landlord agrees, at the request of Tenant and at Tenant’s sole cost and expense (or at the expense of the utility company or other third party) , to join in the grant of easements over the Property that are necessary to obtain required utility services to the Project. Any such grant of an easement over the Property must be approved in writing by Landlord, which approval will not be unreasonably withheld.

ARTICLE XIII PROHIBITION AGAINST ENCUMBRANCE OR TRANSFER Section 1301 Prohibitions.
(a) The qualifications and identity of Tenant are of particular concern to Landlord. It is because of those qualifications and identity that Landlord has entered into this Lease with Tenant. No voluntary or involuntary successor in interest of Tenant will acquire any rights or powers under this Lease except as expressly set forth herein and in Article XXII. (b) Except for Permitted Transfers, Tenant will not assign or sublease all or any part of this Lease without the prior written approval of Landlord. Landlord agrees to reasonably give such approval if, in Landlord’s reasonable determination, the proposed reconstituted Tenant is comparable in all material respects (including experience, character and financial capability) to Tenant as of the date of this Lease. Any such change (or assignment or sublease of this Lease in 119 of 422
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connection therewith) will be subject to approval by Landlord’s Executive Director (or his/her designee) of evidence of the proposed assignee’s qualifications to meet Tenant’s obligations under this Lease and must be by instruments satisfactory to Landlord’s Executive Director (or his/her designee).
(c) For the reasons cited above, Tenant represents and agrees for itself and each successor in interest that, except for P ermitted Transfers, there will be no cumulative change in ownership interest of any general partner of greater than 49%, or with respect to the identity of the parties in control of Tenant or the degree thereof, by any method or means, without Landlord’s prior written approval.
(d) Tenant will promptly notify Landlord of any and all changes whatsoever in the identity of the parties in control of Tenant or the degree thereof, of which it or any of its officers have been notified or otherwise have knowledge or information. Landlord may exercise its remedies under this Lease, if there is any significant change (voluntary or involuntary) in membership, management or control of Tenant (other than such changes occasioned by the death or incapacity of any individual), except for Permitted Transfers. (e) Tenant will not, except for Permitted Transfers or as permitted by this Lease, initiate a Transfer without prior written approval of Landlord, except as expressly permitted by this Lease. Consent to one such transaction will not be deemed to be a waiver of the right to require consent to future or successive transactions. Any such proposed transferee will have the qualifications and financial responsibility necessary and adequate as may be reasonably determined by Landlord, to fulfill the obligations undertaken in this Lease by Tenant. Any such proposed transferee, by instrument in writing satisfactory to Landlord and in form recordable among the land records, for itself and its successors and assigns, and for the benefit of Landlord will expressly assume all of the obligations of Tenant under this Lease and agree to be subject to all conditions and restrictions applicable to Tenant in this Lease. There will be submitted to Landlord for review all instruments and other legal documents proposed to affect any such transfer; and if approved by Landlord, its approval will be indicated to Tenant in writing. Attempts to effectuate a Transfer, except for Permitted Transfers or as permitted by this Lease, without Landlord’s approval, will be null and void and any transferee under such attempted Transfer will acquire no right or interest by reason of such attempted Transfer. (f) Notwithstanding the foregoing, Tenant may: (i) lease the Units , in conformance with the Agreement Containing Covenants and the HOME Regulatory Agreement , without the written consent of Landlord; and (ii) enter into a management agreement with an entity approved in writing by Landlord, in its reasonable discretion, and approved by the Permitted Leasehold Mortgagees. WSH Management Inc., a California corporation, is approved as the initial management agent.
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Section 1302 Consent to Assignment
Subject to the limitations on transfer set forth in Section 1301, Landlord agrees it will not unreasonably withhold its consent to a proposed assignment of this Lease to an assignee if all of the following conditions are met:
(a) Tenant is not in default of any provision of this Lease, or any other agreement with Landlord or the City in connection with this Property;
(b) Landlord has issued the Release of Construction Covenants to Tenant and Conversion has occurred;
(c) Tenant has demonstrated to Landlord’s satisfaction in Landlord’s reasonable discretion that the proposed assignee is financially sound and possesses a reputation and experience in owning and managing low-income residential units that is at least comparable to that of Tenant. Any assignment of this Lease must be in writing and must be executed by the assignee and a duplicate original of such assignment and assumption must be delivered to Landlord as a condition of its effectiveness . The original named Tenant will not be relieved of its obligation pursuant to this Lease, the Agreement Containing Covenants, the HOME Regulatory Agreement, or the AHA; and
(d) The proposed assignee has agreed in the assignment and assumption agreement delivered to Landlord to assume, and be bound by, all of the terms, covenants, conditions and obligations of Tenant pursuant to this Lease, the Agreement Containing Covenants , the HOME Regulatory Agreement, and the AHA.

ARTICLE XIV TAXES AND IMPOSITIONS
Subject to Tenant’s right to claim any exemption to which it may be entitled under State law, Tenant will directly bear, pay and discharge all Taxes and Impositions (as defined below) before the first day on which a penalty or interest may accrue or be assessed thereon for nonpayment (or, if no penalty or interest thereon may accrue or be assessed, then before such Taxes and Impositions become delinquent or past due). “ Taxes” and “Impositions” mean and include all real property taxes, possessory interest taxes, personal property taxes and special assessments imposed, levied or assessed on the Property or Improvements thereon. Taxes and Impositions include all costs, expenses and charges of any kind whatsoever (whether foreseen or unforeseen) which may become due or owing with respect to all or any part of the Property during the term of this Lease. Taxes and Impositions include, without limitation, all ad valorem taxes and other assessments, water and sewage charges, and governmental impositions and charges of every kind and nature whatsoever, extraordinary as well as ordinary, which will or may during the Lease term be charged, laid, levied, assessed, imposed upon or become payable out of, or become liens upon, or arise in connection with the ownership, leasing, operation, use, occupancy, or possession of the Property or with respect to the privilege of entering into or holding this Lease, or leasing space within the Property, regardless of whether assessed or levied upon or payable by Tenant or Landlord. Pursuant to Health & Safety Code section 37001.5, and subject to Tenant’s right to claim 121 of 422
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any exemption to which it may be entitled under State law, Tenant will pay taxes on the assessed value of the entire Property and not merely on the assessed value of its Leasehold Interest.

In the event of nonpayment of any Tax or Imposition, Landlord may, after giving Tenant at least ten (10) business days’ notice of its intention to do so, pay or cause to be paid any item or items of Taxes and Impositions which are delinquent or past due. Tenant will pay and reimburse Landlord therefor when requested to do so by Landlord, and the same will become due and payable, with interest at the highest rate permissible by law from the date of Landlord’s payment of said Tax or Imposition, until Landlord is repaid in full by Tenant.

ARTICLE XV INSURANCE
Section 1501 Required Insurance
(a) Prior to the Construction Financing Event (except as provided in the next sentence), Tenant will furnish or cause to be furnished to Landlord evidence of the following policies of insurance, naming Tenant as insured and Landlord and the City as certificate holders and, except as to the insurance described in paragraph (iv), below, Landlord and the City as additional insureds.

The insurance requirements set forth in this Subsection (a) are subject to change prior to the Construction Financing Event, as needed to satisfy Landlord’s then-applicable requirements.

Evidence of insurance must include additional insured endorsements naming both Landlord and the City as additional insureds and including a primary insurance and waiver of contribution clause, a separation of insureds clause and a cancellation notice clause, in the form provided by Landlord. The insurance described in paragraph (ii) will be obtained prior to the initial rent-up of the apartments.
(i) Fire Policies: Tenant will maintain or cause to be maintained a policy or policies of insurance against loss or damage to the Property or the Improvements and all property of an insurable nature located upon the Property, resulting from fire, lightning, vandalism, malicious mischief, riot and civil commotion, and such other perils ordinarily included in extended coverage fire insurance policies. Such insurance will be maintained in an amount not less than one hundred percent (100%) of the full insurable value of the Improvements, as defined herein in paragraph
(c).
(ii) Rental Income Insurance: Tenant will maintain or cause to be maintained use and occupancy or business interruption or ren tal income insurance against the perils of fire, lightning, vandalism, malicious mischief, riot and civil commotion, and such other perils ordinarily included in extended coverage fire insurance policies, in an amount that is acceptable to Tenant and Landlord.
(iii) Liability Insurance: Tenant will maintain or cause to be maintained public liability insurance, to protect against loss from liability imposed by law for damages on account of personal injury, including death therefrom, suffered or alleged to be suffered by any person or persons whomsoever on or about the Property and the business of the Tenant on the Property, or in connection with the operation thereof, resulting directly or indirectly from any acts or activities 122 of 422
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of Tenant or its sublessees, or any person acting for Tenant , or under its respective control or direction, and also to protect against loss from liability imposed by law for damages to any property of any person occurring on or about the Property, or in connection with the operation thereof, caused directly or indirectly by or from acts or activities of Tenant or its tenants, or any person acting for Tenant , or under its control or direction. Such property damage and personal injury insurance will also provide for and protect Authority against incurring any legal cost in defending claims for alleged loss. Such personal injury and property damage insurance will be maintained in full force and effect during the term of the Authority Loan in the following amounts: commercial general liability in a general aggregate amount of not less than Two Million Dollars ($2,000,000); and not less than One Million Five Hundred Thousand Dollars ($1,500,000) of bodily injury and property damage insurance. It is the mutual intent of the parties that the levels of insurance coverage described herein will be and remain comparable to the level of insurance coverage that is customary with comparable operations in Los Angeles County. At any time during the term of the Authority Loan, and from time to time, either party may provide notice to the other party that the level of insurance being maintained by Tenant is no longer comparable to the level of insurance coverage that is customary with comparable operations in Los Angeles County, and request that the minimum limit hereinabove designated will be changed (either increased or decreased) accordingly. The party receiving such request will not unreasonably withhold its consent to such change. Tenant agrees that provisions of this paragraph as to maintenance of insurance will not be construed as limiting in any way the extent to which Tenant may be held responsible for the indemnification of Authority or the payment of damages to persons or property resulting from Tenant’s activities, activities of its tenants or the activities of any other person or persons for which Tenant is otherwise responsible. Tenant will require its insurer to waive its subrogation rights against Landlord and the City and will provide endorsements evidencing same. (iv) Workers’ Compensation Insurance
: Tenant will maintain or cause to be
maintained workers’ compensation insurance issued by a responsible carrier authorized under the laws of the State of California to insure employers against liability for compensation under the workers’ compensation laws now in force in California, or any laws hereafter enacted as an amendment or supplement thereto or in lieu thereof. Such workers’ compensation insurance will cover all persons employed by Tenant in connection with the Property and will cover liability within statutory limits for compensation under any such act aforesaid, based upon death or bodily injury claims made by, for or on behalf of any person incurring or suffering injury or death in connection with the Property or the operation thereof by Tenant . Notwithstanding the foregoing, Tenant may, in compliance with the laws of the State of California and in lieu of maintaining such insurance, self-insure for workers’ compensation in which event Lessee will deliver to Authority evidence that such self-insurance has been approved by the appropriate State authorities. If Tenant is required to maintain Workers’ Compensation Insurance under this paragraph, Tenant will furnish Landlord with a certificate of waiver of subrogation under the ter ms of the Workers’ Compensation Insurance. Tenant will require its general contractor to waive subrogation and will require that its subcontractors waive subrogation to the extent that such a waiver is commercially available.
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(b) All policies hereunder will not be subject to cancellation, reduction in coverage, or non-renewal except after notice in writing will have been sent by registered mail addressed to Landlord and the City not less than thirty ( 30) days in advance of the effective date, except for cancellation for nonpayment of premium, in which event notice will be given not less than ten days in advance of the effective date. All policies will name Landlord, Tenant and/or any general contractor as insureds, additional insureds, and/or loss payable parti es as their interests may appear.
(c) The term “full insurable value” as used in this Section 1501 means the actual replacement cost (excluding the cost of excavation, foundation and footings below the lowest floor and without deduction for depreciation) of the Improvements on the Property immediately before such casualty or other loss, including the cost of construction, architectural and engineering fees, and inspection and supervision. To ascertain the amount of coverage required, Tenant will cause the full insurable value to be determined from time to time by appraisal by the insurer, by the insurer’s automatic inflationary measure if acceptable to the Tenant and Landlord, by agreement between Tenant and Landlord or by an appraiser mutually acceptable to Landlord and Tenant, not less often than once every three years.
(d) All insurance provided under this Section 1501 will be for the benefit of Tenant, Landlord and City. Tenant agrees to timely pay all premiums for such insurance and, at its sole cost and expense, to comply and secure compliance with all insurance requirements necessary for the maintenance of such insurance. Tenant agrees to submit policies of all insurance req uired by this Section 1501, or certificates and endorsements evidencing the existence thereof, to Authority within 30 days prior to the Construction Financing Event, indicating full coverage of the contractual liability imposed hereby. Within thirty (30) days, if practicable, but in any event prior to expiration of any such policy, copies of renewal policies, or certificates evidencing the existence thereof, will be submitted to Landlord. All insurance herein provided for under this Section 1501 will be effected under policies issued by insurers of recognized responsibility, licensed or permitted to do business in the State of California reasonably approved by Landlord. (e) Tenant must cause all contractors and subcontractors performing work relating to the Project to maintain, at a minimum, the liability insurance and workers compensation insurance described in this Section 1501. Tenant must also cause its architects and engineers to maintain Architects and Engineers Professional Liab ility (Errors and Omissions) insurance on a “claims made basis” in an amount of not less $1,000,000. When coverage is provided on a “claims made basis”, Tenant must cause all contractors and subcontractors to continue to renew the insurance for a period of five (5) years after the end of the Construction Period. Such insurance must have the same coverage and limits as the policy that was in effect during the Construction Period, and cover Tenant for all claims made by Landlord arising out of any acts or omissions of Tenant, or its officers, employees or agents during the Construction Period. 124 of 422
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(f) If Tenant fails or refuses to procure or maintain insurance as required by this Agreement, Landlord will have the right, at Landlord’s election, and upon ten (10) days prior notice to Tenant, to procure and maintain such insurance. The premiums paid by Landlord will be treated as a loan, due from Tenant , to be paid on the first day of the month following the date on which the premiums were paid. Landlord will give promp t notice of the payment of such premiums, stating the amounts paid and the name of the insured(s).

Section 1502 Disposition of Insurance Proceeds
(a) Subject to the provisions of subsection (b) below, proceeds of insurance with respect to loss or damage to the Improvements to be maintained and repaired by Tenant during the Lease Term will be payable, under the provisions of the policy of insurance, to Tenant, or, if such loss or damage involves the need for Tenant to obtain any governmental approvals or permits, jointly to Tenant and Landlord, and said proceeds will constitute a trust fund to be used for the repair, restoration or reconstruction of the Improvements in accordance with plans and specifications approved in writing by Landlord.
(b) Notwithstanding the foregoing paragraph, within the period during which there is an outstanding Permitted Leasehold Mortgage on all or part of the Property and Improvements, distribution of said proceeds will be subject to the prior rights of such Permitte d Leasehold Mortgagees.
(c) If this Lease is terminated by mutual a greement of Landlord and Tenant and the Improvements are not repaired, restored or reconstructed, the insurance proceeds will be applied first to payments due under this Lease from Tenant to Landlord, second to restore the Property to a neat and clean condition, and finally any excess will be paid to Tenant. Provided, however, that within any period when there is a Permitted Leasehold Mortgage in effect, such proceeds will be applied first to discharge the debt secured by such mortgage and then for the purposes and in the order set forth above in this paragraph.
(d) Tenant hereby waives any claim against Landlord, the City of Glendale, and their respective members, officers, agents, employees and volunteers, for any loss covered by insurance of the type specified in Section 1501; and Tenant will obtain from its insurance company or companies a waiver of any right of subrogation that it may otherwise have against Landlord or the City.

ARTICLE XVI DEFENSE, INDEMNIFICATION AND HOLD HARMLESS Tenant hereby agrees , to the fullest extent of the law, to defend, indemnify and hold harmless Landlord, the City of Glendale, and their respective members, officers, agents, employees and volunteers (hereinafter collectively referred to as “Indemnitees ”) from and against any and all loss, damage, cost, expens e, liability, claims, demands, suits, reasonable attorneys’ fees and judgments arising directly or indirectly from or in any manner connected to Tenant’s possession, occupancy or use of the Property or arising from or in any manner connected to Tenant’s business, 125 of 422
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activities, operations, services or work conducted in, on or about the Property regardless of any active or passive negligence by any or all Indemnitees, except as otherwise stated herein.

Tenant further agrees to indemnify, defend and hold harmless Indemnitees from and against all loss, damage, costs, expense, liability, claims, demands, suits, reasonable attorneys’ fees and judgments arising from or in any manner connected to the furnishing or supplying of any work, services, materials, equipment or supplies to Tenant or on Tenant’s behalf by any persons, firms, corporations or other entities in, on or about the Property.

Without limiting the generality of the foregoing, Tenant agrees that Indemnitees will not be liable for any injury to Tenant’s business or any loss of income therefrom, or for damage to the goods, wares, merchandise, improvements or other property of Tenant, or to Tenant’s officers, agents, employees, invitees, customers, contractors, or any other person in, on or about the Property or for damages to any of Tenant’s officers, agents, employees, invitees, customers or contractors.

Indemnitees will be entitled to recovery of attorney’s fees incurred as a result of Tenant’s failure to provide the defense and indemnity required by this Article XVI. This Article XVI will survive the expiration or termination of this Lease.

ARTICLE XVII EMINENT DOMAIN
Section 1701 Tenant to Give Notice
In case of a taking of all or any part of the Property and Improvements through the exercise of the power of eminent domain (“ Taking”), or the commencement of any proceedings or negotiations which might result in such Taking, Tenant will promptly give written notice thereof to Landlord, generally describing the nature and extent of such Taking or the nature of such proceedings or negotiations, and the nature and extent of the Taking which might result therefrom, as the case may be.

Section 1702 Total Taking
In case of a Taking of the entire Property and Improvements, or in case of the taking of only a part of the Property and Improvements, leaving the remainder of the Property and Improvements in such location, or in such form, shape or reduced size as to render the same not effectively and practicably usable for the conduct thereon of the uses permitted hereunder, this Lease will terminate as of the date title vests in the condemning authority or the date the condemning authority is entitled to possession, whichever first occurs (the “Date of Taking”). A Taking of the Property and Improvements of the character referred to in this Section that results in the termination of this Lease is referred to herein as a “Total Taking.” Section 1703 Partial Taking
In case of a Taking of the Property and Improvements other than a Total Taking (a “Partial Taking”), (i) this Lease will remain in full force and effect as to the portion of the Property and Improvements remaining immediately after such Partial Taking, without any abatement or 126 of 422
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reduction of any sum payable hereunder, and (ii) Tenant, to the extent the awards or payments, if any, on account of such Partial Taking will be sufficient for the purpose, at its expense, but first subject to Section 1704 (a), will within a reasonable period of time commence and complete, or cause to be commenced and completed, Restoration of the Property and Improvements as nearly as possible to its value, condition, and character immediately prior to such Partial Taking, with such alterations and additions as may be made at Tenant’s election pursuant to and subject to the terms of Section 701, except for any reduction in area caused thereby; provided, however, that in case of a Partial Taking for temporary use Tenant will not be required to effect Restoration until such Partial Taking is terminated.

Section 1704 Application of Awards and Other Payments
Awards and other payments on account of a Taking, less costs, fees and expenses incurred in the collection thereof (“Net Awards and Payments”) will be applied as follows:
(a) In case of a Taking other than a Total Taking or a Taking for temporary use, Tenant will furnish to Landlord and Permitted Leasehold Mortgagees evidence satisfactory to Landlord and such mortgagees of the total cost of the Restoration required by Section 1703. (b) Net Awards and Payments received on account of a Taking other than a Total Taking or a Taking for temporary use will be held and applied as provided with respect to proceeds of insurance in Section 1502. The balance, if any, will be paid to Tenant and Landlord as their respective interests may appear in the Property and the Improvements. (c) Net Awards and Payments received on account of a Total Taking will be allocated as follows:

First
: There will be paid to each Permitted Leasehold Mortgagee, in the order of its priority, an amount equal to the sum of any unpaid principal amount of the indebtedness secured by the Permitted Leasehold Mortgage, and any interest accrued thereon, all as of the date on which such payment is made; provided, however, that each such Permitted Leasehold Mortgagee will only be paid to the extent of its security in the applicable portion which is the subject of the Taking.

Second: To Tenant and Landlord , as their respective interests may appear in the Property and the Improvements; provided, that payment s to Permitted Leasehold Mortgagees or pursuant to the preceding paragraph will be charged against Tenant’s interest.

ARTICLE XVIII COMPLIANCE WITH ALL LAWS
Tenant will conduct its operations in compliance with all applicable state or federal laws, and with all ordinances, rules and regulations, in effect or hereinafter adopted by the City of Glendale, the County of Los Angeles, the State of California and the United States.

ARTICLE XIX PERMITS AND LICENSES
Tenant will, at its sole cost and expense, obtain and maintain during the Term of this Lease, all appropriat e licenses, permits and certificates that may be required in connection with the 127 of 422
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construction of the Improvements, and the operation of the Project , and the provision of services hereunder.

ARTICLE XX PRODUCTION OF REPORTS, RECORDS AND STATEMENTS Tenant will maintain such records as are reasonably required by Landlord to verify compliance with the terms of this Lease, the AHA, the Agreement Containing Covenants, and the HOME Regulatory Agreement . Tenant will, within ten (10) business days of their receipt or completion, submit copies to Landlord of all annual budgets, financial statements, audits and all other reports, records and statements that pertain to or are in any manner connected with the Property. The records, reports, statements and other documents of Tenant that pertain to or are in any manner connected with the Property will be available for inspection and copying by Landlord during normal business hours, but will be kept confidential by Landlord and will not be disclosed to any other person without Tenant’s prior written approval, except as may be otherwise required by law. Tenant will pay to Landlord the required fees in connection with affordability monitoring and reporting.

ARTICLE XXI NONDISCRIMINATION
Tenant covenants and agrees for itself, its successors, its assigns and every successor in interest to the Property or any part thereof or interest therein, there will be no discrimination against or segregation of any person, or group of persons, on account of sex, sexual orientation, marital status, race, color, creed, religion, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor will Tenant, itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees of the Property. All deeds, leases or contracts will contain or be subject to substantially the following nondiscrimination or nonsegregation clauses:

1. In deeds: “The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through them, that there will be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor will the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees , subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants will run with the land.”
Notwithstanding the preceding paragraph, the provisions relating to discrimination on the basis of familial status will not be construed to apply to housing for older 128 of 422
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persons, as defined in Section 12955.9 of the Government Code nor be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code will also apply to the preceding paragraph.

2. In leases: “The Tenant herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions:

That there will be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor will the Tenant himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees in the premises herein leased.” Notwithstanding the preceding paragraph, the provisions relating to discrimination on the basis of familial status will not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code nor be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code will also apply to the preceding paragraph.

3. In contracts: There will be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the land, nor will the transferee itself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees , sublessees, subtenants, or vendees of the land.”
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ARTICLE XXII LEASEHOLD MORTGAGES
Section 2201 Leasehold Mortgages
Other than Permitted Leasehold Mortgages, Tenant may not grant a Leasehold Mortgage without Landlord’s prior written consent.

Section 2202 No Subordination
Landlord’s reversionary fee interest in the Property and Landlord’s rights and interests, as lessor, in the Property and this Lease, including without limitation Landlord’s right to receive payments and reimbursements from Tenant, will not be subordinated to the rights of the holder of any lien, mortgage or security interest (including without limitation, the rights of any Leasehold Mortgagees) granted by Tenant.

Section 2203 Notice to Landlord
Tenant will require each Permitted Leasehold Mortgagee to give Landlord the right to receive notices of an event of default by Tenant under the applicable Leasehold Mortgage and the right to cure such default in the same period of time as is given to Tenant thereunder plus an additional ten (10) business days with respect to those defaults that are curable; provided that during such ten business day period, the Permitted Leasehold Mortgagee will have the right to commence, but not complete its remedies on account of such default. If and to the extent Tenant fails to cure such default, and Landlord exercises its right to cure the same, Tenant will reimburse Landlord for al l of Landlord’s reasonable costs and expenses, including without limitation reasonable attorneys’ fees. Landlord may record in the Official Records of Los Angeles County a request for notice of default.

Section 2204 Notice to Permitted Leasehold Mortgagee
Landlord will mail to each Permitted Leasehold M ortgagee a duplicate copy of notices Landlord may from time to time give to or serve on Tenant , pursuant to or relating to this Lease.

Tenant will at all times keep Landlord informed in writing of the name and mailing ad dress of such Permitted Leasehold Mortgagee s and any changes in such m ortgagee’s mailing address.

Notices or other communications permitted by this or any other Section of this Lease , or by law, to be served on or given to Permitted Leasehold Mortgagees by Landlord, will be deemed duly served on or given to mortgagees by deposit in the United States mail, certified, return receipt requested or by overnight courier, return receipt, addressed to such mortgagees at the last mailing address furnished in writing to Landlord by Tenant or by such mortgagee. The date of notice will be the date marked on the return receipt.

Section 2205 Permitted Leasehold Mortgagee’s Rights
Permitted Leasehold Mortgagees will have the right, but not the obligation, without further consent of Landlord, at any time during the Term of this Lease to:
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(a) Do any act or thing required of Tenant under this Lease, and such act or thing done and performed by a Permitted Leasehold Mortgagee will be as effective to prevent a forfeiture or loss of Tenant’s rights under this Lease as if done by Tenant itself; (b) Do any act or thing required of Tenant, and enforce the obligations of Tenant, under any regulatory agreement recorded against Tenant’s leasehold estate in connection with the Permitted Leasehold Mortgage;
(c) Transfer, convey or assign the right, title and interest of Tenant in and to the leasehold estate created by this Lease to a purchaser at a foreclosure sale, whether the foreclosure is conducted pursuant to court order or pursuant to a power of sale contained in a Permitted Leasehold Mortgage; and
(d) Acquire and succeed to the right, title and interest of Tenant under this Lease by virtue of a foreclosure proceeding, whether the foreclosure is conducted pursuant to a court order or pursuant to a power of sale contained in a Permitted Leasehold Mortgage, or by virtue of a transfer in lieu of foreclosure (“Foreclosure”) and, following such Foreclosure, transfer, convey or assign the right, title and interest of Tenant in and to the leasehold est ate granted by this Lease to a third party.

Section 2206 Obligations of Permitted Leasehold Mortgagee Upon Acquisition of Leasehold Estate
If the holder of a Permitted Leasehold Mortgage, or another party through a Foreclosure, acquires the leasehold estate created hereunder or otherwise acquires possession of the Property and Improvements pursuant to available legal remedies, Landlord will look to such holder to perform the obligations of Tenant hereunder from and after the dat e of Foreclosure or possession and will not hold such holder responsible for the past actions or inactions of Tenant.

Notwithstanding the foregoing, (i) on and after the date of such F oreclosure or possession, such holder will be required to perform and a bide by each and every obligation of Tenant under this Lease; and (ii) on and after the date of such Foreclosure or possession, Landlord will have the right to enforce each and every provision of this Lease against such holder. Nothing herein is intended or will be construed to limit or restrict Landlord’s rights and remedies against Tenant, provided that Landlord’s pursuit of such remedies will not affect the rights of Permitted Leasehold Mortgagee to the use, enjoyment or operation of the Property and Improvements.

Section 2207 No Modification or Termination of Lease Without Permitted Leasehold Mortgagee’s Consent
Tenant and Landlord hereby express ly stipulate and agree , except for the California Tax Credit Allocation Committee Lease Rider and Estoppel Agreement (Tax Credits) (“TCAC Rider”)to be entered into in association with the recording of the Regulatory Agreement between Tenant and the California Tax Credit Allocation Committee (the “TCAC”), that they will not modify this Lease in any way nor cancel or terminate this Lease by mutual agreement , nor will Tenant surrender its interest in this Lease, without the prior written consent of Permitted Leasehold Mortgagees and Tenant’s Investor Limited Partner. Tenant and Landlord further agree that each 131 of 422
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will not take advantage of any provisions of the United States Bankruptcy Code that would result in a termination of this Lease or make it unenforceable. At the time required by TCAC, Tenant and Landlord agree to execute and record against the Premises in the official records of the County of Los Angeles a lease rider in the form required by TCAC with such revisions to the lease rider requested by Landlord and agreed to by TCAC.

Section 2208 Right of Permitted Leasehold Mortgagee to Cure Default Before Landlord may terminate this Le ase because of a default under or breach of this Lease by Tenant, Landlord must ( i) give written notice of the default or breach (the “ Initial Default Notice”), and (ii) give written notice of the failure of Tenant to cure the default or breach (the “Second Default Notice”) , to Permitted Leasehold Mortgagee concurrently with the transmittal of such notices to Tenant , and afford the Permitted Leasehold Mortgagee the opportunity to:
(a) Cure the breach or default (including payment of all accrued and delinquent Rent) at any time prior to the sixtieth ( 60th) day after service on Leasehold Mortgagee of the Second Default Notice, where the default can be cured by the payment of money to Landlord or another person;
(b) Cure the breach or default within ninety (90) days after service on Leasehold Mortgagee of the Second Default Notice, where the breach or default must be cured by something other than the payment of money and can reasonably be cured within that time; or (c) Cure the breach or default in such reasonable time as may be required where something other than the payment of money is required to cure the breach or default and cannot be reasonably cured within ninety (90) days after service on Leasehold Mortgagee of the Second Default Notice, provided that acts to cure the breach or default are commenced within that time period after service of the Second Default Notice on Leasehold Mortgagee by Landlord and are thereafter diligently continued by Leasehold Mortgagee.

If, to complete the cure of the default or breach, a Permitted Leasehold Mortgagee requires access to the Property and Project , the foregoing cure period will not commence until such Leasehold Mortgagee obtains possession of the property, provided that such Leasehold Mortgagee diligently seeks to obtain such possession by a foreclosure action or otherwise and diligently pursues such action all within the time periods set forth in Section 2302 below, or such longer period approved by Landlord. If a Permitted Leasehold Mortgagee completes the cure of the default or breach in a timely and proper manner, Landlord will accept the cure as fulfilling the terms of this Lease.

Section 2209 Foreclosure in Lieu of Curing Default
Notwithstanding any other provision of this Lease, a Permitted Leasehold Mortgagee may forestall termination of this Lease by Landlord for a default under or breach of this Lease by Tenant, by commencing proceedings to foreclose its Permitted Leasehold Mortgage, whether the foreclosure is conducted pursuant to a court order or pursuant to a power of sale contained in a Permitted Leasehold Mortgage, or by virtue of a transfer in lieu of for eclosure. Commencement 132 of 422
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of the foreclosure will not, however, forestall termination of this Lease by Landlord for the default or breach by Tenant unless:
(a) It occurs within sixty (60) days after service on Permitted Leasehold Mortgagee of the Second Default Notice or such longer period as approved by Landlord; (b) It is diligently pursued; and
(c) Permitted Leasehold Mortgagee keeps and performs all of the terms, covenants and conditions of this Lease which it is capable of performing (including the payment of Rent, including past due Rent, under this Lease) requiring the payment or expenditure of money by Tenant, accruing after commencement of the f oreclosure, until the f oreclosure is complete or is discharged by redemption, satisfaction, payment or conveyance of the leasehold estate to Permitted Leasehold Mortgagee.

Section 2210 Assignment of Lease Upon Foreclosure
Provided that a Permitted Leasehold Mortgagee gives written notice of transfer to Landlord setting forth the name and address of the transferee as well as the effective date of the transfer, the written consent of Landlord will not be required for transfer of Tenant’s right, title and interest under this Lease to:
(a) a purchase r, which may include the Permitted Leasehold Mortga gee, at a foreclosure sale of the Leasehold Mortgage, whether the foreclosure is conducted pursuant to court order or pursuant to a power of sale in the instrument creating the Leasehold Mortgage; or (b) a purchaser from the Permitted Leasehold Mortgagee after foreclosure, where the Permitted Leasehold Mortgagee was the purchaser of Tenant’s interest at the foreclosure sale of the Leasehold Mortgage or acquired Tenant’s interest by transfer in lieu of foreclosure. The purchase from the Permitted Leasehold Mortgagee will be subject to all the terms and conditions of this Lease. The Permitted Leasehold Mortgagee, the purchaser at a foreclosure sale, or the purchaser from the Permitted Leasehold Mortgagee will be subject to all the terms and conditions of this Lease except that (i) the time for performance of any unperformed acts required by Article VI of this Lease will be extended for a period equal to the delay in performance of the act caused by Tenant’s inability or failure to perform the act and the time required to transfer the Lease to the purchaser at a foreclosure sale and/or to the purchaser from Permitted Leasehold Mortgagee, (ii) the performance of acts required by this Lease that have already been performed and purchaser’s liability for acts or inactions of the original Tenant will be excused; provided, however, that on and after the date of such possession, (1) the purchaser will be obligated to bring the management and maintenance of the Project into compliance with the Agreement Containing Covenants and the HOME Regulatory Agreement; and (2) Landlord will have the right to enforce each and every provision of this Lease against such purchaser with respect to matters arising or continuing after such date of possession, and (iii) Permitted Leasehold Mortgagee will be able to absolutely assign or transfer this Lease regardless of the date of the assignment and any purchaser, assignee or transferee of this Lease from Permitted Leasehold Mortgagee will be able to assign this Lease without the approval or consent of Landlord regardless of the date of the assignment. 133 of 422
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(c) No Permitted Leasehold Mortgagee shall be responsible for any liability, costs or expenses which occur or accrue under this L ease after such Permitted Leasehold M ortgagee transfers its interest in this Lease.

Section 2211 New Lease to Permitted Leasehold Mortgagee Notwithstanding any other provision of this Lease, if this Lease terminates for any reason, including without limitation, the insolvency or bankruptcy of Tenant , then Landlord will, within thirty (30) days after the request set forth in Subsection (a) below is received, execute and deliver a new Lease for the Property and Project to the Permitted Leasehold Mortgagee, provided:
(a) A written request for the new Lease is served on Landlord by Permitted Leasehold Mortgagee within sixty (60) days after service on Permitted Leasehold Mortgagee of notice that the Lease has terminated; and, Landlord agrees to give Permitted Leasehold Mortgagee notice of such termination.
(b) The new Lease (i) is for a term ending on the same date the term of this Lease would have ended had not this Lease been terminated, and ( ii) contains the same covenants, conditions and provisions as are contained in this Lease, except that the Permitted Leasehold Mortgagee will be able to absolutely assign or transfer the new Lease regardless of the date of the assignment and a purchaser, assignee or transferee of the Lease from Permitted Leasehold Mortgagee will be able to assign or transfer the Lease without the approval or consent of Landlord regardless of the date of the assignment.
(c) After termination of the Lease but before the expiration of the period within which Permitted Leasehold Mortgagee has to request and receive a new Lease, Landlord will not terminate existing subleases under which sublessee is not in default, or enter into new subleases for the Property or Project , and Landlord will account to Permitted Leasehold Mortgagee for all subtenant rents during such period.
(d) The new Lease will be subject to all existing subleases under which each such subtenant is not in default and will be assignable by Permitted Leasehold Mortgagee without further approval or consent by Landlord provided the conditions of this Section are satisfied. (e) The new Lease will:
(i) Extend the time for performance of unperformed acts required by Article VI of this Lease for a period equal to the delay in performance of the act caused by Tenant’s inability or failure to perform the act, and the time required to terminate this Lease, execute a new Lease to Permitted Leasehold Mortgagee , and Permitted Leasehold Mortgagee’s timely assignment of such new Lease; and
(ii) Excuse the performance of an act required by Article VI of this Lease that has alread y been performed and excuse the new Tenant from acts or inactions of the original Tenant; provided, however, that on and after the date of such possession, (i) the new Tenant will 134 of 422
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be obligated to bring the management and maintenance of the Project into com pliance with the Agreement Containing Covenants and the HOME Regulatory Agreement ; and (ii) Landlord will have the right to enforce each and every provision of the new Lease with respect to matters arising or continuing after the date of the new Lease, including but not limited to Article VI , against the new Tenant; and provided further, that Permitted Leasehold Mortgagee and its assignee as Tenant under the new Lease, will be liable for removal or bonding of all mechanic’s liens, stop notices, materialmen’s liens, or any liens for goods, labor, material, services or work manufactured for, delivered to, or performed on, the Property.
(iii) The new Lease and the Permitted Leasehold Mortgage will have the same priority as the original Lease and the Permitted Leasehold Mortgage on the original Lease, and intervening liens will not have priority over the new Lease or Permitted Leasehold Mortgage. (iv) Permitted Leasehold Mortgagee, on execution of the new Lease, will pay to Landlord all of Landlord’s reasonable costs and expenses, including reasonable attorney’s fees and court costs incurred in terminating this Lease, recovering possession of the Property and Project from Tenant, and preparing the new Lease.

Section 2212 No Merger of Estates
During the existe nce of any Permitted Leasehold Mortgage, if the same person or entity holds the leasehold estate created by this Lease and Landlord’s reversionary interest or fee interest in the Property, such estates will remain separate and there will be no merger without the consent of each Permitted Leasehold Mortgagee.

Section 2213 Amendments for Benefit of Permitted Leasehold Mortgagee Landlord and Tenant will cooperate in including in this Lease, by suitable amendment from time to time, provisions which may reasonably be requested by a Permitted Leasehold Mortgagee or proposed Permitted Leasehold Mortgagee for the purpose of implementing the mortgagee - protection provisions contained in this Article and allowing such Permitted Leasehold Mortgagee reasonable means to protect or preserve its Permitted Leasehold Mortgage on the occurrence of a default under the terms of this Lease; provided, however, that such amendment will not have a material adverse effect on Landlord’s rights or obligations under this Lease. Landlord and Tenant each agree to execute and deliver (and to acknowledge, if neces sary for recording purposes) any agreement necessary to effect such amendment.

Section 2214 Restriction on Landlord’s Right to Encumber its Interest Landlord will not mortgage, hypothecate, pledge or encumber its interest in the Property or any part thereof without the prior written consent of the holder of a Senior Leasehold Mortgage, unless there is an express recognition of Tenant’s rights under this Lease and subordination of the new lender’s lien on Landlord’s interest in the Property to this Lease, which subordination will be in a form acceptable to Tenant and the holder of such Senior Leasehold Mortgage. 135 of 422
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Section 2215 Restriction on Subordination of Tenant’s Interest Any subordination or attempted subordination of this Lease by Tenant to a mortgage, deed of trust, encumbrance or other security interest in Landlord’s interest in the Property or any part thereof will be void ab initio and will have no force or effect unless first agreed to in writing by the holder of a Senior Leasehold Mortgage.

Section 2216 Multiple Leasehold Mortgages
Where there is a right herein to be exercised by a Permitted Leasehold Mortgagee and there exists more than one Permitted Leasehold Mortgage, the right may be exercised in the order of priority of each Permitted Leasehold Mortgage.

ARTICLE XXIII EVENTS OF DEFAULT
The occurrence of one or more of the events described below will constitute a material default and a breach of this Lease, entitling Landlord to terminate this Lease prior to the expiration of the Term.

Section 2301 Events of Default
The following will constitute an “Event of Default” by Tenant:
(a) Subject to Force Majeure Delays and other provisions of this Lease that may modify the provisions hereof, failure by Tenant to commence or to complete construction of the Improvements according to the scheduled time periods set forth in the Schedule of Performance, and in accordance with the drawings delivered to Landlord and the Scope of Development. (b) After Tenant commences construction of the Improvements on the Property, Tenant’s abandonment of the Project for a period of thirty (30) days or more. (c) Tenant’s failure to p erform or to comply with the covenants , conditions and obligations set forth in this Lease and such failure is not cured within the time provided for herein. (d) Except as expressly permitted in this Lease, an attempted Transfer, without the prior written consent of Landlord.
(e) The sale of Tenant’s interest in the Property or any portion thereof, under attachment, execution or similar legal process; or Tenant is adjudicated as bankrupt or insolvent, or an order for relief is entered against Tenant under Federal Bankruptcy Code , a nd such adjudication or order is not vacated within ten (10) days. (f) The commencement of a case under any chapter of the Federal Bankruptcy Code, by or against Tenant or any guarantor of Tenant’s obligations hereunder, or the filing of a voluntary or involuntary petition proposing the adjudication of Tenant or any guarantor of Tenant’s obligations hereunder as bankrupt or insolvent, unless the same is dismissed within ninety (90) days.
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(g) The appointment of a receiver or trustee for the business or property of T enant (except by a Permitted Leasehold Mortgagee) or any guarantor of Tenant’s obligations hereunder, unless such appointment is vacated within ten (10) days of its entry. (h) The discovery by Landlord that any financial statement or other material financial information delivered by Tenant to Landlord is materially false as of the date delivered. (i) The occurrence of any other event described as constituting an “Event of Default” elsewhere in this Lease that is not cured within the time provided for herein.

Section 2302 Procedures for Declaring an Event of Default (a) Landlord will give written notice of default to Tenant, specifying the default complained of. Failure or delay in giving such notice will not constitute waiver of a default, nor will it change the time of default. Except as otherwise expres sly provided in this Lease, failures or delays by Landlord in asserting any of its rights and remedies as to a default will not operate as waiver of the default or of such rights or remedies. Dela ys by Landlord in asserting any of its rights and remedies will not deprive Landlord of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert, or enforce such rights or remedies. (b) If a monetary event of default occurs, prior to exerci sing its remedies hereunder, Landlord will give Tenant and the Investor Limi ted Partner concurrent written notice of such default. Tenant will have a reasonable period of time after such notice is given within which to cure the default prior to exercise of remedies by the Landlord under this Lease. In no event will Landlord be precluded from exercising remedies if its security becomes or is about to become materially impaired by a failure to cure a default or the default is not cured within ten (10) calendar days after the notice of default is received or deemed received. (c) If a non- monetary event of default occurs, prior to exercising its remedies hereunder, Landlord will give Tenant written notice of such default. If the de fault is reasonably capable of being cured within thirty (30) days, Tenant will have such period to effect a cure prior to exercise of remedies by Landlord. If the default is such that it is not reasonably capable of being cured within thirty (30) days, and Tenant (i) initiates corrective action within said period, and (ii) diligently, continually, and in good faith works to effect a cure as soon as possible, then Tenant will have such additional time as is reasonably necessary to cure the default prior to Landlord’s exercise of its remedies. If Tenant fails to take corrective action or cure the default within a reasonable time, Landlord will give Tenant and, as provided in paragraph (d), below, the Investor Limited Partner, notice thereof, whereupon the Investor Limited Partner may remove and replace the general p artner with a substitute general partner, who will effect a cure within a reasonable time thereafter, in accordance with the foregoing provisions. Landlord agrees to accept cures tendered by the Investor Limited Partner within the cure periods provided in this Lease or within the time periods provided in Civil Code Section 2924c, whichever is longer. Additionally, if the Investor Limited Partner is precluded from curing a non- monetary default due to its inability to remove the general p artner as a result of a bankruptcy, injunction, or similar proceeding by or against Tenant or its general partner, Landlord agrees to forbear from terminating this Lease during 137 of 422
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the period during which the Investor Limited Partner is so precluded from acting, not to exceed ninety (90) days, provided such limited partner is otherwise in compliance with the foregoing provisions. In no event will Landlord be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by a failure to cure a default or the default is not cured within one hundred eighty (180) days after the first notice of default is given. (d) Landlord will send the Investor Limited Partner a copy of all notices of default and all other notices that Landlord sends to Tenant, at the address for the Investor Limited Partner provided in Article XXVI .

ARTICLE XXIV REMEDIES
Upon, or at any time after , the declaration of an Event of Default (following all applicable notice and cure periods) , and if permitted hereunder, the following remedies describe d in this Article XXIV will apply.

Section 2401 Right of Termination
Landlord will have the right to terminate this Lease and Tenant’s right to possession of the Property by giving notice of such termination to Tenant. Upon the date of the giving of such notice (or, if such notice specifies a later date for such termination, then upon such later date), this Lease and Tenant’s right to possession hereunder and all of Tenant’s right, title and interest hereunder , in and to the Property and Improvements , will expire and terminate on such date. Landlord will be entitled to recover from Tenant all damages proximately caused by such default. In the event of termination of this Lease, Landlord will have the option of assuming the exi sting master tenancies and sub-tenancies, if any.

Section 2402 Transfer of Interest Upon Termination
If Landlord terminates this Lease as provided above, all of the right, title, estate and interest of Tenant in and to the following will automatically pass to, and vest in, and belong to Landlord, without further action on the part of either party: (i) the Property including, without limitation, the land, the Improvements , and any alterations thereto; (ii) all unaccrued rents, income, receipts, revenues, issues, and profits issuing from the Property or any part thereof; and (iii) all insurance policies and all proceeds thereof. Although not required to effectuate the automatic termination of Tenant’s interest in the Property, Tenant agrees that upon Landlord’s termination of this Lease, Tenant will execute appropriate documents , including a quitclaim deed, and perform any act reasonably necessary, to evidence the termination of its interest in the Property.

Section 2403 Damages
Subject to the limited recourse provisions of Section 2406, if either party defaults with regard to any of the provisions of this Lease, subject to the notice and cure provisions of Section 2302, the defaulting party will be liable to the non- defaulting party for damages caused by such default, and the non-defaulting party may, after such notice and opportunity to cure (but not before) commence an action for damages against the defaulting party with respect to such default. 138 of 422
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Section 2404 Specific Performance
If either party defaults with regard to any of the provisions of this Lease, subject to the notice and cure provisions of Section 2302, the non-defaulting party, at its option, may, after such notice and opportunity to cure (but not before) commence an action for specific performance of the terms of this Lease pertaining to such default.

Section 2405 Cumulative Remedies
Landlord will have the right to pursue , in addition to the remedies expressly enumerated herein, any remedy now or hereafter available under state or federal laws, including a proceeding to compel specific performance by Tenant. No remedy or election by either party hereunder will be deemed exclusive, but will, wherever possible, be cumulative with all other remedies available at law or in equity.

Section 2406 Limited Recourse
Each obligation of Tenant under this Lease is a nonrecourse obligation of Tenant and its partners. Neither Tenant nor any of its general or limited partners, nor any other party, will have any personal liability for payment of obligations to Landlord.

Notwithstanding the foregoing, Landlord may recover directly from Tenant or any other party:
(a) damages, costs and expenses incurred by Landlord as a result of fraud or a criminal act or acts of Tenant or any partner, shareholder, officer, director or employee of Tenant, or of any member or general or limited partner of Tenant, or of any member or general or limited partner of such member or general or limited partner;
(b) damages, costs and expenses incurred by Landlord as a result of any misappropriation of funds provided for the construction of the Improvements, rents and revenues from the operation of the Improvements or proceeds of insurance policies or condemnation proceeds;
(c) all amounts owing by Tenant pursuant to the indemnification regarding Hazardous Substances given in this Lease, and
(d) all court costs and attorneys’ fees reasonably incurred in enforcing or collecting upon any of the foregoing exceptions (provided that Landlord will pay Tenant’s reasonable court costs and attorneys’ fees if Tenant is the prevailing party in any such e nforcement or collection action).

ARTICLE XXV INTEREST ON PAST DUE OBLIGATIONS
Except as expressly provided herein, amounts due to either party, not paid when due, after the expiration of the permitted period to cure hereunder , will bear interest at the maximum rate then allowable by law, from the due date. Payment of such interest will not excuse or cure a default under this Lease.
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ARTICLE XXVI NOTICES
All notices, demands, and requests for approval to be given under this Lease will be given in writing , and will be deemed served when delivered personally , or will be deemed served seventy-two (72) hours after the deposit thereof in the United States mail, postage prepaid, registered mail, addressed as hereinafter provided.

To Landlord: HOUSING AUTHORITY OF

THE CITY OF GLENDALE
141 N. Glendale Avenue, Room 202,
Glendale, California 91206
Attention: Executive Director
Facsimile: 818-548-3724

With a copy to: KANE, BALLMER & BERKMAN
515 S. Figueroa St., Suite 780
Los Angeles, California 90071-3301
Attention: Susan Apy

To Tenant: 900 E BROADWAY, L.P.
c/o Meta Housing Corporation
1150 W. Olympic Blvd., Suite 620
Los Angeles, California 90064
Attention: President

With a copy to Investor Limited Partner:

Bank of America, N.A.

MA1-225-02-02
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Facsimile: 617-346-2257

And:

Banc of America CDC Special Holding Company, Inc.

MA1-225-02-02
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Facsimile: 617-346-2257
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And:

Buchalter, a Professional Corporation
1000 Wilshire Boulevard, Suite 1500
Los Angeles, CA 90017
Attn: Michael A. Williamson, Esq.

Facsimile: (213) 630-5799
Matter No: B0965-0629

With a copy to Construction Lender:

US Bank National Association
633 West 5
th Street, 24th Floor
Los Angeles, CA 90071
Attn: Global Corporate Trust Services

And

Bank of America, N.A.

Mailcode: CA4-704-06-06
2000 Clayton Road, 6
th Floor
Concord, CA 94520
Attention: Loan Administration Manager

And:

Buchalter, a Professional Corporation
1000 Wilshire Boulevard, Suite 1500
Los Angeles, CA 90017
Attn: Michael A. Williamson, Esq.

Facsimile: (213) 630-5799
Matter No: B0965-0630

With a copy to
Permanent Lender:

Citibank, N.A.
388 Greenwich Street, 8
th Floor
New York, New York 10013
Attention: General Counsel’s Office
Deal ID # 60001238
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ARTICLE XXVII ESTOPPEL CERTIFICATE
Each party to this Lease will, at any time, and upon not less than ten (10) days prior written notice from the other party, execute, acknowledge and deliver to the requesting party a statement in writing: (1) certifying that this Lease is unmodified and in full force and effect (or, if modified, stating the nature of such modification , and certifying that this Lease, as so modified, is in full force and effect); and (2) acknowledging that there are not, to such party’s knowledge, any uncured defaults hereunder, or specifying such defaults, if any, as are claimed. Any such statement may be conclusively relied upon by a prospective purchaser or encumbrancer of the Property.

ARTICLE XXVIII SURRENDER
Section 2801 Surrender
Tenant will, on the last day of the Lease Term or upon any earlier termination of this Lease, peaceably and quietly surrender and yield immediate possession of the entire Property, including the Improvements thereon, to Landlord. Tenant will not remove from the Property any appurtenant fixtures attached or used in connection with the operation of the Improvements and necessary for the proper operation thereof. All such fixtures and all operating manuals neces sary for the operation of the Improvements will be surrendered and delivered to Landlord upon expiration or termination of this Lease.

Section 2802 Title to Improvements
The parties agree that upon expiration of the Lease Term, or upon an earlier termination of this Lease, title to and ownership of all Improvements will automatically vest in Landlord without the execution of any further instrument and without any payment by Landlord therefor. Tenant will, at Landlord’s request and without payment therefor, promptly ex ecute, acknowledge and deliver to Landlord a quitclaim deed in recordable form conveying and transferring to Landlord all right, title and interest of Tenant in and to the leasehold interest and the Improvements.

Section 2803 Removal of Personal Property
On the last day of the Lease Term or upon an earlier termination of this Lease, Tenant will remove all of its personal property not required to be surrendered. Personal property not removed by Tenant upon the last day of the Lease Term or upon an earlier termination of this Lease will be deemed abandoned, and may be appropriated, sold, destroyed, or otherwise disposed of by Landlord following ten (10) days prior written notice to Tenant. Tenant will pay to Landlord all reasonable costs and expenses incurred in receiving, storing or disposing of same and for restoring any damage to the Property caused by such personal property or the removal thereof from the Property.

Section 2804 Holdover
If Tenant fails to surrender possession of the Property, or any part thereof, at the expiration of the Lease Term or upon an earlier termination of this Lease, the continuance in possession of Tenant will constitute a “holding over” by Tenant on a month-to-month basis for which Tenant is 142 of 422
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and will be liable to pay rent at fair market value (taking into consideration the Affordability Restrictions, if any remain in place on the Property) as such rent is determined by Landlord in its sole and absolute discretion. A holding over by Tenant after the expiration or earlier termination of this Lease will not constitute a renewal or extension of the Lease Term.

ARTICLE XXIX NO CONFLICT OF INTEREST, WARRANTY
Section 2901 No Conflict of Interest
Each party to this Lease covenants that neither they, nor any of their agents or employees who presently exercise any function or responsibility in connection with this Lease , have or will have, or will acquire, any financial interest which constitutes a conflict of interest under applicable City, state or federal laws, ordinances, rules, and regulations, including the Political Reform Act of 1974 (Government Code Sections 81000 et seq.), as it may be amended from time to time. No member, officer, or employee of either party or the governing body of the loca lity in which the Project is situated, nor any member of the governing body of the locality in which Tenant was activated, and no other public official of such locality or localities who exercises any functions or responsibilities with respect to the Project, during his or her tenure or for two (2) years thereafter, will have any interest, direct or indirect, in this Lease or the proceeds thereof.

Section 2902 Warranty Against Speculation
Tenant hereby represents and warrants that this Lease, the development and construction of the Improvements, and its other undertakings pursuant hereto, are, and will be used for , the purpose of providing affordable housing for low and moderate income households , and not for speculation in land holding. Tenant further recognizes:
(a) The importance of the development of the Project to the general welfare of the community; and
(b) The substantial financing and other public aids that have been made available by law and by Landlord for the purpose of making such development possible; and (c) The fact that a change in ownership or control of Tenant or of a part thereof, or any other act or transaction involving or resulting in a change in ownership, or with respect to the identity of the parties in control of Tenant or the degrees thereof, is for practical purposes a transfer or disposition of the Property and Improvements, except as to Permitted Transfers; and (d) The Property is not to be acquired or used for speculation, but only for development and operation by Tenant in accordance with the terms of the AHA and this Lease.

The qualifications and identity of Tenant, and its principals, are of particular concern to the community and Landlord. Tenant further recognizes that it is because of such qualifications and identity that Landlord is entering into this Lease with Tenant. 143 of 422
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ARTICLE XXX ADDITIONAL PROVISIONS
Section 3001 Time is of the Essence
Except as otherwise specifically provided in this Lease, time is of the essence in connection with each and every provision contained herein.

Section 3002 Waiver
No waiver by either party of any provision hereof will be deemed to be a waiver of any other provision hereof, or of any subsequent breach of the same or any other provision. No party’s consent to, or approval of, any act will be deemed to render unnecessary the obtaining of such party’s consent to or approval of any subsequent act. The acceptance of any payment hereunder will not be a waiver of any preceding breach of any provision hereof, other than the failure to make such payment itself, regardless of such party’s knowledge of the preceding breach at the time of acceptance of such payment.

Section 3003 Costs of Litigation
If legal action is necessary to enforce a provision hereof, or for damages by re ason of an alleged breach of a provision of this Lease, the prevailing party will be entitled to receive from the losing party all costs and expenses , and such amount as the court may adjudge to be reasonable attorneys’ fees for the costs incurred by the prevailing party in such action or proceeding.

Section 3004 Institution of Legal Actions
Subject to the notice and cure provisions of Section 2302 and the limited recourse provisions of Section 2406, in addition to any other rights or remedies (and except as otherwise provided in this Lease), either party may institute legal action to cure, correct or remedy a default, to recover damages for a default, or to obtain any other remedy consistent with the purpose of this Lease. Such legal actions must be instituted in the Superior Court of the County of Los Angeles, State of California, in any other appropriate court of that county, or in the United States District Court for the Central District of California.

Section 3005 Applicable Law
The inte rnal laws of the State of California will govern the interpretation and enforcement of this Lease, without reference to the principles governing conflicts of law.

Section 3006 Acceptance of Service of Process
(a) If a legal action is commenced by Tenant against Landlord, service of process on Landlord will be made by personal service upon Landlord’s Executive Director or in such other manner as may be provided by law.
(b) If a legal action is commenced by Landlord against Tenant, service of process on Tenant will be made by personal service upon Tenant (or upon an officer of Tenant) and will be valid whether made within or without the State of California, or in such manner as may be provided by law.
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Section 3007 Relationship of Parties
Nothing contained in this Lease will be deemed or construed to create the relationship of principal and agent, or of partnership, or of joint venture, or of any association between Landlord and Tenant, other than that of landlord and tenant.

Section 3008 Captions for Convenience
The captions herein are for convenience and reference only and are not a part of this Lease, and do not in any way limit, define, or amplify the terms and provisions hereof.

Section 3009 Entire Agreement
This Lease represents the full and complete understanding of every kind or nature whatsoever between the parties hereto , in connection with the lease of the Property , and all preliminary negotiations and agreements of whatsoever kind or nature are merged herein. No verbal agreement or implied covenant will be held to vary the provisions hereof.

Section 3010 Binding Effect
This Lease, and the terms, provisions, promises, covenants, and conditions hereof, will be binding upon and will inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors, and assigns.

Section 3011 Construction
The parties agree that each party and its counsel have reviewed this Lease, and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party will not apply in the interpretation of this Lease, or any amendments or exhibits hereto.

Section 3012 Tenant’s Payment of Property Taxes
To the extent required by California Health and Safety Code Section 33673, but subject to Tenant’s rights to claim exemptions under California Revenue and Taxation Code Section 214, Tenant will pay real property taxes upon the entire assessed value of the Property and not merely the assessed value of its leasehold interest in the Property.

Section 3013 Recording of this Ground Lease
A Memorandum of Lease, substantially in the form attached to the AHA as Attachment No. 8 will be recorded in the Official Records upon commencement of this Lease.

Section 3014 Severability
If any provision of this Lease is adjudged invalid or unenforceable by a court of competent jurisdiction, the remaining provisions of this Lease will not be affected thereby, and will be valid and enforceable to the fullest extent permitted by law. 145 of 422
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Section 3015 Counterparts
This Lease may be executed in several counterparts, each of which is an original, and all of which together constitute but one and the same document.

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Page S-1

IN WITNESS WHEREOF, the parties hereto have executed this Lease.

“LANDLORD”

THE HOUSING AUTHORITY OF THE

CITY OF GLENDALE

Dated:_________________, 2021 By:_____________________________ Roubik R. Golanian, P.E.

Interim Executive Director

APPROVED AS TO FORM AND LEGALITY:

MICHAEL J. GARCIA, CITY ATTORNEY
General Counsel to the Authority

By:______________________________
Michael J. Garcia

APPROVED AS TO FORM:

KANE, BALLMER & BERKMAN
Special Counsel to the Authority

By: ___________________________

[SIGNATURES CONTINUE ON NEXT PAGE]

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Page S-2

“TENANT”

900 E BROADWAY, L.P.,
a California limited partnership

by: 900 E Broadway, LLC,
a California limited liability company,
its Administrative General Partner

by: Meta Development, LLC,
a California limited liability company,
its Administrative General Partner

Dated: ______________, 2021 By:___________________________ Kasey Burke
Manager

by: WCH Affordable LXIII, LLC,
a California limited liability company,
its Managing General Partner

Dated: _____________, 2021 By:___________________________ Graham Espley-Jones
President

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Exhibit A – Legal Description

EXHIBIT A

LEGAL DESCRIPTION

THAT LAND SITUATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, CITY OF GLENDALE, DESCRIBED AS FOLLOWS:

LOTS 2, 4, 6, 8 AND 10 IN BLOCK 17 OF TO WN OF GLENDALE, IN T HE CITY OF

GLENDALE, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 14 PAGE 95, ET SEQ., AN D IN BOOK 52 PAGE 8 OF

MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE NORTH 20 FEET OF LOT 2 CONDEM NED BY THE CITY OF G LENDALE FOR STREET PURPOSES.

APN: 5674-010-900

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Exhibit B – Site Map

EXHIBIT B

SITE MAP
[Immedia
tely Follows This Page]
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Memorandum of Lease

RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

HOUSING AUTHOR
ITY OF

THE CITY OF GLENDALE
141 North Glendale Avenue, Suite 202
Glendale, California 91206
Attn: Director of Housing
and Community Development
SPACE ABOVE THIS LINE FOR RECORDER’S USE
APN: 5674-010-
900 OFFICIAL BUSINESS
Document entitled to free
recording per Government
Code Section 27383

MEMORANDUM

OF LEASE BETWEEN THE HOUSING AUTHORITY OF THE CITY OF
GLENDALE AND 900 E BROADWAY, L.P.
(900 EAST BROADWAY)
THIS M
EMORANDUM OF LEASE (“Memorandum”), dated as of ________________, 2021, is entered into by and between the Housing Authority of the City of Glendale, a public body, corporate and politic, (“Landlord”) and 900 E BROADWAY, L.P., a California limited partnership (“Tenant”).

RECITAL
S
A. Landlor
d and Tenant have entered into that certain Ground Lease dated as of ________________________, 2021 (“Lease”) pursuant to which Landlord leased to Tenant and Tenant leased from Landlord certain real property more particularly described in Exhibit “A” and incorporated herein by reference (“Property”).

B. Landlor
d and Tenant desire to execute this Memorandum to provide constructive notice of the Lease to third parties.

OPERATI

VE PROVISIONS

1. Lease Co
mmencement and Term. Landlord leases the Property to Tenant for a term commencing on the Commencement Date (___________, ______) and continuing thereafter until the seventy second (72nd) anniversary of the date of Conversion (as defined in the Lease), unless earlier terminated or extended pursuant to the option term as provided in the Lease.

2. Lease Ter
ms. The terms and provisions of the Lease are hereby incorporated into this Memorandum of Lease by this reference.

3. Leaseho
ld Deeds of Trust. Provisions for leasehold mortgages are contained in the Lease.

Attachment No. 8
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4. Assignment. Tenant’s rights under the Lease may not be assigned except in compliance with the terms of the Lease.

5. Successors and Assigns. This Memorandum of Lease and the Lease bind and inure to the benefit of, the parties and their respective, permitted heirs, successors in interest, and assigns, subject, however, to the terms of the Lease concerning assignment. The provisions of this Memorandum of Lease are solely for the purpose of providing notice of the Lease and, in the event of any conflict between the provisions of this Memorandum of Lease and the provisions of the Lease, the provisions of the Lease will prevail.

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IN WITNESS WHEREOF, the parties have executed this Memorandum of Lease as of the date first set forth above.

LANDLORD

THE HOUSING AUTHORITY OF THE

CITY OF GLENDALE

Dated: _____________, 2021 By:_____________________________ Roubik R. Golanian, P.E.

Executive Director

APPROVED AS TO FORM AND LEGALITY:

MICHAEL J. GARCIA, CITY ATTORNEY
General Counsel to the Authority

By:______________________________
Michael J. Garcia

APPROVED AS TO FORM:

KANE, BALLMER & BERKMAN
Special Counsel to the Authority

By: ___________________________

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Page S-2
TENANT

900 E BROADWAY, L.P.,
a California limited partnership

by: 900 E Broadway, LLC,
a California limited liability company,
its Administrative General Partner

by: Meta Development, LLC,
a California limited liability company,
its Administrative General Partner

Dated: ______________, 2021 By:___________________________ Kasey Burke
Manager

by: WCH Affordable LXIII, LLC,
a California limited liability company,
its Managing General Partner

Dated: _____________, 2021 By:___________________________ Graham Espley-Jones
President

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Exhibit A – Legal Description

EXHIBIT A

LEGAL DESCRIPTION

A leasehold interest created by that certain Ground Lease between the Housing Authority of the City of Glendale and 900 E BROADWAY, L.P., a California limited partnership, dated as of _______________, 2021 in the real property described as follows:

LOTS 2, 4, 6, 8 AND 10 IN BLOCK 17 OF TOWN OF GLENDALE, IN THE CITY OF

GLENDALE, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 14 PAGE 95, ET SEQ., AND IN BOOK 52 PAGE 8 OF

MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE NORTH 20 FEET OF LOT 2 CONDEMNED BY THE CITY OF GLENDALE FOR STREET PURPOSES.

APN: 5674-010-900

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Notice of Affordability Restrictions

RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

HOUSING AUTHOR

ITY OF THE

CITY OF GLENDALE
141 North Glendale Avenue, Suite 202
Glendale, California 91206
Attn: Director of Housing
and Community Development
SPACE ABOVE THIS LINE FOR RECORDER’S USE
APN: 5674-010-
900 OFFICIAL BUSINESS
Document entitled to free
recording per Government
Code Section 27383
Notice of Affordability Restrictions on Transfer of Property

NOTICE IS HER
EBY GIVEN that pursuant to Health & Safety Code Section 33334.3(f), the Housing Authority of the City of Glendale is recording this Notice of Affordability Restrictions on Transfer of Property (hereinafter the “Notice”) with regard to the property located at 900 East Broadway, Glendale, California and more particularly described in Exhibit “A” attached hereto (the “Property”).

The Pr
operty is subject to the Agreement Containing Covenants (the “Covenants”) recorded concurrently herewith, which rest ricts the use of the Property as follows:
(1) Four (4)
units will be rented exclusively to Extremely Low
Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50053, consisting of the following: (a) three (3) studio units; and (b) one (1) one-bedroom unit. (2) Nine (9) un
its wi ll be rented exclusively to Very Low
Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50053, consisting of the following:
(a) six (6) studio units; and (b) three (3) one-bedroom units.

Attachment No. 9
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(3) Thirteen (13) units will be rented exclusively to Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50053, consisting of the following: (a) nine (9) studio units; and (b) four (4) one-bedroom units.

(4)
Thirty-one ( 31) units will be rented exclusively to
households meeting the sixty percent (60%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) twenty-two (22) studio units; and (b) nine (9) one-bedroom units.

(5) Sixty-nine (69) units will be rented exclusively to households meeting the seventy percent (70%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) forty -seven (47) studio units; and (b) twenty-two (22) one-bedroom units.

The maximum incomes of eligible tenants under (1), (2), and (3) above will be determined on the basis of the income limits for Extremely Low Income, Very Low Income , and Low Income households in the Los Angeles-Long Beach SMSA, published approximately annually by the California Department of Housing and Community Development (“HCD”). If HCD discontinues publishing such income limits, the term “Extremely Low Income” shall mean a household income that does not exceed 30% of the area median income, adjusted for family size , the term “Very Low Income” shall mean a household income that does not exceed 50% of the area median income, adjusted for family size , and the term “Low Income” shall mean a household income that does not exceed 80% of the area median income, adjusted for family size.

Rents charged to a tenant may not exceed rents that are afforda ble to Extremely Low Income Households, V ery Low Income Households, and Low Income Households and 60% and 70% AMI Households, as applicable. The maximum rents, including a reasonable utility allowance for utilities and services (excluding telephone) to be paid by Extremely Low Income, Very Low Income , and Low Income
Households under (1), (2), and (3) above will be the lower of the
maximum rent applicable to Low Income Housing Tax Credits 157 of 422
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pursuant to the Tax Reform Act of 1986, as amended, and governed by Section 42 of Internal Revenue Code requirements for so long as such requirements are applicable or the maximum rent for the applicable income level as set forth below:

(i) In the case of an Extremely Low Income Household, the maximum rent shall be a rent that does not exceed 30 percent (30%) of thirty (30%) percent of the area median income adjusted for household size appropriate to the unit, as determined by the California Department of Housing and Community Development.

(ii) In the case of any Very Low Income Household, the
maximum rent shall be a rent that does not exceed 30 percent (30%) of fifty (50%) percent of the area median income adjusted for household size appropriate to the unit, as determined by the California Department of Housing and Community Development.

(ii) In the case of any Low Income Household, the maximum rent shall be a rent that does not exceed 30 percent (30%) of sixty (60%) percent of the area median income adjusted for household size appropriate to the unit, as determined by the California Department of Housing and Community Development.

The affordability restrictions imposed on the Property by the Covenants are scheduled to expire on the date that is fifty-five (5 5) years after the date of Conversion (i.e., around ____________, 20______).

This Notice is recorded for the purpose of providing notice only and it in no way modifies the provisions of the Covenants.

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Notice of Affordability Restrictions

THE HOUSING AUTHORITY OF THE

CITY OF GLENDALE

Dated:_________________, 2021 By:_____________________________ Roubik R. Golanian, P.E.

Interim Executive Director

APPROVED AS TO FORM AND LEGALITY:

MICHAEL J. GARCIA, CITY ATTORNEY
General Counsel to the Authority

By:______________________________
Michael J. Garcia

APPROVED AS TO FORM:

KANE, BALLMER & BERKMAN
Special Counsel to the Authority

By: ___________________________

[SIGNATURES CONTINUE ON NEXT PAGE]

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Consent to Recordation

CONSENT TO RECORDATION
The undersigned, owner of the leasehold interest in real property legally described in Exhibit “A” hereto, hereby consents to the recordation of the foregoing Notice of Affordability Restrictions on Transfer of Property against said real property.

900 E BROADWAY, L.P.,
a California limited partnership

By: 900 E Broadway LLC,
a California limited liability company,
its administrative general partner

By: New Meta Housing, LLC,
A California limited liability company,
its manager

By: _________________________
Kasey Burke, Manager

By: WCH Affordable LXIII,
a California limited liability company,
its managing general partner

By: Western Community Housing, Inc.,
a California corporation,
its manager

By: ____________________________
Graham Espley -Jones, President

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Exhibit A – Legal Description

Exhibit “A”

LEGAL DESCRIPTION

A LEASEHOLD INTEREST CREATED BY THAT CERTAIN GROUND LEASE BETWEEN THE HOUSING AUTHORITY OF THE CITY OF GLENDALE AND 900 E BROADWAY, L.P.

DATED AS OF _______________, 2021 IN THE REAL PROPERT Y DESCRIBED AS FOLLOWS:

LOTS 2, 4, 6, 8 AND 10 IN BLOCK 17 OF TOWN OF GLENDALE, IN THE CITY OF

GLENDALE, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 14 PAGE 95, ET SEQ., AND IN BOOK 52 PAGE 8 OF

MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE NORTH 20 FEET OF LOT 2 CONDEMNED BY THE CITY OF GLENDALE FOR STREET PURPOSES.

APN: 5674-010-900

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RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

HOUSING AUTHOR
ITY OF

THE CITY OF GLENDALE
141 North Glendale Avenue, Suite 202
Glendale, California 91206
Attn: Director of Housing
and Community Development
SPACE ABOVE THIS LINE FOR RECORDER’S USE
APN: 5674-010-
900 OFFICIAL BUSINESS
Document entitled to free
recording per Government
Code Section 27383

AGREEME

NT CONTAINING COVENANTS
(Including Rental Restrictions)
(900 East Broadway)
THIS AGREEMENT CONTAINING COVENANTS (“Agreement”) is entered into as of ______________________, 2021 by and between the HOUSING AUTHORITY OF THE CITY OF GLENDALE, a public body, corporate and politic (“Authority”) and 900 E BROADWAY, L.P., a California limited partnership (“Owner”).

WHEREAS, Owner is the owner of a leasehold interest in that certain real property (“Property”) located in the City of Glendale and more particularly described in Exhibit “A” which is attached hereto and incorporated herein by this reference; and WHEREAS, for the purpose of providing housing that will be affordable to Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households, Owner and the Authority have entered into an Affordable Housing Agreement, dated as of _______________________, 2021, as amended from time to time (“Affordable Housing Agreement”), which is incorporated herein by this reference (any capitalized term that is not otherwise defined in this Agreement has the meaning ascribed to such term in the Affordable Housing Agreement); and WHEREAS, pursuant to the Affordable Housing Agreement , the Authority is providing financial assistance to Owner to assist in the acquisition and development of the Property, using LMIHAF and Measure S Funds; and
WHEREAS, the Owner has obtained an allocation of Low Income Housing Tax Credits pursuant to the Tax Reform Act of 1986, as amended, and governed by Section 42 of Internal Revenue Code (“Tax Credits”); and
Attachment No. 10
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WHEREAS, the use of the Tax Credits to finance the development of the Property imposes income and affordability requirements such that four (4) of the units will be restricted at 20 % tax credit limits, nine (9) of t he units will be restricted at 30% tax credit limits, thirteen (13) of t he units will be restricted at 40% tax credit limits, thirty-one (31) of the units will be restricted at 60% tax credit limits, and sixty-nine (69) of the units will be restricted at 70% tax credit limits; provided however, that nothing herein will be deemed to authorize charging rents in excess of the Affordable Rent for the specified units set forth in Section 3.a below; and WHEREAS, the use of Multifamily Housing Revenue Bonds to finance the development of the Property imposes income and affordability limits set forth in the Regulatory Agreement and Declaration of Restrictive Covenants recorded against the Property concurrently with this Agreement; provided however, that nothing herein will be deemed to authorize charging rents in excess of the Affordable Rent for the specified units set forth in Section 3.a below; and WHEREAS, the Affordable Housing Agreement contains certain provisions relating to the use of the Property and imposes additional income and affordability requirements.

NOW, THEREFORE, AUTHORITY AND DEVELOPER COVENANT AND AGREE AS FOLLOWS:

1. Construction Covenant.

Owner hereby covenants and agrees on behalf of itself and its successors and assigns in the Property or any portion thereof or any improvements thereon or any interest therein that Owner and such successors and assigns will develop and construct on the Property a residential apartment Project, which will contain one hundred twenty-seven (127) residential units (87 studios, 39 one- bedrooms and 1 two-bedroom) and associated amenities, in accordance with the Affordable Housing Agreement (including but not limited to the Scope of Development), the Ground Lease, this Agreement, and plans approved by the City of Glendale.

2. Maximum Incomes.
a. Owner covenants and agrees for itself and its successors, its assigns and every successor in interest to the Property or any part thereof, that Owner and its successors and assignees will use the Property exclusively to provide affordable housing for Extremely Low, Very Low, and Low Income Senior Citizen Households, subject to all of the terms and conditions of this Agreement, except for one two -bedroom unit designated as the management unit for the on- site manager. The remaining 126 units will be allocated as follows:
i. Four (4) units will be rented exclusively to Extremely Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50053, consisting of the following: (a) three (3) studio units and (b) one (1) one-bedroom unit.
ii. Nine (9) units will be rented exclusively to Very Low Income Senior Citizen H ouseholds at an Affordable Rent as provided in California Health and Safety Code 163 of 422
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Section 50053, consisting of the following: (a) six (6) studio units; and (b) three (3) one-bedroom units.
iii. Thirteen (13) units will be rented exclusively to Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50053, consisting of the following: (a) nine (9) studio units; and (b) four (4) one-bedroom units.
iv. Thirty-one (31) units will be rented exclusively to households meeting the sixty percent (60%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) twenty -two (22) studio units; and (b) nine (9) one-bedroom units.
v. Sixty-nine (69) units will be rented exclusively to households meeting the seventy percent (7 0%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) forty - seven (47) studio units; and (b) twenty-two (22) one-bedroom units. b. The maximum incomes of eligible tenants for the units described in paragraphs 2.a.i, 2.a.ii, and 2.a.iii above will be determined on the basis of the income limits for Extremely Low Income, Very Low Income, and Low Income households respectively in the Los Angeles-Long Beach SMSA, published approximately annually by the California Department of Housing and Community Development (“HCD”). If HCD discontinues publishing such income limits, the term “Extremely Low Income” will mean a household income that does not exceed 30% of the area median income, adjusted for family size, the term “Very Low Income ” will mean a household income that does not exceed 50% of the area median in come, adjusted for family size, and the term “Low Income” will mean a household income that does not exceed 80% of the area median income, adjusted for family size. For the term of the Tax Credits, in no case will household income exceed applicable Tax Credit income limits.
c. Owner will obtain and maintain on file an income computation and certification form from such prospective tenant dated immediately prior to the date of initial occupancy. Owner will verify that the income information provided by an appl icant is accurate by following all applicable Authority policies and procedures and by taking one or more of the following steps as a part of the verification process: (i) obtain two (2) pay stubs from the most recent pay periods; (ii) obtain a written ve rification of income and employment from applicant’s current employer; (iii) obtain an income verification form from the Social Security Administration and/or California Department of Social Services if the applicant receives assistance from either agency; (iv) if an applicant is unemployed or did not file a tax return for the previous calendar year, obtain other verification of such applicant’s income as is reasonably satisfactory; or (v) obtain such other information as may be reasonably required. Each tenant lease will contain a provision to the effect that Owner has relied on the income certification and supporting information supplied by the tenant in determining qualification for occupancy of a Unit, and that any material misstatement in such certification (whether or not intentional) will be cause for immediate termination of such lease.
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d. Owner will update income records annually and provide copies of updated tenant eligibility records and monthly rental records to the Authority for review. Upon revie w of such records, the Authority may at its option perform an independent audit of the tenant eligibility records in order to verify compliance with the income and affordability requirements set forth herein. Costs for such an audit performed by the Authority will be deemed an Operating Expense, deductible from the Project’s Revenue (as such terms are defined in the LMIHAF Note and the Measure S Note). Owner will retain the records described in this Section for a period of not less than five (5) years after the date each record was created.

3. Maximum Rents.
a. Rents charged to a tenant will not exceed rents that are affordable to Extremely Low Income, Very Low Income, and Low Income Households , as applicable, (as “Affordable Rent ” is defined below). The maximum rents, including a reasonable utility allowance for utilities and services (excluding telephone) to be paid by Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households will be the lower of the maximum rent permitted to be charged pursuant to the Extended Use Agreement recorded against the Property in connection with the Tax Credit requirements for so long as suc h requirements are applicable and the maximum rent for the applicable income level as set forth below:
i. In the case of an Extremely Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of thirty percent (30%) of the area median income adjusted for household size appropriate to the unit, as determined by HCD. ii. In the case of a Very Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of fifty percent (50%) of the area median income adjusted for household size appropriate to the unit, as determined by HCD. iii. In the case of a Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of sixty percent (60%) of the area median income adjusted for household size appropriate to the unit, as determined by HCD. iv. In the case of a Senior Citizen Household occupying a unit described in Paragraphs 2.a.iv or 2.a.v above, the maximum rent will be the maximum allowable rent under the Extended Use Agreement recorded against the Property in connection with the Tax Credits. v. For the purpose of determining Affordable Rent under Paragraphs

3.a.i, 3.a.ii, and 3.a.iii above, household size appropriate to the unit will mean two persons in the case of a 1-bedroom unit.
b. This affordability requirement will continue in effect for the Term of this Agreement.
c. Failure to comply with the affordability requirements of this Agreement following notice from the Authority and an opportunity to cure such failure is an event of default under the terms of the LMIHAF Loan and the Measure S Loan. Pursuant to the LMIHAF Note 165 of 422
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and the Measure S Note, subject to the right to cure, the LMIHAF Loan and the Measure S Loan will be due and payable immediately if the housing does not meet the affordability requirements of this Agreement.
d. Upon request, the Authority Execut ive Director will notify Owner of the maximum rents that may be charged under Paragraphs 3.a.i, 3.a.ii, and 3.a.iii above (not to exceed “Affordable Rent”) and the maximum income of persons who are eligible to occupy the Property, based on the then -current area median income. In no event will rents exceed the maximum rent permitted by the tax credit regulations or (with regard to the allocation of units set forth in Section

2.a hereof) the rules applicable to the use of LMIHAF and Measure S Fund moneys, whichever is the lowest.
e. Owner, its successors and assigns will not charge rents in excess of the amounts determined as set forth in Section 3. In the event that either Owner or the Authority determines that Owner has charged a tenant rent in excess of the amount set forth herein, Owner will immediately reimburse the tenant the amount of overpayment, with interest, from the date of rental payment, at the highest non-usurious rate of interest permitted by law, within ten (10) days of such determination. Owner may revise rents not more than once annually.

4. Project Monitoring Fee.

Annually, on or before the first day of each fiscal year, Owner will pay to the Authority a Project monitoring fee in an amount equal to $150 per Unit per year, which fee shall accrue interest if not paid when and as due under this Agreement, from the date the fee is due until paid in full, at the highest non-usurious rate of interest then permitted by law . Notwithstanding any other provision of this Agreement, this provision shall be subject to a fifteen (15) day notice and cure period.

5. Tenant Selection.

Owner will adopt, based upon a draft prepared by the Authority, written tenant selection policies and criteria, for approval by the Authority, that meet the following requirements:
a. Are consistent with the purpose of providing housing for Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households. b. Are reasonably related to program eligibility and the applicants’ ability to perform the obligations of the lease.
c. Give reasonable consideration to the housing needs of persons that would have a preference under 42 CFR §906.211 (Federal selection preferences for admission to Public Housing);
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d. Provide for:
i. The selection of otherwi se eligible tenants from a written waiting list in the chronological order of their application, insofar as is practicable, taking into account applicants’ need for accessible features;
ii. The prompt written notification to any rejected applicant of the grounds for any rejection;
e. Tenant selection will be administered in accordance with the tenant selection plan approved by the Authority.
f. Carry out the Affirmative Marketing procedures of the City of Glendale, to provide information and otherwise attract eligible persons from all racial, ethnic and gender groups in the housing market area. Owner and Authority will cooperate to effectuate this provision during the Owner’s initial lease-up of the Property and as vacancies occur.

6. Nondiscrimination Based on Source of Income.

Owner, its successors and assigns, will not refuse to accept for occupancy an otherwise eligible household that is a holder of a certificate or voucher under 24 CFR part 982- Section 8 Tenant - Based Assistance: Unified Rule for Tenant -Based Assi stance under the Section 8 Rental Certificate Program and the Section 8 Rental Voucher Program or to the holder of a comparable document evidencing participation in a HOME tenant-based rental assistance program because of the status of the prospective tena nt as a holder of such certificate of family participation, rental voucher, or comparable HOME tenant-based assistance document.

7. Increases in Tenant Incomes.

This Section will govern in the event of increases in tenant incomes : (a) A tenant who initially qualified as an Extremely Low Income Household, but who, due to an increase in income, no longer qualifies as an Extremely Low Income Household but does qualify as a Very Low Income Household, will pay as rent an amount that is Affordable Rent to a Very Low Income Household, as defined in Section 2 above; (b) a tenant who initially qualified as a Very Low Income Household, but who, due to an increase in income, no longer qualifies as a Very Low Income Household but does qualify as a Low Income Household, will pay as rent an amount that is Affordable Rent to a Low Income Household, as defined in Section 2 above; and (c) a tenant who initially qualified as a Very Low Income or a Low Income Household, but who, due to an increase in income, no longer qualifies as either a Very Low Income or a Low Income Household, will pay as rent the lesser of the amount payable by the tenant under tax credit regulations, State or local law or 30 percent of the household’s adjusted income.

8. Tenant Protections.

Each tenant lease must provide for housing for not less than one year, unless by mutual agreement between the tenant and the Owner. The lease may not contain any of the following provisions (in 167 of 422
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which references to “owner” will mean the Owner, its successors or assigns):
a. Agreement by the tenant to be sued, to admit guilt, or to a judgment in favor of the owner in a lawsuit brought in connection with the lease; b. Agreement by the tenant that the owner may take, hold, or sell personal property of household members without notice to the tenant and a court decision on the rights of the parties. This prohibition, however, does not apply to an agreement by the tenant concerning disposition of personal property remaining in the housing unit after the tenant has moved out of the unit. The owner may dispose of this personal property in accordance with state law; c. Agreement by the tenant not to hold the owner or the owner’s agents legally responsible for any action or failure to act, whether intentional or negligent; d. Agreement of the tenant that the owner may institute a lawsuit without notice to the tenant;
e. Agreement by the tenant that the owner may evict the tenant or household members without instituting a civil court proceeding in which the tenant has the opportunity to present a defense, or before a court decision on the rights of the parties; f. Agreement by the tenant to waive the right to a trial by jury; g. Agreement by the tenant to waive the tenant’s right to appeal, or to otherwise challenge in court, a court decision in connection with the tenant housing agreement; and
h. Agreement by the tenant to pay attorney’s fees or other legal costs even if the tenant wins in a court proceeding by the owner against the tenant. The tenant, however, may be obligated to pay costs if the tenant loses.

9. Termination of Lease.

Owner, its successors or assigns, may not terminate a lease or refuse to renew the lease of a tenant, except for: serious or repeated violation of the terms and conditions of the lease; violation of applicable federal, state, or local law; or other good cause. Any termination or refusal to renew must be provided by Owner ’s service upon the tenant of a written notice specifying the grounds for the action in the time and manner proscribed by law.

10. Maintenance Obligations.

Owner will maintain the improvements on the Property in compliance with all applicable housing quality standards and local code requirements, and will keep the Property free from any unreasonable accumulation of debris or waste materials. Maintenance will be performed in a manner that will preserve the Project’s LEED Platinum standards. Prior to the recordation of this Agreement, Owner prepared and submitted to the Executive Director of the Authority for approval 168 of 422
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a program (the “ Maintenance Program ”) for t he maintenance of the Property and the Improvements. For the Term of this Agreement , Owner, and its successors and assigns, will maintain the Property and the Improvements in accordance with the approved Maintenance Program, as the same may be amended from time to time with the written approval of the Executive Director of the Authority. If Owner fails to maintain the Property and the Improvements in accordance with the approved Maintenance Program, the Authority will have the right, but not the obligation, to enter the Property and the Improvements, correct any violation, and hold Owner responsible for the cost thereof, and such cost, until paid, will constitute a lien on the Property.

11. Nondiscrimination.

Owner covenants and agrees for itself, its successors, its assigns and every successor in interest to the Property or any part thereof, there will be no discrimination against or segregation of any person, or group of persons, on account of race, color, national origin, religion or sex in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor will Owner itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Property. All deeds, leases or contracts will contain or be subject to substantially the following nondiscrimination or nonsegregation clauses:
a. In deeds: “The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the premises herein conveyed.

The foregoing covenants shall run with the land.”
b. In leases: “The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions:

That there shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person cl aiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or 169 of 422
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vendees in the premises herein leased.”
c. In contracts: There shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the land, nor shall the transferee itself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees of the land.”

12. Management Obligations.

Prior to the recordation of this Agreement, Owner prepared and submitted to the Authority Executive Director for approval a “ Management Plan ” pursuant to the Affordable Housing Agreement, describing Owner’s proposed plans for managing and operating the Property, a copy of which is on file at the offices of the Authority . For the Term of this Agreement , Owner will manage and operate the Property in accordance with the approved Management Plan, including such amendments as may be approved in writing from time to time by the Owner and the Authority Executive Director. Throughout the Term of this Agreement, the Project must include at least one on-site Property Manager.

13. Removal and Replacement of Property Manager.

Owner’s agreement with the Property Manager must provide that it is subject to termination by Owner without penalty, upon thirty (30) days prior written notice. Owner hereby covenants and agrees that, if the Authority determines in its reasonable judgment that the Project is not being operated and managed in accordance with the approved Management Plan, the Authority may deliver notice to the Owner of its determination that the Project’s management practices do not conform to the Management Plan (t he “Authority Notice ”), including a reasonably detailed explanation of such non- conformance. The Authority and Owner will meet and confer in good faith to identify actions to be taken by Owner to bring its management practices into conformance with the Management Plan, which could include replacing the Property Manager. Owner will have thirty (30) days after receipt of the Authority Notice (or such longer time as may be granted by the Authority) to either change its management practices to conform to the Ma nagement Plan or replace the Property Manager with a manager approved by the Authority and by all of Owner’s “Permitted Leasehold Mortgagees” as such term is defined in the Ground Lease . Owner must promptly notify the Authority upon learning that there is a change in the management or control of the Property Manager, and, if the change is unsatisfactory to the Authority, it may require Owner to replace the Property Manager in accordance with the terms of this paragraph. Notwithstanding the foregoing, if the Authority determines that the Property Manager has violated local, state, or federal campaign finance laws, it will have the right to require Owner to immediately remove and replace the Property Manager with a manager approved by the Authority. 170 of 422
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14. Financial Reports.

Owner will submit the following financial reports for the Project:
a. On or before the first day of each fiscal year, an estimated annual budget for management of the Property (the “Annual Project Budget”). The Annual Project Budget will include all necessary operating expenses, current maintenance charges, expenses of reasonable upkeep and repairs, taxes and special assessment levies, prorated amount required for insurance and all other expenses incident to the operation of the Project; and will show the expected revenues to pay such expenses, including annual debt service requirements and reserve fund deposits and balances. The Annual Project Budget, including any amendments proposed by the Owner, will be subject to the approval of the Authority Executive Director. b. Sixty (60) days following the last day of each quarter of the fiscal year, beginning on the date of first occupancy, a quarterly report for the management of the Property (the “Quarterly Report”) during such quarter. The Quarterly Report will include a profit and loss statement, budget to date figures, and occupancy report. The Executive Director in his sole discretion may waive the requirement of the Quarterly Report for one or more quarterly reporting periods. However, such waiver will not operate to waive any future right of the Authority to require a subsequent Quarterly Report. If at any time the Authority determines that the Property is not being managed or maintained in accordance with the approved Management Plan, Owner will change its management personnel or the practices complained of, upon receipt of written notice from the Authority.
c. Owner will pay to Authority a late fee in the amount of $1,500 for each Annual Project Budget and/or Quarterly Report which is not submitted to the Authority within the times and in the form and substance required by this Agreement, which late fee shall accrue interest if not paid when and as due under this Agreement, from the date the fee is due until paid in full, at the highest non- usurious rate of interest then permitted by law . Notwithstanding any other provision of this Agreement, this provision shall be subject to a fifteen (15) day notice and cure period.

15. Term of This Agreement.

The covenants established in this Agreem ent and any amendments hereto approved by the Authority and the Owner will, without regard to technical classification and designation, be binding for the benefit and in favor of the Authority, its successors and assigns, and the City of Glendale. The requirements of this Agreement will commence at its recordation and will remain in effect until the date that is fifty-five (55) years after Conversion (the “Term”). This Agreement will remain in effect throughout its full Term, notwithstanding the payment in full of the LMIHAF Loan and/or the Measure S Loan. This Agreement is secured by the Deed of Trust recorded concurrently herewith and Owner will not be entitled to a reconveyance of the Deed of Trust prior to the expiration of the full Term of this Agreement. This Agreement will unconditionally be and remain at all times prior and superior to the lien created by the Senior Deed of Trust and any other of the Senior Loan Documents and all of the terms and conditions contained in the Senior Loan Documents and to the lien of any new mortgage debt which is for the purpose of refinancing all or 171 of 422
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any part of the Senior Loan.

16. Enforcement of This Agreement.

The Authority and the City of Glendale are deemed beneficiaries of the terms and provisions of this Agreement and the covenants herein, both for and in their own right and for the purposes of protecting the interests of the community and other parties, public or private, for whose benefit this Agreement and the covenants running with the land have been provided. The Authority and the City will each have the right, if the covenants are breached, to exercise all rights and remedies and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and covenants are entitled. Owner hereby agrees that specific enforcement of its obligations contained herein is the only means by which the Authority may fully obtain the benefits of this Agreement, and Owner therefore agrees to the imposition of the remedy of specific performance against it in the case of uncured default by Owner hereunder.

17. Waiver.

A waiver by the Authority or the City of the performance of any covenant or condition herein will not invalidate this Agreement nor will it be considered a waiver of any other covenants or conditions, nor will the delay or forbearance by the Authority or the City in exercising any remedy or right be considered a waiver of, or an estoppel against, the later exercise of such remedy or right.

18. Covenants Run With the Land.

The covenants and agreements contained herein will run with the land and not be personal obligations of Owner. Upon the sale, conveyance or other transfer of the Property approved by the Authority or otherwise permitted under the Affordable Housing Agreement, the Authority Note and Deed of Trust (a “Transfer”) and the assumption of the obligations hereunder by a transferee, the Owner’s liability for performance will be terminated as to any obligation to be performed hereunder after the date of such Transfer.

19. Amendments.

This Agreement may be amended only by a written instrument executed by the parties hereto or their successors in title, and duly recorded in the Official Records of the County of Los Angeles, State of California; provided, however, the restrictions on the income and rent restrictions must be approved by all “Permitted Leasehold Mortgagees” as such term is defined in the Ground Lease.

20. Notice.

Any notice required to be given hereunder shall be given in the manner set forth in the Affordable Housing Agreement.
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21. Execution in Counterparts.

This Agreement may be executed by each party on a separate signature page, and when the executed signature pages are combined, will constitute one single instrument. [Remainder of Page Intentionally Left Blank]
[Signatures Appear on Next Pages]
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Page S-1
IN WITNESS WHEREOF, the Authority and Owner have executed this Agreement.

“AUTHORITY”

THE HOUSING AUTHORITY OF THE

CITY OF GLENDALE

By:____________________________
Roubik R. Golanian, P.E.

Executive Director

APPROVED AS TO FORM AND LEGALITY:

MICHAEL J. GARCIA, CITY ATTORNEY
General Counsel to the Authority

By:_____________________________
Michael J. Garcia

APPROVED AS TO FORM:

KANE, BALLMER & BERKMAN
Special Counsel to the Authority

By:______________________________

[Signatures Continue on Next Page]

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Page S-2
“OWNER”

900 E BROADWAY, L.P.,
a California limited partnership

by: 900 E Broadway, LLC,
a California limited liability company,
its Administrative General Partner

by: Meta Development, LLC,
a California limited liability company,
its Administrative General Partner

Dated: ______________, 2021 By:___________________________ Kasey Burke
Manager

by: WCH Affordable LXIII, LLC,
a California limited liability company,
its Managing General Partner

Dated: _____________, 2021 By:___________________________ Graham Espley-Jones
President

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Exhibit A – Legal Description
Exhibit “A”

LEGAL DESCRIPTION

A leasehold interest created by that certain Ground Lease between the Housing Authority of the City of Glendale and 900 E BROADWAY, L.P., a California limited partnership, dated as of _______________, 2021 in the real property described as follows:

LOTS 2 , 4, 6, 8 AND 10 IN BLOCK 17 OF TOWN OF GLENDALE, IN THE CIT Y OF

GLENDALE, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 14 PAGE 95, ET SEQ., AN D IN BOOK 52 PAGE 8 OF

MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE NORTH 20 FEET OF LOT 2 CONDEM NED BY THE CITY OF G LENDALE FOR STREET PURPOSES.

APN: 5674-010-900

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HOME Regulatory Agreement

Recording Requested by
and When Rec
orded Return to:

HOUSING AUTHORI
TY OF

THE CITY OF GLENDALE
141 North Glendale Avenue, Suite 202
Glendale, California 91206
Attention: Director of Housing
and Community Development
SPACE ABOVE THIS LINE FOR RECORDER’S USE
APN: 5674-010-900

OFFICIAL BUSINESS
Document entitled to free
(Govt. Code §27383)

AGREEMENT

CONTAINING HOME PROGRAM REQUIREMENTS
(24 CFR § 92.504)

THE HOUSING AU
THORITY OF THE CITY OF GLENDALE, a public body, corporate and politic (“Authority”), and 900 E BROADWAY, L.P ., a California limited partnership (“Developer”), in furtherance of the regulations issued by the United States Department of Housing and Urban Development set forth in 24 CFR Part 92 (the “HOME Regulations”), hereby agree as follows as of _______________________________, 2021.

WHEREAS,
the Authority is responsible for administering the use of certain funds made available to the City of Glendale by the United States Department of Housing and Urban Development (“ HUD”) under the HOME Investment Partnerships Program (the “ HOME Program”); and
WHEREA
S, Developer is the owner of a leasehold interest in that certain real property (the “Property”) located in the City of Glendale and more particularly described in Exhibit “A” which is attached hereto and incorporated herein by this reference, pursuant to that certain Ground Lease between the Authority and Developer dated as of __________________________, 2021 (the “Ground Lease”); and
WHEREAS, the Housing Authority and Developer have entered into a n Affordable Housing Agreement dated as of _____________, 2021, as amended from time to time (the “AHA”), providing, among other things, for the construction on the Property of a 127-unit multi- Attachment No. 11
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family housing project operated as affordable rental housing for Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households; and

WHEREAS, pursuant to the AHA, the Authority is providing a loan of HOME Funds to Developer (the “HOME Loan”), for payment of a portion of the development costs of the Project; and

WHEREAS, the parties mutually desire to comply with all applicable HOME Regulations.

NOW, THEREFORE, the Authority and Developer hereby agree as follows:

1. Term of this Agreement.

In accordance with the formula set forth in 24 CFR 92.252(e) and as required by 24 CFR 92.504 (c)(3)(ix), this Agreement will remain in effect for not less than twenty (20) years for newly constructed HOME units following the date the City of Glendale issues a certificate of occupancy for the Project (the “HOME Affordability Period”); and, following the expiration of the HOME Affordability Period will continue and remain in effect for the benefit of the Authority for an additional thirty-five (35) years, for a total term of fifty-five (55) years.

2. Affordable Housing Agreement.

The AHA, as it may be amended from time to time, including all the attachments appended thereto, is incorporated herein by this reference. Any capitalized term not otherwise defined herein will have the meaning ascribed to such term in the AHA.

3. Use of HOME Funds. 24 CFR 92.504(c)(3)(i).

The HOME Funds will be used exclusively for the payment of costs incurred in connection with the development of the Property and the construction thereon of the Project (sometimes referred to herein as the “Project Activities”) in accordance with the AHA.

a. Schedule
. Subject to Force Majeure Delays, t he development of the Property will be accomplished within the time provided in the Schedule of Performance, which is attached to the AHA as Attachment No. 5.
b. Tasks and Budget. The tasks to be performed with the use of the HOME Funds, and the Project Budget, which specifies the line items for which HOME Funds will be used, are set forth in the Project Budget attached to the AHA as Attachment No. 6. 178 of 422
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4. Affordability. 24 CFR 92.252; 92.504(c)(3)(ii).
a. The Project will be used exclusively as affordable rental housing as required by the various regulatory agreements relating to the Project. Eleven (11) units will be designated as floating HOME units (“HOME-assisted Units”) and restricted as follows: five (5) studio units and six (6) one-bedroom units for Very Low Income Senior Citizen Households (income not to exceed fifty (50%) of median family income as determined by the United States Department of Housing and Urban Development).
b. The maximum rent, including a reasonable utility allowance for utilities and services (excluding telephone), to be paid by Very Low Income Households must meet either i. or ii. of the following rent requirements:
i. The rent does not exceed the lesser of (a) 30 percent of the annual income of a family whose income equals 50 percent of the median income for the area, as determined by HUD, with adjustments for smaller and larger families, as provided by HUD; (b) the fair market rent for existing housing for comparable units in the area as established by HUD under 24 CFR 888.111; or
ii. The rent does not exceed 30 percent of the family’s adjusted income.

If the unit receives Federal or State project-based rental subsidy and the family pays as contribution toward rent not more than 30 percent of the family’s adjusted income, then the maximum rent (i.e., tenant contribution plus project -based rental subsidy) is the rent allowable under the Federal or State project-based rental subsidy program.
c. The HOME rent limits published by HUD will include average occupancy per unit and adjusted income assumptions.
d. The parties agree that if the Project were placed in service on the date of this Agreement, the maximum gross rents that would be paid by , and the HOME-assisted Units that would be occupied by, Very Low Income Households pursuant to Section 4 would be as set forth in the table of rents appended as Exhibit B. The HOME rents provided in Exhibit B will be adjusted to not exceed the maximum rent limits provided by HUD at the date of initial occupancy and will be adjusted periodically thereafter in accordance with 24 CFR part 92.252(f) and (g). e. Rents for the HOME -assisted Units will remain affordable to Very Low Income Households pursuant to this Agreement for the term set forth in Section 1 of this Agreement.
f. Prior to initial lease-up of the Project, Developer must submit to Authority for its approval the street address and unit number of the proposed HOME -assisted Units.

Developer may not thereafter change the identity of the HOME-assisted Units without prior written approval by the Authority. Each substituted unit must be comparable to the originally designated HOME-assisted unit in terms of size, features, and number of bedrooms. 179 of 422
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g. Failure to comply with the affordability requirements of this Agreement is an event of default under the terms of the HOME Loan. Pursuant to the HOME Note evidencing the HOME Loan, subject to the right to cure, the HOME Loan will be due and payable immediately if the rents for HOME-assisted Units do not meet the affordability requirements of this Agreement. h. The affordability requirements of this Agreement are in addition to and not in substitution for the affordability requirements set forth in that certain Agreement Containing Covenants (Including Rental Restrictions) attached to the AHA as Attachment No. 10, recorded concurrently with this Agreement.

5. Project Requirements. 24 CFR 92 Subpart F (92.250 - 92.258).

Developer will comply with all applicable requirements set forth in Subpart F of the HOME Regulations, as provided elsewhere in this Agreement and also including the following:

a. Maximum Per-Unit Subsidy. 24 CFR 92.250
. The amount of the HOME
loan may not exceed the per unit dollar limits established by HUD pursuant to section 221(d)(3)(ii) of the National Housing Act, as implemented in regulations issued by HUD, 24 CFR 221.514(b)(1) and (c).
b. Property Standards. 24 CFR 92.251; 24 CFR 92.504 (c)(3)(iv). i. The development and maintenance of the Property will comply with the City’s building code and all other applicable local codes, rehabilitation standards, ordinances and zoning ordinances in effect at the time of project completion, and the Property will be decent, safe and sanitary will conform to the following codes that have been adopted by the City of Glendale: Uniform Building Code (UBC) as adopted by the State of California (California Building Code [Title 24 Part 2], National Electrical Code (NEC), Uniform Plumbing Code (UPC), Uniform Mechanical Code (UMC) and California Energy Code (CEC). ii. The Property will comply with the accessibility requirements at 24 CFR Part 8, which implements Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) and, if applicable, the design and construction requirements at 24 CFR 100.205 for covered multifamily dwellings, as defined at 24 CFR 100.201, which implements the Fair Housing Act (42 U.S.C. 3601-3619).
iii. The Project will comply with the lead -based paint standards in Section 9 2.355. Housing assisted with HOME Program funds constitutes HUD -associated housing for the purpose of Lead-Based Paint Poisoning Prevention Act (42 U.S.C. Section 4821, et seq.) and is, therefore, subject to 24 Code of Federal Regulations Part 35. Accordingly, and pursuant to Section 92.355 of the Regulations, Developer hereby agrees to and will be responsible for testing and abatement activities specified in the Lead -Based Paint Poisoning Prevention Act and the regulations set forth at 24 Code of Federal Regulations Part 25 with respect to the construction of the Property.
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c. T enant Protections. 24 CFR 92.253 . The Developer will comply with the tenant protection provisions of 24 CFR 92.253.
d. Termination of Tenancy. 24 CFR 253(c) . Developer, its successors or assigns, may not terminate the tenancy or refuse to renew the lease of a tenant, except (i) for serious or repeated violation of the terms and conditions of the lease; (ii) for violation of applicable federal, state, or local law; or (iii) for other good cause. Pursuant to 24 C.F.R. 92.253(c), any termination or refusal to renew must be preceded by not less than 30 days by the Developer’s service upon the tenant of a written notice specifying the grounds for the action. e. Converting Rental Units to Homeownership Units for Existing Tenants. 24 CFR 92.255. Conversion of rental units to homeownership units will not be permitted. f. Faith Based Activities. 24 CFR 92.257 . Developer will comply with the restrictions on the use of HOME Funds for faith based activities as set forth in Section 92.257.

Developer hereby certifies that HOME Funds will not be used for the acquisition, construction or rehabilitation of structures to the extent that those structures are used for inherently religious activities. Developer will use the HOME Funds for the construction of structures only to the extent the structures are used for conducting eligible activities under 24 CFR Part 92. g. Affirmative Marketing Requirements. 24 CFR 92.351; 92.504(c)(3)(v) .

Prior to the initial lease-up of the Project, Developer will consult with and obtain the approval of the Authority in developing an affirmative marketing plan for renting the units. The affirmative marketing plan must comply with the requirements of 24 CFR 92.351.

6. Records and Reports. 24 CFR 92.504(c)(3)(vi); 92.508; 92.61.

To assist the Authority in meeting its recordkeeping and reporting requirements, Developer will prepare, maintain and submit to the Authority, as appropriate, the following records and reports:
a. R
ecords which demonstrate that the Property meets the property standards described in Section 5.b;
b. Records which demonstrate, in accordance with 24 CFR 92.203, t hat each family occupying a HOME-assisted Unit is income eligible; c. Records which demonstrate that the Property meets the affordability and income targeting requirements of 24 CFR 92.252 for the Term of this Agreement. Records will be kept for each family in a HOME-assisted Unit;
d. Records which demonstrate that each lease for a HOME -assisted Unit complies with the tenant protections specified in 24 CFR 92.253; e. Equal opportunity and fair housing records, including, as applicable:
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i. data on the extent to which each racial and ethnic group and single- headed household (by gender of household head) have applied for, participated in, or benefitted from, any program or activity funded in whole or in part with HOME funds; ii. documentation of actions undertaken to meet the requirements of 24 CFR Part 135 which implements section 3 of the Housing Development Act of 1968, as amended (12 U.S.C. 1701u);
iii. documentation of actions taken to affirmatively further fair housing with respect to the Project;
f. Affirmative Marketing and MBE/WBE records, including, as applicable:
i. records documenting compliance with the affirmative marketing procedures and requirements of 24 CFR 92.351;
ii. documentation and data on the steps taken by Developer to implement the Authority ’s outreach programs to minority -owned and female -owned businesses including data indicating the racial/ethnic or gender character of each business entity receiving a contract or subcontract of $25,000 or more paid, or to be paid, with HOME funds, the amount of the contract or subcontract, and documentation of the Developer’s affirmative steps to assure that minority business and women’s business enterprises have an equal opportunity to obtain or compete for contracts and subcontracts as sources of supplies, equipment, construction and services;
iii. records which demonstrate compliance with the requirements of 24 CFR 92.353 relating to displacement, relocation and real property acquisition, including project occupancy lists identifying the name and address of all persons occupying or moving into the Property on and after the date on which Developer obtained site control; iv. records demonstrating compliance with the labor requirements of 24 CFR 92.354, including contract provisions and payroll records; g. Records which support any exceptions to the conflict of interest prohibition of 24 CFR 92.356.
h. Debarment and suspension certifications required by 24 CFR Parts 24 and

91. i. Records, data and documentation as required for the Authority’s performance of its rep orting obligations under the Federal Funding Accountability and Transparency Act of 2006 (FFATA), to the full est extent applicable to the Project, which may include but is not necessarily limited to reporting of executive compensation received by 182 of 422
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executives of Developer and/or executives of Developer’s partners or members and/or executives o
f partners or members of any of Developer’s partners or members.

7. Retention and Inspection of Records. 24 CFR 92.504(c) & (d). a. Developer will retain all books and records relevant to the Project for a minimum of five years after the project completion date, except that records of individual tenant income verifications, project rents and project inspections will be retained for the most recent five year period until five ye ars after the affordability period terminates. If any litigation, claim, negotiation, audit, monitoring, inspection, or other action has been started before the expiration of the required record retention period, records must be retained until the completion of the action and resolution of all issues which arise from it, or until the end of the required period, whichever is later.
b. The Authority, HUD and the Comptroller General of the United States, and any of their representatives, will have the right of access to any pertinent books, documents, papers or other records of the Developer, in order to make audits, examinations, excerpts and transcripts.

8. Enforcement of the Agreeme nt. 24 CFR 92.504(c)(3)(vii).

The AHA and all of its attachments, will be enforceable by the Authority in accordance with the terms thereof. Each of the AHA, this Agreement, the HOME Note and the Authority Deed of Trust provide a means of enforcement if the Developer is in breach of its obligations hereunder and thereunder, including liens on the Property, deed restrictions and covenants running with the land. Developer hereby agrees that specific enforcement of its obligations contained herein is the only means by which the Authority may fully obtain the benefits of this Agreement, and Developer therefore agrees to the imposition of the remedy of specific performance against it in the case of uncured default by Developer hereunder. Provided however, the rights and remedies of the Agency are cumulative, and the exercise by the Agency of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by Owner. Failure to comply with the requirements of this Agreement is an event of default under the terms of the HOME Note and the Authority Deed of Trust. Notwithstanding anything to the contrary stated herein, a breach of this Agreement by Developer or its successors and assigns will in no way defeat, invalidate or impair the obligation or priority of any mortgage or deed of trust encumbering the leasehold interest in the Property.

9. Requests for Disbursement of Funds. 24 CFR 92.504(c)(3)(viii).

Developer will not request disbursement of HOME funds until the funds are needed to pay eligible costs. The amount of each disbursement request will be limited to the amount needed. The Authority will have the right to disapprove any request if the Authority determines the request is for an ineligible item or is otherwise not in compliance with or inconsistent with the AHA and this Agreement.
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10. Duration of Agreement. 24 CFR 92.504(c)(3)(ix).

The Agreement will remain in effect for the period of affordability required pursuant to 92.252, and thereafter as set forth in Section 1 of this Agreement.

11. Other Program Requirements. 24 CFR 92, Subpart H (92.350 - 92.358).

Developer will comply with all applicable federal requirements set forth in Subpart H of the HOME regulations, including the following:

a. Other Federal Requirements and Nondiscrimination. 24 CFR 92.350 .

Developer acknowledges that 24 CFR 92.350 provides that the Federal requirements set forth in 24 CFR Part 5, subpart A, are applicable to participants in the HOME program, and that these Federal requirements include the following:
i. Nondiscrimination and Equal Opportunity.
ii. Civil Rights, Fair Housing, and Age and Disability Discrimination Acts Assurances: During the performance of the AHA, Developer will assure that no otherwise qualified person will be excluded from participation or employment, denied program benefits, or be subjected to discrimination based on race, color, national origin, sex, actual or perceived sexual orientation, gender identity, marital status, age, handicap, religion, religious preference or source of income (including but not limited to Section 8 Rental Assistance, Temporary Assistance for Needy Families (TANF), Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI) or earnings from seasonal employment), under any program or activity funded by this Agreement, as required by state law, the Fair Housing Act (42 U.S.C. 3601- 19) and implementing regulations at 24 CFR part 100 et seq., Executive Order 11063 as amended by Executive Order 12259 (3 CFR, 1959-1963 Comp., p. 652 and 3 CFR, 1980 Comp., p. 307) (Equal Opportunity in Housing Programs) and implementing regulations at 24 CFR part 107, title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d- 2000d-4) (Nondiscrimination in Federally Assisted Programs) and implementing regulations at 24 CFR part 1, the Age Discrimination Act of 1975 (42 U.S.C. 6101- 6107) and implementing regulations at 24 CFR part 146, section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 794) and implementing regulations at 24 CFR part 8, Title VI of the Civil Rights Act of 1964, the Fair Housing Act (42 U.S.C. 3601-20) and all implementing regulations, and the Age Discrimination Act of 1975, and all implementing regulations. iii. Training, Employment, and Contracting Opportunities Assurance of Compliance: The Project Activities to be performed under the Agreement are on a project assisted under a program providing direct federal financial assistance from HUD which is subject to the requirements of Section 3 of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701u (“Section 3”), and the regulations issued by HUD to implement Section 3 (24 CFR Part 135) (the “Section 3 Regulations”). Pursuant to 24 CFR 135.3, the requirements of the Section 3 Regulations apply to the recipient of such financial assistance only where the amount of federal 184 of 422
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assistance exceeds $200,000, and apply to a contractor or subcontractor of such recipient only where the amount of assistance exceeds $200,000 and the amount of the contract or subcontrac t exceeds $100,000. Developer will provide, to the greatest extent feasible, training, employment and contracting opportunities generated by the financial assistance to low - and very-low income persons and business concerns owned by low- or very-low income persons, or which employ low- or very-low income persons.
iv. MBE/WBE Affir mative Action Outreach Program: Developer hereby agrees to comply with the Authority’s minority and women business outreach program in accordance with Executive Order 11625, as amended by Executive Order 12007 (3 CFR, 1971- 1975 Comp., p. 616 and 3 CFR, 1977 Comp., p. 139) (Minority Business Enterprises); Executive Order 12432 (3 CFR, 1983 Comp., p. 198) (Minority Business Enterprise Development); and Executive Order 12138, as amended by Executive Order 12608 (3 CFR, 1977 Comp., p. 393 and 3 CFR, 1987 Comp., p. 245) (Women’s Business Enterprise). v. Disclosure Requirements. The disclosure requirements and prohibitions of 31 U.S.C. 1352 and implementing regulations at 24 CFR Part 87; and the requirements for funding competitions established by the Housing and Urban Development Reform Act of 1989 (42 U.S.C. 3531 et seq.).
vi. Debarred, Suspended or Ineligible Contractors. The prohibitions at 24 CFR Part 24 on the use of debarred, suspended or ineligible contractors. vii. Drug-free Workplace. The Drug -Free Workplace Act of 1988 (41 U.S.C. 701 et seq.) and HUD’s implementing regulations at 24 CFR Part 24. b. Affirmative Marketing. 24 CFR 92.351
. Developer will comply with the
Authority’s Affirmative Marketing requirements.
c. Displacement, Relocation and Acquisition. 24 CFR 92.353. Developer will carry out relocation activities in conformance with the relocation plan approved by the Authority and will certify that it has complied with the federal relocation, displacement and acquisition rules governing the HOME Program, which are contained in the Uniform Relocation Act, 49 CFR Part 24, and applicable program regulations. 24 CFR Section 92.353 requires that tenants who are displaced from housing units demolished or converted as a result of HOME -funded activities be provided with relocation assistance.
d. Labor. 24 CFR 92.354. Does not apply to this Project. e. Lead-based Paint. 24 CFR 92.355. The Property will comply with the lead- based paint standards in 92.355, as provided in Section 5.b, above. 185 of 422
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f. Conflict of Interest. 24 CFR 92.356.
i. Interest of Employees, Officers and Officials. No employee, agent, consultant, officer or elected official or appointed official of the Authority , or employee, agent, consultant or officer of Developer, and no other public official of the Authority who exercises any functions or responsibilities with respect to the activities assisted with HOME funds or who are in a position to participate in a decision making process or gain inside information with regard to these activities, during their tenure and for one year thereafter, may obtain a financial interest or benefit from a HOME assisted activity or have an i nterest in any contract or subcontract, or agreement with respect thereto, or the proceeds thereunder, either for themselves or those with whom they have family or business ties. Developer will incorporate, or cause to be incorporated, in all such contractors or subcontracts a provision prohibiting such interest pursuant to the purposes of this Section. Fulfillment of “sweat equity” obligations as defined in Section 8201 of the HOME regulations will not be considered a violation of this prohibition. ii. Prohibition Against Occupying HOME-Assisted Units. No officer, employee, agent, official or consultant of Developer may occupy a HOME-assisted Unit. iii. Consultant Activities. 24 CFR 92.358. No person providing consultant services in an employer-employee type relationship will receive more than a reasonable rate of compensation for personal services paid for with HOME funds. In no event, however, will such compensation exceed the limits in effect under the provisions of any applicable statute (e.g., annual HUD appropriations acts which have set the limit at the equivalent of the daily rate paid for Level IV of the Executive Schedule). Such services will be evidenced by written agreements between the parties which detail the responsibilities, standards and compensation. Consultant services provided under an independent contractor relationship are not subject to the compensation limitation of Level IV of the Executive Schedule.

12. Lobbying Prohibition. 24 CFR 91.225.

Developer hereby certifies to the Authority, under penalty of perjury, under the terms of applicable federal law, that at all applicable times before, during and after the term of this Agreement:

a. No Federal appropriated funds have been paid or will be paid, by or on behalf of it, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of a ny Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement; and
b. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member 186 of 422
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of Congress in connection with this Federal contract, grant, loan, or cooperative agreement, Developer will complete and submit Standard Form-LLL, “Disclosure Form to Report Lobbying,” in accordance with its instructions; and
c. Developer will require that the above stated language in paragraphs a. and b. be included in the award documents for all subawards at all tiers, including subcontracts, subgrants, loans, contracts, and cooperative agreements concerning the subject matter of this Agreement; and
d. Further, Developer and all subawards at all tiers, including subcontracts, subgrants, loans, contracts, and cooperative agreements concerning the subject matter of this Agreement, at all times, will certify compliance with the provisions of 31 U.S.C. §1352 and any and all terms and conditions of the Byrd Anti -Lobbying Amendment, as amended from time to time.

[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK; SIGNATURES ON FOLLOWING PAGES]

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13. Execution in Counterparts.

This Agreement may be executed by each party on a separate signature page, and when the executed signature pages are combined, will constitute one single instrument.

IN WITNESS WHEREOF, the Authority and the Developer have executed this Agreement.

THE HOUSING AUTHORITY OF THE

CITY OF GLENDALE

By: ____________________________
Roubik R. Golanian, P.E.

Executive Director

APPROVED AS TO FORM AND LEGALITY:

MICHAEL J. GARCIA, CITY ATTORNEY
General Counsel to the Authority

By:________________________________
Michael J. Garcia

APPROVED AS TO FORM:

KANE, BALLMER & BERKMAN
Special Counsel to the Authority

By: ___________________________

[SIGNATURES CONTINUE ON FOLLOWING PAGE]

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“DEVELOPER”

900 E BROADWAY, L.P.,
a California limited partnership

by: 900 E Broadway, LLC,
a California limited liability company,
its Administrative General Partner

by: Meta Development, LLC,
a California limited liability company,
its Administrative General Partner

By:___________________________
Kasey Burke
Manager

by: WCH Affordable LXIII, LLC,
a California limited liability company,
its Managing General Partner

By:___________________________
Graham Espley-Jones
President
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Exhibit A – Legal Description

Exhibit A

LEGAL DESCRIPTION OF PROPERTY
A leasehold interest created by that certain Ground Lease between the Housing Authority of the City of Glendale and 900 E BROADWAY, L.P., dated as of _______________, 2021 in the real property described as follows:

LOTS 2, 4, 6, 8 AND 10 IN BLOCK 17 OF TO WN OF GLENDALE, IN T HE CITY OF

GLENDALE, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 14 PAGE 95, ET SEQ., AND IN BOOK 52 PAGE 8 OF

MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE NORTH 20 FEET OF LOT 2 CONDEM NED BY THE CITY OF G LENDALE FOR STREET PURPOSES.

APN: 5674-010-900
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Exhibit B – Affordability Requirements
Exhibit B

Affordability Requirements
(24 CFR 92.252; 92.504(c)(3)(iii))

Developer will submit its rent schedule and utility allowances thirty (30) days prior to initial rental of the HOME -assisted U nits and on an annual basis thereafter. The Authority will review and approve or disapprove the proposed rent schedule and utility allowances for compliance with the maximum rent limitations contained in 24 CFR 92.252.

The Authority will provide updated HUD income and rent limits to Developer as they become available. As of the date of this Agreement, the applicable income and rent limits are as follows:

2021 HOME Program Income Limits

Household Size Very Low Income
1 $41,400
2 $47,300
3 $53,200
4 $59,100

Los Angeles County
2021 HOME Program Rent Limits

Efficiency/Studios 1 Bedroom

Very Low Income $1,035 $1,108

For comparison purposes
:

Fair Market Rent $1,369 $1,605 65% Rent Limit $1,325 $1,421 50% Rent Limit $1,035 $1,108

Developer will be responsible for ensuring that the current operative HOME income and rent limits in effect at the time of the tenant’s rental application for HOME-assisted Units will be used to determine initial tenant eligibility and conformance with HOME affordability requirements and that each tenant recertification is conducted using current HOME income and rent limits to assure compliance with HOME Regulations.

Income determination and rental rate adjustments will occur upon annual lease renewal. Any increase in rents for HOME-assisted Units is subject to the provisions of existing leases, including 191 of 422
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Exhibit B – Affordability Requirements
the provision that rents may not be adjusted until leases are renewed. Developer must provide tenants with not less than thirty (30) days prior written notice before implementing any increase in rents.
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LMIHAF Note

PROMISSORY NOTE

TO THE HOUSING AUTHORITY

OF THE CITY OF GLENDALE
(LMIHAF)
3% Int
erest Glendale, California
$1,725,000 __________ , 202_

FOR VALUE
RECEIVED, 900 E BROADWAY, L.P., a California limited partnership (“Borrower”), hereby promises to pay to the HOUSING AUTHORITY OF THE CITY OF GLENDALE (“Authority”), a public body, corporate and politic, or order, a principal amount of One Million Seven Hundred Twenty -Five Thousand Dollars and 0/100 ($1,725,000), being the principal amount of the Authority’s loan of LMIHAF c onstruction to permanent funds (the “LMIHAF Loan”). This Note is given pursuant to that certain Affordable Housing Agreement dated as of ________________, 2021, between Borrower and the Authority (the “Affordable Housing Agreement”) and evidences the LMIHAF Loan to Borrower, which provides part of the financing for the acquisition and development of that certain real property located at 900 East Broadway in the City of Glendale, legally described in the Deed of Trust securing this Note (the “Property”). The obligation of Borrower to Authority hereunder is subject to the terms of the Affordable Housing Agreement, this Note and the following instruments, each dated on or about the date hereof, and, where applicable, executed and delivered by Borrower for the purpose of securing this Note: an Agreement Containing Covenants (Including Rental Restrictions) (“Agreement Containing Covenants ”); a Subordinate d Leasehold Deed of Trust, Security Agreement and Fixture Filing (With Assignment of Rents) ( “Authority Deed of Trust ”); an Assignment of Rents and Leases ( “Assignment of Rents ”); an Assignment of Agreements (“Assignment of Agreements”); and a UCC-1 Financing Statement. Said documents are public records on file in the offices of Authority , and the provisions of said documents are incorporated herein by this reference. The Borrower will pay interest at the rate, in the amount and at the time hereinafter provided.

1. C apitalize
d terms not otherwise defined herein will have the meaning ascribed to such term s in the Affordable Housing Agreement. In addition, the following terms have the following meanings:
“Acquisition and Development Costs” means the total cost of acquiring the Property and developing and constructing the Improvements thereon in accordance with the Affordable Housing Agreement.
“Affiliat
e” means any Person directly or indirectly controlling, controlled by or under common control with another Person. The term “control” as used in the immediately preceding sentence, means the power to direct the management or the power to control election of the board of directors. It will be a presumption that control with respect to a corporation or limited liability company is the right to exercise or control, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with Attachment No. 12
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respect to any individual, partnership, trust, other entity or association, control is the possession, indirectly or directly, of the power to direct or cause the direction of the management or policies of the controlled entity. For purposes of this definition, each general partner will be considered an “Affiliate” of Borrower.

“ Annual Financial Statement” means the annual audited financial statement of Revenue and Operating Expenses and balance sheet for the Improvements, prepared at the Borrower’s expense, by an independent certified public accountant reasonably acceptable to the Authority, which will form the basis for determining the Residual Receipts.

“ Authority Deed of Trust ” means the Subordinated Leasehold Deed of Trust, Security Agreement and Fixture Filing (with Assig nment of Rents) executed by Borrower in favor of Authority and dated on or about the date hereof, which secures this Note and the LMIHAF Loan evidenced hereby.

“Authority’s Share of Residual Receipts” will have the meaning set forth in Section 8, below.

“Construction Financing Event” means the point in time when all conditions precedent to the release of the Construction Loan funds and the Authority Loan funds have been satisfied, in accordance with the Affordable Housing Agreement.

“ Construction Loan” means the Construction Period loan to be made to Owner by Bank of America, NA, in its capacity as Servicer of the Construction Period loan (together with its successors and assigns, “Construction Lender”) at the time of the Construction Financing Event, secured by the Construction Loan Deed of Trust.

“ Construction Loan Deed of Trust ” means the deed of trust securing the Construction Loan that is first in priority.

“ Construction Period ” means the period of time commencing upon the Construction Financing Event and ending upon the repayment of the Construction Loan and the funding of the Permanent Loan.

“ Conversion” means the point in time when the Permanent Loan has been funded, the additional Limited Partner Capital Contribution has been funded (less that portion, not to exceed 10%, of the Limited Partner Capital Contribution that will be funded upon receipt of Form(s) 8609), and the Construction Loan has been repaid in full.

“Deferred Developer Fee” means that portion of the Developer Fee which was not paid prior to the date of Conversion and which will be paid from the Revenue remaining after payment of Operating Expenses, prior to any payment of Residual Receipts to the Authority. The term “Deferred Developer Fee” will include any loan or capital contribution made by a partner of Borrower to pay such deferred fee.

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“Developer Equity” means funds provided by the Borrower for payment of Acquisition and Development Costs and will not include the Senior Loan, the LMIHAF Loan, the Measure S Loan, the HOME Loan, or any other borrowed funds, and will include the Deferred Developer Fee, the Investor Limited Partner’s capital contribution, as well as any other funds of the Borrower.

“Developer Fee” means the fee in the amount set forth in the Project Budget.

“Environmental Indemnity” means the indemnity in the form attached to the Affordable Housing Agreement as Attachment No. 18, which is incorporated herein by this reference.

“ HOME Loan” means the loan from the Authority to Borrower pursuant to the Affordable Housing Agreement as amended from time to time , in the amount of $1,800,000, which is evidenced by the HOME Loan Note and secured by the lien of the Authority Deed of Trust that is second in priority to the lien of the Senior Loan Deed of Trust.

“HOME Note” means the Promissory Note dated as of the date hereof , evidencing the HOME Loan.

“Improvements” means the 127-unit residential development and ancillary facilities to be constructed on the Property, all as described in the Affordable Housing Agreement.

“ Investor Limited Partner” means Bank of America, N.A., a national banking association, and Banc of America CDC Special Holding Company, Inc. a North Carolina corporation and each of its authorized successors and assigns.

“LMIHAF Loan” means the loan made by the Authority to Borrower in the maximum amount of $1,725,000, which is evidenced by this Note and secured by the Authority Deed of Trust.

“LMIHAF Loan Documents ” means this Note, the Authority Deed of Trust, the Agreement Containing Covenants, the Assignment of Rents, the Assignment of Agreements, the Environmental Indemnity, and the UCC-1 Financing Statement, each dated on or about the date hereof.

“ LMIHAF Note” means this Note dated as of the date hereof , evidencing the LMIHAF Loan.

“ Low Income Housing Tax Credits” means tax credits authorized by the Tax Reform Act of 1986 and governed by Section 42 of the Internal Revenue Code.

“Measure S Loan” means the loan made by the Authority to Borrower in the maximu m amount of $11,525,000, which is evidenced by the Measure S Note and secured by the Authority Deed of Trust.

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“Measure S Note” means the Promissory Note dated as of the date hereof, evidencing the Measure S Loan.

“Net Proceeds” means the proceeds of a sale, transfer or refinancing, less the customary and reasonable costs of the transaction.

“Operating Expenses” means actual, reasonable and customary costs, fees and expenses directly attributable to the operation, maintenance and mana gement of the Property that are consistent with an annual independent audit performed by a certified public accountant using generally accepted accounting principles, expressly including, without limitation, payment of the following:

a. Principal and interest and all periodic fees and costs due and payable on the Senior Loan;
b. Property and other taxes and assessments imposed on the Project; c. A general partner partnership management fee to the general partners of Borrower not to exceed $ 7,500 per year, to be increased at an annual rate of three percent (3%), which will accrue to the extent not paid;
d. General administrative expenses including but not limited to advertising and marketing, security services and systems and similar customary administrative expenses;
e. Maintenance and repair including but not limited to pest control, landscaping and grounds maintenance, painting and decorating, cleaning, common systems repairs, general repairs, janitorial, supplies, and similar customary services; f. Cash deposited into a replacement reserve fund in the amount of $250 per unit per year, to be increased at an annual rate of three percent (3%); g. Cash deposited into an operating reserve fund in such reasonable amounts as are required by Project lenders, the C alifornia Tax Credit Allocation Committee, and the Investor Limited Partner from time to time, and approved by the Authority; h. Utility services not paid for directly or reimbursed by tenants, including but not limited to water, sewer, trash collection, gas and electricity; i. License or certificate of occupancy fees required for operation of the Project; j. Premiums for property damage and liability insurance; k. Cable television, satellite and similar services;
l. Recreational amenities, supplies and services;
m. Reasonable property management fee payable to a third party property manager acceptable to the Authority in an annual amount equal to [$____] per unit, to be increased at an annual rate of [______________] percent (___%), and pursuant to a management contract approved by the Authority;
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n. A reasonable resident services coordinator fee payable to a coordinator acceptable to the Authority;
o. Purchase, repair, servicing and installation of appliances, equipment, fixtures and furnishings (other than from reserves);
p. Fees and expenses of accountants, attorneys, consultants and other professionals, including annual audits and tax return preparation costs payable to a third party; and
q. An Asset Management Fee to Borrower’s Limited Part ner in an amount not to exceed $7,500 per year, to be increased at an annual rate of three percent (3%); and r. A Project monitoring fee to the Authority in an amount equal to $18,900 per year.

Operating Expenses will not include the following: depreciation, amortization, depletion or other non-cash expenses, any amount expended from a reserve account, or the repayment under Borrower’s partnership a greement of operating expense loans or development deficit loans .

Operating Expenses will be subject to the reasonable approval of the Authority.

“ Permanent Loan” means the initial permanent loan to be made to Borrower by Citibank, NA (together with its successors and assigns, “ Permanent Lender”) at Conversion, secured by the Permanent Loan Deed of Trust.

“ Permanent Loan Deed of Trust ” means the leasehold deed of trust securing the Permanent Loan that is first in priority.

“ Permanent Period” means the period of time commencing upon the repayment of the Construction Loan and the funding of the Permanent Loan and payment of the Limited Partner Capital Contribution.

“ Permitted Transfer” means any of the following, provided (except for subsection f. below) Borrower, a general partner of Borrower, or an Affiliate of such general partner, retains day-to-day control over management and operations of the Property and the Improvements and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti - Terrorism Laws:
a. An assignment of the Affordable Housing Agreement and Borrower’s interests in the Property to an Affiliate or a conveyance back from the Affiliate to Borrower; b. A conveyance of a security interest in the Property or any portion thereof or interest therein, in connection with a Senior Loan;
c. The inclusion of equity participation in the Project by addition of limited partners to Borrower’s Partnership or similar mechanism, and transfers of limited partnership interests in Borrower’s partnership;
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d. The lease for occupancy of all or any par t of the Improvements on the Property in accordance with the Affordable Housing Agreement;
e. The granting of easements or permits to facilitate the development of the Property in accordance with the Affordable Housing Agreement;
f. The withdrawal, removal and/or replacement of a general partner of Borrower’s partnership pursuant to the terms of Borrower’s partnership agreement, or a conveyance of Borrower’s interest in the Property and the Improvements and/or a transfer of limited partnership interests to a gene ral partner or an affiliate of Meta Development LLC pursuant to the option provided to that partner in Borrower’s partnership agreement, will not constitute a default under this Agreement or any of the LMIHAF Loan Documents, nor will such actions accelerate the maturity of the LMIHAF Loan, provided that any required substitute general partner is reasonably acceptable to the Authority, as evidenced by the Authority’s written consent, and is selected with reasonable promptness; and
g. A transfer approved in writing by Authority’s Executive Director or designee, at his or her sole discretion.

A transfer described in clauses a., b. or c. will be subject to the reasonable approval of the Authority Executive Director or designee; provided that, t he Authority approves the transfer of limited partner interests in Borrower’s partnership, so long as such transfer is not a result of a resyndication of the Low Income Housing Tax Credits and does not otherwise result in increased equity participation in Borrower, and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti-Terrorism Laws.

“ Person” means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, domestic or foreign.

“ Property” means the real property described as the “Property” in and legally described as set forth in Exhibit “A” of the Authority Deed of Trust.

“ Residual Receipts” means the Revenue minus the Operating Expenses, calculated on a 12-month basis, minus the theretofore unpaid portion of the Deferred Developers Fee. All calculations of Residual Receipts will be subject to verification and reasonable approval by the Authority.

“ Revenue” means the gross rental income from the Improvements, and any other income to the Borrower derived from the ownership, operation and management of the Property, including but not limited to the following: all rents, fees and charges paid by tenants, Section 8 payments or other rental subsidy payments received for the dwelling units, deposits forfeited by tenants, all cancellation fees, price index adjustments and any other rental adjustments to leases or rental agreements; proceeds from vending and laundry room machines; the proceeds of business interruption or similar insurance; the proceeds of casualty insurance to the extent not utilized to repair or rebuild the Project; and condemnation awards for a taking of part or all of the Project for 198 of 422
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a temporary period. “Revenue” will also include the fair market value of any goods or services provided in consideration for the leasing or other use of any portion of the Project, except that the value of services provided by on-site manager(s) will not be treated as “Revenue” if no more than one dwelling unit is leased to or otherwise used by on-site manager(s). “Revenue” will not include tenants’ security deposits, proceeds from the Senior Loan, the Authority Loan, Developer Equity, including capital contributions or similar advances, or interest that is earned on and allocated to reserve accounts.

“ Senior Loan” means the Construction Period loan made by Construction Lender (in its capacity as Servicer of the Construction Period loan) to Borrower in the approximate amount of [$35,000,000] and the Permanent Loan to be made by Permanent Lender to Borrower to repay all or part of the Construction Loan in the approximate amount of [$17,700,000] which will be secured by a deed of trust that is senior and superior to the Authority Deed of Trust, or any other loan secured by a deed of trust or other instrument to which the Authority agrees, in its sole discretion, to subordinate this Note and the Authority Deed of Trust.

“ Term” of this Note means a term that expires on the fifty -fifth (55th) anniversary of the date of Conversion.

“ Transfer” will have the meaning set forth in Section 11.e of this Note.

2. This Note evidences the obligation of the Borrower to the Housing Authority for the repayment of the LMIHAF Loan. None of the funds provided pursuant to the LMIHAF Loan were funded directly or indirectly with any obligation the interest on which is exempt from tax under Section 103 of the Internal Revenue Code of 1986, as amended, or pursuant to any United States government federal source.

3. This Note is payable at the principal o ffice of Authority, 141 North Glendale Avenue, Glendale, California 9 1206, or at such other place as the holder hereof may inform the Borrower in writing, in lawful money of the United States.

4. This Note is secured by the Authority Deed of Trust.

5. This Note will bear three percent (3%) simple interest.

6. Except in the event of a default described in Section 7 hereof, no payments will be due and payable under this Note except to the extent of (a) the Authority’s share of Residual Receipts as described in Section 8, below, and (b) any refinancing, Cost Savings or Additional Proceeds, subject to the limitations set forth in Section 10, below.

7. The entire unpaid principal balance of this Note and any accrued but unpaid interest will be due and payable upon the expiration of the Term hereof, or immediately upon the occurrence of either of the following:
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a. if the Property or any portion thereof or interest therein is sold, transferred, assigned or refinanced, without the prior written approval of the Authority , except as otherwise permitted in this Note; or
b. if there is a default by the Borrower under the terms of this Note, the Authority Deed of Trust, the A ffordable Housing Agreement , the Agreement Containing Covenants, or any deed of trust or other instrument securing the Senior Loan or other obligations secured by a deed of trust on the Property, which is not cured within the respective time period provided herein and therein.

8. Prior to the expiration of the Term hereof, Borrower will be obligated to repay the LMIHAF Loan exclusively from the Authority’s share of Residual Receipts, as follows:
a. Annually, not later than the thirtieth (30th) day of April, beginning with the year following the year in which Conversion occurs, Borrower will submit to Authority an audited Annual Financial Statement for the preceding calendar year, prepared by a certified public accountant reasonably acceptable to the Authority, determining the amount of Residual Receipts, if any, generated in that year, together with payment of the Authority’s Share of such Residual Receipts. The first such Annual Financial Statement will be for the partial year beginning on the date of Conversion and ending on December 31 of that year. The Authority will review and approve such Annual Financial Statement, or request reasonable revisions, within 30 days after receipt. If as the result of the Authority’s review of the statement, there is an increase in the amount of any payment due and payable to Authority (as the result, for example, of a determination that the actual amount of Residual Receipts to which the Authority is entitled exceeds the amount o f Authority’s share of Residual Receipts shown in the Annual Financial Statement submitted by Borrower), Borrower will promptly pay to the Authority the difference, with interest, from the date on which such payment was due, at the rate of one percent (1%) over the Prime Rate announced by Bank of America, but in any event within ten (10) days of notice of such increase. b. The Authority’s Share of Residual Receipts to be applied to the Home Note, the LMIHAF Note, and the Measure S Note will be 50%. The Authority’s Share of Residual Receipts will be applied to the HOME Note, this Note, and the Measure S Note as follows: 11.96% (i.e., $1,800,000/$ 15,050,000) will be applied to th e HOME Note, 11.46% (i.e., $1,725,000/$15,050,000) will be applied to this Note, and 76.58% (i.e., $11,525,000/$15,050,000) will be applied to the Measure S Note.

9. All payments applie d to this Note will be applied first to penalties and late fees, then to interest, then to reduce the principal amount owed.

10. The LMIHAF Loan evidenced by this Note is based on the assumption that, upon completion and stabilization, all Acquisition and Development Costs will be $59,761,000 and the maximum amount of the Permanent Loan to be secured by a first priority deed of trust will be $___________. To induce Authority to make the LMIHAF Loan evidenced hereby, Borrower covenants and agrees as follows:
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a. If Borrower obtains a Permanent Loan in a principal amount in excess of $[16,950,000], Borrower will apply an amount equal to fifty percent (50%) of the proceeds thereof in excess of $[16,950,000] (the “Additional Proceeds ”) to pay accrued interest on, and then reduce the princip al amount of the LMIHAF Loan, the Measure S Loan, and the HOME Loan, except to the extent such Additional Proceeds are needed to either pay for cost overruns for which no other funds are available (other than from Borrower’s general partners) or to compensate for reductions in other permanent financing sources. If at any time Borrower refinances the Permanent Loan, Borrower will apply the Net Proceeds of any such refinancing first to pay previously incurred Operating Expenses (as defined above) still owing, then fifty percent (50%) of the balance will be paid to the Authority to pay accrued interest on, and then reduce the princi pal amount of the LMIHAF Loan, the Measure S Loan, and the HOME Loan. b. If, there are Cost Savings with respect to the Project, the following will occur: (1) to the extent of fifty percent (50%) of the Cost Savings, any undisbursed amount of the Authority Loan plus any undisbursed capital contributions made by Borrower’s Investor Limited Partner will be released to the Authority as a payment of accrued interest on and then reduction of the principal amount of the Authority Loans; and (2) each Lender’s unfunded commitment will terminate. For purposes hereof, “Cost Savings”, shall mean the difference between the total sources of funds and the total cost of development as shown in the Borrower’s cost certification contained in Borrower’s application to the California Tax Credit Allocation Committee for a Form 8609 for the Project (“Tax Credit Report”); provided, however, the Cost Savings will be adjusted to take into account (i) the loss of any equity investment due to an adjustment in the allowable tax credits; provided that the tax credit factor applied to the required equity contribution will be as set forth in Borrower’s limited partnership agreement; and (ii) any reduction in the first mortgage loan required by the Senior Loan Documents. The amount payable to Authority under this paragraph will be paid within sixty (60) days following submittal of the Tax Credit Report to the California Tax Credit Allocation Committee.

11. Prohibitions on Transfer.
a. Prior to the repayment in full of the LMIHAF Loan and expiration of the Term of the Agreement Containing Covenants , the Borrower must not , except for Permitted Transfers or as permitted by the Affordable Housing Agreement, assign or attempt to assign the Affordable Housing Agreement or this Note or any right therein or herein, nor make any total or partial sale, transfer, conveyance or assignment of the whole or any part of the Property (referred to hereinafter as a “Transfer”), without prior written approval of the Authority, except as expressly permitted by th e Affordable Housing Agreement or this Note. Consent to one such transaction will not be deemed to be a waiver of the right to require consent to future or successive transactions. Authority shall not unreasonably withhold or delay its consent. If consent should be given, any such transfer shall be subject to this Section 11, and any such transferee shall assume all obligations hereunder and agree to be bound by all provisions contained herein. b. Proposed transferees (other than an Affiliate of Borrower) must have the qualifications and financial responsibility necessary and adequate as may be reasonably determined by the Authority, to fulfill Borrower’s obligations undertaken in the Affordable 201 of 422
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Housing Agreement, the Agreement Containing Covenants, and this Note. A proposed transferee (including an Affiliate of Borrower), by instrument in writing satisfactory to the Authority and in form recordable among the land records, for itself and its successors and assigns, and for the benefit of the Authority must expressly assume all of Borrower’s obligations under the Affordable Housing Agreement, the Agreement Containing Covenants, and this Note and agree to be subject to all conditions and restrictions applicable to Borrower. There must be submitted to the Authority for review all instruments and other legal documents proposed to affect any such transfer; and if approved by the Authority its approval will be indicated to Borrower in writing. If consent should be given, such transfer will be subject to this Section 11. Authority shall not unreasonably withhold or delay its consent. If consent should be given, any such transfer shall be subject to this Section 11, and any such transferee shall assume all obligations hereunder and agree to be bound by all provisions contained herein
c. In the absence of specific written agreement by the Authority , no unauthorized Transfer, or approval thereof by the Authority , will be deemed to relieve the Borrower or any other party from any obligations under the A ffordable Housing Agreement, the Agreement Containing Covenants, or this Note.
d. In the event of a Transfer prior to the time the LMIHAF Loan is paid in full without
the prior written consent of the Authority, the remaining principal balance of the LMIHAF Loan and all accrued but unpaid interest will be immediately due and payable. e. As used herein, “Transfer” means
i. the sale, agreement to sell, transfer or conveyance of the Property, the Project, or any portion thereof or interest therein (including, without limitation, a beneficial interest), whether voluntary, involuntary, by operation of law or otherwise, the execution of any installment sale contract or similar instrument affecting all or a portion of the Property or Project, or the lease of all or substantially all of the Property or Project. ii. “Transfer” also includes the transfer, assignment, hypothecation or conveyance of legal or beneficial ownership of an interest in Borrower, or a conversion of Borrower to an entity form other than that of Borrower at the time of execution of the Affordable Housing Agreement, except that, a cumulative change in ownership interest of a general partner of Borrower of forty-nine percent (49%) or less will not be deemed a “Transfer” for purposes of this Note.

12. The Authority will not unreasonably withhold, condition, or delay its approval of any matter for which its appr oval is required hereunder. The Authority’s disapproval will be in writing and contain the Authority’s reasons for disapproval.

13. The LMIHAF Loan is funded from the Authority’s LMIHAF funds. Accordingly, Borrower agrees for itself, its successors and assigns that the use of the property will be subject to the restrictions on rent and occupancy set forth in the Agreement Containing Covenants. 202 of 422
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14. Subject to the provisions and limitations of this Section 14, the obligation to repay the LMIHAF Loan is a nonrecourse obligation of the Borrower. Borrower and each general partner or limited partner of Borrower will not have any personal liability for repayment of the loan, except as provided in this Section 14. The sole recourse of Authority will be the exercise of its rig hts against the Property and other security for the LMIHAF Loan. Provided, however, that the foregoing will not (a) constitute a waiver of an obligation evidenced by this Note or the Authority Deed of Trust; (b) limit the right of the Authority to name Borrower as a party defendant in any action or suit for judicial foreclosure and sale under this Note and the Authority Deed of Trust or any action or proceeding hereunder so long as no judgment in the nature of a deficiency judgment will be asked for or taken against Borrower; (c) release or impair this Note or the Authority Deed of Trust; (d) prevent or in any way hinder the Authority from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, any other remedy again st the mortgaged Property or other instrument securing the N ote or as prescribed by law or in equity in case of default; (e) prevent or in any way hinder the Authority from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of , its remed ies in respect of deposits, insurance proceeds, condemnation awards or other monies or other collateral or letters of credit securing this Note; (f) relieve Borrower of its obligations under an indemnity delivered by Borrower to Authority; or (g) affect in any way the validity of a guarantee or indemnity from any person of all or any of the obligations evidenced and secured by this Note and the Authority Deed of Trust. The foregoing provisions of this paragraph are limited by the provision that in the event of the occurrence of a default, Borrower and its successors and assigns will have personal liability hereunder for any deficiency judgment, but only if and to the extent Borrower, its principals, shareholders, partners or its successors and assigns recei ved rentals, other revenues, or other payments or proceeds in respect of the mortgaged Property after the occurrence of such default, which rentals, other revenues, or other payments or proceeds have not been used for the payment of ordinary and reasonable operating expenses of the mortgaged Property, ordinary and reasonable capital improvements to the mortgaged Property, debt service, real estate taxes in respect of the mortgaged Property and basic management fees, but not incentive fees, payable to an ent ity or person unaffiliated with Borrower in connection with the operation of the mortgaged Property, which are then due and payable. Notwithstanding the first sentence of this paragraph, Authority may recover directly from Borrower or from any other party (other than Borrower’s Investor Limited Partner):
a. damages, costs and expenses incurred by the Authority as a result of fraud or criminal act or acts of Borrower or a partner, shareholder, officer, director or employee of Borrower, or of a member or general or limite d partner of Borrower, or of a general or limited partner of such member or general or limited partner;
b. damages, costs and expenses incurred by Authority as a result of misappropriation of funds provided for the payment of Acquisition and Development Costs , as described in the A ffordable Housing Agreement, rents and revenues from the operation of the Project, or proceeds of insurance policies or condemnation proceeds; c. all amounts owing by Borrower pursuant to the indemnification regarding Hazardous Substances under the Environmental Indemnity, and 203 of 422
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d. all court costs and attorneys ’ fees reasonably incurred in enforcing or collecting upon any of the foregoing exceptions (provided that Authority will pay Borrower ’s reasonable court costs and attorneys’ fees if Borrower is the prevailing party in such enforcement or collection action).

15. Borrower waives presentment for payment, demand, protest, and notices of dishonor and of protest; the benefits of all waivable exemptions; and all defenses and pleas on the ground of an extension or extensions of the time of payment or of a due date under this Note, in whole or in part, whether before or after maturity and with or without notice. Borrower hereby agrees to pay all costs and expenses, including reasonable attorney’s fees, which may be incurred by the holder hereof, in the enforcement of this Note, the Authority Deed of Trust or any term or provision of either thereof.

16. Upon the failure of Borrower to perform or observe a term or provision of this Note, or upon the occurrence of an event of default under the terms of the Authority Deed of Trust, the Affordable Housing Agreement, the Agreement Containing Covenants, or a deed of trust securing a Senior Loan, or other obligations secured by a deed of trust on the Property, and after expiration of the applicable cure period, the holder may exercise its rights or remedies hereunder or thereunder.

17. Defaults and Remedies.
a. Subject to the extensions of time set forth in Section 18, and subject to the further provisions of this Secti on 17, failure or delay by Borrower to perform a material term or provision of this Note, the Authority Deed of Trust, the A ffordable Housing Agreement, the Agreement Containing Covenants, or a deed of trust securing a Senior Loan, or other obligations secured by a deed of trust on the Property, constitutes a default under this Note. b. The Authority will give written notice of default to Borrower, specifying the default complained of by the Authority. Delay in giving such notice will not constitute a waiver of any default nor will it change the time of default.
c. Failures or delays by the Authority in asserting its rights and remedies as to a default will not operate as a waiver of default or of such rights or remedies. Delays by the Authority in asserting its rights and remedies will not deprive the Authority of its right to institute and maintain actions or proceedings which it may deem necessary to protect, assert, or enforce such rights or remedies.
d. If a monetary event of default occurs under the terms of this Note or the Authority Deed of Trust, or a deed of trust securing a Senior Loan, or other obligations secured by a deed of trust on the Property, prior to exercising its remedies hereunder or thereunder the Authority will give Borrower, each general partner, and the Investor Limited Partner, concurrent written notice of such default. Borrower will have a reasonable period of time after such notice is given within which to cure the default prior to exercise of remedies by the Authority under this Note and the Authority Deed of Trust. In no event will the Authority be precluded from exercising remedies if its security becomes or is about to become materially impa ired by a failure to cure a 204 of 422
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default or the default is not cured within ten (10) calendar days after the notice of default is received or deemed received.
e. If a non-monetary event of default occurs under the terms of the Affordable Housing Agreement, this Note, the Authority Deed of Trust, the Agreement Containing Covenants, or a document implementing the A ffordable Housing Agreement or a deed of trust securing a Senior Loan or other obligations secured by a deed of trust on the Property, prior to exercising its remedies hereunder or thereunder, the Authority will give Borrower, each general partner, and the Investor Limited Partner, concurrent notice of such default. If the default is reasonably capable of being cured within thirty (30) calendar days after such notice is received or deemed received, Borrower will have such period to effect a cure prior to exercise of remedies by the Authority under the Affordable Housing Agreement, the Agreement Containing Covenants, this Note and/or the Authority Deed of Trust. If the default is such that it is not reasonably capable of being cured within thirty (30) days, and Borrower (i) initiates corrective action within said period, and (ii) diligently and in good faith works to effect a cure as soon as possible, then Borrower will have such additional time as is reasonably necessary to cure the default prior to the Authority’s exercise of remedies. If Borrower fails to take corrective action or to cure the default within the time set forth above in this Subsection 17.e, the Authority will give Borrower , the Senior Lender , the Investor Limited Partner written notice thereof, whereupon the Investor Limited Partner, subject to the terms of Borrower’ s partnership agreement, may take such corrective action, including removing and replacing a general partner. The Investor Limited Partner will have 45 days, or such longer period as is approved by the Authority Executive Director or designee, to remove and replace such general partner of Borrower. The Authority agrees to accept cures tendered by a Senior Lender or the Investor Limited Partner within the time period provided herein. Additionally, in the event the Senior Lender , or Investor Limited Partner is precluded from curing a non - monetary default due to a bankruptcy, injunction, or similar proceeding by or against Borrower or a general partner , the Authority agrees to forbear from completing a foreclosure (judicial or nonjudicial) during the period during which such party is so precluded from acting, not to exceed 90 days or such additional time as is reasonably approved by the Authority Executive Director or designee, provided such Senior Lender or Investor Limited Partner is otherwise in compliance with the foregoing provisions. In no event will Authority be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by a failure to cure a default or the default is not cured within one hundred eighty (180) days after the notice of default is received or deemed received or such additional time as is reasonably approved by the Authority Executive Director or designee.
f. A notice of default that is transmitted by electronic facsimile transmission followed by delivery of a “hard” copy, will be deemed delivered upon its transmission; a notice of default that is personally delivered (including by means of professional messenger service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal Service), will be deemed received on the documented date of receipt by Borrower; and a notice of default that is sent by registered or certified mail, postage prepaid, return receipt required will be deemed received on the date of receipt thereof. Notices to the limited partner will be sent to the following address:
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To Authority: HOUSING AUTHORITY OF

THE CITY OF GLENDALE
141 N. Glendale Avenue, Room 202,
Glendale, California 91206
Attention: Executive Director
Facsimile: 818-548-3724

With a copy to: KANE, BALLMER & BERKMAN
515 S. Figueroa St., Suite 780
Los Angeles, California 90071-3301
Attention: Susan Apy

To Borrower: 900 E BROADWAY, L.P.
c/o Meta Housing Corporation
1150 W. Olympic Blvd., Suite 620
Los Angeles, California 90064
Attention: President

With a copy to:

Bank of America, N.A.

MA1-225-02-02
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Facsimile: 617-346-2257

And:

Banc of America CDC Special Holding Company, Inc.

MA1-225-02-02
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Facsimile: 617-346-2257

And:

Buchalter, a Professional Corporation
1000 Wilshire Boulevard, Suite 1500
Los Angeles, CA 90017
Attn: Michael A. Williamson, Esq.

Facsimile: (213) 630-5799
Matter No: B0965-0629

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18. Notwithstanding specific provisions of this Note, Borrower will not be deemed to be in default for failure to perform a non-monetary obligation hereunder where delays or defaults are due to war, insurrection, strikes, lock- outs, riots, floods, earthquakes, fires, casualties, acts of God, acts of the public enemy, epidemics, quarantine restrictions, freight embargoes, lack of transportation, governmental restrictions or priority, litigation, unusually severe weather, inability to secure necessary labor, material or tools, delays of any contractor, sub -contractor or supplier, acts of the Authority or any other public or governmental Authority or entity, or any causes beyond the control or without the fault of the Borrower. An extension of time for any such cause (a “Force Majeure Delay”) will be for the period of the enforced delay and will commence to run from the time of the commencement of the cause, if notice by Borrower is sent to the Authority within fifteen (15) days of knowledge of the commencement of the cause. Notwithstanding the foregoing, none of the foregoing e vents will constitute a Force Majeure Delay unless and until Borrower delivers to the Authority written notice describing the event, its cause, when and how Borrower obtained knowledge, the date and the event commenced, and the estimated delay resulting therefrom. Borrower will deliver such written notice within fifteen (15) days after it obtains actual knowledge of the event . Times of performance under this Note may also be extended in writing by the Authority and Borrower , such revision approval may be denied by either party in its sole discretion.

19. If the rights created by this Note are held by a court of competent jurisdiction to be invalid or unenforceable as to any part of the obligations described herein, the remaining obligations must be completely performed and paid.

20. The Authority Deed of Trust securing this Note and all other LMIHAF Loan Documents, except the Agreement Containing Covenants, have been made subordinate and junior to the claims, liens or charges of the Construction Loan Deed of Trust and all other instruments securing the Construction Loan by that certain Subordination Agreement by and among Authority, Borrower and Construction Lender which is being recorded concurrently with the execution and delivery of this Note and the recordation of the Authority Deed of Trust and will also be subordinate and junior to the claims, liens or charges of the Permanent Loan Deed of Trust and all other instruments securing the Permanent Loan.

21. The Authority agrees that the lien of the Authority Deed of Tr ust will be subordinate to the extended low-income housing commitment (as such term is defined in Section 42(h)(6)(B) of the Internal Revenue Code) (the “Extended Use Agreement”) recorded against the Project; provided that such Extended Use Agreement, by its terms, must terminate upon foreclosure under the Authority Deed of Trust or upon a transfer of the Project by instrument in lieu of foreclosure or comparable conversion of the Loan, in accordance with Section 42(h)(6)(E) of the Internal Revenue Code. The following rule contained in Section 42(h)(6)(E)(ii) of the Internal Revenue Code of 1986, as amended, will also apply: for a period of three (3) years from the date of foreclo sure, with respect to any unit that had been regulated by the Extended Use Agreement, (i) none of the tenants occupying those units at the time of foreclosure may be evicted or their tenancy terminated (other than for good cause), (ii) nor may any rent be increased except as otherwise permitted under Section 42 of the Code. Borrower acknowledges and agrees that a default, event of default, or breach (however such terms may be defined) under the Extended 207 of 422
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Use Agreement will be an event of default under this Note and the Authority Deed of Trust and that all costs, damages or other amounts, including reasonable attorneys ’ fees incurred by the Authority as a result of an event of default by Borrower, and all amounts paid by Authority to cure a default under the Extended Use Agreement will be an obligation of Borrower and become a part of the debt evidenced by this Note and secured by the Authority Deed of Trust.

22. With regard to an approval, consent , or other determination by the Authority required under this Note or the other LMIHAF Loan Documents, the Authority will act reasonably and in good faith.

23. Borrower will have the right to prepay the obligation evidenced by this Note, or any part thereof, without penalty. However, prepayment of the obligation evidenced by this Note prior to the expiration of the term of the Agreement Containing Covenants will not entitle Borrower to a reconveyance of the Authority Deed of Trust.

24. This Note may be executed by each signatory on a separate signature page, and when the executed signature pages are combined, shall constitute one single instrument.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF Borrower has executed this Note as of the day and year first set forth above.

BORROWER

900 E BROADWAY, L.P.,
a California limited partnership

by: 900 E Broadway, LLC,
a California limited liability company,
its Administrative General Partner

by: Meta Development, LLC,
a California limited liability company,
its Administrative General Partner

By:___________________________
Kasey Burke
Manager

by: WCH Affordable LXIII, LLC,
a California limited liability company,
its Managing General Partner

By:___________________________
Graham Espley-Jones
President

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PROMISSORY NOTE

TO THE HOUSING AUTHORITY

OF THE CITY OF GLENDALE
(MEASURE S FUNDS)
3% Int
erest Glendale, California
$11,525,000 __________ , 202_

FOR VALUE
RECEIVED, 900 E BROADWAY, L.P., a California limited partnership (“Borrower”), hereby promises to pay to the HOUSING AUTHORITY OF THE CITY OF GLENDALE (“Authority”), a public body, corporate and politic, or order, a principal amount of Eleven Million Five Hundred Twenty-Five Thousand Dollars and 0/100 ($11,525,000.00), being the principal amount of the Authority’s loan of Measure S combined acquisition and construction to permanent funds (the “Measure S Loan”). This Note is given pursuant to that certain Affordable Housing Agreement dated as of ________________, 2021, between Borrower and the Authority (the “Affordable Housing Agreement”) and evidences the Measure S Loan to Borrower, which provides part of the financing for the acquisition and development of that certain real property located at 900 East Broadway in the City of Glendale, legally described in the Deed of Trust securing this Note (the “Property”). The obligation of Borrower to Authority hereunder is subject to the terms of the Affordable Housing Agreement, this Note and the following instruments, each dated on or about the date hereof, and, where applicable, executed and delivered by Borrower for the purpose of securing this Note: an Agreement Containing Covenants (Including Rental Restrictions) (“Agreement Containing Covenants ”); a Subordinate d Leasehold Deed of Trust, Security Agreement and Fixture Filing (With Assignment of Rents) (“Authority Deed of Trust”); an Assignment of Rents and Leases ( “Assignment of Rents ”); an Assignment of Agreeme nts (“Assignment of Agreements”); and a UCC-1 Financing Statement. Said documents are public records on file in the offices of Authority , and the provisions of said documents are incorporated herein by this reference. The Borrower will pay interest at the rate, in the amount and at the time hereinafter provided.

1. C apitalize
d terms not otherwise defined herein will have the meaning ascribed to such term s in the Affordable Housing Agreement. In addition, the following terms have the following meanings:
“Acquisition and Development Costs” means the total cost of acquiring the Property and developing and constructing the Improvements thereon in accordance with the Affordable Housing Agreement.
“Affiliat
e” means any Person directly or indirectly controlling, controlled by or under common control with another Person. The term “control” as used in the immediately preceding sentence, means the power to direct the management or the power to control election of the board of directors. It will be a presumption that control with respect to a corporation or limited liability company is the right to exercise or control, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with Attachment No. 13
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respect to any individual, partnership, trust, other entity or association, control is the possession, indirectly or directly, of the power to direct or cause the direction of the management or policies of the controlled entity. For purposes of this definition, each general partner will be considered an “Affiliate” of Borrower.

“ Annual Financial Statement” means the annual audited financial statement of Revenue and Operating Expenses and balance sheet for the Improvements, prepared at the Borrower’s expense, by an independent certified public accountant reasonably acceptable to the Authority, which will form the basis for determining the Residual Receipts.

“ Authority Deed of Trust ” means the Subordinated Leasehold Deed of Trust, Security Agreement and Fixture Filing (with Assignment of Rents) executed by Borrower in favor of Authority and dated on or about the date hereof, which secures this Note and the Measure S Loan evidenced hereby.

“Authority’s Share of Residual Receipts” will have the meaning set forth in Section 8, below.

“Construction Financing Event” means the point in time when all conditions precedent to the release of the Construction Loan funds and the Authority Loan funds have been satisfied, in accordance with the Affordable Housing Agreement.

Construction Loan” means the Construction Period loan to be made to Owner by Bank of America, NA, in its capacity as Servicer o f the Construction Period loan (together with its successors and assigns, “Construction Lender”) at the time of the Construction Financing Event, secured by the Construction Loan Deed of Trust.

“ Construction Loan Deed of Trust ” means the deed of trust securing the Construction Loan that is first in priority.

“ Construction Period ” means the period of time commencing upon the Construction Financing Event and ending upon the repayment of the Construction Loan and the funding of the Permanent Loan.

“ Conversion” means the point in time when the Permanent Loan has been funded, the additional Limited Partner Capital Contribution has been funded (less that portion, not to exceed 10%, of the Limited Partner Capital Contribution that will be funded upon receipt of Form(s) 8609), and the Construction Loan has been repaid in full.

“Deferred Developer Fee” means that portion of the Developer Fee which was not paid prior to the date of Conversion and which will be paid from the Revenue remaining after payment of Operating Expenses, prior to any payment of Residual Receipts to the Authority. The term “Deferred Developer Fee” will include any loan or capital contribution made by a partner of Borrower to pay such deferred fee.

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“Developer Equity” means funds provided by the Borrower for payment of Acquisition and Development Costs and will not include the Senior Loan, the LMIHAF Loan, the Measure S Loan, the HOME Loan, or any other borrowed funds, and will include the Deferred Developer Fee, the Investor Limited Partner’s capital contribution, as well as any other funds of the Borrower.

“Developer Fee” means the fee in the amount set forth in the Project Budget.

“Environmental Indemnity” means the indemnity in the form attached to the Affordable Housing Agreement as Attachment No. 18, which is incorporated herein by this reference.

“ HOME Loan” means the loan from the Authority to Borrower pursuant to the Affordable Housing Agreement as amended from time to time, in the amount of $1,800,000, which is evidenced by the HOME Loan Note and secured by the lien of the Authority Deed of Trust that is second in priority to the lien of the Senior Loan Deed of Trust.

“HOME Note” means the Promissory Note dated as of the date hereof, evidencing the HOME Loan.

“Improvements” means the 127-unit residential development and ancillary facilities to be constructed on the Property, all as described in the Affordable Housing Agreement.

“ Investor Limited Partner” means Bank of America, N.A., a national banking association, and Banc of America CDC Special Holding Company, Inc. a North Carolina corporation and each of its authorized successors and assigns.

“LMIHAF Loan” means the loan made by the Authority to Borrower in the maximum amount of $1,725,000, which is evidenced by the LMIHAF Note and secured by the Authority Deed of Trust.

“ LMIHAF Note” means the Promissory Note dated as of the date hereof, evidencing the LMIHAF Loan.

“ Low Income Housing Tax Credits” means tax credits authorized by the Tax Reform Act of 1986 and governed by Section 42 of the Internal Revenue Code.

“Measure S Loan” means the loan made by the Authority to Borrower in the maximum amount of $11,525,000, which is evidenced by this Note and secured by the Authority Deed of Trust.

“Measure S Loan Documents ” means this Note, the Authority Deed of Trust, the Agreement Containing Covenants, the Assignment of Rents, the Assignment of Agreements, the Environmental Indemnity, and the UCC -1 Financing Statement, each dated on or about the date hereof.

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“Measure S Note” means this Note dated as of the date hereof, evidencing the Measure S Loan.

“Net Proceeds” means the proceeds of a sale, transfer or refinancing, less the customary and reasonable costs of the transaction.

“Operating Expenses” means actual, reasonable and customary costs, fees and expenses directly attributable to the operation, maintenance and management of the Property that are consistent with an annual independent audit performed by a certified public accountant using generally accepted accounting principles, expressly including, without limitation, payment of the following:

a. Principal and interest and all periodic fees and costs due and payable on the Senior Loan;
b. Property and other taxes and assessments imposed on the Project; c. A general partner partnership management fee to the general partners of Borrower not to exceed $7,500 per year, to be increased at an annual rate of three percent (3%), which will accrue to the extent not paid;
d. General administrative expenses including but not limited to advertising and marketing, security services and systems and similar customary administrative expenses;
e. Maintenance and repair including but not limited to pest control, landscaping and grounds maintenance, painting and decorating, cleaning, common systems repairs, general repairs, janitorial, supplies, and similar customary services; f. Cash deposited into a replacement reserve fund in the amount of $250 per unit per year, to be increased at an annual rate of three percent (3%); g. Cash deposited into an operating reserve fund in such reasonable amounts as are required by Project lenders, the California Tax Credit Allocation Committee, and the Investor Limited Partner from time to time, and approved by the Authority; h. Utility services not paid for directly or reimbursed by tenants, including but not limited to water, sewer, trash collection, gas and electricity; i. License or certificate of occupancy fees required for operation of the Project; j. Premiums for property damage and liability insurance; k. Cable television, satellite and similar services;
l. Recreational amenities, supplies and services;
m. Reasonable property management fee payable to a third party property manager acceptable to the Authority in an annual amount equal to [$____] per unit, to be increased at an annual rate of [______________] percent (___%), and pursuant to a management contract approved by the Authority;
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n. A reasonable resident services coordinator fee payable to a coordinator acceptable to the Authority;
o. Purchase, repair, servicing and installation of appliances, equipment, fixtures and furnishings (other than from reserves);
p. Fees and expenses of accountants, attorneys, consultants and other professionals, including annual audits and tax return preparation costs payable to a third party; and
q. An Asset Management Fee to Borrower’s Limited Partner in an amount not to exceed $7,500 per year, to be increased at an annual rate of three percent (3%); and r. A Project monitoring fee to the Authority in an amount equal to $18,900 per year.

Operating Expenses will not include the following: depreciation, amortization, depletion or other non-cash expenses, any amount expended from a reserve account, or the repayment under Borrower’s partnership agreement of operating expense loans or development deficit loans.

Operating Expenses will be subject to the reasonable approval of the Authority.

“ Permanent Loan” means the initial permanent loan to be made to Borrower by Citibank, NA (together with its successors and assigns, “ Permanent Lender”) at Conversion, secured by the Permanent Loan Deed of Trust.

“ Permanent Loan Deed of Trust ” means the leasehold deed of trust securing the Permanent Loan that is first in priority.

“ Permanent Period” means the period of time commencing upon the repayment of the Construction Loan and the funding of the Permanent Loan and payment of the Limited Partner Capital Contribution.

“ Permitted Transfer” means any of the following , provided (except for subsection f. below) Borrower, a general partner of Borrower, or an Affiliate of such general partner, retains day-to-day control over management and operations of the Property and the Improvements and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti - Terrorism Laws:
a. An assignment of the Affordable Housing Agreement and Borrower’s interests in the Property to an Affiliate or a conveyance back from the Affiliate to Borrower; b. A conveyance of a security interest in the Property or any portion thereof or interest therein, in connection with a Senior Loan;
c. The inclusion of equity participation in the Project by addition of limited partners to Borrower’s partnership or similar mechanism, and transfers of limited partnership interests in Borrower’s partnership;
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d. The lease for occupancy of all or any part of the Improvements on the Property in accordance with the Affordable Housing Agreement;
e. The granting of easements or permits to facilitate the development of the Property in accordance with the Affordable Housing Agreement;
f. The withdrawal, removal and/or replacement of a general partner of Borrower’s partnership pursuant to the terms of Borrower’s partnership agreement, or a conveyance of Borrower’s interest in the Property and the Improvements and/or a transfer of limited partnership interests to a general partner or an affiliate of Meta Development LLC pursuant to the option provided to that partner in Borrower’s partnership agreement, will not constitute a default under this Agreement or any of the Measure S Loan Documents, nor will s uch actions accelerate the maturity of the Measure S Loan, provided that any required substitute general partner is reasonably acceptable to the Authority, as evidenced by the Authority’s written consent, and is selected with reasonable promptness; and g. A transfer approved in writing by Authority’s Executive Director or designee, at his or her sole discretion.

A transfer described in clauses a., b. or c. will be subject to the reasonable approval of the Authority Executive Director or designee; provided tha t, the Authority approves the transfer of limited partner interests in Borrower’s partnership, so long as such transfer is not a result of a resyndication of the Low Income Housing Tax Credits and does not otherwise result in increased equity participation in Borrower, and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti-Terrorism Laws.

“ Person” means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, domestic or foreign.

“ Property” means the real property described as the “Property” in and legally described as set forth in Exhibit “A” of the Authority Deed of Trust.

“ Residual Receipts” means the Revenue minus the Operating Expenses, calculated on a 12-month basis, minus the theretofore unpaid portion of the Deferred Developers Fee. All calculations of Residual Receipts will be subject to verification and reasonable approval by the Authority.

“ Revenue” means the gross rental income from the Improvements, and any other income to the Borrower derived from the ownership, operation and management of the Property, including but not limited to the following: all rents, fees and charges paid by tenants, Section 8 payments or other rental subsidy payments received for the dwelling units, deposits forfeited by tenants, all cancellation fees, price index adjustments and any other rental adjustments to leases or rental agreements; proceeds from vending and laundry room machines; the proceeds of business interruption or similar insurance; the proceeds of casualty insurance to the extent not utilized to repair or rebuild the Project; and condemnation awards for a taking of part or all of the Project for 215 of 422
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a temporary period. “Revenue” will also include the fair market value of any goods or services provided in consideration for the leasing or other use of any portion of the Project, except that the value of services provided by on-site manager(s) will not be treated as “Revenue” if no more than one dwelling unit is leased to or otherwise used by on-site manager(s). “Revenue” will not include tenants’ security deposits, proceeds from the Senior Loan, the Authority Loan, Developer Equity, including capital contributions or similar advances, or interest that is earned on and allocated to reserve accounts.

“ Senior Loan” means the Construction Period loan made by Construction Lender (in its capacity as Servicer of the Construction Period loan) to Borrower in the approximate amount of [$35,000,000] and the Permanent Loan to be made by Permanent Lender to Borrower to repay all or part of the Construction Loan in the approximate amount of [$17,700,000] which will be secured by a deed of trust that is senior and superior to the Authority Deed of Trust, or any other loan secured by a deed of trust or other instrument to which the Authority agrees, in its sole discretion, to subordinate this Note and the Authority Deed of Trust.

“ Term” of this Note means a term that expires on the fifty -fifth (55th) anniversary of the date of Conversion.

“ Transfer” will have the meaning set forth in Section 11.e of this Note.

2. This Note evidences the obligation of the Borrower to the Housing Authority for the repayment of the Measure S Loan. None of the funds provided pursuant to the Measure S Loan were funded directly or indirectly with any obligation the interest on which is exempt from tax under Section 103 of the Internal Revenue Code of 1986, as amended, or pursuant to any United States government federal source.

3. This Note is payable at the principal office of Authority, 141 North Glendale Avenue, Glendale, California 9 1206, or at such other place as the holder hereof may inform the Borrower in writing, in lawful money of the United States.

4. This Note is secured by the Authority Deed of Trust.

5. This Note will bear three percent (3%) simple interest.

6. Except in the event of a default described in Section 7 hereof, no payments will be due and payable under this Note except to the extent of (a) the Authority’s share of Residual Receipts as described in Section 8, below, and (b) any refinancing, Cost Savings or Additional Proceeds, subject to the limitations set forth in Section 10, below.

7. The entire unpaid principal balance of this Note and any accrued but unpaid interest will be due and payable upon the expiration of the Term hereof, or immediately upon the occurrence of either of the following:
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a. if the Property or any portion thereof or interest therein is sold, transferred, assigned or refinanced, without the prior written approval of the Authority , except as otherwise permitted in this Note; or
b. if there is a default by the Borro wer under the terms of this Note, the Authority Deed of Trust, the A ffordable Housing Agreement , the Agreement Containing Covenants, or any deed of trust or other instrument securing the Senior Loan or other obligations secured by a deed of trust on the Property, which is not cured within the respective time period provided herein and therein.

8. Prior to the expiration of the Term hereof, Borrower will be obligated to repay the Measure S Loan exclusively from the Authority’s share of Residual Receipts, as follows:
a. Annually, not later than the thirtieth (30th) day of April, beginning with the year following the year in which Conversion occurs, Borrower will submit to Authority an audited Annual Financial Statement for the preceding calendar year, prepared by a certified public accountant reasonably acceptable to the Authority, determining the amount of Residual Receipts, if any, generated in that year, together with payment of the Authority’s Share of such Residual Receipts. The first such Annual Financial St atement will be for the partial year beginning on the date of Conversion and ending on December 31 of that year. The Authority will review and approve such Annual Financial Statement, or request reasonable revisions, within 30 days after receipt. If as the result of the Authority’s review of the statement, there is an increase in the amount of any payment due and payable to Authority (as the result, for example, of a determination that the actual amount of Residual Receipts to which the Authority is entitled exceeds the amount of Authority’s share of Residual Receipts shown in the Annual Financial Statement submitted by Borrower), Borrower will promptly pay to the Authority the difference, with interest, from the date on which such payment was due, at the ra te of one percent (1%) over the Prime Rate announced by Bank of America, but in any event within ten (10) days of notice of such increase. b. The Authority’s Share of Residual Receipts to be applied to this Note, the LMIHAF Note, and the HOME Note will be 50%. The Authority’s Share of Residual Receipts will be applied to the HOME Note, the LMIHAF Note, and the Measure S Note as follows: 11.96% (i.e., $1,800,000/$15,050,000) will be applied to the HOME Note, 11.46% (i.e., $1,725,000/$15,050,000) will be applied to th e LMIHAF Note, and 76.58% (i.e., $11,525,000/$15,050,000) will be applied to this Note.

9. All payments applie d to this Note will be applied first to penalties and late fees, then to interest, then to reduce the principal amount owed.

10. The Measure S Loan evidenced by this Note is based on the assumption that, upon completion and stabilization, all Acquisition and Development Costs will be $59,761,000 and the maximum amount of the Permanent Loan to be secured by a first priority deed of tr ust will be $___________. To induce Authority to make the Measure S Loan evidenced hereby, Borrower covenants and agrees as follows:
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a. If Borrower obtains a Permanent Loan in a principal amount in excess of $[16,950,000], Borrower will apply an amount equal to fifty percent (50%) of the proceeds thereof in excess of $[16,950,000] (the “Additional Proceeds ”) to pay accrued interest on, and then reduce the princip al amount of the LMIHAF Loan, the Measure S Loan, and the HOME Loan, except to the extent such Additional Proceeds are needed to either pay for cost overruns for which no other funds are available (other than from Borrower’s general partners) or to compensate for reductions in other permanent financing sources. If at any time Borrower refinances the Permanent Loan, Borrower will apply the Net Proceeds of any such refinancing first to pay previously incurred Operating Expenses (as defined above) still owing, then fifty percent (50%) of the balance will be paid to the Authority to pay accrued interest on, and then reduce the principal amount of the LMIHAF Loan, the Measure S Loan, and the HOME Loan. b. If, there are Cost Savings with respect to the Project, the following will occur: (1) to the extent of fifty percent (50%) of the Cost Savings, any undisbursed amount of the Authority Loan plus any undisbursed capital contributions made by Borrower’s Investor Limited Partner will be released to the Authority as a payment of accrued interest on and then reduction of the principal amount of the Authority Loans; and (2) each Lender’s unfunded commitment will terminate. For purposes hereof, “Cost Savings”, shall mean the difference between the total sources of funds and the total cost of development as shown in the Borrower’s cost certification contained in Borrower’s application to the California Tax Credit Allocation Committee for a Form 8609 for the Project (“Tax Credit Report”); provided, however, the Cost Savings will be adjusted to take into account (i) the loss of any equity investment due to an adjustment in the allowable tax credits; provided that the tax credit factor applied to the required equity contribution will be as set forth in Borrower’s limited partnership agreement; and (ii) any reduction in the first mortgage loan required by the Senior Loan Documents. The amount payable to Authority under this paragraph will be paid within sixty (60) days following submittal of the Tax Credit Report to the California Tax Credit Allocation Committee.

11. Prohibitions on Transfer.
a. Prior to the repayment in full of the Measure S Loan and expiration of the Term of the Agreement Containing Covenants , the Borrower must not , except for Permitted Transfers or as permitted by the Affordable Housing Agreement, assign or attempt to assign the Affordable Housing Agreement or this Note or any right therein or herein, nor make any total or partial sale, transfer, conveyance or assignment of the whole or any part of the Property (referred to hereinafter as a “Transfer”), without prior written approval of the Authority, except as expressly permitted by the Affordable Housing Agreement or this Note. Consent to one such transaction will not be deemed to be a waiver of the right to require consent to future or successive transactions. Authority shall not unreasonably withhold or delay its consent. If consent should be given, any such transfer shall be subject to this Section 11, and any such transferee shall assume all obligations hereunder and agree to be bound by all provisions contained herein. b. Proposed transferees (other than an Affiliate of Borrower) must have the qualifications and financial responsibility necessary and adequate as may be reasonably determined by the Authority, to fulfill Borrower’s obligations undertaken in the Affordable 218 of 422
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Housing Agreement, the Agreement Containing Covenants, and this Note. A proposed transferee (including an Affiliate of Borrower), by instrument in writing satisfactory to the Authority and in form recordable among the land records, for itself and its successors and assigns, and for the benefit of the Authority must expressly assume all of Borrower’s obligations under the Affordable Housing Agreement, the Agreement Containing Covenants, and this Note and agree to be subject to all conditions and restrictions applicable to Borrower. There must be submitted to the Authority for review all instruments and other legal documents proposed to affect any such transfer; and if approved by the Authority its approval will be indicated to Borrower in writing. If consent should be given, such transfer will be subject to this Section 11. c. In the absence of specific written agreement by the Authority , no unauthorized Transfer, or approval thereof by the Authority , will be deemed to relieve the Borrower or any other party from any obligations under the A ffordable Housing Agreement, the Agreement Containing Covenants, or this Note.
d. In the event of a Transfer prior to the time the Measure S Loan is paid in full without
the prior written consent of the Authority , the remaining principal balance of the Measure S Loan and all accrued but unpaid interest will be immediately due and payable. e. As used herein, “Transfer” means
i. the sale, agreement to sell, transfer or conveyance of the Property, the Project, or any portion thereof or interest therein (including, without limitation, a beneficial interest), whether voluntary, involuntary, by operation of law or otherwise, the execution of any installment sale contract or similar instrument affecting all or a portion of the Property or Project, or the lease of all or substantially all of the Property or Project. ii. “Transfer” also includes the transfer, assignment, hypothecation or conveyance of legal or beneficial ownership of an interest in Borrower, or a conversion of Borrower to an entity form other than that of Borrower at the time of execution of the Affordable Housing Agreement, except that, a cumulative change in ownership inter est of a general partner of Borrower of forty-nine percent (49%) or less will not be deemed a “Transfer” for purposes of this Note.

12. The Authority will not unreasonably withhold, condition, or delay its approval of any matter for which its appr oval is required hereunder. The Authority’s disapproval will be in writing and contain the Authority’s reasons for disapproval.

13. The Measure S Loan is funded from the Authority’s Measure S funds. Accordingly, Borrower agrees for itself, its successors and assigns that the use of the property will be subject to the restrictions on rent and occupancy set forth in the Agreement Containing Covenants.

14. Subject to the provisions and limitations of this Section 14, the obligation to repay the Measure S Loan is a nonrecourse obligation of the Borrower. Borrower and each general partner or limited partner of Borrower will not have any personal liability for repayment of the loan, except as provided in this Section 14. The sole recourse of Authority will be the exercise of 219 of 422
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its rights against the Property and other security for the Measure S Loan. Provided, however, that the foregoing will not (a) constitute a waiver of an obligation evidenced by this Note or the Authority Deed of Trust; (b) limit the right of the Authority to name Borrower as a party defendant in any action or suit for judicial foreclosure and sale under this Note and the Authority Deed of Trust or any action or proceeding hereunder so long as no judgment in the nature of a deficiency judgment will be asked for or taken against Borrower; (c) release or impair this Note or the Authority Deed of Trust; (d) prevent or in any way hinder the Authority from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, any other remedy against the mortgaged Property or other instrument securing the Note or as prescribed by law or in equity in case of default; (e) prevent or in any way hinder the Authority from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, its remedies in respect of deposits, insurance proceeds, condemnation awards or other monies or other collateral or letters of credit securing this Note; (f) relieve Borrower of its obligations under an indemnity delivered by Borrower to Authority; or (g) affect in any way the validity of a guarantee or indemnity from any person of all or any of the obligations evidenced and secured by this Note and the Authority Deed of Trust. The foregoing provisions of this paragraph are limited by the provision that in the event of the occurrence of a default, Borrower and its successors and assigns will have personal liability hereunder for any deficiency judgment, but only if and to the extent Borrower, its principals, shareholders, partners or its successors and assigns received rentals, other revenues, or other payments or proceeds in respect of the mortgaged Property after the occurrence of such default, which rentals, other revenues, or other payments or proceeds have not been used for the payment of ordinary and reasonable operating expenses of the mortgaged Property, ordinary and reasonable capital improvements to the mortgaged Property, debt service, real estate taxes in respect of the mortgaged Property and basic management fees, but not incentive fees, payable to an entity or person unaffiliated with Borrower in connection with the operation of the mortgaged Property, which are then due and payable. Notwithstanding the first sentence of this paragraph, Authority may recover directly from Borrower or from any other party (other than Borrower’s Investor Limited Partner):
a. damages, costs and expenses incurred by the Authority as a result of fraud or criminal act or acts of Borrower or a partner, shareholder, officer, director or employee of Borrower, or of a member or general or limite d partner of Borrower, or of a general or limited partner of such member or general or limited partner;
b. damages, costs and expenses incurred by Authority as a result of misappropriation of funds provided for the payment of Acquisition and Development Costs , as described in the A ffordable Housing Agreement, rents and revenues from the operation of the Project, or proceeds of insurance policies or condemnation proceeds; c. all amounts owing by Borrower pursuant to the indemnification regarding Hazardous Substances under the Environmental Indemnity, and d. all court costs and attorneys ’ fees reasonably incurred in enforcing or collecting upon any of the foregoing exceptions (provided that Authority will pay Borrower ’s 220 of 422
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reasonable court costs and attorneys’ fees if Borrower is the prevailing party in such enforcement or collection action).

15. Borrower waives presentment for payment, demand, protest, and notices of dishonor and of protest; the benefits of all waivable exemptions; and all defenses and pleas on the ground of an extension or extensions of the time of payment or of a due date under this Note, in whole or in part, whether before or after maturity and with or without notice. Borrower hereby agrees to pay all costs and expenses, including reasonable attorney’s fees, which may be incurred by the holder hereof, in the enforcement of this Note, the Authority Deed of Trust or any term or provision of either thereof.

16. Upon the failure of Borrower to perform or observe a term or provision of this Note, or upon the occurrence of an event of default under the terms of the Authority Deed of Trust, the Affordable Housing Agreement, the Agreement Containing Covenants, or a deed of trust securing a Senior Loan, or other obligations secured by a deed of trust on the Property, and after expiration of the applicable cure period, the holder may exercise its rights or remedies hereunder or thereunder.

17. Defaults and Remedies.
a. Subject to the extensions of time set forth in Section 18, and subject to the further provisions of this Secti on 17, failure or delay by Borrower to perform a material term or provision of this Note, the Authority Deed of Trust, the A ffordable Housing Agreement, the Agreement Containing Covenants, or a deed of trust securing a Senior Loan, or other obligations secured by a deed of trust on the Property, constitutes a default under this Note. b. The Authority will give written notice of default to Borrower, specifying the default complained of by the Authority. Delay in giving such notice will not constitute a waiver of any default nor will it change the time of default.
c. Failures or delays by the Authority in asserting its rights and remedies as to a default will not operate as a waiver of default or of such rights or remedies. Delays by the Authority in asserting its rights and remedies will not deprive the Authority of its right to institute and maintain actions or proceedings which it may deem necessary to protect, assert, or enforce such rights or remedies.
d. If a monetary event of default o ccurs under the terms of this Note or the Authority Deed of Trust, or a deed of trust securing a Senior Loan, or other obligations secured by a deed of trust on the Property, prior to exercising its remedies hereunder or thereunder the Authority will give Borrower, each general partner, and the Investor Limited Partner, concurrent written notice of such default. Borrower will have a reasonable period of time after such notice is given within which to cure the default prior to exercise of remedies by the Authority under this Note and the Authority Deed of Trust. In no event will the Authority be precluded from exercising remedies if its security becomes or is about to become materially impa ired by a failure to cure a default or the default is not cured within ten (10) calendar days after the notice of default is received or deemed received.
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e. If a non-monetary event of default occurs under the terms of the Affordable Housing Agreement, this Note, the Authority Deed of Trust, the Agreement Containing Covenants, or a document implementing the A ffordable Housing Agreement or a deed of trust securing a Senior Loan or other obligations secured by a deed of trust on the Property, prior to exercising its remedies hereunder or thereunder, the Authority will give Borrower, each general partner, and the Investor Limited Partner, concurrent notice of such default. If the default is reasonably capable of being cured within thirty (30) calendar days after such notice is received or deemed received, Borrower will have such period to effect a cure prior to exercise of remedies by the Authority under the Affordable Housing Agreement, the Agreement Containing Covenants, this Note and/or the Authority Deed of Trust. If the default is such that it is not reasonably capable of being cured within thirty (30) days, and Borrower (i) initiates corrective action within said period, and (ii) diligently and in good faith works to effect a cure as soon as possible, then Borrower will have such additional time as is reasonably necessary to cure the default prior to the Authority’s exercise of remedies. If Borrower fails to take corrective action or to cure the default within the time set forth above in this Subse ction 17.e, the Authority will give Borrower , the Senior Lender, the Investor Limited Partner written notice thereof, whereupon the Investor Limited Partner, subject to the terms of Borrower’ s partnership agreement, may take such corrective action, including removing and replacing a general partner. The Investor Limited Partner will have 45 days, or such longer period as is approved by the Authority Executive Director or designee, to remove and replace such general partner of Borrower. The Authority agrees to accept cures tendered by a Senior Lender or the Investor Limited Partner within the time period provided herein. Additionally, in the event the Senior Lender , or Investor Limited Partner is precluded from curing a non - monetary default due to a bankruptcy, injunction, or similar proceeding by or against Borrower or a general partner , the Authority agrees to forbear from completing a foreclosure (judicial or nonjudicial) during the period during which such party is so precluded from acting, not to exceed 90 days or such additional time as is reasonably approved by the Authority Executive Director or designee, provided such Senior Lender or Investor Limited Partner is otherwise in compliance with the foregoing provisions. In no event will Authority be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by a failure to cure a default or the default is not cured within one hundred eighty (180) days after the notice of default is received or deemed received or such additional time as is reasonably approved by the Authority Executive Director or designee.
f. A notice of default that is transmitted by electronic facsimile transmission followed by delivery of a “hard” copy, will be deemed delivered upon its transmission; a notice of default that is personally delivered (including by means of professional messenger service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal Service), will be deemed received on the documented date of receipt by Borrower; and a notice of default that is sent by registered or certified mail, postage prepaid, return receipt required will be deemed received on the date of receipt thereof. Notices to the limited partner will be sent to the following address:

To Authority: HOUSING AUTHORITY OF

THE CITY OF GLENDALE
141 N. Glendale Avenue, Room 202,
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Glendale, California 91206
Attention: Executive Director
Facsimile: 818-548-3724

With a copy to: KANE, BALLMER & BERKMAN
515 S. Figueroa St., Suite 780
Los Angeles, California 90071-3301
Attention: Susan Apy

To Borrower: 900 E BROADWAY, L.P.
c/o Meta Housing Corporation
1150 W. Olympic Blvd., Suite 620
Los Angeles, California 90064
Attention: President

With a copy to:

Bank of America, N.A.

MA1-225-02-02
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Facsimile: 617-346-2257

And:

Banc of America CDC Special Holding Company, Inc.

MA1-225-02-02
225 Franklin Street
Boston, MA 02110
Attention: Asset Management
Facsimile: 617-346-2257

And:

Buchalter, a Professional Corporation
1000 Wilshire Boulevard, Suite 1500
Los Angeles, CA 90017
Attn: Michael A. Williamson, Esq.

Facsimile: (213) 630-5799
Matter No: B0965-0629

18. Notwithstanding specific provisions of this Note, Borrower will not be deemed to be in default for failure to perform a non-monetary obligation hereunder where delays or defaults are due to war, insurrection, strikes, lock- outs, riots, floods, earthquakes, fires, casualties, acts of 223 of 422
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God, acts of the public enemy, epidemics, quarantine restrictions, freight embargoes, lack of transportation, governmental restrictions or priority, litigation, unusually severe weather, inability to secure necessary labor, material or tools, delays of any contractor, sub -contractor or supplier, acts of the Authority or any other public or governmental Authority or entity, or any causes beyond the control or without the fault of the Borrower. An extension of time for any such cause (a “Force Majeure Delay”) will be for the period of the enforced delay and will commence to run from the time of the commencement of the cause, if notice by Borrower is sent to the Authority within fifteen (15) days of knowledge of the commencement of the cause. Notwithstanding the foregoing, none of the foregoing events will constitute a Force Majeure Delay unless and until Borrower delivers to the Authority written notice describing the event, its cause, when and how Borrower obtained knowledge, the date and the event commenced, and the estimated delay resulting therefrom. Borrower will deliver such written notice within fifteen (15) days after it obtains actual knowledge of the event. Times of performance under this Note may also be extended in writing by the Authority and Borrower, such revision approval may be denied by either party in its sole discretion.

19. If the rights created by this Note are held by a court of competent jurisdiction to be invalid or unenforceable as to any part of the obligations described herein, the remaining obligations must be completely performed and paid.

20. The Authority Deed of Trust securing this Note and all other Measure S Loan Documents, except the Agreement Containing Covenants, have been made subordinate and junior to the claims, liens or charges of the Construction Loan Deed of Trust and all other instruments securing the Construction Loan by that certain Subordination Agreement by and among Authority, Borrower and Construction Lender which is being recorded concurrently with the execution and delivery of this Note and the recordation of the Authority Deed of Trust and will also be subordinate and junior to the claims, liens or charges of the Permanent Loan Deed of Trust and all other instruments securing the Permanent Loan.

21. The Authority agrees that the lien of the Authority Deed of Trust will be subordinate to the extended low-income housing commitment (as such term is defined in Section 42(h)(6)(B) of the Internal Revenue Code) (the “Extended Use Agreement”) recorded against the Project; provided that such Extended Use Agreement, by its terms, must terminate upon foreclosure under the Authority Deed of Trust or upon a transfer of the Project by instrument in lieu of foreclosure or comparable conversion of the Loan, in accordance with Section 42(h)(6)(E) of the Internal Revenue Code. The following rule contained in Section 42(h)(6)(E)(ii) of the Internal Revenue Code of 1986, as amended, will also apply: for a period of three (3) years from the date of foreclosure, with respect to any unit that had been regulated by the Extended Use Agreement, (i) none of the tenants occupying those units at the time of foreclosure may be evicted or their tenancy terminated (other than for good cause), (ii) nor may any rent be increased except as otherwise permitted under Section 42 of the Code. Borrower acknowledges and agrees that a default, event of default, or breach (however such terms may be defined) under the Extended Use Agreement will be an event of default under this Note and the Authority Deed of Trust and that all costs, damages or other amounts, including reasonable attorneys ’ fees incurred by the Authority as a result of an event of default by Borrower, and all amounts paid by Authority to cure 224 of 422
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a default under the Extended Use Agreement will be an obligation of Borrower and become a part of the debt evidenced by this Note and secured by the Authority Deed of Trust.

22. With regard to an approval, consent , or other determination by the Authority required under this Note or the other Measure S Loan Documents, the Authority will act reasonably and in good faith.

23. Borrower will have the right to prepay the obligation evidenced by this Note, or any part thereof, without penalty. However, prepayment of the obligation evidenced by this Note prior to the expiration of the term of the Agreement Containing Covenants will not entitle Borrower to a reconveyance of the Authority Deed of Trust.

24. This Note may be executed by each signatory on a separate signature page, and when the executed signature pages are combined, shall constitute one single instrument.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURES ON FOLLOWING PAGE]
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IN WITNESS WHEREOF Borrower has executed this Note as of the day and year first set forth above.

BORROWER

900 E BROADWAY, L.P.,
a California limited partnership

by: 900 E Broadway, LLC,
a California limited liability company,
its Administrative General Partner

by: Meta Development, LLC,
a California limited liability company,
its Administrative General Partner

By:___________________________
Kasey Burke
Manager

by: WCH Affordable LXIII, LLC,
a California limited liability company,
its Managing General Partner

By:___________________________
Graham Espley-Jones
President

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HOME Note

PROMISSORY NOTE

TO THE HOUSING AUTHORITY

OF THE CITY OF GLENDALE
(HOME PROGRAM FUNDS)
3% Int
erest Glendale, California
$1,800,000 __________ , 202_

FOR VALUE
RECEIVED, 900 E BROADWAY, L.P., a California limited partnership (“Borrower”), hereby promises to pay to the HOUSING AUTHORITY OF THE CITY OF GLENDALE (“Authority”), a public body, corporate and politic, or order, a principal amount of One Million Eight Hundred Thousand Dollars and 0/100 ($1,800,000), being the principal amount of the Authority’s loan of HOME Program construction to permanent funds (the “HOME Loan”).

This Note is given pursuant to that certain Affordable Housing Agreement dated as of ______________________, 2021, between Borrower and the Authority (the “ Affordable Housing Agreement”) and evidences the HOME Loan to Borrower, which provides part of the financing for the acquisition and development of that certain real property located at 900 East Broadway in the City of Glendale, legally described in the Deed of Trust securing this Note (the “Property”). The obligation of Borrower to Authority hereunder is subject to the terms of the Affordable Housing Agreement, this Note and the following instruments, each dated on or about the date hereof, and, where applicable, executed and delivered by Borrower for the purpose of securing this Note: an Agreement Containing HOME Program Requirements (“ HOME Regulatory Agreement ”); a Subordinate d Leasehold Deed of Trust, S ecurity Agreement and Fixture Filing (With Assignment of Rents) (“Authority Deed of Trust”); an Assignment of Rents and Leases ( “Assignment of Rents ”); an Assignment of Agreements ( “Assignment of Agreements”); and a UCC-1 Financing Statement. Said documents are public records on file in the offices of Authority , and the provisions of said documents are incorporated herein by this reference. The Borrower will pay interest at the rate, in the amount and at the time hereinafter provided.

1. C apitalize
d terms not otherwise defined herein will have the meaning ascribed to such term s in the Affordable Housing Agreement. In addition, the following terms have the following meanings:
“Acquisition and Development Costs” means the total cost of acquiring the Property and developing and constructing the Improvements thereon in accordance with the Affordable Housing Agreement.
“Affiliat
e” means any Person directly or indirectly controlling, controlled by or under common control with another Person. The term “control” as used in the immediately preceding sentence, means the power to direct the management or the power to control election of the board of directors. It will be a presumption that control with respect to a corporation or limited liability company is the right to exercise or control, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with Attachment No. 14
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respect to any individual, partnership, trust, other entity or association, control is the possession, indirectly or directly, of the power to direct or cause the direction of the management or policies of the controlled entity. For purposes of this definition, each general partner will be considered an “Affiliate” of Borrower.

“ Annual Financial Statement” means the annual audited financial statement of Revenue and Operating Expenses and balance sheet for the Improvements, prepared at the Borrower’s expense, by an independent certified public accountant reasonably acceptable to the Authority, which will form the basis for determining the Residual Receipts.

“ Authority Deed of Trust ” means the Subordinated Leasehold Deed of Trust, Security Agreement and Fixture Filing (with Assignment of Rents) executed by Borrower in favor of Authority and dated on or about the date hereof, which secures this Note and the HOME Loan evidenced hereby.

“Authority’s Share of Residual Receipts” will have the meaning set forth in Section 8, below.

“Construction Financing Event” means the point in time when all conditions precedent to the release of the Construction Loan funds and the Authority Loan funds have been satisfied, in accordance with the Affordable Housing Agreement.

“ Construction Loan” means the Construction Period loan to be made to Owner by Bank of America, NA, in its capacity as Servicer of the Construction Period loan ( together with its successors and assigns, “Construction Lender”) at the time of the Construction Financing Event, secured by the Construction Loan Deed of Trust.

“ Construction Loan Deed of Trust ” means the deed of trust securing the Construction Loan that is first in priority.

“ Construction P eriod” means the period of time commencing upon the Construction Financing Event and ending upon the repayment of the Construction Loan and the funding of the Permanent Loan.

“ Conversion” means the point in time when the Permanent Loan has been funded, t he additional Limited Partner Capital Contribution has been funded (less that portion, not to exceed 10%, of the Limited Partner Capital Contribution that will be funded upon receipt of Form(s) 8609), and the Construction Loan has been repaid in full.

“Deferred Developer Fee” means that portion of the Developer Fee which was not paid prior to the date of Conversion and which will be paid from the Revenue remaining after payment of Operating Expenses, prior to any payment of Residual Receipts to the Authority. The term “Deferred Developer Fee” will include any loan or capital contribution made by a partner of Borrower to pay such deferred fee.

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“Developer Equity” means funds provided by the Borrower for payment of Acquisition and Development Costs and will not include the Senior Loan, the LMIHAF Loan, the Measure S Loan, the HOME Loan, or any other borrowed funds, and will include the Deferred Developer Fee, the Investor Limited Partner’s capital contribution, as well as any other funds of the Borrower.

“Developer Fee” means the fee in the amount set forth in the Project Budget.

“Environmental Indemnity” means the indemnity in the form attached to the Affordable Housing Agreement as Attachment No. 18, which is incorporated herein by this reference.

“ HOME Loan” means the loan from the Authority to Borrower pursuant to the Affordable Housing Agreement as amended from time to time, in the amount of $1,80,000, which is evidenced by this Note and secured by the lien of the Authority Deed of Trust that is second in priority to the lien of the Senior Loan Deed of Trust.

“HOME Loan Documents” means this Note, the Authority Deed of Trust, the HOME Regulatory Agreement, the Assignment of Rents, the Assignment of Agreements, the Environmental Indemnity, and the UCC-1 Financing Statement, each dated on or about the date hereof.

“HOME Note” means this Note dated as of the date hereof, evidencing the HOME Loan.

“Improvements” means the 127-unit residential development and ancillary facilities to be constructed on the Property, all as described in the Affordable Housing Agreement.

“ Investor Limited Partner means Bank of America, N.A., a national banking association, and Banc of America CDC Special Holding Company, Inc. a North Carolina corporation and each of its authorized successors and assigns.

“LMIHAF Loan” means the loan made by the Authority to Borrower in the maximum amount of $1,725,000, which is evidenced by the LMIHAF Note and secured by the Authority Deed of Trust.

“ LMIHAF Note” means the Promissory Note dated as of the date hereof , evidencing the LMIHAF Loan.

“ Low Income Housing Tax Credits” means tax credits authorized by the Tax Reform Act of 1986 and governed by Section 42 of the Internal Revenue Code.

“Measure S Loan” means the loan made by the Authority to Borrower in the maximum amount of $11,525,000, which is evidenced by the Measure S Note and secured by the Authority Deed of Trust.

“Measure S Note” means the Promissory Note dated as of the date hereof, evidencing the Measure S Loan.
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“Net Proceeds” means the proceeds of a sale, transfer or refinancing, less the customary and reasonable costs of the transaction.

“Operating Expenses” means actual, reasonable and customary costs, fees and expenses directly attributa ble to the operation, maintenance and management of the Property that are consistent with an annual independent audit performed by a certified public accountant using generally accepted accounting principles, expressly including, without limitation, payment of the following:

a. Principal and interest and all periodic fees and costs due and payable on the Senior Loan;
b. Property and other taxes and assessments imposed on the Project; c. A general partner partnership management fee to the general partners of Borrower not to exceed $ 7,500 per year, to be increased at an annual rate of three percent (3%), which will accrue to the extent not paid;
d. General administrative expenses including but not limited to advertising and marketing, security services and system s and similar customary administrative expenses;
e. Maintenance and repair including but not limited to pest control, landscaping and grounds maintenance, painting and decorating, cleaning, common systems repairs, general repairs, janitorial, supplies, and similar customary services; f. Cash deposited into a replacement reserve fund in the amount of $250 per unit per year, to be increased at an annual rate of three percent (3%); g. Cash deposited into an operating reserve fund in such reasonable amounts as are required by Project lenders, the California Tax Credit Allocation Committee, and the Investor Limited Partner from time to time, and approved by the Authority; h. Utility services not paid for directly or reimbursed by tenants, including but not limited to water, sewer, trash collection, gas and electricity; i. License or certificate of occupancy fees required for operation of the Project; j. Premiums for property damage and liability insurance; k. Cable television, satellite and similar services;
l. Recreational amenities, supplies and services;
m. Reasonable property management fee payable to a third party property manager acceptable to the Authority in an annual amount equal to [$____] per unit, to be increased at an annual rate of [______________] percent (___%), and pursuant to a management contract approved by the Authority;
n. A reasonable resident services coordinator fee payable to a coordinator acceptable to the Authority;
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o. Purchase, repair, servicing and installation of appliances, equipment, fixtures and furnishings (other than from reserves);
p. Fees and expenses of accountants, attorneys, consultants and other professionals, including annual audits and tax return preparation costs payable to a third party; and
q. An Asset Management Fee to Borrower’s Limited Part ner in an amount not to exceed $7,500 per year, to be increased at an annual rate of three percent (3%); and r. A Project monitoring fee to the Authority in an amount equal to $18,900 per year.

Operating Expenses will not include the following: depreciation, amortization, depletion or other non-cash expenses, any amount expended from a reserve account, or the repayment under Borrower’s partnership a greement of operating expense l oans or development deficit loans.

Operating Expenses will be subject to the reasonable approval of the Authority.

“ Permanent Loan” means the initial permanent loan to be made to Borrower by Citibank, NA (together with its successors and assigns, “ Permanent Lender”) at Conversion, secured by the Permanent Loan Deed of Trust.

“ Permanent Loan Deed of Trust ” means the leasehold deed of trust securing the Permanent Loan that is first in priority.

“ Permanent Period” means the period of time commencing upon the repayment of the Construction Loan and the funding of the Permanent Loan and payment of the Limited Partner Capital Contribution.

“ Permitted Transfer” means any of the following, provided (except for subsection f. below) Borrower, a general partner of Borrower, or an Affiliate of such general partner, retains day-to-day control over management and operations of the Property and the Improvements and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti - Terrorism Laws:
a. An assignment of the Affordable Housing Agreement and Borrower’s interests in the Property to an Affiliate or a conveyance back from the Affiliate to Borrower; b. A conveyance of a security interest in the Property or any portion thereof or interest therein, in connection with a Senior Loan;
c. The inclusion of equity participation in the Project by addition of limited partners to Borrower’s partnership or similar mechanism, and transfers of limited partnership interests in Borrower’s partnership;
d. The lease for occupancy of all or any part of the Improvements on the Property in accordance with the Affordable Housing Agreement;
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e. The granting of easements or permits to facilitate the development of the Property in accordance with the Affordable Housing Agreement;
f. The withdrawal, removal and/or replacement of a general partner of Borrower’s partnership pursuant to the terms of Borrower’s partnership agreement, or a conveyance of Borrower’s interest in the Property and the Improvements and/or a transfer of limited partnership interests to a general partner or an affiliate of Meta Development LLC pursuant to the option provided to that partner in Borrower’s partnership agreement, will not constitute a default under this Agreement or any of the HOME Loan Documents, nor will such actions accelerate the maturity of the HOME Loan, provided that any required substitute general partner is reasonably acceptable to the Authority, as evidenced by the Authority’s written consent, and is selected with reasonable promptness; and
g. A transfer approved in writing by Authority’s Executive Director or designee, at his or her sole discretion.

A transfer described in clauses a., b. or c. will be subject to the reasonable approval of the Authority Executive Director or designee; provided that, t he Authority approves the transfer of limited partner interests in Borrower’s partnership, so long as such transfer is not a result of a resyndication of the Low Income Housing Tax Credits and does not otherwise result in increased equity participation in Borrower, and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti-Terrorism Laws.

“ Person” means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, domestic or foreign.

“ Property” means the real property described as the “Property” in and legally described as set forth in Exhibit “A” of the Authority Deed of Trust.

“ Residual Receipts” means the Revenue minus the Operating Expenses, calculat ed on a 12-month basis, minus the theretofore unpaid portion of the Deferred Developers Fee. All calculations of Residual Receipts will be subject to verification and reasonable approval by the Authority.

“ Revenue” means the gross rental income from the Improvements, and any other income to the Borrower derived from the ownership, operation and management of the Property, including but not limited to the following: all rents, fees and charges paid by tenants, Section 8 payments or other rental subsidy payments received for the dwelling units, deposits forfeited by tenants, all cancellation fees, price index adjustments and any other rent al adjustments to leases or rental agreements; proceeds from vending and laundry room machines; the proceeds of business interruption or similar insurance; the proceeds of casualty insurance to the extent not utilized to repair or rebuild the Project; and condemnation awards for a taking of part or all of the Project for a temporary period. “Revenue” will also include the fair market value of any goods or services provided in consideration for the leasing or other use of any portion of the Project, except that the 232 of 422
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value of services provided by on-site manager(s) will not be treated as “Revenue” if no more than one dwelling unit is leased to or otherwise used by on-site manager(s). “Revenue” will not include tenants’ security deposits, proceeds from the Senior Loan, the Authority Loan, Developer Equity, including capital contributions or similar advances, or interest that is earned on and allocated to reserve accounts.

“ Senior Loan” means the Construction Period loan made by Construction Lender (in its capacity as Servicer of the Construction Period loan) to Borrower in the approximate amount of [$35,000,000] and the Permanent Loan to be made by Permanent Lender to Borrower to repay all or part of the Construction Loan in the approximate amount of [$17,700,000] which will be secured by a deed of trust that is senior and superior to the Authority Deed of Trust, or any other loan secured by a deed of trust or other instrument to which the Authority agrees, in its sole discretion, to subordinate this Note and the Authority Deed of Trust.

“ Term” of this Note means a term that expires on the fifty-fifth (55th) anniversary of the date of Conversion.

“ Transfer” will have the meaning set forth in Section 11.e of this Note.

2. This Note evidences the obligation of the Borrower to the Housing Authority for the repayment of the HOME Loan. None of the funds provided pursuant to the HOME Loan were funded directly or indirectly with any obligation the interest on which is exempt from tax under Section 103 of the Internal Revenue Code of 1986, as amended, or pursuant to any United St ates government federal source.

3. This Note is payable at the principal office of Authority, 141 North Glendale Avenue, Glendale, California 9 1206, or at such other place as the holder hereof may inform the Borrower in writing, in lawful money of the United States.

4. This Note is secured by the Authority Deed of Trust.

5. This Note will bear three percent (3%) simple interest.

6. Except in the event of a default described in Section 7 hereof, no payments will be due and payable under this Note except to the extent of (a) the Authority’s share of Residual Receipts as described in Section 8, below, and (b) any refinancing, Cost Savings or Additional Proceeds, subject to the limitations set forth in Section 10, below.

7. The entire unpaid principal balance of this Note and any accrued but unpaid interest will be due and payable upon the expiration of the Term hereof, or immediately upon the occurrence of either of the following:
a. if the Property or any portion thereof or interest therein is sold, transferred, assigned or refinanced, without the prior written approval of the Authority , except as otherwise permitted in this Note; or
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HOME Note

b. if there is a default by the Borrower under the terms of this Note, the Authority Deed of Trust, the Affordable Housing Agreement, the HOME Regulatory Agreement, or any deed of trust or other instrument securing the Senior Loan or other obligations secured by a deed of trust on the Property, which is not cured within the respective time period provided herein and therein.

8. Prior to the expiration of the Term hereof, Borrower will be obligated to repay the HOME Loan exclusively from the Authority’s share of Residual Receipts, as follows:
a. Annually, not later than the thirtieth (30
th) day of April, beginning with the
year following the year in which Conversion occurs, Borrower will submit to Authority an audited Annual Financial Statement for the preceding calendar year, prepared by a certified public accountant reasonably acceptable to the Authority, determining the amount of Residual Receipts, if any, generated in that year, together with payment of the Authority’s Share of such Residual Receipts. The first such Annual Financial Statement will be for the partial year beginning on the date of Conversion and ending on December 31 of that year. The Authority will review and approve such Annual Financial Statement, or r equest reasonable revisions, within 30 days after receipt. If as the result of the Authority’s review of the statement, there is an increase in the amount of any payment due and payable to Authority (as the result, for example, of a determination that the actual amount of Residual Receipts to which the Authority is entitled exceeds the amount of Authority’s share of Residual Receipts shown in the Annual Financial Statement submitted by Borrower), Borrower will promptly pay to the Authority the difference, with interest, from the date on which such payment was due, at the rate of one percent (1%) over the Prime Rate announced by Bank of America, but in any event within ten (10) days of notice of such increase. b. The Authority’s Share of Residual Receipts to be applied to this Note, the LMIHAF Note, and the Measure S Note will be 50%. The Authority’s Share of Residual Receipts will be applied to the HOME Note, the LMIHAF Note, and the Measure S Note as follows: 11.96% (i.e., $1,800,000/$ 15,050,000) will be applie d to the HOME Note, 11.46% (i.e., $1,725,000/$15,050,000) will be applied to the LMIHAF Note, and 76.58% (i.e., $11,525,000/$15,050,000) will be applied to the Measure S Note.

9. All payments applie d to this Note will be applied first to penalties and late fees, then to interest, then to reduce the principal amount owed.

10. The HOME Loan evidenced by this Note is based on the assumption that, upon completion and stabilization, all Acquisition and Development Costs will be $59,761,000 and the maximum amount of the Permanent Loan to be secured by a first priority deed of trust will be [$____________]. To induce Authority to make the HOME Loan evidenced hereby, Borrower covenants and agrees as follows:
a. If Borrower obtains a Permanent Loan in a principal amount in excess of [$16,950,000], Borrower will apply an amount equal to fifty percent (50%) of the proceeds thereof in excess of [$16,950,000] (the “Additional Proceeds ”) to pay accrued interest on, and then reduce the princip al amount of the LMIHAF Loan, the Measure S Loan, and the HOME Loan, except to the extent such Additional Proceeds are needed to either pay for cost overruns for which 234 of 422
Draft

900 East Broadway
HOME Note