Lancaster City Council
August 26, 2025

DISPOSITION AND DEVELOPMENT AGREEMENT
By and Between

LANCASTER HOUSING AUTHORITY
and
PACIFIC WEST COMMUNITIES, INC.

APN: 3125-009-908
2 TABLE OF CONTENTS
DISPOSITION AND DEVELOPMENT AGREEMENT.....................................ERROR! BOOKMARK NOT DEFINED. 100. DEFINITIONS ............................................................................................. ERROR! BOOKMARK NOT DEFINED. 101. REPRESENTATIONS AND WARRANTIES.................................................................. ERROR! BOOKMARK NOT DEFINED. 200. DISPOSITION OF SITE............................................................................. ERROR! BOOKMARK NOT DEFINED. 201. DISPOSITION OF SITE TO DEVELOPER.................................................................... ERROR! BOOKMARK NOT DEFINED. 202. PAYMENT OF THE PURCHASE PRICE...................................................................... ERROR! BOOKMARK NOT DEFINED. 203. ESCROW................................................................................................................. ERROR! BOOKMARK NOT DEFINED. 204. REVIEW OF TITLE. ................................................................................................. ERROR! BOOKMARK NOT DEFINED. 205. TITLE INSURANCE.................................................................................................. ERROR! BOOKMARK NOT DEFINED. 206. CONDITIONS OF CLOSING. ..................................................................................... ERROR! BOOKMARK NOT DEFINED. 207. STUDIES AND REPORTS.......................................................................................... ERROR! BOOKMARK NOT DEFINED. 208. TAXES AND ASSESSMENTS. ................................................................................... ERROR! BOOKMARK NOT DEFINED. 209. CONDITION OF THE SITE. ....................................................................................... ERROR! BOOKMARK NOT DEFINED. 300. DEVELOPMENT OF PROJECT SITE .................................................... ERROR! BOOKMARK NOT DEFINED. 301. SCOPE OF DEVELOPMENT...................................................................................... ERROR! BOOKMARK NOT DEFINED. 302. CONSTRUCTION DRAWINGS AND RELATED DOCUMENTS. ................................... ERROR! BOOKMARK NOT DEFINED. 303. LAND USE APPROVALS.......................................................................................... ERROR! BOOKMARK NOT DEFINED. 304. SCHEDULE OF PERFORMANCE. .............................................................................. ERROR! BOOKMARK NOT DEFINED. 305. COST OF CONSTRUCTION....................................................................................... ERROR! BOOKMARK NOT DEFINED. 306. FINANCING OF THE DEVELOPER IMPROVEMENTS.................................................. ERROR! BOOKMARK NOT DEFINED. 307. INSURANCE REQUIREMENTS. ................................................................................ ERROR! BOOKMARK NOT DEFINED. 308. INDEMNITY............................................................................................................. ERROR! BOOKMARK NOT DEFINED. 309. RIGHTS OF ACCESS. ............................................................................................... ERROR! BOOKMARK NOT DEFINED. 310. COMPLIANCE WITH LAWS. .................................................................................... ERROR! BOOKMARK NOT DEFINED. 311. TAXES AND ASSESSMENTS. ................................................................................... ERROR! BOOKMARK NOT DEFINED. 312. RELEASE OF CONSTRUCTION COVENANTS. .......................................................... ERROR! BOOKMARK NOT DEFINED. 400. COVENANTS AND RESTRICTIONS ...................................................... ERROR! BOOKMARK NOT DEFINED. 401. AFFORDABLE HOUSING. ........................................................................................ ERROR! BOOKMARK NOT DEFINED. 403. NONDISCRIMINATION. ........................................................................................... ERROR! BOOKMARK NOT DEFINED. 404. MAINTENANCE OF THE SITE. ................................................................................. ERROR! BOOKMARK NOT DEFINED. 405. LONG TERM MANAGEMENT OF THE SITE.............................................................. ERROR! BOOKMARK NOT DEFINED. 500. DEFAULTS, REMEDIES, AND TERMINATION .................................. ERROR! BOOKMARK NOT DEFINED. 501. DEFAULT REMEDIES.............................................................................................. ERROR! BOOKMARK NOT DEFINED. 502. INSTITUTION OF LEGAL ACTIONS.......................................................................... ERROR! BOOKMARK NOT DEFINED. 503. TERMINATION BY DEVELOPER. ............................................................................. ERROR! BOOKMARK NOT DEFINED. 504. TERMINATION BY AUTHORITY............................................................................... ERROR! BOOKMARK NOT DEFINED. 505. REENTRY AND REVESTING OF TITLE IN AUTHORITY AFTER THE CLOSING AND PRIOR TO COMPLETION OF CONSTRUCTION. ................................................................................................................ERROR! BOOKMARK NOT DEFINED. 506. ACCEPTANCE OF SERVICE OF PROCESS................................................................. ERROR! BOOKMARK NOT DEFINED. 507. RIGHTS AND REMEDIES ARE CUMULATIVE. ......................................................... ERROR! BOOKMARK NOT DEFINED. 508. INACTION NOT A WAIVER OF DEFAULT................................................................ ERROR! BOOKMARK NOT DEFINED. 509. APPLICABLE LAW.................................................................................................. ERROR! BOOKMARK NOT DEFINED. 600. GENERAL PROVISIONS .......................................................................... ERROR! BOOKMARK NOT DEFINED. 601. NOTICES, DEMANDS AND COMMUNICATIONS BETWEEN THE PARTIES. ............... ERROR! BOOKMARK NOT DEFINED. 3 602. ENFORCED DELAY; EXTENSION OF TIMES OF PERFORMANCE.............................. ERROR! BOOKMARK NOT DEFINED. 603. NON-LIABILITY OF OFFICIALS AND EMPLOYEES OF AUTHORITY /NON-LIABILITY OF DEVELOPER. ERROR! BOOKMARK NOT DEFINED.
604. RELATIONSHIP BETWEEN PARTIES. ....................................................................... ERROR! BOOKMARK NOT DEFINED. 605. AUTHORITY APPROVALS AND ACTIONS................................................................ ERROR! BOOKMARK NOT DEFINED. 606. COMMENCEMENT OF CITY REVIEW PERIOD. ........................................................ ERROR! BOOKMARK NOT DEFINED. 607. COUNTERPARTS..................................................................................................... ERROR! BOOKMARK NOT DEFINED. 608. INTEGRATION......................................................................................................... ERROR! BOOKMARK NOT DEFINED. 609. [INTENTIONALLY OMITTED.] ................................................................................. ERROR! BOOKMARK NOT DEFINED. 610. REAL ESTATE BROKERAGE COMMISSION. ............................................................ ERROR! BOOKMARK NOT DEFINED. 611. ADMINISTRATION. ................................................................................................. ERROR! BOOKMARK NOT DEFINED. 612. AMENDMENTS OF AGREEMENT............................................................................. ERROR! BOOKMARK NOT DEFINED. 613. TITLES AND CAPTIONS. ......................................................................................... ERROR! BOOKMARK NOT DEFINED. 614. INTERPRETATION................................................................................................... ERROR! BOOKMARK NOT DEFINED. 615. NO WAIVER. .......................................................................................................... ERROR! BOOKMARK NOT DEFINED. 616. MODIFICATIONS..................................................................................................... ERROR! BOOKMARK NOT DEFINED. 617. SEVERABILITY. ...................................................................................................... ERROR! BOOKMARK NOT DEFINED. 618. COMPUTATION OF TIME. ....................................................................................... ERROR! BOOKMARK NOT DEFINED. 619. LEGAL ADVICE. ..................................................................................................... ERROR! BOOKMARK NOT DEFINED. 620. TIME OF ESSENCE. ................................................................................................. ERROR! BOOKMARK NOT DEFINED. 621. COOPERATION. ...................................................................................................... ERROR! BOOKMARK NOT DEFINED. 622. CONFLICTS OF INTEREST. ...................................................................................... ERROR! BOOKMARK NOT DEFINED. 623. TIME FOR ACCEPTANCE OF AGREEMENT BY AUTHORITY. ................................... ERROR! BOOKMARK NOT DEFINED. 624. REPRESENTATIONS AND WARRANTIES.................................................................. ERROR! BOOKMARK NOT DEFINED. 625. TRANSFERS OF INTEREST IN SITE OR AGREEMENT................................................ ERROR! BOOKMARK NOT DEFINED.

EXHIBIT A SCHEDULE OF PERFORMANCE

EXHIBIT B SCOPE OF DEVELOPMENT

EXHIBIT C SITE MAP

EXHIBIT D SITE LEGAL DESCRIPTION

EXHIBIT E SITE GRANT DEED

EXHIBIT F RELEASE OF CONSTRUCTION COVENANTS

EXHIBIT G RESIDENTIAL DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS

AND REGULATORY AGREEMENT
4 DISPOSITION AND DEVELOPMENT AGREEMENT
THIS DISPOSITION AND DEVELOPMENT AGREEMENT (this “Agreement”) is entered into and effective as of [DATE] (the “Date of Agreement”), by and between the LANCASTER HOUSING AUTHORITY, public body corporate and politic (“Authority”), and PACIFIC WEST COMMUNITIES, INC., an Idaho general business corporation (“Developer”), with reference to the following facts, intentions and understandings.

R E C I T A L S
A. Authority is the fee owner of that certain surplus real property (the “Site”) legally described in the legal description attached as Exhibit D (the “Site Legal Description”) and visually depicted on the site map attached as Exhibit C (the “Site Map”).

B. By Resolution 20-49, adopted September 8, 2020, City declared the Site to be surplus property pursuant to the Surplus Land Act (Cal. Gov’t Code §§ 54220-54234) (“Surplus Land Act”).

On September 10, 2020, City sent notices of availability as and to the extent required by the Surplus Land Act (specifically, section 54222(a) of the California Government Code). City received one response expressing interest in the Site, but the responding entity failed to negotiate its acquisition of the Site or respond to City’s communications. Upon expiration of the ninety-day negotiation period required by the Surplus Land Act, no entity receiving a notice of availability was prepared to purchase the Site.

C. Developer offered to purchase the Site from the Authority at fair market value to construct an affordable multi-family development, subject to the terms, conditions, and requirements of this Agreement. City is providing no assistance, subsidies, or public funds to Developer under this Agreement in any manner.

D. By letter dated October 7, 2022, the California Department of Housing and Community Development (“HCD”) determined the City satisfied the requirements of the Surplus Land Act and may proceed with the sale or lease of the Site.

NOW, THEREFORE, in consideration of the mutual covenants and conditions hereinafter set forth, the parties hereto agree as follows:
100. DEFINITIONS
“Affordability Period” is defined in Section 401.2.
“Affordable Rents” shall have the meaning set forth in Health and Safety Code Section 50053, as in effect of the date hereof, as calculated for lower income households. “Agreement” means this Disposition and Development Agreement by and between the Authority and Developer.
“Approved Developer Broker Commission” means the commission payable to Developer’s real estate agent or broker at Closing. The Approved Developer Broker Commission is subject to City prior review and approval.
“Authority” means the Lancaster Housing Authority, public body corporate and politic. 5 “Authority’s Conditions Precedent” is defined in Section 206.1. “CalHFA” means the California Housing Finance Agency or successor in function. “CC&Rs” means the Declaration of Conditions, Covenants and Restrictions in substantially similar form as attached hereto as Exhibit G, which is incorporated herein by reference. “CDLAC” means the California Debt Limitation Allocation Committee or successor in function. “CEQA” means the California Environmental Quality Act, Public Resources Code Sections 21000, et seq.
“City” means the City of Lancaster, a charter city and California municipal corporation. “City Code” means the Municipal Code of the City of Lancaster, including the Uniform Codes, all as amended from time to time.
“City Manager” means the City Manager of the City, or his or her designee. “City Regulatory Agreement” means the Regulatory Agreement and Declaration of Restrictive Covenants, Conditions, and Restrictions Restricting the Use of Property for Affordable Housing in substantially the form of Exhibit H attached to this DDA. “Closing” is defined in Section 203.4.
“Closing Date” is defined in Section 203.4.
“Date of Agreement” is defined in the first paragraph of this Agreement. “Developer” means Pacific West Communities, Inc., an Idaho general business corporation and its approved successors and assigns.
“Developer’s Conditions Precedent” is defined in Section 206.2. “Developer Improvements” means the improvements described in the Scope of Development and all improvements incidental thereto.
“Environmental Consultant” is defined in Section 209.2. “Escrow” is defined in Section 203.
“Escrow Agent” is defined in Section 203.
“Exceptions” is defined in Section 204.
“Executive Director” means the Executive Director of the Authority, or his or her designee. “Governmental Requirement(s)” means all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State of California, the County of Los Angeles, City or any other political subdivision in which the Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over City, Developer or the Site. 6 “Hazardous Materials” means any substance, material or waste which is or becomes, prior to the Closing, regulated by any local governmental authority, the State of California or the United States Government, including, but not limited to, any material or substance which is (i) defined as a “hazardous waste,” “extremely hazardous waste,” or “restricted hazardous waste” under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law), (ii) defined as a “hazardous substance” under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter-Presley-Tanner Hazardous Substance Account Act), (iii) defined as a “hazardous material,” “hazardous substance,” or “hazardous waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory), (iv) defined as a “hazardous substance” under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances), (v) petroleum, (vi) friable asbestos, (vii) polychlorinated biphenyls, (viii) listed under Article 9 or defined as “hazardous” or “extremely hazardous” pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20, (ix) designated as “hazardous substances” pursuant to Section 311 of the Clean Water Act (33 U.S.C. Section 1317), (x) defined as a “hazardous waste” pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Sections 6901 et seq. (42 U.S.C. Section 6903) or (xi) defined as “hazardous substances” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Sections 6901, et seq. “Outside Date” means the third anniversary of the Date of Agreement. “Purchase Price” means the sum of Two Million Nine Hundred Forty Thousand Dollars ($2,940,000.00) as provided in Section 201.
“Qualified Resident” means a person or household whose Gross Income is equal to or less than the income limits specified in Section 401.1.
“Site” means that certain property which is described in the Site Legal Description attached hereto as Exhibit G.
“Site Grant Deed” means a grant deed substantially in the form of Exhibit E to this Agreement. “Release of Construction Covenants” means the Release of Construction Covenants attached hereto as Exhibit F.
“Report” is defined in Section 204.
“Right of Entry Agreement” is defined in Section 207.
“Schedule of Performance” means the Schedule of Performance attached hereto as Exhibit A. “Scope of Development” means the Scope of Development attached hereto as Exhibit B. “Site Map” means the Site Map attached hereto as Exhibit C. “Surplus Land Act” is defined in Recital B.
“Title Company” is defined in Section 204.
7 “Title Policy” is defined in Section 205.
“Uniform Codes” mean each of the following as in effect from time to time as approved by City:
the Uniform Building Code, the Uniform Housing Code, the National Electrical Code, the Uniform Plumbing Code, the Uniform Mechanical Code, and the Uniform Code for Abatement of Dangerous Buildings.
101. Representations and Warranties.
101.1Authority Representations. Authority represents and warrants to Developer as follows:
(a) Authority. Authority is a public body corporate and politic. Authority has full right, power and lawful authority to convey the Site, including portions thereof, as provided herein and the execution, performance, and delivery of this Agreement by Authority has been fully authorized by all requisite actions on the part of Authority. The individual who has executed this Agreement on behalf of Authority is authorized to bind Authority by his or her signature hereto. (b) Litigation. To the best of Authority’s knowledge, there are no actions, suits, material claims, legal proceedings, or any other proceedings affecting the Site or any portion thereof, at law or in equity before any court or governmental agency, domestic or foreign. (c) No Conflict. To the best of Authority’s knowledge, Authority’s execution, delivery, and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Authority is a party or by which it is bound.
(d) No Developer Bankruptcy. Developer is not the subject of a bankruptcy proceeding.

Until the Closing, Authority shall, upon learning of any fact or condition which would cause any of the warranties and representations in this Section 101.1 not to be true as of the Closing, immediately give written notice of such fact or condition to Developer. Such exception(s) to a representation shall not be deemed a breach by Authority hereunder but shall constitute an exception which Developer shall have a right to approve or disapprove if such exception would have an effect on the value and/or operation of property to be conveyed under the Closing. If Developer elects to accept the conveyance of the Site and the possession of the following disclosure of such information, Authority’s representations and warranties contained herein shall be deemed to have been made as of such the Closing, subject to such exception(s). The representations and warranties set forth in this Section 101.1 shall survive the Closing.
101.2Developer Representations. Developer represents and warrants to Authority as follows:
(a) Authority. Developer is an Idaho general business corporation and has full right, power and lawful authority to acquire and accept title to and possession of the Site, including portions thereof, and undertake all obligations as provided herein and the execution, performance and delivery of this Agreement by Developer has been fully authorized by all requisite actions on the part of Developer. The individual who has executed this Agreement on behalf of Developer is authorized to bind Developer by his or her signatures hereto.
8 (b) Litigation. To the best of Developer’s knowledge, there are no actions, suits, material claims, legal proceedings, or any other proceedings affecting Developer, at law or in equity before any court or governmental agency, domestic or foreign. (c) No Conflict. To the best of Developer’s knowledge, Developer’s execution, delivery, and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Developer is a party or by which it is bound.
(d) No Developer Bankruptcy. Developer is not the subject of a bankruptcy proceeding.
(e) Developer Experience; Sophisticated Party. Developer is a sophisticated party, with substantial experience in the acquisition, rehabilitation, development, financing, obtaining financing for, marketing, and operation of similar properties, and has obtained advice from advisers of its own choosing in connection with this Agreement. (f) Due Authorization and Execution. Developer has duly authorized the execution of this Agreement, including without limitation the attachments hereto.

Until the Closing, Developer shall, upon learning of any fact or condition which would cause any of the warranties and representations in this Section 101.2 not to be true as of such Disposition Conveyance, immediately give written notice of such fact or condition to Authority. Such exception(s) to a representation shall not be deemed a breach by Developer hereunder but shall constitute an exception which Developer shall have a right to approve or disapprove if such exception would have an effect on the value and/or operation of the Site. If Developer elects to accept the Site and the possession of the Site following disclosure of such information, Authority’s representations and warranties contained herein shall be deemed to have been made as of the Closing, subject to such exception(s). The representations and warranties set forth in this Section 101.2 shall survive the Closing. 200. DISPOSITION OF SITE
201. Disposition of Site to Developer. Developer agrees to purchase the Site from the Authority and Authority agrees to sell the Site to Developer, pursuant and subject to the terms, covenants, and conditions of this Agreement, for the Purchase Price. 202. Payment of the Purchase Price. Developer shall pay Fifty Thousand Dollars ($50,000.00) of the Purchase Price in cash, to be deposited into the Escrow within ten (10) days of Authority opening the Escrow as provided in Section 203, below. Said Fifty Thousand Dollars ($50,000.00) shall be applied to the Purchase Price at Closing. Developer shall pay the balance of the Purchase Price in cash, to be deposited into the Escrow prior and as a condition to the Closing.

Developer’s payment of the full Purchase Price shall be a condition precedent to the Closing. 203. Escrow. By the time established therefor in the Schedule of Performance, Authority shall open escrow (the “Escrow”) with First American Title Company of Visalia (Attn. Ann Kay) or another escrow company mutually satisfactory to both parties (the “Escrow Agent”). 203.1Costs of Escrow. Authority and Developer shall pay their respective portions of the premium for the Title Policy as set forth in Section 205, Authority shall pay the documentary transfer taxes, if any, due with respect to the conveyance of the Site, Authority shall pay the Approved 9 Developer Broker Commission, if any, and Authority and Developer each agree to pay one half of all other usual fees, charges, and costs which arise from the Escrow. 203.2Escrow Instructions. This Agreement constitutes the joint escrow instructions of Authority and Developer, and the Escrow Agent to whom these instructions are delivered is hereby empowered to act under this Agreement. The parties hereto agree to do all acts reasonably necessary to close the Escrow in the shortest possible time. Insurance policies for fire or casualty are not to be transferred, and Authority will cancel its own policies after the Closing. All funds received in the Escrow shall be deposited with other escrow funds in a general escrow account(s) and may be transferred to any other such escrow trust account in any State or National Bank doing business in the State of California. All disbursements shall be made by check from such account.

If in the opinion of either party it is necessary or convenient in order to accomplish the Closing, such party may require that the parties sign supplemental escrow instructions; provided that if there is any inconsistency between this Agreement and the supplemental escrow instructions, then the provisions of this Agreement shall control. The parties agree to execute such other and further documents as may be reasonably necessary, helpful or appropriate to effectuate the provisions of this Agreement. The Closing shall take place when both Authority’s Conditions Precedent and Developer’s Conditions Precedent as set forth in Section 206 have been satisfied. The Escrow Agent is instructed to release Authority’s escrow closing and Developer’s escrow closing statements to the respective parties.
203.3Authority of Escrow Agent. The Escrow Agent is authorized to, and shall:
(a) Pay and charge Authority for the premium of the Title Policy as set forth in Section 205, any amount necessary to place title to the Site in the condition necessary to satisfy Section 204, and the Approved Developer Broker Commission (as determined by the Executive Director).
(b) Pay and charge Authority and Developer for their respective shares of any escrow fees, charges, and costs payable under Section 203.1. (c) Pay and charge Developer for the cost of an ALTA policy (if any) and for any endorsements to the Title Policy which are requested by Developer as set forth in Section 205 and which are in excess of the premium for the Title Policy payable by Authority pursuant to Section 205.
(d) Disburse funds and deliver and record the Site Grant Deed when both Authority’s Conditions Precedent and Developer’s Conditions Precedent have been fulfilled or waived by Authority and Developer.
(e) Do such other actions as necessary, including obtaining the Title Policy, to fulfill its obligations with respect to the Site under this Agreement. (f) Within the discretion of the Escrow Agent and, if necessary, direct Authority and Developer to execute and deliver any instrument, affidavit, and statement, and to perform any act reasonably necessary to comply with the provisions of FIRPTA and any similar state act and regulation promulgated thereunder. Authority agrees to execute a Certificate of Non-Foreign Status and/or a Certification of Compliance with Real Estate Reporting Requirement of the 1986 Tax Reform Act as may be required by the Escrow Agent, on a form or forms to be supplied by the Escrow Agent. 10 (g) Prepare and file with all appropriate governmental or taxing authorities a uniform settlement statement, closing statement, tax withholding forms including an IRS 1099-S form, and be responsible for withholding taxes, if any such forms are provided for or required by law. (h) Verify that this Agreement has been properly executed by the parties prior to the Closing.
203.4Closing. The conveyance of the Site shall close by accomplishment of conveyance of the Site to Developer and receipt by Authority of the Purchase Price (the “Closing”) within thirty (30) days after the satisfaction of all of Authority’s and Developer’s Conditions Precedent as set forth in Section 206 and no later than the Outside Date. The “Closing” shall mean the time and day the Site Grant Deed is filed for record with the Los Angeles County Recorder. The “Closing Date” shall mean the day on which the Closing occurs.
203.5Termination. If the Escrow is not in condition to close by the Outside Date, then either party which has fully performed under this Agreement may, in writing, demand the return of money or property, terminate the Escrow, and terminate this Agreement. If either party makes a written demand for return of documents or properties, Escrow shall not terminate until five (5) days after the Escrow Agent shall have delivered copies of such demand to all other parties at the respective addresses shown in this Agreement. If any objections are raised within said five (5) day period, the Escrow Agent is authorized to hold all papers and documents until instructed by a court of competent jurisdiction or by mutual written instructions of the parties. Termination of the Escrow shall be without prejudice as to whatever legal rights either party may have against the other arising from this Agreement. If no demands are made, the Escrow Agent shall proceed with the Closing as soon as possible.
203.6Closing Procedure. The Escrow Agent shall close the Escrow for the Site as follows:
(a) Verify execution of this Agreement by the parties;
(b) Record the Site Grant Deed, with instructions for the Recorder of Los Angeles County, California to deliver the Site Grant Deed to Developer; (c) Record the CC&Rs, with instructions for the Recorder of Los Angeles County, California to deliver the recorded CC&Rs to the Authority; (d) Instruct the Title Company to deliver the Title Policy to Developer; (e) Disburse the Purchase Price, less Authority’s costs of the Closing, to Authority;
(f) File any informational reports required by Internal Revenue Code Section 6045(e), as amended, and any other applicable requirements; (g) Deliver the FIRPTA Certificate, if any, to Developer; (h) Forward to both Authority and Developer a separate accounting of all funds received and disbursed for each party and copies of all executed and recorded or filed documents deposited into the Escrow, with such recording and filing date and information endorsed thereon; and (i) Record documents requested by Developer subsequent to the recordation of the Site Grant Deed.
204. Review of Title. Within sixty (60) days after the Date of Agreement, Authority shall cause First American Title Company (the “Title Company”), to deliver to Developer an ALTA 11 preliminary title report (the “Report”) with respect to the title to the Site, together with legible copies of the documents underlying the exceptions (“Exceptions”) set forth in the Report. Developer shall have the right to reasonably approve or disapprove the Exceptions.

Within the time set forth in the Schedule of Performance, Developer shall give written notice to Authority and the Escrow Agent of Developer’s approval or disapproval of any of such Exceptions. Developer’s failure to give written disapproval of the Report within such time limit shall be deemed approval of the Report and the Exceptions set forth therein. If Developer notifies Authority of its disapproval of any Exceptions in the Report, Authority shall have the right, but not the obligation, to remove any disapproved Exceptions within five (5) days after receiving written notice of Developer’s disapproval or provide assurances reasonably satisfactory to Developer that such Exception(s) will be removed on or before the Closing. If Authority cannot or does not elect to remove any of the disapproved Exceptions within that period, Authority shall provide written notice of such election to Developer within such five (5) day period. Developer shall then have ten (10) business days after the expiration of such five (5) business day period to either give Authority written notice that Developer elects to proceed with the purchase of the Site subject to the disapproved Exceptions or to give Authority written notice that Developer elects to terminate this Agreement. Developer shall have the right to approve or disapprove any Exceptions reported by the Title Company after Developer has approved the Report for the Site (which are not created by Developer). Authority shall not voluntarily create any new exceptions to title following the Date of Agreement. 205. Title Insurance. Concurrently with recordation of the Site Grant Deed conveying title to the Site to Developer, there shall be issued to Developer a CLTA owner’s policy of title insurance (the “Title Policy”), together with such endorsements as are reasonably requested by Developer, issued by the Title Company insuring that the title to the Site is vested in Developer in the condition required by Section 204. The Title Company shall provide Authority with a copy of the Title Policy. The Title Policy shall be in the amount of the Purchase Price. Authority shall pay that portion of the premium for the Title Policy equal to the cost of a CLTA standard coverage title policy in the amount of the Purchase Price. Any additional costs, including the cost of an ALTA policy or any endorsements requested by Developer, shall be borne by Developer.
206. Conditions of Closing. The Closing is conditioned upon the satisfaction of the following terms and conditions within the times designated below:
206.1Authority’s Conditions of Closing. Authority’s obligation to proceed with the Closing of the conveyance of the Site is subject to the fulfillment, or waiver by Authority in writing, of each and all of the conditions precedent (a) through (j), inclusive, described below (the “Authority’s Conditions Precedent”), which are solely for the benefit of Authority, and which shall be fulfilled or waived in writing by Authority by the time periods provided for herein, or if no time period is provided, prior to the Closing:
(a)No Default. Prior to the Closing, Developer is not in default in any of its obligations under the terms of this Agreement and all representations and warranties of Developer contained herein shall be true and correct in all material respects. (b)Execution of Documents. Developer shall have executed and delivered into Escrow this Agreement, and any other documents required pursuant to the terms of this Agreement. (c)Payment of Purchase Price and Closing Costs. Not later than three (3) business days prior to the Closing, Developer shall have delivered to Escrow the Purchase Price and its share of costs of the Closing which are Developer’s obligation in accordance with Section 203.1. 12 (d)Title Policy. The Title Company shall, upon payment of Title Company’s regularly scheduled premium, have agreed to provide the Title Policy for the Site upon the Closing, in accordance with Section 205.
(e)Condition of Site. Developer shall have approved of the physical and environmental condition of the Site.
(f)Land Use Approvals. Developer shall have received all land use approvals for the Developer Improvements required pursuant to Section 303 hereof. (g)Plans and Permits. Developer shall have obtained approval of its final building plans for the Developer Improvements and grading, building and other required permits, as applicable, shall be ready to be issued (upon payment of requisite fees, posting of security and similar items).
(h)Financing. Developer shall have provided proof satisfactory to Authority that Developer has sufficient internal funds and/or has obtained a loan or other financing for acquisition of the Site and construction and operation of the Developer Improvements pursuant to Section 309 hereof, and such financing shall close and fund and shall be available to Developer upon the Closing.
(i)Proof of Insurance. Developer shall have provided, for Authority’s review and approval, proof of insurance reasonably satisfactory to Authority in accordance with Section 307.
(j)Approval of Preliminary Title Report. Developer shall have approved the Report.
206.2Developer’s Conditions of Closing. Developer’s obligation to accept conveyance of the Site is subject to the fulfillment or waiver by Developer in writing of each and all of the conditions precedent (a) through (i), inclusive, described below (“Developer’s Conditions Precedent”), which are solely for the benefit of Developer, and which shall be fulfilled or waived in writing by Developer by the time periods provided for herein:
(a)No Default. Authority is not in default in any of its obligations under the terms of this Agreement and all representations and warranties of Authority contained herein shall be true and correct and not misleading in all material respects. (b)Execution of Documents. Authority shall have executed and delivered into Escrow this Agreement, the Site Grant Deed, and any other documents required pursuant to the terms of this Agreement.
(c)Payment of Closing Costs. Prior to the Closing, Authority has paid or submitted into Escrow all costs of the Closing which are Authority’s obligation in accordance with Section 203.1.
(d)Title Policy. The Title Company shall, upon payment of Title Company’s regularly scheduled premium, have agreed to provide the Title Policy for the Site upon the Closing, in accordance with Section 205.
(e)Environmental Condition of Site. Developer shall have approved of the 13 environmental condition of the Site.
(f)Land Use Approvals. Developer shall have received all land use approvals for the Developer Improvements required pursuant to Section 303. (g)Plans and Permits. Developer shall have obtained approval of its final building plans for the Developer Improvements and grading, building and other required permits, as applicable, shall be ready to be issued (upon payment of requisite fees, posting of security and similar items).
(h)Financing. Developer shall have provided proof satisfactory to Authority that Developer has sufficient internal funds and/or has obtained a loan or other financing for acquisition of the Site and construction and operation of the Developer Improvements pursuant to Section 306 hereof, and such financing shall close and fund and shall be available to Developer upon the Closing.
(i)Approval of Preliminary Title Report. Developer shall have approved the Report.
207. Studies and Reports. Prior to the Closing and upon Developer’s execution of a right of entry agreement to be provided by Authority (the “Right of Entry Agreement”), representatives of Developer shall have the right of access to all portions of the Site owned by Authority for the purpose of obtaining data and making surveys and tests necessary to carry out this Agreement. Any preliminary work undertaken on the Site by Developer prior to the Closing shall be done at the sole expense of Developer and Developer shall defend, indemnify and hold Authority harmless from any claims resulting from all preliminary work, access or use of the Site undertaken pursuant to this Section 207.

Any preliminary work shall be undertaken only after securing any necessary permits from the appropriate governmental agencies.
208. Taxes and Assessments. Ad valorem taxes and assessments, if any, on the Site levied, assessed, or imposed for any period prior to the Closing, shall be borne by Authority. All ad valorem taxes and assessments levied or imposed for any period after the Closing shall be paid by Developer. 209. Condition of the Site.
209.1As-Is Condition. Notwithstanding any provisions of this Agreement to the contrary (except as set forth in Section 624.2(d) of this Agreement), the Site shall be conveyed in an “as is” condition, with no warranty, express or implied by Authority, as to the condition of improvements on the Site, the soil, its geology, the presence of known or unknown faults or Hazardous Materials or toxic substances, and Developer agrees to and shall indemnify and hold Authority harmless from and against all liability, loss, damages, costs, or expenses (including reasonable attorneys’ fees and court costs) arising from or as a result of the existence of such faults or substances. Notwithstanding the foregoing, Developer shall not be responsible for matters related to any environmental contamination which existed prior to the Closing. It shall be the sole responsibility of Developer at its expense to investigate and determine the soil and improvement conditions for the development to be constructed. If the soil and environmental condition is not in all respects entirely suitable for the use or uses to which the Site will be put, then it is the sole responsibility and obligation of Developer to take such action as may be necessary to place the soil and environmental conditions of the Site in a condition entirely suitable for its development. 209.2Investigation of Site. Developer, upon execution of the Right of Entry Agreement, shall have the right, at its sole cost and expense, to engage its own environmental 14 consultant (the “Environmental Consultant”) to make such investigations as Developer deems necessary, including any “Phase I” or “Phase II” investigations of the Site. Developer shall provide Authority with a copy of any and all studies and reports provided to Developer by the Environmental Consultant, or such other consultant engaged by Developer. The Site is to be sold on a where is, as is basis with no representations as to the Site or its condition being made by Authority. 209.3Approval of Environmental Condition of Site. Developer shall have the right to approve the environmental condition of the Site prior to Developer’s obligation to acquire the Site.

Developer shall approve or disapprove of the environmental condition of the Site within one hundred and eighty (180) days after the Date of Agreement. Developer’s approval of the environmental condition of the Site shall be Developer’s Condition Precedent to Closing, as set forth in Section 206.2 hereof.
209.4Developer’s Precautions after Closing. Upon the Closing, Developer shall take all necessary precautions to prevent the release into the environment of any Hazardous Materials which are located in, on or under the Site. Such precautions shall include compliance with all Governmental Requirements with respect to Hazardous Materials. In addition, Developer shall install and utilize such equipment and implement and adhere to such procedures as are consistent with commercially reasonable standards as respects the disclosure, storage, use, removal and disposal of Hazardous Materials in, on or under the Site.
209.5Required Disclosures After Closing. After the Closing, Developer shall notify Authority, and provide to Authority a copy or copies, of all notices of violation, notices to comply, citations, inquiries, clean up or abatement orders, cease and desist orders, reports filed pursuant to self- reporting requirements and reports filed or applications made pursuant to any Governmental Requirement relating to Hazardous Materials and underground tanks. Developer shall report to Authority, as soon as possible after each incident, any known Hazardous Materials release or known circumstances which would potentially lead to such a release. 209.6Developer Indemnity - Hazardous Materials. Upon the Closing, Developer agrees to indemnify, defend and hold Authority, and its respective officers, employees, agents, representatives and volunteers, harmless from and against any claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense (including, without limitation, attorneys’ fees), resulting from, arising out of, or based upon the following occurring subsequent to the Closing (i) the presence, release, use, generation, discharge, storage or disposal of any Hazardous Materials on, under, in or about, or the transportation of any such Hazardous Materials to or from, the Site, or (ii) the violation, or alleged violation, of any statute, ordinance, order, rule, regulation, permit, judgment or license relating to the use, generation, release, discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or from, the Site, unless due to the gross negligence or willful misconduct of Authority and its respective officers, employees, agents, representatives and volunteers. This indemnity shall include, without limitation, any damage, liability, fine, penalty, parallel indemnity after closing cost or expense arising from or out of any claim, action, suit or proceeding for personal injury (including sickness, disease or death), tangible or intangible property damage, compensation for lost wages, business income, profits or other economic loss, damage to the natural resource or the environment, nuisance, contamination, leak, spill, release or other adverse effect on the environment.
300. DEVELOPMENT OF PROJECT SITE
301. Scope of Development. Developer shall within the time set forth in the Schedule of Performance develop or cause the development of the Developer Improvements in accordance with the 15 Scope of Development, City Code, all entitlements and approvals for the Site, and the plans, drawings and documents submitted by Developer and approved by City as set forth herein. Developer shall, without limitation, apply for and secure, and pay all costs, charges and fees associated therewith, all permits and fees required by City, County, and other governmental agencies with jurisdiction over the Developer Improvements.
302. Construction Drawings and Related Documents. Prior to commencement of construction, Developer shall prepare and submit to City, construction drawings, landscape plans, and related documents required for the development of the Site and the construction of the Developer Improvements (the “Construction Drawings”). Authority shall have the right of review of all Construction Drawings, including any proposed changes therein. Authority shall not be responsible either to Developer or to third parties in any way for any defects in the Construction Drawings, nor for any structural or other defects in any work done according to the approved Construction Drawings, nor for any delays reasonably caused by the review and approval processes conducted by City. Any and all change orders or revisions required by City and its inspectors under the City Code, including without limitation, all applicable Uniform Codes (e.g., Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and regulations shall be included by Developer in its Construction Drawings and other required submittals and shall be completed during the construction of the Developer Improvements.
303. Land Use Approvals. Prior to commencement of construction of the Developer Improvements or other works of improvement upon the Site by Developer, Developer shall, at its own expense, secure or cause to be secured any and all land use and other entitlements, and approvals, including environmental approvals, which may be required by City and/or any other governmental agency affected by such construction or work for the Developer Improvements. Developer shall, without limitation, apply for and secure all permits required by City, the County and other governmental agencies with jurisdiction over the Developer Improvements. 304. Schedule of Performance. Developer shall submit the Construction Drawings, commence and complete all construction of the Developer Improvements, and satisfy all other obligations and conditions of this Agreement within the times established therefor in the Schedule of Performance. During the course of construction and prior to issuance of the Release of Construction Covenants, Developer shall provide timely reports of the progress of construction when requested by Authority. Developer shall complete construction of all the Developer Improvements within the respective times established therefor in the Schedule of Performance. The Schedule of Performance is subject to revision from time-to-time as mutually agreed upon in writing by Developer and Authority and Authority is authorized to make such revisions as it deems reasonably necessary. 305. Cost of Construction. The cost of planning, designing, developing and constructing the Developer Improvements shall be borne solely by Developer. 306. Financing of the Developer Improvements.
306.1Approval of Financing. As required herein and as one of Authority’s Conditions Precedent, Developer shall submit evidence that Developer has or has obtained sufficient equity capital and/or has obtained firm and binding commitments for construction financing necessary to undertake the acquisition and development of the Site and the construction and operation of the Developer Improvements in accordance with this Agreement, to Authority for review and approval.

Such review and approval or disapproval of financing commitments shall be made within fifteen (15) days of receipt of a complete submission. Authority shall not unreasonably withhold, delay or 16 condition such approval. If Authority shall disapprove any such evidence of financing, it shall do so by notice to Developer stating the reasons for such disapproval, in which event Developer shall use commercially reasonable efforts to promptly obtain and submit new evidence of financing. Authority shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 306.1 for the approval or disapproval of the evidence of financing as initially submitted. Developer shall close any approved construction financing prior to or concurrently with the Closing.

Such evidence of financing shall include the following: (a) a copy of an enforceable loan commitment(s) obtained by Developer from one or more financial institutions for the mortgage loan or loans for construction financing for the Developer Improvements, subject to such lenders’ reasonable, customary and normal conditions and terms, and/or (b) evidence reasonably acceptable to Authority that Developer has sufficient funds for such construction, and that such funds have been committed to such construction, and/or other documentation satisfactory to Authority as evidence of other sources of capital sufficient to demonstrate that Developer has adequate funds to cover the difference between the total cost of the acquisition of the Site and construction and completion of the Developer Improvements, less financing authorized by those loans set forth in subparagraph (a) above, and (c) evidence of sufficient capital to operate the Developer Improvements in accordance with the Scope of Development.
306.2Holder Not Obligated to Construct Improvements. The holder of any mortgage or deed of trust authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct or complete the Developer Improvements or any portion thereof, or to guarantee such construction or completion; nor shall any covenant or any other provision in this Agreement be construed so to obligate such holder. Nothing in this Agreement shall be deemed to construe, permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. Notwithstanding the foregoing, Authority shall reasonably cooperate with Developer’s construction and permanent lenders in connection with the permitted use or uses to which such lender may devote the Site following a foreclosure or deed in lieu of foreclosure.
306.3Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure. With respect to any mortgage or deed of trust granted by Developer as provided herein, whenever Authority may deliver any notice or demand to Developer with respect to any breach or default by Developer in completion of construction of the Developer Improvements, Authority shall at the same time deliver to each holder of record of any mortgage or deed of trust and any limited partner a copy of such notice or demand. Each such holder and limited partner shall (insofar as the rights granted by Authority are concerned) have the right, at its option, within sixty (60) days after the receipt of the notice, to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such default. Nothing contained in this Agreement shall be deemed to permit or authorize such holder or limited partner to undertake or continue the construction or completion of the Developer Improvements, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed Developer’s obligations to Authority by written agreement reasonably satisfactory to Authority. The holder or limited partner, in that event, must agree to complete, in the manner provided in this Agreement, the improvements to which the lien or title of such holder relates. Any such holder or limited partner properly completing such improvement shall be entitled, upon compliance with the requirements of Section 312, to a Release of Construction Covenants. 307. Insurance Requirements. Developer shall take out and maintain or shall cause its contractor to take out and maintain until the issuance of the Release of Construction Covenants 17 pursuant to Section 312, a comprehensive general liability policy in the amount of Two Million Dollars ($2,000,000.00) combined single limit policy, or such other policy limits as Authority may approve at its discretion, including contractual liability, as shall protect Developer and Authority from claims for such damages. Such policy or policies shall be written on an occurrence form. Developer shall also furnish or cause to be furnished to Authority evidence satisfactory to Authority that Developer and any contractor with whom it has contracted for the performance of work on the Site or otherwise pursuant to this Agreement carries workers’ compensation insurance as required by law. Developer shall furnish a notarized certificate of insurance countersigned by an authorized agent of the insurance carrier on a form approved by Authority setting forth the general provisions of the insurance coverage. This countersigned certificate shall name Authority and its respective officers, agents, and employees as additionally insured parties under the policy, and the certificate shall be accompanied by a duly executed endorsement evidencing such additional insured status. Developer shall notify Authority of any material change, cancellation or termination of the coverage at least thirty (30) days in advance of the effective date of any such material change, cancellation or termination. Coverage provided hereunder by Developer shall be primary insurance and not be contributing with any insurance maintained by Authority, and the policy shall contain such an endorsement. The insurance policy or the endorsement shall contain a waiver of subrogation for the benefit of Authority. The required certificate shall be furnished by Developer prior to the commencement of construction of the Developer Improvements. 308. Indemnity.
308.1Developer’s Indemnity. Developer shall defend (by counsel satisfactory to Authority), indemnify and save and hold harmless Authority and its officers, contractors, agents and employees (collectively, the “Indemnitees”) from and against all claims, damages, demands, actions, losses, liabilities, costs and expenses (including, without limitation, attorneys’ fees and court costs) arising from or relating to: (i) Developer’s compliance with this Agreement (including all provisions hereof); (ii) compliance with applicable laws; (iii) a claim, demand or cause of action that any person has or asserts against Developer; (iv) any act or omission of Developer, any contractor, subcontractor or material supplier, engineer, architect or other person with respect to the Site; (v) those matters set forth in Section 101.2 hereof; or (vi) the ownership, occupancy or use of the Site and any portions thereof after the Closing. Notwithstanding the foregoing, Developer shall not be obligated to indemnify Authority with respect to the consequences of any act of gross negligence not contributed to by Developer or willful misconduct of Authority. Developer’s obligations under this Section 308 shall survive the issuance of the Release of Construction Covenants and termination of this Agreement; the requirements under this Section 308 are in addition to and do not limit the obligations of Developer under the Site Grant Deed.

Developer shall reimburse Authority immediately upon written demand for all costs reasonably incurred by Authority (including the reasonable fees and expenses of experts, attorneys, accountants, appraisers and other consultants, whether the same are independent contractors or employees of Authority) in connection with the enforcement of the this Agreement and all related matters including the following: (a) Authority’s commencement of, appearance in, or defense of any action or proceeding purporting to affect the rights or obligations of the parties to this Agreement or the Site Grant Deed, and (b) all claims, demands, causes of action, liabilities, losses, commissions and other costs against which Authority is indemnified under this Agreement or the Site Grant Deed. Such reimbursement obligations shall bear interest at the rate of seven percent (7%) simple per annum (or, if lower, the highest non-usurious interest rate that may be charged) based upon the amounts and times of disbursement by Authority, provided that Authority gives written demand to Developer. Such reimbursement obligations shall survive the issuance of the Release of Construction Covenants and termination of this Agreement and are in addition to and do not limit the obligations of Developer under the Site Grant Deed or other instruments associated with the conveyance of any portion of the Site. 18 Upon the Closing, Developer shall take all necessary precautions to prevent the release into the environment of any Hazardous Materials which are located in, on or under the Site. Such precautions shall include compliance with all Governmental Requirements with respect to Hazardous Materials. In addition, Developer shall install and utilize such equipment and implement and adhere to such procedures as are consistent with commercially reasonable standards as respects the disclosure, storage, use, removal and disposal of Hazardous Materials. Notwithstanding anything contained herein to the contrary, Developer shall not indemnify Authority for any claims arising from Authority’s gross and active negligence or Authority’s willful misconduct so long as the loss alleged is not caused or contributed to by Developer and the foregoing indemnification shall not apply to the presence, use, release, escape, seepage, leakage, spillage, emission, or discharge of any Hazardous Materials in, on, under, or about the Site where such Hazardous Material existed on the property prior to the Closing. 308.2Authority’s Indemnity. Authority shall defend, indemnify, assume all responsibility for, and hold harmless Developer, and its representatives, volunteers, officers, employees and agents, from and against all claims, demands, damages, defense costs or liability of any kind or nature relating to Authority’s compliance this Agreement or the implementation hereof and for any damages to property or injuries to persons, including accidental death (including attorneys’ fees and costs), which are legally caused by any acts or omissions of Authority under this Agreement, whether such activities or performance thereof be by Authority or by anyone directly or indirectly employed or contracted with by Authority and whether such damage shall accrue or be discovered before or after termination of this Agreement.
309. Rights of Access. Representatives of Authority shall have the right of access to the Site, without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including but not limited to, the inspection of the work being performed in constructing the Developer Improvements so long as Authority representatives comply with all generally applicable safety rules.
310. Compliance with Laws. Developer shall carry out the design and construction of the Developer Improvements in conformity with all applicable laws, including all applicable state labor standards, City zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of City Code, and all applicable disabled and handicapped access requirements, including without limitation the Americans With Disabilities Act, 42 U.S.C. Sections 12101, et seq., California Government Code Sections 4450, et seq., California Government Code Sections 11135, et seq., and the Unruh Civil Rights Act, California Civil Code Sections 51, et seq. 310.1Nondiscrimination in Employment. Developer certifies and agrees that, to the extent applicable to it, all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding companies, and all subcontractors, bidders and vendors, are and will be treated equally by it without regard to, or because of race, color, religion, ancestry, national origin, sex, age, pregnancy, childbirth or related medical condition, medical condition (cancer related) or physical or mental disability, and in compliance with Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sections 2000, et seq., the Federal Equal Pay Act of 1963, 29 U.S.C. Section 206(d), the Age Discrimination in Employment Act of 1967, 29 U.S.C. Sections 621, et seq., the Immigration Reform and Control Act of 1986, 8 U.S.C. Sections 1324b, et seq., 42 U.S.C. Section 1981, the California Fair Employment and Housing Act, California Government Code Sections 12900, et seq., the California Equal Pay Law, California Labor Code Sections 1197.5, California Government Code Section 11135, the Americans with Disabilities Act, 42 U.S.C. Sections 12101, et seq., and all other anti-discrimination laws and regulations of the United States and the State of California as they now exist or may hereafter be amended. Developer shall allow representatives of Authority access to its employment records related to this Agreement during regular business hours to verify compliance with these provisions when so 19 requested by Authority.
310.2Public Works Requirements. Developer shall carry out the construction of the Developer Improvements and the development of the Site in conformity with all applicable federal and state labor laws (including, without limitation, if applicable, the requirement under California law to pay prevailing wages and to hire apprentices). Although the parties believe that the Developer Improvements are not considered to be a “public work” under California law because the Site is being sold for a price not less than the appraised fair market value of the Site, Developer shall be solely responsible for determining and effectuating compliance with such laws, and Authority makes no representation as to the applicability or non-applicability of any of such laws to the Developer Improvements or any part thereof. Developer hereby expressly acknowledges and agrees that Authority has not previously affirmatively represented to Developer or its contractor(s) for the construction or development of the Developer Improvements, in writing or otherwise, in a call for bids or otherwise, that the work to be covered by this Agreement is not a “public work,” as defined in Section 1720 of the Labor Code. Developer hereby agrees that Developer shall have the obligation to provide any and all disclosures or identifications required by Labor Code Section 1781, as the same may be amended from time to time, or any other similar law. Developer shall indemnify, protect, defend and hold harmless Authority and its officers, employees, contractors and agents, with counsel reasonably acceptable to Authority, from and against any and all loss, liability, damage, claim, cost, expense and/or “increased costs” (including reasonable attorneys’ fees, court and litigation costs, and fees of expert witnesses) which, in connection with the development, construction (as defined by applicable law) and/or operation of the Developer Improvements, including, without limitation, any and all public works (as defined by applicable law), results or arises in any way from any of the following: (1) the noncompliance by Developer of any applicable local, state and/or federal law, including, without limitation, any applicable federal and/or state labor laws (including, without limitation, if applicable, the requirement to pay state prevailing wages and to hire apprentices); (2) the implementation of Section 1781 of the Labor Code, as the same may be amended from time to time, or any other similar law; and/or (3) failure by Developer to provide any required disclosure or identification as required by Labor Code Section 1781, as the same may be amended from time to time, or any other similar law. It is agreed by the parties that, in connection with the development and construction (as defined by applicable law) of the Developer Improvements, including, without limitation, any and all public works (as defined by applicable law), Developer shall bear all risks of payment or non-payment of prevailing wages and hiring of apprentices under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar law. “Increased costs,” as used in this Section 310.2, shall have the meaning ascribed to it in Labor Code Section 1781, as the same may be amended from time to time. The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the construction and development of the Developer Improvements by Developer.
311. Taxes and Assessments. Developer shall remove or have removed any levy or attachment for any taxes and assessments incurred after the Closing, made on the Site, or any part thereof, or assure the satisfaction thereof within a reasonable time; provided however, the Developer shall not be required to pay and discharge any such tax, assessment, charge or levy so long as (a) the legality thereof shall be promptly and actively contested in good faith and by appropriate proceedings and, (b) the Developer maintains reserves adequate to pay any liabilities contested. 312. Release of Construction Covenants. Promptly after completion of the Developer Improvements in conformity with this Agreement, Authority shall furnish Developer with the Release of Construction Covenants. Authority shall not unreasonably withhold such Release of Construction Covenants. The Release of Construction Covenants shall be a conclusive determination of satisfactory 20 completion of the Developer Improvements and the Release of Construction Covenants shall so state.

Any party then owning or thereafter purchasing, leasing or otherwise acquiring any interest in the Site shall not (because of such ownership, purchase, lease or acquisition) incur any obligation or liability under this Agreement except for those matters which constitute continuing obligations of Developer under the Site Grant Deed or otherwise under this Agreement. If Authority refuses or fails to furnish the Release of Construction Covenants for the Site after written request from Developer, Authority shall, within ten (10) working days of such written request, provide Developer with a written statement setting forth the reasons Authority has refused or failed to furnish the Release of Construction Covenants for the Site. The statement shall also contain a list of the actions Developer must take to obtain a Release of Construction Covenants.

Such Release of Construction Covenants shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of any mortgage, or any insurer of a mortgage securing money loaned to finance the improvements, or any part thereof. Such Release of Construction Covenants is not a notice of completion as referred to in the California Civil Code, Section 3093. 400. COVENANTS AND RESTRICTIONS
401. Affordable Housing.
401.1Number of Units. As set forth in Section 301 of this Agreement and the Scope of Development, Developer shall construct the number and mix of residential units on the Site, all of which will be designated for and occupied at Affordable Rents by Qualified Residents. “Qualified Residents” means lower income households as defined by California Health and Safety Code Section 50079.5. Notwithstanding the foregoing, during such time that the Project is subject to a regulatory agreement restricting occupancy and/or rents pursuant to requirements imposed by the California Tax Credit Allocation Committee (“TCAC”). Affordable Rents shall be the more restrictive of (i) the rent limitations required by TCAC and (ii) the rent limitations set forth in Health and Safety Code Section 50053(b)(2).
401.2Period of Affordability. During the entire term of the Affordability Period, Developer agrees to make available, restrict occupancy to, and rent each residential unit to Qualified Residents at Affordable Rents. In addition to any requirements of the Authority Code, Developer agrees to comply with the provisions of California Health and Safety Code Section 33413 through Section 33418 to the extent necessary to enable the City to count the units for purposes of meeting the requirements of Section 33413 of the California Health and Safety Code. During the Affordability Period Developer shall provide information reasonably required by Authority to satisfy its reporting obligations under applicable law. The “Affordability Period” means the period beginning upon the first day of the first full month following the date on which the first unit in the Project is occupied and ending on the last day of the 660th month thereafter.
401.3Annual Reports. During the Affordability Period, Developer, at its expense, shall submit to the Authority the reports required pursuant to Health and Safety Code Section 33418, as the same may be amended from time to time, with each such report to be in the form prescribed by the Authority. Each annual report shall cover the immediately preceding calendar year. 402. Uses. Developer covenants and agrees to devote, use, develop, operate and maintain the Site in accordance with the Site Grant Deed, the CC&Rs and this Agreement. All uses conducted on the Site, including, without limitation, all activities undertaken by Developer pursuant to this Agreement, shall conform to all Entitlements, Permits, all applicable provisions of the City Code, and the recorded documents pertaining to and running with the Site. 21 403. Nondiscrimination. Developer by and for itself and any successors in interest covenants that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer 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 Site.

The foregoing covenants shall run with the land.

All such deeds, leases or contracts shall 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 race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee 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, subtenants, sublessees or vendees in the land 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:
‘There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, ancestry or national origin 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 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.’” (c) In contracts: “There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, creed, religion, sex, marital status, physical or mental disability or medical condition, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferee 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, subtenants, sublessees or vendees of the premises.” 404. Maintenance of the Site. From and after the completion of the Project on any portion of the Site, the Developer shall maintain or cause to be maintained the interiors and exteriors of the Developer Improvements on the Site in a decent, safe and sanitary manner, in accordance with the standard of maintenance of similar housing units within the Authority, and in accordance with the maintenance standards that are set forth in the CC&Rs. None of the dwelling units on the Site shall at any time be utilized on a transient basis nor shall the Site or any portion thereof ever be used as a hotel, motel, dormitory, fraternity or sorority house, rooming house, hospital, nursing home, sanitarium or rest home. Developer shall not convert the Site to condominium ownership without the prior written 22 approval of the Authority, which approval the Authority may grant, withhold or deny in its sole and absolute discretion. If at any time Developer fails to maintain the Site in accordance with this Agreement or the CC&Rs and Developer does not correct or commence to correct such condition within ten (10) days after written notice from the Authority with respect to graffiti, debris, waste material, and general maintenance, or thirty (30) days after written notice from the Authority with respect to landscaping and building improvements, then the Authority, in addition to whatever remedy it may have at law or at equity, shall have the right to enter upon the applicable portion of the Site and perform all acts and work reasonably necessary to protect, maintain, and preserve the Improvements and landscaped areas on the Site, and to attach a lien upon the Site, or assess the Site, in the amount of the expenditures arising from such acts and work of protection, maintenance, and preservation by the Authority and/or costs of such cure, including a ten percent (10%) administrative charge, which amount shall be promptly paid by Developer to the Authority upon demand. Pursuant to the CC&Rs, the foregoing covenants shall run with the land for the term of the Affordability Period. 405. Long Term Management of the Site. The parties acknowledge that the Authority is interested in the long-term management and operation of the Site and in the qualifications of any person or entity retained by Developer for that purpose (the “Property Manager”). The Authority may from time- to-time review and evaluate the identity and performance of the Property Manager of the Site and the Property Manager’s compliance with the provisions of this Agreement and the CC&R’s. If the Authority reasonably determines that the performance of the Property Manager is deficient based upon the standards and requirements set forth in this Agreement and the CC&R’s, the Authority shall provide written notice to Developer of such deficiencies and Developer shall use commercially reasonable efforts to correct or cause to be corrected such deficiencies. Upon Default of the terms of this Agreement or the CC&Rs by the Property Manager, the Authority shall have the right to require Developer to remove and replace the Property Manager with another property manager or property management company reasonably acceptable to the Authority, subject to the rights of the senior lender and limited partner. Such Property Manager shall be experienced in managing multifamily residential developments similar to the Project and may be related to or affiliated with the Developer. Pursuant to the CC&Rs, the foregoing covenants shall run with the land for the term of the Affordability Period. 500. DEFAULTS, REMEDIES, AND TERMINATION
501. Default Remedies. Subject to the extensions of time set forth in Section 702 of this Agreement, failure by either party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and failure to cure as described hereafter, constitutes a “Default” under this Agreement. A party claiming a Default (the “Claimant”) shall give written notice to the other party specifying the alleged grounds for the Default (the “Default Notice”). Except as otherwise expressly provided in this Agreement, the Claimant shall not institute any proceeding against any other party and the other party shall not be in Default if such party within forty-five (45) days from receipt of the notice required by this Section 501 immediately, with due diligence, commences to cure, correct or remedy such failure or delay and shall complete such cure, correction or remedy with diligence.
502. Institution of Legal Actions. In addition to any other rights or remedies and subject to the restrictions otherwise set forth in this Agreement, either party may institute an action at law or equity to seek specific performance of the terms of this Agreement, or to cure, correct or remedy any Default, to recover damages for any Default, or to obtain any other remedy consistent with the purpose of this Agreement. Such legal actions must be instituted in the Superior Court of the County of Los Angeles, State of California, in an appropriate municipal court in that county, or in the United States District Court for the Central District of California.
23 503. Termination by Developer. In the event that as of the time designated therefor in this Agreement (and if no time is described below, the time established in this Agreement for the satisfaction of the Authority’s Conditions Precedent):
503.1Termination Prior to the Closing. In the event that prior to the Closing:
(a) Developer is not in default under this Agreement and Developer has not notified Authority that the condition of the Site is acceptable; or (b) Developer is not in default under this Agreement and Authority does not execute the Site Grant Deed and attempt to effect the conveyance of the Site to Developer in the manner and condition and by the date provided in this Agreement; or (c) Authority is otherwise in default of this Agreement prior to the conveyance of the Site which is not cured within the time set forth in Section 501 hereof; (d) and any such failure is not cured within the applicable time period after written demand by Developer, then this Agreement may, at the option of Developer, be terminated by Notice thereof to Authority. From the date of the Notice of termination of this Agreement by Developer to Authority and thereafter, and this Agreement shall be deemed terminated and there shall be no further rights or obligations among the parties.
504. Termination by Authority.
504.1Termination Prior to the Closing. In the event that as of the time established therefor in this Agreement, but not later than the time established for the satisfaction of the Authority’s Conditions Precedent:
(a) Developer (or any successor in interest) assigns this Agreement or any rights therein or in the Site in violation of this Agreement; or (b) Authority has not received notification from Developer that the condition of the Site is satisfactory; or
(c) One of more of the Authority’s Conditions Precedent is not satisfied; or (d) Developer fails to execute the Site Grant Deed; or
(e) Developer is otherwise in default of this Agreement and fails to cure such default within the time set forth in Section 501 hereof; (f) then this Agreement and any rights of Developer or any assignee or transferee with respect to or arising out of the Agreement or the Site (including without limitation all attachments to this Agreement), shall, at the option of Authority, be terminated by Authority by Notice thereof to Developer. From the date of the Notice of termination of this Agreement by Authority to Developer and thereafter this Agreement (including without limitations all attachments hereto) shall be deemed terminated excepting that Developer shall have conveyed or caused to be conveyed to Authority (or a nominee designated by Authority for such purpose) the Site, unless Developer is otherwise instructed by Authority in a writing that mentions this Section 504 and there shall be no further rights or obligations among the parties, except that Authority may pursue any remedies it has hereunder.
24 505. Reentry and Revesting of Title in Authority after the Closing and Prior to Completion of Construction. Authority has the right, at its election, to reenter and take possession of the Site, with all improvements thereon, and terminate and revest in Authority the estate conveyed to Developer if after the Closing and prior to the issuance of the Release of Construction Covenants, Developer (or its successors in interest) shall:
(a) fail to start the construction of the Developer Improvements as required by this Agreement for a period of thirty (30) days after written notice thereof from Authority, unless such failure is due to causes beyond the reasonable control of Developer, and Developer has requested and received from Authority an extension of time, which shall not be unreasonably withheld, conditioned, or delayed, and which shall be for a period reasonably related to the scope and nature of the delay; or (b) abandon or substantially suspend construction of the Developer Improvements required by this Agreement for a period of thirty (30) days after written notice thereof from Authority; or
(c) fail to complete the Developer Improvements required by this Agreement within the time frame set forth in the Schedule of Performance or as amended; or (d) transfer or suffer any involuntary transfer of the Site or any part thereof in violation of Section 625 of this Agreement.

Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: (i) any mortgage or deed of trust permitted by this Agreement; or (ii) any rights or interests provided in this Agreement for the protection of the holders of such mortgages or deeds of trust.

The Site Grant Deed shall contain appropriate reference and provision to give effect to Authority’s right as set forth in this Section 505, under specified circumstances prior to recordation of the Release of Construction Covenants, to reenter and take possession of the Site, with all improvements thereon, and to terminate and revest in Authority the estate conveyed to Developer.

Upon the revesting in Authority of title to the Site as provided in this Section 505, Authority shall, pursuant to its responsibilities under state law, use its reasonable efforts to resell the Site as soon and in such manner as Authority shall find feasible, to a qualified and responsible party or parties (as determined by Authority) who will assume the obligation of making or completing the Developer Improvements, or such improvements in their stead as shall be satisfactory to Authority. Upon such resale of the Site, the net proceeds thereof after repayment of any mortgage or deed of trust encumbering the Site, which is permitted by this Agreement, shall be applied:
(i) First, to reimburse Authority, on its own behalf or on behalf of Authority, all costs and expenses incurred by Authority, excluding Authority staff costs, but specifically, including, but not limited to, any expenditures by Authority in connection with the recapture, management and resale of the Site or part thereof (but less any income derived by Authority from the Site or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to the Site or part thereof which Developer has not paid (or, in the event that the Site is exempt from taxation or assessment of such charges during the period of ownership thereof by Authority, an amount, if paid, equal to such taxes, assessments, or charges as would have been payable if the Site were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Site or part thereof at the time of revesting of title thereto in Authority, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or 25 acts of Developer, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the Developer Improvements or any part thereof; and any amounts otherwise owing Authority, and in the event additional proceeds are thereafter available, then (ii) Second, to reimburse Developer, its successor or transferee, up to the amount equal to the sum of (a) the costs incurred for the acquisition and development of the Site and for the improvements existing on the Site at the time of the reentry and possession, less (b) any gains or income withdrawn or made by Developer from the Site or the improvements thereon.

Any balance remaining after such reimbursements shall be retained by Authority as its property. The rights established in this Section 505 are not intended to be exclusive of any other right, power or remedy, but each and every such right, power, and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that Authority will have conveyed the Site to Developer for economic development purposes, and not for speculation in undeveloped land.
506. Acceptance of Service of Process. In the event that any legal action is commenced by Developer against Authority, service of process on Authority shall be made as provided by law. In the event that any legal action is commenced by Authority against Developer, service of process on Developer shall be made by personal service upon Developer or in such other manner as may be provided by law.
507. Rights and Remedies Are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party 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 the other party. 508. Inaction Not a Waiver of Default. Any failures or delays by either party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. 509. Applicable Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement.
600. GENERAL PROVISIONS
601. Notices, Demands and Communications between the Parties. Any approval, disapproval, demand, document or other notice (“Notice”) required or permitted under this Agreement must be in writing and shall be sufficiently given if delivered by hand (and a receipt therefor is obtained or is refused to be given) or dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered by telecopy or overnight delivery service to:

To Authority: Lancaster Housing Authority
44933 North Fern Avenue
Lancaster, California 93534
Attention: Executive Director
26 To Developer: Pacific West Communities, Inc.
430 E. State Street, Suite #100
Eagle, ID 83616
Attn: Caleb Roope
Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section 601.
602. Enforced Delay; Extension of Times of Performance. In addition to specific provisions of this Agreement, performance by either party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to: litigation challenging the validity of this transaction or any element thereof or the right of either party to engage in the acts and transactions contemplated by this Agreement; inability to secure necessary labor materials or tools; delays of any contractor, sub- contractor or supplier; or withdrawal of financing not caused by any act or omission of Developer; war; insurrection; strikes; lockouts; 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; unusually severe weather; acts or omissions of the other party; acts or failures to act of Authority or any other public or governmental agency or entity (other than the acts or failures to act of Authority which shall not excuse performance by Authority); or any other causes beyond the control or without the fault of the party claiming an extension of time to perform. Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within forty-five (45) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of Authority and Developer. Notwithstanding any provision of this Agreement to the contrary, the lack of funding to complete the Developer Improvements shall not constitute valid grounds of enforced delay pursuant to this Section 602. 603. Non-Liability of Officials and Employees of Authority /Non-Liability of Developer. No member, official or employee of Authority shall be personally liable to Developer, or any successor in interest, in the event of any Default or breach by Authority or for any amount which may become due under the terms of this Agreement.
604. Relationship between Parties. It is hereby acknowledged that the relationship between the parties is not that of a partnership or joint venture and that no party shall be deemed or construed for any purpose to be the agent of any other party. Accordingly, except as expressly provided herein or in the Exhibits hereto, Authority shall have no rights, powers, duties or obligations with respect to the development, operation, maintenance or management of the Site. Developer agrees to indemnify, hold harmless and defend Authority from any claim made against Authority arising from a claimed relationship of partnership or joint venture between Authority and Developer with respect to the development, operation, maintenance or management of the Site. 605. Authority Approvals and Actions. Whenever a reference is made herein to an action or approval to be undertaken by Authority, the Executive Director is authorized to act on behalf of Authority unless specifically provided otherwise or the context should require otherwise. 606. Commencement of City Review Period. The time periods set forth herein for City’s approval of agreements, plans, drawings, or other information submitted to City by Developer and for any other City consideration and approval hereunder which is contingent upon documentation required 27 to be submitted by Developer shall only apply and commence upon Developer’s complete submittal of all the required information. In no event shall an incomplete submittal by Developer trigger any of City’s obligations of review and/or approval hereunder; provided, however, that City shall notify Developer of an incomplete submittal as soon as is practicable and in no event later than the applicable time set forth for City’s action on the particular item in question. 607. Counterparts. This Agreement may be signed in multiple counterparts which, when signed by all parties, shall constitute a binding agreement. This Agreement is executed in two (2) originals, each of which is deemed to be an original.
608. Integration. This Agreement contains the entire understanding between the parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous agreements, understandings, representations and statements, oral or written, are merged in this Agreement and shall be of no further force or effect. Each party is entering this Agreement based solely upon the representations set forth herein and upon each party’s own independent investigation of any and all facts such party deems material.
609. [Intentionally Omitted.]
610. Real Estate Brokerage Commission. Each party agrees to indemnify, defend, and hold the other harmless from and against any real estate broker or finder’s commissions or fees or claims thereto alleged to be owed in connection with the Site, which may be the responsibility of Developer or Authority.
611. Administration. This Agreement shall be administered and executed by Executive Director, or his or her designated representative, following approval of this Agreement by Authority.

Authority shall maintain authority of this Agreement through the Executive Director (or his or her authorized representative). The Executive Director shall have the authority to issue interpretations, waive provisions and enter into amendments of this Agreement on behalf of Authority so long as such actions do not substantially change the uses or development permitted on the Site, or add to the costs to Authority as specified herein as agreed to by the Lancaster Housing Authority, and such amendments may include extensions of time specified in the Schedule of Performance. All other waivers or amendments shall require the written consent of the Lancaster Housing Authority. 612. Amendments of Agreement. The parties agree to mutually consider reasonable requests for amendments to this Agreement. Developer shall be responsible for the reasonable costs incurred by Authority, including without limitation reasonable attorneys’ fees (the “Developer Costs”), in connection with any amendments to this Agreement which are requested by Developer (the “Developer Request”). Developer shall be responsible for payment of Developer Costs as provided in this Section 612 regardless of the outcome of Developer Request. 613. Titles and Captions. Titles and captions are for convenience of reference only and do not define, describe or limit the scope or the intent of this Agreement or of any of its terms. Reference to section numbers are to sections in this Agreement, unless expressly stated otherwise. 614. Interpretation. As used in this Agreement, masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others where and when the context so dictates. The word “including” shall be construed as if followed by the words “without limitation.” This Agreement shall be interpreted as though prepared jointly by the parties. 615. No Waiver. A waiver by any party of a breach of any of the covenants, conditions or agreements under this Agreement to be performed by the other party shall not be construed as a waiver 28 of any succeeding breach of the same or other covenants, agreements, restrictions or conditions of this Agreement.
616. Modifications. Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made in writing and in each instance signed on behalf of each party. 617. Severability. If any term, provision, condition or covenant of this Agreement or its application to any party or circumstances shall be held, to any extent, invalid or unenforceable, the remainder of this Agreement, or the application of the term, provision, condition or covenant to persons or circumstances other than those as to whom or which it is held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the fullest extent permitted by law. 618. Computation of Time. The time in which any act is to be done under this Agreement is computed by excluding the first day (such as the day escrow opens) and including the last day, unless the last day is a holiday or Saturday or Sunday, and then that day is also excluded. The term “holiday” shall mean all holidays as specified in Section 6700 and 6701 of the California Government Code. If any act is to be done by a particular time during a day, that time shall be Pacific Time Zone time. 619. Legal Advice. Each party represents and warrants to the other the following: they have carefully read this Agreement, and in signing this Agreement, they do so with full knowledge of any right which they may have; they have received independent legal advice from their respective legal counsel as to the matters set forth in this Agreement, or have knowingly chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have freely signed this Agreement without any reliance upon any agreement, promise, statement or representation by or on behalf of the other party, or their respective agents, employees or attorneys, except as specifically set forth in this Agreement, and without duress or coercion, whether economic or otherwise. 620. Time of Essence. Time is expressly made of the essence with respect to the performance of each and every obligation and condition of this Agreement. 621. Cooperation. Each party agrees to cooperate with the other in this transaction and, in that regard, to sign any and all documents which may be reasonably necessary, helpful or appropriate to carry out the purposes and intent of this Agreement including, but not limited to, releases or additional agreements.
622. Conflicts of Interest. No member, official or employee of Authority shall have any personal interest, direct or indirect, in this Agreement, nor shall any such member, official or employee participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership or association in which he is directly or indirectly interested. 623. Time for Acceptance of Agreement by Authority. This Agreement, when executed by Developer and delivered to Authority, must be authorized, executed and delivered by Authority within forty-five (45) days or this Agreement shall be void, except to the extent that the parties shall consent in writing to a further extension of time for the authorization, execution and delivery of this Agreement. 624. Representations and Warranties.
624.1Developer’s Representations and Warranties. Developer hereby makes the representations and warranties contained below in this Section 624.1. All of the representations and warranties set forth in this Section 624.1 are effective as of the Date of Agreement. All of the representations and warranties set forth in this Section 624.1 are made with the acknowledgment that 29 they are material, and with the intention that Authority shall rely upon them as inducements to enter into this Agreement and to perform its obligations hereunder and to close the transactions contemplated herein. The representations and warranties contained in this Section 624.1 shall each survive the execution of this Agreement without limitation as to time. (a)Authority. Developer is an Idaho general business corporation.

Developer has full right, power and lawful authority to undertake all obligations as provided herein. (b)No Conflict. Developer’s execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Developer is a party or by which it is bound. (c)No Bankruptcy. Developer is not the subject of a bankruptcy proceeding.
(d)Deliveries. All documents, instruments and other information delivered by Developer to Authority pursuant to this Agreement are true, correct and complete.

Each of the foregoing items (a) to (d), inclusive shall be deemed to be an ongoing representation and warranty. Developer shall advise Authority in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items (a) to (d), inclusive. 624.2Authority’s Representations and Warranties. Authority hereby makes the representations and warranties contained below in this Section 624.2. All of the representations and warranties set forth in this Section 624.2 are effective as of the Date of Agreement. All of the representations and warranties set forth in this Section 624.2 are made with the acknowledgment that they are material, and with the intention that Developer shall rely upon them as inducements to enter into this Agreement and to perform its obligations hereunder and to close the transactions contemplated herein. The representations and warranties contained in this Section 624.2 shall each survive the execution of this Agreement without limitation as to time. (a)Authority. Authority has full right, power and lawful authority to undertake all obligations as provided herein.
(b)No Conflict. Authority’s execution, delivery and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Authority is a party or by which it is bound. (c)Deliveries. All documents, instruments and other information delivered by Authority to Developer pursuant to this Agreement are true, correct and complete. (d)Knowledge. Authority is not aware of any existing state or condition of the property, including, but not limited to the presence of Hazardous Materials or toxic substances, that may preclude Developer from carrying out the Developer Improvements as contemplated in this Agreement.

Each of the foregoing items (a) to (d), inclusive shall be deemed to be an ongoing representation and warranty. Authority shall advise Developer in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items (a) to (d), inclusive. 625. Transfers of Interest in Site or Agreement.
30 625.1Prohibition. The qualifications and identity of Developer are of particular concern to Authority. It is because of those qualifications and identity that Authority has entered into this Agreement with Developer. For the period commencing upon the Date of Agreement and until the issuance of the Release of Construction Covenants, no voluntary or involuntary successor in interest of Developer shall acquire any rights or powers under this Agreement, nor shall Developer make any total or partial sale, grant, transfer, conveyance, assignment, subdivision or lease of the whole or any part of the Site or the Developer Improvements without prior written approval of Authority, except as expressly set forth herein. The Authority expressly authorizes its Executive Director to approve or disapprove any total or partial sale, grant, transfer, conveyance, assignment, subdivision or lease of the whole or any part of the Site or the Developer Improvements. 625.2Permitted Transfers. Notwithstanding any other provision of this Agreement to the contrary, Authority approval of an assignment of this Agreement or conveyance of the Site or the Developer Improvements, or any part thereof, shall not be required in connection with any of the following:
(a) The conveyance or dedication of any portion of the Site to Authority or other appropriate governmental agency, or the granting of easements or permits necessary in order to facilitate construction of the Developer Improvements.
(b) Any transfer to an entity or entities in which Developer retains a minimum of fifty-one percent (51%) of the ownership or beneficial interest and retains management and control of the transferee entity or entities. Transfers shall be permitted, subject to Developer and its Manager retaining management and control of the project. 625.3Authority Consideration of Requested Transfer. Authority agrees that it will not unreasonably withhold approval of a request made pursuant to this Section 625, provided Developer delivers written notice to Authority requesting such approval. Such notice shall be accompanied by
sufficient evidence regarding the proposed assignee’s or purchaser’s development and/or operational qualifications and experience, and its financial commitments and resources, in sufficient detail to enable Authority to evaluate the proposed assignee or purchaser pursuant to the criteria set forth in this Section 625 and as reasonably determined by Authority. Authority shall evaluate each proposed transferee or assignee on the basis of its development and/or operational qualifications and experience and its financial commitments and resources, and may reasonably disapprove any proposed transferee or assignee, during the period for which this Section 625 applies, which Authority determines does not possess equal or better qualifications than Developer. An assignment and assumption agreement in a form satisfactory to Authority’s legal counsel shall also be required for all proposed assignments.

Within thirty (30) days after the receipt of Developer’s written notice requesting Authority approval of an assignment or transfer pursuant to this Section 625, Authority shall either approve or disapprove such proposed assignment or shall respond in writing by stating what further information, if any, Authority requires in order to determine the request complete and determine whether or not to grant the requested approval. Upon receipt of such a response, Developer shall promptly furnish to Authority such further information as may be reasonably requested.
625.4Successors and Assigns. All of the terms, covenants and conditions of this Agreement shall be binding upon Developer and its permitted and/or approved successors and assigns.

Whenever the term “Developer” is used in this Agreement, such term shall include any other permitted and/or approved successors and assigns as herein provided. 31 625.5Assignment by Authority. Authority may assign or transfer any of its rights or obligations under this Agreement at its sole discretion. [Signatures begin on next page.]
32 IN WITNESS WHEREOF, the parties have executed this Agreement as of the date and year first written above.

AUTHORITY:

LANCASTER HOUSING AUTHORITY, public
body corporate and politic
ATTEST:

By: Trolis Niebla
Its: Executive Director
City Clerk
APPROVED AS TO FORM:

City Attorney
DEVELOPER:

PACIFIC WEST COMMUNITIES, INC., an Idaho general
business corporation
_____________________________________________
By: Caleb Roope
Its: President
A-1

EXHIBIT A

SCHEDULE OF PERFORMANCE
For the purposes of this Schedule of Performance, the “Date of Agreement” is [date]. The Executive Director may extend by not more than three hundred sixty (360) days, as all such extensions are aggregated, the time under this Schedule of Performance by which any obligation of Developer shall be performed.

1. Satisfaction of Authority Conditions
Precedent. Developer shall satisfy the
Authority Conditions Precedent.

Within twenty-four (24) months after the Date of
Agreement.

2. Submittal for Land Use Approvals.

Developer submits to City for all land use
approvals required for the Developer
Improvements, including, if applicable,
any conditional use permits.

Within one hundred twenty (120) days after the Date
of Agreement.

3. Opening of Escrow. Escrow opened as to
the Site.

Within ten (10) days after Date of Agreement.

4. Developer Approval as to Title, Condition
of Site. Developer confirms in writing to
the Executive Director that the condition of
the Site and the condition of title are
acceptable.

Within one hundred twenty (120) days after the
Date of Agreement, and in any event, before the
Closing.

5. Conditions Precedent are Satisfied. The
Authority’s Conditions precedent and the
Developer’s Conditions precedent are
satisfied.

Within twenty-four (24) months after the Date of
Agreement.

6. The Site Grant Deed is Recorded. The Site
Grant Deed is recorded.

Within thirty (30) days after the Authority’s
Conditions Precedent are satisfied and not later than
twenty-four (24) months following the Date of
Agreement.

7. Commencement of Construction. The
Developer shall have commenced
construction of the Developer
Improvements.

Within one hundred and twenty (120) days after the
Closing.

8. Completion of Construction. Developer
shall complete construction of the
Developer Improvements.

On or before the second anniversary of the
Closing.

B-1

EXHIBIT B

SCOPE OF DEVELOPMENT
I. GENERAL DESCRIPTION
The Site is specifically delineated on the Site Map and the Site Legal Description.

II. DEVELOPMENT
The Developer shall construct 24 one-bedroom units, 120 two-bedroom units, and 84 three- bedroom units. With the exception of the manager’s unit, all units will be restricted to lower income households earning between 30% and 60% of the area median income (“AMI”) for Los Angeles County, adjusted for household size.

All such approvals, including without limitation, the payment of fees to governmental agencies required in connection therewith, shall constitute the “Developer Improvements.” The Developer shall be responsible for any demolition, grubbing, and grading as necessary to accomplish the construction of the Developer Improvements.

The Developer shall commence and complete the Developer Improvements by the respective times established therefor in the Schedule of Performance.

III. DEVELOPMENT STANDARDS
The Improvements shall conform to all applicable state laws and regulations and to local zoning, applicable provisions of the City Code and the following development standards:

A. General Requirements:

1. Vehicular Access. The placement of vehicular driveways shall be coordinated with the needs of proper street traffic flow as approved by City. In the interest of minimizing traffic congestion, City will control the number and location of curb breaks for access to the Site for off-street parking and truck loading. All access driveways shall require written approval of City staff.

2. Building Signs. Signs shall be limited in size, subdued and otherwise designed to contribute positively to the environment. Signs identifying the building use will be permitted, but their height, size, location, color, lighting and design will be subject to City staff approval, and signs must conform to the City Code.

3. Screening. All outdoor storage of materials or equipment shall be enclosed or screened to the extent and in the manner required by City staff.

4. Landscaping. The Developer shall provide and maintain landscaping within the Site, including the public rights-of-way and within setback area along all street frontages and conforming with the plans as hereafter approved by City. Landscaping shall consist of drought-tolerant B-2
landscaping and trees in keeping with the City’s architecture and design guidelines, as well as installation of an automatic irrigation system adequate to maintain such plant material. The type and size of trees to be planted, together with a landscaping plan, shall be subject to City staff approval prior to planting.

5. Utilities. All utilities on the Site shall be underground at Developer’s expense.

6. Building Design. Buildings shall be constructed such that the Developer Improvements shall be of high architectural quality and shall be effectively and aesthetically designed and in conformance with City approvals.

7. Mitigation Measures. Mitigation measures approved in connection with the development of the Site under the California Environmental Quality Act (CEQA).

B. Design Features:

The following design features are considered essential components to the Improvements:

Security. The details of security will be reviewed upon submission of the detailed plans.

Overall Design Quality, Materials, Colors, Design Features. Quality of design is important, materials and colors are to be approved by the City.

IV. DEMOLITION AND SOILS
The Developer assumes all responsibility for surface and subsurface conditions at the Site, and the suitability of the Site for the Improvements. The Developer has undertaken all investigation of the Site as it shall deem necessary and has not received or relied upon any representations of Authority, or its respective officers, agents and employees.

Entitlements for the entire project are subject to expiration periods set forth in the Lancaster Municipal Code based on project submittal type.

EXHIBIT C SITE MAP
C-1

D-1

EXHIBIT D

SITE LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of Los Angeles, described as follows:

All of that parcel of land being the Southwest quarter of the Northeast quarter of Section 28, Township 7 North, Range 12 West, San Bernardino Base and Meridian, in the City of Lancaster, County of Los Angeles, State of California, according to the official plat of said land, except therefrom that portion lying easterly of the land described as Parcels, 1, 2 and 3 in the Deed to the State of California recorded June 27, 1968 as Instrument No. 417, Official Records of said County, said parcel of land also being described in the Certificate of Compliance recorded September 1, 1988 as Instrument No. 88-1395036, Official Records of said County.

EXCEPTING THEREFROM, that portion of land lying southerly of the following described line; BEGINNING at a point on the West line of said Northeast quarter of Section 28 distant North 0°24’01” West 547.17 from the Southwest corner thereof; thence, 1st - South 89°38’50” East 767.88 feet to the East line of said land, being also the West line of said Parcel 1 in the Deed to the State of California.

RESERVING therefrom an 18 foot wide (18') strip of land along the westerly line of said northeast quarter an easement for public road purposes, as described as beginning at the southwest corner of said southwest quarter of the northeast quarter section 28; thence North 0°17' 26" west along quarter section line, also being the easterly line of Tract No. 43627 filed in Book 1097, page 87 to 91 of Maps, Records of said County, 1055 feet; thence North 89°43' 34" East, 18 feet; thence South 0°17’26" East, 1055 feet to the southerly line of said southwest quarter; thence North 89°38'36" west, 18 feet more or less along said last mentioned southerly line to the point of beginning.

Except therefrom that portion in public roads of record.

E-1

EXHIBIT E

SITE GRANT DEED
[Space above for recorder.]

GRANT DEED
(Including Covenant Pursuant to Section 50079.5 of the California Government Code) For valuable consideration, receipt of which is hereby acknowledged, the LANCASTER HOUSING AUTHORITY, public body corporate and politic (the “Grantor”), hereby grants to PACIFIC WEST COMMUNITIES, INC., an Idaho general business corporation (the “Grantee”), the real property hereinafter referred to as the “Site,” described in Attachment No. 1 attached hereto and incorporated herein, subject to the existing easements, restrictions and covenants of record described there.

1. Grantor excepts and reserves from the conveyance herein described all interest of Grantor in oil, gas, hydrocarbon substances and minerals of every kind and character lying more than five hundred (500) feet below the surface, together with the right to drill into, through and to use and occupy all parts of the Site lying more than five hundred (500) feet below the surface thereof for any and all purposes incidental to the exploration for and production of oil, gas, hydrocarbon substances or minerals from said Site or other lands, but without, however, any right to use either the surface of the Site or any portion thereof within five hundred (500) feet of the surface for any purpose or purposes whatsoever, or to use the Site in such a manner as to create a disturbance to the use or enjoyment of the Site.

2. The Site is conveyed in accordance with and subject to the Disposition and Development Agreement entered into between Grantor and Grantee dated [date] (the “DDA”), a copy of which is on file with Grantor at its offices as a public record and which is incorporated herein by reference. All terms used herein shall have the same meaning as those used in the DDA.

3. If ten (10) or more residential units are developed on the Site, not less than fifteen percent (15%) of the total number of residential units developed on the Site shall be sold or rented at affordable housing cost, as defined in Section 50052.5 of the California Health and Safety Code, or affordable rent, as defined in Section 50053 of the California Health and Safety Code, to lower income households, as defined in Section 50079.5 of the California Health and Safety Code. Rental units shall

RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

Pacific West Communities, Inc.
430 E. State Street, #100
Eagle, ID 83616
Attn: Caleb Roope
E-2
remain affordable to and occupied by lower income households for a period of fifty-five (55) years for rental housing and forty-five (45) years for ownership housing. The initial occupants of all ownership units shall be lower income households, and the units shall be subject to an equity sharing agreement consistent with the provisions of paragraph (2) of subdivision (c) of 65915 of the California Government Code. These requirements shall be covenants or restrictions running with the land and shall be enforceable against any owner who violates a covenant or restriction and each successor-in- interest who continues the violation by any of the entities described in subdivisions (a) to (f), inclusive, of Section 54222.5 of the California Government Code.

4. Grantor has the right, at its election, to reenter and take possession of the Site, with all improvements thereon, and terminate and revest in Grantor the estate conveyed to Grantee if after the Closing but prior to the issuance and recordation of the Release of Construction Covenants, Grantee (or its successors in interest) shall:
a. Fail to start the construction of the Developer Improvements as required by the DDA for a period of one hundred and twenty (120) days after written notice thereof from Authority; or
b. Abandon or substantially suspend construction of the Developer Improvements required by the DDA for a period of thirty (30) days after written notice thereof from Authority; or
c. Fail to complete construction of the Developer Improvements required by the DDA within the time frame set forth in the Schedule of Performance contained therein; or
d. Transfer or suffer any involuntary transfer of the Site or any part thereof in violation of Section 625 of the DDA.

Such right to reenter, terminate and revest shall be subject to and be limited by and shall not defeat, render invalid or limit: (i) any mortgage or deed of trust permitted by the DDA; or (ii) any rights or interests provided in the DDA for the protection of the holders of such mortgages or deeds of trust.

Upon the revesting in Grantor of title to the Site as provided in this Section 3, Grantor shall, pursuant to its responsibilities under state law, use its reasonable efforts to resell the Site for fair market value as soon and in such manner as Grantor shall find feasible to a qualified and responsible party or parties (as determined by Grantor) who will assume the obligation of making or completing the Developer Improvements, or such improvements in their stead as shall be satisfactory to Grantor. Upon such resale of the Site, the net proceeds thereof after repayment of any mortgage or deed of trust encumbering the Site, which is permitted by this Agreement, shall be applied:
i. First, to reimburse Grantor all costs and expenses reasonably incurred by Grantor, excluding Authority staff costs, but specifically, including, but not limited to, any expenditures by Grantor in connection with the recapture, management and resale of the Site or part thereof (but less any income derived by Grantor from the Site or part thereof in connection with such management); all taxes, assessments and water or sewer charges with respect to the Site or part thereof which Grantee has not paid (or, in the event that Site is exempt from taxation or assessment of such charges during the period of ownership thereof E-3
by Grantor, an amount, if paid, equal to such taxes, assessments or charges as would have been payable if the Site were not so exempt); any payments made or necessary to be made to discharge any encumbrances or liens existing on the Site or part thereof at the time of revesting of title thereto in Grantor, or to discharge or prevent from attaching or being made any subsequent encumbrances or liens due to obligations, defaults or acts of Grantee, its successors or transferees; any expenditures made or obligations incurred with respect to the making or completion of the improvements or any part thereof on the Site, or part thereof; and any amounts otherwise owing Grantor, and in the event additional proceeds are thereafter available, then
ii. Second, to reimburse Grantee, its successor or transferee, up to the amount equal to the sum of (a) the costs incurred for the acquisition and development of the Site and for the improvements existing on the Site at the time of the reentry and possession, less (b) any gains or income withdrawn or made by Grantee from the Site or the improvements thereon.

Any balance remaining after such reimbursements shall be retained by Grantor as its property. The rights established in this Section 3 are not intended to be exclusive of any other right, power or remedy, but each and every such right, power and remedy shall be cumulative and concurrent and shall be in addition to any other right, power and remedy authorized herein or now or hereafter existing at law or in equity. These rights are to be interpreted in light of the fact that Grantor will have conveyed the Site to Grantee for economic development purposes, and not for speculation in undeveloped land.

5. Grantee covenants by and for itself and any successors in interest 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 Site, 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 Site. The foregoing covenants shall run with the land.

Grantee shall refrain from restricting the rental, sale or lease of the Site on any of the bases listed above in this Section 4. All such deeds, leases or contracts shall 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.”
E-4
(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 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.”
(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 premises which are the subject of this Agreement, 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.” GRANTOR:

LANCASTER HOUSING AUTHORITY, public
body corporate and politic
By:

Its: Executive Director
GRANTEE:

PACIFIC WEST COMMUNITIES, INC., an Idaho general
business corporation
By: Caleb Roope
Its: President
Attachment No. 1 to Exhibit E-5
ATTACHMENT NO. 1

SITE LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of Los Angeles, described as follows:

All of that parcel of land being the Southwest quarter of the Northeast quarter of Section 28, Township 7 North, Range 12 West, San Bernardino Base and Meridian, in the City of Lancaster, County of Los Angeles, State of California, according to the official plat of said land, except therefrom that portion lying easterly of the land described as Parcels, 1, 2 and 3 in the Deed to the State of California recorded June 27, 1968 as Instrument No. 417, Official Records of said County, said parcel of land also being described in the Certificate of Compliance recorded September 1, 1988 as Instrument No. 88-1395036, Official Records of said County.

EXCEPTING THEREFROM, that portion of land lying southerly of the following described line; BEGINNING at a point on the West line of said Northeast quarter of Section 28 distant North 0°24’01” West 547.17 from the Southwest corner thereof; thence, 1st - South 89°38’50” East 767.88 feet to the East line of said land, being also the West line of said Parcel 1 in the Deed to the State of California.

RESERVING therefrom an 18 foot wide (18') strip of land along the westerly line of said northeast quarter an easement for public road purposes, as described as beginning at the southwest corner of said southwest quarter of the northeast quarter section 28; thence North 0°17' 26" west along quarter section line, also being the easterly line of Tract No. 43627 filed in Book 1097, page 87 to 91 of Maps, Records of said County, 1055 feet; thence North 89°43' 34" East, 18 feet; thence South 0°17’26" East, 1055 feet to the southerly line of said southwest quarter; thence North 89°38'36" west, 18 feet more or less along said last mentioned southerly line to the point of beginning.

Except therefrom that portion in public roads of record.

A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

STATE OF CALIFORNIA )
) ss.

COUNTY OF )
On , before me, , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature of Notary Public

OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s)
Title Or Type Of Document
Number Of Pages
Date Of Documents
Partner(s) Limited General
Attorney-In-Fact
Trustee(s)
Guardian/Conservator
Other:

Signer is representing:

Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above
F-1

EXHIBIT F

RELEASE OF CONSTRUCTION COVENANTS
[Space above for recorder.]

RELEASE OF CONSTRUCTION COVENANTS
THIS RELEASE OF CONSTRUCTION COVENANTS (the “Release”) is made by the LANCASTER HOUSING AUTHORITY, public body corporate and politic (“Authority”), in favor of PACIFIC WEST COMMUNITIES, INC., an Idaho general business corporation (“Developer”), as of the date set forth below.

R E C I T A L S
A. Authority and Developer have entered into that certain Disposition and Development Agreement (the “DDA”) dated [date], concerning the redevelopment of certain real property situated in the City of Lancaster, California as more fully described in Attachment No. 1 attached hereto and made a part hereof. All capitalized terms utilized herein and not otherwise defined shall have the same meaning as set forth in the DDA.

B. As referenced in Section 412 of the DDA, Authority is required to furnish Developer or its successors with a Release of Construction Covenants upon completion of construction of the Developer Improvements which Release is required to be in such form as to permit it to be recorded in the Recorder’s Office of Los Angeles County. This Release is conclusive determination of satisfactory completion of the construction and development required by the DDA.

C. Authority has conclusively determined that such construction and development has been satisfactorily completed.

NOW, THEREFORE, Authority hereby certifies as follows:

1. The Developer Improvements to be constructed by Developer have been fully and satisfactorily completed in conformance with the DDA. All covenants relating to operating requirements, and use, maintenance and nondiscrimination covenants contained in the DDA shall remain in effect and enforceable according to their terms.

2. Nothing contained in this instrument shall modify in any other way any other provisions of the DDA.

RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

Pacific West Communities, Inc.
430 E. State Street, #100
Eagle, ID 83616
Attn: Caleb Roope
F-2
IN WITNESS WHEREOF,Authority has executed this Release
this day of __________________, 202 .

AUTHORITY:

LANCASTER HOUSING AUTHORITY, public
body corporate and politic
ATTEST:

By:

Its:

City Clerk
APPROVED AS TO FORM:

City Attorney
Attachment No. 1 to Exhibit F-3
ATTACHMENT NO. 1

SITE LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of Los Angeles, described as follows:

All of that parcel of land being the Southwest quarter of the Northeast quarter of Section 28, Township 7 North, Range 12 West, San Bernardino Base and Meridian, in the City of Lancaster, County of Los Angeles, State of California, according to the official plat of said land, except therefrom that portion lying easterly of the land described as Parcels, 1, 2 and 3 in the Deed to the State of California recorded June 27, 1968 as Instrument No. 417, Official Records of said County, said parcel of land also being described in the Certificate of Compliance recorded September 1, 1988 as Instrument No. 88-1395036, Official Records of said County.

EXCEPTING THEREFROM, that portion of land lying southerly of the following described line; BEGINNING at a point on the West line of said Northeast quarter of Section 28 distant North 0°24’01” West 547.17 from the Southwest corner thereof; thence, 1st - South 89°38’50” East 767.88 feet to the East line of said land, being also the West line of said Parcel 1 in the Deed to the State of California.

RESERVING therefrom an 18 foot wide (18') strip of land along the westerly line of said northeast quarter an easement for public road purposes, as described as beginning at the southwest corner of said southwest quarter of the northeast quarter section 28; thence North 0°17' 26" west along quarter section line, also being the easterly line of Tract No. 43627 filed in Book 1097, page 87 to 91 of Maps, Records of said County, 1055 feet; thence North 89°43' 34" East, 18 feet; thence South 0°17’26" East, 1055 feet to the southerly line of said southwest quarter; thence North 89°38'36" west, 18 feet more or less along said last mentioned southerly line to the point of beginning.

Except therefrom that portion in public roads of record.

A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

STATE OF CALIFORNIA )
) ss.

COUNTY OF )
On , before me, , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature of Notary Public

OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s)
Title Or Type Of Document
Number Of Pages
Date Of Documents
Partner(s) Limited General
Attorney-In-Fact
Trustee(s)
Guardian/Conservator
Other:

Signer is representing:

Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above
G-1

EXHIBIT G

RESIDENTIAL DECLARATION OF CONDITIONS, COVENANTS

AND RESTRICTIONS AND REGULATORY AGREEMENT

RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

Lancaster Housing Authority
44933 N. Fern Avenue
Lancaster, California 93534
Attention: Executive Director
This document is exempt from the payment of a
recording fee pursuant to Government Code Section
6103.

RESIDENTIAL DECLARATION OF CONDITIONS, COVENANTS

AND RESTRICTIONS AND REGULATORY AGREEMENT

THIS RESDIDENTIAL DECLARATION OF CONDITIONS, COVENANTS, AND RESTRICTIONS AND REGULATORY AGREEMENT (the “Declaration”) is made by PACIFIC WEST COMMUNITIES, INC., an Idaho general business corporation, (the “Covenanter”), as of this ___________ day of , 202 .

R E C I T A L S
A. As of the date hereof the Covenanter is the fee owner of record of that certain real property (the “Property”) located in the City of Lancaster, County of Los Angeles, State of California, legally described in Attachment No. 1. The Property is the subject of a Disposition and Development Agreement dated as of , 202 (the “Agreement”), entered into by and between the Lancaster Housing Authority (the “Covenantee”) and Covenanter, a copy of which is on file with the Covenantee as a public record. Pursuant to the Agreement, the Covenanter is required to execute this Declaration, which has been or shall be recorded among the official land records of the County of Los Angeles.

B. The Agreement provides for the execution and recordation of this document.

NOW, THEREFORE, THE COVENANTER HEREBY DECLARES AS FOLLOWS:

Capitalized terms used herein shall have the following set forth below:
“Affordability Period” is defined in Section 1(b) hereof. “Affordable Rents” shall have the meaning set forth in Health and Safety Code Section 50053, as in effect of the date hereof, as calculated for lower income households.

G-2
“Area Median Income” shall mean the area medium income for Los Angeles County, California, adjusted for household size, as determined pursuant to Health and Safety Code Section 50093.
“Certificate of Occupancy” shall mean the certificate issued by the official in the City’s Building Department with authority over such issuance subsequent to the approval of the Developer Improvements.
“Default” means the failure of a party to perform any action or covenant required by this Agreement within the time periods provided herein following thirty (30) days’ notice and opportunity to cure.
“Developer Improvements” means the Residential Units and all streets, driveways, walkways, open spaces, amenities and other improvements constructed on the Site in connection therewith.
“Gross Income” shall mean the gross income of a household or family calculated in accordance with Section 6914 of Title 25 of the California Code of Regulations. “Project” means the Residential Units and other Developer Improvements. “Property” means and refers to the Site.
“Qualified Resident” means a person or household whose Gross Income is equal to or less than the income limits specified in Section 1(a).
“Residential Units” shall mean the housing units to be constructed by the Developer on the Site pursuant and subject to the Agreement.
“Site” means the real property that is more particularly described in Attachment No. 1 attached hereto.

1. Affordable Housing. The Covenanter shall construct Residential Units on the Site.

All such Residential Units shall be designated for and occupied by Qualified Residents at Affordable Rents, as follows:
(a) Affordability Requirements. All the Residential Units will be designated for and occupied at Affordable Rents by lower income households as defined by California Health and Safety Code Section 50079.5.
(b) Duration of Affordability Requirements. During the entire term of the Affordability Period, Covenanter agrees to make available, restrict occupancy to, and rent the Residential Units to Qualified Residents at affordable rents as set forth in Section (a) above. In addition to any requirements of the Code, Covenanter agrees to comply with the provisions of Health and Safety Code Section 33413 through Section 33418 to the extent necessary to enable the Covenantee to count the units for purposes of meeting the requirements of Section 33413 of the Health and Safety Code.

The term “Affordability Period” means the period beginning upon the first day of the first full month following the date on which the first Residential Unit in the Project is occupied and ending on the last day of the 660th month thereafter.

G-3
(c) Annual Reports. Upon Covenantee’s request, Covenanter, at its expense, shall submit to the Covenantee the reports required pursuant to Health and Safety Code Section 33418, as the same may be amended from time to time, with each such report to be in the form prescribed by the Covenantee. Each annual report shall cover the immediately preceding fiscal year. (d) Long Term Management of the Property. The parties acknowledge that the Covenantee is interested in the long-term management and operation of the Property and in the qualifications of any person or entity retained by the Covenanter for that purpose (the “Property Manager”). The Covenantee may from time-to-time review and evaluate the identity and performance of the Property Manager of the Property and the Property Manager’s compliance with the provisions of this Declaration. If the Covenantee determines that the performance of the Property Manager is deficient based upon the standards and requirements set forth in this Declaration, the Covenantee shall provide notice to the Covenanter of such deficiencies and the Covenanter shall use its best efforts to correct such deficiencies. Upon Default of the terms of this Declaration by the Property Manager, the Covenantee shall have the right to require the Covenanter to immediately remove and replace the Property Manager with another property manager or property management company who is reasonably acceptable to the Covenantee, who may be related to or affiliated with the Covenanter, and who is experienced in managing multifamily residential developments.

2. Compliance with Declaration. Covenanter shall commence and complete the construction of the Property, and carry out the design, construction as evidenced by the issuance of the Certificate of Occupancy, and operation of the Project in compliance with all applicable laws, and in accordance with the Declaration.

3. Non-Discrimination Covenants. Covenanter by and for itself, its successors and assigns, and all persons claiming under or through them agrees that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Property, nor shall Covenanter 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, subleases, or vendees in the Property.

4. Maintenance of the Property. The Covenanter shall maintain or cause to be maintained the interiors and exteriors of the Property in a decent, safe and sanitary manner, in accordance with the standard of maintenance of similar housing units within the City, and in accordance with the maintenance standards which are set forth in the Declaration. None of the dwelling units on the Property shall at any time be utilized on a transient basis nor shall the Property or any portion thereof ever be used as a hotel, motel, dormitory, fraternity or sorority house, rooming house, hospital, nursing home, sanitarium or rest home. The Covenanter shall not convert the Property to condominium ownership without the prior written approval of the Covenantee, which approval the Covenantee may grant, withhold or deny in its sole and absolute discretion. If at any time Covenanter fails to maintain the Property in accordance with this Declaration and Covenantor fails to correct or commence to correct such condition within ten (10) days after written notice from the Covenantee (with a copy to the then existing lenders for the Project) with respect to graffiti, debris, waste material, and general maintenance, or thirty days after written notice from the Covenantee with respect to landscaping and building improvements, then the Covenantee, in addition to whatever remedy it may have at law or at equity, shall have the right to enter upon the applicable portion of the Property and perform all acts and work necessary to protect, maintain, and preserve the Developer Improvements and landscaped G-4
areas on the Property, and to attach a lien upon the Property, or to assess the Property, in the amount of the expenditures arising from such acts and work of protection, maintenance, and preservation by the Covenantee and/or costs of such cure, including a five percent 5% administrative charge, which amount shall be promptly paid by Covenanter to the Covenantee upon demand; provided, however, that such right to enter is subordinate to any existing or future mortgage or deed of trust.

Covenanter shall properly maintain the buildings, landscaping and yard areas on the Property, in accordance with the City’s Municipal Code and according to the following standards:
(a) No improperly maintained landscaping shall be visible from public rights of way, including:
(i) no lawns with grasses in excess of six (6) inches in height; (ii) no untrimmed hedges;
(iii) no trees, shrubbery, lawns, and other plant life dying from lack of water or other necessary maintenance;
(iv) no trees and shrubbery grown uncontrolled without proper pruning; (v) no vegetation so overgrown as to be likely to harbor rats or vermin; (vi) no dead, decayed or diseased trees, weeds and other vegetation. (b) No yard areas or balconies shall be left unmaintained, including:
(i) no broken or discarded furniture, appliances and other household equipment stored in yard areas for periods exceeding one (1) week; (ii) no packing boxes, lumber, trash, dirt and other debris stored in yards for periods exceeding one (l) week in areas visible from public property or neighboring properties;
(iii) no unscreened trash cans, bins or containers stored for unreasonable periods in areas visible from public property or neighboring properties; and (iv) no vehicles parked or stored in other than approved parking areas. (c) No buildings may be left in an unmaintained condition, including:
(i) no violations of state law, uniform codes, or City ordinances; (ii) no condition that constitutes an unsightly appearance that detracts from the aesthetics or property value of the subject property or constitutes a private or public nuisance;
(iii) no broken windows or chipped, cracked or peeling paint; and G-5
(iv) no conditions constituting hazards and/or inviting trespassers or malicious mischief

5. Conflict with Other Laws; Severability. In the event that any provision of this Declaration is found to be contrary to applicable law or any other provision of this Declaration, then the contrary provisions of this Declaration shall be deemed to mean those provisions which are enforceable and consistent with such laws and policies. The remaining portions of this Declaration shall be deemed modified in a manner which is consistent with the goals and intent of this Declaration to provide housing to lower income residents as set forth in this Declaration. Every provision of this Declaration is intended to be severable. In the event any term or provision of this Declaration is declared by a court of competent jurisdiction to be unlawful, invalid or unenforceable for any reason, such determination shall not affect the balance of the terms and provisions of this Declaration, which terms and provisions shall remain binding and enforceable.

6. Covenants For Benefit of Covenantee. All covenants without regard to technical classification or designation shall be binding for the benefit of the Covenantee and such covenants shall run in favor of the Covenantee for the entire period during the Affordability Period. The parties shall have the right to exercise all the rights and remedies and to maintain any actions at law or suits in equity or other proper legal proceedings to enforce and to cure such breach to which it or any other beneficiaries of these covenants may be entitled during the term specified for such covenants, except the covenants against discrimination which may be enforced at law or in equity at any time in perpetuity.

7. Notices, Demands and Communications. Written notices, demands and communications between the Covenanter and the Covenantee shall be sufficiently given if delivered by hand or dispatched by registered or certified mail, postage prepaid, return receipt requested, as follows:

Covenanter: Pacific West Communities, Inc.,
430 E. State Street, #100
Eagle, ID 83616
Attn: Caleb Roope
Covenantee: Lancaster Housing Authority
44933 N. Fern Avenue
Lancaster, CA 93534
Attention: Executive Director
Such addresses for notice may be changed from time to time upon notice to the other party.

Any written notice, demand or communication shall be deemed received immediately if delivered by hand and shall be deemed received on the fifth (5th) calendar day from the date it is postmarked if delivered by registered or certified mail.

8. Expiration Date. This Declaration shall automatically terminate and be of no further force or effect upon the expiration of the Affordability Period, except as otherwise provided in this Declaration.

9. Covenantee Remedies. The occurrence of any Default under this Declaration will, either at the option of the Covenantee or automatically where so specified, entitle the Covenantee to proceed with any and all remedies, including but not limited to the following:

G-6
(a) Specific Performance. The Covenantee shall have the right to mandamus or other suit, action or proceeding at law or in equity to require Covenanter to perform its obligations and covenants under this Declaration or to enjoin acts or things which may be unlawful or in violation of the provisions of this Declaration.
(b) Right to Cure at Covenanter’s Expense. The Covenantee shall have the right to cure any monetary default by Covenanter under a loan or grant; provided, however, that if the Covenanter is in good faith contesting a claim of default under a loan and the Covenantee’s interest under this Declaration is not imminently threatened by such default, the Covenantee shall not have the right to cure such default. The Covenanter agrees to reimburse the Covenantee for any funds advanced by the Covenantee to cure a monetary default by Covenanter upon demand therefore, together with interest thereon at the rate of ten percent (10%) per annum, from the date of expenditure until the date of reimbursement.

IN WITNESS WHEREOF, the Covenanter has caused this instrument to be executed on its behalf by its officers hereunto duly authorized as of the date set forth above.

COVENANTER:

PACIFIC WEST COMMUNITIES, INC., an Idaho
general business corporation
By:

Name:

Its:

ATTACHMENT NO. 1

SITE LEGAL DESCRIPTION
The land referred to herein is situated in the State of California, County of Los Angeles, described as follows:

All of that parcel of land being the Southwest quarter of the Northeast quarter of Section 28, Township 7 North, Range 12 West, San Bernardino Base and Meridian, in the City of Lancaster, County of Los Angeles, State of California, according to the official plat of said land, except therefrom that portion lying easterly of the land described as Parcels, 1, 2 and 3 in the Deed to the State of California recorded June 27, 1968 as Instrument No. 417, Official Records of said County, said parcel of land also being described in the Certificate of Compliance recorded September 1, 1988 as Instrument No. 88-1395036, Official Records of said County.

EXCEPTING THEREFROM, that portion of land lying southerly of the following described line; BEGINNING at a point on the West line of said Northeast quarter of Section 28 distant North 0°24’01” West 547.17 from the Southwest corner thereof; thence, 1st - South 89°38’50” East 767.88 feet to the East line of said land, being also the West line of said Parcel 1 in the Deed to the State of California.

RESERVING therefrom an 18 foot wide (18') strip of land along the westerly line of said northeast quarter an easement for public road purposes, as described as beginning at the southwest corner of said southwest quarter of the northeast quarter section 28; thence North 0°17' 26" west along quarter section line, also being the easterly line of Tract No. 43627 filed in Book 1097, page 87 to 91 of Maps, Records of said County, 1055 feet; thence North 89°43' 34" East, 18 feet; thence South 0°17’26" East, 1055 feet to the southerly line of said southwest quarter; thence North 89°38'36" west, 18 feet more or less along said last mentioned southerly line to the point of beginning.

Except therefrom that portion in public roads of record.

A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

STATE OF CALIFORNIA )
) ss.

COUNTY OF )
On , before me, , Notary Public,
(Print Name of Notary Public)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature of Notary Public

OPTIONAL
Though the data below is not required by law, it may prove valuable to persons relying on the document and could prevent fraudulent reattachment of this form.

CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s)
Title Or Type Of Document
Number Of Pages
Date Of Documents
Partner(s) Limited General
Attorney-In-Fact
Trustee(s)
Guardian/Conservator
Other:

Signer is representing:

Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above