Montebello City Council
February 22, 2023

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fees, and reasonable costs of environmental consultants and other experts, and all foreseeable damages or costs of any kind or of any nature whatsoever (collectively, “Environmental Claims”) that may, at any time, be imposed upon, incurred or suffered by, or claimed, asserted or awarded against, the Indemnified Parties, directly or indirectly relating to or arising from any of the following “Environmental Matters” occurring during or arising from the Developer’s ownership of the Agency Properties or construction or operation of the Project:

5.3.1The presence of Hazardous Substances on, in, under, from or affecting all or any portion of the Agency Properties or the Project the existence of which first arose following the Close of Escrow.

5.3.2The storage, holding, handling, release, threatened release, discharge, generation, leak, abatement, removal or transportation of any Hazardous Substances on, in, under, from or affecting the Agency Properties or the Project, except to the extent that such Hazardous Substances were present on the Agency Properties prior to the Closing Date.

5.3.3The violation of any law, rule, regulation, judgment, order, permit, license, agreement, covenant, restriction, requirement or the like by the Developer, its agents or contractors, relating to or governing in any way Hazardous Substances on, in, under, from or affecting the Agency Properties or the Project.

5.3.4The failure of the Developer, its agents or contractors, to properly complete, obtain, submit and/or file any and all notices, permits, licenses, authorizations, covenants and the like in connection with the Developer’s activities on the Agency Properties or regarding the Project.

5.3.5The implementation and enforcement by the Developer, its agents or contractors of any monitoring, notification or other precautionary measures that may, at any time, become necessary to protect against the release, potential release or discharge of Hazardous Substances on, in, under, from or affecting the Agency Properties or the Project the existence of which first arose following the Close of Escrow.

5.3.6The failure of the Developer, its agents or contractors, in compliance with all applicable Environmental Laws, to lawfully remove, contain, transport or dispose of any Hazardous Substances existing, stored or generated on, in, under or from the Agency Properties or the Project the existence of which first arose following the Close of Escrow.

5.3.7Any investigation, inquiry, order, hearing, action or other proceeding by or before any Governmental Agency in connection with any Hazardous Substances on, in, under, from or affecting the Agency Properties or the Project the existence of which first arose following the Close of Escrow or the Developer’s violation of any Environmental Law relating to the Agency Properties or the Project.

5.3.8The Developer shall pay to the Indemnified Parties all costs and expenses including, without limitation, reasonable attorneys’ fees and costs, incurred by the Indemnified Parties in connection with enforcement of the aforementioned environmental indemnity except to the extent that a court of competent jurisdiction or arbiter mutually selected by the Parties

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determines that Developer is not required to indemnify the Indemnified Parties with respect to the enforcement action in question.

5.4 Insurance. In order to protect the City and its commissions, agents, attorneys, officers, employees and authorized representatives (collectively, “Additional Insureds”) against any and all claims and liability for death, injury, loss and damage resulting from the Developer’s actions in connection with this Agreement, the Agency Properties, and the Project, the Developer shall secure and maintain the insurance coverage, described in and required by this Section 5.4.

The Sellers shall not have any obligation under this Agreement until the Developer provides the required policies and/or certificates evidencing the insurance required by this Section 5.4 to the City and the City approves such evidence of insurance. The Developer shall pay any deductibles and self-insured retentions under all insurance policies issued in satisfaction of the terms of this Agreement. Developer shall retain all insurance policies as set forth in this Section 5.4 until recordation of the Certificate of Completion.

5.4.1 Workers’ Compensation Insurance Requirement. The Developer shall submit written proof that the Developer is insured against liability for workers’ compensation in accordance with the provisions of Section 3700 of the Labor Code. By executing this Agreement, the Developer makes the following certification, required by Section 1861 of the Labor Code:
“I am aware of the provisions of section 3700 of the Labor Code which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of that code, and I will comply with such provisions before commencing the performance of the work of the Agreement.” The Developer shall require each contractor and sub-contractor performing work on the Project to provide workers’ compensation coverage for all of such contractor’s or sub- contractor’s employees, unless the contractor’s or sub-contractor’s employees are covered by workers’ compensation insurance provided by the Developer. If any class of employees engaged in work or services performed in connection with the Project is not covered by Labor Code Section 3700, the Developer shall provide and/or require each contractor or sub-contractor to provide adequate workers’ compensation insurance covering such employees. Each workers’ compensation policy procured pursuant to this Section 5.4.1 shall contain a full waiver of subrogation clause in favor of the Additional Insureds.

5.4.2 Liability and Permanent Insurance Requirements.

5.4.2.1The Developer shall maintain in full force and effect, from the Effective Date until the issuance of the Certificate of Completion, subject to Section 5.4.2.4, the following insurance coverage:

5.4.2.1.1Commercial General Liability Insurance coverage, including, but not limited to, Premises-Operations, Contractual Liability Insurance (specifically covering all indemnity obligations of the Developer pursuant to this Agreement), Products- Completed Operations Hazards, Personal Injury (including bodily injury and death), and Property Damage for liability arising out of the construction of the Project and/or the Developer’s operations

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concerning the Agency Properties or the Project. The commercial general liability insurance coverage shall have minimum limits for Bodily Injury and Property Damage liability of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate.

5.4.2.1.2Automobile Liability Insurance against claims of Personal Injury (including bodily injury and death) and Property Damage covering all owned, leased, hired and non-owned vehicles used by the Developer with minimum limits for Bodily Injury and Property Damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and ONE MILLION DOLLARS ($1,000,000) aggregate. Such insurance shall be provided by a business or commercial vehicle policy.

5.4.2.1.3If the Developer hires a consultant to provide design services, such as architectural or engineering services in connection with the Project, or any portion of the Project, the Developer shall require each such consultant to provide Professional Liability (Errors and Omissions) Insurance, for liability arising out of, or in connection with, the performance of such design services, with limits of not less than ONE MILLION DOLLARS ($1,000,000).

5.4.2.1.4Upon acceptance of the Project or any portion thereof, from each contractor, the Developer shall maintain Fire and Extended Coverage Insurance, excluding earthquake coverage, on the Project on a blanket basis or with an agreed amount clause in amounts not less than 100% of the replacement value of all portions of the Project so accepted.

5.4.2.2During the construction of the Project, the Developer shall require that each contractor performing work on the Project maintain the following insurance coverage, as specified below, at all times during the performance of said work, or the Developer shall provide for such contractors “wrap” coverage, as specified below, at all times during the performance of said work:

5.4.2.2.1The Developer shall maintain Builder’s Risk Insurance to be written on an All Risk Completed Value form, in an aggregate amount equal to 100% of the completed insurable value of the Project or portion of the Project on which such contractor is performing work.

5.4.2.2.2Each general contractor and each sub-contractor shall maintain Commercial General Liability Insurance with limits of not less than ONE MILLION DOLLARS ($1,000,000) per occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate to protect the Developer during the construction of the Project from claims involving bodily injury and/or death and damage to the property of others.

5.4.2.2.3Each general contractor and each sub-contractor shall maintain Automobile Liability Insurance against claims of personal injury (including bodily injury and death) and property damage covering all owned, leased, hired and non-owned vehicles used in the performance of the contractor’s obligations with minimum limits for bodily injury and property damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO

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MILLION DOLLARS ($2,000,000) aggregate. Such automobile liability insurance shall be provided by a business or commercial vehicle policy.

5.4.2.3The insurance required in Section 5.4.2.1 and Section 5.4.2.2 above shall include endorsements naming the Additional Insureds as additional insured for liability arising out of this Agreement and any operation related to this Agreement.

5.4.2.4Any insurance coverage required under this Agreement shall not be written on a “claims made” basis. The applicable certificate of insurance must clearly provide that the coverage is on an “occurrence” basis. The requirements of this Section 5.4.2.4 shall survive any expiration or termination of this Agreement and the recordation of the Grant Deed and any Certificate of Completion.

5.4.2.5Receipt by the City of evidence of insurance that does not comply with the above requirements shall not constitute a waiver of the insurance requirements of this Agreement.

5.4.2.6Subject to Section 5.4.2.4, all of the insurance coverage required under this Section 5.4 shall be maintained by the Developer or its contractors, as required by the terms of this Agreement, until the issuance of the Certificate of Completion and shall not be reduced, modified, or canceled without, at least, thirty (30) days prior written notice to the City.

Also, phrases such as “endeavor to” and “but failure to mail such notice shall impose no obligation or liability of any kind upon the company” shall not be included in the cancellation wording of any certificates of insurance or any coverage for the Additional Insureds. The Developer shall immediately obtain replacement coverage for any insurance policy that is terminated, canceled, non-renewed, or whose policy limits are exhausted or upon insolvency of the insurer that issued the policy.

5.4.2.7All insurance to be obtained and maintained by the Developer under this Section 5.4 shall be issued by a company or companies listed in the then current “Best’s Key Rating Guide” publication with a minimum of an “A:VII” rating and be admitted to conduct business in the State of California by the State of California Department of Insurance.

5.4.2.8The City will not accept self-insurance in satisfaction of the insurance requirements of this Section 5.4.

5.4.2.9All insurance obtained and maintained by the Developer in satisfaction of the requirements of this Agreement shall be primary to and not contributing to any insurance maintained by the Additional Insureds.

5.4.2.10Insurance coverage in the minimum amounts set forth in this Section

5.4 shall not be construed to relieve the Developer of any liability, whether within, outside, or in excess of such coverage, and regardless of solvency or insolvency of the insurer that issues the coverage; nor shall it preclude the Additional Insureds from taking such other actions as are available to them under any other provision of this Agreement or otherwise at law.

5.4.3Failure by the Developer to maintain all insurance coverage required by this Section 5.4 in effect following written notice to Developer and Developer’s failure to procure

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following a fifteen (15) day cure period shall be an Event of Default by the Developer. The City, at its sole option, may exercise any remedy available to them in connection with such an Event of Default. Alternatively, the City may, at its sole option, purchase any such required insurance coverage and the City shall be entitled to immediate payment from the Developer for any premiums and associated costs paid by the City for such insurance coverage. Any election by the City to purchase or not to purchase insurance otherwise required to be carried by the Developer shall not relieve the Developer of its obligation to obtain and maintain the insurance coverage required by this Agreement.

5.5 Developer Covenant to Defend this Agreement. The Developer acknowledges that the Sellers are each a “public entity” and/or “public agency” as defined under applicable California law. Therefore, the Sellers must satisfy the requirements of certain California statutes relating to the actions of public entities and public agencies including, without limitation, CEQA.

Also, as a public body, the Sellers’s action in approving this Agreement may be subject to proceedings to invalidate this Agreement or mandamus. The Developer assumes the risk of delays and damages that may result to the Developer from any third-party legal actions related to the Sellers’s approval of this Agreement or the pursuit of the activities contemplated by this Agreement, even in the event that an error or omission by the Sellers is determined to have occurred. If a third-party files a legal action regarding the Sellers’s approval of this Agreement or the pursuit of the activities contemplated by this Agreement, either Developer or the Sellers may terminate this Agreement on thirty (30) days written notice to the other Parties of the intent to terminate this Agreement, referencing this Section 5.5, without any further obligation to perform the terms of this Agreement and without any liability to the other Parties resulting from such termination, unless the Developer unconditionally agrees to indemnify and defend the Sellers, with legal counsel selected by Developer and reasonably acceptable to the Sellers, against such third- party legal action, as provided in the next sentence. Within thirty (30) days of receipt of the Sellers’s notice of intent to terminate this Agreement, as provided in the preceding sentence, the Developer may offer to defend the Sellers, with legal counsel reasonably acceptable to Sellers, in the third-party legal action and pay all of the court costs, attorney fees, monetary awards, sanctions, attorney fee awards, expert witness and consulting fees, and the expenses of any and all financial or performance obligations resulting from the disposition of the legal action. Any such offer from the Developer must be in writing and reasonably acceptable to the Sellers in both form and substance. Nothing contained in this Section 5.5 shall be deemed or construed to be an express or implied admission that the Sellers are liable to the Developer or any other person or entity for damages alleged from any alleged or established failure of the Sellers to comply with any statute, including, without limitation, CEQA. The Developer’s defense of such third-party actions as described in this Section 5.5 shall constitute an Unavoidable Delay. Notwithstanding anything to the contrary in this Agreement, including in this Section 5.5, Developer does not assume the risk, and shall not be responsible for, damages, including any fines or penalties assessed or charged to City and/or Successor Agency, pursuant to the Surplus Land Act (Government Code section 54220 et seq) or pursuant to redevelopment dissolution laws (Health and Safety Code section 34170 et seq.).

5.6 Affordability Covenant. The Developer for itself, its successors and assigns agrees that sixty-two (62) of the units created by the Project shall be restricted for affordable housing purposes for a period of time not less than fifty-five (55) years, earning between thirty percent (30%) and sixty percent (60%) of median income, and subject to the specific terms and

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conditions set forth in the Regulatory Agreement that shall be recorded on the Project Site and run with the land for the term thereof.

ARTICLE VI.

PROJECT FINANCING

6.1 City Loans.

6.1.1 Land Note and Security. The City shall make a loan to Developer in the amount of the City Purchase Price (“Land Loan”), which shall be paid by Developer to City on the terms and conditions set forth in the Land Note substantially in the form attached hereto as Exhibit “K” (“Land Note”), and which shall be secured by the Project Site by way of the City Loan Deed of Trust substantially in the form attached hereto as Exhibit “M” hereto (“City Loan Deed of Trust”).

6.1.2 Impact Fee Note and Security. The City shall make a loan to Developer in the amount of NINE HUNDRED AND FIFTY THOUSAND DOLLARS ($950,000.00) (“Impact Fee Loan”) in the form of a deferment of the development impact fees due by Developer to the City in connection with the Project, which shall be paid by Developer to City on the terms and conditions set forth in the Impact Fee Note substantially in the form attached hereto as Exhibit “L” (“Impact Fee Note”), and which shall be secured by the Project Site by way of the City Loan Deed of Trust.

6.1.3 Predevelopment Loan. Conditioned upon the Closing and the issuance of the Project Permits to Developer, the City shall make a loan to Developer in the amount of FIVE HUNDRED AND FORTY NINE THOUSAND DOLLARS ($ 549,000.00) (“Predevelopment Loan”), which principal amount shall accrue interest at the rate of three percent (3%) and have a maturity date that is fifty-fifty (55) years from the date on which the Construction Financing converts to the Permanent Loan. The City shall make the Predevelopment Loan to Developer no later than January 31, 2024, and as a condition to the loan and receipt of the proceeds Developer shall execute a promissory note in favor of City that is substantially in the form and includes the same general terms and conditions as the Impact Fee Note, and which shall be secured on the Project Site by way of a deed of trust that is substantially in the form and includes the same general terms and conditions as the City Loan Deed of Trust.

6.1.4 Limited-Recourse. Neither the Developer nor its partners shall have any direct or indirect personal liability for payment of the principal of, or interest on, the Land Note, Impact Fee Note, or Predevelopment Loan Note, or the performance of the covenants of the Developer under the City Loan Deed of Trust or Predevelopment Loan Deed of Trust. The sole recourse of the City with respect to the principal of, or interest on, the Land Note, Impact Fee Note, and/or Predevelopment Loan Note, and defaults by Developer in the performance of its covenants under the City Loan Deed of Trust and Predevelopment Loan Deed of Trust shall be to the Project Site, as described in each of the City Loan Deed of Trust and Predevelopment Loan Deed of Trust.

6.2 Construction Financing. Developer shall finance the development and construction of the Project in accordance with the Project Budget. Further, City and Developer

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agree that the financing of the Project shall comply with all of the following (the “Construction Financing”):

6.2.1 Tax Credit Financing. Prior to the Effective Date, Developer has applied for and been awarded an allocation of Tax Credits in an amount set forth in the Project Budget to finance a portion of the Project Costs.

6.2.2 LADCDA AHTF Loan. Prior to the Effective Date, Developer has applied for and been awarded a loan from the Los Angeles County Development Authority (“LADCDA”) from Affordable Housing Trust Funds in an amount set forth in the Project Budget to finance a portion of the Project Costs (“LADCDA AHTF Loan”), and which will be secured by the Project Site by way of a deed of trust in a form reasonably acceptable to the City (“LACDA AHTF Deed of Trust”). As a condition of LADCDA providing the LACDA AHTF Loan, Developer will execute and record at the Close of Escrow a regulatory agreement in favor of LADCDA imposing affordability requirements on the Project (the “LADCA AHTF Regulatory Agreement”).

6.2.3 Sponsor Loan. Prior to the Effective Date, Vista Del Monte applied for and was awarded a grant from the California Department of Housing and Community Development (“HCD”) Infill Infrastructure Grant Program in an amount set forth in the Project Budget to finance a portion of the Project Costs, which grant funds are being loaned by Vista Del Monte to Developer as a sponsor loan (“Sponsor Loan”), and which will be secured by the Project Site by way of a deed of trust in a form reasonably acceptable to the City (“Sponsor Loan Deed of Trust”). As a condition of HCD providing the grant, Developer will execute and record at the Close of Escrow a regulatory agreement in favor of HCD imposing affordability requirements on the Project (the “HCD IIG Regulatory Agreement”)

6.2.4 SGVRHT Loan. Prior to the Effective Date, Developer has applied for and been awarded a loan from the San Gabriel Valley Regional Hospital in an amount set forth in the Project Budget to finance a portion of the Project Costs (“SGVRHT Loan”), and which will be secured by the Project Site by way of a deed of trust in a form reasonably acceptable to the City (“SGVRHT Deed of Trust”). As a condition to SGVRHT providing the SGVRHT Loan, Developer will execute and record at the Close of Escrow a regulatory agreement in favor of SGVRHT imposing affordability requirements on the Project (the “SGVRHT Regulatory Agreement”).

6.2.5 City National Bank Construction Loan. Developer has obtained a commitment for a construction loan from City National Bank in the approximate amount of Twenty-Seven Million Five Hundred Thousand Dollars ($27,500,000.00).

6.2.6 Terms of Construction Financing. Prior to the Close of Escrow, Developer shall provide for the City’s review and approval, which shall not be unreasonably withheld, conditioned or delayed, the terms of the Construction Financing, and shall provide the City the opportunity to review such terms with the lender providing such Construction Financing.

6.3 Project Budget. While the Project Budget has been prepared based on the best, good faith estimate of Developer of the costs which are likely to be incurred for the Project, the Parties recognize that events and circumstances not currently contemplated, some of which are

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outside of the control of the Parties, could result in changes in the Project Costs, necessitating changes in the Project Budget. To the extent that Developer is required to make changes to the Project Budget, Developer shall promptly submit a revised Project Budget to the City Manager for review and approval, which review and approval shall not be unreasonably withheld, conditioned or delayed, as to the consistency of the financing secured with Developer’s obligations under this Agreement, and the sufficiency of the financing secured by Developer to meet the revised Project Costs.

6.4 Only Permitted Exceptions. Developer shall not record and shall not allow to be recorded against the Project Site any Security Instrument, lien or other encumbrance that is not a Permitted Exception. Developer shall remove or cause to be removed (or providing title insurance in form and substance reasonably acceptable to the Sellers and issued by a title insurance company reasonably acceptable to the Sellers, insuring the priority of the Regulatory Agreement and the Deeds of Trust as superior to such lien, with such title insurance being in the minimum amount of the outstanding principal and interest under the Notes plus 125% of the amount of the lien claim or providing a statutory bond resulting in removal of such lien) any non-Permitted Exception made or recorded against the Project Site or shall assure the complete satisfaction of any such non- Permitted Exception to the satisfaction of the City, in the City’s sole and absolute discretion. The covenants of Developer set forth in this Section regarding the placement of encumbrances on the Project Site shall run with the land and bind successive owners thereof until issuance of a Certificate of Completion for the Project.

6.5 City Right to Discharge Prohibited Encumbrances. After sixty (60) calendar days’ Notice to Developer of a non-Permitted Exception and provided that Developer has not caused such non-Permitted Exception to be removed, the City shall have the right, but not the obligation, to satisfy or remove any non-Permitted Exception and receive reimbursement from Developer for any amounts paid or incurred in satisfying or removing any such non-Permitted Exception, upon demand. Any amount expended by the City to discharge a non-Permitted Exception that is not reimbursed to the City by Developer within thirty (30) calendar days following written demand for payment from the City shall accrue interest at an annual rate equal to the lesser of eight percent (8%) per annum or the maximum highest rate of interest allowed by law under the circumstances, until paid in full. Nothing in this Section 6.5, though, shall require Developer to pay or make provisions for the payment of any tax, assessment, lien or charge that Developer is in the process of contesting the validity or amount thereof, in good faith, and so long as such contest shall not subject all or any portion of the Project Site to forfeiture or sale.

6.6 Rights of Lender and City Regarding Permitted Security Instruments.

6.6.1 Notice of Liens. With the exception of Security Instruments listed in Section 3.7 or the Project Budget, the Developer shall promptly notify the City of any Security Instrument or lien asserted against or attached to all or any portion of the Project Site prior to the date of issuance of a Certificate of Completion for the Project, whether by voluntary act of Developer or otherwise.

6.6.2 Notice of Default to Lenders. Whenever the City delivers any notice of default to Developer under this Agreement, the City shall send a copy of such notice of default to each Lender holding a Permitted Security Instrument of which the City has received notice and a

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contact address for transmittal of such notices. Each Lender receiving a copy of any such notice of default shall have the right, at its option, to commence the cure or remedy of any default of Developer set forth in such notice and to diligently and continuously proceed with such cure or remedy such default within the cure period allowed to Developer under this Agreement plus an additional sixty (60) days, and to thereafter proceed with completion of the Project in accordance with the Schedule of Performance. The City shall accept such performance by a Lender with the same force and effect as if furnished by Developer. If such default can only be remedied or cured by the Lender upon obtaining possession of the Project Site, the City shall allow the Lender a reasonable opportunity to obtain possession with diligence and exigency through exercise of remedies under such Lender’s Permitted Security Instrument and to remedy or cure such default within ninety (90) days after obtaining possession of the Project Site. If the default reasonably requires more than ninety (90) days to cure, however, then the time available to a Lender to cure pursuant to this Section 6.6 shall be the reasonable time required to complete such cure, as long as the Lender has commenced the cure of the default within such ninety (90) day period after obtaining possession of the Project Site and diligently pursues the cure to completion. During such extension of time, the City shall not terminate this Agreement or exercise other remedies under this Agreement by reason of such default. In addition, any Lender properly completing the Project with the consent of the City shall be entitled, upon written request made to the City, to a Certificate of Completion from the City. Any Lender desiring to complete the Project must provide the City with evidence reasonably satisfactory to the City that the Lender has the qualifications (or will engage one or more licensed contractor(s) or consultant(s) with such qualifications) and financial capability necessary to perform such obligations.

6.6.3 No Termination of Permitted Security Instruments by Default. An Event of Default by Developer under this Agreement shall not defeat or render invalid the lien of any Permitted Security Instrument made in good faith and for value as to all or any part of the Project Site, whether or not the Lender is subordinated to this Agreement; but unless otherwise provided in this Agreement, this Agreement shall be binding and effective against any owner of the Project Site, including those whose title thereto is acquired pursuant to exercise of remedies under a Permitted Security Instrument or from a person or entity exercising any such remedies.

6.6.4 Lender Rights on Termination or Modification. No termination of this Agreement shall be binding upon a Lender unless the termination occurs after notice to such Lender and such Lender’s failure to cure all then existing defaults under this Agreement pursuant to this Section 6.6, or with such Lender’s prior written consent. No modification of this Agreement that affects the rights of a Lender in any respect shall be binding upon the Lender without its prior written consent.

6.6.5 No Construction Obligation of Lender. A Lender shall in no way be obligated by the provisions of this Agreement to construct or complete the development of the Project or to guarantee such construction or completion, but may do so pursuant to and in accordance with this Section 6.6. Nothing in this Agreement shall be deemed to construe, permit, or authorize any Lender to devote all or any portion of the Project Site to any uses, or to construct any improvements thereon, other than those uses or the Project provided for or authorized by this Agreement.

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6.6.6 City Right to Cure Obligations. In the event of a default by Developer under any Permitted Security Instrument, where the Lender has not exercised its option to complete the Project under Section 6.6.2, the City may cure the default of Developer under the applicable Permitted Security Instrument, but is under no obligation to do so, prior to completion of any sale or foreclosure of all or any portion of the Project Site under the applicable Permitted Security Instrument. The City shall be entitled to reimbursement from Developer of all costs and reasonable expenses incurred by the City in curing any default of Developer under any Permitted Security Instrument, under demand. Any amount expended by the City to cure a default of Developer under any Permitted Security Instrument that is not reimbursed to the City, by Developer within thirty (30) calendar days after notice of such amount to Developer, shall accrue interest at an annual rate equal to the lesser of eight percent (8%) per annum or the maximum highest rate of interest allowed by law under the circumstances until paid in full. City’s rights to cure under this Section shall remain in effect until Developer has repaid the Land Note and the Impact Fee Note in full.

6.6.7 Foreclosure of Permitted Security Instrument. Foreclosure of any Permitted Security Instrument, whether by judicial proceedings or by power of sale, or any conveyance by deed in lieu of foreclosure, shall not require the consent of the City or constitute a default under this Agreement.

6.6.8 Subordination. The City Loan Deed of Trust and Predevelopment Loan Deed of Trust shall be subordinated to loans from Institutional Lenders, including the Construction Financing, the Permanent Loan, and any Refinancing of the foregoing (in each case, a “Senior Loan”), provided all of the proceeds of the proposed Senior Loan, less any transaction costs, are used to finance development of the Project, and provided the proceeds of any Refinancing, less any transaction costs, any amounts used to pay for Project repairs or capital improvements, any amounts required to be paid towards a Senior Loan, and any amounts required to be deposited into reserve accounts, are used to repay and redeem preexisting Senior Loan(s). Each of this Agreement and the Regulatory Agreement shall be subordinated to any Senior Loan that satisfies the criteria in the preceding sentence. The Predevelopment Loan Deed of Trust (but not the City Loan Deed of Trust) shall be subordinated to the lien(s) securing the LACDA AHTF Loan and the SGVRHT Loan, and each of the Predevelopment Loan Deed of Trust and City Loan Deed of Trust shall be subordinated to the LACDA AHTF Regulatory Agreement and the SGVRHT Regulatory Agreement. The City Manager or his/her designee on behalf of the City is authorized to execute subordination agreements in forms reasonably acceptable to the City Attorney that provide for the subordinations described above without the necessity of any further action or approval by the City Council.

ARTICLE VII.

DEFAULTS, REMEDIES AND TERMINATION

7.1 Defaults - General.

7.1.1Subject to any extensions of time provided for in this Agreement, failure or delay by any Party to perform any term or provision of this Agreement shall constitute an “Event of Default” under this Agreement; provided, however, that if a Party otherwise in default commences to cure, correct or remedy such default, within thirty (30) calendar days after receipt of written notice from the injured Party specifying such default, and shall diligently and

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continuously prosecute without interruption such cure, correction or remedy to completion (and where any time limits for the completion of such cure, correction or remedy are specifically set forth in this Agreement, then within said time limits), such Party shall not be deemed to be in default under this Agreement and no Event of Default shall be deemed to have occurred.

7.1.2The injured Party shall give written notice of default to the Party in default, specifying the default complained of by the non-defaulting Party. Delay in giving such notice shall not constitute a waiver of any default nor shall it change the time of default.

7.1.3Any failure or delays by any Party in asserting any of their rights and/or remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies. Delays by any Party in asserting any of its rights and/or remedies shall not deprive that Party of its right to institute and maintain any actions or proceedings that it is reasonably necessary to protect, assert or enforce any such rights or remedies.

7.1.4In addition to other acts or omissions of the Developer that may legally or equitably constitute a default or breach of this Agreement, the occurrence of any of the following specific events, prior to the issuance of a Certificate of Completion for the Project, shall constitute an “Event of Default” under this Agreement and shall not be subject to the notice and cure provisions of Section 7.1.1:

7.1.4.1Any material default by the Developer under any Security Financing Instrument for any purpose or reason that remains uncured following any applicable notice and expiration of any applicable cure period under such Security Financing Instrument.

7.1.4.2Any representation, warranty or disclosure made to the Sellers by the Developer regarding this Agreement or the Project is known by the Developers to be materially false or materially misleading, whether or not such representation or disclosure appears in this Agreement.

7.1.4.3There occurs any event of dissolution, reorganization or termination of the Developer that adversely and materially affects the operation or value of the Project Site or the Project, and such event is not corrected within five (5) business days following written notice of such event from the Sellers to the Developer.

7.1.4.4The Developer Transfers its interest in this Agreement, the Project Site, or the Project, or any portion thereof, whether voluntarily or involuntarily or by operation of law, in violation of the terms and conditions of this Agreement and such action is not cured within the period prescribed in Section 8.2.2.

7.1.4.5The Developer becomes insolvent or a receiver is appointed to conduct the affairs of the Developer under state or federal law.

7.1.4.6The Developer’s legal entity status authorized by the Secretary of State of the State of California to transact business in California is suspended or terminated and is not promptly reinstated.

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7.2 DEVELOPER’S ELECTION RE: SPECIFIC ENFORCEMENT OF

AGREEMENT OR WAIVER OF RIGHT TO SPECIFIC PERFORMANCE AND LIMITATION ON RECOVERY OF DAMAGES PRIOR TO CLOSE OF ESCROW. UPON

THE OCCURRENCE OF AN EVENT OF DEFAULT PERTAINING TO THE CONVEYANCE

OF THE AGENCY PROPERTIES OR ANY PORTION THEREOF BY THE SELLERS UNDER

THIS AGREEMENT PRIOR TO CLOSE OF ESCROW, THE DEVELOPER SHALL, AS ITS

SOLE AND EXCLUSIVE REMEDY, HAVE THE RIGHT TO EXERCISE ONE OF THE ALTERNATIVE REMEDIES DESCRIBED IN SECTIONS 7.2.1 AND 7.2.2. THE DEVELOPER’S ELECTION, ONCE MADE, SHALL BE IRREVOCABLE.

7.2.1 WAIVER OF RIGHT TO SPECIFIC PERFORMANCE AND
LIMITATION ON RECOVERY OF DAMAGES. THE DEVELOPER MAY WAIVE THE REMEDIES SET FORTH IN SECTION 7.2.2 AND MAY CANCEL THE ESCROW PURSUANT TO SECTION 3.10, AND UPON CANCELLATION OF THE ESCROW, THE

DEVELOPER SHALL BE RELIEVED OF ANY OBLIGATION UNDER THIS AGREEMENT

TO PURCHASE OR ACCEPT TITLE TO THE AGENCY PROPERTIES AND ANY SUCH

ESCROW CANCELLATION SHALL BE WITHOUT ANY LIABILITY OF THE DEVELOPER TO THE SELLERS OR ANY OTHER PERSON ARISING FROM SUCH ACTIONS. THE

DEVELOPER SHALL BE LIMITED TO RECOVERING ANY AMOUNTS ACTUALLY

EXPENDED BY THE DEVELOPER IN REASONABLE RELIANCE ON THIS AGREEMENT

PRIOR TO THE DATE OF THE OCCURRENCE OF THE EVENT OF DEFAULT BY THE

SELLERS NOT TO EXCEED AN AGGREGATE TOTAL OF TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000.00). THE DEVELOPER WAIVES ANY RIGHT TO

RECOVER ANY OTHER SUMS FROM THE SELLERS ARISING FROM AN EVENT OF DEFAULT BY THE SELLERS PRIOR TO THE CLOSE OF ESCROW. THE DEVELOPER

SHALL NOT BE ENTITLED TO, AND HEREBY WAIVES, ANY RIGHT TO RECOVER ANY

OTHER SUMS FROM THE SELLERS ARISING FROM AN EVENT OF DEFAULT BY THE SELLERS PRIOR TO THE CLOSE OF ESCROW. THE DEVELOPER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 7.2.1, WHICH CIVIL CODE SECTION READS AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH

THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR

SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF

EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR

HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.”

BY INITIALING BELOW, THE DEVELOPER KNOWINGLY AND
VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS AND RELEASES OF THIS SECTION 7.2.1.

DEVELOPER’S INITIALS ______________________
IN CONNECTION WITH THE WAIVERS OF THIS SECTION 7.2.1, THE

DEVELOPER FURTHER WAIVES THE RIGHT TO RECORD A NOTICE OF PENDENCY

46 1603\46\2864071.5

OF ACTION AGAINST ALL OR ANY PORTION OF THE AGENCY PROPERTIES EXCEPT

DEVELOPER MAY RECORD SUCH A NOTICE IN CONNECTION WITH ANY SUIT FOR

SPECIFIC PERFORMANCE PERMITTED HEREUNDER IN THE EVENT DEVELOPER

ELECTS NOT TO WAIVE ITS RIGHT TO SEEK SPECIFIC PERFORMANCE UNDER SECTION 7.2.2.

7.2.2 SPECIFIC PERFORMANCE. THE DEVELOPER MAY WAIVE THE REMEDIES SET FORTH IN SECTION 7.2.1 AND, IN ACCORDANCE WITH CIVIL CODE SECTION 3384, ET SEQ., INSTITUTE AN ACTION AGAINST THE SELLERS FOR

SPECIFIC PERFORMANCE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT

WHICH WERE TO HAVE BEEN COMPLETED BY THE SELLERS PRIOR TO THE CLOSE OF ESCROW.

7.3 SELLERS’ ELECTION RE: SPECIFIC ENFORCEMENT OF

AGREEMENT OR WAIVER OF RIGHT TO SPECIFIC PERFORMANCE AND LIMITATION ON RECOVERY OF DAMAGES PRIOR TO CLOSE OF ESCROW. UPON THE OCCURRENCE OF AN EVENT OF DEFAULT PERTAINING TO DEVELOPER’S

FAILURE TO CLOSE ESCROW AND ACQUIRE THE AGENCY PROPERTIES FROM THE

SELLERS UNDER THIS AGREEMENT, THE SELLERS SHALL, AS THEIR SOLE AND

EXCLUSIVE REMEDY, HAVE THE RIGHT TO EXERCISE ONE OF THE ALTERNATIVE REMEDIES DESCRIBED IN SECTIONS 7.3.1 AND 7.3.2. THE SELLER’S ELECTION, ONCE MADE, SHALL BE IRREVOCABLE.

7.3.1 WAIVER OF RIGHT TO SPECIFIC PERFORMANCE AND
LIMITATION ON RECOVERY OF DAMAGES. THE SELLERS MAY WAIVE THE REMEDIES SET FORTH IN SECTION 7.3.2 AND MAY CANCEL THE ESCROW PURSUANT TO SECTION 3.10, AND UPON CANCELLATION OF THE ESCROW, THE

SELLERS SHALL BE RELIEVED OF ANY OBLIGATION UNDER THIS AGREEMENT TO

SELL THE AGENCY PROPERTIES AND CONTRIBUTE FUNDS TO CONSTRUCTION OF

THE PROJECT, AND ANY SUCH ESCROW CANCELLATION SHALL BE WITHOUT ANY

LIABILITY OF THE SELLERS TO DEVELOPER OR ANY OTHER PERSON ARISING FROM SUCH ACTIONS. THE SELLERS SHALL BE LIMITED TO RECOVERING ANY

AMOUNTS ACTUALLY EXPENDED BY THE SELLERS IN REASONABLE RELIANCE ON

THIS AGREEMENT PRIOR TO THE DATE OF THE OCCURRENCE OF THE EVENT OF

DEFAULT BY THE DEVELOPER, NOT TO EXCEED AN AGGREGATE TOTAL OF TWO HUNDRED FIFTY THOUSAND DOLLARS ($250,000.00). THE SELLERS WAIVE ANY

RIGHT TO RECOVER ANY OTHER SUMS FROM THE DEVELOPER ARISING FROM AN EVENT OF DEFAULT BY THE DEVELOPER PRIOR TO THE CLOSE OF ESCROW. THE SELLERS ACKNOWLEDGE THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 7.3.1, WHICH CIVIL CODE SECTION READS AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS

THAT THE CREDITOR OR RELEASING PARTY DOES NOT

KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT

THE TIME OF EXECUTING THE RELEASE AND THAT, IF

KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY

47 1603\46\2864071.5

AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR
OR RELEASED PARTY.”

BY INITIALING BELOW, THE SELLERS KNOWINGLY AND

VOLUNTARILY WAIVE THE PROVISIONS OF
SECTION 1542 SOLELY IN CONNECTION WITH THE
WAIVERS AND RELEASES OF THIS SECTION 7.3.1.

CITY’S INITIALS ____________
SUCCESSOR AGENCY’S INITIALS ____________

7.3.2 SPECIFIC PERFORMANCE. THE SELLERS MAY WAIVE THE
REMEDIES SET FORTH IN SECTION 7.3.1 AND, IN ACCORDANCE WITH CIVIL CODE SECTION 3384, ET SEQ., INSTITUTE AN ACTION AGAINST THE DEVELOPER FOR

SPECIFIC PERFORMANCE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT

WHICH WERE TO HAVE BEEN COMPLETED BY THE DEVELOPER PRIOR TO THE CLOSE OF ESCROW.

7.4 Legal Actions.

7.4.1Except as otherwise provided by Section 7.2 and/or Section 7.3, any Party may institute legal action to cure, correct or remedy any default, to recover damages for any default, or to obtain any other remedy available to that Party under this Agreement or at law or in equity. Such legal actions must be instituted in the Superior Court of the State of California in and for the County of Los Angeles, California, in any other appropriate court within the County of Los Angeles, California. The prevailing party in such legal action shall be entitled to collect its reasonable attorney fees and costs from the other party in addition to any other damages or relief obtained in such proceedings.

7.4.2The procedural and substantive laws of the State of California shall govern the interpretation and enforcement of this Agreement, without regard to conflicts of laws principles. The Parties acknowledge and agree that this Agreement is entered into, is to be fully performed in and relates to real property located in the City of Montebello, County of Los Angeles, California.

7.5 Rights and Remedies are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties set forth in this ARTICLE VII are non- exclusive and cumulative, and the exercise by any 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(ies).

7.6 Developer Indemnification of the Sellers. In addition to any other specific indemnification or defense obligations of the Developer set forth in this Agreement, the Developer agrees to indemnify, defend (upon written request by the Sellers and with counsel reasonably acceptable to Sellers) and hold harmless the Indemnified Parties, from any and all losses, liabilities, charges, damages, claims, liens, causes of action, awards, judgments, costs and expenses, including, but not limited to reasonable attorney’s fees of counsel retained by the Indemnified

48 1603\46\2864071.5
Parties, expert fees, of whatever kind or nature, that are in any manner directly or indirectly caused, occasioned or contributed to in whole or in part, through any act, omission, fault or negligence, whether active or passive, of the Developer or the Developer’s officers, agents, employees, independent contractors or subcontractors of any tier, relating in any manner to this Agreement, any work to be performed by the Developer related to this Agreement, the Agency Properties, or the Project, or any authority or obligation exercised or undertaken by the Developer under this Agreement. Without limiting the generality of the foregoing, the Developer’s obligation to indemnify the Indemnified Parties shall include injury or death to any person or persons, damage to any property, regardless of where located, including the property of the Indemnified Parties, any workers’ compensation or prevailing wage determination, claim or suit or any other matter arising from or connected with any goods or materials provided or services or labor performed regarding the Project or the Property on behalf of the Developer by any person or entity. Notwithstanding anything to the contrary in this Agreement, including in this Section 7.6, Developer does not assume the risk, and shall not be responsible for, damages, including any fines or penalties assessed or charged to City and/or Successor Agency, pursuant to the Surplus Land Act (Government Code section 54220 et seq) or pursuant to redevelopment dissolution laws (Health and Safety Code section 34170 et seq.).

ARTICLE VIII.

GENERAL PROVISIONS.

8.1 Incorporation of Recitals. The Recitals of fact set forth preceding this Agreement are true and correct and are incorporated into this Agreement in their entirety by this reference.

8.2 Restrictions on Transfers.

8.2.1The Developer acknowledges that the qualifications and identity of the Developer are of particular importance to the City. The Developer further recognizes and acknowledges that the City has relied and is relying on the specific qualifications and identity of the Developer in entering into this Agreement with the Developer and, as a consequence, Transfers are permitted only as expressly provided in this Agreement. The Developer shall promptly notify the City in writing of any and all changes whatsoever in the identity of the business entities or individuals either comprising or in Control of the Developer, as well as any and all changes in the interest or the degree of Control of the Developer by any such person, of which information the Developer or any of its partners, members or officers are notified or may otherwise have knowledge or information.

8.2.2Except as expressly permitted in this Agreement, the Developer represents to the City that it has not made and agrees that it will not make or create, or suffer to be made or created, any Transfer other than a Permitted Transfer, either voluntarily, involuntarily or by operation of law, until after the recordation of a Certificate of Completion for the Project; provided, however, that the City may approve in its reasonable discretion, Transfers other than Permitted Transfers prior to the recordation of a Certificate of Completion. In deciding whether to approve or disapprove any such proposed Transfer, the City may consider the proposed transferee’s financial strength and the experience of the proposed transferee and its senior management in undertaking and successfully completing projects of a similar type and size as the Project or that portion of the Project proposed to be transferred. Any Transfer made in contravention of this

49 1603\46\2864071.5
Agreement shall be voidable at the election of the City and this Agreement may be terminated by the City or the City may exercise any other remedy available to the City under the terms of this Agreement, provided, however, that (i) the City shall first notify the Developer in writing of its intention to terminate this Agreement or to exercise any other remedy, and (ii) the Developer shall have thirty (30) calendar days following its receipt of such written notice to commence and, thereafter, diligently and continuously proceed to cure the default of the Developer and submit evidence of the initiation and satisfactory completion of such cure to the City, in a form and substance reasonably satisfactory to the City.

8.2.3The Developer shall provide the City no less than thirty (30) days prior written notice of any proposed Permitted Transfer which the Developer desires to enter into prior to the recordation of a Certificate of Completion for the Project subject to the Transfer. The Developer shall have the burden of demonstrating to the City’s reasonable satisfaction that the proposed Permitted Transfer meets the conditions and requirements of this Agreement with respect to Permitted Transfers.

8.2.4Anything in this Agreement to the contrary notwithstanding, the restrictions and prohibitions on Transfers contained in this Section 8.2 shall terminate upon issuance of a Certificate of Completion for the Project.

8.3 Notices, Demands and Communications Between the Parties.

8.3.1Any and all notices, demands or communications submitted by any Party to another Party pursuant to or as required by this Agreement shall be proper, if in writing and dispatched by messenger for immediate personal delivery, by a nationally recognized overnight courier service or by registered or certified United States Mail, postage prepaid, return receipt requested, to the principal office of the Sellers or the Developer, as applicable, as designated in Section 8.3.2. Such written notices, demands or communications may be sent in the same manner to such other addresses as either Party may from time to time designate. Any such notice, demand or communication shall be deemed to be received by the addressee, regardless of whether or when any return receipt is received by the sender or the date set forth on such return receipt, on the day that it is delivered by personal delivery, on the date of delivery by a nationally recognized overnight courier service or three (3) calendar days after it is placed in the United States Mail, as provided in this Section 8.3.

8.3.2The following are the authorized addresses for the submission of notices, demands or communications to the Parties:

TO DEVELOPER: Montebello Affordable Housing, LP
c/o Cesar Chavez Foundation
Attn: Legal Department
29700 Woodford Tehachapi Road
Keene, CA 93531
Attention: Paul S. Park
(T) 213-362-0260 (Ext 2261)
(F) 855-897-1429

50 1603\46\2864071.5
COPY TO: Rutan & Tucker, LLP
18575 Jamboree Road, 9th Floor
Irvine, CA 92612
Attention: Patrick D. McCalla
(T) 714-641-5100
(F) 714-546-9035
TO CITY:

COPY TO:

City of Montebello
Attention: City Manager
(T)
(F)
Alvarez-Glasman & Colvin
13181 Crossroads Pkwy. North
Suite 400 - West Tower
City of Industry, CA 91746
Attention: Arnold M. Alvarez-Glasman
Christopher G. Cardinale
(T) 562-699-5500
(F) 562-692-2244

8.4 Conflict of Interest. No member, official or employee of either Party has any conflict of interest, direct or indirect, related to this Agreement, the Agency Properties, or the development or operation of the Project within the meaning of applicable federal, state and local conflict of interest laws, including the Political Reform Act (Gov. Code, § 81000 et seq.) and California Government Code Section 1090. In compliance with the Levine Act (Government Code Section 84308), Developer represents and warrants that: (a) neither Developer nor any agent on behalf of Developer has made any campaign contributions of more than $250 to any member of the City Council between January 1, 2023 and the Effective Date of this Agreement; and (b) neither Developer nor any agent on behalf of Developer will make any campaign contribution of more than $250 to any member of the City Council within twelve (12) months after the date this Agreement is approved by the City Council.

8.5 Warranty Against Payment of Consideration for Agreement. The Developer warrants that it has not paid or given, and will not pay or give, any third party any money or other consideration for obtaining this Agreement. Third parties, for the purposes of this Section 8.5, shall not include persons to whom fees are paid for professional services, if rendered by attorneys, financial consultants, accountants, engineers, architects and the like when such fees are considered necessary by the Developer.

8.6 Non-liability of Sellers, Officials and Employees. No member, official or employee of the Sellers shall be personally liable to the Developer, or any successor in interest of the Developer, in the event of any default or breach by the Sellers under this Agreement or for any amount that may become due to the Developer or to its successor, or on any obligations under the terms of this Agreement, except as may arise from the gross negligence or willful acts of such member, official or employee.

51 1603\46\2864071.5

8.7 Unavoidable Delay; Extension of Time of Performance.

8.7.1Subject to specific provisions of this Agreement, performance by any Party under this Agreement shall not be deemed, or considered to be, in default where any such default is caused by an Unavoidable Delay that is not attributable to the fault of the Party claiming an extension of time to perform. An extension of time for any Unavoidable Delay shall be for the period of the Unavoidable Delay and shall commence to run from the date of occurrence of the Unavoidable Delay, if the Party asserting the existence of the Unavoidable Delay provides the other Parties with written notice of the occurrence of the Unavoidable Delay, within twenty (20) days of the commencement of such asserted Unavoidable Delay. Otherwise, the extension of time for an Unavoidable Delay shall commence on the date of receipt of written notice of the occurrence of the Unavoidable Delay by the Parties not requesting an extension of time to perform due to such Unavoidable Delay.

8.7.2The Parties expressly acknowledge and agree that changes in either general economic conditions or changes in the economic assumptions of either of them that may have provided a basis for entering into this Agreement and that occur at any time after the execution of this Agreement, do not constitute an Unavoidable Delay and do not provide any Party with grounds for asserting the existence of an Unavoidable Delay in the performance of any covenant or undertaking arising under this Agreement. Each Party expressly assumes the risk that changes in general economic conditions or changes in such economic assumptions relating to the terms and covenants of this Agreement could impose an inconvenience or hardship on the continued performance of such Party under this Agreement. Notwithstanding the foregoing, the limitations set forth in this section 9.7.2 shall not apply to delays in procurement of materials and/or labor due to cost escalation or to delays attributable to the unavailability of labor and/or materials required for the timely execution of the Project, which are the result of changes in general economic conditions that are outside of Developer’s control, which may include, but shall not be limited to, supply chain disruptions, transportation delays, and material and/or labor shortages.

8.8 Inspection of Books and Records. The Sellers shall have the right at all reasonable times, at the Sellers’s cost and expense, to inspect the books and records of the Developer pertaining to the Property and/or the Project, upon no less than seven (7) days prior written notice. The Developer shall also have the right at all reasonable times, at the Developer’s sole cost and expense, to inspect the books and records of the Sellers pertaining to the Agency Properties, Project Site, and/or the Project, to the extent relevant to the Developer’s obligations under this Agreement, upon no less than seven (7) days prior written notice. Nothing in this Section 8.8 or elsewhere in this Agreement shall, however, constitute a waiver or modification of any right or privilege which any Party may have with respect to any document, statement, or other record, including, without implied limitation, the attorney-client privilege, the attorney-work product privilege, any privilege arising under any state or federal evidentiary code or rule, or any privilege or exclusionary right arising under any state or federal freedom of information or public records disclosure law.

8.9 Real Estate Commissions. The Sellers and the Developer each represent and warrant to the other that no real estate brokerage commission is payable to any person or entity in connection with the transactions contemplated hereby on account of or due to the acts or omissions of such representing party, and each agrees to and does hereby indemnify, defend and hold the

52 1603\46\2864071.5
other harmless from and against the payment of any commission to any other person or entity claiming by, through or under the Sellers or the Developer, as applicable.

8.10 Binding on Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective heirs, executors, administrators, legal representatives, successors, and assigns.

8.11 Entire Agreement.

8.11.1This Agreement shall be executed in three (3) duplicate originals, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. This Agreement includes the exhibits and documents referenced and incorporated herein, and constitutes the entire understanding and agreement of the Parties regarding the Property, the Project, and the other subjects addressed in this Agreement.

8.11.2This Agreement integrates all of the terms and conditions mentioned in this Agreement or incidental to this Agreement, and supersedes all negotiations or previous agreements between the Parties with respect to the Property, the Project, and the other subjects addressed in this Agreement.

8.11.3None of the terms, covenants, agreements or conditions set forth in this Agreement shall be deemed to be merged with any deed conveying title to the Property and this Agreement shall continue in full force and effect before and after such conveyances.

8.11.4All waivers of the provisions of this Agreement and all amendments to this Agreement must be in writing and signed by the authorized representative(s) of all Parties.

8.12 Execution of this Agreement. Following execution of three (3) duplicate originals of this Agreement by the authorized representative(s) of the Developer and prompt delivery of such originals, thereafter, to the Sellers, accompanied by an official action of the governing body of the Developer authorizing the individuals executing this Agreement on behalf of the Developer to execute and perform this Agreement, in form and substance reasonably acceptable to the Sellers, this Agreement shall be subject to the review and approval by the City Council and Successor Agency Governing Board, in their sole and absolute discretion.

8.13 Survival of Indemnity Obligations. All general and specific indemnity and defense obligations of the Parties set forth in this Agreement shall survive the expiration or termination of this Agreement, the execution or recordation of the Grant Deeds, and/or the issuance and recordation of any Certificate of Completion.

8.14 Time Declared to be of the Essence. As to the performance of any obligation hereunder as to which time is a component thereof, the performance of such obligation within the time provided is of the essence.

8.15 Approvals. Except as otherwise provided in this Agreement, approvals required of the Sellers or the Developer, or any officers, agents or employees of the Sellers or the Developer, shall not be unreasonably withheld and approval or disapproval shall be given within the time set forth in this Agreement or, if no time is given, within a reasonable time.

53 1603\46\2864071.5

8.16 Further Assurances. The Parties agree to reasonably consider such additional actions or the execution of such other documents as may be reasonably necessary or convenient to the financing, development, and operation of the Project, although nothing in this Section 8.16 shall be deemed a representation, guaranty or commitment by any Party to take any action or execute any document.

8.17 City Approvals and Actions. The City Manager shall have the authority, on behalf of the Sellers (to the extent not provided otherwise in this Agreement), to make approvals, issue interpretations, waive provisions, grant extensions of time, approve amendments to this Agreement and changes to the attached exhibits prior to their execution and execute documents, including, without limitation, the Notice of Completion and any documents necessary to implement any changes in the number or affordability of the Qualifying Units (as defined in the Regulatory Agreement), as may be required by any of the Construction Financing, so long as such actions do not reduce the length of affordability of the Qualifying Units (as defined in the Regulatory Agreement). The City Manager reserves the right, in his or her sole and absolute discretion, to submit any requested modification, interpretation, amendment or waiver to the City Council and Successor Agency Governing Board if the City Manager reasonably determines or reasonably believes that such action could increase the risk, liability or costs to Sellers, or reduce the length of affordability of the Project, or is otherwise required by law.

8.18 Investor Limited Partner Provisions. If and when the Developer is in the form of a limited partnership and admits an investor limited partner into Developer's partnership, the City agrees to the following provisions for the benefit of the Developer's investor limited partner:

8.18.1If Developer has provided advance written notice to the City of the address and contract information of an investor limited partner, the City will give the limited partner a copy of any notice of default (at the limited partner's address provided in a notice by Developer to the City) that the City and/or Successor Agency gives to the Developer under this Agreement, the Regulatory Agreement, and/or the City Notes;

8.18.2The City will give known limited partners at least thirty (30) days after receipt of such default notice to cure a non-payment of any sum due under this Agreement, the Regulatory Agreement, and/or the City Notes;

8.18.3Each of the City and Successor Agency will give the limited partner sixty (60) days after the limited partner's receipt of such notice to cure any non-monetary default under this Agreement, the Regulatory Agreement, and/or the City Notes;

8.18.4If a non-monetary default is incapable of being cured within sixty (60) days, each of the City and Successor Agency shall allow the limited partner a reasonable time to cure such default provided the limited partner has commenced to cure such default within said sixty (60) day period, and diligently thereafter proceeding to cure such default without interruption until the default is cured;

8.18.5If the limited partner makes any such payment or otherwise cures such default, each of the City and Successor Agency will accept such action as curing such default as if such payment or cure were made by the Developer;

54 1603\46\2864071.5

8.18.6Each of the City and Successor Agency will permit the limited partner to transfer the limited partner's interest under the partnership agreement to any person or entity at any time;

8.18.7Each of the City and Successor Agency will permit the limited partner to remove the general partner of the partnership in accordance with the partnership agreement, provided that the substitute general partner is reasonably acceptable to the City, provided, however that any general partner that is an Affiliate of the tax credit investor is hereby deemed to be acceptable to the City; and

8.18.8Each of the City and Successor Agency will permit insurance and condemnation proceeds to be used to rebuild the Project provided that (i) sufficient funds are provided from other sources to effectively rebuild the Project to a lawful affordable housing multi- family complex, and (ii) subject to the rights of any Senior Lenders, the City shall hold all such proceeds and disburse them based on the progress of construction, subject to such additional reasonable conditions as the City may impose.
[Signatures on Following Pages]

SIGNATURE PAGE
CITY:

THE CITY OF MONTEBELLO
a California municipal corporation
Dated:_________________, 2023 By:

City Manager
ATTEST:
____________________________
City Clerk
APPROVED AS TO LEGAL FORM:

ALVAREZ-GLASMAN & COLVIN
By: _______________________
City Attorney
[Signatures continued on next page]

DEVELOPER:

MONTEBELLO AFFORDABLE HOUSING, LP
a California limited partnership
By: Montebello Affordable Housing, LLC
a California limited liability company
Its General Partner
By: Cesar Chavez Foundation,
a California nonprofit corporation,
Its Managing Member
By:

Paul S. Park, Secretary

1 Exhibit A
1603\46\2864071.5

EXHIBIT A
Legal Description of City Properties
All that certain real property situated in the County of Los Angeles, State of California, described as follows:

PARCEL 1:

LOT 19 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK (BEING A SUBDIVISION OF

CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE SOUTHWEST 88 FEET OF SAID LOT.

ALSO EXCEPT ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395 PAGE 381, OFFICIAL RECORDS.

PARCEL 2:

LOT 20 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK, IN THE CITY OF

MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO) AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM THE SOUTH 36 FEET OF THE NORTH 44 FEET OF THE WEST 115 FEET THEREOF.

PARCEL 3:

THE SOUTHERLY 36 FEET OF THE NORTHERLY 44 FEET OF THE WESTERLY 115 FEET OF LOT 20 OF THE ADDITION NO. 1, TO THE TOWN OF NEWMARK (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO,

COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM FROM PARCELS 2 AND 3 ABOVE ONE-HALF OF ALL OIL, GAS,

PETROLEUM, ASPHALTUM AND OTHER HYDROCARBON SUBSTANCES AND OTHER

MINERALS, PRODUCED FROM THE PREMISES, AS EXCEPTED IN THE DEED FROM HENRY M. NEWMARK AND MARIE LOUISE NEWMARK, HIS WIFE, AND ROSE N.

SUTRO AND ALFRED SUTRO, HER HUSBAND, RECORDED IN BOOK 6771 PAGE 81 OF OFFICIAL RECORDS OF SAID COUNTY.

2 Exhibit A
1603\46\2864071.5
PARCEL 4:

THE SOUTHERLY 44 FEET OF LOT 19 OF THE ADDITION NO. 1, TO THE TOWN OF

NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM AN INTEREST IN ALL OIL, OIL RIGHTS, NATURAL GAS

RIGHTS, MINERAL RIGHTS, ALL OTHER HYDROCARBON SUBSTANCES BY

WHATSOEVER NAME KNOWN, AND ALL RIGHTS THERETO, WITHOUT HOWEVER,

ANY RIGHT TO ENTER UPON THE SURFACE OF SAID LAND NOR ANY PORTION OF

THE SUBSURFACE, AS EXCEPTED OR RESERVED BY DEED RECORDED IN BOOK 7395, PAGE 381, OFFICIAL RECORDS.

APN: 6349-005-900, 901, 902 (Parcels 1-3) and 903 (Parcel 4)

1 Exhibit B
1603\46\2864071.5

EXHIBIT B
Legal Description of SA Property

1 Exhibit C
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EXHIBIT C
Legal Description of Developer Property
All that certain real property situated in the County of Los Angeles, State of California, described as follows:

PARCEL 5:

THE SOUTHWESTERLY 44 FEET OF THE NORTHEASTERLY 88 FEET OF LOT 19 OF ADDITION NO. 1, TOWN OF NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395, PAGE 381, OF OFFICIAL RECORDS.

APN: 6349-005-006 (Parcel 5)

1 Exhibit D
1603\46\2864071.5

EXHIBIT D
Depiction of Project Site
(See attached)

1 Exhibit D
1603\46\2864071.5

1 Exhibit E
1603\46\2864071.5

EXHIBIT E
Form of Grant Deed for City Properties
(see attached)

1 Exhibit E
1603\46\2864071.5
RECORDING REQUESTED BY:

City of Montebello

WHEN RECORDED MAIL TO AND MAIL
TAX STATEMENTS TO:

SPACE ABOVE FOR RECORDER’S USE ONLY

GRANT DEED
THE UNDERSIGNED GRANTOR(S) DECLARE(S):

Documentary Transfer Tax is $ _______________.;

PART ONE
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, THE CITY OF MONTEBELLO, a California municipal corporation (“Grantor”), hereby grants to MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership (“Grantee”), that certain real property located in the City of Montebello, County of Los Angeles, State of California, specifically described in Exhibit “A” attached to this Grant Deed (“Property”) and made a part of this Grant Deed by this reference.

PART TWO
The conveyance of the Property by the Grantor to the Grantee in Part One is subject to the following community development terms, conditions, covenants and restrictions:

Section 1. Obligation to Refrain from Discrimination. The Grantee for itself, its successors and assigns to all or any part or portion of the Property and/or Project, covenants and agrees that:

1.1. There shall be no discrimination against or segregation of any person, or group of persons, on account of sex, marital status, race, color, religion, creed, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor shall the Grantee, 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, sub-tenants, sub-lessees or vendees of the Property.

With respect to familial status, this Section 1.1 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in this Section 1.1 shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and

2 Exhibit E
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799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to this Section 1.1.

1.2. The covenant of this Section 1 shall run with the land of the Property in perpetuity and shall be enforceable against the Grantee and its successors and assigns in perpetuity.

Section 2. Form of Non-Discrimination and Non-Segregation Clauses. The Grantee for itself, its successors and assigns to all or any part or portion of the Property and/or Project, covenants and agrees that:

2.1. The Grantee, such successors and such assigns shall refrain from restricting the sale, lease, sublease, rental, transfer, use, occupancy, tenure or enjoyment of the Property (or any portion thereof) on the basis of sex, marital status, race, color, religion, creed, ancestry or national origin of any person. All deeds, leases or contracts pertaining to the Property shall contain or be subject to substantially the following non-discrimination or non-segregation covenants:
(a) In deeds: “The grantee herein covenants by and for itself, its successors 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, national origin, or ancestry 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 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, sub-tenants, sub-lessee, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.

Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 2.1(a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 4760, and Section 6714 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
(b) In leases: “The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, 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 race, color, creed, religion, sex, marital status, national origin, or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee 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, sub-lessee, sub-tenants, or vendees in the premises herein leased.

Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 2.1(b) shall not be construed to apply to housing for older persons, as defined in

3 Exhibit E
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Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 4760, and Section 6714 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
(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, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed or leased, nor shall the transferee 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, sub-lessees, sub-tenants, or vendees of the premises herein transferred.” The foregoing provision shall be binding upon and shall obligate the contracting party or parties and any subcontracting party or parties, or other transferees under the instrument. “Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 2.1(c) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 4760, and Section 6714 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
The covenants of this Section 2 shall run with the land of the Property in perpetuity.

GRANTOR:

THE CITY OF MONTEBELLO
a California municipal corporation
By: ___________________________
Rene Bobadilla, City Manager
[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

4 Exhibit E
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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, 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.
______________________________________
Name: ______________________________
Notary Public
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.

5 Exhibit E
1603\46\2864071.5

CERTIFICATE OF ACCEPTANCE OF

GRANT DEED
The undersigned hereby acknowledges acceptance by ___________________________, as the Grantee identified within the above Grant Deed, of the delivery of the subject Property described in the within Grant Deed from the City of Montebello and of Grantee’s acceptance of the terms, conditions, and covenants stated therein.

GRANTEE:
_____________,
Dated:_________________, 20__ By: _________________________

[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

6 Exhibit E
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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, 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.
______________________________________
Name: ______________________________
Notary Public
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.

7 Exhibit E
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EXHIBIT A

TO GRANT DEED
(Legal Description)
All that certain real property situated in the County of Los Angeles, State of California, described as follows:

PARCEL 1:

LOT 19 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK (BEING A SUBDIVISION OF

CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE SOUTHWEST 88 FEET OF SAID LOT.

ALSO EXCEPT ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395 PAGE 381, OFFICIAL RECORDS.

PARCEL 2:

LOT 20 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK, IN THE CITY OF

MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO) AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM THE SOUTH 36 FEET OF THE NORTH 44 FEET OF THE WEST 115 FEET THEREOF.

PARCEL 3:

THE SOUTHERLY 36 FEET OF THE NORTHERLY 44 FEET OF THE WESTERLY 115 FEET OF LOT 20 OF THE ADDITION NO. 1, TO THE TOWN OF NEWMARK (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO,

COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM FROM PARCELS 2 AND 3 ABOVE ONE-HALF OF ALL OIL, GAS,

PETROLEUM, ASPHALTUM AND OTHER HYDROCARBON SUBSTANCES AND OTHER

MINERALS, PRODUCED FROM THE PREMISES, AS EXCEPTED IN THE DEED FROM HENRY M. NEWMARK AND MARIE LOUISE NEWMARK, HIS WIFE, AND ROSE N.

SUTRO AND ALFRED SUTRO, HER HUSBAND, RECORDED IN BOOK 6771 PAGE 81 OF OFFICIAL RECORDS OF SAID COUNTY.

8 Exhibit E
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PARCEL 4:

THE SOUTHERLY 44 FEET OF LOT 19 OF THE ADDITION NO. 1, TO THE TOWN OF

NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM AN INTEREST IN ALL OIL, OIL RIGHTS, NATURAL GAS

RIGHTS, MINERAL RIGHTS, ALL OTHER HYDROCARBON SUBSTANCES BY

WHATSOEVER NAME KNOWN, AND ALL RIGHTS THERETO, WITHOUT HOWEVER,

ANY RIGHT TO ENTER UPON THE SURFACE OF SAID LAND NOR ANY PORTION OF

THE SUBSURFACE, AS EXCEPTED OR RESERVED BY DEED RECORDED IN BOOK 7395, PAGE 381, OFFICIAL RECORDS.

APN: 6349-005-900, 901, 902 (Parcels 1-3) and 903 (Parcel 4)

1 Exhibit F
1603\46\2864071.5

EXHIBIT F
Form of Grant Deed for SA Property
(see attached)

1 Exhibit F
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RECORDING REQUESTED BY:

Montebello Successor Agency

WHEN RECORDED MAIL TO AND MAIL
TAX STATEMENTS TO:

SPACE ABOVE FOR RECORDER’S USE ONLY

GRANT DEED
THE UNDERSIGNED GRANTOR(S) DECLARE(S):

Documentary Transfer Tax is $ _______________.;

PART ONE
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, THE MONTEBELLO SUCCESSOR AGENCY, a California successor agency created and existing pursuant to Health & Safety Code section 34170 et seq. (“Grantor”), hereby grants to CESAR CHAVEZ FOUNDATION, a California non-profit corporation (“Grantee”), that certain real property located in the City of Montebello, County of Los Angeles, State of California, specifically described in Exhibit “A” attached to this Grant Deed (“Property”) and made a part of this Grant Deed by this reference.

PART TWO
The conveyance of the Property by the Grantor to the Grantee in Part One is subject to the following community development terms, conditions, covenants and restrictions:

Section 1. Obligation to Refrain from Discrimination. The Grantee for itself, its successors and assigns to all or any part or portion of the Property, covenants and agrees that:

1.1. There shall be no discrimination against or segregation of any person, or group of persons, on account of sex, marital status, race, color, religion, creed, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor shall the Grantee, 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, sub-tenants, sub-lessees or vendees of the Property.

With respect to familial status, this Section 1.1 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in this Section 1.1 hall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and

2 Exhibit F
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Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to this Section 1.1.

1.2. The covenant of this Section 1 shall run with the land of the Property in perpetuity and shall be enforceable against the Grantee and its successors and assigns in perpetuity.

Section 2. Form of Non-Discrimination and Non-Segregation Clauses. The Grantee for itself, its successors and assigns to all or any part or portion of the Property, covenants and agrees that:

2.1. The Grantee, such successors and such assigns shall refrain from restricting the sale, lease, sublease, rental, transfer, use, occupancy, tenure or enjoyment of the Property (or any portion thereof) on the basis of sex, marital status, race, color, religion, creed, ancestry or national origin of any person. All deeds, leases or contracts pertaining to the Property shall contain or be subject to substantially the following non-discrimination or non-segregation covenants:
(a) In deeds: “The grantee herein covenants by and for itself, its successors 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, national origin, or ancestry 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 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, sub-tenants, sub-lessee, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.

Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 2.1(a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 4760, and Section 6714 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
(b) In leases: “The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, 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 race, color, creed, religion, sex, marital status, national origin, or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee 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, sub-lessee, sub-tenants, or vendees in the premises herein leased.

Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 2.1(b) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing

3 Exhibit F
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paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 4760, and Section 6714 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
(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, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed or leased, nor shall the transferee 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, sub-lessees, sub-tenants, or vendees of the premises herein transferred.” The foregoing provision shall be binding upon and shall obligate the contracting party or parties and any subcontracting party or parties, or other transferees under the instrument. “Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 2.1(c) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 4760, and Section 6714 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”

2.2. The covenants of this Section 2 shall run with the land of the Property in perpetuity.

GRANTOR:

THE MONTEBELLO SUCCESSOR AGENCY
a California successor agency
By: ___________________________
Rene Bobadilla, Executive Director
[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

4 Exhibit F
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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, 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.
______________________________________
Name: ______________________________
Notary Public
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.

5 Exhibit F
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CERTIFICATE OF ACCEPTANCE OF

GRANT DEED
The undersigned hereby acknowledges acceptance by ___________________________, as the Grantee identified within the above Grant Deed, of the delivery of the subject Property described in the within Grant Deed from the Montebello Successor Agency and of Grantee’s acceptance of the terms, conditions, and covenants stated therein.

GRANTEE:

CESAR CHAVEZ FOUNDATION,
a California nonprofit public benefit
corporation
Dated:_________________, 20__ By: _________________________

[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

6 Exhibit F
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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, 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.
______________________________________
Name: ______________________________
Notary Public
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.

7 Exhibit F
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EXHIBIT A

TO GRANT DEED
(Legal Description)

1 Exhibit G
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EXHIBIT G
Developer’s Project Narrative
Project Site: The Project Site is five (5) lots at 112, 114, 124, 128, 132 South 6th Street in Montebello, California 90640, with the following Los Angeles County Assessor’s Parcel Numbers (APN): 6349-005-900, 901, 902, 903 and 006. The Project Site is approximately 35,000 square feet or .80 acres.

Housing Unit Mix and Affordability: The 63-unit development shall be 100% affordable housing (with the exception of one (1) manager’s unit) and target families and survivors of domestic violence and have LACDA project based vouchers (“special needs units”). The unit mix shall be: (a) 27 one (1)-bedroom units, 25 of which shall be special needs units; (b) 16 two (2)-bedroom units, 3 of which shall be special needs units; (c) 19 three (3)-bedroom units, 3 of which shall be special needs units; and (d) 1 three (3)-bedroom manager’s unit. The unit mix and affordability levels of the affordable housing units shall be as follows:

Bedrooms Low Income Units Special Needs Units Total Units 1 2 @ 60% AMI 25 @ 30% AMI 27
2 13 @ 60% AMI 3 @ 30% AMI 16
3 16 @ 60% AMI 3 @ 30% AMI 19 (plus 1 manager unit)
TOTAL 31@ 60% AMI 31 @ 30% AMI 62 (plus 1 manager unit) Project Buildings: The Project building shall be a mix of three (3) and four (4) stories that is developed over one (1) level of subterranean parking. The Project shall incorporate sustainable building features including solar panels and shall be LEED Gold certified upon issuance of a final Certificate of Occupancy. The subterranean parking and ground floor shall be Construction Type A, and a podium deck under the 3rd and 4th stories shall be Construction Type VA.

Parking: The subterranean parking garage shall include 42 parking stalls, and an additional 15 surface parking stalls shall be provided (7 of which shall be electric charging stations); for a total of 67.

Architecture: The Project shall offer an infill mid-rise building that incorporates a contemporary modern theme design with distinct color paneling. Upper terrace decks shall be iincorporated into the design for common open space overlooking a ground floor entry courtyard.

Open Space and Amenities: Open space terraces shall include decorative landscaped courtyards, a tot lot, tween and a recreational areas. A community room shall be located on first and shall include the following amenities: computer room, mmanagement office, meeting/classroom space, counseling office, public resident restrooms, facilities for after- school, active and passive recreation areas. Laundry rooms and BBQ areas shall be provided.

1 Exhibit H
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EXHIBIT H
Project Budget / Proforma

1 Exhibit I
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EXHIBIT I
Schedule of Performance

TASK COMPLETION

DEADLINE
All conditions to closing have been satisfied or waived and Close of Escrow occurs.

No later than March 31,
2023
Developer commences construction No later than 60 days after Close of Escrow
City disburses Predevelopment Loan No later than January 31, 2024
Developer completes construction No later than the date that is 30 months after the date
a building permit is issued
for the Project by the City.

Developer’s Construction Financing converts to the
Permanent Loan
No later than 9 months
after completion of
construction

1 Exhibit J
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EXHIBIT J
Form of Regulatory Agreement
(see attached)

1 Exhibit J
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RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

City of Montebello
1600 West Beverly Blvd,
Montebello, California
Attn: City Manager
_____________________________________________________________________________________________ APN: 6349-005-900, 901, 902, 903 & 006 SPACE ABOVE FOR RECORDER'S USE ONLY

EXEMPT FROM RECORDING FEE PER
GOVERNMENT CODE §27383

REGULATORY AGREEMENT
(6th Street Grand, Montebello Phase 1)
by and between

THE CITY OF MONTEBELLO,
a California municipal corporation,
and

MONTEBELLO AFFORDABLE HOUSING, LP,
a California limited partnership,
[Dated as of March ___, 2023, for reference purposes only]

2 Exhibit J
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REGULATORY AGREEMENT
(6th Street Grand, Montebello Phase 1)
This REGULATORY AGREEMENT (6 th Street Grand, Montebello Phase 1) ("Regulatory Agreement") is made and entered into as of March __, 2023, by and between THE CITY OF MONTEBELLO, a California municipal corporation ("City") and MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership ("Owner").

RECITALS
A. The City, the Montebello Successor Agency, and Owner entered into that certain Purchase, Sale, and Affordable Housing Development Agreement (6 th Street Grand, Montebello Phase 1) dated as of ____________, 2023 (the "Affordable Housing Agreement"), pursuant to which and subject to the terms and conditions therein the City sold to the Owner those certain properties located at 112, 114, 124, and 132 South 6th Street, City of Montebello, California (APN 6349-005-900, 901, 902 and 903) (the "City Properties"), and Developer agreed to combine the City Properties with those certain properties owned and controlled by Owner located at 128 and 128 ½ South 6th Street, City of Montebello, California (APN 6349-005-006), into a single development parcel totaling 35,000 square feet (or .80 acres) legal described in Attachment No. 1 hereto (the “Project Site”).

B. Under the Affordable Housing Agreement, the City has agreed to provide financial assistance to the Owner for acquisition of the Property and the construction thereon by the Owner of a sixty-three (63)-unit affordable rental housing residential development (the “Project”), as more specifically described and defined in the Affordable Housing Agreement.

C. The City and the Owner desire that the Project be operated as a multifamily residential community on the Property with the residential units made available to Qualified Households at an Affordable Rent as more specifically defined herein. This Regulatory Agreement establishes terms and conditions which govern the operation of the Property.

D. The terms of the Affordable Housing Agreement require that certain covenants and affordability restrictions remain in full force and effect on the Project for a term commencing on the date of recordation of this Regulatory Agreement and continuing for fifty-five (55) years following the recordation of the Certificate of Completion as defined herein.

Now, therefore, in consideration of the mutual covenants and undertakings set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Owner and the City do hereby covenant and agree for themselves, their successors and assigns as follows:

1. Definitions of Certain Terms. As used in this Regulatory Agreement, the following words and terms shall have the meaning as provided in the recitals or in this Section 1. All initially capitalized terms used and not otherwise defined in the recitals or in this section shall have the meaning ascribed to such term by the Affordable Housing Agreement.

1.1. 30% Household. An individual or household that has a household income not

3 Exhibit J
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greater than thirty percent (30%) of then current AMI adjusted for household size.

1.2. 60% Household. An individual or household that has a household income not greater than sixty percent (60%) of current AMI adjusted for household size.

1.3. Affordable Rent. In reference to each Qualifying Unit, the maximum rent, with allowance for utilities, for the applicable household income not to exceed for 30% Households the amount set forth in California Health & Safety Code Section 50053(b)(1) adjusted for family size appropriate for the unit, and not to exceed for 60% Income Households the product of 30 percent times 60 percent of the AMI adjusted for family size appropriate for the unit.

1.4. AMI. The median gross yearly income in the County of Los Angeles, California, as published from time to time by HCD using the standards set forth in the California Health & Safety Code. In the event that such income determinations are no longer published, or are not updated for a period of at least eighteen (18) months, the City shall provide the Developer with other income determinations which are substantially similar with respect to methods of calculation to those previously published by HCD.

1.5. Annual Report. The Certification of Continuing Program Compliance attached to this Regulatory Agreement as Attachment No. 3 and incorporated by this reference or comparable report filed annually by the Owner with TCAC or other governmental agencies.

1.6. Automobile Liability Insurance. Insurance coverage against claims of personal injury (including bodily injury and death) and property damage covering all the Owner owned, leased, hired and non-owned vehicles, with minimum limits for bodily injury and property damage of One Million Dollars ($1,000,000). Such insurance shall be provided by a business or commercial vehicle policy and may be provided through a combination of primary and excess or umbrella policies, all of which shall be subject to pre-approval by the City, which approval shall not be unreasonably withheld, delayed or conditioned.

1.7. Certificate of Completion. The written certification of the City, in substantially the form of Exhibit G attached to the Affordable Housing Agreement, certifying that the construction of the Project has been completed in compliance with the terms and conditions of this Regulatory Agreement.

1.8. City Parties. Collectively, the City and its commissions, agents, attorneys, officers, employees, and authorized representatives.

1.9. HCD. The California Department of Housing and Community Development.

1.10. Income Certification Form. The Certification of Tenant Eligibility attached to this Regulatory Agreement as Attachment No. 2 and incorporated by this reference, or comparable income certification form required by TCAC or other governmental agencies.

1.11. Liability Insurance. Commercial general liability insurance against claims for bodily injury, personal injury, death, or property damage occurring upon, in, or about the Property or the Project, at least as broad as Insurance Services Office Occurrence Form CG0001, with a minimum liability limit of Two Million Dollars ($2,000,000) for any one occurrence and which

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may be provided through a combination of primary and excess or umbrella insurance policies. If commercial general liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to the Project or the general aggregate limit shall be twice the required minimum liability limit for any one occurrence.

1.12. Management Agent. A person with significant experience in management of affordable rental housing projects substantially similar to the Project and that is, at the time, managing other financially self-supporting, successful affordable rental housing projects substantially similar to the Project.

1.13. Manager Unit. The one (1) Three Bedroom Unit within the Project reserved exclusively for use by the on-site manager employed by the Owner or the Management Agent, as applicable.

1.14. One Bedroom Unit. Any one of the one bedroom residential accommodations within the Project.

1.15. Project. The operation of a multi-family rental housing project which shall include not less than sixty-three (63) units, sixty-two (62) of which shall be rented to Qualified Households at Affordable Rents, and all related on- and off-site improvements, as more particularly described in the Affordable Housing Agreement.

1.16. Property Insurance. Insurance providing coverage for the Property and all improvements on or to the Property against loss, damage, or destruction by fire and other hazards encompassed under the broadest form of property insurance coverage then customarily used for like properties in the County of Los Angeles, excluding earthquake coverage, in an amount equal to one hundred percent (100%) of the replacement value (without deduction for depreciation) of all improvements comprising the Project (excluding excavations and foundations) and in any event sufficient to avoid co-insurance and with no co-insurance penalty provision, with "ordinance or law" coverage. To the extent customary for like properties in the County of Los Angeles at the time, such insurance shall include coverage for explosion of steam and pressure boilers and similar apparatus located on the Property; an "increased cost of construction" endorsement; and an endorsement covering demolition and cost of debris removal, all subject to policy sublimits.

Property Insurance shall also include rental or business interruption insurance in an amount, at least, equal to the average annual gross income from the Project for the preceding three (3) calendar years and providing for a 12-month extended period of indemnity.

1.17. Qualified Households. A household that (1) intends to reside in the Qualifying Unit; and (2) whose income does not exceed the maximum income allowable for the subject Qualifying Unit.

1.18. Qualifying Units. The twenty-seven (27) One Bedroom Units, sixteen (16) Two Bedroom Units, and nineteen (19) Three Bedroom Units within the Project restricted to occupancy by Qualified Households as set forth in Section 6 (exclusive of the Manager Unit).

1.19. Special Needs Household. Means twenty-five (25) of the One Bedroom Units, three (3) of the Two Bedroom Units, and three (3) of the Three Bedroom Units that shall be restricted for residency by individuals or families that are survivors of domestic violence, and each

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of which shall be a 30% Household.

1.20. Tax Credits. An allocation from TCAC of nine percent (9%) federal low income housing tax credits and State low income housing tax credits to finance a portion of the costs of the Project, in accordance with Section 42 of the Internal Revenue Code of 1986, as amended, all associated Internal Revenue Service regulations and all associated TCAC regulations.

1.21. TCAC. The California Tax Credit Allocation Committee or its successor in function.

1.22. Term. The period of time following the date of recordation of this Regulatory Agreement, and ending on the fifty-fifth (55th) anniversary of recordation of the Certificate of Completion.

1.23. Three Bedroom Unit. Any one of the three bedroom residential accommodations within the Project.

1.24. Two Bedroom Unit. Any one of the two bedroom residential accommodations within the Project.

1.25. Workers Compensation Insurance. Workers compensation insurance complying with the provisions of California law and an employer's liability insurance policy or endorsement to a liability insurance policy, with a minimum liability limit of One Million Dollars ($1,000,000) per accident for bodily injury or disease, covering all employees of the Owner.

2. Reservation of Property for Affordable Housing. The Owner covenants and agrees to reserve and restrict the Property for construction of the Project and, thereafter, reserve and restrict use and residential occupancy of the Qualifying Units by households who, at the time of initial occupancy of a Qualifying Unit and continuously thereafter (subject to the other provisions of this Regulatory Agreement), until the end of the Term, are members of a Qualifying Household. One (1) Three Bedroom Unit within the Project may be used as a Manager Unit at any given time provided that no Qualifying Unit shall be used as a Manager Unit.

3. Affordable Multi-Family Residential Rental Property Restrictive Covenant. The Owner covenants to and for the benefit of the City that the Owner shall develop, own, manage and operate, or cause the management and operation of, the Project to provide multi-family residential rental housing in the Qualifying Units only to Qualifying Households at an Affordable Rent. The Owner hereby confirms and remakes its covenant set forth in Section 4.1 of the Affordable Housing Agreement to develop the Property with the Project and such covenant is incorporated into this Regulatory Agreement in its entirety by this reference. The Owner will not knowingly permit any Qualifying Unit to be used on a transient basis and will not lease or rent any Qualifying Unit for an initial period of less than twelve (12) months. No Qualifying Unit will, at any time, be leased or rented for use as a hotel, motel, time share, short term rental unit, dormitory, fraternity house, sorority house, rooming house, hospital, nursing home, sanitary or rest home.

4. Continuous Operation Covenant. The Owner covenants to and for the benefit of the City to cause the Project to be continuously operated, in accordance with the other provisions of this Regulatory Agreement, throughout the Term.

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5. Abandonment. The Owner shall not abandon or surrender the operation of all or any part of the Project during the Term, except due to material casualty or condemnation.

6. Rental of Qualifying Units. The Owner covenants that each Qualifying Unit shall be occupied or available for occupancy by a Qualifying Household at an Affordable Rent on a continuous basis throughout the Term, in accordance with the following tenant income level mix:

6.1. Not less than two (2) of the One Bedroom Units shall be occupied or available for occupancy by Qualifying Households that are 60% Households; and

6.2. Not less than twenty-five (25) of the One Bedroom Units shall be occupied or available for occupancy by a Special Needs Household; and

6.3. Not less than thirteen (13) of the Two Bedroom Units shall be occupied or available for occupancy by Qualifying Households that are 60% Households; and

6.4. Not less than three (3) of the Two Bedroom Units shall be occupied or available for occupancy by a Special Needs Household; and

6.5. Not less than sixteen (16) of the Three Bedroom Units shall be occupied or available for occupancy by Qualifying Households that are 60% Households; and

6.6. Not less than three (3) of the Three Bedroom Units shall be occupied or available for occupancy by a Special Needs Household.

It is anticipated that the Property will be supported by Project-Based Section 8 rental subsidy payments (the “Rental Subsidy”). If, during the term of this Regulatory Agreement, any change in federal law or regulations occurs, or any action (or inaction) by Congress or any federal or State agency occurs, which results in a reduction, termination, or nonrenewal of the Rental Subsidy through no fault of Owner, such that the Rental Subsidy as it exists as of the date of this Regulatory Agreement is no longer available (or available in a lesser amount), Owner may request approval of City to (i) allow 60% Households to occupy the Qualifying Units otherwise restricted for Special Needs Households, and (ii) increase the rent on one or more of such Qualifying Units, to rents that are affordable to 60% Households, as outlined herein.

The income limit and rent increases described in subsections (i) and (ii) above are subject to the following requirements: concurrently with the request, Owner shall provide the City with (a) evidence of the anticipated reduction, termination, or nonrenewal of the Rental Subsidy, (b) a management plan for the Project for the City’s approval (such approval not to be unreasonably withheld of delayed), showing the impact of the loss or reduction of the Rental Subsidy, (c) a proposed operating budget reflecting the rent increases (the “Operating Budget”), and (d) a description of Owner’s efforts to obtain alternate sources of rental subsidies, and, if the foregoing requirements are completed to the City’s reasonable satisfaction, subject to the limitations set forth in the immediately succeeding sentence, the City shall approve Owner’s request to increase the income limits and rent restrictions applicable to such Qualifying Units. The number of Qualifying Units subject to the rent increase and the amount of the proposed increase may not be greater than (i) the number or amount required to ensure that the Project generates sufficient income to cover its operating costs, required deposits to replacement reserves, and debt service payments on

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approved financing as shown on the Operating Budget (together, the “Minimum Liabilities”), and (ii) such amount as is necessary for the Project to maintain a debt service coverage ratio of at least 1.15 to 1.00 (the “Debt Service Coverage Ratio”). As used herein, “Debt Service Coverage Ratio” means, for any period, the ratio of (a) net operating income for such period to (b) all principal and interest payments due and payable during such period, regardless of whether the Project is generating sufficient cash flow. In addition, upon a reduction, termination, or nonrenewal of the Rental Subsidy as described above, Owner hereby agrees to the following:
i. Owner shall use good faith commercially reasonable efforts to obtain alternative sources of rental subsidies and shall provide the City with quarterly progress reports on efforts to obtain alternative sources of rental subsidies that would allow the rents to be reduced. Upon receipt of any alternative rental subsidies, Owner shall reduce the rents as much as possible with the goal of reverting the rents to their original levels as set forth herein to the extent that the alternative rental subsidies provide sufficient income to cover the Minimum Liabilities of the Project as shown on the Operating Budget and to maintain a Debt Service Coverage Ratio of 1:15 to 1.00;
ii. Owner shall provide tenants in the Qualifying Units with at least sixty (60) days’ written notice of any rent increase and shall notify each tenant that if they have received a tenant-based voucher from the Los Angeles County Development Authority or any other governmental entity they may use such voucher to pay the rent for their Qualifying Unit; and
iii. All rent increases are subject to City approval pursuant to the terms herein. No later than sixty (60) days prior to the proposed implementation of any rent increase, Owner shall submit to the City a schedule of any proposed increase in the rent. The City will disapprove a rent increase if it does not comply with the restrictions set forth herein. Notwithstanding the foregoing, rent increases for the Qualifying Units shall be subject to review and approval of the City (such approval not to be unreasonably withheld or delayed) as described above.

With respect to any Qualifying Units for which City has authorized Owner to increase rents pursuant to this Section, all special and/or target population preferences and requirements shall automatically terminate.

7. Affordable Rent. The monthly rent charged to a Qualifying Household for the occupancy of a Qualifying Unit shall never exceed an Affordable Rent for such Qualifying Unit set forth in Section 1.3.

7.1. Rent for Qualifying Units may be increased only once per calendar year, based on changes in AMI; provided that the rent for each Qualifying Unit must never exceed an Affordable Rent for the Qualifying Unit as necessary to maintain the tenant income mix specified in Section

6. 7.2. Determination of Qualifying Household income shall be made by the Owner at the time of initial application by an individual or family for occupancy of a Qualifying Unit. At the time of initial application, the Owner shall require an applicant to complete the Income

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Certification Form and certify the accuracy of the information provided on such form. On an annual basis during the Term, the Owner shall require each Qualifying Household occupying a Qualifying Unit to recertify the Qualifying Household's income on the Income Certification Form.

The Owner shall make a good faith effort to verify the accuracy of income information provided in any Income Certification Form by an applicant for occupancy of a Qualifying Unit or by a Qualifying Household occupying a Qualifying Unit, by taking one or more of the following steps, as reasonably required or indicated: (1) obtain an income tax return and copy of each W2 Wage and Earnings Statement for the most recently concluded income tax year; (2) conduct a credit reporting agency or similar search; (3) obtain an income verification form from the applicant's or the Qualifying Household's current employer(s); (4) obtain an income verification form from the United States Social Security Administration and/or the California Department of Social Services, if the applicant or the Qualifying Household receives assistance from either of such agencies; or (5) if the applicant or an adult member of a Qualifying Household is unemployed and has no such income tax return, obtain another form of independent verification. All such verification information shall only be obtained by the Owner after obtaining the applicant's or the Qualifying Household's written consent for the release of such information to the Owner. Failure to consent in writing to the release of such income verification information to the Owner may disqualify an applicant for occupancy of a Qualifying Unit or be grounds for termination of Qualifying Household's occupancy of a Qualifying Unit.

7.3. The Qualifying Units are not specifically assigned to any qualifying income category (i.e., 30% Household or 60% Household). The restricted income level of each Qualifying Unit may change as Qualifying Units become vacant, a Qualifying Household tenant's income changes or other Qualifying Units are occupied by Qualifying Households. In all circumstances, though, the rent for each Qualifying Unit shall be an Affordable Rent for the Qualifying Unit as necessary to maintain the restricted income tenant mix required under Section 6. If the income category of a Qualifying Household upon recertification is different from the previous income of the Qualifying Household (i.e. a 30% Household becomes a 60% Household or a 60% Household's income exceeds the qualifying income limit for a 60% Household ), the Owner or Management Agent shall rent the next available Unit to a Qualifying Household with an income level that will maintain the tenant income level mix set forth in Section 6. To the extent the federal low-income housing tax credit requirements conflict with the requirements in this Section 7.3 relative to the continued occupancy by households that do not qualify as Qualifying Households, the federal low- income housing tax credit requirements shall apply in place of the provisions in this Section 7.3.

7.4. The Owner shall maintain on file all Income Certification Forms completed by applicants for occupancy of Qualifying Units and by Qualifying Households that occupied or are occupying Qualifying Units in accordance with Section 6 and shall provide copies of the rent roll and Income Certification Forms to the City for its review and approval within fifteen (15) days following written Notice to the Owner.

7.5. The Owner and each Qualifying Household occupying a Qualifying Unit shall permit the City to conduct inspections of the Property, the Project and each Qualifying Unit, from time-to-time, for purposes of verifying compliance with this Regulatory Agreement, upon fifteen (15) days prior written notice to the Owner.

7.6. The Owner shall submit its first Annual Report to the City on the April 30th

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immediately following the issuance of the final Certificate of Occupancy for the Project by the City. Thereafter, on each April 30 during the Term, the Owner shall submit an Annual Report to the City. The City shall maintain the confidentiality of the information contained in any Annual Report specifically relating to any particular Qualifying Household occupying a Qualifying Unit, to the extent reasonably allowed by Law, as determined by the City's general or special counsel.

8. The Owner Covenant Regarding Lease of Qualifying Units. The Owner, for itself, its successors and assigns, covenants and agrees that, if any Qualifying Unit is rented or leased during the Term, the rental or lease of the Qualifying Unit shall be accomplished through a written lease agreement and all of the following restrictions shall apply:

8.1. A Qualifying Household shall be the record tenant and only occupant of the Qualifying Unit.

8.2. The lease for each Qualifying Unit shall be for an initial term of not less than twelve (12) months.

8.3. Each lease for a Qualifying Unit shall contain all of the following provisions:

8.3.1. An agreement authorizing the Owner to immediately terminate the tenancy of a Qualifying Household occupying a Qualifying Unit, where one or more members of that Qualifying Household misrepresented any fact material to the qualification of such household as a Qualifying Household;

8.3.2. An agreement providing that each Qualifying Household occupying a Qualifying Unit shall be subject to annual certification or recertification of income as a condition to continued occupancy of the Qualifying Unit;

8.3.3. An agreement providing that each Qualifying Household occupying a Qualifying Unit may be subject to rental increases in accordance with this Regulatory Agreement; and

8.3.4. An agreement providing that the Owner will not discriminate on the basis of race, color, creed, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, genetic information or receipt of public assistance or housing assistance in connection with rental of a Qualifying Unit, or in connection with the employment or application for employment of persons for operation and management of the Project, and all contracts, applications and leases entered into for such purposes shall contain similar non-discrimination clauses to such effect.

8.4. The Owner shall not terminate the tenancy or refuse to renew the lease or rental agreement of a Qualifying Household except for: (i) serious or repeated violations of the terms and conditions of the lease; (ii) because the previously Qualifying Household is no longer a Qualifying Household; (iii) for violation of applicable Federal, State, or local law; or (iv) for other good cause.

The Owner shall follow all applicable laws in connection with termination of the tenancy of a Qualifying Household or a refusal to renew the lease or rental agreement of a Qualifying Household.

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8.5. Tenant Selection Policies and Criteria. The Owner shall adopt written tenant selection policies and criteria that:

8.5.1. are consistent with the purpose of providing affordable rental housing for Qualifying Households at an Affordable Rent;

8.5.2. are reasonably related to tenant eligibility and ability to perform the obligations of the lease for a Qualifying Unit;

8.5.3. subject to applicable fair housing laws and provided that the applicant meets standard applicant screening standards for the Project, give reasonable preference and consideration to the housing needs of households residing in, employed in, or offered employment in the City of Montebello;

8.5.4. provide for the selection of tenants from a written waiting list maintained by the City in the chronological order of their application subject to Section 8.5.3, insofar as is practicable;

8.5.5. give prompt written notice to any rejected applicant of the grounds for rejection;

8.5.6. provide for all of the Qualifying Units to be available for occupancy on a continuous basis to Qualifying Households at an Affordable Rent; and

8.5.7. do not give preference to any particular class or group of persons in leasing or renting the Qualifying Units, except as provided in Section 8.5.3 and to the extent that a tenant must be a Qualifying Household.

To the extent the preferences set forth in this Section 8.5 conflict with the requirements of applicable federal and state fair housing laws or Section 42 of the Internal Revenue Code and implementing guidelines, the requirements of the applicable federal and state fair housing laws and Section 42 will supersede. Developer shall coordinate all marketing efforts through the City.

9. Non-Discrimination. All units in the Project shall be available at an Affordable Rent for occupancy on a continuous basis to Qualified Households. Except as provided in Sections 8.5.3,

8.5.4, and 8.5.6, the Owner shall not give preference to any particular class or group of persons in renting the units in the Project. There shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, or genetic information in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of any Unit. Neither the Owner nor any person claiming under or through the Owner, shall establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees of any Unit or in connection with the employment of persons for the operation and management of any Unit, the Project or the Property. All deeds, leases or contracts made or entered into by the Owner as to the units, the Project or the Property or any portion thereof, shall contain covenants prohibiting discrimination, as prescribed by this Regulatory Agreement. The Owner shall include a statement in all advertisements, notices and

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signs for the availability of units in the Project for rent to the effect that the Owner is an Equal Housing Opportunity Provider.

10. Equal Housing Notice. Provide for a statement in all advertisements, notices and signs for the availability of Qualifying Units for lease or rent to the effect that the Owner is an equal housing opportunity provider, and include an equal housing opportunity logotype in all notices, signs and advertisements in print media for the Qualifying Units.

11. Development and Management of the Project.

11.1. Management of Project. The Owner shall be responsible for management of the Project including, without limitation, the selection of Qualified Households, certification and recertification of household size, income, gender and the age of the head of household and relation of head of household to the household, of all Qualified Households, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. The City shall bear no responsibility for the management or operation of the Project or the Property. The Project shall at all times be managed by a Management Agent reasonably acceptable to the City, with demonstrated ability to operate residential rental facilities similar to the Project in a manner that will provide decent, safe, and sanitary housing. For the purposes hereof, if the Owner directly performs the functions of the Management Agent by its employees or by means of a service contract with an entity which is a partner or an affiliate of a partner in the Owner, such Management Agent shall be deemed approved by the City. If the Management Agent is an entity or person other than the Owner, its employees, a partner in the Owner or an entity owned or controlled by the Owner or which owns and/or controls the Owner, the Owner shall submit for the City's approval the identity of any proposed Management Agent, together with additional information relevant to the background, experience and financial condition of any proposed Management Agent, as reasonably requested by the City. If the proposed Management Agent meets the standard for a qualified Management Agent set forth above, the City shall approve the proposed Management Agent by notifying the Owner in writing within thirty (30) days following the Owner's written request for such approval. Unless the proposed Management Agent is disapproved by the City within thirty (30) days, which disapproval shall state with reasonable specificity the basis for disapproval, it shall be deemed approved. The City hereby approves Advanced Property Services, LLC, as the initial Management Agent. (1) If the Owner directly performs the functions of the Management Agent by its employees or by means of a service contract with an entity which is a partner or an affiliate of a partner in the Owner and the City determines the Owner has not met its management responsibilities, the City shall have the right to enter the Project, to review relevant documentation to determine if the Owner is acting in a reasonable manner and, subject to the approval of (i) the investor limited partner and special limited partner (collectively, the “Tax Credit Investor”) of Owner, and (ii) Lender, to require the Owner to hire a third party management company acceptable to the City.

11.2. Insurance.

11.2.1. Required Insurance. The Owner shall maintain, to protect the City Parties against all insurable claims resulting from the actions of the Owner in connection with this

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Regulatory Agreement, the Property and the Project, at the sole cost and expense of the Owner during the Term hereof the following insurance (or its then reasonably available equivalent): (a) Liability Insurance; (b) Automobile Liability Insurance to the extent required by this Regulatory Agreement; (c) Property Insurance; and (d) Workers Compensation Insurance. The Owner shall require all subcontractors to maintain the same insurance required of the Owner set forth in this Section 11.2 prior to performing any work on the Property or the Project. Notwithstanding the foregoing, however, Owner’s obligation to procure Property Insurance shall not commence until such time as the Certificate of Completion has been recorded.

11.2.2. Policy Requirements and Endorsements. All insurance policies required by this Regulatory Agreement shall contain (by endorsement or otherwise) the following provisions:

Insured. The Owner's Liability Insurance and Automobile Liability Insurance policies shall name the City Parties as "additional insured." The Owner's Property Insurance policy shall name the City as a "loss payee." The coverage afforded to the City Parties shall be at least as broad as that afforded to the Owner regarding the Property and the Project and may not contain any terms, conditions, exclusions, or limitations applicable to the City Parties that do not apply to the Owner.

Primary Coverage. Any insurance or self-insurance maintained by the City Parties shall be in excess of all insurance required under this Regulatory Agreement and shall not contribute to any insurance required under this Regulatory Agreement.

Contractual Liability. The Owner's Liability Insurance policy shall contain contractual liability coverage for the Owner's indemnity obligations under this Regulatory Agreement. The Owner's obtaining or failure to obtain such contractual liability coverage shall not relieve the Owner from nor satisfy any indemnity obligation of the Owner under this Regulatory Agreement.

Deliveries to the City. The Owner shall deliver to the City evidence of all insurance policies required by this Regulatory Agreement. No later than three (3) days before any insurance required by this Regulatory Agreement expires, is cancelled or its liability limits are reduced or exhausted, the Owner shall deliver to the City evidence of the Owner's maintenance of all insurance this Regulatory Agreement requires. Each insurance policy required by this Regulatory Agreement shall be endorsed to state that coverage shall not be cancelled, suspended, voided, reduced in coverage or in limits, except after thirty (30) calendar days' advance written notice of such action has been given to the City by certified mail, return receipt requested; provided that if a thirty (30) days' notice of cancellation endorsement is not available the Owner shall notify the City of this unavailability in writing and shall forward any notice of cancellation to the City within two (2) business days from date of receipt by the Owner; and further provided, however, that only ten (10) days' advance written notice shall be required for any such action arising from non-payment of the premium for the insurance. Phrases such as "endeavor to" and "but failure to mail such Notice shall impose no obligation or liability of any kind upon the company" shall not be included, to the extent commercially available, in the cancellation wording of any certificates or policies of insurance applicable to the City Parties pursuant to this Regulatory Agreement.

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Waiver of Certain Claims. The Owner shall cause each insurance carrier providing insurance coverage under this Regulatory Agreement to endorse their applicable policy(ies) with a Waiver of Subrogation with respect to the City Parties, if not already in the policy. To the extent that the Owner obtains insurance with a Waiver of Subrogation, the parties release each other, and their respective authorized representatives, from any claims for damage to any person or property to the extent such claims are paid by such insurance policies obtained pursuant to and in satisfaction of the provisions of this Regulatory Agreement.

No Claims Made Coverage. None of the insurance coverage required under this Regulatory Agreement may be written on a claims-made basis.

11.2.3. Fully Paid and Non-Assessable. All insurance obtained and maintained by the Owner pursuant to this Section 11.2 shall be fully paid for and non-assessable. However, such insurance policies may be subject to insurer audits.

11.2.4. City Option to Obtain Coverage. During the continuance of an Event of Default arising from the failure of the Owner to carry any insurance required by this Regulatory Agreement, the City may, at its option, purchase any such required insurance coverage and the City shall be entitled to immediate payment from the Owner of any premiums and associated reasonable costs paid by the City for such insurance coverage. Any amount becoming due and payable to the City under this Section 11.2.4 that is not paid within fifteen (15) calendar days after written demand from the City for payment of such amount, within an explanation of the amounts demanded, will bear interest from the date of the demand at the rate of eight percent (8%) per annum or the maximum interest rate allowed by applicable law, whichever is less. Any election by the City to purchase or not to purchase insurance otherwise required by the terms of this Regulatory Agreement to be carried by the Owner shall not relieve the Owner of its obligation to obtain and maintain any insurance coverage required by this Regulatory Agreement.

11.2.5. Separation of Insured. The Owner's Liability Insurance and Automobile Liability Insurance policies shall provide for separation of insured for the Owner and the City Parties. Insurance policies obtained in satisfaction of or in accordance with the requirements of this Regulatory Agreement may provide a cross-suits exclusion for suits between named insureds, but shall not exclude suits between named insureds and additional insureds.

11.2.6. Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions under insurance policies required by this Regulatory Agreement shall be declared to and approved by the City. The Owner shall pay all such deductibles or self-insured retentions regarding the City Parties or, alternatively, the insurer under each insurance policy required by this Section 11.2 shall eliminate such deductibles or self-insured retentions with respect to the City Parties.

11.2.7. No Separate Insurance. The Owner shall not carry separate or additional insurance concurrent in form or contributing in the event of loss with that required under this Regulatory Agreement, unless the City is made an additional insured thereon, as required by this Regulatory Agreement.

11.2.8. Insurance Independent of Indemnification. The insurance requirements of

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this Regulatory Agreement are independent of the Owner indemnification and other obligations under this Regulatory Agreement and shall not be construed or interpreted in any way to satisfy, restrict, limit, or modify the Owner's indemnification or other obligations or to limit the Owner's liability under this Regulatory Agreement, whether within, outside, or in excess of such coverage, and regardless of solvency or insolvency of the insurer that issues the coverage; nor shall the provision of such insurance preclude the City from taking such other actions as are available to it under any other provision of this Regulatory Agreement or otherwise at law or in equity.

11.2.9. Nature of Insurance. The policies of insurance required by this Regulatory Agreement shall be issued by carriers that: (a) are listed in the then current "Best's Key Rating Guide—Property/Casualty—United States & Canada" publication (or its equivalent, if such publication ceases to be published) with a minimum financial strength rating of "A-" and a minimum financial size category of "XI" (exception may be made for the California Compensation Insurance Fund when not specifically rated); and (b) are authorized to do business in California.

The Owner may provide any insurance under a "blanket" or "umbrella" insurance policy, provided that: (i) such policy or a certificate of such policy shall specify the amount(s) of the total insurance allocated to the Property and the Project, which amount(s) shall equal or exceed the amount(s) required by this Regulatory Agreement; and (ii) such policy otherwise complies with this Regulatory Agreement.

12. Maintenance of the Project. The Owner, for itself, its successors and assigns, hereby covenants and agrees that the exterior areas of the Project which are subject to public view (e.g.:
all paving, walkways, landscaping, and ornamentation) shall be maintained in good repair and in a neat, clean and orderly condition, ordinary wear and tear excepted. In the event that at any time during the Term, there is an occurrence of an adverse condition on any area of the Project which is subject to public view in contravention of the general maintenance standard described above ("Maintenance Deficiency"), then the City shall notify the Owner in writing of the Maintenance Deficiency and give the Owner thirty (30) calendar days from the date of such notice to cure the Maintenance Deficiency as identified in the notice. "Maintenance Deficiency" includes, without limitation, the following inadequate or non-conforming property maintenance conditions and/or breaches of residential property use restrictions: (i) failure to properly maintain the windows, structural elements, and painted exterior surface areas of the units in a clean and presentable manner; (ii) failure to keep the common areas of the Project free of accumulated debris, appliances, inoperable motor vehicles or motor vehicle parts, or free of storage of lumber, building materials or equipment not regularly in use on the Property; (iii) failure to regularly maintain, replace and renew the landscaping in a reasonable condition free of weed and debris; and (iv) the use of garage areas on the Project for purposes other than the parking of motor vehicles and the storage of personal possessions and mechanical equipment of persons residing in the Project.

12.1. In the event the Owner fails to cure or commence to cure the Maintenance Deficiency within the time allowed, the City may thereafter conduct a public hearing following transmittal of written notice thereof to the Owner ten (10) calendar days prior to the scheduled date of such public hearing in order to verify whether a Maintenance Deficiency exists and whether the Owner has failed to comply with the provision of this Section 12. If, upon the conclusion of a public hearing, the City makes a finding that a Maintenance Deficiency exists and that there appears to be non-compliance with the general maintenance standard, as described above, then the City shall have the right to enter the Project (exterior areas of the Project which are subject to

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public view only) and perform all acts necessary to cure the Maintenance Deficiency, or to take other action at law or equity that the City may then have to accomplish the abatement of the Maintenance Deficiency. Any sum expended by the City for the abatement of a Maintenance Deficiency as authorized by this Section 12.1 shall become a lien on the Project. If the amount of the lien is not paid within thirty (30) calendar days after written demand for payment by the City to the Owner, the City shall have the right to enforce the lien in the manner as provided in Section

12.3. 12.2. Graffiti which is visible from any public right-of-way which is adjacent or contiguous to the Project shall be removed by the Owner from any exterior surface of a structure or improvement on the Project by either painting over the evidence of such vandalism with a paint which has been color-matched to the surface on which the paint is applied, or graffiti may be removed with solvents, detergents or water as appropriate. In the event that graffiti is placed on the Project (exterior areas only) and such graffiti is visible from an adjacent or contiguous public right-of-way and thereafter such graffiti is not removed within three (3) business days following the time of its application, or the Owner's actual knowledge of its existence, whichever occurs later; then in such event and without notice to the Owner, the City shall have the right to enter the Project and remove the graffiti. Notwithstanding any provision of the Regulatory Agreement to the contrary, any sum expended by the City for the removal of graffiti from the Project as authorized by this Section 12.2 shall become a lien on the Project. If the amount of the lien is not paid within thirty (30) calendar days after written demand for payment by the City to the Owner, the City shall have the right to enforce its lien in the manner as provided in Section 12.3.

12.3. The parties hereto further mutually understand and agree that the rights conferred upon the City under this Section 12 expressly include the power to establish and enforce a lien or other encumbrance against the Property in the manner provided under California Civil Code Sections 2924, 2924b and 2924c, as such sections may be amended or superseded, in the amount as reasonably necessary to restore the Project to the maintenance standards required under this Section 12, including reasonable attorneys' fees and costs of the City associated with the abatement of the Maintenance Deficiency or removal of graffiti and the collection of the costs of the City in connection with such action. In any legal proceeding for enforcing such a lien against the Project, the prevailing party shall be entitled to recover its reasonable attorneys' fees and costs of suit. The provisions of this Section 12 shall be a covenant running with the land for the Term and shall be enforceable by the City in its discretion, cumulative with any other rights or powers granted to the City under applicable law. Nothing in the foregoing provisions of this Section 12 shall be deemed to preclude the Owner from making any alterations, additions, or other changes to any structure or improvement or landscaping on the Project, provided that such changes comply with the zoning and development regulations of the City and other applicable law. Notwithstanding anything to the contrary in this Section 12, City acknowledges and agrees that the priority of any such lien shall be deemed to be the date such lien is filed, and not the date this Regulatory Agreement is recorded.

12.4. Capital Replacement Reserve Account. The Owner shall establish an account for the payment of repair and replacement of capital items ("Capital Replacement Reserve Account") in an initial amount as required by the Institutional Lenders for the Project or the Tax Credit Investor. Each year thereafter, the Owner shall deposit into the Capital Replacement Reserve Account additional amounts as required by the Institutional Lenders for the Project or the

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Tax Credit Investor, but not less than Two Hundred Fifty Dollars ($250) per Unit per year.

12.4.1. Capital Repairs and Replacements. Capital repairs and replacements shall include, but not be limited to, the following: wet and dry utilities; roof repair and replacement as necessary; repair and replacement of boilers and the major operating components thereof; stucco repair and replacement; exterior painting; replacement of carpeting and vinyl or other hard surface flooring; replacement of drapes; replacement of dishwashers, garbage disposals and other interior appliances; repair and replacement of heating, ventilating and air conditioning systems, equipment and components; and installation of solar panels. All of the foregoing and other similar expenditures on the Project shall be considered to be qualifying capital repair and replacement expenses. Interior painting and servicing, repair or replacement of interior hardware shall not be considered to be a capital repair, but shall be ordinary operating expenses for the Project. The Owner shall withdraw funds from the Capital Replacement Reserve Account to pay such capital repair and replacement expenses as the Owner may deem necessary for the purposes of meeting the maintenance and replacement obligations described herein.

12.4.2. Insured Depository. The Capital Replacement Reserve Account shall be maintained in a depository insured by an agency of the federal government.

12.4.3. Documentation. Annually, or more frequently at the City's reasonable written request, the Owner shall document the level of capital repairs and replacements for the preceding period. The Owner shall maintain and shall provide as requested documentation showing the quantity and price of items purchased, price of materials and the cost of contracted labor or other services incurred in connection with such capital repair and replacement, and such other items as the City may reasonably request.

12.4.4. Withdrawals from Reserve Account. On an annual basis, the Owner shall notify the City of the anticipated cash requirements which will need to be withdrawn from the Capital Replacement Reserve Account. Amounts so budgeted and approved by the City (such approval not to be unreasonably withheld, conditioned or delayed) may be withdrawn by the Owner from the indicated Capital Replacement Reserve Account without further City approval.

Other withdrawals for unbudgeted, unanticipated or emergency Project expenditures may be withdrawn by the Owner without prior City approval, but the Owner shall notify the City in writing within ten (10) calendar days after withdrawal. All amounts so withdrawn by the Owner shall be expended on the Project and in accordance with this Regulatory Agreement. Withdrawals in excess of Twenty-Five Thousand Dollars ($25,000) in any one calendar year shall be pre-approved by the City in its reasonable discretion, subject to the rights of any Senior Lenders or the Tax Credit Investor.

12.4.5. Interest Earned on Funds in the Capital Replacement Reserve Account.

Any interest or other earnings from sums deposited into the Capital Replacement Reserve Account shall be retained in and added to the balance in said account.

12.4.6. Capital Needs Assessment. If requested in writing by the City, the Owner shall deliver to the City, for the City's reasonable review and approval, a capital needs assessment ("CNA") no more often than every ten (10) years after the date of the Certificate of Completion for the Project. The CNA shall include an analysis of the Owner's actual expenditures for capital

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needs compared to the most recently approved CNA, the Owner's original operating budget and its then-current operating budget. Each CNA shall include a ten (10) year capital needs assessment or analysis of replacement reserve requirements prepared by a qualified third party in accordance with reasonable and customary standards for similar residential rental projects.

12.4.7. Displacement of Residents and Relocation. The Owner shall make commercially reasonable efforts to conduct capital repairs and replacements and ordinary repair and maintenance (collectively, "Repairs") in a manner that does not result in the displacement of any of the residents of the Units. If any of the Owner's actions to conduct Repairs result in displacement of any of the Units' residents, the Owner shall notify the City in writing, prior to conducting such Repairs, of the identities of the residents to be displaced, the Units they will be displaced from, and the estimated length of time such residents shall be displaced. If the displacement of the residents triggers relocation obligations, the Owner shall be responsible, at its sole cost and expense, for any and all such relocation obligations and related expenses. The Owner shall comply with all applicable federal, state and local laws, rules and regulations regarding such relocation obligations and related expenses, including any relocation requirements set forth by the City. The Owner shall defend, indemnify and hold harmless the City Parties from and against all liability for any relocation obligations and related expenses attributable to any Repairs.

13. Covenants to Run with the Land. The Owner and the City hereby declare their specific intent that the covenants, reservations and restrictions set forth herein are part of a plan for the promotion and preservation of affordable housing within the territorial jurisdiction(s) of the City and that each shall be deemed covenants running with the land and shall pass to and be binding upon the Property and each successor-in-interest of the Owner in the Property for the Term. The Owner hereby expressly assumes the duty and obligation to perform each of the covenants and to honor each of the reservations and restrictions set forth in this Regulatory Agreement. Each and every contract, deed or other instrument hereafter executed covering or conveying the Property or any interest therein shall conclusively be held to have been executed, delivered and accepted subject to such covenants, reservations, and restrictions, regardless of whether such covenants, reservations and restrictions are set forth in such contract, deed or other instrument.

14. Burden and Benefit. The City and the Owner hereby declare their understanding and intent that the burden of the covenants set forth herein touch and concern the land in that the Owner's legal interest in the Property is affected by the affordable dwelling use and occupancy covenants hereunder. The City and the Owner hereby further declare their understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Property by the intended beneficiaries of such covenants, reservations and restrictions, and by furthering the affordable housing goals and objectives of the City and in order to make the Property available for acquisition by the Owner.

15. Defaults.

15.1. Events of Default. The occurrence of any of the following is a default and shall constitute a material breach of this Regulatory Agreement and, if not corrected, cured or remedied in the time period set forth in Section 15.2, shall constitute an "Event of Default" hereunder:

15.1.1. failure of the Owner or any person under its direction or control to comply

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with or perform when due any material term, obligation, covenant or condition contained in this Regulatory Agreement;

15.1.2. any warranty, representation or statement made or furnished to the City by the Owner under this Regulatory Agreement that is knowingly or intentionally false or misleading in any material respect either now or at the time made or furnished;

15.1.3. the dissolution or termination of the existence of the Owner as an ongoing business, insolvency, appointment of a receiver for any part of the Property, any assignment for the benefit of creditors, any type of creditor workout or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Owner; or

15.1.4. an Event of Default pursuant to the Affordable Housing Agreement.

15.2. Notice of Default. The City shall give written notice of default to the Owner, in accordance with Section 22, stating that such notice is a "Notice of Default", specifying the default complained of by the City and requiring the default to be remedied within thirty (30) calendar days of the date of the Notice of Default. Except as required to protect against further material damage, the City may not institute legal proceedings against the Owner until thirty (30) calendar days after providing the Notice of Default. Failure or delay in giving a Notice of Default shall not constitute a waiver of any default, nor shall it change the time of occurrence of the default. If the default specified in the Notice of Default is such that it is not reasonably capable of being cured within thirty (30) calendar days, and if the Owner initiates corrective action within said thirty (30) calendar day period and diligently works to effect a cure as soon as possible, then the Owner may have such additional time as authorized in writing by the City as reasonably necessary to complete the cure of the default prior to exercise of any other remedy for the occurrence of an Event of Default. Such authorization for additional time to cure shall not be unreasonably withheld, conditioned or delayed. The City shall give the Tax Credit Investor the following notice and cure rights:

15.2.1. The City will give the Tax Credit Investor a copy of any Notice (at the Tax Credit Investor’s address provided in a notice by the Owner to the City) that the City gives to the Owner under this Regulatory Agreement;

15.2.2. The City will give the Tax Credit Investor thirty (30) days after the date of such Notice to cure a non-payment of any sum due under this Regulatory Agreement;

15.2.3. The City will give the Tax Credit Investor sixty (60) days after the date of such Notice to cure any other default under this Regulatory Agreement;

15.2.4. If a non-monetary default is incapable of being cured within sixty (60) days, the City will give the Tax Credit Investor an additional ninety (90) days to cure such default provided the Tax Credit Investor has commenced to cure such default and is diligently proceeding to cure such default through the end of such period; and

15.2.5. If the Tax Credit Investor makes any such payment or otherwise cures such default, the City will accept such action as curing such default as if such payment or cure were made by the Owner.

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If the Owner and Tax Credit Investor fail to take corrective action relating to a default within thirty (30) calendar days following the date of Notice of Default (or to complete the cure within the additional time as may be authorized by the City or set forth above for the Tax Credit Investor), an Event of Default shall be deemed to have occurred.

15.3. Inaction Not a Waiver of Default. Any failure or delays by the City 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. Delays by the City in asserting any of its rights and remedies shall not deprive the City of its right to institute and maintain any actions or proceedings which it may reasonably deem necessary to protect, assert or enforce any such rights or remedies.

16. Remedies. Upon the occurrence of an Event of Default, the City shall, in addition to the remedial provisions of Section 12 as related to a Maintenance Deficiency at the Property, be entitled to seek any appropriate remedy or damages by initiating legal proceedings as follows: (i) by mandamus or other suit, action or proceeding at law or in equity, to require the Owner to perform its obligations and covenants hereunder, or enjoin any acts or things which may be unlawful or in violation of the rights of the City; or (ii) by other action at law or in equity as necessary or convenient to enforce the obligations, covenants and Agreements of the Owner to the City.

16.1. Rights and Remedies are Cumulative. The rights and remedies of the City as set forth in this Section 16 are cumulative and the exercise by the City 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 Owner.

16.2. Enforcement by Third Parties. No third party shall have any right or power to enforce any provision of this Regulatory Agreement on behalf of the City or to compel the City to enforce any provision of this Regulatory Agreement against the Owner or the Project.

17. Governing Law. This Regulatory Agreement shall be governed by the laws of the State of California and applicable federal laws, without regard to conflicts of laws principles.

18. Amendment. This Regulatory Agreement may be amended after its recordation only by a written instrument executed by the Owner and the City.

19. Attorney's Fees. In the event that a party to this Regulatory Agreement brings an action to enforce any condition or covenant, representation or warranty in this Regulatory Agreement or otherwise arising out of this Regulatory Agreement, the prevailing party(ies) in such action shall be entitled to recover from the other party reasonable attorneys' fees to be fixed by the court in which a judgment is entered, as well as the costs of such suit.

20. Severability. If any provision of this Regulatory Agreement shall be declared invalid, inoperative or unenforceable by a final judgment or decree of a court of competent jurisdiction such invalidity or unenforceability of such provision shall not affect the remaining parts of this Regulatory Agreement which are hereby declared by the parties to be severable from any other part which is found by a court to be invalid or unenforceable.

21. Time is of the Essence. For each provision of this Regulatory Agreement which states a

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specific amount of time within which the requirements thereof are to be satisfied, time shall be deemed to be of the essence.

22. Notices, Demands and Communications Between the Parties. Any and all notices submitted by any party to another party pursuant to or as required by this Regulatory Agreement shall be dispatched by messenger for immediate personal delivery, or by registered or certified United States mail, postage prepaid, return receipt requested, to the address of the party, as set forth in this Section. Such notice may be sent in the same manner to such other addresses as any [arty may from time to time designate by notice. Any notice shall be deemed to be received by the addressee, regardless of whether or when any return receipt is received by the sender or the date set forth on such return receipt, on the day that it is dispatched by messenger for immediate personal delivery, or two (2) calendar days after it is placed in the United States mail, as provided in this Section. Rejection, other refusal to accept or the inability to deliver any notice because of a changed address of which no notice was given or other action by a person or entity to whom notice is sent, shall be deemed receipt of the notice.

The following are the authorized addresses for the submission of notices to the parties, as of the date of this Regulatory Agreement:

To the Owner: Montebello Affordable Housing, LP
c/o Cesar Chavez Foundation
29700 Woodford Tehachapi Road
Keene, CA 93531
Attention: Paul S. Park
(T) 213-362-0260 (Ext 2261)
(F) 855-897-1429
With copies to Rutan & Tucker, LLP
18575 Jamboree Road, 9th Floor
Irvine, CA 92612
Attention: Patrick D. McCalla
(T) 714-641-5100
(F) 714-546-9035
and to:

To the City:

With copies to: __________________
__________________
___________________

23. Recording. The parties hereto shall cause this Regulatory Agreement to be recorded in the official records of the County of Los Angeles.

24. No Third Party Beneficiary. No claim as a third-party beneficiary under this Regulatory Agreement by any person, corporation or any other entity, shall be made or be valid against the

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City or the Owner.

25. Prohibition Against Transfer.

25.1. Except as expressly provided in the Affordable Housing Agreement, the Owner shall not, without prior written approval of the City, which may not be unreasonably withheld, delayed or conditioned: (i) assign or attempt to assign this Regulatory Agreement or any right herein; or (ii) make any total or partial sale, transfer, conveyance, lease, leaseback, or assignment of the whole or any part of the Property or the improvements thereon, with the exception of leases of the residential units as permitted by this Regulatory Agreement, or permit to be placed on any of the Property any unauthorized mortgage, trust deed, deed of trust, encumbrance or lien.

25.2. In the absence of specific written agreement or approval by the City, and except as expressly provided in the Affordable Housing Agreement, no unauthorized sale, transfer, conveyance, lease, leaseback or assignment of the Property shall be deemed to relieve the Owner or any other party from any obligations under this Regulatory Agreement.

26. City Approvals and Actions. The City Manager shall have the authority to make approvals, issue interpretations, waive provisions, grant extensions of time, approve amendments to this Regulatory Agreement and execute documents on behalf of the City (to the extent not provided otherwise in this Regulatory Agreement), including, without limitation, any documents necessary to implement any changes in the number or affordability of the Qualifying Units, as may be required by TCAC or to maintain the fiscal integrity of the Project, so long as such actions do not reduce the length of affordability of the Qualifying Units or add to the costs incurred or to be incurred by the City as specified herein. The City Manager reserves the right, in his or her sole and absolute discretion, to submit any requested modification, interpretation, amendment or waiver to the City Council if the City Manager determines or believes that such action could increase the risk, liability or costs to the City, or reduce the length of affordability of the Project.

IN WITNESS WHEREOF, the Owner and the City have caused this Regulatory Agreement to be signed, acknowledged and attested on their behalf by duly authorized representatives in counterpart original copies which shall upon execution by all of the parties be deemed to be one original document.
[Signatures on following pages]

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CITY SIGNATURE PAGE
TO

REGULATORY AGREEMENT
CITY:

CITY OF MONTEBELLO,
a California municipal corporation
By: Date:
________________
City Manager
ATTEST:

City Clerk

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OWNER SIGNATURE PAGE
TO

REGULATORY AGREEMENT
OWNER:

MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership [to be inserted]
By: _______________________
,
its __________________

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ATTACHMENT NO. 1
TO

REGULATORY AGREEMENT
(6th Street Grand, Montebello Phase 1)
Project Site Legal Description
All that certain real property situated in the County of Los Angeles, State of California, described as follows:

PARCEL 1:

LOT 19 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK (BEING A SUBDIVISION OF

CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE SOUTHWEST 88 FEET OF SAID LOT.

ALSO EXCEPT ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395 PAGE 381, OFFICIAL RECORDS.

PARCEL 2:

LOT 20 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK, IN THE CITY OF

MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO) AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM THE SOUTH 36 FEET OF THE NORTH 44 FEET OF THE WEST 115 FEET THEREOF.

PARCEL 3:

THE SOUTHERLY 36 FEET OF THE NORTHERLY 44 FEET OF THE WESTERLY 115 FEET OF LOT 20 OF THE ADDITION NO. 1, TO THE TOWN OF NEWMARK (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO,

COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM FROM PARCELS 2 AND 3 ABOVE ONE-HALF OF ALL OIL, GAS,

PETROLEUM, ASPHALTUM AND OTHER HYDROCARBON SUBSTANCES AND OTHER

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MINERALS, PRODUCED FROM THE PREMISES, AS EXCEPTED IN THE DEED FROM HENRY M. NEWMARK AND MARIE LOUISE NEWMARK, HIS WIFE, AND ROSE N.

SUTRO AND ALFRED SUTRO, HER HUSBAND, RECORDED IN BOOK 6771 PAGE 81 OF OFFICIAL RECORDS OF SAID COUNTY.

PARCEL 4:

THE SOUTHERLY 44 FEET OF LOT 19 OF THE ADDITION NO. 1, TO THE TOWN OF

NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM AN INTEREST IN ALL OIL, OIL RIGHTS, NATURAL GAS

RIGHTS, MINERAL RIGHTS, ALL OTHER HYDROCARBON SUBSTANCES BY

WHATSOEVER NAME KNOWN, AND ALL RIGHTS THERETO, WITHOUT HOWEVER,

ANY RIGHT TO ENTER UPON THE SURFACE OF SAID LAND NOR ANY PORTION OF

THE SUBSURFACE, AS EXCEPTED OR RESERVED BY DEED RECORDED IN BOOK 7395, PAGE 381, OFFICIAL RECORDS.

PARCEL 5:

THE SOUTHWESTERLY 44 FEET OF THE NORTHEASTERLY 88 FEET OF LOT 19 OF ADDITION NO. 1, TOWN OF NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395, PAGE 381, OF OFFICIAL RECORDS.

APN: 6349-005-900, 901, 902 (Parcels 1-3) and 903 (Parcel 4) APN: 6349-005-006 (Parcel 5)

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ATTACHMENT NO. 2
TO

REGULATORY AGREEMENT
Certification of Tenant Eligibility
6th Street Grand, Montebello Phase 1
NOTE TO PROPERTY OWNER: This form is designed to assist you in computing Annual Income.

Re: 6th Street Grand, Montebello Phase 1, Montebello, California I/We, the undersigned, state that I/we have read and answered fully, frankly and personally each of the following questions for all persons who are to occupy the unit being applied for in the property listed above. Listed below are the names of all persons who intend to reside in the unit:

1. 2. 3. 4. 5.

Names of
Members of
Household
Relationship
to Head of
Household Age
Social
Security
Number
Place of
Employment

6. Head of Household (check one):

Mother: ____
Father: ____
Other: _____________ (specify relationship – i.e. legal guardian, sister, brother, etc.) Income Computation

7. The total anticipated income, calculated in accordance with the provisions of this Section 7, of all persons over the age of 18 years listed above for the 12-month period beginning the date that I/we plan to move into a unit is $ ____________________.

Included in the total anticipated income listed above are:
(a) all wages and salaries, overtime pay, commissions, fees, tips and bonuses and other compensation for personal services, before payroll deductions; (b) the net income from the operation of a business or profession or from the rental of real or personal property (without deducting expenditures for business expansion or amortization of capital indebtedness or any allowance for depreciation of capital assets);

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(c) interest and dividends (including income from assets excluded below); (d) the full amount of periodic payments received from social security, annuities, insurance policies, retirement funds, pensions, disability or death benefits and other similar types of period receipts, including any lump sum payment for the delayed start of a periodic payment; (e) payments in lieu of earnings, such as unemployment and disability compensation, workmen's compensation and severance pay;
(f) the maximum amount of public assistance available to the above persons other than the amount of any assistance specifically designated for shelter and utilities; (g) periodic and determinable allowances, such as alimony and child support payments and regular contributions and gifts received from persons not residing in the dwelling; (h) all regular pay, special pay and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is the head of the household or spouse; and (i) any earned income tax credit to the extent that it exceeds income tax liability.

Excluded from such anticipated income are:
(a) casual, sporadic or irregular gifts;
(b) amounts which are specifically for or in reimbursement of medical expenses (c) lump sum additions to family assets, such as inheritances, insurance payments (including payments under health and accident insurance and workmen's compensation), capital gains and settlement for personal or property losses;
(d) amounts of educational scholarship paid directly to the student of the educational institution, and amounts paid by the government to a veteran for use in meeting the costs of tuition, fees, book and equipment. Any amounts of such scholarships, or payments to veterans not used for the above purposes, are to be included in income;
(e) special pay to a household member who is away from home and exposed to hostile fire;
(f) relocation payments under Title 11 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970;
(g) foster child care payments;
(h) the value of coupon allotments for the purchase of food pursuant to the Food Stamp Act of 1977;
(i) payments to volunteers under the Domestic Volunteer Service Act of 1973; payments received under the Alaska Native Claims Settlement Act.

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(j) income derived from certain submarginal land of the United States that is held in trust for certain Indian tribes;
(k) payments or allowances made under the Department of Health and Human Services' Low-Income Home Energy Assistance Program;
(l) payments received from the Job Training Partnership Act; (m) the first $2,000 of per capita shares received from judgment funds awarded by the Indian Claims Commission or the Court of Claims.

8. Do the persons whose income or contributions are included in item 6 above:
(a) have savings, stocks, bonds, equity in real property or other form of capital investment (excluding the values of necessary items of personal property such as furniture and automobiles and interests in Indian trust land)? ___ Yes ____ No; or (b) have they disposed of any assets (other than at a foreclosure or bankruptcy sale) during the last two years at less than fair market value? ___Yes ___No (c) If the answer to (a) or (b) above is yes, does the combined total value of all such assets owned or disposed of by all such persons total more than $5,000? ___Yes ___No (d) If the answer to (c) is yes, state:
(i) the amount of income expected to be derived from such assets in the 12- month period beginning on the date of initial occupancy in the unit that you propose to rent:
$______; and
(ii) the amount of such income, if any, that was included in item 6 above:
$______

9. (e) Are all of the individuals who propose to reside in the unit full-time students*? ____Yes ____No
*A full-time student is an individual enrolled as a full-time student during each of five calendar months during the calendar year in which occupancy of the unit begins at an educational organization which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance and is not an individual pursuing a full-time

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course of institutional or farm training under the supervision of an accredited agent of such an educational organization or of a state or political subdivision thereof. (f) If the answer to 8(a) is yes, is at least one of the proposed occupants of the unit a husband and wife entitled to file a joint federal income tax return? ____Yes ____No

10. Neither myself nor any other occupant of the unit I/we propose to rent is the Owner of the property in which the unit is located (hereinafter the "Owner"), has any family relationship to the Owner or owns, directly or indirectly, any interest in the Ownership. For purposes of this section, indirect the Ownership by an individual shall mean the Ownership by a family member, the Ownership by a corporation, partnership, estate or trust in proportion to the Ownership or beneficial interest in such corporation, partnership, estate or trust held by the individual or a family member, and the Ownership, direct or indirect, by a partner of the individual.

11. This certificate is made with the knowledge that it will be relied upon by the Owner to determine maximum income for eligibility to occupy the unit; and I/we declare that all information set forth herein is true, correct and complete and, based upon information I/we deem reliable and that the statement of total anticipated income contained in Section 7 is reasonable and based upon such investigation as the undersigned deemed necessary.

12. I/we will assist the Owner in obtaining any information or documents required to verify the statements made herein, including either an income verification from my/our present employer(s) or copies of federal tax returns for the immediately preceding calendar year.

13. I/we acknowledge that I/we have been advised that the making of any misrepresentation or misstatement in this declaration will constitute a material breach of my/our agreement with the Owner to lease the units and will entitle the Owner to prevent or terminate my/our occupancy of the unit by institution of an action for eviction or other appropriate proceedings.

14. Housing Issuer Statistical Information (Optional--will be used for reporting purposes only):

Marital Status: _____________________________
Race (Head of Household)
White ________ Asian ________ Hispanic ________
African-American ________ Native American ________ Other ________ Physical Disability: Yes ________ No ________
[signature on following page]

30 Exhibit J
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I/we declare under penalty of perjury that the foregoing is true and correct.

Executed this ________ day of__________, ____ in the County of Los Angeles, California. ____________________________________
Applicant
____________________________________
Applicant
[Signature of all persons over the age of 18 years listed in number 2 above required]

31 Exhibit J
1603\46\2864071.5
FOR COMPLETION BY PROPERTY THE OWNER ONLY:

1. Calculation of eligible income:
(a) Enter amount entered for entire household in 6 above: $______________ (b) (1) If answer to 7(c) above is yes, enter the total amount entered in 7(d)(1), subtract from that figure the amount entered in 7(d)(2) and enter the remaining balance ($_______________);
(2) Multiply the amount entered in 7(c) times the current passbook savings rate to determine what the total annual earnings on the amount in 7(c) would be if invested in passbook savings ($________), subtract from that figure the amount entered in 7(d)(2) and enter the remaining balance
(3) Enter at right the greater of the amount calculated under (1) or (2) above:
$_____________;
(c) TOTAL ELIGIBLE INCOME
(Line l(a) plus line 1(b)(3): $________________

2. The amount entered in l(c):
_____ Qualifies the applicant(s) as a Qualified Household. _____ Does not qualify the applicant(s) as Qualified Household.

3. Apartment unit assigned:

Bedroom Size: ______ Rent: $________

4. This apartment unit [was/was not] last occupied for a period of 31 consecutive days by persons whose aggregate anticipated annual income, as certified in the above manner upon their initial occupancy of the apartment unit, qualified them as a Qualified Household.

5. Method used to verify applicant(s) income:
_____ Employer income verification.
_____ Copies of tax returns.
_____ Other (_____________________)
_________________________________
Manager

32 Exhibit J
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The undersigned employee has applied for a rental unit located in a project financed in part by the City of Montebello for persons of very low income. Every income statement of a prospective tenant must be stringently verified. Please indicate below the employee's current annual income from wages, overtime, bonuses, commissions or any other form of compensation received on a regular basis.

Annual wages ________ Overtime ________ Bonuses ________ Commissions ________
Total current income ____________
I hereby certify that the statements above are true and complete to the best of my knowledge. _____________________________ _______________ ______________________________ Signature Date Title
I hereby grant you permission to disclose my income to ____________________________ in order that they may determine my income eligibility for rental of an apartment at [_____________________].
_____________________________ _______________
Signature Date
Please send to: ________________________________________ ________________________________________
________________________________________
I hereby attach copies of my individual federal and state income tax returns for the immediately preceding calendar year and certify that the information shown in such income tax returns is true and complete to the best of my knowledge.
_____________________________ _______________
Signature Date

33 Exhibit J
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ATTACHMENT NO. 3
TO

REGULATORY AGREEMENT
(6th Street Grand, Montebello Phase 1)
Certificate of Continuing Program Compliance
For Annual Reporting Period Ending
The undersigned, _______________, as the authorized representative of Montebello Affordable Housing, LP, a California limited partnership ("Owner"), has read and is thoroughly familiar with the provisions of the various documents associated with the financial assistance provided by the City of Montebello ("City"), as established in numerous documents including the Regulatory Agreement, dated as of March __, 2023, between the Owner and the City.

As of the date of this Certificate, the following percentage of residential units in the Project are (i) occupied by Qualified Households (as such term is defined in the Regulatory Agreement) or (ii) are currently vacant and being held available for such occupancy and have been so held continuously since the date a Qualified Household vacated such unit, as indicated:

Number of Units occupied by Qualified Households: ________________ Number of Vacant Units: ________________
Number of Qualified Households who commenced
occupancy during the preceding reporting period: ________________

Attached is a separate sheet ("Occupancy Summary") listing, among other items, the appropriate information for each residential unit in the Project, the occupants of each unit and the rent paid for each unit. The information contained thereon is true and accurate and reasonable and is based on information submitted to the Owner and is certified under penalty of perjury by each tenant. [Signatures on following page]

34 Exhibit J
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The undersigned hereby certifies that (1) a review of the activities of the Owner during such reporting period and of the Owner's performance under the Regulatory Agreement has been made under the supervision of the undersigned; and (2) to the best of the knowledge of the undersigned, based on the review described in clause (1) hereof, the Owner is not in default under any of the terms and provisions of the above documents.

Dated: ______________________ OWNER
__________________
By: ______________________________
Name: _______________________________
Its: _________________________________

35 Exhibit J
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OCCUPANCY SUMMARY
Total Number of Units in the Project: ___________
Total Units occupied by Qualified Households: ___________ Total Units available for rent to Qualified Households: ___________ ATTACHED IS THE FOLLOWING INFORMATION:

A. Resident and rental information on each occupied apartment in the complex.

B. Certification of Tenant Eligibility for all Qualified Households who have moved into ________________, Montebello, California, since the filing of the last Occupancy Summary. The same are true and correct to the best of the undersigned's knowledge and belief.

Dated: ______________________ OWNER:
______________________
By: ____________________________________
Name: _______________________________
Its: _________________________________

1 Exhibit K
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EXHIBIT K
Form of Land Note
(see attached)

1 Exhibit K
1603\46\2864071.5

LAND PROMISSORY NOTE SECURED BY DEED OF TRUST
(6th Street Grand, Montebello Phase 1)
Principal Amount: $3,075,000 Date of Note: ______, 2023 Maker: MONTEBELLO
AFFORDABLE HOUSING, LP, a
California limited partnership
Lender: CITY OF MONTEBELLO, a
municipal corporation
Maturity Date: Fifty-five (55) years
from the date on which the Construction
Financing converts to the Permanent
Loan
Interest Rate: Three Percent (3%)

1. Land Loan.

FOR VALUE RECEIVED, the undersigned MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership ("Maker"), with its principal place of business located at 29700 Woodford Tehachapi Road, Keene, CA 93531, promises to pay to the CITY OF MONTEBELLO, a California municipal corporation (the "City" or "Holder") at 1600 West Beverly Blvd., Montebello, California, or such place as the Holder may, from time to time, designate by written notice to the Maker, the principal sum of THREE MILLION SEVENTY- FIVE THOUSAND DOLLARS ($3,075,000), (the "Land Loan"), together with any accrued interest, if applicable, as set forth in this Note. This Promissory Note (the "Note") is made and given pursuant to that certain Purchase, Sale, and Affordable Housing Development Agreement (6th Street Grand, Montebello Phase 1) between the City and Maker's predecessor-in-interest, dated ___________, 2023 (the "Affordable Housing Agreement"). The Affordable Housing Agreement is incorporated herein by this reference. All initially capitalized terms used but not defined herein shall have the meanings given to them in the Affordable Housing Agreement. The Land Loan is made for the conveyance of the City Properties by City to Maker in accordance with the terms and conditions of the Affordable Housing Agreement.

2. Term of Loan and Right of Prepayment.
a. Maturity Date. All accrued interest, if any, and principal shall be due and payable in full without any further demand or notice fifty-five (55) years from the date on which the Construction Financing converts to the Permanent Loan ("Maturity Date"). b. Prepayment. This Note may be prepaid in whole or in part at any time and from time to time without penalty or premium.

3. Security for Note.

This Note is secured by a Deed of Trust executed by Maker which creates a lien on that certain real property as described therein and in the Affordable Housing Agreement.

2 Exhibit K
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4. Interest Calculation.

The principal outstanding under this Note shall accrue simple interest at the rate of three percent (3%) per annum, except in the case of Default as set forth in Section 9 of this Note.

Principal and interest shall be payable in lawful money of the United States of America. If applicable, interest shall be computed based on an actual day year and the actual number of days elapsed. Interest shall commence on amounts disbursed hereunder from the date of disbursement.

5. Annual Payment.

Following completion of the Project as evidenced by the issuance by the City of a Certificate of Completion as set forth in the Affordable Housing Agreement, and continuing each year thereafter until the Maturity Date, a portion of the Residual Receipts (as defined below) from the Project shall be paid to Holder and applied to pay down the amounts due and owing under this Note. The payments described below shall be paid to Holder no later than September 1 each year, with the first payment due on the September 1 following the issuance of a Certificate of Occupancy for the Project, and continuing each year thereafter.
a. Annual Payments from Residual Receipts. Maker shall make repayments of the outstanding principal and accrued interest, if any, equal to the City's Land Percentage of Fifty Percent (50%) of the Residual Receipts from the Project as repayment of amounts due and owing under this Note. For the purposes of this Note, "City's Land Percentage" means the percentage calculated by dividing (1) the original principal amount of the Land Loan actually disbursed to Borrower by (2) the sum of Total Assistance from all other government entities obtained by the Borrower, to the extent not requiring a mandatory debt service payment. "Total Assistance" means the collective sum of (i) the original principal amount of the Impact Loan, and (ii) the original principal amounts of loans made by the other government entities which are required to be repaid utilizing Residual Receipts.

Such annual payments shall be accompanied by the Maker's report of Residual Receipts. The Maker shall provide the Holder with the audited financial statement provided for in Section 6, and any other documentation reasonably requested by Holder to substantiate the Maker's determination of Residual Receipts.

All payments made hereunder shall be credited first to any accrued but unpaid interest (if applicable), then to current interest due and owing and lastly to principal.

Notwithstanding the foregoing, the entire outstanding balance of principal and any interest owing under this Note shall be due and payable in full on the Maturity Date.

Prior to any sale of all or any portion of the Project, or Refinancing of all or any portion of the outstanding debt from the Project, and so long as there is any outstanding amount due and owing under this Note, Maker shall notify Holder of any such proposed or intended sale or Refinancing. In such event, Maker and Holder shall meet and confer, and shall use good faith efforts, to determine the feasibility of the payoff or restructuring of the remaining balance owing under this Note as part of any such sale or Refinancing to provide for repayment of this Note sooner than the fifty-five (55) year repayment period.

3 Exhibit K
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b. Definition of Residual Receipts. For the purposes of this Note, "Residual Receipts" shall mean the sum of money computed as follows:
(i) All rents, revenues, consideration or income (of any form) received by Maker in connection with or relating to the ownership or operation of the Project, including the City’s Impact Fee Percentage of any net revenue derived from any Refinancing of the Project which is not required to meet current or future Project obligations (but excluding tenants' security deposits, partner capital contributions and similar advances or interest that is earned on and allocated to reserve accounts) ("Gross Revenue") less all of the following: all customary and reasonable costs (i.e., mandatory (hard) mortgage payments) and expenses reasonably and actually incurred in connection with the operation and maintenance of the Project, including but not limited to premiums for property and liability insurance; utility services not paid directly by tenants; maintenance and repair; security services and payments for social/supportive services; any adjuster payments to the investor limited partner required under Maker's partnership agreement; payment of principal or interest on any indebtedness of Maker to any affiliate of Maker (individual or entity) or partner of Maker to repay completion, operating deficit or other loans relating to the Project; asset management fee payable to the limited partner of Maker in an amount approved as part of the Project Budget (as defined in the Affordable Housing Agreement), increased annually by three percent (3%); partnership management fee payable to Maker, not to exceed the amount approved as part of the Project Budget (as defined in the Affordable Housing Agreement), increased annually by three percent (3%); reasonable property management fees not to exceed Sixty-Five Dollars ($65) per unit per year, increased annually by three and one-half percent (3.5%); deferred developer fee in an amount approved as part of the Project Budget (as defined in the Affordable Housing Agreement); amounts (reasonably approved by Holder) expended to restore the Project after a casualty loss or condemnation; reasonable and customary professional fees for legal, accounting, audit and tax returns for Maker and the Project, and similar customary expenses; taxes; franchise tax filing fees; and any cash deposited into replacement and operating reserves in amounts reasonably required by the investor or the lenders for the Project (collectively "Operating Expenses").
(ii) Notwithstanding the generality of the foregoing, the following items are not expenses or deductible in computing Residual Receipts: depreciation, cost recovery, amortization and similar items which do not involve the expenditure of cash.

6. Audited Financial Statement.

Maker shall annually provide Holder with an audited financial statement documenting the calculation of Residual Receipts for the previous calendar year ending December 31. The audited financial statement shall be provided on or before September 1, together with payment of the Residual Receipts payment due to Holder. Holder shall have the right to inspect and audit Maker's books and records concerning the calculation of the Residual Receipts Payment and to object within ninety (90) days from receipt of Maker's statement. Failure to timely object shall be deemed acceptance. If Holder does object, Holder shall specify the reasons for disapproval. Maker shall have thirty (30) days to reconcile any disapproved item. If Maker and Holder cannot agree on the amount of the Residual Receipts payment, an independent auditor mutually selected by Maker and Holder shall resolve any disputed items. If the independent auditor determines that Maker’s statement underreported the amount of the Residual Receipts by more than three percent (3%), the

4 Exhibit K
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cost of the auditor shall be paid solely by Maker. If the independent auditor determines that Maker’s statement did not underreport the amount of the Residual Receipts, the cost of the auditor shall be paid solely by Holder. Except in the event that Maker or Holder are solely responsible for the costs of the auditor pursuant to one of the foregoing sentences, the cost of the auditor shall be shared equally by Maker and Holder.

7. Annual Budget.

Maker shall prepare and submit to Holder a proposed annual operating budget for the management and operation of the Project ("Annual Budget") no later than 15 days preceding the effective year of such budget. The Annual Budget shall include the projected Gross Revenue and Operating Expenses for the year and a line item showing the projected Residual Receipts from the Project for the year. Holder will review the Annual Budget and, if acceptable, approve it, which approval shall not be unreasonably withheld. If the Annual Budget is not acceptable, Holder shall specify the reasons for disapproval. The intent of this section is to provide Holder an opportunity to disapprove any unreasonable expenses which would diminish the Residual Receipts from the Project. Once approved, any changes to the Annual Budget which exceed ten percent (10%) of the total Annual Budget shall require Holder's prior written consent, which consent shall not be unreasonably withheld.

8. Acceleration Upon Certain Events or Upon Event of Default.

On the occurrence of an Event of any Default under the terms of this Note, the Affordable Housing Agreement or the Regulatory Agreement, the Deed of Trust which is the security for this Note, or under any Senior loans, notes or deeds of trust, at the option of the Holder and after notice to the Maker, providing Maker with thirty (30) days in which to cure any Event of Default, and such Event of Default not having been cured within thirty (30) days (or if a greater amount of time is reasonably necessary to effect a cure, if actions to cure such Event of Default are not undertaken within said thirty (30) day period and pursued with reasonable diligence thereafter), all principal and interest due under this Note shall immediately become due and payable, upon thirty (30) day written notice from the Holder to the Maker. Failure to exercise such option shall not constitute a waiver of the right to exercise it in the event of any subsequent Event of Default.

Should the undersigned Maker agree to or sell, convey, transfer, or dispose of the real property described in the Deed of Trust securing this Note or any part thereof or interest therein, without first obtaining the prior written consent of the Holder (except for a Permitted Transfer, as defined in the Affordable Housing Agreement), then, at the option of the Holder, all principal and interest due hereunder shall immediately become due and payable upon thirty (30) days written notice from the Holder to the Maker. Consent to one transaction of this type will not constitute a waiver of the right to require consent to future or successive transactions.

Notwithstanding the generality of the foregoing, certain transfers permitted under the Affordable Housing Agreement shall not constitute an Event of Default hereunder or under the Affordable Housing Agreement, and any such action shall not accelerate the maturity of this Promissory Note, provided that any transfer is either a Permitted Transfer as defined in the Affordable Housing Agreement or is reasonably acceptable to the City with reasonable

5 Exhibit K
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promptness, and any transferee under such a transfer agrees to be bound by any and all instruments in favor of the City.

9. Interest on Event of Default.

From and after an Event of Default, the entire outstanding principal balance of this Note shall automatically bear an annual interest rate equal to the lesser of: (a) eight percent (8%) compounding annually; or (b) the maximum interest rate allowed by law.

10. Costs Paid by Maker.

Maker agrees to pay the following costs, expenses and attorneys fees paid or incurred by the Holder of this Note, or as adjudged by a court of competent jurisdiction: (a) reasonable costs of collection, costs and expenses and attorneys fees paid or incurred in connection with the collection or enforcement of this Note, whether or not suit is filed; and (b) costs of suit in such sum as the court may adjudge reasonable as attorneys fees in any action to enforce payment of this instrument.

11. Waiver.

Maker hereby waives diligence, presentment, protest and demand, notice of protest, dishonor and nonpayment of this instrument, and expressly agrees that, without in any way affecting the liability of Maker hereunder, the Holder hereof may extend the Maturity Date or the time for payment of any installment due hereunder, accept additional security, release any party liable hereunder or release any security now or hereafter securing this Note. Maker hereby waives, to the fullest extent permitted by law, the right to plead any and all statutes of limitations as a defense to any demand on this instrument or any deed of trust, security agreement, guarantee or other agreement now or hereafter securing this Note.

12. Indemnification.

Maker shall indemnify, defend, protect and hold the City harmless from and against any and all loss, damage, liability, action, cause of action, cost or expense, including, without limitation, reasonable attorneys fees and expenses incurred by the Holder hereof, arising as a result of any (i) fraud or intentional material misrepresentation by the Maker under or in connection with the Affordable Housing Agreement or related agreements; (ii) intentional bad faith waste of the real property encumbered by the deed of trust which secures this Note; and (iii) losses resulting from Maker's failure to maintain insurance as required under the provisions of the deed of trust securing this Note and the Affordable Housing Agreement.

13. Nonrecourse.

This Note is a nonrecourse obligation of Maker and Maker’s partners, and the Holder must resort only to the Project or the Property, or both, for repayment should the Maker fail to repay the sums evidenced hereby. Neither Maker nor any of its general or limited partners shall have any personal liability for repayment of the Land Loan and no deficiency judgment may be obtained against Maker or any of its general or limited partners except for actual or constructive fraud, intentional material misrepresentation, intentional bad faith waste of or on the Project and such

6 Exhibit K
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other matters as are referred to below. Notwithstanding the generality of the foregoing, however, Maker shall indemnify, defend, protect and hold Holder harmless from and against any and all loss, damage, liability, action, cause of action, cost or expense, including, without limitation, reasonable attorneys' fees and expenses incurred by the Holder arising as a result of any (i) fraud or intentional material misrepresentation by the Maker under or in connection with the Affordable Housing Agreement or any other agreements or documents provided in connection therewith; (ii) intentional bad faith waste of the Property encumbered by the deed of trust which secures this Note; and (iii) losses resulting from Maker's failure to maintain insurance as required under the provisions of the deed of trust securing this Note. Maker's obligation to indemnify the Holder hereof as aforesaid shall be recourse obligations of the Maker, and in the event of any breach of such obligations, the Holder shall have the right to proceed directly against the Maker to recover any and all losses, damages, liability, costs and expenses (including without limitation, reasonable attorneys' fees and expenses) and may bring any action and institute any proceeding to obtain a deficiency judgment in or following foreclosure for any and all such losses, damages, liabilities, costs and expenses resulting from such breach.

14. Severability.

If any provision of this Note is determined by a court of competent jurisdiction to be void or unenforceable, such determination shall not affect any other provision of this instrument, and all other provisions hereof shall remain valid and in full force and effect.

15. Non-Waiver.

No delay in demanding or failure to demand performance hereunder shall constitute a waiver by the Holder hereof of its right to subsequently demand such performance or to exercise any remedies for any Event of Default hereunder. Further, in order to be effective, any waiver of any of the Holder's rights and remedies hereunder shall be expressed in a writing signed by a duly appointed representative of the Holder hereof. Further, waiver by the Holder hereof of any right hereunder shall not constitute a waiver of any other right, including, but not limited to, the right to exercise any and all remedies for a different or subsequent Event of Default hereunder. [Signatures on Following Page]

7 Exhibit K
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MAKER:

MONTEBELLO AFFORDABLE HOUSING, LP,
a California limited partnership
[to be inserted]
By: ___________________,
,
its managing general partner

1 Exhibit L
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EXHIBIT L
Form of City Loan Deed of Trust
(see attached)

1 Exhibit L
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RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:

City of Montebello
1600 West Beverly Boulevard
Montebello, California 90640
Attn: City Manager
APN: _______________ SPACE ABOVE FOR RECORDER'S USE ONLY

EXEMPT FROM RECORDING FEE PER
GOVERNMENT CODE §27383

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
(WITH ASSIGNMENT OF RENTS)
(6th Street Grand, Montebello Phase 1)
This Deed of Trust, Security Agreement and Fixture Filing (with Assignment of Rents) ("Deed of Trust") is dated as of March __, 2023, by MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership, whose address is 29700 Woodford Tehachapi Road, Keene, CA 93531 ("Trustor"), to COMMONWEALTH LAND TITLE COMPANY, a California corporation ("Trustee"), for the benefit of the CITY OF MONTEBELLO, a California municipal corporation, whose address is 1600 West Beverly Boulevard Montebello, California 90640 ("Beneficiary"), and is executed to secure those two certain promissory notes each of even date herewith (the “Promissory Notes”), the first known as the Land Promissory Note in the principal amount of Three Million Seventy Five Thousand Dollars ($3,075,000.00), and the second known as the Impact Fee Note in the principal amount of Nine Hundred Fifty Thousand Dollars ($950,000.00), executed by Trustor in favor of Beneficiary (such Promissory Notes, as it may from time to time be supplemented, amended extended, renewed or otherwise modified), the provisions of which are incorporated in the Deed of Trust by this reference.

This Deed of Trust is made with respect to that certain Purchase, Sale, and Affordable Housing Development Agreement (6 th Street Grand, Montebello Phase 1), dated ____________, 2023, for reference purposes only, between Trustor and the Beneficiary (the "Affordable Housing Agreement").

Trustor hereby IRREVOCABLY GRANTS, TRANSFERS AND ASSIGNS to Trustee, its successors and assigns, in Trust, with POWER OF SALE TOGETHER WITH RIGHT OF ENTRY AND POSSESSION, the following property ("Trust Estate"):
(a) All of that certain real property in the City of Montebello, County of Los Angeles, State of California, more particularly described in Exhibit "A" attached hereto and by this reference made a part hereof ("Subject Property");

2 Exhibit L
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(b) All buildings, structures and other improvements now or in the future located or to be constructed on the Subject Property ("Improvements"); (c) All tenements, hereditament, appurtenances, privileges, franchises and other rights and interests now or in the future benefitting or otherwise relating to the Subject Property or the Improvements, including easements, rights-of-way and development rights ("Appurtenances"). (Appurtenances, together with the Subject Property and the Improvements, are hereafter collectively referred to as the "Real Property"); (d) Subject to the assignment to Beneficiary set forth in Paragraph 4 below, all rents, issues, income, revenues, royalties and profits now or in the future payable with respect to or otherwise derived from the Trust Estate or the ownership, use, management operation, leasing or occupancy of the Trust Estate, including those past due and unpaid ("Rents"); (e) All present and future right, title and interest of Trustor in and to all inventory, equipment, fixtures and other goods (as those terms are defined in Division 9 of the California Uniform Commercial Code ("UCC"), whether existing now or in the future) located at, upon or about, or affixed or attached to or installed in, the Real Property, or used or to be used in connection with or otherwise relating to the Real Property or the ownership, use, development, construction, maintenance, management, operation, marketing, leasing or occupancy of the Real Property, including furniture, furnishings, machinery, appliances, building materials and supplies, generators, boilers, furnaces, water tanks, heating, ventilating and air conditioning equipment and all other types of tangible personal property of any kind or nature, and all accessories, additions, attachments, parts, proceeds, products, repairs, replacements and substitutions of or to any of such property ("Goods," and together with the Real Property, collectively the "Property"); and (f) All present and future right, title and interest of Trustor in and to all accounts, general intangibles, chattel paper, deposit accounts, money, instruments and documents (as those terms are defined in the UCC) and all other agreements, obligations, rights and written material (in each case whether existing now or in the future) now or in the future relating to or otherwise arising in connection with or derived from the Property or any other part of the Trust Estate or the ownership, use, development, construction, maintenance, management, operation, marketing, leasing, occupancy, sale or financing of the Property or any other part of the Trust Estate, including (to the extent applicable to the Property or any other portion of the Trust Estate) (i) permits, approvals and other governmental authorizations, (ii) improvement plans and specifications and architectural drawings, (iii) agreements with contractors, subcontractors, suppliers, project managers, supervisors, designers, architects, engineers, sales agents, leasing agents, consultants and property managers, (iv) takeout, refinancing and permanent loan commitments, (v) warranties, guaranties, indemnities and insurance policies, together with insurance payments and unearned insurance premiums, (vi) claims, demands, awards, settlements, and other payments arising or resulting from or otherwise relating to any insurance or any loss or destruction of, injury or damage to, trespass on or taking, condemnation (or conveyance in lieu of condemnation) or public use of any of the Property, (vii) license agreements, service and maintenance agreements, purchase and sale agreements and purchase options, together with advance payments, security deposits and other amounts paid to or deposited with Trustor under any such agreements, (viii) reserves, deposits, bonds, deferred payments, refunds, rebates, discounts, cost savings, escrow proceeds, sale proceeds and other

3 Exhibit L
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rights to the payment of money, trade names, trademarks, goodwill and all other types of intangible personal property of any kind or nature, and (ix) all supplements, modifications, amendments, renewals, extensions, proceeds, replacements and substitutions of or to any of such property (collectively, "Intangibles").

Trustor further grants to Trustee and Beneficiary, pursuant to the UCC, a security interest in all present and future right, title and interest of Trustor in and to all Goods and Intangibles and all of the Trust Estates described above in which a security interest may be created under the UCC (collectively, the "Personal Property"). This Deed of Trust constitutes a security agreement under the UCC, conveying a security interest in the Personal Property to Trustee and Beneficiary.

Trustee and Beneficiary shall have, in addition to all rights and remedies provided herein, all the rights and remedies of a "secured party" under the UCC and other applicable California law.

Trustor covenants and agrees that this Deed of Trust constitutes a fixture filing under Sections 9313 and 9402(6) of the UCC.

FOR THE PURPOSE OF SECURING, in such order of priority as Beneficiary may elect, the following: (a) payment of that certain Land Promissory Note dated on or about even date hereof in the original principal amount of Three Million Seventy-Five Thousand Dollars ($3,075,000.00) (the "Land Note"), (b) payment of that certain Impact Fee Promissory Note dated on or about even date hereof in the original principal amount of Nine Hundred Fifty-Thousand Dollars ($950,000.00) (the "Project Note", and together with the Land Note referred to herein as the "Notes"); and (c) due, prompt and complete observance, performance and discharge of each and every monetary and non-monetary condition, obligation, covenant and agreement contained herein or contained in the Affordable Housing Agreement. The Affordable Housing Agreement, that certain Regulatory Agreement dated on or about even date hereof, for reference purposes only, between the Trustor and the Beneficiary ("Regulatory Agreement") and the Notes (collectively, "Secured Obligations") and all of their terms are incorporated herein by reference and this conveyance shall secure any and all extensions, amendments, modifications or renewals thereof, however evidenced.

AND TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR COVENANTS AND AGREES:

1. That Trustor shall perform its obligations as set forth in the Secured Obligations at the time and in the manner respectively provided therein;

2. That Trustor shall not permit or suffer the use of any of the property for any purpose other than the use for which the same was intended at the time this Deed of Trust was executed;

3. That the Secured Obligations are incorporated in and made a part of this Deed of Trust. Upon default of a Secured Obligation, and after the giving of notice and the expiration of any applicable cure period, the Beneficiary, at its option, may declare the whole of the indebtedness secured hereby to be due and payable. This Deed of Trust shall cover, and the property subject hereto shall include, all property now or hereafter affixed or attached to or incorporated upon the Subject Property in, to or under which Trustor now has or hereafter acquires any right, title or interest, which, to the fullest extent permitted by law, shall be deemed fixtures and a part of the Subject Property. To the extent any of the property subject to this Deed of Trust consists of rights

4 Exhibit L
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in action or personal property covered by the UCC, this Deed of Trust shall also constitute a security agreement, and Trustor hereby grants to Beneficiary, as secured party, a security interest in such property, including all proceeds thereof, for the purpose of securing the Secured Obligations. In addition, for the purpose of securing the Secured Obligations, Trustor hereby grants to Beneficiary, as secured party, a security interest in all of the property described herein in, to, or under which Trustor now has or hereafter acquires any right, title or interest, whether present, future or contingent, including, but not limited to, all equipment, inventory, accounts, general intangibles, instruments, documents and chattel paper, as those terms are defined in the UCC, and all other personal property of any kind (including, without limitation, money and rights to the payment of money), whether now existing or hereafter created, that are now or at any time hereafter (i) in the possession or control of Beneficiary in any capacity; (ii) erected upon, attached to or appurtenant to the Subject Property; (iii) located or used on the Subject Property or identified for use on the Subject Property (whether stored on the Subject Property or elsewhere); or (iv) used in connection with, arising from, related to, or associated with the Subject Property or any of the personal property described herein, the construction of any improvements on the Subject Property, the ownership, development, maintenance, management or operation of the Subject Property, the use or enjoyment of the Subject Property or the operation of any business conducted thereon, including, without limitation, all such property described as the Trust Estate hereinabove. The security interests granted in this Paragraph 3 are hereinafter severally and collectively called the "Security Interest". The Security Interest shall be self-operative with respect to the real property described herein but Trustor shall execute and deliver on demand such additional security agreements, financing statements and other instruments as may be requested in order to impose the Security Interest more specifically upon the real and personal property encumbered hereby.

The Security Interest, at all times, shall be prior to any other interest in the personal property encumbered hereby. Trustor shall act and perform as necessary and shall execute and file all security agreements, financing statements, continuation statements and other documents requested by Beneficiary to establish, maintain and continue the perfected Security Interest. Trustor, on demand, shall promptly pay all costs and expenses of filing and recordation, to ensure the continued priority of the Security Interest. Trustor shall not sell, transfer, assign or otherwise dispose of any personal property encumbered hereby without obtaining the prior written consent of Beneficiary, except that the Trustor may, in the ordinary course of business, replace personal property or dispose of personal property that will not be replaced because of its obsolescence.

Unless Beneficiary then agrees otherwise in writing, all proceeds from any permitted sale or disposition in excess of that required for full replacement shall be paid to Beneficiary to be applied on the Notes subject to the rights of any senior lenders. Although proceeds of personal property are covered hereby, this shall not be construed to mean that Beneficiary consents to any sale of such personal property. Upon its recordation in the real property records of Los Angeles County, this Deed of Trust shall be effective as a financing statement filed as a fixture filing. In addition, a carbon, photostatic or other reproduced copy of this Deed of Trust and/or any financing statement relating hereto shall be sufficient for filing and/or recording as a financing statement;

4. That all rents, profits and income from the property covered by this Deed of Trust are hereby assigned to the Beneficiary for the purpose of discharging the debt hereby secured.

Permission is hereby given to Trustor so long as no default exists hereunder after the giving of notice and the expiration of any applicable cure period, to collect such rents, profits and income for use in accordance with the provisions of the Secured Obligations;

5 Exhibit L
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5. That upon default hereunder or under the aforementioned agreements, and after the giving of notice and the expiration of any applicable cure period, Beneficiary shall be entitled to the appointment of a receiver by any court having jurisdiction, without notice, to take possession and protect the property described herein and operate same and collect the rents, profits and income therefrom;

6. That Trustor will keep the improvements now existing or hereafter erected on the Subject Property insured against loss by fire and such other hazards, casualties, and contingencies as may be required by applicable provisions of the Secured Obligations, and all such insurance shall be evidenced by standard fire and extended coverage insurance policy or policies. Such policies shall be endorsed with standard mortgage clause with loss payable to the Beneficiary and certificates thereof together with copies of original policies, if requested, shall be deposited with the Beneficiary;

7. To pay before delinquency any taxes and assessments affecting said Property; to pay, when due, all encumbrances, charges and liens, with interest, on said Property or any part thereof which appear to be prior or superior hereto; and to pay all costs, fees, and expenses of this trust. Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor shall not be required to pay and discharge any such tax, assessment charge or levy so long as Trustor is contesting the legality thereof in good faith and by appropriate proceedings, and Trustor has adequate funds to pay any liabilities contested pursuant to this Paragraph 7;

8. As it is provided more specifically in the Secured Obligations, to keep said property in good condition and repair, subject to ordinary wear and tear, casualty and condemnation, not to remove or demolish any buildings thereon; to complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged, or destroyed thereon and to pay when due all claims for labor performed and materials furnished therefor; to comply with all laws affecting said property or requiring any alterations or improvements to be made thereon (subject to Trustor's right to contest the validity or applicability of laws or regulations); not to commit or permit bad faith waste thereof; not to commit, suffer or permit any act upon said property in violation of law and/or covenants, conditions and/or restrictions affecting said property; not to permit or suffer any material alteration of or addition to the buildings or improvements hereafter constructed in or upon said Subject Property without the consent of the Beneficiary;

9. To appear in and defend any action or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee, and to pay all costs and expenses, including cost of evidence of title and reasonable attorney's fees in a reasonable sum, in any such action or proceeding in which Beneficiary or Trustee may appear;

10. Should Trustor fail, after the giving of notice and the expiration of any applicable cure period, to make any payment or do any act as herein provided, then Beneficiary or Trustee, but without obligation so to do and without notice to or demand upon Trustor and without releasing Trustor from any obligation hereof, may make or do the same in such manner and to such extent as either may deem necessary to protect the security hereof. Following default, after the giving of notice and the expiration of any applicable cure period, Beneficiary or Trustee, being authorized to enter upon said property for such purposes, may commence, appear in and/or defend any action

6 Exhibit L
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or proceeding purporting to affect the security hereof or the rights or powers of Beneficiary or Trustee; may pay, purchase, contest or compromise any encumbrance, charge, or lien which in the judgment of either appears to be prior or superior hereto; and, in exercising any such powers, may pay necessary expenses, employ counsel, and pay his reasonable fees;

11. Beneficiary shall have the right to pay all insurance premiums required by the Secured Obligations when due should Trustor fail to make any required premium payments after the giving of notice and the expiration of any applicable cure period. All such payments made by the Beneficiary shall be added to the sums secured hereby;

12. To pay immediately and without demand all sums so expended by Beneficiary or Trustee, under permission given under this Deed of Trust, with interest from date of expenditure, at the highest rate of interest permitted by law;

13. That the funds to be advanced hereunder are to be used in accordance with applicable provisions of the Secured Obligations; upon the failure of Trustor to do so, after the giving of notice and the expiration of any applicable cure period, Trustor shall be in default hereunder;

14. Trustor further covenants that it will not voluntarily create, suffer, or permit to be created against the Subject Property subject to this Deed of Trust any lien or liens except as authorized by Beneficiary and/or as provided and/or authorized in the Secured Obligations and further that it will keep and maintain the property free from the claims of all persons supplying labor or materials which will enter into the construction of any and all buildings now being erected or to be erected on said premises. Notwithstanding anything to the contrary contained in this Deed of Trust, Trustor shall not be obligated to pay any claims for labor, materials or services which Trustor in good faith disputes and is diligently contesting, provided that Trustor shall, at Beneficiary's written request, within thirty (30) days after the filing of any claim or lien (but in any event, and without any requirement that Beneficiary must first provide a written request prior to foreclosure) record in the Office of the Recorder of Los Angeles County, a surety bond in the amount required by law to protect against a claim of lien, or provide such other security reasonably satisfactory to Beneficiary;

15. That any and all improvements made or about to be made upon the premises covered by this Deed of Trust and all plans and specifications, comply with all applicable municipal ordinances and regulations and all other applicable regulations made or promulgated, now or hereafter, by lawful authority, and that the same will upon completion comply with all such applicable municipal ordinances and regulations and with the rules of the applicable fire rating or inspection organization, bureau, association or office.

IT IS MUTUALLY AGREED THAT:

16. Trustor confirms that if Trustor should sell, enter into a contract of sale, convey, or in any way transfer all or any interest of Trustor in the Real Property encumbered by this Deed of Trust or suffer Trustor's title or any interest therein to be divested, whether voluntarily or involuntarily, unless the same is a Permitted Transfer as defined in the Affordable Housing Agreement, without the prior written consent of the Beneficiary being first obtained, then

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Beneficiary shall have the right, at Beneficiary's sole option, to declare all sums payable under the Notes secured hereby immediately due and payable in full, irrespective of the maturity date otherwise specified in the Notes. No waiver of this right shall be effective unless in writing and signed by the Beneficiary. Consent by the Beneficiary to any one such transaction shall not be deemed a waiver of the right to require such consent to future or successive transactions. Further, upon default under one of the Secured Obligations, and after the giving of notice and the expiration of any applicable cure period provided therein, the Beneficiary, at its option, may declare the whole of the indebtedness secured hereby to be immediately due and payable in full, irrespective of the maturity date otherwise specified in the Notes;

17. As provided more specifically in the Secured Obligations, should the Property or any part thereof be taken or damaged by reason of any public improvement or condemnation proceeding, or damaged by fire, or earthquake, or in any other manner, subject to the rights of any senior lenders, Beneficiary shall be entitled to all compensation, awards, and other payments or relief therefor which are not used to reconstruct, restore or otherwise improve the Property or part thereof that was taken or damaged, and shall be entitled at its option to commence, appear in and prosecute in its own name, any action or proceedings, or to make any compromise or settlement, in connection with such taking or damage subject to the rights of any senior lenders. All such compensation, awards, damages, rights of action and proceeds which are not used to reconstruct, restore or otherwise improve the property or part thereof that was taken or damaged, including the proceeds of any policies of fire and other insurance affecting said property, are hereby assigned to Beneficiary subject to the rights of any senior lenders;

18. Notwithstanding Sections 16 and 17, in the event that a portion of the Property is taken for a public improvement or pursuant to a condemnation proceeding and the Qualifying Units (as defined in the Regulatory Agreement) remain intact and continue to be owned and operated by Trustor in conformance with the Affordable Housing Agreement and the Regulatory Agreement, Beneficiary shall not declare all sums due and payable under the Notes, nor shall the Beneficiary be entitled to any compensation, awards and other payments therefor, provided that subject to the rights of any senior lenders, such compensation, awards and other payments are used for (1) paying principal and interest owed on the Permanent Loan (as defined in the Affordable Housing Agreement), (2) making improvements to the Property that are approved by Beneficiary, in its reasonable discretion, or (3) payment of principal owing under the Notes. In the event that Trustor receives such compensation, awards or other payments and fails to expend the funds in conformance with subsections (1) and (2) this section within thirty (30) days of receipt of such funds, Trustor shall be in default under this Deed of Trust;

19. Upon default by Trustor in taking any action or in making any payments provided for herein, or in the Secured Obligations, if Trustor shall fail to perform any covenant or agreement in this Deed of Trust within thirty (30) days after written demand therefor by Beneficiary (or, in the event that more than thirty (30) days is reasonably required to cure such default, should Trustor fail to promptly commence such cure, and diligently prosecute same to completion), after the giving of notice and the expiration of any applicable cure period, Beneficiary may declare all sums secured hereby immediately due and payable by delivery to Trustee of written declaration of default and demand for sale, and of written notice of default and of election to cause the property to be sold, which notice Trustee shall cause to be duly filed for record and Beneficiary may

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foreclose this Deed of Trust. Beneficiary shall also deposit with Trustee this Deed of Trust and all documents evidencing expenditures secured hereby;

20. After the lapse of such time as may then be required by law following the recordation of said notice of default, and notice of sale having been given as then required by law, Trustee, without demand on Trustor, shall sell said property at the time and place fixed by it in said notice of sale, either as a whole or in separate parcels, and in such order as it may determine at public auction to the highest bidder for cash in lawful money of the United States, payable at time of sale. Trustee may postpone sale of all or any portion of said property by public announcement at the time and place of sale, and from time to time thereafter may postpone the sale by public announcement at the time and place of sale, and from time to time thereafter may postpone the sale by public announcement at the time fixed by the preceding postponement.

Trustee shall deliver to the purchaser its Deed conveying the property so sold, but without any covenant or warranty, express or implied. The recitals in the Deed of any matters or facts shall be conclusive proof of the truthfulness thereof. Any person, including Trustor, Trustee or Beneficiary, may purchase at the sale. The Trustee shall apply the proceeds of sale to payment of (1) the expenses of such sale, together with the reasonable expenses of this trust including therein reasonable Trustee's fees or attorney's fees for conducting the sale, and the actual cost of publishing, recording, mailing and posting notice of the sale; (2) the cost of any search and/or other evidence of title procured in connection with such sale and revenue stamps on Trustee's Deed; (3) all sums expended under the terms hereof, not then repaid, with accrued interest at the maximum rate allowed by law; (4) all other sums then secured hereby; and (5) the remainder, if any, to the person or persons legally entitled thereto;

21. Beneficiary may from time to time substitute a successor or successors to any Trustee named herein or acting hereunder to execute this Deed of Trust. Upon such appointment, and without conveyance to the successor trustee, the latter shall be vested with all title, powers, and duties conferred upon any Trustee herein named or acting hereunder. Each such appointment and substitution shall be made by written instrument executed by Beneficiary, containing reference to this Deed of Trust and its place of record, which, when duly recorded in the proper office of the county or counties in which the property is situated, shall be conclusive proof of proper appointment of the successor trustee;

22. The pleading of any statute of limitations as a defense to any and all obligations secured by this Deed of Trust is hereby waived to the full extent permissible by law;

23. Upon written request of Beneficiary stating that all sums secured hereby have been paid and all obligations secured hereby have been satisfied, and upon surrender of this Deed of Trust to Trustee for cancellation and retention and upon payment of its fees, Trustee shall reconvey, without warranty, the property then held hereunder. The recitals in such reconveyance of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such reconveyance may be described as "the person or persons legally entitled thereto";

24. The trust created hereby is irrevocable by Trustor;

25. This Deed of Trust applies to, inures to the benefit of, and binds all parties hereto, their heirs, legatees, devisees, administrators, executors, successors, and assigns. The term

9 Exhibit L
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"Beneficiary" shall include not only the original Beneficiary hereunder but also any future successor in interest to Beneficiary. In this Deed of Trust, whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural.

All obligations of Trustor hereunder are joint and several;

26. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made public record as provided by law. Except as otherwise provided by law, the Trustee is not obligated to notify any party hereto of pending sale under this Deed of Trust or of any action or proceeding in which Trustor, Beneficiary, or Trustee shall be a party unless brought by Trustee;

27. The undersigned Trustor requests that a copy of any notice of default and of any notice of sale hereunder be mailed to it at the address set forth in the Deed of Trust;

28. Trustor agrees at any time and from time to time, upon receipt of a written request from Beneficiary, to furnish to Beneficiary detailed statements in writing of income, rents, profits, and operating expenses of the premises, and the names of the occupants and tenants in possession, together with the expiration dates of their leases and full information regarding all rental and occupancy agreements, and the rents provided for by such leases and rental and occupancy agreements, and such other information regarding the premises and their use as may be requested by Beneficiary;

29. Trustor agrees that the obligations secured by this Deed of Trust are made expressly for the purpose of acquiring the Property, completing the construction work necessary to construct a new sixty-three (63) unit affordable housing development on the Property, as is more specifically provided in the Secured Obligations;

30. As is provided more specifically in the Secured Obligations, the obligations of Trustor thereunder are nonrecourse obligations of the Trustor. The sole recourse of Beneficiary shall be the exercise of its rights against the Property;

31. Notwithstanding specific provisions of this Deed of Trust, non-monetary performance hereunder shall not be deemed to be in default where delays or defaults are due to:
war; insurrection; strikes; lock-outs; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; epidemics; pandemics, quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; governmental shut-downs, litigation; unusually severe weather; inability to secure necessary labor, materials or tools; delays of any contractor or supplier; acts of the other party; acts or failure to act of the City of Montebello or any other public or governmental agency or entity (except that any act or failure to act of Beneficiary shall not excuse performance by Beneficiary unless such act or failure to act is allowed or required by law); or any other causes beyond the reasonable control or without the fault of the party claiming an extension of time to perform. An extension of time for any such cause (a "Force Majeure Delay") shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause. If, however, notice by the party claiming such extension is sent to the other party more than thirty (30) days after the commencement of the cause, the period shall commence to run only thirty (30) days prior to the giving of such notice. Times

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of performance under this Deed of Trust may also be extended in writing by the Beneficiary and Trustor;

32. If the rights and liens created by this Deed of Trust shall be held by a court of competent jurisdiction to be invalid or unenforceable as to any part of the obligations described herein, the unsecured portion of such obligations shall be completely performed and paid prior to the performance and payment of the remaining and secured portion of the obligations, and all performance and payments made by Trustor shall be considered to have been performed and paid on and applied first to the complete payment of the unsecured portion of the obligations;

33. (a) Subject to the extensions of time set forth in Paragraph 31, and subject to the further provisions of this Paragraph 33, failure or delay by Trustor to perform any term or provision respectively required to be performed under the Secured Obligations or this Deed of Trust constitutes a default under this Deed of Trust;
(b) Beneficiary shall give written notice of default to Trustor, specifying the default complained of by the Beneficiary. Delay in giving such notice shall not constitute a waiver of any default nor shall it change the time of default; (c) Any failures or delays by Beneficiary 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. Delays by Beneficiary in asserting any of its rights and remedies shall not deprive Beneficiary 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; (d) If an event of default occurs under the terms of this Deed of Trust, prior to exercising any remedies hereunder or thereunder, Beneficiary shall give Trustor written notice of such default. If the default is reasonably capable of being cured within thirty (30) days, Trustor shall have such period to effect a cure prior to exercise of remedies by Beneficiary under this Deed of Trust. If the default is such that it is not reasonably capable of being cured within thirty (30) days, and Trustor (i) initiates corrective action within said period, and (ii) diligently and in good faith works to effect a cure as soon as reasonably possible, then Trustor shall have such additional time as is reasonably necessary to cure the default prior to exercise of any remedies by Beneficiary.

In no event shall Beneficiary be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by any failure to cure a default; (e) If an event of default occurs under the terms of the Secured Obligations, prior to exercising any remedies hereunder or thereunder, Beneficiary shall give Trustor notice of such default. As is provided more specifically in the Secured Obligations, if the default is reasonably capable of being cured within thirty (30) days, Trustor shall have such period to effect a cure prior to exercise of remedies by the Beneficiary under the Secured Obligations, or this Deed of Trust. If the default is such that it is not reasonably capable of being cured within thirty (30) days, and Trustor (i) initiates corrective action within said period, and (ii) diligently and in good faith works to effect a cure as soon as reasonably possible, then Trustor shall have such additional time as is reasonably necessary to cure the default prior to exercise of any remedies by Beneficiary.

In no event shall Beneficiary be precluded from exercising remedies if its security becomes or is about to become materially jeopardized by any failure to cure a default.

11 Exhibit L
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34. This Deed of Trust shall be subject and subordinate to the terms of that certain extended use agreement executed by the Trustor in connection with the Trustor's allocation of low- income housing tax credits under Section 42 of the Code (the "Extended Use Agreement"). If Beneficiary or its successors or assigns (collectively, the "Subsequent Owner") acquires the Property by foreclosure (or instrument in lieu of foreclosure), then the "extended use period" (as defined in Section 42(h)(6)(D) of the Internal Revenue Code) shall terminate, except for the obligation of the Subsequent Owner to comply with the limitations on evictions, termination of tenancy and increase in rents for the three year period following the Subsequent Owner's acquisition of the Property, as set forth in Section 42(h)(6)(E)(ii) of the Internal Revenue Code.

As provided in the Affordable Housing Agreement, upon request when appropriate, Beneficiary shall execute such documentation as is necessary to subordinate this Deed of Trust to a Senior Loan.
[Signatures on Following Page]

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IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the day and year first set forth above.

TRUSTOR:

MONTEBELLO AFFORDABLE HOUSING,
LP, a California limited partnership
[to be inserted]
[SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

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EXHIBIT A TO

DEED OF TRUST, SECURITY AGREEMENT AND FIXTURE FILING
(WITH ASSIGNMENT OF RENTS)
Legal Description of Subject Property
All that certain real property situated in the County of Los Angeles, State of California, described as follows:

PARCEL 1:

LOT 19 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK (BEING A SUBDIVISION OF

CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THE SOUTHWEST 88 FEET OF SAID LOT.

ALSO EXCEPT ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395 PAGE 381, OFFICIAL RECORDS.

PARCEL 2:

LOT 20 OF ADDITION NO. 1 TO THE TOWN OF NEWMARK, IN THE CITY OF

MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO) AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM THE SOUTH 36 FEET OF THE NORTH 44 FEET OF THE WEST 115 FEET THEREOF.

PARCEL 3:

THE SOUTHERLY 36 FEET OF THE NORTHERLY 44 FEET OF THE WESTERLY 115 FEET OF LOT 20 OF THE ADDITION NO. 1, TO THE TOWN OF NEWMARK (BEING A

SUBDIVISION OF CERTAIN LOTS OF MONTEBELLO), IN THE CITY OF MONTEBELLO,

COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8 PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPT THEREFROM FROM PARCELS 2 AND 3 ABOVE ONE-HALF OF ALL OIL, GAS,

PETROLEUM, ASPHALTUM AND OTHER HYDROCARBON SUBSTANCES AND OTHER

MINERALS, PRODUCED FROM THE PREMISES, AS EXCEPTED IN THE DEED FROM

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HENRY M. NEWMARK AND MARIE LOUISE NEWMARK, HIS WIFE, AND ROSE N.

SUTRO AND ALFRED SUTRO, HER HUSBAND, RECORDED IN BOOK 6771 PAGE 81 OF OFFICIAL RECORDS OF SAID COUNTY.

PARCEL 4:

THE SOUTHERLY 44 FEET OF LOT 19 OF THE ADDITION NO. 1, TO THE TOWN OF

NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM AN INTEREST IN ALL OIL, OIL RIGHTS, NATURAL GAS

RIGHTS, MINERAL RIGHTS, ALL OTHER HYDROCARBON SUBSTANCES BY

WHATSOEVER NAME KNOWN, AND ALL RIGHTS THERETO, WITHOUT HOWEVER,

ANY RIGHT TO ENTER UPON THE SURFACE OF SAID LAND NOR ANY PORTION OF

THE SUBSURFACE, AS EXCEPTED OR RESERVED BY DEED RECORDED IN BOOK 7395, PAGE 381, OFFICIAL RECORDS.

PARCEL 5:

THE SOUTHWESTERLY 44 FEET OF THE NORTHEASTERLY 88 FEET OF LOT 19 OF ADDITION NO. 1, TOWN OF NEWMARK, IN THE CITY OF MONTEBELLO, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 8, PAGE 36 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING ONE-HALF OF ALL OIL, GAS, PETROLEUM, ASPHALTUM AND OTHER

HYDROCARBON SUBSTANCES AND OTHER MINERALS PRODUCED FROM SAID LAND, AS RESERVED IN THE DEED FROM HENRY M. NEWMARK, ET AL., RECORDED IN BOOK 7395, PAGE 381, OF OFFICIAL RECORDS.

APN: 6349-005-900, 901, 902 (Parcels 1-3) and 903 (Parcel 4) APN: 6349-005-006 (Parcel 5)

1 Exhibit M
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EXHIBIT M
Form of Impact Fee Note
(see attached)

1 Exhibit M
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IMPACT FEE PROMISSORY NOTE SECURED BY DEED OF TRUST
(6th Street Grand, Montebello Phase 1)
Principal Amount: $950,000 Date of Note: March __, 2023 Maker: MONTEBELLO
AFFORDABLE HOUSING, LP, a
California limited partnership
Lender: CITY OF MONTEBELLO, a
municipal corporation
Maturity Date: Fifty-five (55) years
from the date on which the Construction
Financing converts to the Permanent
Loan
Interest Rate: Three Percent (3%)

1. Impact Fee Loan.

FOR VALUE RECEIVED, the undersigned MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership ("Maker"), with its principal place of business located at 29700 Woodford Tehachapi Road, Keene, CA 93531, promises to pay to the CITY OF MONTEBELLO, a California municipal corporation (the "City" or "Holder") at 1600 West Beverly Blvd., Montebello, California, or such place as the Holder may, from time to time, designate by written notice to the Maker, the principal sum of NINE HUNDRED FIFTY THOUSAND DOLLARS ($950,000), (the "Impact Fee Loan"), together with any accrued interest, if applicable, as set forth in this Note. This Promissory Note (the "Note") is made and given pursuant to that certain Purchase, Sale, and Affordable Housing Development Agreement (6 th Street Grand, Montebello Phase 1) between the City and Maker dated ___________, 2023 (the "Affordable Housing Agreement") and concerning the Project Site. The Affordable Housing Agreement is incorporated herein by this reference. All initially capitalized terms used but not defined herein shall have the meanings given to them in the Affordable Housing Agreement. The Impact Fee Loan is made to defer the impact fees due by Maker for development of the Project Site with the Project in accordance with the terms and conditions of the Affordable Housing Agreement.

2. Term of Loan and Right of Prepayment.
a. Maturity Date. All accrued interest, if any, and principal shall be due and payable in full without any further demand or notice fifty-five (55) years from the date on which the Construction Financing converts to the Permanent Loan ("Maturity Date"). b. Prepayment. This Note may be prepaid in whole or in part at any time and from time to time without penalty or premium.

3. Security for Note.

This Note is secured by a Deed of Trust executed by Maker which creates a lien on that certain real property as described therein and in the Affordable Housing Agreement.

2 Exhibit M
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4. Interest Calculation.

The principal outstanding under this Note shall accrue simple interest at the rate of three percent (3%) per annum, except in the case of Default as set forth in Section 9 of this Note.

Principal and interest shall be payable in lawful money of the United States of America. If applicable, interest shall be computed based on an actual day year and the actual number of days elapsed. Interest shall commence on amounts disbursed hereunder from the date of disbursement.

5. Annual Payment.

Following completion of the Project as evidenced by the issuance by the City of a Certificate of Completion as set forth in the Affordable Housing Agreement, and continuing each year thereafter until the Maturity Date, a portion of the Residual Receipts (as defined below) from the Project shall be paid to Holder and applied to pay down the amounts due and owing under this Note. The payments described below shall be paid to Holder no later than September 1 each year, with the first payment due on the September 1 following the issuance of a Certificate of Occupancy for the Project, and continuing each year thereafter.
a. Annual Payments from Residual Receipts. Maker shall make repayments of the outstanding principal and accrued interest, if any, equal to the City's Impact Fee Percentage of Fifty Percent (50%) of the Residual Receipts from the Project as repayment of amounts due and owing under this Note. For the purposes of this Note, "City's Impact Fee Percentage" means the percentage calculated by dividing (1) the original principal amount of the Land Loan actually disbursed to Borrower by (2) the sum of Total Assistance from all other government entities obtained by the Borrower, to the extent not requiring a mandatory debt service payment. "Total Assistance" means the collective sum of (i) the original principal amount of the Land Loan, and (ii) the original principal amounts of loans made by the other government entities which are required to be repaid utilizing Residual Receipts.

Such annual payments shall be accompanied by the Maker's report of Residual Receipts. The Maker shall provide the Holder with the audited financial statement provided for in Section 6, and any other documentation reasonably requested by Holder to substantiate the Maker's determination of Residual Receipts.

All payments made hereunder shall be credited first to any accrued but unpaid interest (if applicable), then to current interest due and owing and lastly to principal.

Notwithstanding the foregoing, the entire outstanding balance of principal and any interest owing under this Note shall be due and payable in full on the Maturity Date.

Prior to any sale of all or any portion of the Project, or Refinancing of all or any portion of the outstanding debt from the Project, and so long as there is any outstanding amount due and owing under this Note, Maker shall notify Holder of any such proposed or intended sale or Refinancing. In such event, Maker and Holder shall meet and confer, and shall use good faith efforts, to determine the feasibility of the payoff or restructuring of the remaining balance owing under this Note as part of any such sale or Refinancing to provide for repayment of this Note sooner than the fifty-five (55) year repayment period.

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b. Definition of Residual Receipts. For the purposes of this Note, "Residual Receipts" shall mean the sum of money computed as follows:
(i) All rents, revenues, consideration or income (of any form) received by Maker in connection with or relating to the ownership or operation of the Project, including the City’s any net revenue derived from any Refinancing of the Project which is not required to meet current or future Project obligations (but excluding tenants' security deposits, partner capital contributions and similar advances or interest that is earned on and allocated to reserve accounts) ("Gross Revenue") less all of the following: all customary and reasonable costs (i.e., mandatory (hard) mortgage payments) and expenses reasonably and actually incurred in connection with the operation and maintenance of the Project, including but not limited to premiums for property and liability insurance; utility services not paid directly by tenants; maintenance and repair; security services and payments for social/supportive services; any adjuster payments to the investor limited partner required under Maker's partnership agreement; payment of principal or interest on any indebtedness of Maker to any affiliate of Maker (individual or entity) or partner of Maker to repay completion, operating deficit or other loans relating to the Project; asset management fee payable to the limited partner of Maker in an amount approved as part of the Project Budget (as defined in the Affordable Housing Agreement), increased annually by three percent (3%); partnership management fee payable to Maker, not to exceed the amount approved as part of the Project Budget (as defined in the Affordable Housing Agreement), increased annually by three percent (3%); reasonable property management fees not to exceed Sixty-Five Dollars ($65) per unit per year, increased annually by three and one-half percent (3.5%); deferred developer fee in an amount approved as part of the Project Budget (as defined in the Affordable Housing Agreement); amounts (reasonably approved by Holder) expended to restore the Project after a casualty loss or condemnation; reasonable and customary professional fees for legal, accounting, audit and tax returns for Maker and the Project, and similar customary expenses; taxes; franchise tax filing fees; and any cash deposited into replacement and operating reserves in amounts reasonably required by the investor or the lenders for the Project (collectively "Operating Expenses"). (ii) Notwithstanding the generality of the foregoing, the following items are not expenses or deductible in computing Residual Receipts: depreciation, cost recovery, amortization and similar items which do not involve the expenditure of cash.

6. Audited Financial Statement.

Maker shall annually provide Holder with an audited financial statement documenting the calculation of Residual Receipts for the previous calendar year ending December 31. The audited financial statement shall be provided on or before September 1, together with payment of the Residual Receipts payment due to Holder. Holder shall have the right to inspect and audit Maker's books and records concerning the calculation of the Residual Receipts Payment and to object within ninety (90) days from receipt of Maker's statement. Failure to timely object shall be deemed acceptance. If Holder does object, Holder shall specify the reasons for disapproval. Maker shall have thirty (30) days to reconcile any disapproved item. If Maker and Holder cannot agree on the amount of the Residual Receipts payment, an independent auditor mutually selected by Maker and Holder shall resolve any disputed items. If the independent auditor determines that Maker’s statement underreported the amount of the Residual Receipts by more than three percent (3%), the cost of the auditor shall be paid solely by Maker. If the independent auditor determines that

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Maker’s statement did not underreport the amount of the Residual Receipts, the cost of the auditor shall be paid solely by Holder. Except in the event that Maker or Holder are solely responsible for the costs of the auditor pursuant to one of the foregoing sentences, the cost of the auditor shall be shared equally by Maker and Holder.

7. Annual Budget.

Maker shall prepare and submit to Holder a proposed annual operating budget for the management and operation of the Project ("Annual Budget") no later than 15 days preceding the effective year of such budget. The Annual Budget shall include the projected Gross Revenue and Operating Expenses for the year and a line item showing the projected Residual Receipts from the Project for the year. Holder will review the Annual Budget and, if acceptable, approve it, which approval shall not be unreasonably withheld. If the Annual Budget is not acceptable, Holder shall specify the reasons for disapproval. The intent of this section is to provide Holder an opportunity to disapprove any unreasonable expenses which would diminish the Residual Receipts from the Project. Once approved, any changes to the Annual Budget which exceed ten percent (10%) of the total Annual Budget shall require Holder's prior written consent, which consent shall not be unreasonably withheld.

8. Acceleration Upon Certain Events or Upon Event of Default.

On the occurrence of an Event of Default under the terms of this Note, the Affordable Housing Agreement or the Regulatory Agreement, the Deed of Trust which is the security for this Note, or under any Senior loans, notes or deeds of trust, at the option of the Holder and after notice to the Maker, providing Maker with thirty (30) days in which to cure any Event of Default, and such Event of Default not having been cured within thirty (30) days (or if a greater amount of time is reasonably necessary to effect a cure, if actions to cure such Event of Default are not undertaken within said thirty (30) day period and pursued with reasonable diligence thereafter), all principal and interest due under this Note shall immediately become due and payable, upon thirty (30) day written notice from the Holder to the Maker. Failure to exercise such option shall not constitute a waiver of the right to exercise it in the event of any subsequent Event of Default.

Should the undersigned Maker agree to or sell, convey, transfer, or dispose of the real property described in the Deed of Trust securing this Note or any part thereof or interest therein, without first obtaining the prior written consent of the Holder (except for a Permitted Transfer, as defined in the Affordable Housing Agreement), then, at the option of the Holder, all principal and interest due hereunder shall immediately become due and payable upon thirty (30) days written notice from the Holder to the Maker. Consent to one transaction of this type will not constitute a waiver of the right to require consent to future or successive transactions.

Notwithstanding the generality of the foregoing, certain transfers permitted under the Affordable Housing Agreement shall not constitute an Event of Default hereunder or under the Affordable Housing Agreement, and any such action shall not accelerate the maturity of this Promissory Note, provided that any transfer is either a Permitted Transfer as defined in the Affordable Housing Agreement or is reasonably acceptable to the City with reasonable promptness, and any transferee under such a transfer agrees to be bound by any and all instruments in favor of the City.

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9. Interest on Event of Default.

From and after an Event of Default, the entire outstanding principal balance of this Note shall automatically bear an annual interest rate equal to the lesser of: (a) eight percent (8%) compounding annually; or (b) the maximum interest rate allowed by law.

10. Costs Paid by Maker.

Maker agrees to pay the following costs, expenses and attorneys fees paid or incurred by the Holder of this Note, or as adjudged by a court of competent jurisdiction: (a) reasonable costs of collection, costs and expenses and reasonable attorneys fees paid or incurred in connection with the collection or enforcement of this Note, whether or not suit is filed; and (b) costs of suit in such sum as the court may adjudge reasonable as attorneys fees in any action to enforce payment of this instrument.

11. Waiver.

Maker hereby waives diligence, presentment, protest and demand, notice of protest, dishonor and nonpayment of this instrument, and expressly agrees that, without in any way affecting the liability of Maker hereunder, the Holder hereof may extend the Maturity Date or the time for payment of any installment due hereunder, accept additional security, release any party liable hereunder or release any security now or hereafter securing this Note. Maker hereby waives, to the fullest extent permitted by law, the right to plead any and all statutes of limitations as a defense to any demand on this instrument or any deed of trust, security agreement, guarantee or other agreement now or hereafter securing this Note.

12. Indemnification.

Maker shall indemnify, defend, protect and hold the City harmless from and against any and all loss, damage, liability, action, cause of action, cost or expense, including, without limitation, reasonable attorneys fees and expenses incurred by the Holder hereof, arising as a result of any (i) fraud or material misrepresentation by the Maker under or in connection with the Affordable Housing Agreement or related agreements; (ii) intentional bad faith waste of the real property encumbered by the deed of trust which secures this Note; and (iii) losses resulting from Maker's failure to maintain insurance as required under the provisions of the deed of trust securing this Note and the Affordable Housing Agreement.

13. Nonrecourse.

This Note is nonrecourse obligation of Maker and Maker’s partners and the Holder must resort only to the Project or the Property, or both, for repayment should the Maker fail to repay the sums evidenced hereby. Neither Maker nor any of its general or limited partners shall have any personal liability for repayment of the Land Loan and no deficiency judgment may be obtained against Maker or any of its general or limited partners except for actual or constructive fraud, intentional material misrepresentation, intentional bad faith waste of or on the Project and such other matters as are referred to below. Notwithstanding the generality of the foregoing, however, Maker shall indemnify, defend, protect and hold Holder harmless from and against any and all loss, damage, liability, action, cause of action, cost or expense, including, without limitation,

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reasonable attorneys' fees and expenses incurred by the Holder arising as a result of any (i) fraud or intentional material misrepresentation by the Maker under or in connection with the Affordable Housing Agreement or any other agreements or documents provided in connection therewith; (ii) intentional bad faith waste of the Property encumbered by the deed of trust which secures this Note; and (iii) losses resulting from Maker's failure to maintain insurance as required under the provisions of the deed of trust securing this Note. Maker's obligation to indemnify the Holder hereof as aforesaid shall be recourse obligations of the Maker, and in the event of any breach of such obligations, the Holder shall have the right to proceed directly against the Maker to recover any and all losses, damages, liability, costs and expenses (including without limitation, reasonable attorneys' fees and expenses) and may bring any action and institute any proceeding to obtain a deficiency judgment in or following foreclosure for any and all such losses, damages, liabilities, costs and expenses resulting from such breach.

14. Severability.

If any provision of this Note is determined by a court of competent jurisdiction to be void or unenforceable, such determination shall not affect any other provision of this instrument, and all other provisions hereof shall remain valid and in full force and effect.

15. Non-Waiver.

No delay in demanding or failure to demand performance hereunder shall constitute a waiver by the Holder hereof of its right to subsequently demand such performance or to exercise any remedies for any Event of Default hereunder. Further, in order to be effective, any waiver of any of the Holder's rights and remedies hereunder shall be expressed in a writing signed by a duly appointed representative of the Holder hereof. Further, waiver by the Holder hereof of any right hereunder shall not constitute a waiver of any other right, including, but not limited to, the right to exercise any and all remedies for a different or subsequent Event of Default hereunder. [Signatures on Following Page]

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MAKER:

MONTEBELLO AFFORDABLE HOUSING, LP,
a California limited partnership
[to be inserted]
By: ___________________,
,
its managing general partner

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EXHIBIT N
Form of Phase II Performance Guaranty
(see attached)

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EXHIBIT N

PHASE II PERFORMANCE GUARANTY
This PERFORMANCE GUARANTY AGREEMENT (this “Guaranty”) is made as of ____________, 2023, by CESAR CHAVEZ FOUNDATION, a California non-profit public benefit corporation (the “Guarantor”), whose address is 29700 Woodford Tehachapi Road, Keene, CA 93531, in favor of CITY OF MONTEBELLO, a California municipal corporation (“City”).

WHEREAS, City and MONTEBELLO AFFORDABLE HOUSING, LP, a California limited partnership (“Phase I Partnership”), an affiliate of Guarantor, have entered into that certain Amended and Restated Purchase, Sale, and Affordable Housing Development Agreement dated as of February ___, 2023 (the “AH Agreement”), with all capitalized terms not defined herein to have the meaning assigned in the AH Agreement; WHEREAS, the AH Agreement concerns the sale, purchase, and development of certain parcels of real property located between 112 and 132 S. 6th Street, City of Montebello, California, and as relevant here provides for, among other things: (a) the City’s sale of the City Properties to the Phase I Partnership; (b) the Phase I Partnership’s combination of the City Properties with the Developer Property to create a single Project Site totaling approximately thirty-five thousand square feet (35,000 sf) (or .80 acres); (c) the City’s provision of financial assistance to the Phase I Partnership in the form of the Land Note and Impact Fee Note; and (d) the Phase I Partnership’s development of the Project Site with a Project to consist of sixty-three (63) affordable housing units (one of which units shall be an unrestricted manager’s unit) with affordability covenants of fifty-five (55) years;

WHEREAS, as additional consideration and further inducement for the City’s agreement to enter into the AH Agreement with the Phase I Partnership, Guarantor has committed to acquiring those certain parcels of real property located immediately north of the Project Site and located at 501, 507, 509, 513, 517, 525 Whittier Boulevard, City of Montebello (“Phase II Site”), and developing the Phase II Site with a second phase development consisting of a mixed-use project with approximately sixty-nine (69) housing units (35% of which will be restricted for affordable housing) and approximately 10,000 square feet of commercial / restaurant space with supportive parking as described in Attachment “1” hereto (the “Phase II Project”), as Guarantors commitment to the Phase II Project was memorialized in that certain Assignment of Purchase, Sale, and Development Agreement dated November 10, 2021, entered into between the City and Guarantor (the “PSDA Assignment”);
WHEREAS, Guarantor or an affiliate of Guarantor has a financial interest in the Phase I Partnership;
WHEREAS, on or about the same date hereof, the Phase I Partnership has assigned to Guarantor, and Guarantor has assumed from the Phase I Partnership, all rights and obligations of the Phase I Partnership under the AH Agreement with respect to the Phase II Site and Phase II Project; and

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WHEREAS, City would not execute the AH Agreement if Guarantor did not execute and deliver to City this Guaranty.

NOW, THEREFORE, for and in consideration of the execution of the AH Agreement by City, and as a material inducement to City for executing said AH Agreement, Guarantor hereby absolutely, presently, continually, unconditionally and irrevocably guarantees to City that, in the event Guarantor (or an affiliate thereof) does not complete the acquisition of the Phase II Site or does not complete construction of the Phase II Project in accordance with the schedule of performance attached hereto as Attachment “2” (“Schedule of Performance”), then subject to the terms of this Guaranty, including, without limitation, any applicable notice and cure rights, any “Permitted Delay,” and any “Permitted Extension” (as those terms are defined below), then City may deliver written notice to Guarantor (the “City Payment Notice”), requiring Guarantor to pay to City, the sum of Three Million Seventy-Five Thousand Dollars ($3,075,000) (the “Default Payment”). If Guarantor receives a City Payment Notice, Guarantor shall pay the Default Payment in five (5) equal annual payments of Six Hundred Fifteen Thousand Dollars ($615,000) (each, an “Installment Payment”), with each such Installment Payment due on January 1 st, commencing on the first January 1 st following the date Guarantor receives the City Payment Notice.

Guarantor further agrees as follows:

1. The time within which Guarantor shall be required to perform any act under the Schedule of Performance shall be extended by a period of time equal to the number of days during which performance of such act is delayed unavoidably and beyond the reasonable control of the party seeking the delay by, without limitation, strikes, acts of God, weather, inability to obtain labor or materials, inability to obtain governmental permits or approvals, governmental restrictions or priorities, epidemics, pandemics, civil commotion, including strikes, lockouts or riots, litigation, acts of the public enemy, fire, earthquakes, or similar causes (each a “Permitted Delay”). An extension of time for any such cause shall be for the period of the Permitted Delay and shall commence to run from the time of the commencement of the cause, if notice by Guarantor claiming such extension is sent to City within sixty (60) days of the commencement of the cause. If notice is sent after such sixty (60) day period, then the extension shall commence to run no sooner than sixty (60) days prior to the giving of such notice. Guarantor’s inability or failure to obtain financing or, subject to the terms of Section 4 below, favorable purchase price terms shall not be deemed to be a cause outside the reasonable control of Guarantor and shall not be the basis for a Permitted Delay.

2. Notwithstanding anything to the contrary in this Guaranty, Guarantor may request one or more extensions to the Schedule of Performance not to exceed, cumulatively, more than twenty-four (24) months. City’s Director of Planning & Community Development (the “Director”) shall have the authority to grant such extensions (any such granted extension, a “Permitted Extension”), and shall reasonably consider granting such extensions if, prior to the date of the request for an extension, Guarantor has diligently, without interruption, and in good faith worked to timely complete the tasks in the Schedule of Performance.

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3. Subject to any extensions of time provided for in this Guaranty, failure or delay by either party to timely perform any term or provision of this Guaranty shall constitute an “Event of Default” under this Guaranty; provided, however, that if a party otherwise in default commences to cure, correct or remedy such default within thirty (30) calendar days after receipt of written notice from the injured party specifying such default, and diligently and continuously prosecutes without interruption such cure, correction or remedy to completion, such party shall not be deemed to be in default under this Guaranty and no Event of Default shall be deemed to have occurred.

4. Notwithstanding anything to the contrary in this Guaranty, the AH Agreement, or the PSDA Assignment, City agrees that if despite Guarantor’s diligent and good faith efforts to negotiate the acquisition of the portion of the Project II Site located at 513 Whittier Boulevard (the “513 Whittier Property”), Guarantor is unable to reach mutually agreeable sale terms with the owner of the 513 Whittier Property (the “513 Whittier Property Owner”), Guarantor shall provide written notice thereof to City (the “513 Whittier Property Notice”), and subject to the following two sentences, Guarantor shall be permitted to redesign the Phase II Project to enable the Phase II Project to be constructed on the remaining portions of the Project II Site (i.e., all portions of the Project II Site except the 513 Whittier Property) (the “Redesigned Phase II Project”). Upon City’s receipt of the 513 Whittier Property Notice, City shall have the right to obtain an appraisal of the fair market value of the 513 Whittier Property (the “513 Whittier Property Appraisal”), provided that City notifies Guarantor of such intention, in writing (the “City Appraisal Notice”), within thirty (30) days after City’s receipt of the 513 Whittier Property Notice, and thereafter obtains the 513 Whittier Property Appraisal within forty-five (45) days after providing the City Appraisal Notice. If City has timely elected to obtain and timely obtains the 513 Whittier Property Appraisal, (i) Guarantor shall be permitted to redesign the Phase II Project with the Redesigned Phase II Project if the sale price offered for the 513 Whittier Property by the 513 Whittier Property Owner exceeds the fair market value of the 513 Whittier Property, as set forth in the 513 Whittier Property Appraisal, by more than ten percent (10%), and (ii) if Guarantor is permitted to redesign the Phase II Project in accordance with the foregoing clause (i), all of the times for performance in the Schedule of Performance shall be automatically extended for the period of time commencing on the date of City’s receipt of the 513 Whittier Property Notice and ending on the date on which City provides to Guarantor a copy of the 513 Whittier Property Appraisal. Guarantor’s development of a Redesigned Phase II Project shall be conditioned upon and subject to compliance with the Montebello Zoning Code and other applicable laws relating to use and development of the subject project site, and Guarantor’s receipt of any and all permits, approvals, and/or discretionary land use entitlements from the City or other governmental entities and required to develop the Redesigned Phase II Project.

5. This Guaranty shall remain in effect until the “Termination Date,” which shall be the earlier of (i) the date a Certificate of Completion is issued by the City for the Phase II Project, or (ii) the date Guarantor has paid to City the Default Payment or such lesser amount as set forth in the City Payment Notice.

6. Upon Guarantor’s acquisition of all or any portion of the parcels that comprise the Phase II Site, Guarantor shall permit the City to record a standard form deed of trust on the Phase II Site to secure Guarantor’s repayment of the Default Payment pursuant to the terms of this Guaranty (the “Phase II Site Deed of Trust”). City agrees to subordinate the Phase II Site Deed

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of Trust to any acquisition financing obtained by Guarantor. Promptly following the Termination Date, City shall reconvey the Phase II Site Deed of Trust.

7. This Guaranty shall not be released, modified or affected by failure or delay on the part of City to enforce any of the rights or remedies of the City hereunder, whether pursuant to the terms thereof or at law or in equity.

8. On request by City from time to time, Guarantor agrees to provide City with a current balance sheet for Guarantor; provided, however, that Guarantor shall not be obligated to provide its balance sheet to City more than twice each year. In addition, if City requests a balance sheet as of the end of a fiscal quarter, City agrees that Guarantor will have a minimum of sixty (60) days after the end of such fiscal quarter in which to provide the balance sheet. Finally, if City requests a balance sheet as of the end of a fiscal year, City agrees that Guarantor will have a minimum of ninety (90) days after the end of such fiscal year to provide the balance sheet.

Guarantor's balance sheets are to be prepared in accordance with generally accepted accounting principles (“GAAP”). Guarantor represents and warrants that all such balance sheets shall be true and correct statements, in all material respects, of Guarantor's financial condition.

9. The liability of Guarantor under this Guaranty is a guaranty of payment and performance and not of collectability, and is not conditioned or contingent upon the genuineness, validity, regularity or enforceability of this Guaranty, or the pursuit by City of any remedies which it now has or may hereafter have with respect thereto, at law, in equity or otherwise.

10. Guarantor has been advised of and hereby waives and agrees not to assert or take advantage of to the extent permitted by law: (i) any statute of limitations affecting Guarantor’s liability hereunder or the enforcement thereof; (ii) any right or defense that may arise by reason of the incapability, lack of authority, or lack of financial capacity Guarantor or any other person; (iii) all principles or provisions of law which conflict with the terms of this Guaranty, and (iv) any other rights and defenses that are or may become available to Guarantor by reason of Sections 2787 through 2855, inclusive, of the California Civil Code. Guarantor agrees that Guarantor’s obligations shall not be affected by any circumstances which constitute a legal or equitable discharge of a guarantor or surety.

11. Guarantor has been advised of and hereby expressly waives any and all benefits under California Civil Code § § 2809, 2810, 2815, 2819, 2821, 2822, 2824, 2845, 2847, 2849, 2850, 2855, 2899 and 3433, and the second sentence of California Civil Code § 2822(a). In addition, Guarantor agrees that Guarantor shall have no right of subrogation or any right of contribution against any other guarantor unless and until all amounts due hereunder have been paid in full and all other obligations hereunder have been satisfied. Guarantor further agrees that, to the extent the waiver of Guarantor’s rights of subrogation and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation Guarantor may have shall be junior and subordinate to any rights City may have, and any rights of contribution Guarantor may have against any other guarantor shall be junior and subordinate to any rights City may have against such other guarantor.

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12. The obligations of Guarantor under this Guaranty shall not be altered, limited or affected by any case, voluntary or involuntary, involving the bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of Guarantor or any defense which Guarantor may have by reason of order, decree or decision of any court or administrative body resulting from any such case. City shall have the sole right to accept or reject any plan on behalf of Guarantor proposed in such case and to take any other action which Guarantor would be entitled to take, including, without limitation, the decision to file or not file a claim. Guarantor acknowledges and agrees that any payment which accrues with respect to Guarantor’s obligations which accrue after the commencement of any such proceeding (or, if any such payment ceases to accrue by operation of law by reason of the commencement of such proceeding, such payment as would have accrued if said proceedings had not been commenced) shall be included in Guarantor’s obligations hereunder because it is the intention of the parties that said obligations should be determined without regard to any rule or law or order which may relieve Guarantor of any of its obligations. Guarantor hereby permits any trustee in bankruptcy, receiver, and debtor-in-possession, assignee for the benefit of creditors or similar person to pay City, or allow the claim of City in respect of, any such payment accruing after the date on which such proceeding is commenced. Guarantor hereby assigns to City Guarantor’s right to receive any payments from any trustee in bankruptcy, receiver, debtor-in- possession, assignee for the benefit of creditors or similar person by way of dividend, adequate protection payment or otherwise.

13. Guarantor hereby agrees to indemnify, protect, defend and hold City harmless from and against, all losses, costs and expenses including, without limitation, all interest, default interest, post- petition bankruptcy interest and other post-petition obligations, late charges, court costs and attorneys' fees, which may be suffered or incurred by City in enforcing or compromising any rights under this Guaranty.

14. Any obligation of Guarantor under this Guaranty may be performed by an affiliate of Guarantor. City agrees to accept any such performance, and agrees that such performance shall fully satisfy the respective obligation.

15. All notices, consents, requests, approvals and authorizations (collectively, “Notices”) required or permitted under this Guaranty shall only be effective if in writing. All Notices shall be sent (A) by registered or certified mail (return receipt requested), postage prepaid, or (B) by Federal Express, U.S. Post Office Express Mail, or similar nationally recognized overnight courier which delivers only upon signed receipt of the addressee, or (C) by e-mail with a copy sent within 24 hours in the manner provided in clause (B) above, and addressed as follows or at such other address, and to the attention of such other person, as the parties shall give notice as herein provided:

To Guarantor:

Cesar Chavez Foundation
Attn: Legal Department
29700 Woodford Tehachapi Road
Keene, CA 93531
Attention: Paul S. Park

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With copy to:

Rutan & Tucker, LLP
18575 Jamboree Road, 9th Floor
Irvine, CA 92612
Attention: Patrick D. McCalla
To City:

With copy to:

Alvarez-Glassman & Colvin
13181 Crossroads Pkwy, North Tower, Suite 400
City of Industry, CA 91746
Attention: Arnold M. Alvarez-Glassman

16. Guarantor represents and warrants to City as follows: (a) The execution, delivery and performance by Guarantor of this Guaranty have been duly authorized by all necessary corporate action. (b) Guarantor has the full power, authority and legal right to execute and deliver, and to perform and observe the provisions of, this Guaranty including the payment of all moneys hereunder. This Guaranty constitutes the legal, valid and binding obligation of Guarantor enforceable in accordance with its terms, except as enforcement thereof may be limited by (a) bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting creditors’ rights generally or (b) the non-availability of equitable remedies which are discretionary with the courts. (c) No consent of any other person, including, without limitation, any creditors of Guarantor, and no license, permit, approval or authorization of, exemption by, notice or report to, or registration, filing or declaration with, any governmental authority is required by Guarantor in connection with this Guaranty or the execution, delivery, performance, validity or enforceability of this Guaranty and all obligations required hereunder. This Guaranty has been duly executed and delivered by Guarantor, and constitutes the legally valid and binding obligation of Guarantor enforceable against such Guarantor in accordance with its terms. (d) The execution, delivery and performance of this Guaranty will not violate any provision of any existing law or regulation binding on Guarantor, or any order, judgment, award or decree of any court, arbitrator or governmental authority binding on Guarantor, or of any mortgage, indenture, lease, contract or other agreement, instrument or undertaking to which Guarantor is a party or by which Guarantor or any of Guarantor’s assets may be bound, and will not result in, or require, the creation or imposition of any lien on any of Guarantor’s property, assets or revenues pursuant to the provisions of any such mortgage, indenture, lease, contract, or other agreement, instrument or undertaking. (e) To the actual knowledge of the undersigned, all information and documentation provided by Guarantor to City regarding the financial condition of Guarantor is true, correct, and complete in all material respect as of the date such information was provided to City and as of the date hereof. (f) Neither the execution or delivery of this Guaranty, nor the consummation of the transactions herein contemplated, nor the compliance with the terms and provisions hereof, conflict or will conflict with or result in a breach of any of the terms, conditions or provisions of any law, order, writ, injunction or decree of any court or Governmental Authority, or of any agreement or

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instrument to which Guarantor is a party of by which it is bound, or constitutes or will constitute a default thereunder.

17. This Guaranty shall be binding upon Guarantor, Guarantor’s heirs, representatives, administrators, executors, successors and assigns and shall inure to the benefit of and shall be enforceable by City, its successors, endorsees and assigns. As used herein, the singular shall include the plural, and the masculine shall include the feminine and neuter and vice versa, if the context so requires.

18. The term “Guarantor” whenever used herein refers to and means the Guarantor specifically named in the preamble hereof and also any assignee or successor to the interests of said Guarantor, whether by assignment or otherwise.

19. In case suit is brought because of the breach of any agreement or obligation contained in this Guaranty, and a breach is established, the prevailing party shall be entitled to recover all expenses incurred in connection with such suit, including reasonable attorneys’ fees.

20. Any action to declare or enforce any rights or obligations under this Guaranty may be commenced by City in the Superior Court of Los Angeles County. Guarantor hereby consents to the jurisdiction of such court for such purposes and agrees that any notice, complaint or other legal process therein may be delivered to Guarantor in accordance with the above notice provisions and that any notice, complaint or other legal process so delivered shall constitute adequate notice and service of process for all purposes and shall subject Guarantor to the jurisdiction of such court for purposes of adjudicating any matter related to this Guaranty.

21. TO THE EXTENT ALLOWED BY APPLICABLE LAW, GUARANTOR AND

CITY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE

RIGHT EITHER OF THEM OR THEIR HEIRS, PERSONAL REPRESENTATIVES,

SUCCESSORS OR ASSIGNS MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY

LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY

OR ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION

HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. If the jury waiver set forth in this section is not enforceable, then any claim or cause of action arising out of or relating to this Guaranty shall be resolved by judicial reference pursuant to Code of Civil Procedure Section 638 et seq. before a referee sitting without a jury, such referee to be mutually acceptable to the parties or, if no agreement is reached, by a referee appointed by the Presiding Judge of the Superior Court of the County of Los Angeles. This section shall not restrict City from exercising pre- judgment remedies under applicable law.

22. This Guaranty shall be governed and construed in accordance with the laws of the State of California.

23. Every provision of this Guaranty is intended to be severable. In the event any term or provision hereof is declared to be illegal or invalid for any reason whatsoever by a court of