Orange City Council
October 11, 2022

AFFORDABLE HOUSING AGREEMENT
(Villa St. Joseph - 480 South Batavia Street)
THIS AFFORDABLE HOUSING AGREEMENT (this “ Agreement”), dated as of ____________ __, 2022, is entered into by and between the CITY OF ORANGE, a municipal corporation of the State of California (“City”) and MERCY HOUSING CALIFORNIA 107, L.P., a California limited partnership (“Developer”). City and Developer agree as follows:

ARTICLE I. SUBJECT OF AGREEMENT
Section 1.01 Purpose of the Agreement
The purpose of this Agreement is to provide for the City’s assistance in financing the acquisition, development and operation of forty-nine (49) affordable rental housing units for Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households, and one (1) manager’s unit, through the adaptive reuse by Developer of a portion of the existing Motherhouse (former convent) building located in an airspace parcel on the Property to be acquired by the Developer. The development and use of the Property pursuant to this Agreement, and the fulfillment generally of this Agreement, are in the vital and best interests of the City of Orange and the health, safety, morals, and welfare of its residents, and in accord with the public purposes and provisions of applicable federal, state, and local laws and requirements. Developer will acquire an interest in the Property, consisting of a long-term lease of an airspace parcel together with fee title to improvements therein, and City will assist Developer in paying the cost of acquiring the Property and rehabilitating the Improvements (as defined below) and the Developer will acquire, rehabilitate, and operate the Improvements on the Property, all in accordance with the terms and conditions of this Agreement.

Section 1.02 Definitions
For purposes of this Agreement, the following capitalized terms will have the following meanings:
“Acquisition and Development Costs” means the total cost of acquiring the Property and developing, constructing, and rehabilitating the Improvements thereon, as set forth in the Project Budget.
“Affiliate” means any Person directly or indirectly controlling, controlled by or under common control with another Person. The term “control” as used in the immediately preceding sentence, means the power to direct the management or the power to control election of the board of directors. It will be a presumption that control with respect to a corporation or limited liability company is the right to exercise or control, directly or indirectly, more than fifty percent (50%) of the voting rights attributable to the controlled corporation or limited liability company, and, with respect to any individual, partnership, trust, other entity or association, control is the possession, indirectly or directly, of the power to direct or cause the direction of the management or policies 253
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of the controlled entity. For purposes of this definition, each general partner will be considered an “Affiliate” of Developer.
“Affordable Rent” has the meaning set forth in California Health and Safety Code Section 50053. Rents for the Units will not exceed the respective amounts set forth in the Agreement Containing Covenants for each of the Units designated therein for occupancy by Extremely Low Income, Very Low Income and Low Income Senior Citizen Households. “Agreement Containing Covenants ” means the Agreement Containing Covenants (Including Rental Restrictions for each of the Units designated therein for occupancy by Extremely Low Income, Very Low Income and Low Income Senior Citizen Households), substantially in the form attached to this Agreement as Attachment No. 7.
“Anti-Terrorism Laws ” means all laws relating to terrorism or money laundering, including, without limitation, the Currency and Foreign Transactions Reporting Act of 1970, Pub.

L. No. 91-508, 84 Stat. 1305 (1970), as amended from time to time. “Annual Project Budget” has the meaning given in paragraph b of Section 5.02. “Approved Title Conditions ” means title that is subject to current property taxes and assessments, Senior Loan, and easements and other encumbrances specifically approved by the City Manager.
“Assignment of Agreements” means a document substantially in the form attached to this Agreement as Attachment No. 14, which is incorporated herein by this reference. “Assignment of Rents and Leases” means a document substantially in the form attached to this Agreement as Attachment No. 13, which is incorporated herein by this reference. “City” means the City of Orange, California, a municipal corporation of the State of California, and any assignee of or successor to its rights, powers and responsibilities. “City Deed of Trust ” means the Subordinated Deed of Trust, Security Agreement and Fixture Filing (With Assignment of Rents), in which Developer is the Trustor and City is the Beneficiary, which secures the City Loans, substantially in the form attached to this Agreement as Attachment No. 12.
“City Loans” means, individually and collectively, the LMIHAF Loan, the In Lieu Fees Loan, and the HOME Loan.
“City Loan Documents ” means the instruments described as such in the Method of Financing.
“Completion” means the point in time when all of the following will have occurred:
(1) issuance of a permanent certificate of occupancy by the City of Orange; (2) recordation of a 254
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Notice of Completion by Developer or its contractor; (3) certification by the project architect that construction and rehabilitation of the Improvements (with the exception of minor “punch list” items) has been completed in a good and workmanlike manner and substantially in accordance with the approved Plans; (4) payment, settlement or other extinguishment, discharge, release, waiver, bonding or insuring against any mechanic’s liens that have been recorded or stop notices that have been delivered; (5) the time for Developer’s contractor, suppliers and subcontractors to file a claim pursuant to Civil Code Sections 3115-3117 has expired; (6) the Improvements comply with the requirements of the HOME Regulations (including the property standards under 24 CFR

92.251); and (7) Developer has submitted to the City the information needed to complete the “Rental Set Up and Completion Form – HOME Program” required by HUD. “Conditions” means, with respect to the Property, the condition of the soil, geology, improvements, the presence of known or unknown faults or defects, or Hazardous Substances, the suitability of the Property for its intended uses, or the condition of any related public improvements.
“Construction Financing Event ” means the point in time when (i) all conditions precedent to the Construction Financing Event as set forth in the Method of Financing (Attachment No. 3) have been satisfied; and (ii) the Construction Loan Deed of Trust and other Construction Loan documents are recorded.
“Construction Financing Event Date ” means the date on which the Construction Financing Event is scheduled to take place.
“Construction Loan” means the Construction Period loan to be made to Developer by Umpqua Bank, or another institutional lender acceptable to the City (“Construction Lender”) at the time of the Construction Financing Event, secured by the Construction Loan Deed of Trust.

The Construction Loan is proposed to be made to Developer from the proceeds of certain tax- exempt and taxable bonds as further described in the Method of Financing. “Construction Loan Deed of Trust ” means the first priority deed of trust securing the Construction Loan.
“Construction Period ” means the period of time commencing upon the Construction Financing Event and ending at Conversion.
“Conversion” means the point in time when the Permanent Financing has been funded, the total Limited Partner Capital Contribution has been funded (subject to adjustment as provided in the Limited Partnership Agreement and less that portion, not to exceed 10%, of the Limited Partner Capital Contribution that will be funded upon receipt of Form(s) 8609), and the Construction Loan has been repaid in full.
“Developer Equity” means funds provided by Developer for payment of Acquisition and Development Costs and does not include the Construction Loan, the Permanent Financing, the City Loans or any other borrowed funds, and includes the Deferred Developer Fee (as defined in 255
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the Method of Financing), the Limited Partner Capital Contribution and other funds of the Developer.
“Environmental Indemnity” means an instrument substantially in the form attached to this Agreement as Attachment No. 15.
“Escrow Agent ” means Commonwealth Land Title Company or another escrow agent mutually acceptable to City and Developer.
“Extremely Low Income” means household income that does not exceed the maximum income set forth in California Health and Safety Code Section 50106. “Force Majeure” or “Force Majeure Event” means the following events, provided that they actually delay and interfere with the timely performance of the matter to which it would apply and despite the exercise of diligence and good business practices are or would be beyond the reasonable control of the party claiming such interference: War; insurrection; strikes; lock-outs; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; acts of terrorism, epidemics; pandemics; quarantine restrictions; freight embargoes; lack of transportation; governmental restrictions or priority; litigation including litigation challenging the validity of this transaction or any element thereof; unusually severe weather; inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor, or suppliers; acts of the other party; acts or failure to act of any Governmental Authority (except acts or failure to act of the City will not excuse performance by the City); the imposition of any applicable moratorium by a Governmental Authority; or any other causes which despite the exercise of diligence and good business practices are or would be beyond the reasonable control of the party claiming such delay and interference.

Notwithstanding the foregoing, none of the foregoing events will constitute a Force Majeure Event unless and until the party claiming such delay and interference delivers to the other party written notice describing the event, its cause, when and how such party obtained knowledge, the date the event commenced, and the estimated delay resulting therefrom. Any party claiming a Force Majeure Delay will deliver such written notice within fifteen (15) days after it obtains actual knowledge of the event.
“Force Majeure Delay” means any delay in taking any action required by this Agreement, proximately caused by the occurrence of any Force Majeure Event. “Governmental Approvals” means and includes any and all general plan amendments, zoning approvals or changes, required approvals and certifications under the California Environmental Quality Act, tentative and final tract maps, variances, conditional use permits, demolition permits, excavation/foundation permits, grading permits, building permits, inspection reports and approvals, certificates of occupancy, and other approvals, permits, certificates, authorizations, consents, orders, entitlements, filings or registrations, and actions of any nature whatsoever required from any Governmental Authority in order to commence and complete the construction of the Project.
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“Governmental Authority” means the United States, the State of California, the County of Orange, the City of Orange or any other political subdivision in which the Property is located, and any court or political subdivision, City or instrumentality having jurisdiction over the Property. “Hazardous Substances” has the meaning set forth in the Environmental Indemnity. “HOME Loan” means the loan of HOME Program funds made by the City to Developer pursuant to this Agreement, in the amount set forth in the final approved Project Budget, not to exceed the amount of Six Hundred Fifty-One Thousand Two Hundred Forty-Four Dollars ($651,244) which is evidenced by the HOME Note and secured by the City Deed of Trust and the other City Loan Documents having a lien on the Property that is junior in priority to the lien of the Senior Loan Deed of Trust.
“HOME Note” means the Promissory Note evidencing the HOME Loan, substantially in the form attached to this Agreement as Attachment No. 11. “HOME Regulations” means 24 CFR Part 92, as amended from time to time. “HOME Regulatory Agreement ” means the Agreement Containing HOME Program Requirements, substantially in the form attached to this Agreement as Attachment No. 8. “HOME Rents” means maximum rents, including a reasonable utility allowance for utilities and services (excluding telephone) as follows:

1. For each of the Very Low Income HOME Units, the rent must meet either (a) or (b) of the following rent requirements:
(a) The rent does not exceed the lesser of (1) 30 percent of the annual income of a family whose income equals 50 percent of the median income for the area, as determined by HUD, with adjustments for smaller and larger families, as provided by HUD; (2) the fair market rent for existing housing for comparable units in the area as established by HUD under 24 CFR 888.111; or
(b) The rent does not exceed 30 percent of the family’s adjusted income. If the unit receives federal or state project-based rental subsidy and the family pays as contribution toward rent not more than 30 percent of the family’s adjusted income, then the maximum rent (i.e., tenant contribution plus project-based rental subsidy) is the rent allowable under the federal or state project-based rental subsidy program.

2. For each of the Low Income HOME Units, the rent may not exceed the lesser of:
(a) The fair market rent for existing housing for comparable units in the area, as established by HUD under 24 CFR 888.111; and
(b) A rent that does not exceed 30 percent of the adjusted income (as that term is defined in 24 CFR 92.203) of a family whose annual income (as that term is defined in 24 CFR 257
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92.203) equals 65 percent of the median income for the area, as determined by HUD, with adjustments for the number of bedrooms in the unit.
“HUD” means the United States Department of Housing and Urban Development. “Improvements” means the residential development to be rehabilitated and constructed on the Property, consisting of 6 studio units, 43 one-bedroom units, 1 two-bedroom manager’s unit, and ancillary facilities, as described in plan approvals and Governmental Approvals issued or to be issued by the City.
“In Lieu Fees Funds ” means a portion of the funds derived from the City’s In Lieu Fee affordable housing ordinance.
“In Lieu Fees Loan ” means the loan made by the City to Developer pursuant to this Agreement, in the amount set forth in the final approved Project Budget, not to exceed the amount of Three Hundred Seventy Two Thousand Seven Hundred Fifty-Six Dollars ($372,756) which is evidenced by the In Lieu Fees Note and secured by the City Deed of Trust and the other City Loan Documents having a lien on the Property that is junior in priority to the lien of the Senior Loan Deed of Trust.
“In Lieu Fees Note ” means the Promissory Note evidencing the In Lieu Fees Loan, substantially in the form attached to this Agreement as Attachment No. 10. “Investor Limited Partner” means Wincopin Circle LLLP or any other Person acceptable to Developer and City who will be a limited partner in Developer’s limited partnership pursuant to the Limited Partnership Agreement and who will be allocated the Low Income Housing Tax Credits and own a 99.99% interest in the Developer, and any successor and assign thereof as permitted by the Limited Partnership Agreement.
“Legal Description ” means the legal description of the Property attached to this Agreement as Attachment No. 2.
“Limited Partner Capital Contribution” means the Developer Equity provided from the allocation of the Low Income Housing Tax Credits as set forth in the Method of Financing. “Limited Partnership” means the single purpose entity referred to herein as “Developer”, formed for the syndication of the Low Income Housing Tax Credits and ownership of the Project. “Limited Partnership Agreement ” means the limited partnership agreement governing the Limited Partnership and includes the Limited Partnership Agreement as amended and restated on the admission of the Investor Limited Partner.
“LMIHAF” means the Low and Moderate Income Housing Asset Fund, established and maintained by the City pursuant to California Health and Safety Code Sections 34176 and 34176.1. 258
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“LMIHAF Loan ” means the loan made by the City to Developer pursuant to this Agreement, in the amount set forth in the final approved Project Budget, not to exceed the amount of Five Hundred Seventy Six Thousand Dollars ($576,000) which is evidenced by the LMIHAF Note and secured by the City Deed of Trust and the other City Loan Documents having a lien on the Property that is junior in priority to the lien of the Senior Loan Deed of Trust. “LMIHAF Note” means the Promissory Note evidencing the LMIHAF Loan, substantially in the form attached to this Agreement as Attachment No. 9. “Low Income ” means the maximum income given to “lower income” households in California Health and Safety Code Section 50079.5.
“Low Income HOME Tenant” means a senior citizen household whose household income does not exceed 80% of the area median income adjusted for household size, as determined annually by the united states department of housing and urban development. “Low Income HOME Unit” means one of the Units designated in the HOME Regulatory Agreement to be occupied by a Low Income HOME Tenant at HOME Rents. “Low Income Housing Tax Credits” means tax credits authorized by the Tax Reform Act of 1986 and governed by Section 42 of the Internal Revenue Code. “Maintenance Program” has the meaning given in Section 5.03. “Management Plan” has the meaning given in paragraph a. of Section 5.02. “Managing General Partner ” means Mercy Housing California 107 LLC, a California limited liability company, and its successors and assigns permitted under the terms of this Agreement. Mercy Housing California 107 LLC is the sole general partner of Mercy Housing California 107, L.P.
“Method of Financing” means Attachment No. 3 to this Agreement. “Notice of Affordability Restrictions” means the Notice of Affordability Restrictions on Transfer of Real Property, substantially in the form attached to this Agreement as Attachment No.

6. “Permanent Financing ” means the loans and other sources of permanent financing identified in the Method of Financing (Attachment No. 3). “Permanent Period” means the period of time commencing at Conversion. “Permitted Transfer ” means any of the following, provided (except for subsection f. below) Developer or a general partner of Developer, or an Affiliate of such general partner, retains day-to-day control over management and operations of the Property and the Improvements and 259
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further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti- Terrorism Laws:
a. An assignment of this Agreement and Developer’s interests in the Property to an Affiliate or a conveyance back from the Affiliate to Developer; b. A conveyance of a security interest in the Property or any portion thereof or interest therein, in connection with a Senior Loan approved by the City; c. The inclusion of equity participation in the Project by addition of limited partners to the Limited Partnership or similar mechanism, and any transfers of limited partnership interests in Developer’s partnership;
d. The lease for occupancy of any part of the Improvements on the Property in accordance with this Agreement;
e. The granting of easements or permits to facilitate the development of the Property in accordance with this Agreement;
f. The withdrawal, removal and/or replacement of a general partner of the Limited Partnership pursuant to the terms of the Limited Partnership Agreement, or a conveyance of Developer’s interest in the Property and the Improvements and a transfer of limited partnership interests to a general partner pursuant to the option provided to that partner in Developer’s partnership agreement, will not constitute a default under this Agreement or any of the City Loan Documents, nor will such actions accelerate the maturity of the City Loans, provided that, unless the substitute general partner is an entity directly or indirectly controlled by Enterprise Community Asset Management, Inc., any required substitute general partner is reasonably acceptable to the City, as evidenced by the City’s written consent, and is selected with reasonable promptness; and
g. Any transfer approved in writing by City Manager or designee, at his or her sole discretion.

Transfers described in clauses a, b, or c will be subject to the reasonable approval of the City Manager or designee; provided that, the City approves the transfer of limited partner interests in Developer’s partnership, so long as such transfer is not a result of a resyndication of the Low Income Housing Tax Credits and does not otherwise result in increased equity participation in Developer, and further provided that such transfer is not to a Prohibited Person or would otherwise violate Anti-Terrorism Laws.
“Person” means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, domestic or foreign. “Plans” means the architectural and construction plans and drawings prepared on behalf of Developer for Developer’s use for the Project in accordance with this Agreement. 260
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“Prohibited Person” means any of the following:
a. a Person that is listed in or is otherwise subject to the prohibitions of, any Executive Order relating to money laundering or anti-terrorism;
b. a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in or is otherwise subject to the prohibitions of, any Executive Order relating to money laundering or anti-terrorism;
c. a Person or entity with whom Developer or Investor Limited Partner is prohibited from dealing or otherwise engaging in any transaction by Anti-Terrorism Laws; d. a Person that is named as a “specially designated national and blocked person” on the most current list published by the Office of Foreign Asset Control of the U.S.

Treasury Department.
“Project” means the financing, planning, construction, rehabilitation and use of the Property and the Improvements as provided in this Agreement. “Project Budget” means the schedule of sources and uses attached to this Agreement as Attachment No. 5.
“Property” means the real property described in the legal description attached to this Agreement as Attachment No. 2, comprised of a long-term lease of an airspace parcel (the “Airspace Lease”) together with fee title to improvements and fixtures located at the Airspace Lease premises, including without limitation that certain 50 unit apartment complex and all other buildings and structures located at the Air Space Lease premises (the “Improvements”). “Quarterly Report” has the meaning given in paragraph c of Section 5.02. “Release of Construction Covenants ” means the certificate to be issued by the City in accordance with Section 4.18 of this Agreement.
“Restricted Period ” means the period commencing at recordation of the Agreement Containing Covenants and continuing until the date that is fifty-five (55) years after Conversion.

Notwithstanding, the Restricted Period for the HOME Units will be as set forth in the HOME Regulatory Agreement.
“Schedule of Performance ” means the document attached to this Agreement as Attachment No. 4.
“Seller Carryback Loan ” means the carryback loan made to Developer by the seller of the Improvements in connection with the agreement of the Developer to acquire the Property. “Seller Carryback Loan Deed of Trust ” means the deed of trust securing the Seller Carryback Loan.
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“Senior Citizen Household ” means a household where at least one person in residence qualifies for occupancy under the California Tax Credit Allocation Committee’s regulations applicable to the Project and intends to reside in the unit as his or her primary residence on a permanent basis, and where any other person residing in the unit is a “qualified permanent resident” or a “permitted health care resident” as provided in the Unruh Civil Rights Act, California Civil Code Section 51 et seq., or the Federal Fair Housing Act 42 USC Section 3607, and such household’s occupancy is in compliance with all applicable federal, state and local laws and regulations governing the use and occupancy of the Project. All of the units shall be rented to Senior Citizen Households.
“Senior Lender” means the maker of a Senior Loan, and an approved construction lender, credit enhancer or construction period guaranty facility. “Senior Loan Deed of Trust ” means, during the Construction Period, the Construction Loan Deed of Trust, and during the Permanent Period, the HCD NPLH Loan and OCHCD Loans Deeds of Trust as described in the Method of Financing (Attachment No. 3). “Senior Loan” means, during the Construction Period, the Construction Loan, and during the Permanent Period, the HCD NPLH Loan and OCHCD Loans Deeds of Trust as described in the Method of Financing (Attachment No. 3).
“Senior Loan Documents” means, as applicable, the Construction Loan Deed of Trust, the HCD NPLH Loan Deed of Trust, the OCHCD Loans Deed of Trust, loan agreements, promissory notes, financing statements, guaranties, security agreements, assignments, and similar documents and instruments to be executed by Developer in connection with a Senior Loan. “Site Map” means the document which is attached to this Agreement as Attachment No.

1. “Subordination Agreement ” means an instrument in a form agreed to by the City Manager or designee and Senior Lender, which subordinates the City Loans, but not the Agreement Containing Covenants or the HOME Regulatory Agreement, to a Senior Loan. “Title Company” means Commonwealth Land Title Company or another title insurance company mutually acceptable to City and Developer.
“Title Insurance Policies ” means and include the following ALTA extended coverage policies of title insurance issued by the Title Company, subject to the Approved Title Conditions:
a. A lender’s policy of leasehold title insurance in favor of the Construction Lender, together with such endorsements as the Construction Lender may reasonably require, insuring the lien of the Construction Loan, in the amount of the Construction Loan (the “ Construction Lender’s Title Policy”); and
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b. A lender’s policy or policies of title insurance in favor of City, together with such endorsements as City may reasonably require, insuring the lien of the City Deed of Trust in the cumulative amount of the City Loans (the “City’s Title Policy”). “Transfer” means:
a. The sale, agreement to sell, transfer or conveyance of the Property, the Project, or any portion thereof or interest therein (including, without limitation, a beneficial interest), whether voluntary, involuntary, by operation of law or otherwise, the execution of any installment sale contract or similar instrument affecting all or a portion of the Property or Project, or the lease of all or substantially all of the Property or Project.
b. “Transfer” also includes the transfer, assignment, hypothecation or conveyance of legal or beneficial ownership of an interest in Developer, or a conversion of Developer to an entity form other than that of Developer at the time of execution of this Agreement, except that, a cumulative change in ownership interest of a general partner of the Developer of forty-nine percent (49%) or less will not be deemed a “Transfer” for purposes of this Agreement. “UCC-1” means a UCC-1 Financing Agreement naming the City as creditor and Developer as debtor.
“Unit” means each of the rental housing units to be developed as part of the Project in accordance with this Agreement.
“Very Low Income” means household income that does not exceed the maximum income set forth in California Health and Safety Code Section 50105. “Very Low Income HOME Tenant ” means a tenant whose household income does not exceed 50% of the area median income adjusted for household size, as determined annually by the United States Department of Housing and Urban Development. “Very Low Income HOME Unit” means one of the Units designated in the HOME Regulatory Agreement to be occupied by a Very Low Income HOME Tenant at HOME Rents.

Section 1.03 The Property
The “Property” is that property in the City of Orange as illustrated on the “Site Map” (attached hereto as Attachment No. 1) and as described in the “Legal Description of the Property” (attached hereto as Attachment No. 2).

Section 1.04 The City
a. The City is a municipal corporation of the State of California. b. The address of the City for purposes of receiving notices pursuant to this Agreement is as follows: 300 E. Chapman Avenue, Orange, California 92866, Attn: City Manager. 263
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c. “City” as used in this Agreement includes the City of Orange and any assignee or successor to its rights, powers and responsibilities.

Section 1.05 The Developer
a. Developer is Mercy Housing California 107, L.P., a California limited partnership.

The address of Developer for purposes of receiving notices pursuant to this Agreement is as follows:

Mercy Housing California 107, L.P.
1500 S. Grand Avenue, Suite 100
Los Angeles, California 90015
Attn: Erika Villablanca
Copies of notices to Developer will be delivered at the same time to the Investor Limited Partner at the address provided in the LMIHAF Note.
b. Whenever the term “Developer” is used herein, such term means and includes: (1) the Developer as of the date hereof; and (2) any assignee of or successor to its rights, powers and responsibilities approved by the City or permitted by this Agreement.

Section 1.06 Assignments and Transfers
a. The qualifications and identity of the Developer are of particular concern to the City. It is because of those qualifications and identity that the City has entered into this Agreement with the Developer. No voluntary or involuntary successor in interest of the Developer will acquire any rights or powers under this Agreement except as expressly set forth herein. b. The Developer will not assign all or any part of this Agreement without the prior written approval of the City. The City agrees to reasonably give such approval if, in the reasonable determination of the City, the proposed assignee is comparable in all material respects (including experience, character and financial capability) to the Developer. Any such change (or assignment of this Agreement in connection therewith) will be by instruments satisfactory to the City Manager (or designee), and be subject to the approval by the City Manager (or designee) of evidence of the proposed assignee’s qualifications to meet the obligations of the Developer under this Agreement. c. For the reasons cited above, except for any Permitted Transfer as set forth in subsection f. in the definition of “Permitted Transfer” above, Developer represents and agrees for itself and any successor in interest that without the prior written approval of the City, which will not be unreasonably withheld, there will be no cumulative change in ownership interest of any general partner of greater than 49%, by any method or means. d. Developer will promptly notify the City of any and all changes whatsoever in the identity of the parties in control of Developer or the degree thereof, of which it or any of its officers have been notified or otherwise have knowledge or information. This Agreement may be 264
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terminated by the City, and the City may exercise its remedies pursuant to the City Loan Documents, if there is any significant change (voluntary or involuntary) in membership, executive management or control of Developer (other than such changes occasioned by the death or incapacity of any individual or a Permitted Transfer). “Significant change” as used in the preceding sentence is any change that results (directly or indirectly) in a change of the day to day management of Developer following the date of this Agreement. e. The Developer will not, except for Permitted Transfers or as permitted by this Agreement, make or attempt to make a Transfer, without prior written approval of the City, except as expressly permitted by this Agreement and the other City Loan Documents. Consent to one such transaction will not be deemed to be a waiver of the right to require consent to future or successive transactions. Proposed transferees must have the qualifications and financial responsibility necessary and adequate as may be reasonably determined by the City, to fulfill Developer’s obligations undertaken in this Agreement. A proposed transferee, by instrument in writing satisfactory to the City and in form recordable among the land records, for itself and its successors and assigns, and for the benefit of the City must expressly assume all of Developer’s obligations under this Agreement and agree to be subject to all conditions and restrictions applicable to the Developer in this Agreement. There must be submitted to the City for review all instruments and other legal documents proposed to affect any such transfer; and if approved by the City its approval will be indicated to Developer in writing.
f. In the absence of specific written agreement by the City, no Transfer, or approval thereof by the City, will be deemed to relieve Developer or any other party from any obligations under this Agreement.
g. Notwithstanding section 106.b., Developer will have the right to execute deeds of trust and other instruments granting a security interest in the Property for the purposes of financing the Acquisition and Development Costs, as described in Article III of this Agreement and the Method of Financing attached hereto as Attachment No. 3.

ARTICLE II. ACQUISITION OF THE PROPERTY BY DEVELOPER
Section 2.01 Condition of the Property
a. No person acting on behalf of the City is authorized to make, and by execution of this Agreement, Developer acknowledges that neither the City nor any person acting on behalf of the City has made any representation, agreement, statement, warranty, guarantee or promise regarding the zoning, construction, physical condition or other status or Condition of the Property, except as otherwise expressly provided in this Agreement. b. Developer acknowledges and agrees that, except as expressly set forth in this Agreement, the City makes no representations and warranties, express or implied, as to the Property, the physical condition of the Property, and any Condition which may exist on, in or under the Property. Other than the representations and warranties set forth in this Agreement, Developer hereby expressly acknowledges and agrees that it is relying solely upon its inspections, 265
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examination, and evaluation of the Property.
c. It will be the sole responsibility of Developer, at Developer’s expense, to investigate and determine all conditions of the Property and its suitability for the uses to which the Property is to be put in accordance with this Agreement. If the conditions of the Property are not in all respects entirely suitable for the use or uses to which the Property will be put, then it is the responsibility and obligation of Developer, without cost to the City, to take such action or cause such action to be taken, as may be necessary to place the Property in all respects in a condition entirely suitable for its development and use in accordance with this Agreement.

Section 2.02 Acquisition of the Property by Developer
a. The Developer shall acquire a long-term airspace lease to the Airspace Parcel located at the Property and fee simple merchantable title to the Improvements pertaining to the Property on or before the time required in the Schedule of Performance, and shall pay therefor a lease rental and purchase price not to exceed the amounts set forth for acquisition of the Property in the approved final Project Budget. The Airspace Lease shall be approved in writing by the City Manager or designee prior to the Construction Financing Event for consistency with the terms and conditions of this Agreement.
b. The timely acquisition of the Property by Developer as and when required by this Agreement shall be a condition precedent to the performance by City of any of its obligations in this Agreement.

ARTICLE III. FINANCING
Section 3.01 Method of Financing
The Acquisition and Development Costs will be financed with a combination of sources of financing as provided in the Method of Financing, attached to this Agreement as Attachment No.

3. Section 3.02 City Assistance
a. City Loans. In accordance with and subject to the terms and conditions of this Agreement, including the Method of Financing, the City agrees to lend to the Developer, and the Developer agrees to borrow from the City, the LMIHAF Loan, the In Lieu Fees Loan, and the HOME Loan, as described in the Method of Financing attached hereto as Attachment No. 3. At or prior to the Construction Loan Closing, the City and Developer will execute and deliver such instruments and documents as may be necessary to evidence and secure the City Loans, consistent with the terms of this Agreement and the Method of Financing, and each in a form that is acceptable to the City Manager or designee. Developer hereby warrants and agrees that Developer will use the HOME Loan solely for the purpose of paying a portion of the construction and rehabilitation costs for the Very Low Income Home Units and the Low Income Home Units and for no other purpose.
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b. Gap Assistance. The parties acknowledge that the City Loans are intended to be “gap” financing, not to exceed the amount needed to bridge the gap between the total Acquisition and Development Costs (as further described in the Method of Financing) and the maximum loans obtainable by Developer plus an agreed amount of Developer’s Equity, but in no event greater than the loan amounts set forth in this Agreement and the approved final Project Budget. The proceeds of the City Loans will be used exclusively to pay Acquisition and Development Costs identified in the Project Budget (which is attached to this Agreement as Attachment No. 5 and incorporated herein by this reference). The City Loans are subject to the terms and provisions of the City Loan Documents, including but not limited to the LMIHAF Note, the In Lieu Fees Note, and the HOME Note.
c. Senior Loan and Tax Credits. City agrees that the lien of the City Deed of Trust will be subordinate to the lien of the Construction Loan Deed of Trust and, during the Permanent Period, the HCD NPLH Loan and the OCHCD Loans Deeds of Trust. City agrees to make such modifications to this Agreement, and the City Manager will execute such estoppel certificates, as may reasonably be requested by the Construction Lender and the Investor Limited Partner, provided that such modifications or certificates are consistent with the terms of this Agreement and do not materially adversely affect the receipt of any material benefit by City hereunder. The City Manager will execute such subordination agreements regarding the City Loans, but not the Agreement Containing Covenants, Notice of Affordability Restrictions, or the HOME Regulatory Agreement, as may reasonably be requested by the Construction Lender and Developer, provided that such subordination agreements will provide the City with all rights under California Civil Code Section 2924b and 2924c and Health and Safety Code Section 33334.14(a)(4).

Section 3.03 Evidence of Financing
a. Not later than fifteen (15) days prior to the scheduled Construction Financing Event Date, Developer will submit to the City draft documents containing evidence satisfactory to the City that Developer has obtained the financing necessary for the development of the Property in accordance with this Agreement. Developer shall submit final documents containing such evidence prior to the scheduled Construction Financing Event Date. Such evidence of financing will include the following:

1. A copy of all loan documents relating to the Construction Loan, including a final project budget approved by the Construction Lender, certified by the Developer to be a true and correct copy or copies thereof. The Construction Loan Documents shall not contain conditions which the City Manager finds unduly prohibits the disbursement of Construction Loan proceeds prior to substantial disbursement of the City Loans (other than retainage), and Developer shall deliver to the City Manager documentation acceptable to the City Manager (or its designee) evidencing the satisfaction or waiver by the Construction Lender as of the Construction Financing Event of all conditions precedent to the disbursement of Construction Loan proceeds after the initial Construction Financing Event;
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2. Documentation acceptable to the City Manager or designee of sources of capital sufficient to demonstrate that the Developer has adequate equity funds committed to provide the amount of Developer Equity required by the Method of Financing;

3. A copy of the Permanent Financing commitment or commitments; and

4. A copy of the contract between the Developer and the general contractor and contracts with major subcontractors for the construction and rehabilitation of the Improvements, certified by the Developer to be a true and correct copy thereof. b. The City will approve or disapprove such evidence of financing within the time established in the Schedule of Performance. Such approval will not be unreasonably withheld or delayed. If the City will disapprove any such evidence of financing, the City will do so by written notice to the Developer stating the reason(s) for such disapproval.

ARTICLE IV. DEVELOPMENT OF THE PROPERTY
Section 4.01 Land Use Approvals
a. It is the responsibility of the Developer, without cost to City, to ensure that zoning of the Property and all applicable City land use requirements will be such as to permit development of the Property and construction and rehabilitation of the Improvements and the use, operation and maintenance of such Improvements in accordance with the provisions of this Agreement. b. The following will be conditions of the Construction Financing Event: (A) Developer will submit and City Manager or designee will approve one hundred percent (100%) complete construction drawings; and (B) Developer will obtain all entitlements, approvals, variances and permits necessary for the construction and rehabilitation of the Improvements. c. The City makes no warranties of any kind as to the entitlements and disclaims all liability arising from use thereof by Developer or any third party. Developer and its architect, engineer, and general contractor, are responsible to obtain all building permits and to ensure that all work performed in the development of the Project is in accordance with of all applicable federal, state, and local building codes as well as applicable construction standards, fire department standards, utility company standards and best practices. Developer hereby waives, to the fullest extent permitted by law, any right it may have to hold the City liable, or recover from the City, or any of their officers, agents, or employees, for any claims or damages which shall or might occur in connection with Developer’s use of the entitlements. d. Nothing contained herein will be deemed to entitle Developer to any City of Orange permit or other City approval necessary for the development of the Property, or waive any applicable City requirements relating thereto. This Agreement does not (a) grant any land use entitlement to Developer, (b) supersede, nullify or amend any condition which may be imposed by the City of Orange in connection with approval of the development described herein, (c) guarantee to Developer or any other party any profits from the development of the Property, or (d) amend 268
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any City laws, codes, rules or regulations. This is not a Development Agreement under Government Code Section 65864.

Section 4.02 Hazardous Materials
Prior to the Construction Financing Event Date, Developer will deliver to the City a true and complete copy of any environmental assessments Developer has made of the Property and the existing improvements. Developer agrees to perform, or cause to be performed, the clean-up of any Hazardous Substances on, in, under or within the Property, without cost or expense to the City.

Developer will defend, indemnify and hold harmless the City and its officers, agents, employees, contractors and attorneys from any claims, liability, injury, damages, costs and expenses (including, without limiting the generality of the foregoing, the cost of any required cleanup of hazardous substances, and the cost of reasonable attorneys’ fees) which may be sustained as the result of Hazardous Materials relating to the Property. As a condition precedent to the making of any of the City Loans, Developer will execute and deliver to the City the Environmental Indemnity (Attachment No. 15).

Section 4.03 Plans; Construction Contract
The Property will be developed in accordance with Plans approved by the City for the development of the Project by Developer pursuant to this Agreement and permits issued by the City. It is anticipated that Developer will contract for performance of specific activities, including but not limited to activities such as relocation services (if necessary), site inspections, and management of the Units. Such contracts will not in any way diminish or waive Developer’s obligations under this Agreement. The identity and qualifications of the general contractor must be approved by the City. Developer must also submit to the City for approval copies of the proposed contract with the general contractor and copies of any proposed subcontracts for mechanical, electrical, plumbing, framing and other trades requested in writing by the City, which approval will not be unreasonably withheld or delayed.

Section 4.04 Construction Drawings and Related Documents a. Developer will prepare and submit construction drawings and related documents for the development of the Property to the City for review (including, but not limited to, architectural review) and written approval at the times established in the Schedule of Performance.

The construction drawings and related documents shall include but not be limited to, preliminary and final drawings, plans and specifications. Final drawings, plans, and specifications are hereby defined as those in sufficient detail to obtain a building permit. Any items so submitted and approved in writing by the City will not be subject to subsequent disapproval. City approval will not be unreasonably withheld, conditioned or delayed.
b. In the event of the disapproval by the City of any plans submitted by Developer, City will promptly communicate in writing to Developer all reasons for such disapproval and all requirements for subsequent approval of revised plans.
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c. During the preparation of all drawings and plans, the City staff and Developer will hold regular progress meetings to coordinate the preparation of, submission to, and review of construction plans and related documents by the City. The City staff and Developer will communicate and consult informally as frequently as is necessary to ensure that the formal submittal of any documents to the City can receive appropriate consideration. d. If any revisions or corrections of plans approved by the City will be required by a governmental official, authority, department or bureau having jurisdiction over the development of the Property, Developer and the City will cooperate in efforts to obtain waiver of such requirements or to develop a mutually acceptable alternative.

Section 4.05 City Approval of Plans, Drawings and Related Documents As provided in Section 4.04, the City will have the right of reasonable review (including, but not limited to, architectural review) and approval of all plans, drawings and related documents for the development of the Property, including any proposed changes therein. The City will approve or disapprove such plans, drawings, and related documents referred to in this Agreement (and any proposed changes therein), in writing, within the times established in the Schedule of Performance. Any disapproval will state, in writing, the reasons for disapproval. Developer, upon receipt of the City’s disapproval will revise such portions of the plans, drawings or related documents in a manner that satisfies the reasons for disapproval and resubmit such revised portions to the City as soon as possible after receipt of the notice of disapproval. The City will approve or disapprove such revised portions in the same manner and within the same times as provided in this Section 4.05 for approval or disapproval of plans, drawings, and related documents initially submitted to the City.

Section 4.06 Cost of Construction
a. The cost of acquiring the Property and developing, rehabilitating and constructing the Improvements thereon will be the responsibility of the Developer, as provided in the Method of Financing. The Acquisition and Development Costs are set forth in the Project Budget (Attachment No. 5), which will be subject to change from time-to-time as provided in the Method of Financing. Developer will establish procurement procedures to ensure that materials and services are obtained in a cost-effective manner.
b. Developer has proposed, and the City has approved, the Project Budget appended to this Agreement as Attachment No. 5. Developer acknowledges that the City is relying on Developer’s experience and expertise in establishing the Acquisition and Development Costs for the Project and Developer represents and warrants that the Project Budget is based on Developer’s best, good faith estimate of the costs to be incurred.

Section 4.07 Schedule of Performance
a. Developer and City will perform all acts respectively required of such party in this Agreement within the times provided in the Schedule of Performance. The Schedule of 270
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Performance is subject to revision from time to time as mutually agreed upon in writing by Developer and the City Manager, and such revision approval shall not be unreasonably withheld, conditioned or delayed.
b. After the Construction Financing Event, Developer will promptly begin and thereafter diligently prosecute to completion the rehabilitation and construction of the Improvements as required by this Agreement. Developer will begin and complete all construction and development within the times specified in the Schedule of Performance, with such reasonable extensions of said times as may be granted in writing by the City, including Force Majeure Delays.

The Schedule of Performance is subject to revision from time to time as mutually agreed upon in writing by Developer and City.
c. During periods of construction, Developer will submit to the City a written report of the progress of the construction when and as requested by the City. The report will be in such form and detail as may be reasonably required by the City and will include a reasonable number of construction photographs (if requested) taken since the last report by Developer. Developer will meet with the City as requested during construction to discuss the resolution of any concerns the City might have. Representatives of the City will have the right to participate in weekly construction meetings and will have the right to approve proposed finishes, colors, fixtures, and like matters.

Section 4.08 Local, State and Federal Laws
a. Developer will carry out development, construction (as defined by applicable law) and operation of the Improvements on the Property, including, without limitation, any and all public works (as defined by applicable law), in conformity with all applicable local, state and federal laws, including, without limitation, all applicable federal and state labor laws (including, without limitation, the requirement to pay state or federal prevailing wages, if applicable).

Developer expressly covenants and warrants that, as required for disbursement of the HOME Loan, it will comply with all applicable laws, ordinances, codes, rules and regulations of the federal government, and all amendments thereto, including, but not limited to: Title 8 of the Civil Rights Act of 1968 PL.90-284; Executive Order 11063 on Equal Opportunity and Housing; Section 3 of the Housing and Urban Development Act of 1968; the Housing and Community Development Act of 1974, as well as all requirements set forth in the HOME Regulations. Developer agrees to comply with all applicable standards, orders, or requirements issued under section 306 of the Clean Air Act (42 U.S.C. 1857(h)), section 508 of the Clean Water Act (33 U.S.C. 1368), Executive Order 11738, and Environmental Protection Agency regulations (40 CFR part 15). Developer further warrants and agrees to include or cause to be included the criteria and requirements of this paragraph in every non-exempt contract in excess of $100,000. b. Developer hereby expressly acknowledges and agrees that the City of Orange has not ever previously affirmatively represented to the Developer or its contractor(s) for the Improvements in writing or otherwise, in a call for bids or otherwise, that the work to be covered by the bid or contract is not a “public work,” as defined in Section 1720 of the Labor Code. 271
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Developer hereby agrees that Developer will have the obligation to provide any and all disclosures or identifications required by Labor Code Section 1781, as the same may be enacted, adopted or amended from time to time, or any other similar law. Developer will indemnify, protect, defend and hold harmless the City, and its officers, employees, contractors and agents, with counsel reasonably acceptable to City, from and against any and all loss, liability, damage, claim, cost, expense, and/or “increased costs” (including reasonable attorneys’ fees, court and litigation costs, and fees of expert witnesses) (collectively, the “Claims”) which, in connection with the development, construction (as defined by applicable law) and/or operation of the Improvements, including, without limitation, any and all public works (as defined by applicable law), results or arises in any way from any of the following: (1) the noncompliance by Developer of any applicable local, state and/or federal law, including, without limitation, any applicable federal and/or state labor laws (including, without limitation, the requirement to pay state prevailing wages); (2) the implementation of Section 1781 of the Labor Code, as the same may be enacted, adopted or amended from time to time, or any other similar law; and/or (3) failure by Developer to provide any required disclosure or identification as required by Labor Code Section 1781, as the same may be enacted, adopted or amended from time to time, or any other similar law. c. It is agreed by the parties that, in connection with the development, construction (as defined by applicable law) and operation of the Improvements, including, without limitation, any and all public works (as defined by applicable law), Developer will bear all risks of payment or non-payment of state prevailing wages and/or Labor Code Section 1781, as the same may be enacted, adopted or amended from time to time, and/or any other similar law. “Increased costs” as used in this Section 4.08 will have the meaning ascribed to it in Labor Code Section 1781, as the same may be enacted, adopted or amended from time to time. d. The foregoing indemnity will survive termination of this Agreement and will continue after Completion, but will exclude any Claims to the extent resulting from the gross negligence and/or willful misconduct of the City.

Section 4.09 Nondiscrimination During Construction
Developer, for itself and its successors and assigns, agrees that during the construction of the Improvements provided for in the Agreement, Developer will not discriminate on the basis of race, gender, religion, national origin, ethnicity, sexual orientation, age or disability in the solicitation, selection, hiring or treatment of any employees, contractors or consultants. Developer understands and agrees that violation of this clause will be considered a material breach of this Agreement and may result in termination, debarment or other sanctions. This language must be incorporated into all contracts between Developer and any contractor or consultant, and all contracts with any subcontractor, sub-consultant, vendor or supplier.

Section 4.10 Copeland Anti-Kickback Act
Developer will comply with the provisions of the Copeland Anti-Kick-Back Act (18 U.S.C. 874) as supplemented in the Department of Labor regulations (29 CFR Part 3), as amended.

Developer warrants and agrees to include or cause to be included this requirement in every 272
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nonexempt subcontract. Developer also agrees to take such action as the federal, state or local government may direct to enforce aforesaid provisions.

Section 4.11 Contract Work Hours and Safety Standards Act Developer will comply with the provisions of sections 103 and 107 of the Contract Work Hours and Safety Standard Act (40 U.S.C. 327-330) as supplemented by the Department of Labor regulations (29 CFR, Part 5), as amended. Developer warrants and agrees to include or cause to be included this requirement in every nonexempt contract. Developer also agrees to take such action as the federal, state or local government may direct to enforce aforesaid provisions.

Section 4.12 Indemnification and Insurance
a. Developer agrees to and will, to the fullest extent permitted by law, defend, indemnify and hold the City of Orange and its officers, employees, contractors and agents harmless from and against all claims, liability, loss, damage, costs or expenses (including reasonable attorneys’ fees and court costs) arising from or as a result of, in whole or in part, any of the following: (1) any act or omission of Developer or its architect, engineer, contractors, suppliers, or vendors, of any contracting tier, or anyone directly or indirectly employed by any of them, or anyone for whose acts Developer may be liable, in connection with the performance or nonperformance of this Agreement, including but not limited to the development, rehabilitation, marketing or use of the Property in any way, and any plans or designs for improvements prepared by or on behalf of Developer, including without limitation any errors or omissions with respect to such plans or designs; (2) the breach of any obligations of Developer hereunder; and (3) the use of any products, material or equipment furnished by Developer or its contractors, suppliers, or vendors, of any contracting tier. Such obligation to indemnify will not be construed to negate, abridge, or otherwise reduce other rights or obligations of indemnity which would otherwise exist as to a party or person described in this Section. The foregoing indemnification will apply to the extent of the violation of a legal duty, including but not limited to active or passive negligence, strict liability, breach of contract, or intentional or willful misconduct, by Developer or its architect, contractors, suppliers, or vendors, of any contracting tier, or anyone directly or indirectly employed by any of them, or anyone for whose acts Developer may be liable. Indemnitees will be entitled to recovery of attorney’s fees incurred as a result of Developer’s failure to provide the defense and indemnity required by this Section. This Section will survive the expiration or termination of this Agreement. b. Prior to the Construction Financing Event Date (except as provided in the next sentence), Developer will furnish or cause to be furnished to the City evidence of the following policies of insurance, naming Developer as insured and the City as certificate holder and, except as to the insurance described in paragraph (v), below, the City as additional insureds. The insurance requirements set forth in this subsection b. are subject to change prior to the Construction Financing Event Date, as needed to satisfy City’s then-applicable requirements. Evidence of insurance must include additional insured endorsements naming the City as additional insureds and including a primary insurance and waiver of contribution clause, a separation of insureds clause and a cancellation notice clause, in the form approved by the City. The insurance described in paragraph (ii) will be obtained prior to the initial rent-up of the apartments. It is the mutual 273
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intent of the parties that the levels of insurance coverage described herein will be and remain comparable to the level of insurance coverage that is customary with comparable operations in Orange County. At any time during the term of the City Loans, and from time to time, either party may provide notice to the other party that the level of insurance being maintained by Developer is no longer comparable to the level of insurance coverage that is customary with comparable operations in Orange County, and request that the minimum limit hereinabove designated will be changed (either increased or decreased) accordingly. The party receiving such request will not unreasonably withhold its consent to such change. Developer agrees that provisions of this paragraph as to maintenance of insurance will not be construed as limiting in any way the extent to which Developer may be held responsible for the indemnification of City or the payment of damages to persons or property resulting from Developer’s activities, activities of its tenants or the activities of any other person or persons for which Developer is otherwise responsible.

Developer will require its insurer to waive its subrogation rights against the City and will provide endorsements evidencing same.

1. Fire Policies: A policy or policies of insurance against loss or damage to the Property or the Improvements and all property of an insurable nature located upon the Property, resulting from fire, lightning, vandalism, malicious mischief, riot and civil commotion, and such other perils ordinarily included in extended coverage fire insurance policies. Such insurance will be maintained in an amount not less than one hundred percent (100%) of the full insurable value of the Improvements, as defined herein in paragraph d.

2. Rental Income Insurance: Use and occupancy or business interruption or rental income insurance against the perils of fire, lightning, vandalism, malicious mischief, riot and civil commotion, and such other perils ordinarily included in extended coverage fire insurance policies, in an amount that is acceptable to Developer and the City, with a minimum loss period of 24-months.

3. General Liability Insurance: General liability insurance of at least $5,000,000 per occurrence for bodily injury, personal injury and property damage. If Commercial General Liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit.

4. Boiler and Machinery Insurance: Boiler and machinery insurance covering the HVAC system for one hundred percent (100%) of the full insurable value of the HVAC system, issued on an all risk basis, with a deductible no greater than $100,000.

5. Workers’ Compensation Insurance: Developer will maintain or cause to be maintained workers’ compensation insurance issued by a responsible carrier authorized under the laws of the State of California to insure employers against liability for compensation under the workers’ compensation laws now in force in California, or any laws hereafter enacted as an amendment or supplement thereto or in lieu thereof. Such workers’ compensation insurance will cover all persons employed by Developer in connection with the Property and will cover liability 274
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within statutory limits for compensation under any such act aforesaid, based upon death or bodily injury claims made by, for or on behalf of any person incurring or suffering injury or death in connection with the Property or the operation thereof by Developer. Notwithstanding the forego- ing, Developer may, in compliance with the laws of the State of California and in lieu of maintaining such insurance, self-insure for workers’ compensation in which event Developer will deliver to City evidence that such self-insurance has been approved by the appropriate State authorities. If Developer is required to maintain Workers’ Compensation Insurance under this paragraph, Developer will furnish the City with a certificate of waiver of subrogation under the terms of the Workers’ Compensation Insurance. Developer will require its general contractor to waive subrogation and will require that its subcontractors waive subrogation to the extent that such a waiver is commercially available.
c. All policies hereunder will not be subject to cancellation, reduction in coverage, or non-renewal except after notice in writing will have been sent by registered mail addressed to the City and the City not less than 30 days in advance of the effective date, except for cancellation for nonpayment of premium, in which event notice will be given not less than 10 days in advance of the effective date. All policies will name the City, Developer and/or any general contractor as insureds, additional insureds, and/or loss payable parties as their interests may appear. d. The term “full insurable value” as used in this Section means the actual replacement cost (excluding the cost of excavation, foundation and footings below the lowest floor and without deduction for depreciation) of the Improvements on the Property immediately before such casualty or other loss, including the cost of construction, architectural and engineering fees, and inspection and supervision. To ascertain the amount of coverage required, Developer will cause the full insurable value to be determined from time to time by appraisal by the insurer, by the insurer’s automatic inflationary measure if acceptable to the Developer and the City, by agreement between Developer and City or by an appraiser mutually acceptable to City and Developer, not less often than once every three years.
e. All insurance provided under this Section will be for the benefit of Developer and City. Developer agrees to timely pay all premiums for such insurance and, at its sole cost and expense, to comply and secure compliance with all insurance requirements necessary for the maintenance of such insurance. Developer agrees to submit policies of all insurance required by this Section, or certificates and endorsements evidencing the existence thereof, to City within 30 days prior to the Construction Financing Event Date, indicating full coverage of the contractual liability imposed hereby. Within thirty (30) days, if practicable, but in any event prior to expiration of any such policy, copies of renewal policies, or certificates evidencing the existence thereof, will be submitted to City. All insurance herein provided for under this Section will be effected under policies issued by insurers of recognized responsibility, licensed or permitted to do business in the State of California reasonably approved by City.
f. Developer must cause all contractors and subcontractors performing work relating to the Project to maintain, at a minimum, the liability insurance and workers compensation insurance described in this Section. Developer must also cause its architects and engineers to 275
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maintain Architects and Engineers Professional Liability (Errors and Omissions) insurance on a “claims made basis” in an amount of not less $1,000,000. When coverage is provided on a “claims made basis”, Developer must cause all contractors and subcontractors to continue to renew the insurance for a period of ten (10) years after the end of the Construction Period. Such insurance must have the same coverage and limits as the policy that was in effect during the Construction Period, and cover Developer for all claims made by the City arising out of any acts or omissions of Developer, or its officers, employees or agents during the Construction Period. g. If Developer fails or refuses to procure or maintain insurance as required by this Agreement, City will have the right, at City’s election, and upon ten (10) days prior notice to Developer, to procure and maintain such insurance. The premiums paid by City will be treated as a loan, due from Developer, to be paid on the first day of the month following the date on which the premiums were paid. City will give prompt notice of the payment of such premiums, stating the amounts paid and the name of the insured(s).

Section 4.13 Disclaimer of City Responsibility
Except as provided in this Agreement, the City neither undertakes nor assumes nor will have any responsibility or duty to Developer or to any third party to review, inspect, supervise, pass judgment upon or inform Developer or any third party of any matter in connection with the Property, whether with respect to the quality, adequacy or suitability of the plans, any labor, service, equipment or material furnished to the Project, any person furnishing the same or otherwise. Developer and all third parties will rely upon its or their own judgment regarding such matters, and any review, inspection, supervision, exercise of judgment or information supplied to Developer or to any third party by the City in connection with such matter is for the public purpose of providing affordable housing, and neither Developer (except for the purposes set forth in this Agreement) nor any third party is entitled to rely thereon. Neither may Developer or any third party assert such review, inspection, supervision, exercise of judgment or information supplied to Developer or to any third party as a defense to the indemnification obligation set forth in Section

4.12.a of this Agreement.

Section 4.14 Permits
Before commencement of construction or development of any buildings, structures or other work of improvement upon any portion of the Property, Developer will, at its own expense, secure or cause to be secured, any and all permits which may be required by the City or any other governmental authority affected by such construction, development or work.

Section 4.15 Rights of Access
Commencing upon the Construction Financing Event Date, representatives of the City will have the reasonable right of access to the Property, upon two (2) business days’ written notice to Developer (except in the case of an emergency, in which case City will provide such notice, if any, as may be practical under the circumstances), without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including, but not limited to, 276
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the inspection of the work being performed in constructing the improvements. Such representatives of the City will be those who are so identified in writing by the City Manager.

Section 4.16 Taxes, Assessments, Encumbrances and Liens Commencing upon the Construction Financing Event Date, Developer will pay prior to delinquency all real estate taxes and assessments assessed and levied on or against the Property.

Prior to Completion, Developer will not place, or allow to be placed, on title to the Property or any portion thereof, any mortgage, trust deed, encumbrance or lien not authorized by this Agreement.

In addition, Developer will remove, or will have removed, any levy or attachment made on title to the Property (or any portion thereof), or will assure the satisfaction thereof within a reasonable time but in any event prior to a sale thereunder. Nothing herein contained will be deemed to prohibit the Developer from contesting the validity or amount of any tax assessment, encumbrance or lien, or to limit the remedies available to the Developer in respect thereto.

Section 4.17 Rights to Plans
a. Subject to the rights of the beneficiary of the Construction Loan Deed of Trust, all work product prepared pursuant to this Agreement, including (but not limited to), all Plans, construction documents, soils tests and similar reports, permits and other entitlements are hereby assigned to the City as security for Developer’s obligations hereunder. In the event that this Agreement is terminated by the City, Developer will, within ten (10) business days of such termination, transmit all such work product to the City. b. To effectuate the assignment described in paragraph a., concurrently with executing a contract with the project architect, Developer will execute and deliver to the City an Assignment of Agreements (the “Assignment”), substantially in the form attached to this Agreement as Attachment No. 14 in a form that is acceptable to the City Manager, granting to the City all of Developer’s rights to: (1) the Plans prepared pursuant to this Agreement; (2) the contract between Developer and its architect; (3) all permits relating to the Project; (4) studies and reports concerning the Property; and similar rights and property interests.

Section 4.18 Release of Construction Covenants
a. Promptly after Completion of the Improvements, as generally and specifically required by this Agreement, the City will furnish Developer with a Release of Construction Covenants upon written request therefor by Developer. The City will not unreasonably withhold such Release of Construction Covenants and such Release of Construction Covenants will be issued so long as Developer has constructed and developed the Property in accordance with this Agreement and substantially in accordance with the Plans approved by the City pursuant hereto.

Such Release of Construction Covenants will be, and will so state, conclusive determination of satisfactory completion of all of the construction required by this Agreement. 277
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b. The Release of Construction Covenants will be in such form as to permit it to be recorded in the official records of Orange County. No Release of Construction Covenants will be recorded for less than the completed Improvements and development of the entire Property. c. If the City refuses or fails to furnish a Release of Construction Covenants for the Property after written request from Developer, the City will, within thirty (30) days of the written request, provide Developer with a written statement of the reasons the City refused or failed to furnish a Release of Construction Covenants. The statement will also contain the City’s opinion of the action Developer must take to obtain a Release of Construction Covenants. If the reason for such refusal is confined to the immediate availability of specific items or materials for landscaping, and/or minor items, the City will issue its Release of Construction Covenants upon the posting of a bond by Developer with the City in an amount representing a fair value of the work not yet completed. If the City will have failed to provide such written statement within said 30-day period, Developer will be deemed to have received the Release of Construction Covenants. d. The Release of Construction Covenants will not constitute evidence of compliance with or satisfaction of any obligation of Developer to the beneficiary of the Construction Loan Deed of Trust or any other Person. The Release of Construction Covenants is not a notice of completion as referred to in Section 3093 of the California Civil Code.

ARTICLE V. USE OF THE PROPERTY
Section 5.01 Use As Affordable Housing
a. Developer covenants and agrees (for itself, its successors, its assigns, and every successor in interest to the Property or any part thereof) that Developer, its successors and assigns will use the Property exclusively to provide affordable housing for Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households (except for one staff/manager’s unit), in conformance with the Agreement Containing Covenants and the HOME Regulatory Agreement including common areas associated therewith. No change in the use of the Property will be permitted without the prior written approval of the City, exercised in the sole discretion of the City. b. The Very Low Income HOME Units and the Low Income HOME Units must be operated in accordance with the following requirements:

1. The Very Low Income HOME Units and the Low Income HOME Units will be designated as floating HOME units. Prior to lease-up of the Project, Developer must identify the street address and unit number of the units that will be operated as Very Low Income HOME Units and Low Income HOME Units. Proposed changes to such units must be approved in advance by the City. Each substituted unit must be comparable in terms of size, features, and number of bedrooms to the originally designated HOME unit.

2. The maximum monthly rent (including a reasonable utility allowance) may not exceed HOME Rents as set forth in Section 1.02 of this Agreement. The HOME rent limits published by HUD will include average occupancy per unit and adjusted income assumptions. 278
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3. In accordance with the formula set forth in 24 CFR 92.252(e) and as required by 24 CFR 92.504 (c)(3)(ix), rents will remain affordable to Very Low Income HOME Tenants and Low Income HOME Tenants pursuant to this Agreement for not less than fifteen (15) years for rehabilitated HOME units and not less than twenty (20) years for newly constructed HOME units, following the date of issuance of a final Certificate of Occupancy by the City of Orange.

4. Failure to comply with the affordability requirements of this Agreement or the HOME Regulatory Agreement, subject to the notice and cure periods in Section 6.01, is an event of default under the terms of the HOME Loan. Pursuant to the HOME Note evidencing the HOME Loan, the HOME Loan will be due and payable, subject to the notice and cure periods in Section 6.01, if the housing does not meet the affordability requirements of this Agreement and the HOME Regulatory Agreement.

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

6. The City has provided Developer with current HUD income and rent limits to Developer, and will provide Developer with updated HUD income and rent limits as they become available.

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

8. Income determination and rental rate adjustments will occur upon annual lease renewal. Any increase in rents for HOME-assisted units is subject to the provisions of existing leases, including the provision that rents may not be adjusted until leases are renewed.

Developer must provide tenants with not less than thirty (30) days prior written notice before implementing any increase in rents.

9. Developer agrees that prior to the initial lease-up of the Project, Developer will consult with and obtain the approval of the City in developing an affirmative marketing plan for renting the Units. The affirmative marketing plan must comply with the requirements of 24 CFR 92.351.

10. No officer, employee, agent, official, consultant, or immediate family member of Developer (or immediate family member of an officer, employee, agent, official, or consultant of Developer) may occupy a HOME-assisted unit. 279
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c. The City and its successors and assigns will have the right to monitor and enforce the covenants contained in this Section 5.01. Developer covenants that it will comply with the monitoring program established by the City to enforce said covenants. In complying with such monitoring program, Developer or its agent will prepare and submit to the City an annual occupancy report, financial information and income verification documents for each tenant and all supporting documentation, on forms provided by the City, setting forth the required information for the preceding year. On an annual basis, Developer or its agent will additionally submit to the City evidence of each tenant’s continuing eligibility to occupy the unit. The City will review such reports for certification of continuing affordability of Units and eligibility of tenants.

Section 5.02 Management Plan; Annual Project Budget; Quarterly Report a. Within the time set forth therefor in the Schedule of Performance, Developer will submit to the City Manager a Management Plan reasonably acceptable to the City Manager, describing the proposed plan for managing and operating the Property, including policies and procedures to assure accessibility to persons with disabilities. The City will provide Developer a draft Management Plan which Developer shall use to prepare the final Management Plan submitted to the City. Developer will manage and operate the Property in accordance with the approved Management Plan, including such amendments as may be approved in writing from time to time by the Developer and the City Manager or designee, for the entire Restricted Period. b. In addition, the Developer will submit on or before the first day of each fiscal year of the Restricted Period an estimated annual budget for management of the Property (the “Annual Project Budget ”) in accordance with the Management Plan. The Annual Project Budget will include all necessary operating expenses, current maintenance charges, expenses of reasonable upkeep and repairs, taxes and special assessment levies, prorated amount required for insurance and all other expenses incident to the operation of the Project; and will show the expected revenues to pay such expenses, including annual debt service requirements and reserve fund deposits and balances. The Annual Project Budget, including any amendments proposed by the Developer, will be subject to the approval of the City Manager, which approval will not be unreasonably withheld or delayed.
c. Beginning on the date of first occupancy, for each fiscal year of the Restricted Period, Developer will also submit on a quarterly basis a quarterly report for the management of the Property (the “Quarterly Report”) in a form that is reasonably acceptable to the City Manager.

The Quarterly Report will include a profit and loss statement, budget to date figures, and occupancy report. Developer’s failure to timely submit the Quarterly Reports, after the City has provided written notice to Developer and at least thirty (30) days to cure such failure, will cause the imposition of a monetary penalty of $500 to be paid to the City. The City Manager, in his or her sole discretion may waive the requirement of the Quarterly Report for one or more quarterly reporting periods. However, such waiver will not operate to waive any subsequent requirement of the Quarterly Report for the Restricted Period upon written notice to Developer by the City Manager.
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d. The Agreement Containing Covenants and the HOME Regulatory Agreement will contain appropriate provisions implementing this Section 5.02.

Section 5.03 Property Maintenance
a. Within the time set forth therefor in the Schedule of Performance, the Developer will prepare and submit to the City Manager or designee for review and approval a program (the “Maintenance Program ”) for the exterior and interior maintenance of the Property and the Improvements. The City will provide Developer a draft Maintenance Program which Developer shall use to prepare the final Maintenance Program submitted to the City. b. The Maintenance Program will describe in reasonable detail the standards to be followed in maintaining the interior and exterior of the Improvements, including a schedule indicating the proposed frequency of each element of maintenance, and will include, at a minimum, the following: periodic cleaning of the interior and exterior of the Improvements, including windows; removing graffiti; removing debris and waste materials and otherwise maintaining indoor and outdoor areas of the Property; maintaining any lawns, plants, shrubs and trees or other landscaping planted on the Property; performing inspections of all exterior features to determine whether repairs are required; conducting periodic protective treatments such as rust removal and caulking; conducting repairs to facades, roof, doors, windows and other exterior features; maintaining fencing and other security devices and systems; periodic repainting of the exterior; periodic repainting of the interior units and common areas; periodic replacing of the interior unit carpets; checking building systems, including, but not limited to the heating and cooling systems, smoke alarms and water heaters; checking interior unit appliances; and monitoring interior unit bathrooms for mold/mildew. The Maintenance Program, including any amendments proposed by the Developer, will be subject to the reasonable approval of the City Manager. c. At all times during the Restricted Period, the Developer will maintain the Property and the Improvements in accordance with the approved Maintenance Program. To implement this requirement, Developer agrees to budget sufficient funds to pay for all reasonably anticipated costs (as indicated in the Annual Project Budget). In the event the Developer fails to maintain the Property and the Improvements in accordance with the approved Maintenance Program, and does not cure such failure within thirty (30) days following notice from the City, with such additional time as may be reasonably necessary to cure such default provided that Developer has commenced to cure within such thirty (30) day period and is diligently prosecuting the cure to completion, the City will have the right, but not the obligation, to enter the Property, correct any violation, and hold the Developer responsible for the cost thereof, and such cost, until paid, will constitute a lien on the Property, which lien shall at all times be subject and subordinate to the Construction Loan Deed of Trust and any other lien granted to Construction Lender in connection with the Construction Loan. Prior to undertaking any work to correct any such maintenance deficiency, the City will provide written notice that the Developer must correct the deficiency within a reasonable time. The Developer will have a reasonable time in which to comply following such notice from the City.
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d. The Agreement Containing Covenants and the HOME Regulatory Agreement will contain appropriate provisions implementing this Section 5.03.

Section 5.04 Obligation to Refrain from Discrimination
a. Developer covenants and agrees for itself, its successors and its assigns in interest to the Property or any part thereof, that there will be no discrimination against or segregation of any person, or group of persons, on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, nor will Developer itself or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees of the Property.
b. All deeds, leases or contracts will contain or be subject to substantially the following nondiscrimination or nonsegregation clauses:

1. In deeds: “The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through them, that there will be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor will the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the premises herein conveyed.

The foregoing covenants will run with the land.”
Notwithstanding the preceding paragraph, the provisions relating to discrimination on the basis of familial status will not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code nor be construed to affect Sections 51.2, 51.3, 51.4,

51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code will also apply to the preceding paragraph.

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

That there will be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein 282
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leased nor will the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees in the premises herein leased.”
Notwithstanding the preceding paragraph, the provisions relating to discrimination on the basis of familial status will not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code nor be construed to affect Sections 51.2, 51.3, 51.4,

51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code will also apply to the preceding paragraph.

3. In contracts: There will be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the land, nor will the transferee itself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees of the land.”
Section 5.05 Equal Employment Opportunity
During the term of this Agreement, Developer agrees as follows:
a. Developer will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin(s). Developer will take affirmative action to ensure the applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex or national origin(s). Such action shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer, recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. Developer agrees to post in conspicuous places, available to employees and applicants for employment, notices setting forth the provisions of this nondiscrimination clause.
b. Developer will, in all solicitations or advertisements for employees placed by or on behalf of Developer, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin. c. Developer will send to each labor union or representative of workers with which he has a collective bargaining agreement or other contract or understanding, a notice advising the labor union or worker’s representative of Developer’s commitments under Section 202 of Executive Order No. 11246 of September 24, 1965, and shall post copies of the notice in conspicuous places available to employees and applicants for employment. 283
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d. Developer will comply with all provisions of Executive Order 11246 of September 24, 1965, and of the rules, regulations, and relevant orders of the Secretary of Labor. e. Developer will furnish all information and reports required by Executive Order 11246 of September 24, 1965, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to its books, records, and accounts by the City and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and order.
f. If Developer is found to be in noncompliance with the nondiscrimination clauses of this Agreement or with any of such rules, regulations or orders, this Agreement may be canceled, terminated or suspended in whole or in part and Developer may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order 11246 of September 24, 1965, and such other sanctions may be imposed and remedies invoked as provided in Executive Order 11246 of September 24, 1965 or by rule, regulations, or order of the Secretary of Labor or as otherwise provided by law.
g. Developer will include the provisions of paragraphs (a) through (g) of this Section

5.05 in every contract or purchase order related to the Project unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to section 204 of Executive Order 11246 of September 24, 1965, so that such provisions will be binding upon each contractor or vendor providing services related to the Project. Developer will take such action with respect to any contract or purchase order as the City may direct as a means of enforcing such provisions, including sanctions for noncompliance.

Section 5.06 Labor, Training, and Business Opportunity
Developer agrees to comply with the federal regulations governing training, employment and business opportunities, including but not limited to Section 3 of the Housing and Urban Development Act of 1968, to the extent such regulations apply to Developer. Compliance with the provisions of Section 3, the regulations set forth in 24 Code of Federal Regulations and all applicable rules and orders of the Department of Housing and Urban Development issued thereunder prior to the execution of this Agreement will be a condition precedent to federal financial assistance being provided to the Project as well as a continuing condition, binding upon the applicant or recipient for such assistance, its successors, and assigns. Failure to fulfill these requirements will subject Developer, its contractors and subcontractors, its successors, and assigns to those sanctions specified by 24 Code of Federal Regulations as well as with any and all applicable amendments thereto.

Section 5.07 Effect and Duration of Covenants
The covenants established in this Agreement will run with the land, without regard to technical classification and designation, and will be for the benefit and in favor of City and its successors and assigns. The covenants described in this Part 5 will commence upon the Construction Financing Event Date and will be set forth in the Agreement Containing Covenants and the HOME Regulatory Agreement and will remain in effect for the respective periods specified therein.
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Section 5.08 Enforcement of Covenants
The City is deemed to be the beneficiary of the terms and provisions of this Agreement and the covenants herein, both for and in its own right and for the purposes of protecting the interests of the community and the public, for whose benefit this Agreement and the covenants running with the land have been provided. The City will have the right if the covenants contained in this Agreement are breached and such breach is not cured within the time periods set forth in Section

6.01, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings, including but not limited to an action for specific performance, to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and covenants are entitled.

Section 5.09 Monitoring
a. The parties acknowledge that, due to the City’s use of Low and Moderate Income Housing Asset Fund, this Agreement is subject to the provisions of Health and Safety Code section 33418, which provides for the City to monitor, on an ongoing basis, any housing affordable to persons and families of low or moderate income developed or otherwise made available pursuant to any provisions of applicable statute. As part of this monitoring, City will require Developer to submit an annual report to the City. The annual reports will include for each rental unit the rental rate and the income and family size of the occupants... The income information required by this section will be supplied by the tenant in a certified statement of a form provided by the City.

Developer will submit to the City on an annual basis the report required by Section 33418.

Developer will provide for the submission of such information in its lease or occupancy agreement with tenants.
b. On an annual basis, Developer will submit to the City information on rents and occupancy of the Very Low Income HOME Units and the Low Income HOME Units to demonstrate compliance with the income and affordability requirements of 24 CFR 92.252 and this Agreement. Developer must also provide the City with information regarding HOME-unit substitution and filling of vacancies sufficient to demonstrate that the Project remains in compliance with HOME rental occupancy requirements.

Section 5.10 Agreement Containing Covenants; HOME Regulatory Agreement Concurrently with the Construction Financing Event Date, Developer and City will execute and deposit with the Escrow Agent an Agreement Containing Covenants substantially in the form attached to this Agreement as Attachment No. 7, and a HOME Regulatory Agreement substantially in the form attached to this Agreement as Attachment No. 8. 285
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ARTICLE VI. DEFAULTS AND REMEDIES
Section 6.01 Defaults - General
a. Subject to the Force Majeure Delay, as provided in Section 7.04 and the cure periods provided herein, failure or delay by either party to perform any term or provision of this Agreement constitutes a default under this Agreement. The party who fails or delays must immediately commence to cure, correct or remedy such failure or delay and will complete such cure, correction or remedy with reasonable diligence.
b. The injured party will give written notice of default to the party in default, specifying the default complained of by the injured party. Failure or delay in giving such notice will not constitute a waiver of any default, nor will it change the time of default. Except as otherwise expressly provided in this Agreement, any failures or delays by either party in asserting any of its rights and remedies as to any default will not operate as a waiver of any default or of any such rights or remedies. Delays by either party in asserting any of its rights and remedies will not deprive either party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies. c. If a monetary event of default occurs, prior to exercising any remedies hereunder, the injured party will give the party in default written notice of such default. The party in default will have a period of ten (10) days after such notice is given within which to cure the default prior to exercise of remedies by the injured party.
d. If a non-monetary event of default occurs, prior to exercising any remedies hereunder, the injured party will give the party in default notice of such default. If the default is reasonably capable of being cured within thirty (30) days, the party in default will have such period to effect a cure prior to exercise of remedies by the injured party. If the default is such that it is not reasonably capable of being cured within thirty (30) days, and the party in default (i) initiates corrective action within said period, and (ii) diligently, continually, and in good faith works to effect a cure as soon as possible, then the party in default will have such additional time as is reasonably necessary to cure the default prior to exercise of any remedies by the injured party, but in no event to exceed a period of one hundred eighty (180) days after such notice is given. e. If Developer fails to take corrective action or cure the default within a reasonable time, the City will give the Senior Lender and, as provided in paragraph f., below, the Investor Limited Partner notice thereof. Subject to the terms of the Limited Partnership Agreement, the Investor Limited Partner may take such action, including removing and replacing the general partner or managing member of the Developer with a substitute general partner or member, who will effect a cure within a reasonable time thereafter in accordance with the foregoing provisions.

The City agrees to accept cures tendered by any Senior Lender or Investor Limited Partner within the cure periods provided herein. Additionally, in the event the Senior Lender or Investor Limited Partner is precluded from curing a non-monetary default due to a bankruptcy, injunction, or similar proceeding by or against Developer or the general partner of Developer, the City agrees to forbear from completing a foreclosure (judicial or nonjudicial) during the period during which the Senior 286
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Lender or Investor Limited Partner is so precluded from acting, not to exceed ninety (90) days, provided such Investor Limited Partner and Senior Lender are otherwise in compliance with the foregoing provisions. In no event will the City be precluded from exercising remedies if its rights become or are about to become materially jeopardized by any failure to cure a default or the default is not cured within one hundred eighty (180) days after the first notice of default is given. f. City will send to the Investor Limited Partner a copy of all notices of default and all other notices that City sends to Developer, at the address for the Investor Limited Partner provided in the LMIHAF Note. The City agrees to accept cure by the Investor Limited Partner on behalf of Developer of any default hereunder on the same terms as cure by Developer.

Section 6.02 Institution of Legal Actions
Subject to the notice and cure provisions of Section 6.01, in addition to any other rights or remedies (and except as otherwise provided in this Agreement), either party may institute legal action to cure, correct or remedy any default, to recover damages for any default, or to obtain any other remedy consistent with the purpose of this Agreement. Such legal actions must be instituted in the Superior Court of the County of Orange, State of California, in any other appropriate court of that county, or in the United States District Court for the Central District of California.

Section 6.03 Applicable Law
The laws of the State of California will govern the interpretation and enforcement of this Agreement, without reference to the principles relating to conflicts of laws.

Section 6.04 Acceptance of Service of Process
a. If legal action is commenced by the Developer against the City, service of process on the City will be made by personal service upon the City Manager, or in such other manner as may be provided by law.
b. If legal action is commenced by the City against the Developer, service of process on the Developer will be made by personal service upon the Developer (or upon a general partner, managing member or officer of the Developer) and will be valid whether made within or without the State of California, or in such manner as may be provided by law.

Section 6.05 Rights and Remedies are Cumulative
Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either party of one or more of such rights or remedies will 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.
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Section 6.06 Damages
If either party defaults with regard to any of the provisions of this Agreement, subject to the notice and cure provisions of Section 6.01 and the non-recourse provisions of Section 6.11, the defaulting party will be liable to the non-defaulting party for any damages caused by such default, and the non-defaulting party may, after such notice and opportunity to cure (but not before) commence an action for damages against the defaulting party with respect to such default.

Section 6.07 Specific Performance
If either party defaults with regard to any of the provisions of this Agreement, subject to the notice and cure provisions of Section 6.01, the non-defaulting party, at its option, may, after such notice and opportunity to cure (but not before) commence an action for specific performance of the terms of this Agreement pertaining to such default.

Section 6.08 Termination by Either Party
Prior to the Construction Financing Event Date, either party will have the right to terminate this Agreement in the event (i) the other party is in default of any material term or provision of this Agreement, and, following notice, fails to cure such default within the time provided in Section

6.01or (ii) the parties mutually determine that, despite using good faith commercially reasonable efforts, Developer will be unable to obtain the necessary financing for the Project.

Section 6.09 Termination by Developer
Prior to the Construction Financing Event Date, subject to the notice and cure provisions of Section 6.01, Developer will have the right to terminate this Agreement, by providing written notice to the City, in the event of a default by City pursuant to this Agreement.

Section 6.10 Termination by City
a. In accordance with 24 CFR 85.43 and subject to applicable notice and cure periods, suspension or termination of this Agreement may occur if Developer materially fails to comply with any term of the award of HOME Funds, and the award may be terminated for convenience in accordance with 24 CFR 85.44, subject to applicable notice and cure periods. b. Subject to the notice and cure provisions of Section 6.01, the City will have the right, prior to the Construction Financing Event Date, to terminate this Agreement, by providing written notice to Developer, in the event of a default by Developer or failure of any condition precedent to the occurrence of the Construction Financing Event which is in the control of Developer, including but not limited to the following:

1. Developer fails to submit to the City evidence of financing or fails to satisfy any other condition precedent to the occurrence of the Construction Financing Event as provided 288
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in the Method of Financing within the time established therefor in the Schedule of Performance; or

2. Developer (or any successor in interest) assigns or attempts to assign any of Developer’s rights in and to the Property or any portion thereof or interest therein, or this Agreement or any portion hereof, except as permitted by this Agreement; or

3. Except for a Permitted Transfer, there is substantial change in the ownership of the Developer, or with respect to the identity of the parties in control of Developer, or the degree thereof contrary to the provisions of Section 1.06.b. of this Agreement; or

4. Developer fails to submit any of the reports, plans, drawings and related documents required by this Agreement by the respective dates provided in this Agreement. c. After the Construction Financing Event, but before Completion, City will have the additional right to terminate this Agreement in the event any of the following defaults will occur:

1. Developer fails to commence construction of the Improvements as required by this Agreement and such breach is not cured within the time provided in Section 6.01 of this Agreement; or

2. Developer abandons or substantially suspends construction of the improvements and such breach is not cured within the time provided in Section 6.01 of this Agreement; or

3. Developer assigns or attempts to assign this Agreement, or any rights herein, or transfer, or suffer any involuntary transfer of the Property, or any part thereof, in violation of this Agreement, and such breach is not cured within the time provided in Section 6.01 of this Agreement; or

4. Developer otherwise materially breaches this Agreement, and such breach is not cured within the time provided in Section 6.01 of this Agreement. d. Notwithstanding the foregoing, the City will have the right to terminate this Agreement upon a final determination by state or federal court or the California Fair Political Practices Commission, subject to cure rights or appeal, of a criminal, material, and/or repeated violation of local, state, or federal campaign finance laws by Developer or a general partner of Developer or a member of such general partner or an officer or other Person exercising management or control over such member.

Section 6.11 Limited Recourse Obligations
a. Subject to the provisions and limitations of this Section 6.11, the obligation to repay the City Loans is a nonrecourse obligation of the Developer. Developer and each general partner or limited partner of Developer will not have any personal liability for repayment of the City 289
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Loans, except as provided in this Section 6.11. The sole recourse of City will be the exercise of its rights against the Property and other security for the City Loans. Provided, however, that the foregoing will not (a) constitute a waiver of an obligation evidenced by the LMIHAF Note, the In Lieu Fees Note, the HOME Note, or City Deed of Trust; (b) limit the right of the City to name Developer as a party defendant in an action or suit for judicial foreclosure and sale under the LMIHAF Note, the In Lieu Fees Note, the HOME Note or the City Deed of Trust or an action or proceeding thereunder so long as no judgment in the nature of a deficiency judgment will be asked for or taken against Developer; (c) release or impair the LMIHAF Note, the In Lieu Fees Note, the HOME Note, or the City Deed of Trust; (d) prevent or in any way hinder the City from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, any other remedy against the mortgaged Property or any other instrument securing the City Loans or as prescribed by law or in equity in case of default; (e) prevent or in any way hinder the City from exercising, or constitute a defense, an affirmative defense, a counterclaim, or other basis for relief in respect of the exercise of, its remedies in respect of deposits, insurance proceeds, condemnation awards or other monies or other collateral or letters of credit securing the City Loans; or (f) relieve Developer of its obligations under an indemnity delivered by Developer to the City. The foregoing provisions of this paragraph are limited by the provision that in the event of the occurrence of a default, Developer and its successors and assigns will have personal liability hereunder for any deficiency judgment, but only if and to the extent Developer, its principals, shareholders, partners or its successors and assigns received rentals, other revenues, or other payments or proceeds in respect of the mortgaged Property after the occurrence of such default, which rentals, other revenues, or other payments or proceeds have not been used for the payment of ordinary and reasonable operating expenses of the mortgaged Property, ordinary and reasonable capital improvements to the mortgaged Property, debt service, real estate taxes in respect of the mortgaged Property and basic management fees, but not incentive fees, payable to an entity or person unaffiliated with Developer in connection with the operation of the mortgaged Property, which are then due and payable. Notwithstanding the first sentence of this paragraph, the City may recover directly from Developer or from any other party:

1. damages, costs and expenses incurred by the City as a result of fraud or criminal act or acts of Developer or a partner, shareholder, officer, director or employee of Developer, or of a member or general or limited partner of Developer, or of a general or limited partner of such member or general or limited partner;

2. damages, costs and expenses incurred by the City as a result of misappropriation of funds provided for the construction of the Improvements, rents and revenues from the operation of the Improvements or proceeds of insurance policies or condemnation proceeds;

3. any and all amounts owing by Developer pursuant to the indemnification regarding Hazardous Substances under the Environmental Indemnity, and

4. all court costs and attorneys’ fees reasonably incurred in enforcing or collecting upon any of the foregoing exceptions (provided that city will pay developer’s reasonable 290
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court costs and attorneys’ fees if developer is the prevailing party in such enforcement or collection action).

ARTICLE VII. GENERAL PROVISIONS
Section 7.01 Notices
Formal notices, demands and communications between the City and the Developer and Investor Limited Partner will be sufficiently given if dispatched by registered or certified mail, postage prepaid, return receipt requested, to the principal offices of the City and the Developer, as designated in Section 1.04 and 0 hereof, and to the Investor Limited Partner at the address given in the LMIHAF Note. Such written notices, demands and communications may be sent in the same manner to such other addresses as either party may from time to time designate by mail as provided in this Section 7.01. Any notice that is transmitted by electronic facsimile transmission followed by delivery of a “hard” copy, will be deemed delivered upon its transmission; any notice that is personally delivered (including by means of professional messenger service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal Service), will be deemed received on the documented date of receipt by the recipient; and any notice that is sent by registered or certified mail, postage prepaid, return receipt required will be deemed received on the date of receipt thereof.

Section 7.02 Conflicts of Interest
a. No member, official or employee of the City will have any personal interest, direct or indirect, in this Agreement nor will any such member, official or employee participate in any decision relating to the Agreement which affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is, directly or indirectly, interested. b. 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.

Section 7.03 Nonliability of City Officials and Employees No member, official, employee or consultant of the City will be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the City or for any amount which may become due to the Developer or to its successor, or on any obligations under the terms of this Agreement.

Section 7.04 Force Majeure
In addition to specific provisions of this Agreement, performance by either party hereunder will not be deemed to be in default where delays or defaults are due to Force Majeure Events. 291
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Section 7.05 Inspection of Books and Records
a. Developer will maintain complete, accurate, and current records pertaining to the Property for a period of five (5) years after the creation of such records, and shall permit any duly authorized representative of the City to inspect and copy records, during regular business hours upon reasonable advance notice. Records must be kept accurate and current. b. The City reserves the right to inspect, monitors, and observe work and services performed by Developer at any and all reasonable times. c. The City reserves the right to audit the records of Developer any time during the performance of this Agreement and for a period of five years after final payment is made under this Agreement.
d. If required, Developer will provide the City with a certified audit of Developer’s records representing the January 1 – December 31 fiscal year during which the Project becomes Complete, pursuant to the requirements of OMB Circular A-133. e. Access will be immediately granted to the City, HUD, the Comptroller General of the United States, or any of their duly authorized representatives to any books, documents, papers, and records of Developer or its contractors for the purpose of performing audits and examinations or making copies and transcriptions. This requirement must be included in all contracts and subcontracts.

Section 7.06 Approvals
a. Except as otherwise expressly provided in this Agreement, approvals required of City or Developer in this Agreement, including the attachments hereto, will not be unreasonably withheld or delayed. All approvals will be in writing. Except as otherwise expressly provided in this Agreement, failure by either party to approve a matter within the time provided for approval of the matter will not be deemed a disapproval, and failure by either party to disapprove a matter within the time provided for approval of the matter will not be deemed an approval. b. Except as otherwise expressly provided in this Agreement, approvals required of the City will be deemed granted upon the written approval of the City Manager or designee. City agrees to provide notice to Developer of the name of the City Manager’s designee on a timely basis, and to provide updates from time to time. Notwithstanding the foregoing, the City Manager or designee may, in his or her sole discretion, refer to the governing body of the City any item requiring City approval; otherwise, “City approval” means and refer to approval by the City Manager or designee.

Section 7.07 Real Estate Commissions
Neither the City nor the Developer will be liable for any real estate commissions, brokerage fees or finder fees which may arise from this transaction. The City and the Developer each 292
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represent to the other that it has employed no broker, agent, or finder in connection with this transaction.

Section 7.08 No Third Party Beneficiaries
This Agreement is made solely and specifically between the City and Developer and their respective successors and assigns; and, except as expressly provided otherwise in this Agreement, no other person will have any rights, interest or claims under this Agreement or be entitled to any benefits under or on account of this Agreement as a third party beneficiary or otherwise.

Section 7.09 Authority to Sign
Developer hereby represents that each person executing this Agreement on behalf of Developer has full authority to do so and to bind Developer to perform pursuant to the terms and conditions of this Agreement.

Section 7.10 No Partnership
Nothing contained in this Agreement will be deemed or construed to create a partnership, joint venture, or any other similar relationship between the parties hereto or cause City to be responsible in any way for the debts or obligations of Developer or any other Person.

Section 7.11 Compliance With Law
Developer agrees to comply with all the requirements now in force, or which may hereafter be in force, of all municipal, county, state and federal authorities, pertaining to the development and use of the Property and the Improvements, as well as operations conducted thereon. The judgment of any court of competent jurisdiction, or the admission of Developer in any action or proceeding, whether City be a party thereto or not, that Developer has violated any such ordinance or statute in the development and use of the Property will be conclusive of that fact as between City and Developer.

Section 7.12 Binding Effect
This Agreement, and the terms, provisions, promises, covenants and conditions hereof, will be binding upon and will inure to the benefit of the parties hereto and their respective heirs, legal representatives, successors and assigns.

Section 7.13 Incorporation by Reference
Each of the attachments and exhibits attached hereto is incorporated herein by this reference.
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Section 7.14 Counterparts
This Agreement may be executed by each party on a separate signature page, and when the executed signature pages are combined, will constitute one single instrument.

Section 7.15 Construction and Interpretation of Agreement a. The language in all parts of this Agreement will in all cases be construed simply, as a whole and in accordance with its fair meaning and not strictly for or against any party. The parties hereto acknowledge and agree that this Agreement has been prepared jointly by the parties and has been the subject of arm’s length and careful negotiation over a considerable period of time, that each party has been given the opportunity to independently review this Agreement with legal counsel, and that each party has the requisite experience and sophistication to understand, interpret, and agree to the particular language of the provisions hereof. Accordingly, in the event of an ambiguity in or dispute regarding the interpretation of this Agreement, this Agreement will not be interpreted or construed against the party preparing it, and instead other rules of interpretation and construction will be utilized.
b. If any term or provision of this Agreement, the deletion of which would not adversely affect the receipt of any material benefit by any party hereunder, will be held by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement will not be affected thereby and each other term and provision of this Agreement will be valid and enforceable to the fullest extent permitted by law. It is the intention of the parties hereto that in lieu of each clause or provision of this Agreement that is illegal, invalid, or unenforceable, there be added as a part of this Agreement an enforceable clause or provision as similar in terms to such illegal, invalid, or unenforceable clause or provision as may be possible. c. The captions of the articles, sections and subsections herein are inserted solely for convenience and under no circumstances are they or any of them to be treated or construed as part of this instrument.
d. References in this instrument to this “Agreement” mean, refer to and include this instrument as well as any riders, exhibits, addenda and attachments hereto (which are hereby incorporated herein by this reference) or other documents expressly incorporated by reference in this instrument. Any references to any covenant, condition, obligation, and/or undertaking “herein,” “hereunder,” or “pursuant hereto” (or language of like import) means, refer to, and include the covenants, obligations, and undertakings existing pursuant to this instrument and any riders, exhibits, addenda, and attachments or other documents affixed to or expressly incorporated by reference in this instrument.
e. As used in this Agreement, and as the context may require, the singular includes the plural and vice versa, and the masculine gender includes the feminine and vice versa. 294
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Section 7.16 Entire Agreement, Waivers and Amendments
a. This Agreement will be executed in three duplicate originals each of which is deemed to be an original. This Agreement will constitute the entire understanding and agreement of the parties.
b. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the parties with respect to all or any part of the Property.
c. All waivers of the provisions of this Agreement must be in writing and signed by the appropriate authorities of the City or the Developer, and all amendments hereto must be in writing and signed by the appropriate authorities of the City and the Developer. This Agreement and any provisions hereof may be amended by mutual written agreement by the Developer and the City.

Section 7.17 Time for Acceptance of Agreement by City
This Agreement, when executed by Developer and delivered to City, must be authorized, executed and delivered by City within sixty (60) days after date of signature by Developer or this Agreement may be terminated by Developer upon written notice to City. The effective date of this Agreement will be the date when this Agreement has been executed by City. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
[SIGNATURES ON FOLLOWING PAGE]
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Page S-1
IN WITNESS WHEREOF, City and Developer have signed this Agreement as of the date first written above.
“CITY”
CITY OF ORANGE, a municipal corporation of the
State of California
By: ___________________
Mark A. Murphy, Mayor
ATTEST:
_______________________
Pamela Coleman, City Clerk
APPROVED AS TO FORM:

By:_______________________________
Gary A. Sheatz, City Attorney
[SIGNATURES CONTINUE ON NEXT PAGE]
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Page S-2
“DEVELOPER”
Mercy Housing California 107, L.P.,
a California limited partnership
By: Mercy Housing California 107 LLC,
a California limited liability company,
its general partner
By: Mercy Housing Calwest,
a California nonprofit public benefit
corporation, its sole member/manager
By: ____________________________
Erika Villablanca,
Vice President
297
AA
18 18
1 1
FF
A-301
1 A-301 3
A-301 2
A-301
4 A-050
1 10' x 60' DROP-OFF AISLE PER
CITY OF ORANGE 17.34.170

32.12.A

32.13.E
TYP. 32.17.C
TYP. 32.12.A
TYP. 32.12.A
TYP. 32.13.D
TYP. 32.92.A TYP. 32.92.A

32.13.D

32.17.C

32.13.D

32.17.C

32.13.E

12.93.C

12.93.F

PROJECT AREA
(NEW) 32.17.G

32.14.B

32.17.G

32.10.C

32.10.D

32.10.B

02.02.A

02.02.B

02.01.A

02.02.A

33.05.A
41'-0" 5 SPACES @ 9'-0" = 36'-0" 5'-0" 3 SPACES @ 9'- 0" = 27'-0" 3'-0"
18'-0"

DRIVE AISLE
25'-0"

DROP OFF
10'-0"

BOUNDARY OF

SPACES DESIGNATED

FOR UNASSIGNED

RESIDENTIAL PARKING
(N) TRASH

ENCLOSURE
A-050
11 6'-0" 6 SPACES @ 9'-0" = 54'-0"
± 27'-8"
9'-0"
3 SPACES + 1 VAN ADA SPACE
@ 9'-0" = 36'-0" 5'-0"
2 SPACES
@ 9'-0" = 18'-0" 6'-0"
18'-0"
± 25'-6"
18'-0" 25'-0" MIN
18'-0"
3'-0"
4 SPACES @
9'-0" = 36'-0"
5'-0"
4 SPACES @
9'-0" = 36'-0"
18'-0"
25'-0" MIN 18'-0"
2 SPACES
@
8'-0" = 16'-0"
TYP
R 2' - 0"

33.50.B

32.13.G

32.13.G
R01 R02 R03 R04 R05 R06 R07
R08 R09 R10 R11 R12 R13 R14 R15
R16
R17
R18
R19
R20
R21
R22
R23
R24
R25
R26
R27
R28
R29
R30
R31
R32
R33
R34
8 SPACES
@ 9'-0" = 72'-0" 8'-0"
10 SPACES = (E) 87'-6"

MOTHERHOUSE
SEE A -100 THRU A -213 FOR

ARCHITECTURAL PROPOSED

SCOPE OF WORK

02.02.A

02.02.A

32.17.B

32.17.B

32.17.B
1 1
S. BATAVIA STREET

21.11.C 2

CONCRETE PAVING

ASPHALT PAVING
(E) BUILDING

ACCESSIBLE PATH OF TRAVEL
PATH OF TRAVEL (P.O.T.) AS INDICATED, IS A COMMON BARRIER FREE ACCESS ROUTE WITHOUT ANY ABRUPT VERTICAL CHANGES EXCEEDING 1/2" BEVELED AT 1:2 MAXIMUM SLOPE, EXCEPT THAT LEVEL CHANGES DO NOT EXCEED 1/4" VERTICAL AND IS AT LEAST 48" WIDE. THE PATH SURFACE IS SLIP RESISTANT, STABLE, FIRM, AND SMOOTH. PASSING SPACES (11B-403.2) AT LEAST 60"x60" ARE LOCATED NOT MORE THAN 200' APART. PARTS OF P.O.T. WITH CONTINUOUS GRADIENTS HAVE 60" LEVEL AREAS (11B-403.7) NOT MORE THAN 400' APART. THE CROSS-SLOPE DOES NOT EXCEED 2% AND SLOPE IN THE DIRECTION OF TRAVEL IS LESS THAN 5% UNLESS OTHERWISE INDICATED. (POT) SHALL BE MAINTAINED FREE OF OVERHANGING OBSTRUCTIONS TO 80" MINIMUM (11B-307.4) AND PROTRUDING OBJECTS GREATER THAN 4" PROJECTION FROM WALL AND ABOVE 27" AND LESS THAN 80" (11B-307). ARCHITECT SHALL VERIFY PATH OF TRAVEL CONFORMS WITH THE ABOVE.
(E) BUILDING, N.I.C.

DROP OFF AISLE

SITE PROJECT AREA

PROPERTY LINE, ASSUMED PROPERTY LINE
9'-0" M
IN
18'-0" MIN, TYP

WHITE STRIPING PER CITY OF
ORANGE STANDARD 17.34.130.E

CURB PER PLAN
4"
14"
4"

DRIVE AISLE
TYP
3'-0"
MAX
EQ EQ
9'-0" MIN 8'-0" MIN 9'-0" MIN
18'-0" M

IN, TYP

DIRECTION
6" MAX
EITHER
EQ EQ
36"x36" ISA

ACCESSIBLE PARKING SPACES

AND ACCESS AISLES SHALL NOT
OVERLAP MIN. REQUIRED CLEAR

WIDTH OF VEHICULAR WAYS OR

FIRE LANES
1:48 MAX

CROSS SLOPE, TYP
1:48 MAX

CROSS SLOPE, TYP

BORDERLINE TO BE PAINTED BLUE, TYP

HATCHED LINES TO BE PAINTED IN A

CONTRASTING COLOR TO THE AISLE

SURFACE, PREFERABLY WHITE ON
ASPHALT OR BLUE ON CONCRETE.

ACCESSIBLE

PARKING

SIGNAGE

ACESSIBLE VAN PARKING

SIGNAGE

ACCESS AISLE SHALL ADJOIN AN
ACCESSIBLE ROUTE. AISLE SHALL

BE ON THE PASSENGER SIDE OF ALL
VAN ACCESSIBLE STALLS.

NO

PARKING
12" MIN HIGH LETTERING,

PAINTED WHITE
C-22244
E
S
ATE
S RT
L
ECI
N
N. R

CFO FLA I O
C
32 AIN
T

HADE RC I ET
822
W

R HA J OODLOBED
E
DATE:

JOB NUMBER:

SHEET TITLE
DRAWN BY:

THE ARCHITECT DOES NOT REPRESENT THAT

THESE PLANS OR THE SPECIFICATIONS ARE

SUITABLE FOR ANY SITE OTHER THAN THE ONE

FOR WHICH THEY WERE SPECIFICALLY
PREPARED. THE ARCHITECT DISCLAIMS

RESPONSIBILITY FOR THESE PLANS AND

SPECIFICATIONS IF THEY ARE USED IN WHOLE OR

IN PART AT ANY OTHER SITE

ARCHITECT STAMP CONSULTANT STAMP

AGENCY APPROVAL

REVISIONS

CONSULTANTS

PROJECT OWNER & TITLE
SHEET NO.
#
DATE PLOTTED: FILE LOCATION:
560 HIGUERA STREET, SUITE C
SAN LUIS OBISPO, CA 93401
TEL (805) 476-0399
4/29/2022 11:38:34 AM C:\Users\zfarwell\Documents\Re vit Local Files\16064 - SSJ Motherhouse_A20_zfarwell19six.rvt A-020

SITE IMPROVEMENT
PLAN

VILLA ST JOSEPH

MOTHERHOUSE

RENOVATION
MARCH 18, 2022
16064.01 ZF
480 S BATAVIA ST
ORANGE, CA 92868

MERCY HOUSING
1500 S GRAND AVE, SUITE 100
LOS ANGELES, CA 90015
CITY BACKCHECK #2

C I V I L E N G I N E E R

L A N D S C A P E A R C H I T E C T

S T R U C T U R A L E N G I N E E R
M E C H., P L U M B., & E L E C T. E N G I N E E R

KIMLEY HORN
765 THE CITY DRIVE, SUITE 200
ORANGE, CA 92868
TEL 714.705.1360

CONCEPTUAL DESIGN AND PLANNING COMPANY
3195-C AIRPORT LOOP DRIVE, STUDIO ONE
COSTA MESA, CA 92626
TEL 949.399.0870
KPFF
700 SOUTH FLOWER STREET, SUITE 2100
LOS ANGELES, CA 90017
TEL 213.418.0201

SALAS OBRIEN
8825 RESEARCH DRIVE
IRVINE, CA 93618
TEL 949.753.1553
2108-278 PERMIT #

KEYNOTES

02.01.A ACCESSIBLE P.O.T FROM STREET TO ENTRY

02.02.A ACCESSIBLE PARKING STALL

02.02.B ACCESSIBLE P.O.T. FROM PARKING STALL TO ENTR Y

12.93.C COMMUNITY GARDEN BEDS, SEE LANDSCAPE DRAWING S

12.93.F PLANTER, SEE LANDSCAPE DRAWINGS

21.11.C FIRE DEPARTMENT CONNECTION (FDC). SEE APPRO VED FIRE UNDERGROUND PLANS FOR EXACT LOCATION.

32.10.B EXISTING ACCESSIBLE CONCRETE RAMP

32.10.C NEW ADDITIONAL CONCRETE STEP @ EXISTING ENTR Y STAIR. REFER TO CIVIL

32.10.D EXTEND HANDRAIL TO 24" BEYOND LAST STEP

32.12.A (E) ASPHALT PAVING TO REMAIN

32.13.D CONCRETE CURB (& GUTTER WHERE OCCURS) IN THE AREA OF WORK, UNLESS NOTED OTHERWISE. REFER TO CIVIL

32.13.E CONCRETE FLATWORK. REFER TO CIVIL

32.13.G REMOVE AND REPLACE (E) DRIVEWAY APRONS WITH CITY OF ORANGE STANDARD.

ALL WORKS WITHIN THE PUBLIC RIGHT-OF-WAY AND PUBLIC UTILITY EASEMENTS

WILL REQUIRE ENCROACHMENT PERMITS, INCLUDING SIDEWALK AND DRIVEWAY CONSTRUCTIONS.

32.14.B RELOCATE EXISTING PARKING TO THE SOUTH TO AL LOW FOR NEW ACCCESSIBLE CONCRETE SIDEWALK & CURB. REFER TO CIVIL DRAWINGS

32.17.B 36” WIDE TRUNCATED DOMES BAND

32.17.C NEW WHITE PARKING STRIPING DOUBLE WIDE & ROU NDED PER CITY OF ORANGE STANDARD 17.34.130.E

32.17.G DECORATIVE ACCENT PAVING MATERIAL. REFER TO LANDSCAE DRAWINGS

32.92.A LANDSCAPE AREA, REFER TO LANDSCAPE DRAWINGS

33.05.A (N) UNDERGROUND INFILTRATION BASIN. REFER TO CIVIL

33.50.B REPLACE THE EXISTING BACKFLOW WITH AN APPROV ED BACKFLOW PREVENTION DEVICE FOR THE EXISTING DOMESTIC AND FIRE SERVICE SUPPLYING THE BUILDING.

THE DEVICE SHALL BE LOCATED BEHIND THE SIDEWALK WITHIN THE NEAREST SOFT-SCAPE. A 3-FOOT CLEARANCE MUST BE MAINTAINED AROUND THE BACKFLOW PREVENTION DEVICE FOR TESTING PURPOSES. SEE CIVIL DWGS FOR MORE INFO.

SITE PLAN LEGEND
1/16" = 1'-0" 9SITE PLAN

PROJECT
NORTH
3/16" = 1'-0" 10 STANDARD PARKING 3/16" = 1'-0" 15 ADA PARKING - 90 NO. DATE DESCRIPTION
A 11/05/2020 ENTITLEMENT APPROVAL
B 09/03/2021 BUILDING SUBMITTAL
1 01/14/2022 BACKCHECK 1
2 02/25/2022 BACKCHECK 2

SITE PLAN GENERAL NOTES

1. SEE MECHANICAL, ELECTRICAL, AND CIVIL DRAWINGS FO R UTILITIES. 2108-278 PERMIT #
APRIL 29, 2022
Attachment 1
298
legal rev. (010698)
All that certain real property situated in the County of Orange, State of California, described as follows:

PARCEL 1:

PARCEL A:

THE BUILDING AND IMPROVEMENTS WITHIN THE AIRSPACE OF PARCEL 3 OF PARCEL MAP NO. 2019-166, IN THE CITY OF ORANGE, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK ___, PAGES ____ TO __, INCLUSIVE

OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY,

WHICH BUILDING AND IMPROVEMENTS ARE AND SHALL REMAIN REAL PROPERTY PARCEL B:

RECIPROCAL EASEMENTS FOR INGRESS, EGRESS, SUPPORT, ENCROACHMENTS, AND UTILITIES AS GRANTED IN THE DOCUMENT ENTITLED ‘RECIPROCAL EASEMENT AND MAINTENANCE AGREEMENT RECORDED ____, AS INSTRUMENT O. 2022____, OFFICIAL RECORDS OF SAID COUNTY, SUBJECT TO THE TERMS AND CONDITIONS CONTAINED THEREIN.

PARCEL C:

AN EASEMENT FOR VEHICULAR AND PEDESTRIAN INGRESS, EGRESS, PARKING UTILITIES AND RECREATION AS GRANTED IN THE DOCUMENT ENTITLED ‘GRANT OF EASEMENT AND MAINTENANCE AGREEMENT RECORDED ____, AS INSTRUMENT O. 2022____, OFFICIAL RECORDS OF SAID COUNTY, SUBJECT TO THE TERMS AND CONDITIONS CONTAINED THEREIN.

PARCEL 2:

PARCEL A:

PARCEL 3 OF PARCEL MAP NO. 2019-166, IN THE CITY OF ORANGE, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK ___, PAGES ____ TO __, INCLUSIVE OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

EXCEPTING THEREFROM THE BUILDING AND IMPROVEMENTS WITHIN THE AIRSPACE OF PARCEL 3, WHICH BUILDING AND IMPROVEMENTS ARE AND SHALL

REMAIN REAL PROPERTY
PARCEL B:

RECIPROCAL EASEMENTS FOR INGRESS, EGRESS, SUPPORT, ENCROACHMENTS, AND UTILITIES AS GRANTED IN THE DOCUMENT ENTITLED ‘RECIPROCAL EASEMENT AND MAINTENANCE AGREEMENT RECORDED ____, AS INSTRUMENT O.

Attachment 2
299
legal rev. (010698)
2022____, OFFICIAL RECORDS OF SAID COUNTY, SUBJECT TO THE TERMS AND CONDITIONS CONTAINED THEREIN.

PARCEL C:

AN EASEMENT FOR VEHICULAR AND PEDESTRIAN INGRESS, EGRESS, PARKING UTILITIES AND RECREATION AS GRANTED IN THE DOCUMENT ENTITLED ‘GRANT OF EASEMENT AND MAINTENANCE AGREEMENT RECORDED ____, AS INSTRUMENT O. 2022____, OFFICIAL RECORDS OF SAID COUNTY, SUBJECT TO THE TERMS AND CONDITIONS CONTAINED THEREIN.
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Method of Financing

ATTACHMENT NO. 3

METHOD OF FINANCING
This is the Method of Financing attached to the Affordable Housing Agreement between the City of Orange (the “ City”) and Mercy Housing California 107, L.P, a California limited partnership (“Developer”), relating to Developer’s adaptive reuse of a portion of the existing Motherhouse (former convent) building located in an airspace parcel on the Property, to be acquired by Developer, for a 50-unit (including one manager’s unit) senior residential rental project, to be rented at Affordable Rents to Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households.

The Project will be financed by a combination of construction and permanent loans, a LMIHAF Loan, a HOME Loan, an In Lieu Fees Loan, and Developer Equity derived from the syndication of Four Percent Low Income Housing Tax Credits.

1. Definitions. Unless otherwise defined herein, capitalized terms will have the meanings ascribed to them in the Affordable Housing Agreement.

2. Acquisition and Development Costs . The parties estimate that the total Acquisition and Development Costs will be approximately $36,843,622, of which approximately $5,820,000 is allocated to acquisition costs and approximately $31,023,622 is allocated to development, construction, and rehabilitation costs. The In Lieu Fees Loan consists of a loan of construction to permanent funds in the amount of $372,756. The HOME Loan consists of a loan of construction to permanent funds in the amount of $651,244. The LMIHAF Loan consists of a loan of construction to permanent funds in the amount of $576,000.

3. Sources of Construction Financing . The parties anticipate that the Acquisition and Development Costs will be financed during the Construction Period with the following combinations of funds:
a. The Construction Loan, in the approximate original principal total amount of $22,630,399, with holdbacks in accordance with the applicable loan documents, to be secured by a first deed of trust.
b. A second priority HOME Loan in the original principal amount of $651,244, less a $65,125 hold-back, equal to ten percent (10%) of disbursements during construction.
c. A second priority LMIHAF Loan in the original principal amount of $576,000, less a $57,600 hold-back, equal to ten percent (10%) of disbursements during construction.
d. A second priority In Lieu Fees Loan in the original principal amount of $372,756, less a $37,276 hold-back, equal to ten percent (10%) of disbursements during construction.
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Method of Financing

e. A third priority California Housing Finance Agency Special Needs Housing Program (CALHFA SNHP) Loan in the principal amount of $3,696,893, to be secured by a second deed of trust
f. A fourth priority Seller Carryback Loan in the principal amount of $5,705,000, to be secured by a second deed of trust.
g. Costs deferred to Conversion in the amount of approximately $1,269,965. h. Developer Equity consisting of: (i) advances and capital contributions made by Developer’s Limited Partner, in the approximate amount of $2,233,548; and (ii) the deferral of a portion of the Developer Fee in the amount of approximately $710,208 (“Deferred Developer Fee”), which will be paid from the net cash flow of the Project. Developer’s right to pay the theretofore unpaid balance of the Deferred Developer Fee from the net cash flow of the Project will be prior to the City’s right to receive Residual Receipts payments.
i. Developer will be responsible during the Construction Period to provide funds if and as needed to pay for cost overruns and contingencies not otherwise funded by the sources of funds as described herein.

4. Sources of Permanent Financing. Developer must make every reasonable effort to structure the terms of the permanent financing in a way that will minimize the amount of the City Loans needed to fill the financing gap. The parties anticipate that the Acquisition and Development Costs will be financed during the Permanent Period with the following combinations of funds:
a. The first priority California Housing and Community Development No Place Like Home (HCD NPLH) Loan in the principal amount of $5,641,722, to be secured by a first deed of trust.
b. The Orange County Housing and Community Development HOME loan in the principal amount of $1,020,600, and an Orange County MHSA loan in the principal amount of $1,400,000 (sometimes collectively referred to as the “OCHCD Loans”), to be secured by a second deed of trust. c. The HOME Loan described in paragraph 3.c above in the original principal amount of $651,244, secured by a third priority deed of trust. d. The LMIHAF Loan described in paragraph 3.d above in the original principal amount of $576,000, secured by a third priority deed of trust. e. The In Lieu Fees Loan described in paragraph 3.e above in the original principal amount of $372,756, secured by a third priority deed of trust. 302
Villa St. Joseph – 480 South Batavia Street
Method of Financing

f. A fourth priority California Housing Finance Agency Special Needs Housing Program (CALHFA SNHP) Loan in the principal amount of $3,696,893, to be secured by a fourth deed of trust.
g. A fifth priority Seller Carryback Loan in the principal amount of $5,705,000, to be secured by a fifth deed of trust.
h. Developer Equity, consisting of (1) the Deferred Developer Fee described in paragraph 3.h above in the approximate amount of $710,208 (to be paid to the extent contractually and financially available from the net cash flow of the Project) plus (2) an additional Limited Partner’s Capital Contribution in the approximate amount of approximately $16,471,590.

5. Project Budget. The parties anticipate that all Acquisition and Development Costs will be as set forth in the Project Budget attached to the Affordable Housing Agreement as Attachment No. 5, which is incorporated herein by this reference (the “ Project Budget ”). The Project Budget will be subject to change from time-to-time, subject to the prior written approval of the City Manager or designee (which approval will not be unreasonably withheld, conditioned or delayed), upon which approval, the Project Budget will be replaced by the approved revised Project Budget, and the corresponding amounts set forth herein will be deemed replaced consistent therewith. Within the respective times provided therefor in the Schedule of Performance, the Developer will obtain all approvals needed for the Construction Loan and demonstrate, to the satisfaction of the City Manager, that all Developer Equity will be available for payment or refinancing of Development Costs when and as required by this Method of Financing. Pursuant to Section 3.02.c of the Affordable Housing Agreement, the City Manager is authorized to approve additional subordination agreements to be executed by the City, which may change the orders of priority of the junior deeds of trust referred to in Sections 3 and 4 of this Method of Financing.

6. Evidence of Financing . The sum of the sources of financing identified in paragraph 3 above will, at all times, be sufficient to pay all Acquisition and Development Costs as set forth in the most recently approved Project Budget. Prior to the Construction Financing Event, Developer will submit for City review and approval evidence of such financing, including: (a) copies of all documents required by the Construction Lender to obtain construction financing; (b) firm commitments for the Permanent Financing and copies of all documents that will be required to obtain the Permanent Financing; and (c) the amended and restated limited partnership agreement upon inclusion of the Investor Limited Partner, including all exhibits thereto, and other documentation evidencing the availability of the Limited Partner Capital Contribution, and such other documentation as may be appropriate to evidence other Developer Equity. The City will not unreasonably withhold its approval.

7. City Loans.
a. In accordance with and subject to the terms and conditions of the Affordable Housing Agreement and this Method of Financing, the City agrees to make the LMIHAF Loan, the In Lieu Fees Loan, and the HOME Loan to Developer and Developer agrees to borrow such funds for the purpose of paying Acquisition and Development Costs. 303
Villa St. Joseph – 480 South Batavia Street
Method of Financing

b. Developer hereby acknowledges that the City Loans are intended to be “gap” financing, not to exceed the amount needed to bridge the gap between the total Acquisition and Development Costs and the maximum Senior Loan obtainable by Developer plus the maximum amount of Developer’s Equity set forth above but in any event not to exceed the dollar amount set forth above. If at any time Developer obtains additional financial assistance, Developer must promptly notify the City. The City will determine if such additional assistance would result in an over-subsidy of the Project, in which case, the City and Developer will mutually agree upon appropriate procedures for reducing the City Loan to eliminate the over-subsidy. c. The City Loan will be used exclusively to pay Acquisition and Development Costs identified in the Project Budget.
d. At the Construction Financing Event, the City and Developer will execute and deliver such instruments and documents as may be necessary to evidence and secure the City Loans, consistent with the terms of the Affordable Housing Agreement and this Method of Financing, and each in a form that is acceptable to the City Manager or designee, including the following documents, as applicable, which are referred to as the “City Loan Documents”:

1. Agreement Containing Covenants;

2. Notice of Affordability Restrictions on Transfer of Property;

3. HOME Regulatory Agreement;

4. Promissory Note evidencing the LMIHAF Loan;

5. Promissory Note evidencing the HOME Loan;

6. Promissory Note evidencing the In Lieu Fees Loan;

7. City Deed of Trust securing the LMIHAF Loan, the In Lieu Fees Loan, and the HOME Loan;

8. Assignment of Rents and Leases;

9. Assignment of Agreements;

10. Environmental Indemnity; and

11. UCC-1 Financing Statement.

8. Subordination.
a. The lien of the City Deed of Trust, but not the Agreement Containing Covenants or the HOME Regulatory Agreement, will be subordinate to the lien created by the Construction Loan Deed of Trust and, during the Permanent Period, the HCD NPLH Loan and the 304
Villa St. Joseph – 480 South Batavia Street
Method of Financing

OCHCD Loans Deeds of Trust and any other of the Senior Loan Documents and all of the terms and conditions contained in the Senior Loan Documents.
b. Prior to the Construction Financing Event, the City Manager or designee will execute a Subordination Agreement that is consistent with applicable laws and regulations governing subordination of the LMIHAF Loan, the In Lieu Fees Loan, and the HOME Loan and is mutually acceptable to the City Manager or designee, the Construction Lender and Developer.

The Subordination Agreement will subordinate the City Deed of Trust, but not the Agreement Containing Covenants or the HOME Regulatory Agreement, to the Construction Loan Deed of Trust, and, during the Permanent Period, the HCD NPLH Loan and the OCHCD Loans Deeds of Trust and other Senior Loan Documents. The subordination agreement must provide the City with all rights under California Civil Code Section 2924b and 2924c and must contain written commitments reasonably designed to protect the City’s investment in the event of a default. Such written commitments will provide for, but not necessarily be limited to: (i) a right to cure a default on the Senior Loan deed of trust; (ii) a right to negotiate with Senior Lender after notice of default and prior to Senior Lender commencing foreclosure proceedings; (iii) a right to purchase Developer’s interest in the Property at any time after a default on the Senior Loan; and (iv) an agreement that if prior to foreclosure of the Senior Loan, the City takes title to the Developer’s leasehold interest in the Property and cures the default on the Senior Loan, the Senior Lender will not exercise any right it may have to accelerate the Senior Loan by reason of the transfer of title to the City.

9. Recordation. Upon the Construction Financing Event, the Title Company will record the recordable City Loan Documents in accordance with instructions provided by the City, and will be prepared to issue to the City an ALTA policy of title insurance, insuring the City Deed of Trust as a second priority lien on the Property, in amounts and with endorsements as the City may determine is appropriate.

10. Disbursement of City Loans.
a. The City Loans will be disbursed for the payment of Acquisition and Development Costs in accordance with the Evidence of Financing approved by the City. b. The City Loans will be disbursed based on vouchers for actual expenses incurred or paid, accompanied by contractor/subcontractor invoices and other information and documentation (e.g., lien releases) requested or required by the City. The City will have the right to condition any disbursement upon receipt and approval of such documentation, evidence or information that it may request, including, but not limited to, vouchers, invoices, and architect’s, inspector’s and/or engineer’s periodic certifications of the percentage and/or stage of construction that has been completed. Requests for HOME Loan disbursements must be submitted on forms specified by the City, with adequate and proper documentation of eligible costs incurred in compliance with 24 CFR 92.206 and necessary for HUD IDIS disbursement requirements. The City will have the right in its sole discretion to make disbursements of funds payable jointly to Developer and third parties entitled to such payment. The City will have the right to review and audit all records of Developer pertaining to disbursement of the City Loan. Developer must maintain such records for a period of not less than five years after Completion. 305
Villa St. Joseph – 480 South Batavia Street
Method of Financing

c. Disbursements upon Applications for Payment will be subject to a ten percent (10%) retention. Developer may submit a final invoice upon Completion. Final payment, including retention previously withheld, will be made in accordance with the Affordable Housing Agreement and this Method of Financing.
d. Designated representatives of the City will have the right to participate in weekly construction meetings during the construction of the Improvements and to approve proposed finishes, colors, fixtures, and like matters.

11. Repayment Terms. The repayment terms of the City Loans will be as set forth in the LMIHAF Note, the In Lieu Fees Note, and the HOME Note attached to the Affordable Housing Agreement as Attachments No. 9, 10, and 11, respectively.

12. Conditions Precedent to Construction Financing Event. The Construction Financing Event is conditioned upon each of the following occurring to the satisfaction of, and in a form approved by, the City Manager prior to the time for the Construction Financing Event set forth in the Schedule of Performance:
a. Developer submits evidence that the final working drawings have been approved by the City, and, to the extent required by the Affordable Housing Agreement, the City Manager or designee;
b. Developer submits a copy of the general construction contract between the Developer and a licensed general contractor approved by the City Manager or designee, covering all construction required by the Affordable Housing Agreement and the approved final working drawings;
c. Developer submits for City approval copies of the mechanical, electrical, plumbing, and framing subcontracts and subcontracts for other trades identified by the City;
d. Developer submits for City approval copies of contracts with the architect, the property manager (which must contain a provision allowing Developer’s termination of the management agreement without cause, upon thirty (30) days prior written notice), and other consultants and service providers identified by the City;
e. Developer submits a final Project Budget, current as of the Construction Financing Event date, demonstrating to the satisfaction of the City Manager or designee the availability of sufficient funds to pay all Acquisition and Development Costs;
f. Developer submits evidence satisfactory to the City Manager or designee that the Developer has financing commitments sufficient to pay all Acquisition and Development Costs in accordance with the Affordable Housing Agreement, including the Construction Loan, Seller Carryback 306
Villa St. Joseph – 480 South Batavia Street
Method of Financing

Loan, City Loans, HFA SNHP Loan, HCD NPLH Loan, OCHCD Loans, and Developer’s Equity (including the Limited Partner Capital Contribution) in the respective amounts set forth in this Method of Financing;
g. Developer submits copies of final Construction Loan Documents; h. Developer submits copies of Amended and Restated Limited Partnership Agreement (admitting Investor Limited Partner) or other final limited partnership agreement and related documents;
i. Developer submits the evidence of insurance policies and the endorsements required by the Affordable Housing Agreement;
j. Developer submits evidence satisfactory to the City Manager or designee that Developer has satisfied all conditions precedent to the issuance of all Permits necessary for the construction of the Improvements, other than payment of fees (for which funds have been budgeted in the Project Budget) and conveyance of title;
k. Developer submits, if requested by the City, and City approves, an estimated draw schedule for the City Loan;
l. Developer submits the Annual Project Budget for the first year of operation, as required by the Affordable Housing Agreement;
m. Developer, Construction Lender, and City agree on a Disbursement Agreement providing for disbursement of the City Loan, Developer Equity, and Construction Loan;
n. Developer, Senior Lender, and City agree on Subordination Agreements; o. Title Insurance Company is prepared to issue the title insurance policies required by the Affordable Housing Agreement;
p. Developer duly executes and delivers to the City or into escrow the City Loan Documents;
q. Developer submits to the City a fully executed agreement to enter into a contract for Project-based HUD Section 8 vouchers for 18 Units; and r. City Manager determines that Developer is not in default of its obligations to the City under the Affordable Housing Agreement.

Notwithstanding the foregoing, the City, in the sole discretion of the City Manager, may waive in writing any of the foregoing conditions precedent to the Construction Financing Event.

A waiver of any of the foregoing conditions will not operate in any way as a waiver, or estoppel 307
Villa St. Joseph – 480 South Batavia Street
Method of Financing

with respect to, any subsequent or other failure to comply with such condition, or any other condition contained in the Affordable Housing Agreement, this Method of Financing, or any of the other City Loan Documents. The City’s approval to record the City Deed of Trust will confirm the City’s approval or waiver of the conditions set forth in this Section 12. 308
Villa St. Joseph – 480 South Batavia Street
Schedule of Performance

ATTACHMENT NO. 4

SCHEDULE OF PERFORMANCE

1. Submittal - Management Plan and Maintenance
Program. Developer will submit to the City for
approval the Management Plan (including a
Tenant Selection and Eligibility Plan) and the
Maintenance Program.

Prior to the initial lease-up of
the Project.

2. Submittal – Affirmative Marketing Plan.

Developer will prepare and submit to the City for
approval the Affirmative Marketing Plan
described in paragraph b.9 of Section 5.01 of the
Agreement.

Prior to the initial lease-up of
the Project.

3. Submittal - Annual Project Budget.

Developer will submit to the City for approval a
current Annual Project Budget for the first year of
operation.

Prior to submittal of the
Affordable Housing
Agreement to the City for
approval; revisions to the
approved Annual Project
Budget must be submitted for
approval prior to the scheduled
date for the Construction
Financing Event.

4. Approval of Affordable Housing Agreement by
the City Council. The City will review and
consider approval of the Affordable Housing
Agreement, and consider authorizing the
execution and delivery of the Affordable Housing
Agreement to the Developer.

Within sixty (60) days after
submission to City of the
Affordable Housing
Agreement executed by
Developer.

5. Submittal - Final Construction Drawings and
Specifications. Developer will prepare and
submit to the City for approval the Final
Construction Drawings and Specifications.

Within ninety (90) days after
execution of the Affordable
Housing Agreement by the
City.
309
Villa St. Joseph – 480 South Batavia Street
Schedule of Performance

6. Approval - Final Construction Drawings and
Specifications. The City will approve or disap-
prove the Final Construction Drawings and
Specifications.

Within one hundred twenty
(120) days after Developer
submits for City approval the
complete Final Construction
Drawings and Specifications.

7. Submittal – Subcontracts. Developer will submit
to the City for approval the subcontracts required
by Section 4.03 of the Agreement.

Ten (10) days prior to the
scheduled date for the
Construction Financing Event.

8. Submittal – Environmental Assessments.

Developer will deliver to the City copies of
environmental assessments as required by Section

4.02 of the Agreement.

Two weeks prior to the
scheduled date for the
Construction Financing Event.

9. Submittal - Evidence of Financing.

Developer will submit to the City substantially
final Construction Loan documents, tax credit
documents, and documentation of Developer
Equity, as described in the Method of Financing.

Ten (10) days prior to the
scheduled date for the
Construction Financing Event.

10. Approval of Financing. The City will approve or
disapprove the evidence of financing.

Within ten (10) days after
receipt of each such submittal
of evidence of financing to the
City.

11. Construction Financing Event. All conditions
precedent to the Construction Financing Event
will have been satisfied.

Within one (1) year after
execution of the Affordable
Housing Agreement by the
City.

12. Submittal - Tenant Lease Form. Developer will
prepare and submit to the City for approval the
tenant lease form with the lease provisions
described in the Agreement Containing
Covenants and the HOME Regulatory
Agreement.

Prior to the initial lease-up of
the Project.
310
Villa St. Joseph – 480 South Batavia Street
Schedule of Performance

13. Approval – Management Plan, Tenant Selection
and Eligibility Plan, Maintenance Program,
Affirmative Marketing Plan, Tenant Lease Form.

The City will approve or disapprove Developer’s
proposed Management Plan, Tenant Selection and
Eligibility Plan, Maintenance Program,
Affirmative Marketing Plan, and Tenant Lease
Form.

Prior to the initial lease-up of
the Project.

14. Commencement of Construction. Developer will
commence construction and rehabilitation of the
Improvements on the Property.

Within sixty (60) days after the
Construction Financing Event,
but no later than fourteen (14)
months after execution of the
Affordable Housing
Agreement by the City.

15. Completion of Construction. Developer will
complete construction and rehabilitation of the
Improvements on the Property.

Not later than eighteen (18)
months after commencement
of construction or such later
date as may be approved by
the City. City Manager shall
not unreasonably withhold
approval of an extension not to
exceed an additional six (6)
months provided Developer is
diligently proceeding with
construction.

16. Submittal – Identity of Very Low Income and
Low Income HOME Units. Developer will submit
to the City for approval the street address and unit
numbers of the proposed Very Low Income and
Low Income HOME Units.

Thirty (30) days prior to initial
rental of the units.

17. Submittal – Rent Schedule. Developer will submit
its proposed rent schedule and utility allowance to
the City for approval.

Thirty (30) days prior to initial
rental of the units and on an
annual basis thereafter.
311

Prepared For: Mercy Housing CaliforniaPrepared By: California Housing Partnership CorporationVersion: 2.18 Revised: 9/2/2022Filename:

TABLE OF CONTENTS
Sources of Funds…………………………………………..………………………..……..…………………………………………..………………………..……..1 Cash Flow (Residential)…………………………………………..………………………..……..…………………………………………..………………………..……..11aUses of Funds…………………………………………..………………………..……..…………………………………………..………………………..……..2 Cash Flow (Commercial) …………………………………………..………………………..……..…………………………………………..………………………..……..11bDeveloper Fee Calculation…………………………………………..………………………..……..…………………………………………..………………………..……..3 Outstanding Debt & Reserves (Book)…………………………………………..………………………..……..…………………………………………..………………………..……..12aUnit Mix & Rental Income…………………………………………..………………………..……..…………………………………………..………………………..……..4 Outstanding Debt & Reserves (Tax)…………………………………………..………………………..……..…………………………………………..………………………..……..12bTax Credit Calculation…………………………………………..………………………..……..…………………………………………..………………………..……..5 Net Cash Flow Fee Accruals…………………………………………..………………………..……..…………………………………………..………………………..……..12cBase Year Income & Expense…………………………………………..………………………..……..…………………………………………..………………………..……..6 Schedule of Existing Debt…………………………………………..………………………..……..…………………………………………..………………………..……..12dMortgage Calculation & Bond Ratios…………………………………………..………………………..……..…………………………………………..………………………..……..7 Schedule of Deductions…………………………………………..………………………..……..…………………………………………..………………………..……..13Lease-up/Placed-in-Service Schedule…………………………………………..………………………..……..…………………………………………..………………………..……..8 Analysis of Taxable Income…………………………………………..………………………..……..…………………………………………..………………………..……..14Net Syndication Proceeds…………………………………………..………………………..……..…………………………………………..………………………..……..9 Capital Account & Exit Tax Liability…………………………………………..………………………..……..…………………………………………..………………………..……..15TCAC Calculations…………………………………………..………………………..……..…………………………………………..………………………..……..10a Investment Summary…………………………………………..………………………..……..…………………………………………..………………………..……..16TCAC Transfer Event Calculation…………………………………………..………………………..……..…………………………………………..………………………..……..10b Net Quarterly Benefits…………………………………………..………………………..……..…………………………………………..………………………..……..17

SOURCES OF FUNDS - PERMANENT

AMOUNT

TOTAL INTEREST COST
OID INTEREST RATEAMORT (Yr) COMMENTSTotal Permanent Debt:- Seller Carryback Loan (SJCO)5,705,0003.140%3.140% 55.0 Accrued Deferred Interest - Seller Carryback Loan (SJCO)433,092Cal HFA SNHP 3,696,8933.000%1.788% 55.0 Per Unit: 73,938 Accrued Deferred Interest - Cal HFA SNHP157,352County of Orange HOME Loan1,020,6003.000%1.788% 55.0 Per Unit: 20,412 HCD - NPLH Non-Competitive2,000,0003.000%1.903% 55.0 Per Unit: 40,000 HCD - NPLH Competitive3,641,7223.000%1.903% 55.0 Per Unit: 72,834 County of Orange MHSA Loan1,400,0003.000%1.788% 55.0 Per Unit: 28,000 City of Orange HOME Loan651,2443.000%1.788% 55.0 1,600,000 total City Loans Per Unit: 13,025 City of Orange LMIHA Loan576,0003.000%1.788% 55.0 Per Unit: 11,520 City of Orange In-Lieu Fees Loan372,7563.000%1.788% 55.0 Per Unit: 7,455 Deferred Developer Fee 710,2080.000%0.000%Capital Contributions General Partner (Developer Fee)0 Synd Costs 168,500 GP Capital 0 Net Equity for TCAC16,270,135 Limited Partners (Enterprise)16,438,635 Fed LIHTC:$0.9675 State LIHTC:$0.80 TOTAL SOURCES 36,803,502Surplus/(Shortfall) 0 Investor:PERMANENT LOAN INTEREST RATETRANCHE ATRANCHE B INVESTOR EQUITY STACKOTHER ASSUMPTIONSBase Rate 4.100%4.100%Cushion 1.000%1.000% LIHTC Equity (Federal+State)16,438,635 Current AFR: 3.14%MIP 0.000%0.000% Historic Tax Credit 0 AFR Month: 9/1/22GNMA/Servicing 0.000%0.000% Investment Tax Credit (Solar PV)0 AFR Cushion:0.00%Issuer 0.050%0.050%4,000Issuer min/yrSubtotal LP Equity16,438,635 Total U/W AFR:3.14%Trustee 0.000%0.000%2,000per annumRating 0.000%0.000% 0 per annum CA Certificated Credit Sale0Remarketing 0.000%0.000% 0 per annumTotal Investor Equity16,438,635Rebate Analyst 0.000%0.000% 0 per annumTotal 5.150%5.150%

SOURCES OF FUNDS - CONSTRUCTION
AMOUNTINTEREST RATE TERM (Mos.) COMMENTSUmpqua providing 30-month term, conversion anticipated in 28 months##Umpqua Tax-Exempt Construction Loan17,925,0005.480% 28 2,400,000supplemental request 15.5%of original allocUmpqua Taxable Construction Loan4,538,2645.980% 28Seller Carryback Loan (SJCO)5,705,0003.140% 28 Accrued Deferred Interest - Seller Carryback Loan (SJCO)433,092Cal HFA SNHP 3,696,8933.000% 28 Accrued Deferred Interest - Cal HFA SNHP157,352Costs Deferred Until Conversion1,272,173 See page 2 - right columnDeferred Developer Fee 710,208Capital Contributions LP Equity - Construction Period General Partner (Developer Fee)0 LP Equity used for const.2,365,520 14.39% GP Capital 0 LP Equity for bond collateral0 0.00% Limited Partners (Enterprise)2,365,520#REF! Total Equity During Const.2,365,520 14.39% TOTAL SOURCES 36,803,502 Syndication Costs 168,500Surplus/(Shortfall) 0 Net Equity for TCAC2,197,020Sources Less Deferred To Conversion:35,531,329 Less Costs Deferred to Conv.34,437,982

CONSTRUCTION LOAN INTEREST RATECONSTRUCTION LOAN VALUATIONTAX-EXEMPT BOND DATA Index Type: 30d SOFRRestricted NOI 130,03250% Test (see Page 7):52.60%Current Index: 2.28%OAR 5.00%Issuer Inducement: TBDSpread: 1.20%FMV per NOI 2,600,639CDLAC Allocation: 17,925,000 Base Interest Rate (not including cushion):3.48%Agg. Credit Value @ 0.97 16,438,635Percent of CDLAC Allocation Used:100.00%Cushion - Total 2.00%Perm-Only Soft Debt 9,662,322Const-only portion: 17,925,000Interest Rate (All-In) 5.48%Total Value 28,701,596LTV: 85.00% CDLAC Per-Unit Limit27,104,500 Bank underwriting cushion1.00%Max. Const. Loan Amount24,396,357 CDLAC 55% Limit 18,743,000 Index increase to close cushion1.00%Commitment Amount TBD CDLAC 52% Target17,721,000

SELLER POSITION
Proceeds of Sale: Uses of Cash to Seller:Sales Price 5,820,000Incl. Reserves & Personal PropertyCash to Seller 115,000includes legal fee of $15KSeller Carryback Note (5,705,000) Repayment of Debt 0Cash to Seller 115,000 Net Cash to Seller115,000 Mercy Villa St Joseph 2.18 pre-closing.xlsm
Villa St. Joseph
Attachment 5
312

Uses of Funds Version:2.18
100.00%COST ALLOCATIONS LIHTC ELIGIBLE BASISOTHER BASIS & COST ALLOCATIONS100.00%Assuming 266 Election?Yes Deferred toDepreciable CompletionLand/BasisITC TaxTotal Total Non-Non- Constr./ or forCredit BasisTOTALResidentialResidentialDepreciableResidentialNon-Resid.ExpensedAmortizedRehabAcquisitionPerm Conv.50% Test(Solar PV) ACQUISITION COSTS Total Purchase Price - Real Estate:5,820,000 Building - VSJ 5,820,0005,820,0000 5,820,000 0 5,820,000 05,820,000Legal - Acquisition 10,00010,0000 0 10,000 0 10,000 010,000Off-site Improvements 0 0 0 0 0 0 0 0 0 0 HARD COSTS Total Construction Contract:18,549,721
NEW CONSTRUCTIONDemolition 684,952684,9520 0 684,952 0 0 684,952 0684,952Hard Costs-Unit Construction14,109,10514,109,1050 14,109,105 0 0 14,109,105 014,109,105Personal Property in Construction Contract286,548286,5480 286,548 0 0 286,548 0286,548Site Improvements/Landscape413,177413,1770 413,177 0 413,177 0413,177GC - General Conditions827,480827,4800 827,480 0 827,480 0827,480GC - Overhead & Profit1,013,8241,013,8240 1,013,824 0 1,013,824 01,013,824GC - Insurance 331,315331,3150 331,315 0 331,315 0331,3150.05 Contingency - Escalation883,320883,3200 883,320 0 883,320 0883,3200.1 Contingency - Owner's Construction1,854,9721,854,9720 1,854,972 0 1,854,972 01,854,972 SOFT COSTSArchitecture - Design634,650634,6500 634,650 0 634,650 0634,6500Architecture - Supervision143,175143,1750 143,175 0 143,175 0143,1750Design/Engineering - Civil90,05590,0550 90,055 0 90,055 090,0550Phase I/II/Toxics Report16,00016,0000 16,000 0 16,000 016,000Special Inspections/CASp/ADA25,00025,0000 25,000 0 25,000 025,000Prevailing Wage Monitor45,00045,0000 45,000 0 45,000 045,0000Owner's Rep / Construction Supervision142,000142,0000 142,000 0 142,000 0142,0000Local Development Impact Fees1,125,6211,125,6210 1,125,621 0 1,125,621 01,125,621Impact Fee Waiver 0 0 0 0Local Permits/Fees 300,000300,0000 300,000 0 300,000 0300,000Utilty Connection Fees150,000150,0000 150,000 0 150,000 0150,0000Security During Const 0 0 0 0 0 0 0 0 0 0Real Estate Taxes During Const109,313109,3130 63,766 045,547 63,766 0 063,766Insurance During Const400,520400,5200 400,520 0 0 400,520 0 0400,5200Appraisal 5,0005,000 0 5,000 0 0 5,000 0 5,000Market/Rent Comp Study13,50013,5000 13,500 0 0 0OC Supportive Housing Monitoring Fee4,2504,250 0 0 0 4,250 0 0 0Soft Cost Contingency350,868350,8680 350,868 0 350,868 0350,868Predev. Loan Interest/Fees 61,50061,5000 61,500 0 0 61,500 061,500Construction Loan Interest1,776,3081,776,3080 957,733 0818,575 957,733 0 0957,7330 Construction Loan Interest - Tail226,157226,1570 0 0226,157 0 0 0 0 Accrued Interest - Seller Carryback Loan (SJCO)433,092433,0920 0 0433,092 0 0 0 0Accrued Interest - Cal HFA SNHP157,352157,3520 100,400 056,952 100,400 0100,400Title/Recording/Escrow - Construction80,00080,0000 80,000 0 80,000 0 080,000Title/Recording/Escrow - Permanent40,00040,0000 40,000 40,000Legal (Owner): Construction Closing80,00080,0000 80,000 0 80,000 0 080,000 Syndication - LP45,00045,000022,500 22,500 0Syndication Consulting93,50093,500093,500 0 0 2,500Audit/Cost Certification30,00030,0000 30,000 0TCAC Application/Res/Monitoring Fee89,47089,4700 89,470 20,500Marketing 200,000200,0000 200,000 0Furnishings Not in Contract324,000324,0000 324,000 0 324,000 0324,000Start-up /Lease-up Reserve15,00015,000015,000 0 0Capitalized Operating Reserve (4 mos.)204,000204,0000204,000 204,000Capitalized HCD Subsidy Transistion Reserve289,256289,2560289,256 289,256Developer Fee 2,500,0002,500,0000 2,500,0000 2,500,000 0 715,9172,500,000- COSTS OF ISSUANCE/FINANCING FEESBond Counsel 50,00050,000050,000 0 0 0 0 0 0Issuer Application Fee2,5002,500 0 1,600 0 900 0 0 0 1,600Issuer Fee - Upfront 31,10931,1090 19,910 011,199 0 0 019,910Issuer Fee - Annual During Const.17,92517,9250 11,472 06,453 0 0 011,472Construction Lender Origination Fee152,933152,9330 107,550 045,383 0 107,550 0107,550Construction Lender Expenses25,00025,0000 25,000 0 0 25,000 025,000Construction Lender Counsel75,00075,0000 75,000 0 0 75,000 075,000Trustee Fee During Construction4,0004,000 0 2,560 01,440 0 0 0 2,560CDLAC Fee 6,2746,274 0 4,015 02,259 0 0 0 4,015CDIAC Fee 4,4814,481 0 2,868 01,613 0 0 0 2,868Subtotal - Financing/Costs of Issuance369,222369,222050,000249,975069,2470207,5500 0249,9750 TOTAL DEVELOPMENT COSTS36,803,50236,803,5020674,25634,079,95601,679,570369,72028,146,0315,891,5001,272,17334,079,9560TDC Per Unit 736,070100.00%TDC Net of accrued interest:36,213,058TDC TCAC 36,635,00236,635,002 Villa St. Joseph
313

Developer Fee Calculation Version: 2.18

MAXIMUM DEVELOPER FEE CALCULATION
CONST. ACQ. TOTAL
Fee per Base TCAC Formula3,846,905883,7254,730,630
Percent of Total81.32% 18.68%100.00%
Max. Allowable Fee per TCAC (prorated)3,846,905883,7254,730,630 Less: Development Consulting0 0
Net Allowable3,846,905883,7254,730,630
Less: Owner Reduction 0 0 0
Net Allowable3,846,905883,7254,730,630
Maximum Base Developer Fee per TCAC 4,730,630
Maximum Developer Fee per HCD N/A
Maximum Developer Fee per Local N/A
Maximum Developer Fee per Owner 2,500,000
Maximum Developer Fee at Max Cash Fee
Most Restrictive Maximum Developer Fee: 2,500,000
Maximum Cash Fee per TCAC(Lesser of Calc. or Reservation Amount)2,500,000 Maximum Cash Fee per HCDNPLH guidelines 2,000,000
Maximum Cash Fee per Local N/A
Maximum Cash Fee per Owner N/A
Most Restrictive Maximum Cash Fee: 2,000,000

ACTUAL DEVELOPER FEE PAYMENT SCHEDULE

Amount% of Cash Fee% of Total Fee
Construction Close 715,917 40.00% 28.64% Completion 357,958 20.00% 14.32% Conversion 615,917 34.41% 24.64% Final LP Pay-in 1 100,000 5.59% 4.00% Total: Cash Fee 1,789,792
Plus: Deferred Developer Fee 710,208 28.41%
Plus: GP Capital 0 0.00%
Total Developer Fee 2,500,000
Villa St. Joseph
314

Unit Mix & Rental Income Version:2.18
UTILITY ALLOWANCES0BR1BR2BR3BR4BR5BRAVERAGE AFFORDABILITY FOR VSJ 64 74 103 82 - - LIHTC UNITS (% of Median)33.88% 0 - - - - - - 0 - - - - - - RENT LIMITS AS OF YEAR:2022

RESIDENTIAL INCOME
LIHTC - Tier 1VSJ TCAC20%AMI % of Units:36.73% Section 8SUBSIDIZED Unit TypeNumberUnit Floor Area
Actual Rent TCAC AMI %
Per Unit Monthly Gross Rent
Per Unit Regulatory Net Rent
Per Unit Actual Net Rent
Total Monthly Net Rent
Total Annual Net Rent
Number of Subsidized Units
Per Unit Net Subsidy Rents
Per Unit Subsidy Increment
Total Monthly Subsidy
Total Annual Subsidy
Total Annual Income
1BR 1850020.0% 508 434 4347,81293,744 181,8501,41625,488305,856399,600 TOTAL18 PSH- NPLH units 7,81293,744 18 25,488305,856399,600 LIHTC - Tier 2VSJ TCAC30%AMI % of Units:12.24% NOTSUBSIDIZED Unit TypeNumberUnit Floor Area
Actual Rent TCAC AMI %
Per Unit Monthly Gross Rent
Per Unit Regulatory Net Rent
Per Unit Actual Net Rent
Total Monthly Net Rent
Total Annual Net Rent
Number of Subsidized Units
Per Unit Net Subsidy Rents
Per Unit Subsidy Increment
Total Monthly Subsidy
Total Annual Subsidy
Total Annual Income
0BR 2 37530.0% 712 648 6481,29615,552 0 0 0 0 015,5521BR 4 50030.0% 762 688 6882,75233,024 0 0 0 0 033,024 TOTAL6 4,04848,576 0 0 048,576
LIHTC - Tier 3VSJ TCAC40%AMI % of Units:26.53% NOTSUBSIDIZED Unit TypeNumberUnit Floor Area
Actual Rent TCAC AMI %
Per Unit Monthly Gross Rent
Per Unit Regulatory Net Rent
Per Unit Actual Net Rent
Total Monthly Net Rent
Total Annual Net Rent
Number of Subsidized Units
Per Unit Net Subsidy Rents
Per Unit Subsidy Increment
Total Monthly Subsidy
Total Annual Subsidy
Total Annual Income
0BR 2 37540.0% 949 885 8851,77021,240 0 0 0 0 021,2401BR 1150040.0% 1,016942 94210,362124,344 0 0 0 0 0124,344 TOTAL13 12,132145,584 0 0 0145,584
LIHTC - Tier 4VSJ TCAC50%AMI % of Units:24.49% NOTSUBSIDIZED Unit TypeNumberUnit Floor Area
Actual Rent TCAC AMI %
Per Unit Monthly Gross Rent
Per Unit Regulatory Net Rent
Per Unit Actual Net Rent
Total Monthly Net Rent
Total Annual Net Rent
Number of Subsidized Units
Per Unit Net Subsidy Rents
Per Unit Subsidy Increment
Total Monthly Subsidy
Total Annual Subsidy
Total Annual Income
0BR 2 37550.0% 1,1861,1221,1222,24426,928 0 0 0 0 026,9281BR 1050050.0% 1,2701,1961,19611,960143,520 0 0 0 0 0143,520 TOTAL12 14,204170,448 0 0 0170,448
Staff Units - Site 1VSJ
Unit TypeNumberUnit Floor Area
Actual Rent TCAC AMI %
Per Unit Monthly Gross Rent
Per Unit Regulatory Net Rent
Per Unit Actual Net Rent
Total Monthly Net Rent
Total Annual Net Rent
2BR 1 8000.0% 0 0 0 0 0
TOTAL1 0 0

TOTAL RESIDENTIAL INCOME
Number
Total Monthly Net Rent
Total Annual Net Rent
Monthly Section 8 Income
Annual Section 8 IncomeMonthly NA IncomeAnnual NA Income Monthly Test C Income
Annual Test C Income
Monthly Test D Income
Annual Test D Income
Grand Total IncomeTotal Floor AreaLIHTC 49 38,196 458,352 25,488 305,856 0 0 0 0 0 0 764,208 23,750 Non-LIHTC 0 0 0 0 0 0 0 0 0 0 0 0 0 Staff Units 1 0 0 0 0 0 0 0 0 0 0 0 800 TOTAL 50 38,196 458,352 25,488 305,856 0 0 0 0 0 0 764,208 24,550

MISCELLANEOUS INCOME SUBSIDIZED UNIT MIX SUMMARY
Per Unit Per MonthMonthly TotalAnnual Total
Laundry / Vending 5.00 250 3,000 Units With Section 8
Units Without SubsidyOther 0.00 0 0 Unit Type Units With Units With Units With Total UnitsParking 0.00 0 0 0BR 0 0 0 0 6 61BR 18 0 0 0 25 43TOTAL 5.00 250 3,000 2BR 0 0 0 0 1 1TOTAL 18 0 0 0 32 50

SCATTERED SITE UNIT MIX SUMMARY
LIHTC Non-LIHTC STAFF UNITS
Unit TypeVSJ0 0 0 0 VSJ0 0 0 0 VSJ0 0 0 00BR6 0 0 0 0 0 0 0 0 0 0 0 0 0 01BR43 0 0 0 0 0 0 0 0 0 0 0 0 0 02BR0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 TOTAL49 0 0 0 0 0 0 0 0 0 1 0 0 0 0

TOTAL ALL TYPES
Unit Type VSJ 0 0 0 00BR 6 0 0 0 01BR 43 0 0 0 02BR 1 0 0 0 0 TOTAL50 0 0 0 0
Villa St. Joseph
315

Calculation of Tax Credits Version: 2.18

FEDERAL CALIFORNIA

CONST/ CONST/

ACQUISITIONREHAB TOTALACQUISITIONREHAB TOTAL

TOTAL ELIGIBLE COSTS 5,891,50028,146,03134,037,531 0 0 0 Less:

Voluntary Reduction for Tie-Breaker 0 0 0 0 0 0

ELIGIBLE BASIS 5,891,50028,146,03134,037,531 0 0 0
Threshold Basis Limit 49,868,829
TBL: Exclude GP Cap/DDF for 4%/State 0
REQUESTED UNADJUSTED ELIGIBLE BASIS (For Tiebreaker)5,891,50028,146,03134,037,531 0 0 0 HIGH COST ADJUSTMENT (Y or N)Y 100.0% 130.0% 100.0% 100.0% DDA 2021-2022
ADJUSTED ELIGIBLE BASIS 5,891,50036,589,84142,481,341 0 0 0 APPLICABLE FRACTION* 100.0% 100.0% 100.0% 100.0%

QUALIFIED CREDIT BASIS 5,891,50036,589,84142,481,341 0 0 0 CREDIT RATE (TCAC UNDERWRITING)State - Total 13.00% 13.00% Federal Annual/Yr 1-3 State4.00% 4.00% 4.00% 4.00%
Year 4 - State 1.00% 1.00%
MAX. POTENTIAL FEDERAL CREDIT (No Vol Basic Reduct/Actual Rate) Credit Rates 4.00% 4.00%
Potential Credit235,6601,463,5941,699,254
Credit Rate Locked? NO
MAX. CREDIT AMOUNT PER TCAC UNDERWRITING
Federal Annual/Yr 1State235,6601,463,5941,699,254 0 0 0 Yr 2 State 0 0 0
Yr 3 State 0 0 0
Yr 4 State 0 0 0
Total 0 0 0
Federal Annual/Total StateN/A N/A N/A N/A N/A N/A

MAXIMUM ALLOWABLE CREDITS (Lesser of above)
Federal Annual/Total State235,6601,463,5941,699,254 0

MAXIMUM ALLOWABLE - TEN YEAR TOTAL 16,992,536 0
Villa St. Joseph
316

Base Year Income & Expense Version: 2.18

INCOME
Scheduled Gross Income - Residential 458,352
Total Gross Subsidy Income - Section 8 305,856
Misc. Income 3,000
Vacancy Loss - Residential 6.84% (31,556)
Vacancy Loss - Section 8 6.84% (20,921)
EFFECTIVE GROSS INCOME 714,731

EXPENSES - RESIDENTIAL
Administrative
Advertising 2,016
Legal 2,000
Accounting/Audit 15,828
Security 0
Other: Misc. Admin 18,473

Total Administrative 38,317
Management Fee 41,160
Utilities
Gas 9,756
Electricity 14,400
Water/Sewer 18,000
Total Utilities 42,156
Payroll/Payroll Taxes
On-Site Manager/Office Admin 58,400
Maintenance Payroll 94,360
Payroll Taxes/Benefits 37,356
Total Payroll/Payroll Taxes 190,116
Insurance 68,304
Maintenance
Painting 6,192
Repairs 0
Trash Removal 17,112
Exterminating 6,582
Grounds 600
Supplies & Contracts 48,732
Total Maintenance 79,218
Other
Misc. Tax/License 1,500
Total Other 1,500
Resident Services
Tenant Services 91,692
Total Resident Services 91,692
Replacement Reserve 25,000
Real Estate Taxes 7,236
TOTAL EXPENSES - RESIDENTIAL 584,699
Per Unit Per Annum (incl. Reserves) 11,694
Per Unit Per Annum (w/o taxes/res/svc)) 9,215
TCAC Minimum (w/o taxes/res/svc) 4,700
NET AVAILABLE INCOME 130,032
Less: Mandatory Annual HCD Payment (Grossed Up for DSCR Factor) 1.15 (27,250) Less: Ground Lease - Minimum Payment (1)
Less: OCHCD Monitoring Fee (1,710)
ADJUSTED NET AVAILABLE INCOME: TOTAL 101,071
ADJUSTED NET AVAILABLE INCOME: NET OF OP SUBSIDY (183,864) Debt Service Coverage Ratio 1.15
AVAILABLE FOR DEBT SERVICE (NET OF OP SUBSIDY) (159,882) AVAILABLE FOR DEBT SERVICE (OP SUBSIDY OVERHANG) 247,770 NET AVAILABLE INCOME AFTER SENIOR DEBT SERVICE 101,071
Villa St. Joseph
317

Mortgage Calculation/Bond Ratios Version: 2.18

BOND / REHABILITATION RATIOS
Tax-Exempt Financing Ratio CDLAC Allocation Limit Effective Date Limits:6/9/20 Units Per-Unit LimitTotal Limit
Studio and SRO 6 522,000 3,132,000
One BR 43 544,000 23,392,000
Series A Bonds 0Two BR 1 580,500 580,500
Series B Bonds 0Three BR 0 638,500 0
Short Term Bonds (Construction Loan Portion)17,925,000Four BR or More 0 671,500 0 TOTAL TAX-EXEMPT FINANCING17,925,000
TOTAL27,104,500
TOTAL BASIS + LAND ALLOCATION34,079,956 Potential Bond Size17,925,000 Over/(Under)-9,179,500
Percent Tax-Exempt Financing 52.60%
Cushion to 50%: 885,022
Villa St. Joseph
318

Lease-Up / Placed-in-Service Schedule Version: 2.18

SCHEDULE
DatesMonths to MilestoneCumulative MonthsStart of ConstructionDecember 1, 20220 0Completion June 1, 202418 18100% OccupancyNovember 1, 20245 23Conversion April 1, 20255 28Form(s) 8609 October 1, 20256 34 LIHTC SCHEDULE LIHTC SCHEDULE -- 2/3 CREDITSOPERATIONS SCHEDULESINGLE BUILDING / MULTIPLE BUILDINGS - GROUP ASINGLE BLDG / MULTIPLE BLDGS - GROUP AYEAR1 1st Tax Credit Year:2024 1st Tax Credit Year (2/3 Units):2025 2024Total # Units:49 Completed Lease Up by MonthTotal QOTotal VacatedCumulativeCumulative MonthNo. UnitsPercent MonthNo. UnitsPercentMonthby Monthby MonthOccupancyOccupancy % Jan-250 0.0% Jan-24 0 0.0%Jan-24 0 0 0 0.00% Feb-250 0.0% Feb-24 0 0.0%Feb-24 0 0 0 0.00% Mar-250 0.0% Mar-24 0 0.0%Mar-24 0 0 0 0.00% Apr-250 0.0% Apr-24 0 0.0%Apr-24 0 0 0 0.00% May-250 0.0% May-24 0 0.0%May-24 0 0 0 0.00% Jun-250 0.0% Jun-24 1020.0%Jun-24 9 0 9 18.37% Jul-250 0.0% Jul-24 1020.0%Jul-24 10 0 19 38.78% Aug-250 0.0% Aug-24 1020.0%Aug-24 10 0 29 59.18% Sep-250 0.0% Sep-24 1020.0%Sep-24 10 0 39 79.59% Oct-250 0.0% Oct-24 1020.0%Oct-24 10 0 49100.00% Nov-250 0.0% Nov-24 0 0.0%Nov-24 0 0 49100.00% Dec-250 0.0% Dec-24 0 0.0%Dec-24 0 0 49100.00% Total0 0.0% Total 50100.0% 1st Year Occupancy: 202441.33% Total Avg % Qual. Occ.0.0% Total % Operating in First Year41.67% MULTIPLE BUILDINGS - GROUP B MULTIPLE BUILDINGS - GROUP BYEAR 2 (cumulative) 2025 1st Tax Credit Year:2025 1st Tax Credit Year (2/3 Units):2026Total # Units: 0Total QOTotal VacatedCumulativeCumulative MonthNo. UnitsPercent MonthNo. UnitsPercentMonthby Monthby MonthOccupancyOccupancy % Jan-260 0.0% Jan-25 50100.0%Jan-25 0 0 0 0.00% Feb-260 0.0% Feb-25 0 0.0%Feb-25 0 0 0 0.00% Mar-260 0.0% Mar-25 0 0.0%Mar-25 0 0 0 0.00% Apr-260 0.0% Apr-25 0 0.0%Apr-25 0 0 0 0.00% May-260 0.0% May-25 0 0.0%May-25 0 0 0 0.00% Jun-260 0.0% Jun-25 0 0.0%Jun-25 0 0 0 0.00% Jul-260 0.0% Jul-25 0 0.0%Jul-25 0 0 0 0.00% Aug-260 0.0% Aug-25 0 0.0%Aug-25 0 0 0 0.00% Sep-260 0.0% Sep-25 0 0.0%Sep-25 0 0 0 0.00% Oct-260 0.0% Oct-25 0 0.0%Oct-25 0 0 0 0.00% Nov-260 0.0% Nov-25 0 0.0%Nov-25 0 0 0 0.00% Dec-260 0.0% Dec-25 0 0.0%Dec-25 0 0 0 0.00% Total0 0.0% Total 50100.0% 1st Year Occupancy: 20250.00% Total Avg % Qual. Occ.0.0% Total % Operating in 2nd Year100.0% PIS SCHEDULE FOR ACQ BASIS DEPRECIATIONPIS SCHEDULE FOR REHAB/NC BASIS DEPRECIATIONPIS SCHEDULE FOR SITEWORK/PERS. PROP. DEPRECIATIONYEAR1 YEAR 1 YEAR 1Mid-Month Convention2024 Mid-Month Convention 2024 Mid-Year Convention 2024 Bldg. PIS by Month Bldg. PIS by Month Bldg. PIS by MonthMonthNo. UnitsDep. Percent MonthBuilding No.No. UnitsPercent MonthBuilding No.No. UnitsPercentJan-24 0 0.0% Jan-24 0 0 0.0% Jan-24 0 0 0.0%Feb-24 0 0.0% Feb-24 0 0 0.0% Feb-24 0 0 0.0%Mar-24 0 0.0% Mar-24 0 0 0.0% Mar-24 0 0 0.0%Apr-24 0 0.0% Apr-24 0 0 0.0% Apr-24 0 0 0.0%May-24 0 0.0% May-24 0 0 0.0% May-24 0 0 0.0%Jun-24 10 0.8% Jun-24 0 100.8% Jun-24 0 10 0.0%Jul-24 20 2.5% Jul-24 1 202.5% Jul-24 1 10 8.3%Aug-24 30 4.2% Aug-24 0 304.2% Aug-24 0 10 8.3%Sep-24 40 5.8% Sep-24 0 405.8% Sep-24 0 10 8.3%Oct-24 50 7.5% Oct-24 0 507.5% Oct-24 0 10 8.3%Nov-24 50 8.3% Nov-24 0 508.3% Nov-24 0 0 8.3%Dec-24 50 8.3% Dec-24 0 508.3% Dec-24 0 0 8.3%TOTAL 50 37.5% TOTAL 5037.5% TOTAL 5050.0% Total Avg % PIS Y1 37.5% Total Avg % PIS Y1 37.5% Total Avg % PIS Y1 50.0%YEAR 2 (cumulative) YEAR 2 (cumulative) YEAR 2 (non-cumulative) Jan-25 50 8.3% Jan-25 0 508.3% Jan-25 0 0 8.3%Feb-25 50 8.3% Feb-25 0 508.3% Feb-25 0 0 8.3%Mar-25 50 8.3% Mar-25 0 508.3% Mar-25 0 0 8.3%Apr-25 50 8.3% Apr-25 0 508.3% Apr-25 0 0 8.3%May-25 50 8.3% May-25 0 508.3% May-25 0 0 8.3%Jun-25 50 8.3% Jun-25 0 508.3% Jun-25 0 0 8.3%Jul-25 50 8.3% Jul-25 0 508.3% Jul-25 0 0 8.3%Aug-25 50 8.3% Aug-25 0 508.3% Aug-25 0 0 8.3%Sep-25 50 8.3% Sep-25 0 508.3% Sep-25 0 0 8.3%Oct-25 50 8.3% Oct-25 0 508.3% Oct-25 0 0 8.3%Nov-25 50 8.3% Nov-25 0 508.3% Nov-25 0 0 8.3%Dec-25 50 8.3% Dec-25 0 508.3% Dec-25 0 0 8.3%TOTAL 50 100.0% TOTAL 50100.0% TOTAL 0100.0% Total Avg % PIS Y2 100.0% Total Avg % PIS Y2 100.0% Total Avg % PIS Y2 100.0% Villa St. Joseph
319

TCAC Calculations & Scoring Version: 2.18

THRESHOLD BASIS LIMIT
County: Orange
9% or 4% credits: 4%
Year: 2022
Base Limits for Geographic RegionThreshold Basis Limit for This Project Per Unit
Unit Type 9% 4% Unit Type # Units Basis Limit Total
0 BR 308,882 308,882 0 BR 6 308,882 1,853,292
1 BR 356,138 356,138 1 BR 43 356,138 15,313,934
2 BR 429,600 429,600 2 BR 1 429,600 429,600
50 17,596,826
Energy/Resource Efficiency BoostsAdditional Basis Adjustments Boost for Prevailing Wage 20.0%
Renewables (50% tot./90% area)0%Boost for Project Labor Agreement 0.0% Renewables (75% CA/90% area)0%Boost for Parking beneath Units 0.0% Title 24 + 15% 0%Boost for Childcare 0.0%
Post-rehab improvement > 80% 0%Boost for 100% Special Needs 0.0% Greywater landscaping 0%Boost for elevator service 10.0% Community gardens > 60 s.f. 0%Subtotal Boost 30.0% 5,279,048 Natural flooring kitchens 0%Boost for Energy / Resource Efficiency 0.0% 0 Natural flooring common area 0%Toxic/Seismic Abatement Costs 0.0% 0 EPA Indoor Air Plus Program met0%Local Development Impact Fees 1,125,621 Type I Construction N 15% 0
Type III Construction N 10% 0
High Opportunity Area 0% 0
BONDS: Boost for units <= 50% AMI (excl. CA credit project)1.0% 8,974,381 Subtotal Efficiency (Max 10%) 0%BONDS: Boost for units <= 35% AMI (excl. CA credit project)2.0% 16,892,953 Total Threshold Basis Limit 49,868,829
Potential Eligible Basis 34,037,531
Eligible Basis Surplus / Deficit 15,831,298
Villa St. Joseph
320

15-Year Cash Flow Version:2.18
Assumptions Rent Increase: Residential Tenant Rents2.00% Rent Increase - Section 82.00% Perm Loan - % Debt Svc Yr -10.0% Rent Increase: Commercial Rents2.00% Rent Increase - NA2.00% Perm Loan - % Debt Svc Yr 00.0% Expenses Increase: 3.00% Rent Increase - Test C2.00% Perm Loan - % Debt Svc Yr 10.0% Reserve Increase: 0.00% Rent Increase - Test D2.00% Perm Loan - % Debt Svc Yr 275.0%Perm Loan - % Debt Svc Yr 3100.0% Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 20222023 2024 2025 202620272028202920302031203220332034203520362037203820392040Aggregrate Annual Rent Increase #DIV/0!142.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%2.00%GROSS POTENTIAL INCOME - RESIDENTIAL 0 0190,980462,172471,415480,843490,460500,269510,275520,480530,890541,508552,338563,385574,652586,145597,868609,826622,022Incremental Income: Section 8 0 0127,440308,405314,573320,864327,282333,827340,504347,314354,260361,345368,572375,944383,463391,132398,954406,934415,072Misc. Income 0 0 1,2503,0253,0863,1473,2103,2743,3403,4073,4753,5443,6153,6873,7613,8363,9133,9914,071Vacancy Loss - Residential 6.8% 0 0 (13,149)(31,819)(32,456)(33,105)(33,767)(34,442)(35,131)(35,834)(36,551)(37,282)(38,027)(38,788)(39,563)(40,355)(41,162)(41,985)(42,825)Vacancy Loss - Section 8 6.8% 0 0 (8,717)(21,095)(21,517)(21,947)(22,386)(22,834)(23,290)(23,756)(24,231)(24,716)(25,210)(25,715)(26,229)(26,753)(27,288)(27,834)(28,391) GROSS EFFECTIVE INCOME 0 0297,805720,687735,101749,803764,799780,095795,697811,611827,843844,400861,288878,514896,084914,005932,286950,931969,950 Operating Expenses w/ Standard Inflator3.0% 0 0191,988466,531480,527494,942509,791525,084540,837557,062573,774590,987608,717626,978645,788665,161685,116705,669726,840Operating Expenses w/ Alternate Inflators:Tenant Services2.5% 0 0 38,20592,64794,96397,33799,771102,265104,822107,442110,128112,882115,704118,596121,561124,600127,715130,908134,181Real Estate Taxes2.0% 0 0 3,0157,2967,4427,5917,7437,8988,0568,2178,3818,5498,7208,8949,0729,2539,4399,6279,820 TOTAL EXPENSES 0 0233,208566,474582,932599,871617,304635,247653,714672,721692,283712,417733,140754,468776,421799,015822,270846,205870,840 NET OPERATING INCOME 0 0 64,597154,213152,169149,932147,495144,848141,982138,890135,560131,982128,148124,045119,663114,991110,016104,72799,110 REPLACEMENT RESERVE 25,000 0 0 10,41725,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,000Mandatory Annual HCD Payment 0.42% 0 0 0 17,77123,69523,69523,69523,69523,69523,69523,69523,69523,69523,69523,69523,69523,69523,69523,695Ground Lease - Minimum Payment 1 0 0 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1OCHCD Monitoring Fee 1,710 0 0 1,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,710 NET REMAINING INCOME 0 0 52,470109,731101,76299,52697,08894,44191,57688,48385,15381,57677,74273,63969,25764,58559,61054,32048,704 NET CASH FLOW 0 0 52,470109,731101,76299,52697,08894,44191,57688,48385,15381,57677,74273,63969,25764,58559,61054,32048,704 Expense Coverage Ratio (No Debt) N/A N/A 1.28 1.27 1.26 1.25 1.24 1.23 1.22 1.21 1.20 1.19 1.17 1.16 1.15 1.14 1.13 1.12 1.11

DISTRIBUTION OF CASH FLOW
LP AMF 1 Annual Amt:5,000 0 0 2,0835,1505,3055,4645,6285,7965,9706,1496,3346,5246,7206,9217,1297,3437,5637,7908,024Inflator:3.00%DDF Annual Amt:0 0 0 0104,58196,45894,06291,46188,64585,60682,33467,061 0 0 0 0 0 0 0 0DDF Note Interest Rate:0.00%GP PM Fee Annual Amt:25,000 0 0 10,417 0 0 0 0 0 0 0 11,75875,05271,02266,71862,12857,24252,04746,53040,680Inflator:3.00%Residual Receipts LoansTotal %100.00%Note: Seller Carryback Loan is paid from GP's 50% share of Residual ReceiptsSeller Carryback Loan (SJCO) 50.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Cal HFA SNHP 13.84% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0County of Orange HOME Loan 3.82% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0HCD - NPLH Non-Competitive 7.48% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0HCD - NPLH Competitive 13.63% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0County of Orange MHSA Loan 5.24% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0City of Orange HOME Loan 2.44% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0City of Orange LMIHA Loan 2.15% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0City of Orange In-Lieu Fees Loan 1.40% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 General Partner 0.01% 0 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Limited Partner 99.99% 0 0 39,966 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Villa St. Joseph
321
Villa St. Joseph Page X-6
First Year Full Cash Flow Version:2.18
REVENUE MULTIPLIERYEAR 1YEAR 2YEAR 3YEAR 4YEAR 5YEAR 6YEAR 7YEAR 8YEAR 9YEAR 10YEAR 11YEAR 12YEAR 13YEAR 14YEAR 15Gross Rent 1.020 $458,352$467,519$476,869$486,407$496,135$506,058$516,179$526,502$537,032$547,773$558,729$569,903$581,301$592,927$604,786Less Vacancy 6.84% -31,351-31,978-32,618-33,270-33,936-34,614-35,307-36,013-36,733-37,468-38,217-38,981-39,761-40,556-41,367Rental Subsidy 1.020 305,856$311,973$318,213$324,577$331,068$337,690$344,444$351,332$358,359$365,526$372,837$380,293$387,899$395,657$403,570Less Vacancy 6.84% -20,921-21,339-21,766-22,201-22,645-23,098-23,560-24,031-24,512-25,002-25,502-26,012-26,532-27,063-27,604Miscellaneous Income1.020 3,000 $3,060 $3,121 $3,184 $3,247 $3,312 $3,378 $3,446 $3,515 $3,585 $3,657 $3,730 $3,805 $3,881 $3,958Less Vacancy 6.84% -205 -209 -213 -218 -222 -227 -231 -236 -240 -245 -250 -255 -260 -265 -271Total Revenue $714,731$729,026$743,606$758,478$773,648$789,121$804,903$821,001$837,421$854,170$871,253$888,678$906,452$924,581$943,072 EXPENSESOperating Expenses:1.030
Administrative $38,317$39,467$40,651$41,870$43,126$44,420$45,753$47,125$48,539$49,995$51,495$53,040$54,631$56,270$57,958Management 41,160$42,395$43,667$44,977$46,326$47,716$49,147$50,622$52,140$53,704$55,316$56,975$58,684$60,445$62,258Utilities 42,156$43,421$44,723$46,065$47,447$48,870$50,336$51,847$53,402$55,004$56,654$58,354$60,104$61,908$63,765Payroll & Payroll Taxes 190,116$195,819$201,694$207,745$213,977$220,397$227,008$233,819$240,833$248,058$255,500$263,165$271,060$279,192$287,568Insurance 68,304$70,353$72,464$74,638$76,877$79,183$81,559$84,005$86,525$89,121$91,795$94,549$97,385$100,307$103,316Maintenance 79,218$81,595$84,042$86,564$89,161$91,835$94,590$97,428$100,351$103,362$106,462$109,656$112,946$116,334$119,824Other Operating Expenses (specify):1,500 $1,545 $1,591 $1,639 $1,688 $1,739 $1,791 $1,845 $1,900 $1,957 $2,016 $2,076 $2,139 $2,203 $2,269Total Operating Expenses $460,771$474,594$488,832$503,497$518,602$534,160$550,185$566,690$583,691$601,202$619,238$637,815$656,949$676,658$696,957 Service Amenities 1.025 91,692 93,984 96,334 98,742101,211103,741106,335108,993111,718114,511117,374120,308123,316126,398129,558Replacement Reserve 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000Real Estate Taxes 1.020 7,236 7,381 7,528 7,679 7,832 7,989 8,149 8,312 8,478 8,648 8,821 8,997 9,177 9,361 9,548Other (Specify): Ground Lease Payment1.000 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1Other (Specify): OC Monitoring1.000 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 1,710 Total Expenses $586,410$602,670$619,405$636,629$654,356$672,601$691,379$710,706$730,598$751,071$772,143$793,831$816,153$839,128$862,775 Cash Flow Prior to Debt Service$128,321$126,355$124,201$121,849$119,292$116,520$113,524$110,295$106,823$103,099$99,110$94,847$90,299$85,453$80,298 MUST PAY DEBT SERVICEMandatory Annual HCD Payment23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695 23,695Total Debt Service $23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695$23,695 Cash Flow After Debt Service$104,626$102,660$100,506$98,154$95,596$92,824$89,829$86,600$83,128$79,403$75,415$71,152$66,604$61,758$56,602HCD Transition Reserve Sizing289,255Percent of Gross Revenue 13.64%13.12%12.59%12.06%11.51%10.96%10.40% 9.83% 9.25% 8.66% 8.06% 7.46% 6.85% 6.22% 5.59%25% Debt Service Test 441.55%433.25%424.16%414.23%403.44%391.74%379.10%365.47%350.82%335.10%318.27%300.28%281.08%260.63%238.88%Debt Coverage Ratio 5.415 5.333 5.242 5.142 5.034 4.917 4.791 4.655 4.508 4.351 4.183 4.003 3.811 3.606 3.389Income/Expense Ratio 1.17 1.16 1.16 1.15 1.14 1.13 1.13 1.12 1.11 1.10 1.09 1.09 1.08 1.07 1.06 322

Schedule of Outstanding Debt and Reserves - Book Basis Version:2.18 Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 19042022202320242025202620272028202920302031203220332034203520362037203820392040 Seller Carryback Loan (SJCO)Beginning Balance 5,705,000 5,705,0005,719,9285,899,5346,084,7796,275,8416,472,9036,676,1526,885,7837,101,9977,324,9997,555,0047,792,2318,036,9078,289,2668,549,5498,818,0059,094,8909,380,4709,675,017Interest Accrued @ 3.140% 14,928179,606185,245191,062197,061203,249209,631216,214223,003230,005237,227244,676252,359260,283268,456276,885285,580294,547303,796Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance 5,719,9285,899,5346,084,7796,275,8416,472,9036,676,1526,885,7837,101,9977,324,9997,555,0047,792,2318,036,9078,289,2668,549,5498,818,0059,094,8909,380,4709,675,0179,978,812 Cal HFA SNHP PERM SOURCE ONLY?:NBeginning Balance 3,696,893 3,696,8933,706,1353,817,0423,927,9494,038,8564,149,7624,260,6694,371,5764,482,4834,593,3904,704,2964,815,2034,926,1105,037,0175,147,9245,258,8305,369,7375,480,6445,591,551Interest Accrued @ 3.000% 9,242110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907110,907Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance CONSTRUCT AOB:100% 3,706,1353,817,0423,927,9494,038,8564,149,7624,260,6694,371,5764,482,4834,593,3904,704,2964,815,2034,926,1105,037,0175,147,9245,258,8305,369,7375,480,6445,591,5515,702,457 County of Orange HOME LoanPERM SOURCE ONLY?YBeginning Balance 1,020,600 0 0 0 01,043,5641,074,1821,104,8001,135,4181,166,0361,196,6541,227,2721,257,8901,288,5081,319,1261,349,7441,380,3621,410,9801,441,5981,472,216Interest Accrued @ 3.000% 0 0 0 22,96430,61830,61830,61830,61830,61830,61830,61830,61830,61830,61830,61830,61830,61830,61830,618Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:0% 0 0 01,043,5641,074,1821,104,8001,135,4181,166,0361,196,6541,227,2721,257,8901,288,5081,319,1261,349,7441,380,3621,410,9801,441,5981,472,2161,502,834 HCD - NPLH Non-CompetitivePERM SOURCE ONLY?YBeginning Balance 2,000,000 0 0 0 02,038,7002,090,3002,141,9002,193,5002,245,1002,296,7002,348,3002,399,9002,451,5002,503,1002,554,7002,606,3002,657,9002,709,5002,761,100Interest Accrued @ 3.000% 0 0 0 45,00060,00060,00060,00060,00060,00060,00060,00060,00060,00060,00060,00060,00060,00060,00060,000Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.42% 0 0 0 (6,300)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)Ending Balance CONSTRUCT AOB:0% 0 0 02,038,7002,090,3002,141,9002,193,5002,245,1002,296,7002,348,3002,399,9002,451,5002,503,1002,554,7002,606,3002,657,9002,709,5002,761,1002,812,700 HCD - NPLH CompetitivePERM SOURCE ONLY?YBeginning Balance 3,641,722 0 0 0 03,712,1893,806,1463,900,1023,994,0594,088,0154,181,9714,275,9284,369,8844,463,8414,557,7974,651,7544,745,7104,839,6664,933,6235,027,579Interest Accrued @ 3.000% 0 0 0 81,939109,252109,252109,252109,252109,252109,252109,252109,252109,252109,252109,252109,252109,252109,252109,252Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.42% 0 0 0 (11,471)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)Ending Balance CONSTRUCT AOB:0% 0 0 03,712,1893,806,1463,900,1023,994,0594,088,0154,181,9714,275,9284,369,8844,463,8414,557,7974,651,7544,745,7104,839,6664,933,6235,027,5795,121,536 County of Orange MHSA LoanPERM SOURCE ONLY?YBeginning Balance 1,400,000 0 0 0 01,431,5001,473,5001,515,5001,557,5001,599,5001,641,5001,683,5001,725,5001,767,5001,809,5001,851,5001,893,5001,935,5001,977,5002,019,500Interest Accrued @ 3.000% 0 0 0 31,50042,00042,00042,00042,00042,00042,00042,00042,00042,00042,00042,00042,00042,00042,00042,000Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:100% 0 0 01,431,5001,473,5001,515,5001,557,5001,599,5001,641,5001,683,5001,725,5001,767,5001,809,5001,851,5001,893,5001,935,5001,977,5002,019,5002,061,500 City of Orange HOME LoanPERM SOURCE ONLY?YBeginning Balance 651,244 0 0 0 0 665,897685,434704,972724,509744,046763,584783,121802,658822,196841,733861,270880,808900,345919,882939,419Interest Accrued @ 3.000% 0 0 0 14,65319,53719,53719,53719,53719,53719,53719,53719,53719,53719,53719,53719,53719,53719,53719,537Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:65% 0 0 0 665,897685,434704,972724,509744,046763,584783,121802,658822,196841,733861,270880,808900,345919,882939,419958,957 City of Orange LMIHA LoanPERM SOURCE ONLY?YBeginning Balance 576,000 0 0 0 0 588,960606,240623,520640,800658,080675,360692,640709,920727,200744,480761,760779,040796,320813,600830,880Interest Accrued @ 3.000% 0 0 0 12,96017,28017,28017,28017,28017,28017,28017,28017,28017,28017,28017,28017,28017,28017,28017,280Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:65% 0 0 0 588,960606,240623,520640,800658,080675,360692,640709,920727,200744,480761,760779,040796,320813,600830,880848,160 City of Orange In-Lieu Fees LoanPERM SOURCE ONLY?YBeginning Balance 372,756 0 0 0 0 381,143392,326403,508414,691425,874437,056448,239459,422470,604481,787492,970504,152515,335526,518537,701Interest Accrued @ 3.000% 0 0 0 8,38711,18311,18311,18311,18311,18311,18311,18311,18311,18311,18311,18311,18311,18311,18311,183Residual Receipts PaymentSIMPLE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:65% 0 0 0 381,143392,326403,508414,691425,874437,056448,239459,422470,604481,787492,970504,152515,335526,518537,701548,883 Villa St. Joseph
323

Schedule of Outstanding Debt and Reserves - Book Basis Version:2.18 Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 19042022202320242025202620272028202920302031203220332034203520362037203820392040 Villa St. Joseph
TOTAL OUTSTANDING DEBT (BOOK BASIS) 9,426,0639,716,57610,012,72820,176,65020,750,79221,331,12321,917,83522,511,13023,111,21423,718,30024,332,60824,954,36625,583,80626,221,17026,866,70727,520,67428,183,33428,854,96229,535,839 LP AMF 1 Accruals 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0DDF Accruals 0 0 0 605,627509,169415,107323,647235,001149,39567,061 0 0 0 0 0 0 0 0 0GP PM FEE Accruals 0 0 0 25,75052,27379,591107,728136,710166,562197,308217,220174,787137,363105,25178,76758,23844,00636,42535,862 TOTAL OUTSTANDING DEBT+ACCRUALS (BOOK BASIS) 9,426,0639,716,57610,012,72820,808,02721,312,23421,825,82122,349,21022,882,84223,427,17123,982,67024,549,82825,129,15225,721,16826,326,42126,945,47427,578,91228,227,34028,891,38729,571,701

RESERVE BALANCES
Capitalized Replacement ReserveDeed-Secured?YPrevious Balance 0 0 0 10,41735,62561,33887,564114,316141,602169,434197,823226,779256,315286,441317,170348,513380,483413,093446,355Deposit to Reserve 0 0 10,41725,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,000Interest on Reserve 2.0% 0 0 0 208 713 1,2271,7512,2862,8323,3893,9564,5365,1265,7296,3436,9707,6108,2628,927Withdrawal from Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance 0 0 0 10,41735,62561,33887,564114,316141,602169,434197,823226,779256,315286,441317,170348,513380,483413,093446,355480,282 Capitalized Operating Reserve (4 mos.)Deed-Secured?YPrevious Balance 0 0 0 204,000208,080212,242216,486220,816225,232229,737234,332239,019243,799248,675253,648258,721263,896269,174274,557Deposit to Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Interest on Reserve 2.0% 0 0 0 4,0804,1624,2454,3304,4164,5054,5954,6874,7804,8764,9735,0735,1745,2785,3835,491Withdrawal from Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance 204,000 0 0 0 208,080212,242216,486220,816225,232229,737234,332239,019243,799248,675253,648258,721263,896269,174274,557280,048 Capitalized HCD Subsidy Transistion ReserveDeed-Secured?YPrevious Balance 0 0 0 289,256295,041300,942306,961313,100319,362325,749332,264338,910345,688352,601359,653366,847374,183381,667389,300Deposit to Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Interest on Reserve 2.0% 0 0 0 5,7855,9016,0196,1396,2626,3876,5156,6456,7786,9147,0527,1937,3377,4847,6337,786Withdrawal from Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance 289,256 0 0 0 295,041300,942306,961313,100319,362325,749332,264338,910345,688352,601359,653366,847374,183381,667389,300397,087 324

Schedule of Outstanding Debt - Tax Basis Version:2.18
Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 0 2022 202320242025202620272028202920302031203220332034203520362037203820392040 Seller Carryback Loan (SJCO)Beginning Balance 5,705,000 5,705,0005,719,9285,899,5346,084,7796,275,8416,472,9036,676,1526,885,7837,101,9977,324,9997,555,0047,792,2318,036,9078,289,2668,549,5498,818,0059,094,8909,380,4709,675,017Interest Accrued @ 3.140% 14,928179,606185,245191,062197,061203,249209,631216,214223,003230,005237,227244,676252,359260,283268,456276,885285,580294,547303,796Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment- 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance 5,719,9285,899,5346,084,7796,275,8416,472,9036,676,1526,885,7837,101,9977,324,9997,555,0047,792,2318,036,9078,289,2668,549,5498,818,0059,094,8909,380,4709,675,0179,978,812 Cal HFA SNHP PERM SOURCE ONLY?:NBeginning Balance 3,696,893 3,696,8933,702,4013,768,5893,835,9613,904,5373,974,3394,045,3894,117,7094,191,3224,266,2514,342,5204,420,1524,499,1724,579,6044,661,4754,744,8094,829,6334,915,9735,003,857Interest Accrued @ 1.788% 5,50866,18867,37268,57669,80271,05072,32073,61374,92976,26977,63279,02080,43381,87083,33484,82486,34087,88489,455Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance CONSTRUCT AOB:100% 3,702,4013,768,5893,835,9613,904,5373,974,3394,045,3894,117,7094,191,3224,266,2514,342,5204,420,1524,499,1724,579,6044,661,4754,744,8094,829,6334,915,9735,003,8575,093,311 County of Orange HOME LoanPERM SOURCE ONLY?YBeginning Balance 1,020,600 0 0 0 01,034,2841,052,7741,071,5951,090,7521,110,2511,130,1001,150,3031,170,8671,191,7991,213,1051,234,7921,256,8661,279,3351,302,2061,325,486Interest Accrued @ 1.788% 0 0 0 13,68418,49018,82119,15719,50019,84820,20320,56420,93221,30621,68722,07522,46922,87123,28023,696Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:0% 0 0 01,034,2841,052,7741,071,5951,090,7521,110,2511,130,1001,150,3031,170,8671,191,7991,213,1051,234,7921,256,8661,279,3351,302,2061,325,4861,349,182 HCD - NPLH Non-CompetitivePERM SOURCE ONLY?YBeginning Balance 2,000,000 0 0 0 02,022,2502,052,3412,083,0052,114,2522,146,0942,178,5422,211,6072,245,3022,279,6392,314,6282,350,2842,386,6192,423,6452,461,3752,499,824Interest Accrued @ 1.903% 0 0 0 28,55038,49139,06439,64740,24240,84841,46642,09542,73643,39044,05644,73445,42646,13146,84947,581Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.42% 0 0 0 (6,300)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)(8,400)Ending Balance CONSTRUCT AOB:0% 0 0 02,022,2502,052,3412,083,0052,114,2522,146,0942,178,5422,211,6072,245,3022,279,6392,314,6282,350,2842,386,6192,423,6452,461,3752,499,8242,539,005 HCD - NPLH CompetitivePERM SOURCE ONLY?YBeginning Balance 3,641,722 0 0 0 03,682,2373,737,0283,792,8623,849,7593,907,7393,966,8224,027,0304,088,3834,150,9054,214,6174,279,5414,345,7014,413,1204,481,8234,551,833Interest Accrued @ 1.903% 0 0 0 51,98670,08671,12972,19273,27574,37875,50376,64977,81779,00780,21981,45582,71483,99885,30586,638Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.42% 0 0 0 (11,471)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)(15,295)Ending Balance CONSTRUCT AOB:0% 0 0 03,682,2373,737,0283,792,8623,849,7593,907,7393,966,8224,027,0304,088,3834,150,9054,214,6174,279,5414,345,7014,413,1204,481,8234,551,8334,623,175 County of Orange MHSA LoanPERM SOURCE ONLY?YBeginning Balance 1,400,000 0 0 0 01,418,7711,444,1351,469,9521,496,2301,522,9791,550,2051,577,9191,606,1271,634,8401,664,0671,693,8161,724,0961,754,9181,786,2911,818,225Interest Accrued @ 1.788% 0 0 0 18,77125,36425,81726,27926,74827,22727,71328,20928,71329,22629,74930,28130,82231,37331,93432,505Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:100% 0 0 01,418,7711,444,1351,469,9521,496,2301,522,9791,550,2051,577,9191,606,1271,634,8401,664,0671,693,8161,724,0961,754,9181,786,2911,818,2251,850,730 City of Orange HOME LoanPERM SOURCE ONLY?YBeginning Balance 651,244 0 0 0 0659,976671,774683,784696,008708,451721,116734,007747,129760,486774,081787,919802,005816,343830,937845,792Interest Accrued @ 1.788% 0 0 0 8,73211,79912,00912,22412,44312,66512,89213,12213,35713,59513,83814,08614,33814,59414,85515,120Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:65% 0 0 0659,976671,774683,784696,008708,451721,116734,007747,129760,486774,081787,919802,005816,343830,937845,792860,912 City of Orange LMIHA LoanPERM SOURCE ONLY?YBeginning Balance 576,000 0 0 0 0583,723594,158604,780615,592626,597637,799649,201660,807672,620684,645696,884709,342722,023734,931748,070Interest Accrued @ 1.788% 0 0 0 7,72310,43510,62210,81211,00511,20211,40211,60611,81312,02512,24012,45812,68112,90813,13913,373Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:65% 0 0 0583,723594,158604,780615,592626,597637,799649,201660,807672,620684,645696,884709,342722,023734,931748,070761,443 City of Orange In-Lieu Fees LoanPERM SOURCE ONLY?YBeginning Balance 372,756 0 0 0 0381,143392,577404,355416,485428,980441,849455,105468,758482,821497,305512,224527,591543,419559,721576,513Interest Accrued @ 3.000% 0 0 0 8,38711,43411,77712,13112,49512,86913,25513,65314,06314,48514,91915,36715,82816,30316,79217,295Residual Receipts PaymentCOMPOUND 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Mandatory Minimum Payment0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Ending Balance CONSTRUCT AOB:65% 0 0 0381,143392,577404,355416,485428,980441,849455,105468,758482,821497,305512,224527,591543,419559,721576,513593,808 Villa St. Joseph
325

Schedule of Outstanding Debt - Tax Basis Version:2.18
Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 0 2022 202320242025202620272028202920302031203220332034203520362037203820392040 Villa St. Joseph
TOTAL OUTSTANDING DEBT (TAX BASIS)9,422,3299,668,1239,920,74019,962,76320,392,03020,831,87321,282,57021,744,40922,217,68322,702,69523,199,75723,709,18824,231,31824,766,48425,315,03425,877,32626,453,72827,044,61627,650,379 LP AMF 1 Accruals 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0DDF Accruals 0 0 0605,627509,169415,107323,647235,001149,39567,061 0 0 0 0 0 0 0 0 0GP PM FEE Accruals 0 0 0 25,75052,27379,591107,728136,710166,562197,308217,220174,787137,363105,25178,76758,23844,00636,42535,862 TOTAL OUTSTANDING DEBT+ACCRUALS (TAX BASIS)9,422,3299,668,1239,920,74020,594,14020,953,47221,326,57121,713,94522,116,12022,533,64022,967,06523,416,97623,883,97524,368,68024,871,73525,393,80125,935,56526,497,73427,081,04127,686,242 326

Net Cash Flow Fee Accruals Version:2.18
Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 1904 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 LP AMF 1
Beginning Accrual Balance - - - - - - - - - - - - - - - - - - - Current Year LP AMF 1 - - 2,083 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 6,720 6,921 7,129 7,343 7,563 7,790 8,024 Total Payment - - (2,083) (5,150) (5,305) (5,464) (5,628) (5,796) (5,970) (6,149) (6,334) (6,524) (6,720) (6,921) (7,129) (7,343) (7,563) (7,790) (8,024) Ending Accrual Balance - - - - - - - - - - - - - - - - - - - Inflator:Potential LP AMF 1:5,0003.00% 0 0 2,083 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 6,720 6,921 7,129 7,343 7,563 7,790 8,024 DDF Beginning Accrual Balance - - - 710,208 605,627 509,169 415,107 323,647 235,001 149,395 67,061 - - - - - - - - Current Year DDF Interest - - - - - - - - - - - - - - - - - - - Total Payment - - - (104,581) (96,458) (94,062) (91,461) (88,645) (85,606) (82,334) (67,061) - - - - - - - - Ending Accrual Balance - - - 605,627 509,169 415,107 323,647 235,001 149,395 67,061 - - - - - - - - - Interest Rate:Potential DDF: 0 0.00% 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 GP PM FEE Beginning Accrual Balance - - - - 25,750 52,273 79,591 107,728 136,710 166,562 197,308 217,220 174,787 137,363 105,251 78,767 58,238 44,006 36,425 Current Year GP PM Fee - - 10,417 25,750 26,523 27,318 28,138 28,982 29,851 30,747 31,669 32,619 33,598 34,606 35,644 36,713 37,815 38,949 40,118 Total Payment - - (10,417) - - - - - - - (11,758) (75,052) (71,022) (66,718) (62,128) (57,242) (52,047) (46,530) (40,680) Ending Accrual Balance - - - 25,750 52,273 79,591 107,728 136,710 166,562 197,308 217,220 174,787 137,363 105,251 78,767 58,238 44,006 36,425 35,862 Inflator:Potential GP PM Fee:25,0003.00% 0 0 10,417 25,750 26,523 27,318 28,138 28,982 29,851 30,747 31,669 32,619 33,598 34,606 35,644 36,713 37,815 38,949 40,118 TOTAL Cumulative to GP: 0 0 10,417 30,870 42,395 43,667 44,977 46,326 47,716 49,147 62,380 127,193 124,726 122,033 119,103 115,926 112,492 108,789 104,806 TOTAL Cumulative to LP: 0 0 2,083 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524 6,720 6,921 7,129 7,343 7,563 7,790 8,024 Max to GP: 0 0 20,833 51,500 53,045 54,636 56,275 57,964 59,703 61,494 63,339 65,239 67,196 69,212 71,288 73,427 75,629 77,898 80,235 Excess GP Fees: 0 0 0 0 0 0 0 0 0 0 0 61,954 57,531 52,822 47,815 42,499 36,862 30,890 24,571

SCHEDULE OF RESERVE BALANCES
Capitalized Replacement ReserveDeed-Secured?YPrevious Balance 0 0 0 10,417 35,625 61,338 87,564 114,316 141,602 169,434 197,823 226,779 256,315 286,441 317,170 348,513 380,483 413,093 446,355 Deposit to Reserve 0 0 10,417 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 Interest on Reserve 2.0% 0 0 0 208 713 1,227 1,751 2,286 2,832 3,389 3,956 4,536 5,126 5,729 6,343 6,970 7,610 8,262 8,927 Withdrawal from Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance 0 0 0 10,417 35,625 61,338 87,564 114,316 141,602 169,434 197,823 226,779 256,315 286,441 317,170 348,513 380,483 413,093 446,355 480,282 Capitalized Operating Reserve (4 mos.)Deed-Secured?YPrevious Balance 0 0 0 204,000 208,080 212,242 216,486 220,816 225,232 229,737 234,332 239,019 243,799 248,675 253,648 258,721 263,896 269,174 274,557 Deposit to Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest on Reserve 2.0% 0 0 0 4,080 4,162 4,245 4,330 4,416 4,505 4,595 4,687 4,780 4,876 4,973 5,073 5,174 5,278 5,383 5,491 Withdrawal from Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance 204,000 0 0 0 208,080 212,242 216,486 220,816 225,232 229,737 234,332 239,019 243,799 248,675 253,648 258,721 263,896 269,174 274,557 280,048 Capitalized HCD Subsidy Transistion ReserveDeed-Secured?YPrevious Balance 0 0 0 289,256 295,041 300,942 306,961 313,100 319,362 325,749 332,264 338,910 345,688 352,601 359,653 366,847 374,183 381,667 389,300 Deposit to Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Interest on Reserve 2.0% 0 0 0 5,785 5,901 6,019 6,139 6,262 6,387 6,515 6,645 6,778 6,914 7,052 7,193 7,337 7,484 7,633 7,786 Withdrawal from Reserve 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Ending Balance 289,256 0 0 0 295,041 300,942 306,961 313,100 319,362 325,749 332,264 338,910 345,688 352,601 359,653 366,847 374,183 381,667 389,300 397,087 Villa St. Joseph
327

Schedule of Deductions Version:2.18
Depreciation Assumptions Building: ResidentialBuilding: CommercialSite ImprovementsPersonal PropertyProrationAsset LifeMethod Asset LifeMethod Asset LifeMethod Asset LifeMethodSoft Costs Prorated into ADS 100.0%30.0straight line30.0straight line90.0%20 Yr SL 90.0%9 Yr SLNC/Rehab, Sitework, and PPMACRS 0.0% 27.5straight line27.5straight line10.0%15 Yr 150% DB10.0%5 Yr DDBClasses?Y DEPRECIATION SCHEDULECredit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Beginning Basis20212022202320242025202620272028202920302031203220332034203520362037203820392040 30 years straight line - Res - Building5,891,500 0 0 73,644196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383196,383 30 years straight line - Res - Rehab27,000,060 0 0337,501900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002900,002 Site Improvements (20 yr SL.)492,055 0 0 12,30124,60324,60324,60324,60324,60324,60324,60324,60324,60324,60324,60324,60324,60324,60324,60324,603 Site Improvements (15 yr 150% decl. bal.)54,673 0 0 33,8972,0781,8701,6831,5151,3631,2911,2911,2911,2911,2911,2911,2911,2911,291 646 0 Personal Property (9 yr SL)632,851 0 0 35,15870,31770,31770,31770,31770,31770,31770,31770,31735,158 0 0 0 0 0 0 0 Personal property (5 yr 200% decl. bal.)70,317 0 0 47,8159,0015,4003,2403,2401,620 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL 34,141,4560 0 0540,3171,202,3831,198,5751,196,2281,196,0601,194,2881,192,5961,192,5961,192,5961,157,4381,122,2791,122,2791,122,2791,122,2791,122,2791,121,6341,120,988

AMORTIZATION SCHEDULE
TCAC Application/Res/Monitoring Fee89,470 0 0 5,9655,9655,9655,9655,9655,9655,9655,9655,9655,9655,9655,9655,9655,9655,965 0 0Costs of Issuance 0 0 0 0190,948 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Title/Recording/Escrow - Permanent40,000 0 0 0 857 1,1431,1431,1431,1431,1431,1431,1431,1431,1431,1431,1431,1431,1431,1431,143Market/Rent Comp Study13,500 0 0 1,3501,3501,3501,3501,3501,3501,3501,3501,3501,350 0 0 0 0 0 0 0 SUBTOTAL 142,970 0 0 0 7,315199,1208,4588,4588,4588,4588,4588,4588,4588,4587,1087,1087,1087,1087,1081,1431,143 EXPENSED COSTS Audit/Cost Certification 30,000 0 0 30,000 0 0Marketing 0 0 0 0 0 0LP AMF 1 0 0 2,0835,1505,3055,4645,6285,7965,9706,1496,3346,5246,7206,9217,1297,3437,5637,7908,024GP PM Fee 0 0 10,417 0 0 0 0 0 0 0 11,75875,05271,02266,71862,12857,24252,04746,53040,680Ground Lease - Minimum Payment 0 0 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1OCHCD Monitoring Fee 0 0 1,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,7101,710 SUBTOTAL 30,000 0 0 0 44,2106,8617,0167,1757,3397,5077,6817,86019,80383,28779,45375,35070,96866,29661,32156,03150,415 NOTE: PMF/CMF not expensed INTEREST DEDUCTIONS Interest - Seller Carryback Loan (SJCO)Seller Carryback Loan (SJCO)0 0108,060191,062197,061203,249209,631216,214223,003230,005237,227244,676252,359260,283268,456276,885285,580294,547303,796Interest - Cal HFA SNHPCal HFA SNHP 0 0 39,30068,57669,80271,05072,32073,61374,92976,26977,63279,02080,43381,87083,33484,82486,34087,88489,455Interest - County of Orange HOME LoanCounty of Orange HOME Loan0 0 0 13,68418,49018,82119,15719,50019,84820,20320,56420,93221,30621,68722,07522,46922,87123,28023,696Interest - HCD - NPLH Non-CompetitiveHCD - NPLH Non-Competitive0 0 0 28,55038,49139,06439,64740,24240,84841,46642,09542,73643,39044,05644,73445,42646,13146,84947,581Interest - HCD - NPLH CompetitiveHCD - NPLH Competitive0 0 0 51,98670,08671,12972,19273,27574,37875,50376,64977,81779,00780,21981,45582,71483,99885,30586,638Interest - County of Orange MHSA LoanCounty of Orange MHSA Loan0 0 0 18,77125,36425,81726,27926,74827,22727,71328,20928,71329,22629,74930,28130,82231,37331,93432,505Interest - City of Orange HOME LoanCity of Orange HOME Loan0 0 0 8,73211,79912,00912,22412,44312,66512,89213,12213,35713,59513,83814,08614,33814,59414,85515,120Interest - City of Orange LMIHA LoanCity of Orange LMIHA Loan0 0 0 7,72310,43510,62210,81211,00511,20211,40211,60611,81312,02512,24012,45812,68112,90813,13913,373Interest - City of Orange In-Lieu Fees LoanCity of Orange In-Lieu Fees Loan0 0 0 8,38711,43411,77712,13112,49512,86913,25513,65314,06314,48514,91915,36715,82816,30316,79217,295Interest- Expensed Constr. Period Interest 0 0573,003245,573 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL 0 0 0720,363643,045452,963463,538474,393485,534496,969508,708520,757533,127545,825558,861572,246585,987600,096614,583629,459 TOTAL DEDUCTIONS 0 0 01,312,2052,051,4091,667,0111,675,3981,686,2481,695,7871,705,7041,717,6221,741,6141,782,3091,754,6641,763,5981,772,6011,781,6701,790,8041,793,3911,802,004 Villa St. Joseph
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Analysis of Taxable Income Version:2.18 AssumptionsMarginal Tax Rate - Federal 21.0% Loss Reallocation (year 12):Marginal Tax Rate - State 0.0% GP Share:90.00% CombinedEffective Combined Marginal Tax Rate21.0% LP Share:10.00% Number of LP Capital Contributions4 Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 2022202320242025202620272028202920302031203220332034203520362037203820392040LOSSESNet Operating Income 0 0 64,597154,213152,169149,932147,495144,848141,982138,890135,560131,982128,148124,045119,663114,991110,016104,72799,110Interest Income from Reserves 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Total Deductions 0 01,312,2052,051,4091,667,0111,675,3981,686,2481,695,7871,705,7041,717,6221,741,6141,782,3091,754,6641,763,5981,772,6011,781,6701,790,8041,793,3911,802,004 Total Taxable Income (Loss) 0 0(1,247,608)(1,897,196)(1,514,842)(1,525,466)(1,538,754)(1,550,939)(1,563,722)(1,578,732)(1,606,054)(1,650,327)(1,626,517)(1,639,553)(1,652,937)(1,666,679)(1,680,788)(1,688,665)(1,702,895) Special Allocation of GP-Related Op Ex (see below)Years 1-11Years 12-150 0 (7,731)(16,536)(17,032)(17,543)(18,069)(18,611)(19,169)(19,744)(21,513)(28,452)(28,678)(28,894)(29,102)(29,300)(29,488)(29,665)(29,830)General Partner Share of Losses per LPA (pre-704(b))0.01%90.00%0 0 (7,855)(16,724)(17,182)(17,694)(18,221)(18,764)(19,324)(19,900)(21,671)(28,614)(28,837)(1,478,487)(1,490,554)(1,502,941)(1,515,658)(1,522,765)(1,535,588)Limited Partner Share of Losses per LPA (pre-704(b))99.99%10.00%0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)(165,900)(167,306) AFTER-TAX VALUE OF LOSSESYears 1-11Years 12-15Total Losses Allocated to GP (post-704(b))0.01%90.00%0 0 (7,855)(16,724)(17,182)(17,694)(18,221)(18,764)(19,324)(19,900)(21,671)(28,614)(28,837)(1,478,487)(1,490,554)(1,502,941)(1,515,658)(1,688,665)(1,702,895)Total Losses Allocated to LP (post-704(b))99.99%10.00%0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)0 0 After Tax Value of Losses 21.0% 0 0261,998398,411318,117320,348323,138325,697328,382331,534337,271346,569341,568344,306347,117350,003352,966354,620357,608After-Tax Value of General Partner Losses 0 0 1,6503,5123,6083,7163,8263,9414,0584,1794,5516,0096,056310,482313,016315,618318,288354,620357,608After-Tax Value of Limited Partner Losses 0 0260,348394,899314,509316,632319,312321,757324,324327,355332,720340,560335,51333,82434,10134,38534,677 0 0Limited Partner Share of Losses Per LPA 99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%10.00%10.00%10.00%10.00%10.00%10.00% TAX CREDITS Fed Tax Credits-Acq - Building A or Credit Year 1100.0% 0 0 97,390235,660235,660235,660235,660235,660235,660235,660235,660235,660138,270 0 0 0Fed Tax Credits-Rehab- Building A or Credit Year 1100.0% 0 0604,8521,463,5941,463,5941,463,5941,463,5941,463,5941,463,5941,463,5941,463,5941,463,594858,741 0 0 0 TOTAL TAX CREDITS 0 0702,2431,699,2541,699,2541,699,2541,699,2541,699,2541,699,2541,699,2541,699,2541,699,254997,011 0 0 0 0 0 0General Partner Share 0.01% 0 0 70 170 170 170 170 170 170 170 170 170 100 0 0 0 0 0 0Limited Partner Share 99.99% 0 0702,1721,699,0841,699,0841,699,0841,699,0841,699,0841,699,0841,699,0841,699,0841,699,084996,911 0 0 0 0 0 0(less) Reduction due to LP Capital Account Adjustment0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL AFTER-TAX BENEFITS 0 0964,2402,097,6652,017,3702,019,6022,022,3922,024,9512,027,6352,030,7872,036,5252,045,8221,338,580344,306347,117350,003352,966354,620357,608 General Partner Share 0.01% 0 0 1,7203,6823,7783,8863,9964,1104,2284,3494,7216,1796,156310,482313,016315,618318,288354,620357,608Limited Partner Share 99.99% 0 0962,5202,093,9832,013,5922,015,7162,018,3962,020,8402,023,4072,026,4382,031,8042,039,6431,332,42433,82434,10134,38534,677 0 0 OPERATING EXPENSE REALLOCATIONS-GP-RELATED (Beginning at start of operations) Base Year: 2022 2022202320242025202620272028202920302031203220332034203520362037203820392040Administrative 18,473 0 0 8,16620,18620,79221,41522,05822,71923,40124,10324,82625,57126,33827,12827,94228,78029,64430,53331,449Management Fee 41,160 0 0 18,19444,97746,32647,71649,14750,62252,14053,70455,31656,97558,68460,44562,25864,12666,05068,03170,072Resident Services 91,692 0 0 40,532100,194103,200106,296109,485112,770116,153119,637123,226126,923130,731134,653138,692142,853147,139151,553156,099GP PMF (Manually Link to Res Cash Flow Page)25,000 0 0 10,417 0 0 0 0 0 0 0 11,75875,05271,02266,71862,12857,24252,04746,53040,680TOTAL 151,325 0 0 77,309165,357170,318175,427180,690186,111191,694197,445215,126284,521286,775288,944291,021293,001294,879296,648298,301 Seller Note Loan Interest 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Total Related Party Loan Interest 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Percent Reallocated to GP 10.0%
TOTAL EXPENSE REALLOCATION TO GP 0 0 7,73116,53617,03217,54318,06918,61119,16919,74421,51328,45228,67828,89429,10229,30029,48829,66529,830Note: Begins @ Operations Start Villa St. Joseph
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Capital Account Analysis and Tax Liability - Sale Price Equals Debt Version:2.18 LIMITED PARTNER Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 2022202320242025202620272028202920302031203220332034203520362037203820392040 SUMMARY OF LP ACCOUNTS AND LOSSESTotal Losses Allocated to LP 0 0 1,239,753 1,880,472 1,497,660 1,507,773 1,520,533 1,532,175 1,544,398 1,558,832 1,584,383 1,621,712 1,597,679 161,066 162,384 163,738 165,130 0 0 Ending LP Capital Account Balance 1,643,864 1,643,864 917,301 13,109,945 11,612,284 10,104,511 8,583,979 7,051,804 5,507,406 3,948,574 2,364,191 742,479 (855,200)(1,016,266)(1,178,650)(1,342,388)(1,507,518)(1,507,518)(1,507,518)Ending LP Minimum Gain Balance 0 0 0 0 0 0 0 0 0 0 0 46,503 793,636 794,039 794,377 794,649 794,849 961,474 1,129,429 MINIMUM GAIN ANALYSISAdjusted Basis 34,079,95634,079,95633,539,63932,337,25631,138,68129,942,45328,746,39427,552,10626,359,50925,166,91323,974,31722,816,87921,694,60020,572,32019,450,04118,327,76117,205,48216,083,84814,962,860Deed-Secured Cash Reserves 0 0 10,417538,746574,521611,011648,232686,196724,920764,419804,707845,801887,717930,472974,0811,018,5631,063,9341,110,2131,157,417Total Adjusted Basis plus Cash 34,079,95634,079,95633,550,05632,876,00231,713,20230,553,46529,394,62528,238,30227,084,43025,931,33224,779,02423,662,68022,582,31721,502,79220,424,12219,346,32418,269,41617,194,06116,120,277Outstanding Nonrecourse Debt 9,422,3299,668,1239,920,74019,962,76320,392,03020,831,87321,282,57021,744,40922,217,68322,702,69523,199,75723,709,18824,231,31824,766,48425,315,03425,877,32626,453,72827,044,61627,650,379Outstanding Nonrecourse Debt (Related Party) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Minimum Gain - Partnership 0 0 0 0 0 0 0 0 0 0 0 46,5081,649,0013,263,6924,890,9136,531,0038,184,3129,850,55511,530,103Annual Change in Minimum Gain 0 0 0 0 0 0 0 0 0 0 0 46,5081,602,4931,614,6911,627,2201,640,0901,653,3091,666,2431,679,548Minimum Gain - Partner (GP) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 POTENTIAL LIMITED PARTNER LOSSESLP Share of Losses per LPA 99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%99.99%10.00%10.00%10.00%10.00%10.00%10.00%Annual Potential Losses Allocated to LP 0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)(165,900)(167,306)(less) Related Party Losses Reallocated to GP 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Adjusted Potential LP Losses 0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)(165,900)(167,306) LP LOSS ANALYSIS -- CAPITAL ACCOUNT SHAREBeginning LP Capital Account Balance 01,643,8641,643,864917,30113,109,94511,612,28410,104,5118,583,9797,051,8045,507,4063,948,5742,364,191742,479(855,200)(1,016,266)(1,178,650)(1,342,388)(1,507,518)(1,507,518)LP Capital Contributions 1,643,8640721,65614,073,1150 0 0 0 0 0 0 0 0 0 0 0 0 0 0(less) LP Cash Flow Distributions 0 0 (39,966)0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0(less) Historic Tax Credits 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0(less) Investment Tax Credits (Solar) 0 0 0 0 0LP Capital Account Balance Available for Losses1,643,8641,643,8642,325,55414,990,41613,109,94511,612,28410,104,5118,583,9797,051,8045,507,4063,948,5742,364,191742,479 0 0 0 0 0 0 Adjusted Potential LP Losses 0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)(165,900)(167,306)Allowable LP Capital Account Losses (1,643,864)(1,643,864)(2,325,554)(14,990,416)(13,109,945)(11,612,284)(10,104,511)(8,583,979)(7,051,804)(5,507,406)(3,948,574)(2,364,191)(742,479)0 0 0 0 0 0Actual Losses Allocated to LP (Capital Account Share)0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(742,479)0 0 0 0 0 0LP DRO? Y Y Y YCumulative DRO Amount 0 0 0 0 LP LOSS ANALYSIS -- MINIMUM GAIN SHARELP Minimum Gain Balance Available for Losses0 0 0 0 0 0 0 0 0 0 0 46,5031,648,836955,105956,761958,386959,980961,4741,129,429 Adjusted Potential LP Losses less Cap Acct Losses0 0 0 0 0 0 0 0 0 0 0 0(855,200)(161,066)(162,384)(163,738)(165,130)(165,900)(167,306)Allowable LP Minimum Gain Account Losses 0 0 0 0 0 0 0 0 0 0 0 (46,503)(1,648,836)(955,105)(956,761)(958,386)(959,980)(961,474)(1,129,429)Actual Losses Allocated to LP (Minimum Gain Share)0 0 0 0 0 0 0 0 0 0 0 0(855,200)(161,066)(162,384)(163,738)(165,130)0 0 TOTAL LOSSES ALLOCATED TO LP 0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)0 0 LIMITED PARTNER CREDIT DELIVERY ANALYSISLP 704(b) Capital Available for Losses 1,643,8641,643,8642,325,55414,990,41613,109,94511,612,28410,104,5118,583,9797,051,8045,507,4063,948,5742,410,6952,391,315955,105956,761958,386959,980961,4741,129,429LP Share of Depreciation per LPA 0 0540,2631,202,2631,198,4551,196,1081,195,9401,194,1691,192,4771,192,4771,192,4771,157,3221,122,167112,228112,228112,228112,228112,163112,099Reduction in LP LIHTC due to 704(b) Capital Shortfall 0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00% LIMITED PARTNER CAPITAL ACCOUNTBeginning Capital Account Balance 01,643,8641,643,864917,30113,109,94511,612,28410,104,5118,583,9797,051,8045,507,4063,948,5742,364,191742,479(855,200)(1,016,266)(1,178,650)(1,342,388)(1,507,518)(1,507,518)LP Capital Contributions 1,643,8640721,65614,073,1150 0 0 0 0 0 0 0 0 0 0 0 0 0 0(less) Syndication Expenses 0 0(168,500)0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0(less) LP Cash Flow Distributions 0 0 (39,966)0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0(less) Total Losses Allocated to LP 0 0(1,239,753)(1,880,472)(1,497,660)(1,507,773)(1,520,533)(1,532,175)(1,544,398)(1,558,832)(1,584,383)(1,621,712)(1,597,679)(161,066)(162,384)(163,738)(165,130)0 0End of Year Capital Account Balance 1,643,8641,643,864917,30113,109,94511,612,28410,104,5118,583,9797,051,8045,507,4063,948,5742,364,191742,479(855,200)(1,016,266)(1,178,650)(1,342,388)(1,507,518)(1,507,518)(1,507,518) LIMITED PARTNER MINIMUM GAIN BALANCEBeginning Minimum Gain Account Balance 0 0 0 0 0 0 0 0 0 0 0 0 46,503793,636794,039794,377794,649794,849961,474LP Share of Annual Change in Minimum Gain 0 0 0 0 0 0 0 0 0 0 0 46,5031,602,333161,469162,722164,009165,331166,624167,955(less) Minimum Gain Chargeback (Losses allocated to LP)0 0 0 0 0 0 0 0 0 0 0 0(855,200)(161,066)(162,384)(163,738)(165,130)0 0End of Year Minimum Gain Balance 0 0 0 0 0 0 0 0 0 0 0 46,503793,636794,039794,377794,649794,849961,4741,129,429 Villa St. Joseph
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Capital Account Analysis and Tax Liability - Sale Price Equals Debt Version:2.18 LIMITED PARTNER Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 2022202320242025202620272028202920302031203220332034203520362037203820392040 Villa St. Joseph
LIMITED PARTNER EXIT BENEFIT/LIABILITY ANALYSISMarginal Tax Rate 21.00%End of Year Capital Account Balance 1,643,8641,643,864917,30113,109,94511,612,28410,104,5118,583,9797,051,8045,507,4063,948,5742,364,191742,479(855,200)(1,016,266)(1,178,650)(1,342,388)(1,507,518)(1,507,518)(1,507,518)(plus) Syndication Expenses 0 0168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500168,500Tax Benefit/(Liability) on Sale @ $1 345,211345,211228,0182,788,4732,473,9652,157,3321,838,0211,516,2641,191,940864,586531,865191,306(144,207)(178,031)(212,131)(246,516)(281,194)(281,194)(281,194)Gross-Up Factor for Taxes on Gain due to Tax Payment79.00%Total GP Obligation on Sale: LP Tax Liability + Gross-Up0 0 0 0 0 0 0 0 0 0 0 0(182,541)(225,356)(268,521)(312,046)(355,941)(355,941)(355,941) GENERAL PARTNER Credit Period Year:(1) 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 2022202320242025202620272028202920302031203220332034203520362037203820392040 Minimum Gain - Partnership 0 0 0 0 0 0 0 0 0 0 0 46,5081,649,0013,263,6924,890,9136,531,0038,184,3129,850,55511,530,103Minimum Gain - Partnership - GP Share 0 0 0 0 0 0 0 0 0 0 0 5 1652,937,3234,401,8215,877,9027,365,8818,865,50010,377,092Minimum Gain - Partner (GP) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0GP Share of Losses per LPA 0.01%0.01%0.01%0.01%0.01%0.01%0.01%0.01%0.01%0.01%0.01%0.01%0.01%90.00%90.00%90.00%90.00%90.00%90.00% CAPITAL ACCOUNTBeg. of Yr Capital Account Balance 0 0 0 (7,859)(24,583)(41,764)(59,458)(77,679)(96,443)(115,767)(135,667)(157,338)(185,953)(214,790)(1,693,277)(3,183,831)(4,686,772)(6,202,430)(7,891,095)Capital Contributions 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Annual GP Losses @ LPA Share 0 0 (7,855)(16,724)(17,182)(17,694)(18,221)(18,764)(19,324)(19,900)(21,671)(28,614)(28,837)(1,478,487)(1,490,554)(1,502,941)(1,515,658)(1,522,765)(1,535,588)LP Losses Re-allocated to GP (Related Party) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0LP Losses Re-allocated to GP (Capital Account Shortfall)0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0(165,900)(167,306)Cash Flow 0 0 4 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0End of Year Capital Account 0 0 (7,859)(24,583)(41,764)(59,458)(77,679)(96,443)(115,767)(135,667)(157,338)(185,953)(214,790)(1,693,277)(3,183,831)(4,686,772)(6,202,430)(7,891,095)(9,593,990) 331

Investment Summary - LIHTC Investor Version: 2.18
Assumptions
Marginal Tax Rate 21.0%

CUMULATIVE

TOTAL TOTAL TOTAL TOTAL TAX TOTAL RATIO OF

LIMITED AFTER- LTD PTR LTD PTR LTD PTR LTD PTR BENEFIT/ LTD PTR BENEFITS

PARTNER TAX VALUE FEDERALCALIFORNIA ENERGY HISTORIC (LIABILITY) TAXTO LTD PTR

YEAR PAY-INS OF LOSSES LIHTC LIHTC CREDITS CREDITSUPON SALE BENEFITS PAY-INS Credit Year
2022 1,643,864 0 0 0 0 0 0 0.00(1)
2023 0 0 0 0 0 0 0 0.000
2024 721,656 260,348 702,172 0 0 0 962,520 0.411
2025 14,073,115 394,899 1,699,084 0 0 0 2,093,983 0.192 2026 0 314,509 1,699,084 0 0 0 2,013,592 0.313
2027 316,632 1,699,084 0 0 0 2,015,716 0.434
2028 319,312 1,699,084 0 0 0 2,018,396 0.555
2029 321,757 1,699,084 0 0 0 2,020,840 0.686
2030 324,324 1,699,084 2,023,407 0.807
2031 327,355 1,699,084 2,026,438 0.928
2032 332,720 1,699,084 2,031,804 1.059
2033 340,560 1,699,084 2,039,643 1.1710
2034 335,513 996,911 1,332,424 1.2511
2035 33,824 0 33,824 1.2512
2036 34,101 0 0 34,101 1.2613
2037 34,385 0 0 34,385 1.2614
2038 34,677 0 0 34,677 1.2615
2039 0 0 (281,194) (281,194) 1.2416
2040 0 0 0 0 1.2417
TOTAL 16,438,635 3,724,914 16,990,837 0 0 0 20,434,558 Villa St. Joseph
332
Villa St. Joseph Page 17a
Net Quarterly Benefit ScheduleVersion: 2.18

LP EQUITY PAY-IN SCHEDULE

AMOUNT DATETHRESHOLD
LP Admission (Const. Portion)1,643,86412/01/22Initial Closing Completion Payment 721,65607/01/24Const. Completion
Stabilization Payment 0 04/01/25Stabilization
Conversion Payment 13,973,11504/01/25Perm Conversion
Final Payment #1 100,00010/01/258609
TOTAL LP CONTRIBUTIONS16,438,635

NET QUARTERLY BENEFITS
Internal Rate of Return:5.49%

TOTAL NET
QUART.QUART.

YEARINVESTMENTBENEFITSBENEFITSTHRESHOLD
2022 0 0
0 0
0 0
-1,643,864 0 -1,643,864LP Admission
2023 0 0
0 0
0 0
0 0
2024 0 0
0 0
-721,656481,260 -240,396Completion
481,260 481,260
2025 523,496 523,496
-13,973,115523,496 -13,449,619Stabilization / Perm Conversion 523,496 523,496
-100,000523,496 423,496Form 8609
2026 503,398 503,398
503,398 503,398
503,398 503,398
503,398 503,398
2027 0 503,929 503,929
0 503,929 503,929
0 503,929 503,929
0 503,929 503,929
2028 0 504,599 504,599
0 504,599 504,599
0 504,599 504,599
0 504,599 504,599
2029 0 505,210 505,210
0 505,210 505,210
0 505,210 505,210
0 505,210 505,210
2030 505,852 505,852
505,852 505,852
505,852 505,852
505,852 505,852
2031 506,610 506,610
506,610 506,610
506,610 506,610
506,610 506,610
2032 507,951 507,951
507,951 507,951
507,951 507,951
507,951 507,951
2033 509,911 509,911
509,911 509,911
509,911 509,911
509,911 509,911
2034 333,106 333,106
333,106 333,106
333,106 333,106
333,106 333,106
2035 8,456 8,456
8,456 8,456
8,456 8,456
8,456 8,456
2036 8,525 8,525
8,525 8,525
8,525 8,525
8,525 8,525
2037 8,596 8,596
8,596 8,596
8,596 8,596
8,596 8,596
2038 8,669 8,669
8,669 8,669
8,669 8,669
8,669 8,669
2039 (281,194)-281,194
0 0
0 0
0 0
2040 0 0
0 0
0 0
0 0
TOTAL 16,438,63520,434,558 3,995,923
333
480 South Batavia Street
Notice of Affordability Restrictions

Recording Requested by and
When Recorded Mail to:

THE CITY OF ORANGE
300 E. Chapman Avenue
Orange, CA 92866
Attention:

APN: OFFICIAL BUSINESS
Document entitled to free
recording per Government
Code Section 27383

NOTICE OF AFFORDABILITY RESTRICTIONS
NOTICE IS HEREBY GIVEN that pursuant to Health & Safety Code Section 33334.3(f), the City of Orange is recording this Notice of Affordability Restrictions (hereinafter the “Notice”) with regard to the property located at 480 South Batavia Street, Orange, California, and more particularly described in Exhibit “A” attached hereto (the “Property”).

The Property is subject to an Agreement Containing Covenants (the “ Covenants”) recorded concurrently herewith, which restricts the use of the Property as follows:
(1) Eighteen (18) Units will be rented exclusively to an Extremely Low Income Senior Citizen Household at an Affordable Rent as provided in California Health and Safety Code Section 50106, all consisting of one bedroom Units; (2) Six (6) Units will be rented exclusively to Very Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50105, consisting of two (2) studio Units and four (4) one bedroom Units;
(3) Twenty-five (25) Units will be rented exclusively to Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50079.5, consisting of four (4) studio Units and twenty-one (21) one bedroom Units;
(4) Eighteen (18) Units will be rented exclusively to households meeting the twenty percent (20%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, all consisting of one-bedroom Units;
Attachment 6
334
480 South Batavia Street
Notice of Affordability Restrictions

(5) Six (6) Units will be rented exclusively to households meeting the thirty percent (30%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) two (2) studio Units; and (b) four (4) one-bedroom Units; (6) Thirteen (13) Units will be rented exclusively to households meeting the forty percent (40%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) two (2) studio Units; and (b) eleven (11) one-bedroom Units; and
(7) Twelve (12) Units will be rented exclusively to households meeting the fifty percent (50%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) two (2) studio Units; and (b) ten (10) one-bedroom Units.

The maximum incomes of eligible tenants under (1), (2) and (3) above will be determined on the basis of the income limits for Extremely Low Income, Very Low Income and Low Income households in the Los Angeles-Long Beach-Anaheim SMSA, published approximately annually by the California Department of Housing and Community Development (“ HCD”). If HCD discontinues publishing such income limits, the term “Extremely Low Income” will mean a household income that does not exceed 30% of the area median income, adjusted for family size, the term “Very Low Income” will mean a household income that does not exceed 50% of the area median income, adjusted for family size, and the term “Low Income” will mean a household income that does not exceed 70% of the area median income, adjusted for family size. For the term of the Tax Credits, in no case will household income exceed applicable Tax Credit income limits.

Rents charged to a tenant will not exceed rents that are affordable to Extremely Low Income, Very Low Income and Low Income households, as applicable, (as “ Affordable Rent” is defined below). The maximum rents, including a reasonable utility allowance for utilities and services (excluding telephone) to be paid by Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households will be the lower of the maximum rent applicable to Low Income Housing Tax Credits pursuant to the Tax Reform Act of 1986, as amended, and governed by Section 42 of Internal Revenue Code requirements for so long as such requirements are applicable or the maximum rent for the applicable income level as set forth below:
(a) In the case of an Extremely Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of thirty 335
480 South Batavia Street
Notice of Affordability Restrictions

percent (30%) of the area median income adjusted for household size appropriate to the unit, as determined by the California Department of Housing and Community Development;
(b) In the case of a Very Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of fifty percent (50%) of the area median income adjusted for household size appropriate to the unit, as determined by the California Department of Housing and Community Development;
(c) In the case of a Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of seventy percent (70%) of the area median income adjusted for household size appropriate to the unit, as determined by the California Department of Housing and Community Development; and
(d) In the case of a Senior Citizen Household occupying a unit described in Paragraph (4), (5), (6) or (7) above, the maximum rent will be the maximum allowable rent under the Extended Use Agreement recorded against the Property in connection with the Tax Credits.

For the purpose of determining Affordable Rent under Paragraphs (1), (2) and (3), household size appropriate to the unit will mean one (1) person in the case of a studio and two (2) persons in the case of a 1-bedroom unit.

The affordability restrictions imposed on the Property by the Covenants are scheduled to expire on the date that is fifty-five (55) years after the date of Conversion (i.e., around ____________, 20__).

This Notice is recorded for the purpose of providing notice only and it in no way modifies the provisions of the Covenants.
[Remainder of Page Intentionally Left Blank; Signatures on Following Page] 336
480 South Batavia Street
Notice of Affordability Restrictions
S-1
CITY OF ORANGE, a municipal corporation
of the State of California
By: ___________________
Mark A. Murphy, Mayor
ATTEST:
_______________________
Pamela Coleman, City Clerk
APPROVED AS TO FORM:

By:_______________________________
Gary A. Sheatz, City Attorney
[SIGNATURES CONTINUE ON NEXT PAGE]
337
480 South Batavia Street
Notice of Affordability Restrictions
Consent to Recordation

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

Mercy Housing California 107, L.P.,
a California limited partnership
By: Mercy Housing California 107 LLC,
a California limited liability company,
its general partner
By: Mercy Housing Calwest,
a California nonprofit public benefit
corporation, its sole member/manager
By: ____________________________
Erika Villablanca,
Vice President
338

STATE OF CALIFORNIA )
)

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

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

WITNESS my hand and official seal.

Signature (Seal)
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. 339

STATE OF CALIFORNIA )
)

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

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

WITNESS my hand and official seal.

Signature (Seal)
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. 340

STATE OF CALIFORNIA )
)

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

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

WITNESS my hand and official seal.

Signature (Seal)
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. 341
480 South Batavia Street
Notice of Affordability Restrictions
Exhibit A – Legal Description
Exhibit “A”

LEGAL DESCRIPTION
APN: 5674-010-901
342
480 South Batavia Street
Agreement Containing Covenants
Page S-1
Recording Requested by and
When Recorded Mail to:

THE CITY OF ORANGE
300 E. Chapman Avenue
Orange, CA 92866
Attention:

APN: OFFICIAL BUSINESS
Document entitled to free
recording per Government
Code Section 27383

AGREEMENT CONTAINING COVENANTS
(Including Rental Restrictions)
(480 South Batavia Street)
THIS AGREEMENT CONTAINING COVENANTS (“Agreement”) is entered into as of __________________, 2022 by and between the CITY OF ORANGE, a municipal corporation of the State of California (“ City”) and MERCY HOUSING CALIFORNIA 107, L.P., a California limited partnership (“Developer”).

WHEREAS, Developer is the owner of that certain real property (“ Property”) located in the City of Orange and more particularly described in Exhibit “A” which is attached hereto and incorporated herein by this reference; and
WHEREAS, for the purpose of providing housing that will be affordable to Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households, Developer and the City have entered into an Affordable Housing Agreement, dated as of ________, 2022, as amended from time to time (“Affordable Housing Agreement”); this Agreement Containing Covenants is entered into pursuant to the Affordable Housing Agreement, a true and correct copy of which is on file in the office of the City Clerk of the City; and any capitalized term that is not otherwise defined in this Agreement has the meaning ascribed to such term in the Affordable Housing Agreement; and
WHEREAS, pursuant to the Affordable Housing Agreement, the City is providing financial assistance to Developer to assist in the acquisition and development and rehabilitation of the Property, using funds from the Low and Moderate Income Housing Asset Fund, established and maintained by the City pursuant to California Health and Safety Code Sections 34176 and 34176.1 (“LMIHAF”) and In Lieu Fees Funds; and
Attachment 7
343
480 South Batavia Street
Agreement Containing Covenants
Page S-2
WHEREAS, the Developer has obtained an allocation of Low Income Housing Tax Credits pursuant to the Tax Reform Act of 1986, as amended, and governed by Section 42 of Internal Revenue Code (“Tax Credits”); and
WHEREAS, the use of the Tax Credits to finance the development and rehabilitation of the Property imposes income and affordability requirements such that eighteen (18) of the units will be restricted at 20% tax credit limits, six (6) of the units will be restricted at 30% tax credit limits, thirteen (13) of the units will be restricted at 40% tax credit limits, and twelve (12) of the units will be restricted at 50% tax credit limits, provided however, that nothing herein will be deemed to authorize charging rents in excess of the Affordable Rent for the specified units set forth in Section 3.a below; and
WHEREAS, the Affordable Housing Agreement contains certain provisions relating to the use of the Property and imposes additional income and affordability requirements.

NOW, THEREFORE, CITY AND OWNER COVENANT AND AGREE AS FOLLOWS:

1. Construction Covenant.

Developer hereby covenants and agrees on behalf of itself and its successors and assigns in the Property or any portion thereof or any improvements thereon or any interest therein that Developer and such successors and assigns will develop and rehabilitate and construct on the Property a residential apartment Project, which will contain fifty (50) residential units (6 studios, 43 one-bedrooms and 1 two-bedroom manager’s unit) and associated amenities, in accordance with the Affordable Housing Agreement, this Agreement, and plans approved by the City.

2. Maximum Incomes.
a. Developer covenants and agrees for itself and its successors, its assigns and every successor in interest to the Property or any part thereof, that Developer and its successors and assignees will use the Property exclusively to provide affordable housing for Extremely Low, Very Low, and Low Income Senior Citizen Households, subject to all of the terms and conditions of this Agreement, except for one two-bedroom unit designated as the management unit for the on- site manager. The remaining 49 units will be allocated as follows:
i. Eighteen (18) Units will be rented exclusively to an Extremely Low Income Senior Citizen Household at an Affordable Rent as provided in California Health and Safety Code Section 50106, all consisting of one bedroom Units.
ii. Six (6) Units will be rented exclusively to Very Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50105, consisting of two (2) studio Units and four (4) one bedroom Units. iii. Twenty-five (25) Units will be rented exclusively to Low Income Senior Citizen Households at an Affordable Rent as provided in California Health and Safety Code Section 50079.5, consisting of four (4) studio Units and twenty-one (21) one bedroom Units. 344
480 South Batavia Street
Agreement Containing Covenants
Page S-3
iv. Eighteen (18) Units will be rented exclusively to households meeting the twenty percent (20%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, all consisting of one-bedroom Units. v. Six (6) Units will be rented exclusively to households meeting the thirty percent (30%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) two (2) studio Units; and (b) four (4) one-bedroom Units.
vi. Thirteen (13) Units will be rented exclusively to households meeting the forty percent (40%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) two (2) studio Units; and (b) eleven (11) one-bedroom Units.
vii. Twelve (12) Units will be rented exclusively to households meeting the fifty percent (50%) income limit under the Extended Use Agreement recorded against the Property in connection with the Tax Credits, consisting of the following: (a) two (2) studio Units; and (b) ten (10) one-bedroom Units.
b. The maximum incomes of eligible tenants for the units described in paragraphs

2.a.i, 2.a.ii and Error! Reference source not found.i above will be determined on the basis of the income limits for Extremely Low Income, Very Low Income and Low Income households respectively in the Los Angeles-Long Beach-Anaheim SMSA, published approximately annually by the California Department of Housing and Community Development (“ HCD”). If HCD discontinues publishing such income limits, the term “Extremely Low Income” will mean a household income that does not exceed 30% of the area median income, adjusted for family size, the term “Very Low Income” will mean a household income that does not exceed 50% of the area median income, adjusted for family size, and the term “Low Income” will mean a household income that does not exceed 70% of the area median income, adjusted for family size. For the term of the Tax Credits, in no case will household income exceed applicable Tax Credit income limits. c. Developer will obtain and maintain on file an income computation and certification form from such prospective tenant dated immediately prior to the date of initial occupancy.

Developer will verify that the income information provided by an applicant is accurate by following all applicable City policies and procedures and by taking one or more of the following steps as a part of the verification process: (i) obtain two (2) pay stubs from the most recent pay periods; (ii) obtain a written verification of income and employment from applicant’s current employer; (iii) obtain an income verification form from the Social Security Administration and/or California Department of Social Services if the applicant receives assistance from either agency; (iv) if an applicant is unemployed or did not file a tax return for the previous calendar year, obtain other verification of such applicant’s income as is reasonably satisfactory; or (v) obtain such other information as may be reasonably required. Each tenant lease will contain a provision to the effect that Developer has relied on the income certification and supporting information supplied by the tenant in determining qualification for occupancy of a Unit, and that any material misstatement in 345
480 South Batavia Street
Agreement Containing Covenants
Page S-4
such certification (whether or not intentional) will be cause for immediate termination of such lease.
d. Developer will update income records annually and provide copies of updated tenant eligibility records and monthly rental records to the City for review. Upon review of such records, the City may at its option perform an independent audit of the tenant eligibility records in order to verify compliance with the income and affordability requirements set forth herein. Costs for such an audit performed by the City will be deemed an Operating Expense, deductible from the Project’s Revenue (as such terms are defined in the LMIHAF Note and the In Lieu Fees Note).

Developer will retain the records described in this Section for a period of not less than five (5) years after the date each record was created.

3. Maximum Rents.
a. Rents charged to a tenant will not exceed rents that are affordable to Extremely Low Income, Very Low Income and Low Income households, as applicable, (as “ Affordable Rent” is defined below). The maximum rents, including a reasonable utility allowance for utilities and services (excluding telephone) to be paid by Extremely Low Income, Very Low Income, and Low Income Senior Citizen Households will be the lower of the maximum rent permitted to be charged pursuant to the Extended Use Agreement recorded against the Property in connection with the Tax Credit requirements for so long as such requirements are applicable and the maximum rent for the applicable income level as set forth below:
i. In the case of an Extremely Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of thirty percent (30%) of the area median income adjusted for household size appropriate to the unit, as determined by HCD. ii. In the case of a Very Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of fifty percent (50%) of the area median income adjusted for household size appropriate to the unit, as determined by HCD. iii. In the case of a Low Income Senior Citizen Household, the maximum rent will be a rent that does not exceed 30 percent (30%) of seventy percent (70%) of the area median income adjusted for household size appropriate to the unit, as determined by HCD iv. In the case of a Senior Citizen Household occupying a unit described in Paragraph Error! Reference source not found., 2.a.v, 2.a.vi or 2 a.vii above, the maximum rent will be the maximum allowable rent under the Extended Use Agreement recorded against the Property in connection with the Tax Credits.
v. For the purpose of determining Affordable Rent under Paragraphs 3.a.i,

3.a.ii and Error! Reference source not found.i, household size appropriate to the unit will mean one (1) person in the case of a studio and two (2) persons in the case of a 1-bedroom unit. b. This affordability requirement will continue in effect for the Term of this Agreement.
346
480 South Batavia Street
Agreement Containing Covenants
Page S-5
c. Failure to comply with the affordability requirements of this Agreement following notice from the City and an opportunity to cure such failure is an event of default under the terms of the LMIHAF Loan and the In Lieu Fees Loan. Pursuant to the LMIHAF Note evidencing the LMIHAF Loan and the In Lieu Fees Note evidencing the In Lieu Fees Loan, subject to the right to cure, the LMIHAF Loan and the In Lieu Fees Loan will each be due and payable immediately if the housing does not meet the affordability requirements of this Agreement. d. Upon request, the City Manager will notify Developer of the maximum rents that may be charged under Paragraphs 3.a.i, 3.a.ii and Error! Reference source not found. i (not to exceed “Affordable Rent”) and the maximum income of persons who are eligible to occupy the Property, based on the then-current area median income. In no event will rents exceed the maximum rent permitted by the tax credit regulations or (with regard to the allocation of units set forth in Section 2.a hereof) the rules applicable to the use of LMIHAF and In Lieu Fees Fund moneys, whichever is the lowest.
e. Developer, its successors and assigns will not charge rents in excess of the amounts determined as set forth in Section 3. In the event that either Developer or the City determines that Developer has charged a tenant rent in excess of the amount set forth herein, Developer will immediately reimburse the tenant the amount of overpayment, with interest, from the date of rental payment, at the highest non-usurious rate of interest permitted by law, within ten (10) days of such determination. Developer may revise rents not more than once annually.

4. Project Monitoring Fee.

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

5. Tenant Selection.

Developer will adopt, based upon a draft prepared by the City, written tenant selection policies and criteria, for approval by the City, that meet the following requirements:
a. Are consistent with the purpose of providing housing for Extremely Low, Very Low Income, and Low Income Senior Citizen Households.
b. Are reasonably related to program eligibility and the applicants’ ability to perform the obligations of the lease.
c. Give reasonable consideration to the housing needs of persons that would have a preference under 42 CFR §906.211 (Federal selection preferences for admission to Public Housing);
347
480 South Batavia Street
Agreement Containing Covenants
Page S-6
d. Provide for:
i. The selection of otherwise eligible tenants from a written waiting list in the chronological order of their application, insofar as is practicable, taking into account applicants’ need for accessible features;
ii. The prompt written notification to any rejected applicant of the grounds for any rejection;
e. Tenant selection will be administered in accordance with the tenant selection plan approved by the City.
f. Carry out the Affirmative Marketing procedures of the City of Orange, to provide information and otherwise attract eligible persons from all racial, ethnic and gender groups in the housing market area. Developer and City will cooperate to effectuate this provision during the Developer’s initial lease-up of the Property and as vacancies occur.

6. Nondiscrimination Based on Source of Income.

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

7. Increases in Tenant Incomes.

This Section will govern in the event of increases in tenant incomes: (a) a tenant who initially qualified as an Extremely Low Income Household, but who, due to an increase in income, no longer qualifies as an Extremely Low Income Household but does qualify as a Very Low Income Household, will pay as rent an amount that is Affordable Rent to a Very Low Income Household, as defined in Section 2 above; (b) a tenant who initially qualified as a Very Low Income Household, but who, due to an increase in income, no longer qualifies as a Very Low Income Household but does qualify as a Low Income Household, will pay as rent an amount that is Affordable Rent to a Low Income Household, as set forth in Health and Safety Code section 50053; and (c) a tenant who initially qualified as a Very Low Income or a Low Income Household, but who, due to an increase in income, no longer qualifies as either a Very Low Income or a Low Income Household, will pay as rent the lesser of the amount payable by the tenant under tax credit regulations, State or local law or 30 percent of the household’s adjusted income.

8. Tenant Protections.

Each tenant lease must provide for housing for not less than one year, unless by mutual agreement between the tenant and the Developer. The lease may not contain any of the following 348
480 South Batavia Street
Agreement Containing Covenants
Page S-7
provisions (in which references to “owner” will mean the Developer, its successors or assigns):
a. Agreement by the tenant to be sued, to admit guilt, or to a judgment in favor of the owner in a lawsuit brought in connection with the lease; b. Agreement by the tenant that the owner may take, hold, or sell personal property of household members without notice to the tenant and a court decision on the rights of the parties.

This prohibition, however, does not apply to an agreement by the tenant concerning disposition of personal property remaining in the housing unit after the tenant has moved out of the unit. The owner may dispose of this personal property in accordance with state law; c. Agreement by the tenant not to hold the owner or the owner’s agents legally responsible for any action or failure to act, whether intentional or negligent; d. Agreement of the tenant that the owner may institute a lawsuit without notice to the tenant;
e. Agreement by the tenant that the owner may evict the tenant or household members without instituting a civil court proceeding in which the tenant has the opportunity to present a defense, or before a court decision on the rights of the parties; f. Agreement by the tenant to waive the right to a trial by jury; g. Agreement by the tenant to waive the tenant’s right to appeal, or to otherwise challenge in court, a court decision in connection with the tenant housing agreement; and h. Agreement by the tenant to pay attorney’s fees or other legal costs even if the tenant wins in a court proceeding by the owner against the tenant. The tenant, however, may be obligated to pay costs if the tenant loses.

9. Termination of Lease.

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

10. Maintenance Obligations.

Developer will maintain the improvements on the Property in compliance with all applicable housing quality standards and local code requirements, and will keep the Property free from any unreasonable accumulation of debris or waste materials. Maintenance will be performed in a manner that will preserve the Project’s LEED Platinum standards. Prior to the recordation of this Agreement, Developer prepared and submitted to the City Manager of the City for approval a program (the “ Maintenance Program ”) for the maintenance of the Property and the 349
480 South Batavia Street
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Improvements. For the Term of this Agreement, Developer, and its successors and assigns, will maintain the Property and the Improvements in accordance with the approved Maintenance Program, as the same may be amended from time to time with the written approval of the Executive Director of the City. If Developer fails to maintain the Property and the Improvements in accordance with the approved Maintenance Program, the City will have the right, but not the obligation, to enter the Property and the Improvements, correct any violation, and hold Developer responsible for the cost thereof, and such cost, until paid, will constitute a lien on the Property; provided, however that all such liens shall at all times be subject and subordinate to all deeds of trust and other liens granted to third party lenders providing financing for the Property.

11. Nondiscrimination.

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

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

That there shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the 350
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selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees in the premises herein leased.”
c. In contracts: There shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the land, nor shall the transferee itself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees of the land.”

12. Management Obligations.

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

13. Removal and Replacement of Property Manager.

Developer’s agreement with the Property Manager must provide that it is subject to termination by Developer without penalty, upon thirty (30) days prior written notice. Developer hereby covenants and agrees that, if the City determines in its reasonable judgment that the Project is not being operated and managed in accordance with the approved Management Plan, the City may deliver notice to the Developer of its determination that the Project’s management practices do not conform to the Management Plan (the “ City Notice ”), including a reasonably detailed explanation of such non-conformance. The City and Developer will meet and confer in good faith to identify actions to be taken by Developer to bring its management practices into conformance with the Management Plan, which could include replacing the Property Manager. Developer will have thirty (30) days after receipt of the City Notice (or such longer time as may be granted by the City) to either change its management practices to conform to the Management Plan or replace the Property Manager with a manager approved by the City and by all of Developer’s mortgagees.

Developer must promptly notify the City upon learning that there is a change in the management or control of the Property Manager, and, if the change is unsatisfactory to the City, it may require Developer to replace the Property Manager in accordance with the terms of this paragraph.

Notwithstanding the foregoing, if the City determines that the Property Manager has violated local, state, or federal campaign finance laws, it will have the right to require Developer to immediately remove and replace the Property Manager with a manager approved by the City.

14. Financial Reports.
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Developer will submit the following financial reports for the Project:
a. On or before the first day of each fiscal year, an estimated annual budget for management of the Property (the “ Annual Project Budget ”). The Annual Project Budget will include all necessary operating expenses, current maintenance charges, expenses of reasonable upkeep and repairs, taxes and special assessment levies, prorated amount required for insurance and all other expenses incident to the operation of the Project; and will show the expected revenues to pay such expenses, including annual debt service requirements and reserve fund deposits and balances. The Annual Project Budget, including any amendments proposed by the Developer, will be subject to the approval of the City Manager.
b. Sixty (60) days following the last day of each quarter of the fiscal year, beginning on the date of first occupancy, a quarterly report for the management of the Property (the “Quarterly Report”) during such quarter. The Quarterly Report will include a profit and loss statement, budget to date figures, and occupancy report. The Executive Director in his sole discretion may waive the requirement of the Quarterly Report for one or more quarterly reporting periods. However, such waiver will not operate to waive any future right of the City to require a subsequent Quarterly Report. If at any time the City determines that the Property is not being managed or maintained in accordance with the approved Management Plan, Developer will change its management personnel or the practices complained of, upon receipt of written notice from the City.
c. Developer will pay to City a late fee in the amount of $1,500 for each Annual Project Budget and/or Quarterly Report which is not submitted to the City within the times and in the form and substance required by this Agreement, which late fee shall accrue interest if not paid when and as due under this Agreement, from the date the fee is due until paid in full, at the highest non-usurious rate of interest then permitted by law, but in no event more than 10 %.

Notwithstanding any other provision of this Agreement, this provision shall be subject to a thirty (30) day notice and cure period.

15. Term of This Agreement.

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

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

17. Waiver.

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

18. Covenants Run With the Land.

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

19. Amendments.

This Agreement may be amended only by a written instrument executed by the parties hereto or their successors in title, and duly recorded in the Official Records of the County of Orange, State of California.

20. Notice.

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

21. Execution in Counterparts.

This Agreement may be executed by each party on a separate signature page, and when the executed signature pages are combined, will constitute one single instrument. 353
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[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the City and Developer have executed this Agreement. “CITY”
CITY OF ORANGE, a municipal corporation
of the State of California
By: ___________________
Mark A. Murphy, Mayor
ATTEST:
_______________________
Pamela Coleman, City Clerk
APPROVED AS TO FORM:

By:_______________________________
Gary A. Sheatz, City Attorney
[Signatures Continue on Next Page]
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“DEVELOPER”
Mercy Housing California 107, L.P.,
a California limited partnership
By: Mercy Housing California 107 LLC,
a California limited liability company,
its general partner
By: Mercy Housing Calwest,
a California nonprofit public benefit corporation, its
sole member/manager
By: ____________________________
Erika Villablanca,
Vice President
355

STATE OF CALIFORNIA )
)

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

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

WITNESS my hand and official seal.

Signature (Seal)
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. 356

STATE OF CALIFORNIA )
)

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

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

WITNESS my hand and official seal.

Signature (Seal)
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. 357

STATE OF CALIFORNIA )
)

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

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

WITNESS my hand and official seal.

Signature (Seal)
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. 358
480 South Batavia Street
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Exhibit A – Legal Description
Exhibit “A”

LEGAL DESCRIPTION
APN:
359
Villa St. Joseph – 480 South Batavia Street
Attachment No. [8] – HOME Regulatory Agreement