Agenda packet — Rocklin City Council, November 18, 2025 (part 5 of 7)

4811-0875-8641v12/200471-0009

EXHIBIT A

PORTION A SITE MAP
[to come]
787

Exhibit B

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EXHIBIT B

PORTION A SITE LEGAL DESCRIPTION

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF PLACER, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

[to come]

Assessor’s Parcel Number:

788

Exhibit C

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EXHIBIT C

MEMORANDUM OF LEASE

RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO (and mail tax
statement to):

City of Rocklin
3970 Rocklin Road
Rocklin, CA 95677
Attention: City Manager

Exempt from Recording Fee Pursuant to Government
Code Section 27383.

Documentary transfer tax: $
APNs: ________________________________

MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE (“Memorandum”) is hereby made and dated as of ___________ __, 202 _ by and between the CITY OF R OCKLIN, a municipal corporation (the “City”), and PACIFIC STREET HOUSING ASSOCIATES FOUR, L.P., a California limited partnership (the “Lessee” or “Developer”).

RECITALS
A. City and the Lessee have entered into an unrecorded ground lease dated as of ________ __, 202 _, for that certain parcel of real property (the “Property”) which is legally described in Addendum A attached hereto and incorporated herein by reference (the ground lease, as amended is hereafter referred to as the “Lease”). A copy of the Lease is on file as a public record with the City office at 3970 Rocklin Road, Rocklin, California. The term of the Lease is fifty-seven (57) years unless extended by action of Cit y; in the event any such extension is granted by City, the extension will be effective without regard to whether City causes to be recorded a modification of this Memoran dum.

The Lease implements that certain unrecorded agreement between City and Lessee entitled “Amended and Restated Affordable Housing Agreement” dated as of October __, 2025 (the “AHA”) ; a copy of the AHA is on file with the City office as a public record.

B. The Lease provides that a short form memorandum of the Lease shall be executed and recorded in the Official Records of Placer County, California.

C. The Lease includes restrictions which limit the rents chargeable, the incomes of renters, as more fully set forth in the Lease. The Lease includes an option to purchase by the City, as referenced in the Lease and the AHA.

D. The Lease provides that Lessee shall pay taxes upon the assessed value of the entire Property, and not merely a leasehold interest, as provided pursuant to Section 33673 of the California Health and Safety Code, to the extent such Section 33673 is applicable. 789

Exhibit C

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NOW, THEREFORE, the parties hereto certify as follows:

City, pursuant to the Lease, has leased the Property to the Lessee upon the terms and conditions provided for therein. This Memorandum of Lease is not a compl ete summary of the Lease and shall not be used to interpret the provisions of the Lease.

CITY

CITY OF ROCKLIN,
a municipal corporation
By:

Aly Zimmermann, City Manager
ATTEST:

Avinta Madhukansh-Singh, City Clerk

LESSEE

PACIFIC STREET HOUSING ASSOCIATES
FOUR, L.P., a California limited partnership
By: CHW Pacific Street Four LLC, its managing
general partner
By: Community HousingWorks, a California
nonprofit public benefit corporation (its sole member
and manager)
By: __________________________________
Kevin Leichner
Senior Vice President of Housing and Real Estate
Development

790

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

STATE OF CALIFORNIA )
) ss.

COUNTY OF ____________ )
On _____________________________ , before me, _______________________________ , Notary Public, (Print Name of Notary Public)
personally appeared

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

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

WITNESS my hand and official seal.

Signature of Notary Public

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

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

Signer is representing:

Name Of Person(s) Or Entity(ies)
________________________________ ___________________________ ________________________________ ___________________________ ________________________________ ___________________________ Number Of Pages
________________________________ ___________________________ Date Of Documents
________________________________ ___________________________ Signer(s) Other Than Named Above

791

4811-0875-8641v12/200471-0009
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

STATE OF CALIFORNIA )
) ss.

COUNTY OF ____________ )
On _____________________________ , before me, _______________________________ , Notary Public, (Print Name of Notary Public)
personally appeared

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

WITNESS my hand and official seal.

Signature of Notary Public

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

Signer is representing:

792

Addendum A

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ADDENDUM A

LEGAL DESCRIPTION

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF PLACER, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

[to come]

Assessor’s Parcel Number:

793

Exhibit D

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EXHIBIT D

CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
TO: City of Rocklin
3970 Rocklin Road
Rocklin, California 95677
Attention: City Manager
The undersigned, _______________, being duly authorized to execute this Certificate of Continuing Program Compliance (this “Certificate”) on behalf of [name to be conformed to Lease] [(the “Developer”)], hereby represents and warrants that:

1. He/she has read and is thoroughly familiar with the provisions of that certain agreement entitled “Affordable Housing Agreement” by and between the City of Rocklin (referred to herein as “City”) and the Developer dated as of [AHA Date] (the “ AHA”), including w ithout limitation the Regulatory Agreement, the City Lease, and other attachments thereto. Capitalized terms used herein shall have the same meaning as that set forth in the AHA; and

2. As of the date of this Certificate, the following number of completed residential units at the Portion A Site: (i) are currently occupied by Extremely Low Income Households at Affordable Rent; (ii) are currently occupied by Very Low Income Households at Affordable Rent; (iii) are currently occupied by Lower Income Househol ds at Affordable Rent; (i v) are currently vacant and being held available for occupancy by an Extremely Low Income Household at Affordable Rent; (v) are currently vacant and being held available for occupancy by a Very Low Income Household at Affordable Rent; (vi) are currently vacant and being held available for occupancy by a Lower Income Household and have been so held continuously since the date a Lower Income Household vacated such unit. Developer shall also delineate which Units are occupied by Local s by means of annotations to the categories set forth below (and/or the submittal of additional reports, which shall be based upon the same reporting period, and which designate income levels, and availability as well as occupancy by households within such category [namely, Locals]):

Occupied at an Affordable Rent by:
i. Extremely Low Income Households (30%) # of Units, Nos.:
ii. Very Low Income Households (50%) _______# of Units, Nos:
iii. Low Income Households (60%) # of Units, Nos.:

Vacant:
a. Held for occupancy by:
i. Extremely Low Income Households (30%) # of Units, Nos.:
ii. Very Low Income Households (50%) ________ # of Units, Nos.: ________________ iii. Lower Income Households (60%) # of Units, Nos.:

794

Exhibit D

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b. Last occupied by:
i. Extremely Low Income Households (30%) # of Units, Nos.:
ii. Very Low Income Households (50%) _________ # of Units, Nos.: ____________ ii. Lower Income Households (60%) # of Units, Nos.:

3. At no time since the date of filing of t he last Certification of Continuing Program Compliance have less than one hundred percent (100%) of the Required Affordable Units as completed units in the Project been occupied by, or been last occupied, or have been available for occupancy by Extremely Low Income Households, Very Low Income Households and/or Lower Income Households at an Affordable Rent.

4. The Developer is not in default under the terms of the AHA, including without limitation the attachments thereto (such as the City Lease and the City Regulatory Agreement). (DEVELOPER)

PACIFIC STREET HOUSING ASSOCIATES FOUR,
L.P., a California limited partnership
By: CHW Pacific Street Four LLC, its managing
general partner
By: Community HousingWorks, a California
nonprofit public benefit corporation (its sole member
and manager)
By: __________________________________
Kevin Leichner
Senior Vice President of Housing and Real Estate
Development

795

Exhibit E

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EXHIBIT E

GROUND LEASE RIDER
THIS GROUND LEASE RIDER (the “Rider”) is attached to and forms a part of that certain Ground Lease (the “Lease”) by and between the City of Rocklin, as lessor (the “Landlord”) and Pacific Street Housing Associates Four, L.P., a Californ ia limited partnership, as lessee (the “Tenant”). All capitalized terms used herein and not otherwise defined in this Rider shall have the meanings given that term in the Lease.

1. TENANT’S RIGHT TO MORTGAGE:

1.1 In addition to the Primary Construction Loan and the Primary Permanent Loan (which loans have been approved by Landlord prior to the commencement of the Term of the Lease), Tenant shall have the right, with Landlord’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed subject to Section 14 of the Lease, to mortgage the Lease and Tenant’s leasehold interest by one or more deeds of trust (each, together with the mortgages of the Primary Construction Loan and the Primary Pe rmanent Loan, a “Leasehold Mortgage”). Landlord shall base its review upon: (i) agreement by the new lender to be subject to the Lease, and the Regulatory Agreement to the same extent as the original (or, if applicable, subsequent) Approved Construction and/or Permanent Lender; (ii) agreement by the new lender to provide City with prior written notice and a reasonable opportunity to cure defaults; (iii) agreement by the new lender to provide City with the right to purchase from the lender such lender’s in terest in the event of foreclosure or deed of assignment in lieu of foreclosure for the outstanding amount of such loans as of foreclosure and such costs as such lender incurs in processing such foreclosure or deed or assignment in lieu of foreclosure; (iv) treatment of Cost Savings, if any, shall be in accordance with the AHA; (v) lender to be an Approved Permanent Lender; and (vi) the new loan will not reduce the debt service coverage below

1.15 to 1.00 or add additional bases for acceleration compared to the loan it replaces. No foreclosure (or deed or other transfer in lieu of foreclosure) under any Leasehold Mortgage shall require the consent of the Landlord under, or constitute a breach or default under, the Lease. In the event a Leasehold Mortgagee shall acquire title to Tenant’s leasehold interest by foreclosure (or deed or other transfer in lieu of foreclosure), such Leasehold Mortgagee may freely assign such leasehold interest to an assignee agreeing unconditionally to be bound by and be subject to the Lease as well as covenants of record as to the subject property after notice to but without the consent of Landlord, and thereupon Leasehold Mortgagee shall be released from all liability for performance or observance of the covenants and conditions in the Lease from and after the date of such assignment.

1.2 If Tenant shall mortgage the Lease and Tenant’s leasehold estate hereunder, then Tenant or the holder (each, a “Leasehold Mortgagee”) of such mortgage shall forward to Landlord:
(a) an executed c ounterpart of the mortgage or mortgages, in form proper for recording, or, at Tenant’s option, a true copy of such mortgage or mortgages; and (b) a written notice setting forth the name and address of the holder of such mortgage.
796

Exhibit E

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In the event of any assignment of the mortgage or mortgages held by a Leasehold Mortgagee, or change in its name and/or address, the assignee of the Leasehold Mortgagee shall give written notice thereof to Landlord, changing the name of the Leasehold Mortgagee and/or the address to which copies of notices are to be sent.

1.3 Until the time, if any, that each Leasehold Mortgage shall be satisfied of record, or each Leasehold Mortgagee shall give to Landlord written notice that the Leasehold Mortgage held by it has been satisfied:
a. no surrender or acceptance of the Property, or cancellation, termination, amendment or modification of the Lease, shall be binding upon any Leasehold Mortgagee, or affect any Leasehold Mortgage, if the same is effectuated without the prior written consent of such Leasehold Mortgagee;
b. if Landlord shall give any notice of default and/or termination to Tenant under the Lease, Landlord shall, at the same time and in the same manner, give a copy of such notice to each Leasehold Mortgagee at the respective address theretofore designated by each of them; and c. no notice of default and/or termination given by Landlord to Tenant shall be binding upon, or affect, any Leasehold Mortgagee, unless a copy of such notice shall be given to such Leasehold Mortgagee.

1.4 Each Leasehold Mortgagee shall be afforded the right, but not the obligation, to perform any term, covenant, or condition of the Lease to be performed by Tenant, as well as to remedy any default by Tenant hereunder, and Landlord shall accept such performan ce by any Leasehold Mortgagee with the same force and effect as if furnished by Tenant, provided, however, that the Leasehold Mortgagee shall not thereby or hereby be subrogated to the rights of Landlord. Additionally, Tenant may delegate irrevocably to any Leasehold Mortgagee(s) the authority to exercise any or all of Tenant’s rights hereunder, including, but not limited to the right of the Leasehold Mortgagee to participate (in conjunction with or to the exclusion of Tenant) in any proceeding, arbitratio n or settlement involving condemnation or eminent domain affecting Tenant’s leasehold interest in the Property, but no such delegation shall be binding upon Landlord unless and until either Tenant or the Leasehold Mortgagee in question shall give to Landlo rd a true copy of a written instrument effecting such delegation, in form required for recording. Such delegation of authority may be effected by the terms of a Leasehold Mortgage itself, in which event the service upon Landlord of an executed counterpart or certified copy of the Leasehold Mortgage in accordance with Section 2, together with a written notice specifying the provisions therein that delegate such authority to such Leasehold Mortgagee, shall be sufficient to give Landlord notice of such delegation. Any provision of the Lease that gives a Leasehold Mortgagee the privilege of exercising a particular right of Tenant hereunder on condition that Tenant shall have failed to exercise such right shall not be deemed to diminish any privilege that any Leasehold Mortgagee may have, by virtue of a delegation of authority from Tenant, to exercise such right without regard to whether or not Tenant shall have failed to exercise such right.

No foreclosure (or deed or other transfer of foreclosure) under any L easehold Mortgage shall require the consent of Landlord under, or constitute a breach or default under, the Lease. 797

Exhibit E

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1.5 If:
(a) Tenant shall default under the provisions of the Lease and Landlord shall give notice of such default as provided under the provisions of the Lease; (b) such default shall not be remedied within any applicable grace and/or cure period pursuant to the provisions of the Lease; and
(c) Landlord, by reason of such default, shall become entitled to (i) re-enter the Property or the improvemen t thereon, or (ii) terminate the Lease or (iii) bring a proceeding to dispossess Tenant and/or any other occupants of the Property or improvements thereon, re -enter the Property and/or improvements thereon and/or terminate the Lease, then, before so re -entering the Property or the improvements, terminating the Lease or commencing such proceeding, and as a condition precedent thereto, Landlord shall:
(x) give to each Leasehold Mortgagee not less than sixty (60) days additional written notice as to a monetary default (specifying the amount and description thereof to the extent then known to Landlord) or default in furnishing any insurance required to be furnished by Tenant hereunder, or ninety (90) days’ additional written notice of any non -monetary default (which shall specify in detail the nature of such default); and (y) allow each Leasehold Mortgagee:
(A) such sixty (60) days or ninety (90) days (as the case may be) within which to cure the default; or
(B) if such default is a non -monetary default (other t han a default in furnishing any insurance required to be furnished by Tenant hereunder) and cannot, with the exercise of due diligence, be cured by such Leasehold Mortgagee within such ninety (90) day period, then provided:
(i) prior to the expiration of s uch ninety (90) day period, such Leasehold Mortgagee has delivered to Landlord an instrument in writing duly executed and acknowledged wherein it agrees to use reasonable efforts to cure such default; and (ii) such default is susceptible of being cured by Leasehold Mortgagee without regard to whether Leasehold Mortgagee has possession of the Property and such Leasehold Mortgagee shall, prior to the expiration of such ninety (90) day period, have commenced curing such default, then such ninety (90) day perio d shall be extended, as long as such Leasehold Mortgagee diligently pursues the curing of such default with continuity, for such period as may be necessary to cure same provided that such period of time shall not be so extended if to do so would subject Landlord to any criminal or civil liability or the cancellation of any insurance required to be maintained by Tenant or the inability to obtain any such insurance.

Nothing herein contained shall affect the right of Landlord, upon occurrence of any subsequent default, to exercise any right or remedy herein reserved to Landlord, subject, however, to the provisions of this Section.
798

Exhibit E

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1.6 If:
(a) Tenant shall default in the performance or observance of any term, covenant, or condition of the Lease on Tenant’s part to be performed or observed, other than a term, covenant or condition requiring the payment of a sum of money; and
(b) such default is of such a nature that the same either:
(i) cannot practicably be cured by a Leasehold Mortgagee without taking possession of the Property and/or the improvements thereon; or (ii) is not susceptible of being cured by any Leasehold Mortgagee, then Landlord shall not:
(x) re-enter the Property and/or the improvements thereon or serve a notice of election to terminate the Lease;
(y) bring a proceeding to dispossess Tenant and/or any other occupants of the Property or the improvements, re-enter the Property and/or the improvements and/or terminate the Lease; or
(z) otherwise terminate the leasehold estate of Tenant hereunder, If, and for so long as:
(A) a Leasehold Mortgagee shall deliver to Landlord, prior to the date on which Landlord shall be entitled to give notice of election to terminate the Lease or re -enter the Property and/or the improvements, a written instrument, duly ex ecuted and acknowledged, in which the Leasehold Mortgagee agrees that:
(X) it will use reasonable efforts to cure such default to the extent the same is susceptible of being cured by the Leasehold Mortgagee, nominee or purchaser; and (Y) if the Lease thereafter is terminated, or Landlord thereafter re- enters the Property and/or the improvements prior to the curing of such default, the Leasehold Mortgagee shall pay to Landlord the cost of curing such default; and (B) if the default is of such a nature that same cannot practicably be cured by a Leasehold Mortgagee without taking possession of the Property and/or the improvements, a Leasehold Mortgagee shall proceed diligently, subject to any stay in any proceedings involving the insolvency of Tenant or any other proceeding, stay or injunction, to obtain possession of the Property and/or the improvements by foreclosure or deed in lieu of foreclosure, and, upon obtaining such possession, shall promptly cure such default; and
(C) if the default is of such a nature that the same is not susceptible of being cured by such Leasehold Mortgagee, a Leasehold Mortgagee shall institute foreclosure proceedings and diligently prosecute the same to completion, subject to any stay in any proceedings involving the insolvency of Tenant or other proceeding, stay or injunction (unless, in the meantime, the Leasehold 799

Exhibit E

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Mortgagee shall acquire Tenant’s estate hereunder, either in its own name or through a nominee, by assignment in lieu of foreclosure).

1.7 No Leasehold Mortgagee shall be required to continue to proceed to obtain possession, or to continue in possession as mortgagee, of the Property or the Improvements pursuant to subsection (b)(B) of Section 1.6 or to continue to prosecute foreclosure proceedings pursuant to subsection (b)(C) of Section 1.6 if and when Tenant’s default shall be cured. Nothing contained in Section 1.6 shall preclude Landlord from exercising any of its rights or remedies with respect to any other default by Tenant during any period of Landlord’s forbearanc e under Section 1.6 but, in such event, if any Leasehold Mortgagee, any nominee thereof, or any purchaser at a foreclosure sale shall:
(a) acquire title to Tenant’s leasehold estate hereunder; and (b) thereafter exercise reasonably diligent efforts to cure all non-monetary defaults of Tenant hereunder that are susceptible of being cured by such Leasehold Mortgagee, nominee or purchaser, as the case may be; the defaults of any prior holder of Tenant’s leasehold estate hereunder that are not susceptible of being cured by such Leasehold Mortgagee, nominee or purchaser exercising such efforts shall no longer be deemed to be defaults hereunder; and (c) If the initial construction of the Improvements on the Property is not yet complete, Leasehold Mortgagee or any purchaser at a foreclosure sale shall have thirty-six (36) months from the date of acquiring the Tenant’s leasehold estate to complete construction of the Development in accordance with the terms of this Lease.

1.8 If, for any reason, the Lease shall be terminated prior to the Expiration Date, Landlord will give each Leasehold Mortgagee written notice of such fact and shall also, on the written request of any Leasehold Mortgagee made within sixty (60) days of such termination (or, if later, within sixty (60) days after Landlord gives each Leasehold Mortgagee written notice of such termination), enter into a new lease of the Property with such Leasehold Mortgagee, within thirty (30) days after the receipt of such request, for the remainder of the term, effective as of the date of such termination, at the rent, and upon the other terms, covenants and conditions herein contained, subject, however, to the rights, if any, of the parties then in possession of any part of the Property, and provided that all then existing defaults shall be deemed cured.

In the event that more than one Leasehold Mortgagee qualifies to receive a new lease pursuant to the terms of this Section, such new lease shall be entered into with the holder of the Leasehold Mortgagee that is most senior in priority. Upon the execution and delivery of such new lease, any subleases that may have theretofore been assigned and transferred to Landlord shall thereupon be assigned and transferred, without recourse by Landlord, to the new tenant; and (a) after such termination and cancellation of the Lease and prior to the expiration of the period within which Leasehold Mortgagee may elect to obtain a new lease from Landlord, Landlord shall refrain from terminating any existing sublease or otherwise encum bering the Property without the prior written consent of Leasehold Mortgagee. Any new lease granted Leasehold Mortgagee shall be in the form substantially similar to the Lease and shall enjoy the same priority in time and in right as the Lease over any lien, encumbrance or other interest created by Landlord before or after the date of such new lease and shall vest in Leasehold Mortgagee all right, title, interest, power and privileges of Tenant hereunder in and to the Property, including, without limitation, the assignment 800

Exhibit E

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of Tenant’s interest in and to all then existing subleases and sublease rentals and the automatic vesting of title to all Improvements, fixtures and personal property of Lessee in Leasehold Mortgagee. Such new lease shall provide, with respect to each and every permitted sublease which immediately prior to the termination of the Lease was superior to the lien of the Leasehold Mortgagee that Leasehold Mortgagee shall be deemed to have recognized the sublessee under the sublease, pursuant to the terms of the sublease as though the sublease had never terminated but had continued in full force and effect after the termination of the Lease, and to have assumed all the obligations of the sublessor under the sublease accruing from and after the t ermination of the Lease, except that the obligation of the new lessee, as sublessor, under any covenant of quiet enjoyment, expressed or implied, contained in any such sublease shall be limited to the acts of such new lessee and those claiming by, under or through such new lessee.

1.9 The rights hereunder of the Leasehold Mortgagees shall be exercisable by them in order of priority of lien of their respective Leasehold Mortgages. The liability of any Leasehold Mortgagee acquiring Tenant’s interest hereunder shall be limited to such Leasehold Mortgagee’s then interest in the Property.

1.10 No Leasehold Mortgagee shall be liable, as tenant, under the provisions of the Lease unless and until such time as it becomes, and then only for as long as it remains, the owner of Tenant’s interest hereunder.

1.11 Notwithstanding anything to the contrary contained in the Lease, all proceeds arising from any casualty insurance, business interruption insurance, rental loss insurance or similar insurance policy relating to th e Property and/or any improvements now or hereafter located thereon, and all proceeds of any award or payment made in connection with any condemnation or eminent domain proceeding (or deed or other transfer under threat of the same or in lieu thereof) invo lving all or any part of the Property and/or any improvements now or hereafter located thereon, shall be paid to the Leasehold Mortgagees for application in accordance with their respective Leasehold Mortgages.

1.12 Landlord shall, within thirty (30) days after the written request of any Leasehold Mortgagee:
(a) acknowledge in writing to them, or to any of them, the receipt by Landlord of any notice or instrument given, sent, or delivered to Landlord pursuant to the provisions of this Article; and/or
(b) furnish to them, or to any of them, a written statement, duly acknowledged, of the following items:
(i) the amount of net rental due, if any, and amounts due in connection with the failure by Lessee to satisfy the Ancillary Duties or any other provisions of this Lease; (ii) whether the fire and other insurance required by the Lease have been supplied in compliance therewith;
(iii) whether the Lease is unmodified and in full force and effect (or, if there have been modifications, that the same are in full forc e and effect as modified and stating the modifications);
801

Exhibit E

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(iv) whether, to the best knowledge and belief of Landlord, Tenant is in default, specifying the nature of any known default and any pertinent facts with respect thereto; (v) whether Landlord has giv en Tenant any notice of default under the lease, and if given, whether the default set forth therein remains uncured; and (vi) such other matters as the Leasehold Mortgagee may reasonably request.

Any such statement shall be for the sole benefit of the Leasehold Mortgagee and shall have no effect, as an estoppel or otherwise, with respect to any third party.

2. Notwithstanding anything to the contrary contained elsewhere herein, upon the acquisition by any Leasehold Mortgagee of leasehold title to the Prope rty, whether by foreclosure, deed in lieu of foreclosure, acceptance of a new lease pursuant to the terms of the Lease or otherwise, (i) the obligation to pay past due rent under the Lease (or any such new lease) and to pay any other amounts then due by th e original Tenant, shall irrevocably terminate, excepting only in the event [to come: Lessee], CHW, or an Affiliated Person other than an Approved Construction and/or Permanent Lender shall become owner of the Portion A Site (whether of a leasehold or greater interest) in which event rent will be restored to the rent set forth in Section 5.1 of the Lease and (ii) rent shall be payable prospectively in the manner and at the amounts determined under the Lease.

3. Notwithstanding anything to the contrary set forth in this Lease, commencing upon the completion of a Foreclosure Event and continuing for the remainder of the Term hereof, but expressly subject to compliance with the Regulatory Agreement, Tenant shall only be required to make available, restrict occupancy to, and rent all of the Required Affordable Units to Lower Income Households at Affordable Rent; provided that the for egoing portion of this Section 3 shall cease to be effective and the Affordability Requirements shall be restored to effectiveness in the manner originally set forth as to the Prescribed Income Levels in the event [to come], CHW or a n Affiliated Person oth er than an Approved Construction and/or Permanent Lender shall become owner of the Portion A Site (whether of a leasehold or greater interest).
802

Exhibit F

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EXHIBIT F
Insurance During Construction
Lessee shall procure or provide evidence to confirm that Lessee or contractor(s) has procured and will maintain for the duration of the contract, and for 5 years thereafter [City will review insurance requirements as part of review of the Proof of Financing Commitments], insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by the Lessee and/or Lessee’s contractor, his agents, representatives, employees, or subcontractors.

MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:

1. Commercial General Liability (CGL): Insurance Services Office (ISO) Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $5,000,000 per occurrence. Such limits may be achieved through the combination of primary general lability and one or more umbrella/excess liability policy(ies).

2. Automobile Liability: Insurance Services Office Form CA 0001 covering all owned (if any), non-owned and hired automobiles, with limits no less than $5,000,000 per accident for bodily injury and property damage. Such limits may be achieved through the combination of primary general liability and one or more umbrella/excess liability policy(ies).

3. Workers’ Compensation insurance as required by the State of California, with Statutory Limits, and Employers’ Liability insurance with a limit of no less than $1,000,000 per accident for bodily injury or disease.

4. Builder’s Risk (Course of Construction) insurance utilizing an “All Risk” (Special Perils) coverage form, with limits equal to the completed value of the project and no coinsurance penalty provisions.

5. Surety Bonds as described below.

6. Professional Liability (if Design/Build), with limits no less than $2,000,000 per occurrence or claim, and $2,000,000 policy aggregate. This coverage is to be provided by the architec t and/or design-build general contractor providing such professional services

7. Contractors’ Pollution Liability and/or Asbestos Legal Liability (if project involves environmental hazards) with limits no less than $1,000,000 per occurrence or claim, and $2,000,000 policy aggregate. This coverage may be provided by the general contractor.

If the Lessee or contractor maintains broader coverage and/or higher limits than the minimums shown above, the City requires and shall be entitled to the broader coverage and/or the higher limits maintained by the either. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City.

Self-Insured Retentions
Self-insured retentions must be declared to and approved by the City. The City may require the Lessee or contractor to purchase coverage with a lower retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention.

The policy language shall provide, or be endorsed to provide, that the self-insured retention may be 803

Exhibit F

Page 2 of 4 ends

satisfied by either the named insured or City. The CGL and any policies, including Excess liability policies, may not be subject to a self-insured retention (SIR) or deductible that exceeds $100,000 unless approved in writing by City. Any and all deductibles and SIRs shall be the sole responsibility of Lessee or contractor or subcontractor who procured such insurance and shall not apply to the Indemnified Additional Insured Parties. City may deduct from any amounts otherwise due Lessee or contractor to fund the SIR/deductible. Policies shall NOT contain any self-insured retention (SIR) provision that limits the satisfaction of the SIR to the Named Insured. The policy must also provide that Defense costs, including the Allocated Loss Adjustment Expenses, will satisfy the SIR or deductible. City reserves the right to obtain a copy of any policies and endorsements for verification.

Other Insurance Provisions
The insurance policies are to contain, or be endorsed to contain, the following provisions:

1. The City, its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Lessee or contractor including materials, parts, or equipment furnished in connection with such work or operations and automobiles owned, leased, hired , or borrowed by or on behalf of the Lessee or contractor. General liability coverage can be provided in the form of an endorsement to the Lessee or contractor’s insurance (at least as broad as ISO Form CG 20 10, CG 11 85 or both CG 20 10, CG 20 26, CG 20 33, or CG 2 0 38; and CG 20 37 forms if later revisions used).

2. For any claims related to this project, the Lessee or contractor’s insurance coverage shall be primary and non-contributory insurance coverage at least as broad as ISO CG 20 01 04 13 as respects the City, its officers, officials, employees, and volunteers. Any insurance or self- insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Lessee or contractor’s insurance and shall not contribute with it. This requirement shall also apply to any Excess or Umbrella liability policies.

3. Each insurance policy required by this clause shall provide that coverage shall not be canceled, except with notice to the City.

Builder’s Risk (Course of Construction) Insurance
Lessee or contractor may submit evidence of Builder’s Risk insurance in the form of Course of Construction coverage. Such coverage shall name the City as a loss payee as their interest may appear.

Claims Made Policies
If any coverage required is written on a claims-made coverage form:

1. The retroactive date must be shown, and this date must be before the execution date of the contract or the beginning of contract work.

2. Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of contract work.

3. If coverage is cance lled or non -renewed, and not replaced with another claims -made policy form with a retroactive date prior to the contract effective, or start of work date, the Lessee or contractor must purchase extended reporting period coverage for a minimum of five (5) years after completion of contract work.

4. A copy of the claims reporting requirements must be submitted to the City for review. 804

Exhibit F

Page 3 of 4 ends

5. If the services involve lead-based paint or asbestos identification/remediation, the Lessee or contractors Pollution Liability policy shall not contain lead-based paint or asbestos exclusions.

If the services involve mold identification/remediation, the Lessee or contractor s Poll ution Liability policy shall not contain a mold exclusion, and the definition of Pollution shall include microbial matter, including mold.

Umbrella or Excess Policies
The Lessee or contractor may use Umbrella or Excess Policies to provide the liability limits as required in this agreement. This form of insurance will be acceptable provided that all of the Primary and Umbrella or Excess Policies shall provide all of the insurance coverages herein required, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The Umbrella or Excess policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying Commercial General Liability insurance. No insurance policies maintained by the Additional Insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Lessee or contractor’s primary and excess liability policies are exhausted.

Acceptability of Insurers
Insurance is to be placed with insurers approved to conduct business in the state with a current A.M.

Best rating of no less than A: VII, unless otherwise acceptable to the City.

Waiver of Subrogation
Lessee or contractor hereby agrees to waive rights of subrogation which any insurer of Lessee or contractor may acquire from Lessee or contractor by virtue of the payment of any loss. Lessee or contractor agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation. The Workers’ Compensation policy shall be endorsed with a waiver of subrogation in favor of the City for all work performed by the Lessee or contractor, its employees, agents and subcontractors or contractors.

Verification of Coverage
Lessee or contractor shall furnish the City with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause and a copy of the Declarations and Endorsements Pages of the CGL and any Excess policies listing all policy endorsements. All certificates and endorsements and copies of the Declarations & Endorsements pages are to be received and approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Lessee or contractor’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

Subcontractors
Lessee or contractor shall require and verify that all subcontractors maintain insurance meeting all requirements stated herein, and Lessee or contractor shall ensure that City is an additional insured on insurance required from subcontractors. For CGL coverage, subcontractors or contractors shall provide coverage with a form at least as broad as CG 20 38 04 13.

Duration of Coverage
CGL & Excess liability policies for any construction related work, including, but not limited to, maintenance, service, or repair work, shall continue coverage for a minimum of 5 years for Completed Operations liability coverage. Such Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work. 805

Exhibit F

Page 4 of 4 ends

Surety Bonds
Lessee or contractor shall provide the following Surety Bonds:

1. Performance Bond

2. Payment Bond

3. Maintenance Bond
The Payment Bond and the Performance Bond shall be in a sum equal to the contract price. If the Performance Bond provides for a one-year warranty a separate Maintenance Bond is not necessary.

If the warranty period specified in the contract is for longer than one year a M aintenance Bond equal to 10% of the contract price is required. Bonds shall be duly executed by a responsible corporate surety, approved to issue such bonds in the State of California and secured through an authorized agent with an office in California.

Special Risks or Circumstances
City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other circumstances. 806

Exhibit G

Page 1 of 2 ends

EXHIBIT G
Insurance During Remainder of Lease Term
Lessee shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the Lessee’s operation and use of the leased premises. The cost of such insurance shall be borne by the Lessee. [City will review insurance requirements as part of review of the Proof of Financing Commitments].

MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:

1. Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limit s no less than $2,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO CG 25 03 or 25 04) or the general aggregate limit shall be twice the required occurrence limit.

2. Workers’ Compensation insurance as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance with limits of no less than $1,000,000 per accident for bodily injury or disease. (This applies to lessees with employees).

3. Property insurance against risks of loss (ISO “Special Form” perils) to any tenant improvements or betterments, at full replacement cost with no coinsurance penalty provision.

If the Lessee maintains broader coverage and/or higher limits than the minimums shown above, the City requires and shall be entitled to the broader coverage and/or the higher limits maintained by the Lessee.

Other Insurance Provisions
The insurance policies are to contain, or be endorsed to contain, the following provisions:

Additional Insured Status
The City, its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Contractor including materials, parts, or equipment furnished in connection with such work or operations. General liability coverage can be provided in the form of an endorsement to the Contractor’s insurance (at least as broad as ISO Form CG 20 10 11 85 or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 if a later edition is used).

Primary Coverage
For any claims related to this contract, the Lessee’s insurance coverage shall be primary and non- contributory and at least as broad as ISO CG 20 01 04 13 as respects the City, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees, or volunteers shall be excess of the Lessee’s insurance and shall not contribute with it. This requirement shall also apply to any Excess or Umbrella liability policies. 807

Exhibit G

Page 2 of 2 ends

Notice of Cancellation
Each insurance policy required above shall provide that coverage shall not be canceled, except with notice to the City.

Waiver of Subrogation
Lessee hereby grants to City a waiver of any right to subrogation which any insurer of said Lessee may acquire against the City by virtue of the payment of any loss under such insurance. Lessee agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer.

Self-Insured Retentions
Self-insured retentions must be declared to and approved by the City. The City may require the Lessee to purchase coverage with a lower retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City. The CGL and any policies, including Excess liability policies, may not be subject to a self-insured retention (SIR) or deductible that exceeds $100,000 unless approved in writing by City. Any and all deductibles and SIRs shall be the sole responsibility of Lessee who procured such insurance and shall not apply to the Indemnified Additional Insured Parties. City may deduct from any amounts otherwise due Lessee to fund the SIR/deductible. Policies shall NOT contain any self-insured retention (SIR) provision that limits the satisfaction of the SIR to the Named. The policy must also provide that Defense costs, including the Allocated Loss Adjustment Expenses, will satisfy the SIR or deductible. City reserves the right to obtain a copy of any policies and endorsements for verification.

Acceptability of Insurers
Insurance is to be placed with insurers approved to conduct business in the state with a current A.M.

Best’s rating of no less than A:VII, unless otherwise acceptable to the City.

Verification of Coverage
Lessee shall furnish the City with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause and a copy of the Declarations and Endorsements Pages of the CGL and any Excess policies listing all policy endorsements. All certificates and endorsements and copies of the Declarations & Endorsements pages are to be received and approved by the City before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Lessee’s obligation to provide them. The City reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time. City reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

Exhibit H

Page 1 ends

EXHIBIT H
Map of the Adjacent City Parking Area

809

Exhibit I

Page 1 ends

EXHIBIT I
Map of the Portion B Area

810

CITY OF ROCKLIN
RESOLUTION NO. 2025-___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ROCKLIN APPROVING AN

AFFORDABLE HOUSING AGREEMENT BY AND BETWEEN THE CITY AND PACIFIC STREET HOUSING ASSOCIATES NINE, L.P., A CALIFORNIA LIMITED PARTNERSHIP

WHEREAS, the City of Rocklin ("City") previously established a redevelopment agency within the corporate limits of the City, which redevelopment agency was known as the "Rockli n Redevelopment Agency" (the "Former Agency"); and
WHEREAS, in connection with the exercise of its public functions, including utilizing certain revenues of the Former Agency to promote affordable housing, the Former Agency established and maintained a low and moderate income housing fund (the "LMIHF"); and WHEREAS, the State of California eliminated all redevelopment agencies within the State, including without limitation the Former Agency. In connection with activities related to the dissolution of the Former Agency, the City was designated as the housing successor entity to the Former Agency related to affordable housing; the City received the LMIHF moneys as well as certain land which had been acquired by the Fonner Agency, including without limitation certain land located generally at Pacific, Oak and Pine, and is more particularly described in the "Affordable Housing Agreement" as defined below; that property is referred to herein as the "Original Property"; and
WHEREAS, the City has desired to attract an experienced developer and operator of affordable rental housing to accomplish the development of the Original Property for affordable rental housing; and
WHEREAS, as part of the efforts of the City with regard to the Original Property, the City issued a notice of availability as to the Original Property and conducted further efforts in furtherance of California laws and regulations pertaining to the disposition of surplus property; and
WHEREAS, after various proposals were evaluated, the City identified Community HousingWorks, a California nonprofit public benefit corporation (" CHW") as the respondent with the highest number of proposed units and deepest levels of affordability, and staff entered into negotiations toward an agreement p roviding for the disposition of the Original Property and its operation for affordable rental housing purposes; and WHEREAS, the City and CHW entered into an agreement entitled “Affordable Housing Agreement”, dated as of November 8, 2022 (the “Original Agr eement”) under which it was contemplated that the City would ground lease the Original Property to CHW or one or more subsidiaries of CHW upon which the construction of improvements dedicated to affordable rental housing to households of limited income wil l be accomplished on the Original Property. 811

The Original Agreement included a commitment of certain moneys previously committed by the City as such commitment was made by letter in May of 2022 (the “Original Funding Commitment”); and
WHEREAS, subsequent to entering into the Original Agreement, CHW provided a proposal under which property generally conforming to the Original Property would be divided into two portions, an approximately 0.42 acre parcel (the “Portion A Site”) and a second area comprised of approximately 2.51 acres (the “Portion B Area”). CHW created two separate entities, with the first (Pacific Street Housing Associates Four, L.P., a California limited partnership [herein the “9% Developer ”]) to develop an affordable housing project on the Portion A Site, and a second entity (Pacific Street Housing Associates Nine, L.P., a California limited partnership [herein, the “9% Developer”]) to develop the Portion B Area; and WHEREAS, under the Original Agreement, it was contemplated that CHW would apply for and secure a commitment of federal low income housing tax credits (“Tax Credits”) for each of the Portion A Site and the Portion B Area; and
WHEREAS, the 9% Developer has proposed to City to enter into an agreement with City entitled “Affordable Housing Agreement” (the “ 9% Agreement”) in the form submitted herewith; and
WHEREAS, under the 9% Agreement, the 9% Developer would construct improvements referenced in the 9% Agreement (including without limitation all requirements under land use approvals by City (whether made heretofore or hereafter) and to construct fifty (50) rental housing units thereon, all of which would be restricted to households of limited income as more particularly set forth in the 9% Agreement; and
WHEREAS, the 9% Agreement furthers the affordable housing goals of the Former Agency as well as the affordable housing goals of the City as it will facilitate the creation of affordable rental housing; and
WHEREAS, the Legislature declares in Health and Safety Code Section 36000, et seq., that new forms of cooperation with the private sector, such as leased housing, disposition of real property acquired through redevelopment, development approvals, and other forms of housing assistance may involve close participation with the private s ector in meeting housing needs, without amounting to development, construction or acquisition of low rent housing projects as contemplated under Article XXXIV of the State Constitution; and WHEREAS, Health and Safety Code Section 37001.5 provides that a public body does not develop, construct or acquire a low rent housing project under Article XXXIV of the State Constitution when the public body provides assistance to a low rent housing project and monitors construction or rehabilitation of the project to the extent of carrying out routine governmental functions, performing conventional activities of a lender, and imposing constitutionally mandated or statutorily authorized c onditions accepted by a grantee of assistance; and
812

WHEREAS, under the 9% Agreement, the City would ground lease the Portion B Area to the 9% Developer , would act as the local land use authority, and would impose restrictions on incomes and rents consistent with the requirements of the sources of the funding that will be utilized by the City; and
WHEREAS, the 9% Agreement provides for the City's monitoring of construction of the Project to the extent of carrying out routine governmental functions, performing conventional activities of a lender, and imposing constitutionally mandated or statutorily authorized conditions accepted by a grantee of assistance; and

WHEREAS, subsequent to the approval of the Original Agreement, State law has been amended to the effect that affordable housing projects funded in whole or in part using Tax Credits are exempt from the requirement of obtaining Article XXXIV approval; and WHEREAS, under the 9% Agreement, the 9% Developer shall lease the Portion B Area from the City at rent described in a report to the City and City Council concerning the 9% Agreement (the "Report"); the Report, which has been on file with the City Clerk prior to the meeting at which the 9% Agreement is to be considered, contains information similar to that described in Section 33433 of the California Health and Safety Code. The financial participation, if any, by the City under the 9% Agreement (including the ground leasing of the Portion B Area at the rental rate provided therein) is in consideration of the particular uses required by the 9% Agreement to be conducted by the 9% Developer on the Portion B Area as well as the 9% Developer's undertakings concerning the development and operation of improvements for affordable rental housing; and
WHEREAS, the City, as a municipal corporation and as a housing successor entity, 1s authorized to ground lease the Portion B Area on the basis described herein; and WHEREAS, a public hearing of the City Council on the proposed Agreement was duly noticed substantially in the manner described at Health and Safety Code Sections 33431 and 33433; and
WHEREAS, the proposed 9% Agreement , and a summary report were available for public inspection prior to the public hearing; and
WHEREAS, on November 18 , 2025 , the City Council held a public hearing on the proposed 9% Agreement , at which time the City Council reviewed and evaluated all of the information, testimony, and evidence presented during the public hearing; and WHEREAS, all actions required by all applicable law with respect to the proposed Agreement have been taken in an appropriate and timely manner; and WHEREAS, the California Environmental Quality Act (Section 21000, et. seq. of the California Public Resources Code, hereafter "CEQA") requires an alysis of agency approvals of discretionary "projects". Under Section 15378 of the California Code of Regulations, Title 14, 813

Division 6, Chapter 3 (“CEQA Guidelines"), a "project" may include "the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment"; and WHEREAS, City staff has reviewed the proposed 9% Agreement in relation to the provisions of the California Environmental Quality Act (CEQA) and has determined that the approval of the 9% Agreement is exempt from additional environmental processing at this time in view of the rationale provided below; and
WHEREAS, the City Council ha ve duly considered all of the terms and conditions of the proposed Agreement and believes that the development of the Portion B Area pursuant to the 9% Agreement is in the best interests of the City of Rocklin and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF ROCKLIN DOES RESOLVE AS FOLLOWS:

Section 1. The proposed 9% Agreement is not subject to review under CEQA pursuant to CEQA Guidelines Sections 15060(c)(2) and 15061 (b)(3) of the California Does of Regulations, Title 14, Division 6, Chapter 3 ("CEQA Guidelines") as the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment and there is no possibility the activity in question may have a significant effect on the environment.

Section 2. The City Council hereby determines that the assistance to be provided pursuant to the 9% Agreement does not constitute development, construction or acquisition of a low -rent housing project within the meaning of Article XXXIV of the State Constitution. This Resolution is hereby deemed to constitute a final approval of a proposal which may result in housing assistance benefiting persons of low income, within the meaning of Health and Safety Code Section 36005 in the event an exemption based upon use of Tax Credits in funding a housing project is for any reason inapplicable.

The City Council hereby determines, in the alternative, that the proposed project is exempt from the application of Article XXXIV based upon the circumstances that the proposed project is to be funded in whole or in part utilizing Tax Credits.

Section 3. The City Council f inds and determines that, based upon substantial evidence provided in the record before it, the consideration for the City's disposition of the Portion B Area by ground lease pursuant to the terms and conditions of the 9% Agreement is not less than the fair reuse (lease) value at the use and with the covenants and conditions and development costs authorized by the 9% Agreement.

Section 4. The City Council finds and determines that the statements set forth in the preceding Recitals hereof are true and correct.

Section 5 . The City Council approves the 9% Agreement in substantially the 814

form presented to the City Council, subject to such revisions as may be made by the City Manager of the City or the City Manager's designee. A copy of the 9% Agreement when executed by the City shall be placed on file in the office of the City Clerk.

Section 6. The City Manager, or the City Manager's designee, is hereby authorized to execute the 9% Agreement as well as instruments necessary or convenient to implement its terms, and to approve all financial transactions, budgets, and appropriations needed to carry out the financing in connection with the 9% Agreement in accordance with the law and City policy.

815

APPROVED AND ADOPTED this 18th day of November, 2025.

By:

Avinta Singh, City Clerk

STATE OF CALIFORNIA )

COUNTY OF PLACER )

CITY OF ROCKLIN )

I, Avinta Singh, City Clerk of the City of Rocklin, do hereby certify that the foregoing Resolution No. 2025-___ was introduced and adopted at a regular meeting provided by law of the City Council of the City of Rocklin held on the 18th day of November, 2025, by the following vote of the members thereof:

AYES:

NOES:

ABSENT:

ABSTAIN:

816

Rocklin CHW Portion B, v3

AFFORDABLE HOUSING AGREEMENT
by and between the

CITY OF ROCKLIN
and
PACIFIC STREET HOUSING ASSOCIATES NINE, L.P.,
a California limited partnership

(Portion B Area: 9% Tax Credits)

817

i
Rocklin CHW Portion B, v3

TABLE OF CONTENTS
Page

1. DEFINITIONS AND INTERPRETATION .............................................................................. 2

1.1 Defined Terms .............................................................................................................. 2

1.2 Singular and Plural Terms .......................................................................................... 14

1.3 References and Other Terms ....................................................................................... 14

1.4 Exhibits Incorporated .................................................................................................. 14

1.5 Representations and Warranties .................................................................................. 14

1.6 Condition of the Portion B Area ................................................................................. 16

2. THE PORTION B AREA, SCOPE OF DEVELOPMENT AND SCHEDULE OF PERFORMANCE.................................................................................................................... 19

2.1 The Portion B Area ..................................................................................................... 19

2.2 Scope of Development ................................................................................................ 19

3. DISPOSITION OF THE PORTION A SITE .......................................................................... 19

3.1 Tentative Map and Final Map ..................................................................................... 19

3.2 Lease of the Portion of the Portion B Area ................................................................. 20

3.3 Escrow ......................................................................................................................... 20

3.4 Review of Title ........................................................................................................... 22

3.5 Title Insurance ............................................................................................................ 23

3.6 Financing Package ...................................................................................................... 23

4. CONDITIONS TO DEVELOPER POSSESSION OF THE PORTION A SITE ................... 23

4.1 City Conditions Precedent .......................................................................................... 23

4.2 Developer Conditions Precedent ................................................................................. 25

5. SCOPE OF DEVELOPMENT; INSURANCE AND INDEMNITY, FINANCING .............. 26

5.1 Scope of Development ................................................................................................ 26

5.2 Time of Performance; Progress Reports ..................................................................... 27

5.3 Cost of Development .................................................................................................. 28

5.4 [RESERVED] ............................................................................................................. 28

5.5 Insurance Requirements .............................................................................................. 28

5.6 Obligation to Repair and Restore Damage Due to Casualty ....................................... 28

5.7 Indemnity .................................................................................................................... 29

5.8 Rights of Access ......................................................................................................... 30

5.9 Compliance With Laws ............................................................................................... 30

5.10 Nondiscrimination in Employment ............................................................................. 31

5.11 Taxes and Assessments ............................................................................................... 31

5.12 Liens and Stop Notices ............................................................................................... 31

5.13 Certificate of Completion ........................................................................................... 32

5.14 Further Assurances ...................................................................................................... 32

5.15 Financing of the Improvements .................................................................................. 32

5.16 Holder Not Obligated to Construct Improvements ..................................................... 38

5.17 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure ................. 38

5.18 Failure of Holder to Complete Improvements ............................................................ 38

5.19 Right of City to Cure Mortgage or Deed of Trust Default .......................................... 39 818

ii
Rocklin CHW Portion B, v3

6. COVENANTS AND RESTRICTIONS .................................................................................. 39

6.1 Use Covenants ............................................................................................................ 39

6.2 Affordable Housing Requirements ............................................................................. 40

6.3 [Reserved] ................................................................................................................... 43

6.4 Maintenance of the Portion B Area............................................................................. 43

6.5 Nondiscrimination Covenants ..................................................................................... 43

6.6 Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction ........................................................................................ 44

7. DEVELOPER’S GENERAL REPRESENTATIONS AND WARRANTIES ........................ 45

7.1 Formation, Qualification and Compliance .................................................................. 45

7.2 Execution and Performance of Project Documents .................................................... 45

7.3 Covenant Not to Transfer Except in Conformity ........................................................ 45

8. DEFAULTS, REMEDIES, AND TERMINATION ............................................................... 46

8.1 Default Remedies ........................................................................................................ 46

8.2 Institution of Legal Actions ........................................................................................ 46

8.3 Termination by Developer .......................................................................................... 46

8.4 Termination by City .................................................................................................... 47

8.5 Acceptance of Service of Process ............................................................................... 47

8.6 Rights and Remedies Are Cumulative ........................................................................ 48

8.7 Inaction Not a Waiver of Default ................................................................................ 48

8.8 Applicable Law ........................................................................................................... 48

8.9 Covenant Provisions; Certain Amendments ............................................................... 48

8.10 Enforced Delay; Extension of Times of Performance ................................................ 48

8.11 Transfers of Interest in Agreement or of the Portion B Area ...................................... 49

8.12 Non-Liability of Officials and Employees of City ...................................................... 50

8.13 Relationship Between City and Developer ................................................................. 50

8.14 City Approvals and Actions ........................................................................................ 51

8.15 Real Estate Brokers ..................................................................................................... 51

8.16 Attorneys’ Fees ........................................................................................................... 51

8.17 Non-recourse Liability of Developer .......................................................................... 51

9. MISCELLANEOUS ................................................................................................................ 51

9.1 Obligations Unconditional and Independent............................................................... 51

9.2 Notices ........................................................................................................................ 51

9.3 Survival of Representations and Warranties ............................................................... 52

9.4 No Third Parties Benefited Except for City; AB 987 ................................................. 53

9.5 Binding Effect; Assignment of Obligations ............................................................... 53

9.6 Option ......................................................................................................................... 53

9.7 Mandatory Assignment ............................................................................................... 55

9.8 Counterparts ................................................................................................................ 55

9.9 Prior Agreements; Amendments; Consents ................................................................ 55

9.10 Governing Law ........................................................................................................... 56

9.11 Severability of Provisions ........................................................................................... 56

9.12 Headings ..................................................................................................................... 56

9.13 Conflicts ...................................................................................................................... 56

9.14 Time of the Essence .................................................................................................... 56

9.15 Conflict of Interest ...................................................................................................... 56 819

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Rocklin CHW Portion B, v3

9.16 Cure by Limited Partner .............................................................................................. 56

9.17 Warranty Against Payment of Consideration ............................................................. 57

ATTACHMENTS
ATTACHMENT NO. 1 THE PORTION B AREA MAP
ATTACHMENT NO. 2 LEGAL DESCRIPTION OF THE PORTION B AREA ATTACHMENT NO. 3 SCHEDULE OF PERFORMANCE
ATTACHMENT NO. 4 CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE ATTACHMENT NO. 5 NOTICE OF AFFORDABILITY RESTRICTIONS
ATTACHMENT NO. 6 CITY LEASE
ATTACHMENT NO. 7 CALCULATION OF AFFORDABLE RENTS
ATTACHMENT NO. 8 REQUEST FOR NOTICE OF DEFAULT
ATTACHMENT NO. 9 SCOPE OF DEVELOPMENT
ATTACHMENT NO. 10 CERTIFICATE OF COMPLETION
ATTACHMENT NO. 11 CITY REGULATORY AGREEMENT
ATTACHMENT NO. 12 INCOME VERIFICATION
ATTACHMENT NO. 13 [RESERVED]
ATTACHMENT NO. 14 [RESERVED]
ATTACHMENT NO. 15 INSURANCE DURING REMAINDER OF LEASE TERM ATTACHMENT NO. 16 INSURANCE DURING CONSTRUCTION
ATTACHMENT NO. 17 MAP OF THE PORTION A SITE
ATTACHMENT NO. 18 MAP OF THE ADJACENT CITY PARKING AREA

820

Rocklin CHW Portion B, v3

AFFORDABLE

HOUSING AGREEMENT
This AFFORDABLE HOUSING AGREEMENT (the “Agreement”), dated, for identification purposes only, as of ________ __, 2025 (the “Date of Agreement”), is entered into by and between the CITY OF ROCKLIN, a municipal corporation (“City”), and PACIFIC STREET HOUSING ASSOCIATES NINE, L.P., a California limited partnership (“Developer”).

R E C I T A L S
A. City, as part of its functions as a general law city duly organized and existing under and by virtue of the laws of the State of California and in connection with its municipal code (the “City Code”), is authorized to promote the provision of affordable housing for all income segments of the community. Pursuant to the City Code and resolutions adopted pursuant thereto, City is authorized to defer receipt of all or a portion of its development impact fees chargeable in relation to various projects.

City is authorized to enter into agreements in connection therewith.

B. City previously activated the Rocklin Redevelopment Agency, a public body, corporate and politic (the “Redevelopment Agency”); the Redevelopment Agency operated under the California Redevelopment Law, Part 1 of Division 24 of the Health and Safety Code (the “Redevelopment Law”).

C. City is the housing successor entity to the Redevelopment Agency and in such capacity acquired the “Portion B Area” (as defined below) in connection with the dissolution of the Redevelopment Agency.

D. The Redevelopment Plan for the Rocklin Redevelopment Project (herein, the “Redevelopment Project”) was adopted by Ordinance No. 549 by the City Council of the City of Rocklin on June 10, 1986, and was subsequently amended (as amended, the “Redevelopment Plan”).

The Redevelopment Plan, as amended, is on file with City as a public record.

E. Prior to the Date of Agreement, City acquired certain real property consisting of approximately 2.51 acres (the “ Portion B Area”) and an additional approximately 0.42 acres ( the “Portion A Site”) located within the Project Area and within the corporate limits of City. The Portion B Area is depicted on the “Portion B Area Map” (Attachment No. 1 hereto). The legal description of the Portion B Area is attached hereto as Attachment No. 2. The Portion A Site is depicted on the “Map of the Portion A Site” (Attachment No. 17 hereto).

F. City and Community HousingWorks, a California nonprofit public benefit corporation (“CHW”, as also defined below) previously entered into an unrecorded agreement entitled “Affordable Housing Agreement” dated as of October 17, 2022 (the “Original Agreement”). A copy of the Original Agreement is on file with City as a public record. Under the Original Agreement, City committed the sum of Two Million Six Hundred Thousand Dollars ($2,600,000) in funding which was to be a loan in support of construction of improvements contemplated under the Original Agreement.

G. CHW is experienced in the development and operation of affordable multi -family housing.

H. Under the Original Agreement, Developer proposed that City would transfer a ground leasehold interest in the Portion A Site and the Portion B Area, respectively, to Developer or one or more assignees of Developer hereafter approved by City, with the City ground leasing either the 821

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Portion A Site and the Portion B Area as a whole or in two parts, whereupon Developer or assignees as shall have been approved in writing by City would be required to develop a designated number of those dwelling units , as more particularly set forth herein, to be rented at “Affordable Rent” and in conformity with the “Prescribed Income Levels” throughout the “Required Covenant Period” (as those capitalized terms were defined in the Original Agreement).

I. Subsequent to the Original Agreement, CHW applied for a preliminary reservation of 4% federal low income housing tax credits as generally provid ed for under Section 42 of the Internal Revenue Code with respect to the development of the Portion A Site; CHW additionally applied for a preliminary reservation of 9% federal low income housing tax credits with respect to the development of the Portion B Area. As contemplated under the Original Agreement and as continues to be the case, CHW intends (and Developer concurs) that the Portion A Site and the Portion B Area, respectively, shall be developed by different development entities, each an affiliate (including single asset entities) of Developer; the financing for each of the development of the Portion A Site and the Portion B Area would be separate and without cross defaults.

J. By its approval of this Agreement, City approves the Developer as a single asset entity having been formed by CHW and which will develop the Portion B Area as provided under this Agreement.

K. Subject to the satisfaction of the applicable conditions in this Agreement, City will make available the aggregate amount of the City Loan (as defined below) to Developer or to an “Approved Assignee” for the Portion A Site as described below. The City Loan Amount shall be made available to defray a portion of the cost of the Improvements to the Portion A Site.

L. In the event the financing plan hereafter submitted by Developer with respect to some or all of the Improvements includes the use of newly issued multifamily housing bonds, the issuer shall be the City or another governmental entity designated for such pur pose by City acting at its sole discretion. Any such new issuance of bonds by City shall be accomplished in conformity with the City’s practices and procedures for conduit financings and in strict conformity with this Agreement.

M. This Agreement is in the vital and best interest of the City of Rocklin, California, and the health, safety and welfare of its residents and furthers the public policies of City.

NOW, THEREFORE , for and in consideration of the mutual promises, covenants, a nd conditions herein contained, the parties hereto agree as follows:

1. DEFINITIONS AND INTERPRETATION

1.1 Defined Terms. As used in this Agreement (and in all other Project Documents, unless otherwise defined), the following capitalized terms shall have the following meanings:
“Adjacent City Parking Area ” means that certain area referenced in the Scope of Development and more fully described in the Map of the Adjacent City Parking Area. “Affiliated Person ” means, when used in reference to a specific person, any person that directly or indirectly controls or is controlled by or under common control with the specified p erson, any person that is an officer or director o f a trustee of, or a general partner, managing member or operator in, the specified person or of which the specified person is an officer, director, trustee, general partner or managing member, or any perso n that directly or indirectly is the beneficial owner of ten percent (10%) or more of any class of the outstanding voting securities of the specified person. 822

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“Affordable Rent” has the following meaning: For an Extremely Low Income Household, Affordable Rent means a monthly rent which does not exceed one twelfth (1/12th) of thirty percent (30%) of thirty percent (30%) of the Median Income for the Area for a household size appropriate to the Unit. For a Very Low Income Household, Affordable Rent means a monthly rent which does not exceed one twelfth (1/12th) of thirty percent (30%) of fifty percent (50%) of the Median Income for the Area for a household size appropriate to the Unit. For a Lower Income Household, Affordable Rent means a monthly rent which does not exceed one twelfth (1/12th) of thirty percent (30%) of sixty percent (60%) of the Median Income for the Area for a household size appropriate to the Unit. The maximum monthly rental amount of the Units shall be adjusted annually by the formula set forth above upon the promulgation of revised Placer County median income figures by regulation of the California Department of Housing and Community Development. Actual rent charged may be less than such maximum rent a cost not in excess of the lesser of ( i) that rent which may be charged the applicable Eligible Person or Family pursuant to Section 50053 of the California Health and Safety Code and (ii) the limits as set forth in this Agreement. Notwithstanding the foregoing, in the event a reservation of Tax Credits is obtained for the Project, affordable rents, including a reasonable utility allowance, shall not exceed the rent prescribed by deed restrictions or regulatory agreements imposed by TCAC. “Allowable Closing Costs ” means actual, reasonable cost s of escrow for the Closing, including but not limited to any payable transfer taxes, recording fees, notary fees, the premium for the City Loan Policy, and all other charges paid which are customarily paid for similar transactions in the County.
“Applicable Federal Rate” means the interest rate set by the United States Treasury from time to time for the purpose of determining applicable Low Income Housing Tax Credit interest rates. The Applicable Federal Rate is published by the Internal Revenue Service in monthly revenue rulings. “Applicable Interest Rate” means the following rates: (a) as to amounts paid when due, three percent (3%) simple interest per annum, and (b) as to amounts not paid when due, the lesser of (i) ten percent (10%) per annum, compounded annually, and (ii) the maximum rate permitted by applicable law.
“Applicable Percentage of Residual Receipts ” means fifty percent (50%) of Residual Receipts; provided that if public agencies other than the City infuse moneys into the Project on a residual receipts loan basis, the percentage payable to the City will be subject to adjustment by City to reflect the ratable contribution by such other entities. “Approved Assignee(s) ” means such entity, if any, as hereafter approved by City as an assignee of Developer, with City acting at its sole discretion in this regard. “Approved Construction and/or Permanent Lender” means Cedar Rapids Bank and Trust Company, an Iowa state -chartered banking corporation (“CRBI”) or one or more entities included under the definition of Approved Construction Lender, an Institutional Lender, or any other lender approved by the City Manager. Each of California Community Reinvestment Corporation and the County of Placer acting through the Health and Human Services Agency is an Approved Permanent Lender.
“Area” means Placer County, or such area including Placer County as may be periodically defined by HUD.
“Audit” is defined in Section 6.21 hereof.
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“Audited Financial Statement ” means an audited financial statement, including wit hout limitation a profit and loss statement, generated by Leaf & Cole, LLP, or another third party certified public accountant acceptable to City in its reasonable discretion, showing, for the previous Lease Year, on a monthly basis and in an easily readab le format, Gross Revenues, Operating Expenses, Debt Service, Operating Reserve, Capital Replacement Reserve, General Partner Fee, Limited Partner Fee and Residual Receipts.
“Bank Deed of Trust ” means a deed of trust, among one or more Approved Construction and/or Permanent Lender , as beneficiary and Developer as trustor and a trustee, which may be an affiliate of the holder of the Bank Deed of Trust, in connection with the construction loan provided by an Approved Construction Lender, and upon the take out of the construction loan, a deed of trust by an Approved Permanent Lender to Developer , as well as any swap deed of trust entered into in connection with the Primary Permanent Loan which does not include cross -collateralization or a change in the security.
“Base Pro Forma ” means a pro forma dated as of October 30, 2025 concerning the Development. The Base Pro Forma is on file with the City. “Basic Concept Drawings” is described in Section 6.1 hereof. “Bond Counsel ” means such counsel as shall be selected b y City at its discretion for all purposes associated with this Agreement and the implementation hereof. “Bond Regulatory Agreement ” means the regulatory agreement, as prepared by Bond Counsel, which it is contemplated may be required to be recorded against the Portion A Site with respect to the issuance of new multifamily housing bonds in the event an allocation is obtained for the Improvements on the Portion B Area from CDLAC and Bonds are used in connection with the financing of such improvements. The Bo nd Regulatory Agreement shall include affordability restrictions not less restrictive than those set forth in the City Regulatory Agreement. “Bond Rules” means Section 103(b) of the Internal Revenue Code, the rules and regulations applied by CDLAC in conne ction with the private activity bond allocation or the issuance of bonds thereunder and as set forth in the indenture of trust (or similar instrument approved for such purpose by City) in connection with the issuance of the Bonds.
“Bonds” means multifamily conduit revenue bonds issued in connection with the Improvements (or portions thereof) by City.
“Building Permit ” means the building permit(s) issued by City and required for the Improvements.
“Calculation of Affordable Rents” means Attachment No. 7 to this Agreement. “CDLAC” means the California Debt Limit Allocation Committee. “Capital Replacement Reserve” means a reserve fund to be established by the Lessee under the City Lease as a capital reserve for the Improvements in the amount established therefor by the Lease. To the extent Developer is required to maintain a Capital Replacement Reserve by any Approved Construction and/or Permanent Lender or Investor , Developer shall receive a credit hereunder for such amounts maintained by it in compliance with such Approved Construction and/or Permanent Lender capital replacement reserve requirement. 824

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“Certificate of Completion” means Attachment No. 10 to this Agreement. “Certificate of Continuing Program Compliance ” means the Certificate to b e filed by Developer or its property manager on behalf of Developer with City, which Certificate shall be substantially in the form attached hereto as Attachment No. 4. “Chargeable Reserves ” means each of the following, within the respective parameters therefor set forth in the City Lease: (i) Capital Replacement Reserve; and (ii) Operating Reserve. “CHW”, as defined above, means Community HousingWorks, a California nonprofit public benefit corporation.
“City,” as defined in the first paragraph hereof, means the City of Rocklin, a municipal corporation.
“City Code,” as defined in the Recitals hereto, is the Municipal Code of the City of Rocklin as may be amended from time to time and includes, without limitation, the Uniform Codes. “City Conditions Precedent” is set forth in Section 4.1 hereof. “City Documents” means, collectively, this Agreement, the City Lease, the City Regulatory Agreement, and all other documents required to be executed by Developer in connection with the transaction contemplated by this Agreement.
“City Escrow” is described in Section 3.3 hereof.
“City Fees ” means fees charged by the City in connection with the construction of the Improvements where such fees are not collected by City on behalf of another governmental agency.

City Fees includes, without limitation, City Impact Fees, building permit fees and inspection fees. “City Impact Fees” means those facility fees, road improvement fees, and other fees identified by City as development impact fees, including street improvements an d/or street improvement fees, required by City and retained by City in connection with the development of the Project. “City Lease” means a ground lease in the form of Attachment No. 6 to this Agreement, which shall grant Developer a leasehold interest in the Portion B Area and a fee interest in the Improvements. “City Manager” means the City Manager of City or his or her designee or delegate. “City Regulatory Agreement” means Attachment No. 11 to this Agreement. “Closing” is defined in Section 3.3.4 of this Agreement. “Commencement Date of the City Lease” shall have the meaning established therefor in the City Lease.
“Cost Overrun Amounts” means amounts incurred and expended by Developer in connection with construction under this Agreement to the extent that: (i) total construction and demolition costs exceed the amounts set forth therefor in the Base Pro Forma; (ii) such amounts have not been defrayed by moneys provided by City; and (iii) the City Manager, acting in good faith and upon consultation 825

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with Developer, confirms that such amounts were reasonably incurred and were not unreasonable as to amount.
“Cost Savings” is defined in Section 6.21 hereof.
“County” means the County of Placer, California.
“Date of Agreement” means ________ __, 202_.
“Debt Se rvice” means required debt service payments for the Primary Construction Loan and/or the Primary Permanent Loan including the funding obligations in respect of all reserves or escrows required thereunder and scheduled payments as approved as part of the Fi nal Financing Package.
“Default” is defined in Section 7.1 hereof.
“Deferred Developer Fee ” means that portion of the Developer Fee for which payment to CHW is deferred. The amount of the Deferred Developer Fee shall be finally determined in connection with the Final Financing Plan.
“Developer” means Pacific Street Housing Associates Nine, L.P. , a California limited partnership.
“Developer Area” means that certain area conveyed by CHW to City during 2025. “Developer Conditions Precedent” is defined in Section 4.2 hereof. “Developer Contracting Parties” is defined in Section 1.6.1 hereof. “Developer Fee(s)” means the sum of such amounts delineated as developer fees in the Base Pro Forma, but not to exceed those amounts designated by TCAC as developer fees. “Developer Percentage” means fifty percent (50%) of Residual Receipts. “Development” or “Project” means the new apartment complex and associated improvements as required by this Agreement to be: (i) constructed by Developer upon the Portion A Site, with related offsite improvements, as more particularly described in the Scope of Development and (ii) operated as an affordable housing complex in conformity with the City Lease (s), the City Regulatory Agreement(s).
“Entitlements” means all development rights as determined under Administrative Determination AD-2025-0004 as approved May 8, 2025 by the Community Development Director of the City of Rocklin (including without limitation all conditions contained therein), and additional and use approvals for the development of the Portion B Area, if any, as may hereafter be approved by the City acting in the exercise of its police power.
“Environmental Laws ” means all law s, ordinances and regulations relating to Hazardous Materials, including, without limitation: the Clean Air Act, as amended, 42 U.S.C. Section 7401, et seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 9601, et seq.; the Comprehensive Environment Response, Compensation and Liability Act of 1980, as amended 826

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(including the Superfund Amendments and Reauthorization Act of 1986, “CERCLA”), 42 U.S.C.

Section 9601, et seq.; the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601 et seq.; the Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651, the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Mine Safety and Health Act of 1977, as amended, 30 U.S.C. Section 801 et seq.; the Safe Drinking Water Act, as amended, 42 U.S.C. Section 300f et seq.; all comparable state and local laws, laws of other jurisdictions or orders and regulations; and all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State, City, or any other political subdivision in which the Portion A Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over City, Developer, or the Portion A Site. “Escrow Holder ” means Stewart Title Guaranty Company or another mutually acceptable escrow holder.
“Event of Default” has the meaning set forth in Section 9.1 hereof. “Excess Amount” is defined in Section 6.15 hereof.
“Extremely Low Income Households ” means households earning not greater than thirty percent (30%) of Median Income for the Area pursuant to the Health and Safety Code Section 50106. “Extremely Low Income Unit” means a Unit occupied at Affordable Rent by an Extremely Low Income Household.
“Final Development Budget ” means a detailed enumeration of all projected costs of construction of the Development, including all costs and off site i mprovements required to be constructed under this Agreement.
“Final Financing Package” is defined in Section 6.15 hereof. “General Partner” means the general partner of Developer. “General Partner Fee” or “Asset Management Fee” means a fee if charged by the general partner not to exceed the amounts so delineated therefor in the Base Pro Forma; provided that the initial annual amount of such fee shall be limited to increases of three percent (3.0%) annually; provided that the General Partner Fee together with the Limited Partner Fee shall not for any Lease Year exceed the amount permitted under th e City Lease for the Partnership Fees (as such fees are aggregated) . The foregoing shall not limit the a mounts which Developer may pay to its General Partner from the Developer Percentage.
“Gross Revenues” shall have the meaning set forth therefor in the City Lease. “Hazardous Material ” or “ Hazardous Materials ” means and include any substance, material, or waste which is or becomes regulated by any local governmental authority, including the County, the Regional Water Quality Control Board, the State of California, or the United States Government, including, but not limited to, any material or substance which is: (i) defined as a “hazardous waste,” “acutely hazardous waste,” “restricted hazardous waste,” or “extremely hazardous waste” under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140, of the California Health and Safety Code, Divisio n 20, Chapter 6.5 (Hazardous Waste Control Law); (ii) defined as a “hazardous substance” under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter Presley Tanner Hazardous Substance Account Act); (iii) defined as a 827

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“hazardous material,” “hazardous substance,” or “hazardous waste” under Section 25501 of the California Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); (iv) defined as a “hazardous substance” und er Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); (v) petroleum; (vi) asbestos and/or asbestos containing materials; (vii) lead based paint or any lead based or lead products; (viii) polychlorinated biphenyls, (ix) designated as a “hazardous substance” pursuant to Section 311 of the Clean Water Act (33 U.S.C. Section 1317); (x) defined as a “hazardous waste” pursuant to Section 1004 of the Resource Conservation and Recovery Act , 42 U.S.C. Section 6901, et seq. (42 U.S.C. Section 6903); (xi) Methyl tert iary Butyl Ether; (xii) defined as “hazardous substances” pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601, et seq. (42 U.S.C. Section 9601); (xiii) any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever, which by any “Governmental Requirements” (as defined in Paragraph (c) of this Section 308) either requires special h andling in its use, transportation, generation, collection, storage, handling, treatment or disposal, or is defined as “hazardous” or harmful to the environment; and/or (xiv) lead based paint pursuant to and defined in the Lead Based Paint Poisoning Preven tion Act, Title X of the 1992 Housing and Community Development Act, 42 U.S.C. § 4800, et seq., specifically §§ 4821 –4846, and the implementing regulations thereto. Notwithstanding the foregoing, “Hazardous Materials” shall not include such products in quantities below attainment levels identified in one or more of the enactments identified above as Governmental Requirements, including those products and amounts as are customarily used in the construction, maintenance, rehabilitation, management, operati on and residence of residential developments or associated buildings and grounds, or typically used in residential activities in a manner typical of other comparable residential developments, or substances commonly ingested by a significant population livi ng within the Development, including without limitation alcohol, aspirin, tobacco and saccharine.
“Hazardous Materials Contamination” means the contamination (whether presently existing or hereafter occurring) of the improvements, facilities, soil, groundwater, air or other elements on, in, or under the Portion A Site by Hazardous Materials, or the contamination of the buildings, facilities, soil, groundwater, air or other elements on, in or of any other property as a result of Hazardous Materials at any time (whether before or after the Date of Agreement) emanating from the Portion A Site.
“HCD” means the Housing and Community Development Department of the State of California.
“Housing Rent” means the total of monthly payments by the tenants of a Unit for (a) use and occupancy for the Unit and facilities associated therewith, (b) any separately charged fees or service charges assessed by Developer which are required of all tenants of the Units, other than security deposits, (c) a reasonable allowance for uti lities not included in (a) or (b) above, including garbage collection, sewer, water, electricity and gas, as determined by regulation of Housing Authority of the County of Placer pursuant to 24 C.F.R. Section 5.600 et seq. or by the California Utility Allo wance Calculator as permitted by TCAC, and (d) possessory interest, taxes or other fees or charges assessed for the use of the Units and facilities associated therewith by a public or private entity other than Developer; provided that the rent charged as t o any Required Affordable Unit shall not exceed Affordable Rent.
“Improvements” means all of the improvements described in the Scope of Development. “Income Verification” means Attachment No. 12 to this Agreement. 828

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“Indemnitees” is defined in Section 1.6.3.
“Investor” means the Developer’s investor limited partner. “Lease Rider” means a lease rider agreement provided by TCAC in a form customarily used by TCAC.
“Lease Year” means the period commencing as of the Commencement Date of the City Lease and ending a s of December 31 of that calendar year, then each succeeding calendar year thereafter during the Term of the City Lease; provided that the final Lease Year may be a portion of a calendar year.
“Leasehold Transfer” means the transfer of a leasehold interest in the Portion A Site and fee interest in the Improvements to Developer by the terms of the City Lease upon commencement of the Term of the City Lease.
“Legal Description of the Portion B Area” means Attachment No. 2 to this Agreement. “Lessee” means Developer or other lessee under the City Lease(s). “Lessee’s Title Policy” is defined in Section 3.5 hereof. “Limited Partner” means NEF Assignment Corporation or its affiliate. “Limited Partner Fee” or “Partnership Management Fee” means fees as so denominated in the Base Pro Forma; provided that such fees may not increase by more than by three percent (3.0%) annually so long as the Partnership Agreement is in effect ; provided that the General Partner Fee together with the Limited Partner Fee shall not for any Lease Year exceed the amount permitted under this Lease for the Partnership Fees (as such fees are aggregated) . The foregoing shall not limit the amounts which Developer may pay as Limited Partner Fee or Partner ship Management Fee from the Developer Percentage.
“Low and Moderate Income Housing Funds” means moneys which were required under the Redevelopment Law to be deposited into a fund created under Health and Safety Code Section 33334.2 and 33334.3.
“Low Income Households” or “Lower Income Households” means households earning not greater than sixty percent (60%) of Median Income.
“Low Income Unit” or “Lower Income Unit” means a Unit occupied at Affordable Rent by a Low Income Household.
“Map of the Adjacent City Parking Area” means Attachment No. 18. “Map of the Portion A Site” means Attachment No. 17.
“Materially Adverse Conditions” are surface or subsurface conditions of the Portion A Site which: (i) are not apparent from a visual inspection of the s urface of the Portion A Site ; and (ii) (a) include the presence of Hazardous Materials at the Portion A Site in excess of currently applicable levels permitted under federal or state law or regulations, or (b) include the presence of conditions not typically found in properties within City and which a mutually acceptable independent 829

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third party geotechnical and/or environmental assessment and remediation firm retained by Developer estimates will increase development costs by over One Hundred Thousand Dollars ($100,000.00). “Median Income” means Median Income for the Area (namely, Placer County), as set forth by regulation of the California Department of Housing and Community Development pursuant to Health and Safety Code Sections 50079.5 and 50105.
“Notice” means a notice in the form prescribed by Section 10.2 hereof. “Notice of Affordability Restrictions” means Attachment No. 5. “Official Records” means, unless the context otherwise requires, the official land records of the County Recorder of the County of Placer.
“Operating Expenses” has the meaning established therefor in the City Lease. “Operating Reserve” has the meaning set forth therefor in the City Lease. “Partnership Agreement” has the meaning set forth therefor in the City Lease. “Partnership Fees” means the General Partner Fee and the Limited Partner Fee. “Permitted Senior Lien ” means collectively, the deeds of trust securing the Primary Construction Loan and the Primary Permanent Loan.
“Portion B Area” means that real property depicted on the Portion B Area Map and described with greater particularity by the Legal Description of the Portion B Area. “Portion B Area Map” means Attachment No. 1 to this Agreement. The Portion B Area Map depicts the Portion A Site (which is to be developed under this Agreement). “Prescribed Income Levels” means: (i) for six (6) one bedroom Units, thirty percent (30%) of Median Income; (ii) for two (2) two bedroom Units , thirty percent (30%) of Median Income; (i ii) for six (6) two -bedroom Units, thirty percent (30%) of Median Income; (iv) for thirteen (13) one bedroom Units, fifty percent (50%) of Median Income; (v) for five (5) two bedroom Units, fifty percent (50%) of Median Income; (vi) for six (6) three bedroom Units, fifty percent (50%) of Median Income; (vii) for five (5) one bedroom Units, sixty percent (60%) of Median Income; (viii) for eight (8) two bedroom Units, sixty percent (60%) of Median Income ; and (ix) for eight (8) three bedroom Units, sixty percent (60%) of Median Income. There shall additionally be one manager’s unit; the manager’s unit shall not be restricted on the basis of income.
“Primary Construction Loan” means, collectively, the mortgage loans and letters of credit obtained by Developer from an Approved Construction Lender. “Primary Permanent Loan” means, collectively, the mortgage loans obtained by Developer from an Approved Permanent Lender in an amount limited to satisfaction of the outstanding balance of the Primary Construction Loan or in an amount in excess of such outstanding balance so long as such excess proceeds are used to pay (or prepay) the Developer Fee, Cost Overrun Amounts and outstanding development costs.
“Principals” means Kevin Leichner and CHW.
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“Project Documents” means, collectively, this Agreement, the City Regulatory Agreement, the City Lease , all other Attachments to this Agreement, and any other agreement, document, or instrument that City requires in connection with the execution of this Agreement or from time to time to effectuate the purposes of this Agreement.
“Reciprocal Easement and Joint Use Agreement ” means an agreement to be entered into among the Developer, Pacific Street Housing Associates Four, L.P., a California limited partnership (the “Portion A Site Entity”), and the City, which shall include provisions satisfactory to City concerning: (i) ingress, egress, and access as to the Portion A Site for residents of the Portion B Area; (ii) ingress, egress, and access as to the Portion B Area for the residents of the Portion A Site ; (iii) access of residents of each of the Portion B Area and the Portion A Site to common area facilities including joint use facilities; (iv) access to the manager to be on site at the Portion B Area for residents of the Portion A Site ; (v) access to parking for residents of the Portion A Site and residents of the Portion B Area; (vi) an agreement by City that if the developer of the Portion B Area defaults and the ground lease as to the Portion B Area is terminated, City will make diligent efforts to provide access to residents of the Portion A Site to the Portion B Area; and (vii) a provision that the R eciprocal Easement and Joint Use Agreement may not be amended without the prior written approval of City, which City may grant, conditionally grant, or withhold in its sole discretion. “Recordable Documents” means the following: (i) the City Lease (or a Memorandum thereof prepared by City); (ii) the City Regulatory Agreement; (iii) the Bank Deed (s) of Trust; ( iv) 1-UCC Financing Statement by Developer in favor of an Approved Construction and/or Permanent Lender (as construction lender) for filing as a fixture filing among Official Records; (v) the Notice of Affordability Restrictions; and (vi) such other instruments, if any, as shall be approved by City Manager (upon consultation with City’s legal counsel) as necessary or convenient to effectuate and implement the initial financing of the Improvements (and the permanent financing). “Redevelopment Plan ” means the Redevelopment Plan for the Rocklin Redevelopment Project (the “Redevelopment Pr oject”) first approved by Ordinance No. 549 adopted by the City Council of the City on Ju ne 10, 1986 , as subsequently amended. The Redevelopment Plan , as amended, is on file with City as a public record.
“Refinancing Net Proceeds ” means the proceeds of an y refinancing of any of the Primary Construction Loan or the Primary Permanent Loan or other approved financing secured by interest of Developer in the Portion B Area, net of: (i) the amount of the existing financing which is satisfied out of such proceed s; (ii) reasonable and customary costs and expenses incurred in connection with the refinancing; (iii) the funding of reasonable reserves and costs of improvements to the Portion B Area which constitute the Development, including hard and soft costs to the extent approved in writing by the City Manager prior to the closing of the refinancing; (iv) the balance of loans to the Development made by the Limited Partner(s) of Developer for development or operating deficits, amounts expended to maintain compliance with the Tax Credit Rules, or contributions for capital expenditures in excess of available Project revenues, if any, including interest at the Applicable Federal Rate; (v) the balance, if any, of operating loans or development loans made by the general p artners of Developer to the Development, including interest at the Applicable Federal Rate; (vi) payment of unpaid Tax Credit adjustment amounts or reimbursement of Tax Credit adjustment amounts paid by the general partner and/or the guarantors to the Development pursuant to the approved Partnership Agreement, if any; and (vii) the payment to the general partner of Developer of a refinancing fee, which fee is and shall be subject to the approval of the City Manager at the time of each refinancing and which shall not exceed five percent (5%) of the amount of the approved refinancing. 831

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“Related Entity ” means CHW, a Principal or an entity in which any interest is held by Developer or one or more of the Principals.
“Relocation” or “Relocation Laws” means all applicable federal and state relocation laws and regulations, including without limitation, (i) the relocation obligations of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (“URA”), 42 U.S.C. 4201–4655, and the implementing regulations thereto set forth in 49 C.F.R. Part 24, (ii) the California Relocation Assistance Act, Government Code Section 7260, et seq. and the implementing regulations thereto set forth in Title 25, Section 6000, et seq. of the California Code of Regulations, and (iii) any other applicable federal, state or local enactment, regulation or practice providing for relocation assistance, benefits, or compensation for moving and for property interests (including without limitation goodwill and furnishings, fixtures and equipment, and moving expenses), and (iv) any federal law or regulation prohibiting payment of relocation benefits or assistance to persons ineligible for relocation benefits or assistance. City shall be responsib le for any costs or expenses as a result of the application of the Relocation Laws to the Development or this Agreement.
“Reporting Amounts” means the sum of Two Hundred Fifty Dollars ($250.00) per unit per year for each dwelling unit as to which Lessee fa ils to deliver to City, during any Lease Year, a full and adequate report that conforms to Section 33418 of the California Health and Safety Code. “Request for Notice of Default” means an instrument substantially in the form of Attachment No. 8.
“Required Affordable Units” means all of the Units required to be developed on the Portion B Area under this Agreement other than one manager’s unit. The final delineation of affordable units shall be accomplished in connection with approval of the Final Financing Plan (provided that the number of units generated and income levels shall in no event be less beneficial to City than that set forth herein as the Prescribed Income Levels).
“Required Covenant Period ” means an eighty-seven (87) year period concurrent with the Term of the City Lease.
“Required Submittal Modifications” means modifications to a Required Submittal which are reasonably calculated to achieve a reservation of Tax Credits in an amount of not less than the Tax Credit Amount in the next round of Tax Credits; provided that such modifications shall not include any infusion of City moneys other than those amounts expressly set forth in this Agreement for such purpose.
“Residual Receipts” for a particular Lease Year means Gross Revenues for the corresponding Lease Year less (i) Debt Service payments made during such Lease Year on the Primary Construction Loan or the Primary Permanent Loan, including payments under escrow and reserve provisions thereunder in amounts not in excess of the amounts due and pay able during such month (and not including prepayments), and (ii) the sum of Operating Expenses and, to the extent funded, payments made to Chargeable Reserves as made during the corresponding Lease Year, and payments of Deferred Developer Fee as made to CH W and any approved Assignee during the corresponding Lease Year.

All calculations of Residual Receipts shall be made annually, on or before May 15 for the preceding Lease Year, on a cash (and not accrual) basis and the components thereof shall be subject to verification and approval, on an annual basis, based upon conformity with the terms of this AHA and the City Lease, by the City Manager on behalf of the City.
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“Schedule of Performance ” means Attachment No. 3 to this Agreement. The Schedule of Performance sets forth the dates by which City and Developer are to perform certain obligations under this Agreement.
“Scope of Development ” means Attachment No. 9 to this Agreement. The Scope of Development is subject to modification as provided in Section 2.2. “Tax Credit Amount (s)” means the amounts so delineated therefor in the Base Pro Forma, namely: not less than Twenty Four Million Dollars ($24,000,000.00) in federal tax credits; this amount represents the projected yield from the marketing of the Tax Credits under the Base Pro Forma and may not correspond to the amount of tax credits ultimately available. “Tax Credit Application ” means that application for Tax Credits previously submitted by CHW to TCAC to obtain an allocation of 9% Tax Credits for the Development or such other financing as may be applied for pursuant to Section 6.15.
“Tax Credit Deadline” means December 30, 2025.
“Tax Credit Rent ” means that maximum rent permitted to be paid for a household corresponding to an income category set forth in this agreement (such as 50% of Median Income) under the Tax Credit Rules.
“Tax Credit Rules ” means Section 42 of the Internal Revenue Code and/or California Revenue and Taxation Code Sections 17057.5, 17058, 23610.4 and 23610.5 and California Health and Safety Code Section 50199, et seq., and the rules and regulations implementing the foregoing, including without limitation the program regulations promulgated by TCAC. “Tax Credits” means 9% Housing Tax Credits granted pursuant to Section 42 of the Internal Revenue Code and/or California Revenue and Taxation Code Sections 17057.5, 17058, 23610.4 and 23610.5 and California Health and Safety Code Section 50199, et seq. “TCAC” means the Tax Credit Allocation Committee of the State of California. “Tenant Selection and Tenant Services Plan” has the meaning established therefor in Section 7.2.3 of this Agreement.
“Term of the City Lease ” or “ Term” means that eighty -seven (87) year period as more particularly set forth in the City Lease.
“Title Company” shall be Stewart Title Guaranty Company or another title insurer mutually acceptable to City and Developer.
“Uniform Codes” means each of the following as in effect from time to time as approved by City: the Uniform Building Code, the Uniform Housing Code, the National Electrical Code, the Uniform Plumbing Code, the Uniform Mechanical Code, and the Uniform Code for the Abatement of Dangerous Buildings.
“Unit” means each of the dwelling units required to be developed by Developer under this Agreement.
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“Universal Application Package” means a packet so designated by City staff which includes comprehensive plans for the development of the Portion B Area ; Universal Application Package is further described in Section 6.1 of this Agreement.
“Very Low Income Households ” means households earning not greater than fifty percent (50%) of Median Income for the Area pursuant to the Health and Safety Code Section 50105. “Very Low Income Unit” means a Unit occupied at Affordable Rent by an Extremely Low Income Household.
“Year” means the period commencing as of the Leasehold Transfer and ending as of December 31 of that calendar year, then each succeeding calendar year thereafter during the Required Covenant Period terminating as of the last day of the Required Affordable Period.

1.2 Singular and Plural Terms. Any defined term used in the plural in this Agreement or any Project Document shall refer to all members of the relevant class and any defined term used in the singular shall refer to any number of the members of the relevant class.

1.3 References and Other Terms . Any reference to this Agreement or any Project Document shall include such document both as originally executed and as it may from time to time be modified. References herein to Articles, Sections and Exhibits shall be construed as references to this Agreement unless a different document is named. References to subparagraphs shall be construed as references to the same Section in which the reference appears. The term “document” is used in its broadest sense and encompasses agreements, certificates, opinions, consents, instruments and other written material of every kind. The terms “including” and “include” mean “including (include) without limitation.”

1.4 Exhibits Incorporated . All attachments and exhibits to this Agreement, as now existing and as the same may from time to time be modified, are incorporated herein by this reference.

1.5 Representations and Warranties.

1.5.1 City Representations. City represents and warrants to Developer as follows:
(a) City. City is a municipal corporation , acting as a housing authority existing pursuant to the Housing Authorities Law, which has been authorized to transact business pursuant to action of City. City has full right, power and lawful authority to lease the Portion B Area as provided herein and the execution, performance, and delivery of this Agreement by City has been fully authorized by all requi site actions on the part of City. The parties who have execute d this Agreement on behalf of City are authorized to bind City by their signatures hereto. (b) Litigation. To the best of City’s knowledge, there are no actions, suits, material claims, legal proceedings, or any other proceedings including the City affecting the Portion B Area or any portion thereof, at law or in equity before any court or governmental agency, domestic or foreign.
(c) No Conflict . City’s execution, delivery, and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which City is a party or by which it is bound. 834

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(d) Condition of the Portion B Area as of the Leasehold Transfer . The condition of the Portion B Area as of the Leasehold Transfer (including but not limited to the condition of title and the physical condition, excepting to the extent, if any, that these are modified due to activities of Developer) will not be materially different from that existing as of the Date of Agreement. (e) No City Bankruptcy. City is not the subject of a bankruptcy proceeding.

Until the Leasehold Transfer, City shall, upon learning of any fact or condition which would cause any of the warranties and representations in this Section 1.5.1 not to be true as of the Leasehold Transfer, immediately give written notice of such fact or condition to Developer. Such exception(s) to a representation shall not be deemed a breach by City hereunder, but shall constitute an exception which Develop er shall have a right to approve or disapprove if such exception would have an effect on the value and/or operation of the Portion B Area. If Developer elects to accept the Leasehold Transfer and possession of the Portion B Area following disclosure of su ch information, City’s representations and warranties contained herein shall be deemed to have been made as of the Leasehold Transfer, subject to such exception(s). If, following the disclosure of such information, Developer elects to not accept the Lease hold Transfer of and possession of the Portion B Area, then this Agreement shall automatically terminate, and neither party shall have any further rights, obligations or liabilities hereunder. The representations and warranties set forth in this Section 1.5.1 shall survive the Leasehold Transfer.

1.5.2 Developer Representations. Developer represents and warrants to City as follows:
(a) Authority. Developer is a duly organized California nonprofit public benefit corporation organized within and in good standing under the laws of the State of California.

Developer has full right, power and lawful authority to lease and accept title to and possession of the Portion B Area and undertake all obligations as provided herein and t he execution, performance and delivery of this Agreement by Developer has been fully authorized by all requisite actions on the part of Developer. The parties who have executed this Agreement on behalf of Developer are authorized to bind Developer by their signatures hereto.
(b) Litigation. To the best of Developer’s knowledge, there are no actions, suits, material claims, legal proceedings, or any other proceedings affecting Developer, at law or in equity before any court or governmental agency, domestic or foreign. (c) No Conflict. Developer’s execution, delivery, and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Developer is a party or by which it is bound. (d) No Devel oper Bankruptcy . Developer is not the subject of a bankruptcy proceeding.
(e) Developer Experience; Sophisticated Party. Developer and each of the Principals of Developer are sophisticated parties, with substantial experience in the acquisition, rehabilitation, development, financing, obtaining financing for, marketing, and operation of affordable housing projects, including rental projects, and with the negotiation, review, and preparation of agreements and other documents in connection with such activities. Developer is familiar with and has reviewed all laws and regulations pertaining to the development and operation of the Development, 835

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including without limitation the Tax Credit Rules, and has obtained advice from any advisers of its own choosing in connection with this Agreement.
(f) Due Authorization and Execution; Studies Completed. Developer has duly authorized the execution of this Agreement, and prior to the Leasehold Transfer (in the event Developer proceeds with the Leasehold Transfer) will duly authorize the City Regulatory Agreement, and the City Lease. Prior to the Leasehold Transfer, Developer shall execute and deposit with City (to be held pending satisfaction of the City Conditions Precedent as set forth in Section 3.1 hereunder) the City Regulatory Agreement, and all documents necessary to effectuate the Leasehold Transfer hereunder.

Until the Leasehold Transfer, Developer shall, upon learning of any fact or condition which would cause any of the warranties and representations in this Section 1.5.2 not to be true as of the Leasehold Transfer, immediately give written notice of such fac t or condition to City. Such exception(s) to a representation shall not be deemed a breach by Developer hereunder, but shall constitute an exception which City shall have a right to approve or disapprove if such exception would have an effect on the devel opment and/or operation of the Portion B Area. If City elects to proceed with the Leasehold Transfer following disclosure of such information, Developer’s representations and warranties contained herein shall be deemed to have been made as of the Leasehold Transfer, subject to such exception(s). If, following the disclosure of such information, City elects to not close Escrow, then this Agreement and the Escrow shall automatically terminate, and neither party shall have any further rights, obligations or liabilities hereunder. The representations and warranties set forth in this Section 1.5.2 shall survive the Leasehold Transfer.

1.6 Condition of the Portion B Area.

1.6.1 Studies and Reports. Prior to the Closing, Developer and its employees, agents, contractors and consultants (collectively, the “ Developer Contracting Parties”) may enter the Portion B Area as necessary during regular business hours to obtain data and make any other or additional surveys, tests, studies, and reports necessary to evaluate the suitability of the Portion B Area for the Development, including but not limited to invasive testing and the investigation of the environmental and physical condition of the Portion B Area (collectively, the “Studies”). Any studies undertaken on the Portion B Area by any of the Developer Contracting Parties prior to the Closing shall be done at the sole expense of Developer, and Developer shall make arrangements with City staff prior to undertaking such work and entering the Portion B Area. Any studies shall be undertaken only after Developer has secured the consent of the City and any necessary permits therefor from the appropriate governmental agencies, including without limitation City. Developer hereby agrees to promptly provide City with any and all Studies relating to the environmental condition of the Portion B Area upon Developer’s acquisition thereof but without any representation as to the accuracy of such Studies or City’s or City’s rights to rely thereon. Following the complet ion of the tests and investigations described in this section, Developer shall restore the surface of the Property to substantially the condition existing prior to the performance of any such tests or investigations.

Developer shall also indemnify, defend and hold City and its board members, council members, officers, and employees harmless against any claims for damage to person or property arising from entry on or activities of any of Developer Contracting Parties pursuant to this section, except and to the extent resulting from the gross negligence or willful misconduct of City. This obligation to indemnify shall survive termination of this Agreement.

1.6.2 Approval of Condition of the Site. Developer shall notify City on or before the thirtieth day after th e Date of Agreement and prior to the commencement of the term of the City 836

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Lease to the following effect: (i) that Developer has determined that there are not Materially Adverse Conditions on the Portion B Area, or (ii) that there are Materially Adverse Conditions on the Portion B Area but Developer has located funding sources to remediate, remove or otherwise satisfy such Conditions and that Developer elects to proceed to accept the Leasehold Transfer and proceed with performance, (iii) that there are Materially Adverse Conditions on the Portion B Area and Developer elects to terminate pursuant to Section 7.3(a) hereof unless City and Developer agree, within (15) days following the date such notice is received by City to otherwise resolve such conditions to Developer’s satisfaction, in Developer’s sole and absolute discretion.

1.6.3 Indemnification. Developer shall save, protect, pay for, defend (with counsel acceptable to each of City), indemnify and hold harmless City and its elected and appointed officials, officers, employees, attorneys, representatives, volunteers, contractors and agents (collectively, “Indemnitees”) from and against any and all liabilit ies, suits, actions, claims, demands, penalties, damages (including, without limitation, penalties, fines and monetary sanctions), losses, costs or expenses (including, without limitation, consultants’ fees, investigation and laboratory fees, attorneys’ fees and remedial and response costs and third -party claims or costs) (the foregoing are hereinafter collectively referred to as “Liabilities”) that may now or in the future be incurred or suffered by Indemnitees by reason of, resulting from, in connection with or arising in any manner whatsoever as a direct or indirect result of: (i) the presence, use, release, escape, seepage, leakage, spillage, emission, generation, discharge, storage, or disposal of any Hazardous Materials in, on, under, or about, or the transportation of any such Hazardous Materials to or from, the Portion B Area occurring after the Closing or caused or contributed to by Developer; (ii) the violation, or alleged violation, of any statute, ordinance, order, rule, regulation, permit, judgment, or license relating to the use, generation, release, leakage, spillage, emission, escape, discharge, storage, disposal, or transportation of Hazardous Materials in, on, under, or about, or to or from, the Portion B Area by Developer or occurring after the Closing; (iii) the physical and environmental condition of the Portion B Area caused or contributed to by Developer or occurring after the Closing, and (iv) any Liabilities caused or contributed to by acts or omissions of Developer relating to any Environmental Laws and other Governmental Requirements relating to Hazardous Materials and/or the environmental and/or physical condition of the Portion B Area. The foregoing indemnification shall continue in full force and effect regardless of whether such condition, liability, loss, damage, cost, penalty, fine, and/or expense shall accrue or be discovered before or after the termination of the Required Covenant Period. This indemnification supplements and in no way limits the indemnification set forth in Article 6.

1.6.4 Duty to Prevent Hazardous Material Contamination. During the construction, development, operation and management of the Development, Developer shall take all necessary precautions to prevent the release of any Haz ardous Materials into the environment on or under the Portion B Area. Such precautions shall include, but not be limited to, compliance with all Environmental Laws and other Governmental Requirements. Developer shall notify City, and provide to City a copy or copies of any notices of violation, notices to comply, citations, inquiries, clean up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting requirements and reports filed or applications made pursuant to all Environme ntal Laws and other Governmental Requirements, and Developer shall report to City, as soon as possible after each incident, any unusual or potentially important incidents in the event of a release of any Hazardous Materials into the environment.

1.6.5 Release of Indemnitees by Developer. Developer hereby waives, releases and discharges forever the Indemnitees from all present and future claims, demands, suits, legal and administrative proceedings and from all liability for damages, losses, costs, liabilities, fe es and expenses, including attorneys’ fees, court and litigation costs and fees of expert witnesses, present and 837

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future, arising out of or in any way connected with Developer’s possession or use of the Portion B Area, improvement of the Portion B Area in a ccordance with this Agreement, the Scope of Development, and the land use entitlements obtained by Developer for the Development, and for the operation of the Development at the Portion B Area, of any Hazardous Materials on the Portion B Area from the activities of Developer or arising from and after the Closing, or the existence of Hazardous Materials contamination in any state on, under, or about the Portion B Area , from the activities of Developer or arising from and after the Closing. The foregoing ind emnity shall not apply to the condition or use of the Portion B Area prior to the Closing, except and to the extent caused by any conditions which have been caused or exacerbated by any of the Developer Contracting Parties.

In connection with the foregoing, Developer acknowledges that it is aware of and familiar with the provisions of Section 1542 of the California Civil Code that provides as follows:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH

THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS

OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE,

WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY
AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”
As such relates to this Section 1.6.5, Developer hereby waives and relinquishes all rights and benefits that it may have under Section 1542 of the California Civil Code.

Notwithstanding the foregoing, this waiver, discharge, and release shall not be effective in the event the presence or release of Hazardous Materials on the Portion B Area (i) occurs prior to the Closing and which is not caused or contributed to by Developer or (ii) as a result of the gross negligence or willful misconduct of City or their respective officers, employees, representatives and agents.

1.6.6 Environmental Inquiries. Developer sha ll notify City upon receipt, and provide to City a copy or copies, of the following environmental permits, disclosures, applications, entitlements or inquiries relating to the Portion B Area and the Development: notices of violation, notices to comply, ci tations, inquiries, clean up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting requirements and reports filed or applications made pursuant to any Environmental Laws and other applicable Governmental Requirements relati ng to Hazardous Materials and underground tanks, and Developer shall report to City, as soon as possible after each incident, all material information relating to or arising from such incident, including, but not limited to, the following:
(a) All required rep orts of releases of Hazardous Materials, including notices of any release of Hazardous Materials as required by any Governmental Requirements; (b) All notices of suspension of any permits relating to Hazardous Materials;
(c) All notices of violation from federal, state or local environmental authorities relating to Hazardous Materials;
(d) All orders under the State Hazardous Waste Control Act and the State Hazardous Substance Account Act and corresponding federal statutes, concerning investigation, compliance schedules, clean up, or other remedial actions; 838

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(e) All orders under the Porter Cologne Act, including corrective action orders, cease and desist orders, and clean up and abatement orders; (f) Any notices of violation from OSHA or Cal OSHA concerning employees’ exposure to Hazardous Materials;
(g) All complaints and other pleadings filed against Developer relating to Developer’s storage, use, transportation, handling or disposal of Hazardous Materials on or about the Portion B Area; and
(h) Any and all other notices, citations, inquiries, orders, filings or any other reports containing information which would have a materially adverse effect on the Portion B Area or City’s liabilities or obligations relating to Hazardous Materials.

In the event of a release of any Hazardous Materials into the environment, Developer shall, as soon as possible after obtaining knowledge of the release, furnish to City a copy of any and all reports relating thereto and copies of all correspondence with governmenta l agencies relating to the release.

Upon request of City and/or City, but subject to any limitations imposed by law or by court order, Developer shall furnish to City a copy or copies of any and all other environmental entitlements or inquiries relating to or affecting the Portion B Area in Developer’s possession and/or shall notify City of any environmental entitlements or inquiries relating to or affecting the Portion B Area within Developer’s actual or constructive knowledge if Developer is not in possession of same, including, but not limited to, all permit applications, permits and reports including, without limitation, those reports and other matters which may be characterized as confidential.

2. THE PORTION B AREA , SCOPE OF DEVELOPME NT AND SCHEDULE OF

PERFORMANCE

2.1 The Portion B Area. The Portion B Area is described in Attachments No. 1 and No.

2. The Adjacent City Parking Area is not part of the Portion B Area.

2.2 Scope of Development . Developer shall develop the Portion B Area in conformity with the Scope of Development. The Scope of Development is subject to modification from time to time based upon the mutual written agreement of City and Developer; the City Manager is authorized by City to modify the Scope of Development to the extent such modifications ar e not material at the discretion of the City Manager without the need for further action by the City. Subsequent to the Date of Agreement, Developer will be applying to City for zoning action, environmental review associated with the development contemplated by this Agreement, any applicable mapping, and associated land use review. Land use review shall be subject to the customary City public hearing process.

3. DISPOSITION OF THE PORTION A SITE

3.1 Tentative Map and Final Map . City hereby agrees that Developer may file an application for a tentative parcel map and a final parcel map in order to reconfigure the Portion B Area.

Developer shall proce ed with such activities at its cost ; any costs in connection with processing mapping shall be borne by Developer . Developer’s ability to obtain a final parcel map reasonably acceptable to Developer, and the expiration of any applicable appeal periods without a successful appeal, are conditions precedent to the Closing. Developer’s inability to obtain such a final parcel map shall not, to the extent the failure is not attributable to the acts or omissions of Developer, constitute a Default by Developer hereunder.
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3.2 Lease of the Portion of the Portion B Area . All references in this Agreement to acreage are approximate; payments by Developer (including without limitation those payments required under the City Lease) will not change regardless of whether the actual acreage of the Portion B Area differs from the acreage figures set forth in this Agreement. Subject to the conditions and limitations set forth in the foregoing part of this Section 3.2 and further subject to the prior satisfaction of the City Conditions Precedent, the Leasehold Transfer of the Portion B Area is to be accomplished as set forth in Sections 3.2 to 3.5 hereof.

In consideration of City entering into the City Lease, Developer shall pay rent under the City Lease, and shall comply with and cause the use of the Portion B Area to conform to the City Lease and the City Regulatory Agreement throughout the Required Covenant Period.

3.3 Escrow. The parties shall open an escrow (the “City Escrow”) with the Escrow Holder, by the time established therefor in the Schedule of Performance for the Leasehold Transfer, and the recordation and delivery of documents described in Article 3. City and Developer agree to execute such escrow instructions as may be reasonably required to implement this Section 3.3. The obligation of City to deliver the Memorandum of Lease (and a copy of the City Lease), as well as the Notice of Affordability Restrictions and, if not previously recorded, the City Regulatory Agreement, to escrow or to proceed with the Leasehold Transfer is contingent upon the satisfaction of the “ City Conditions Precedent,” as set forth in Section 4.1 of this Agreement.

3.3.1 Costs of Escrow. City and Developer shall pay their respective portions of the premium for the Title Policy as set forth in Section 3.5 hereof, City shall pay for the documentary transfer taxes, if any, due with respect to the Leasehold Transfer, and Developer and City each agree to pay one-half of all other usual fees, charges, and costs which arise from Escrow.

3.3.2 Escrow Instructions. The parties hereto agree to do all acts reasonably necessary to close this Escrow in the shortest possible time. Insurance policies for fire or casualty are not to be transferred, and City will cancel its own policies after the Leasehold Transfer. All funds received in the Escrow shall be deposited with other escrow funds in a general escrow account(s) and may be transferred to any other such escrow trust account in any State or National Bank doing business in the State of California. All disbursements shall be made by check from such account.

If in the opinion of any of Developer, City it is necessary or convenient in order to accomplish the Leasehold Transfer, such party may require that the parties sign supplemental escrow instructions; provided that if there is any inconsistency between this Agreement and the supplemental escrow instructions, then the provisions of this Agreement shall control. The parties agree to execute such other and further documents as may be reasonably necessary, helpful or appropriate to effectuate the provisions of this Agreement. The Leasehold Transfer shall take place when the City Conditions Precedent have been satisfi ed. Escrow Holder is instructed to release City’s escrow closing and Developer’s escrow closing statements to the respective parties.

3.3.3 Authority of Escrow Holder. Escrow Holder is authorized to, and shall:
(a) Pay and charge Developer and City for their respe ctive shares of the premium of the Lessee’s Title Policy as set forth in Section 3.5 and any amount necessary to place title in the condition necessary to satisfy Section 3.4 of this Agreement. (b) Pay and charge Developer and City for their respective shares of any escrow fees, charges, and costs payable under Section 3.3.1 of this Agreement. 840

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(c) Pay and charge Developer for any endorsements to the Lessee’s Title Policy which are requested by Developer.
(d) Disburse funds, record and deliv er the Recordable Documents in the order set forth in Section 3.3.6 and deliver such documents. (e) Do such other actions as necessary to fulfill its obligations under this Agreement.
(f) Prepare and file with all appropriate governmental or taxing authorities a uniform settlement statement, closing statement, tax withholding forms including an IRS 1099 -S form, and be responsible for withholding taxes, if any such forms are provided for or required by law.

3.3.4 Closing. The Leasehold Transfer and delivery of documents related shall close (“Closing”) as soon as feasible following the parties’ satisfaction of all of the City Conditions Precedent, but in no event later than the last day established therefor in the Schedule of Performance.

The Schedule of Performance is su bject to modification from time to time at the mutual concurrence of City and Developer, each acting at its sole discretion. The “Closing” means the time and day that all of the City Regulatory Agreement, the Notice of Affordability Restrictions, and the Memorandum of Lease have been recorded among Official Records. The “Closing Date” means the day on which the Closing occurs. Escrow Holder shall also cause to be recorded among the Official Records a Request for Notice of Default as to each deed of trust hereafter designated by the City Manager to Escrow Holder; provided that the recording of such Notice(s) of Default shall not be a condition precedent to Closing.

3.3.5 Termination. If Escrow is not in condition to close by the time established therefor in the Schedule of Performance, then a party which has fully performed under this Agreement may, in writing, demand the return of money or property and terminate this Agreement. If either party makes a written demand for return of documents or properties, this Agreement shall not terminate until five (5) days after Escrow Holder shall have delivered copies of such demand to all other parties at the respective addresses shown in this Ag reement. If any objections are raised within said five (5) day period, Escrow Holder is authorized to hold all papers and documents until instructed by a court of competent jurisdiction or by mutual written instructions of the parties. Developer, however, shall have the sole option to withdraw any money depo sited by it with respect to the Closing less Developer’s share of costs of Escrow. Termination of the Escrow shall be without prejudice as to whatever legal rights either party may have against the ot her arising from this Agreement. If no timely demands for termination are made, the Escrow Holder shall proceed with the Closing as soon as possible.

3.3.6 Closing Procedure. Escrow Holder shall close Escrow for the Leasehold Transfer as follows:

Record the following documents in this order: (i) the Memorandum of Lease; (ii) the City Regulatory Agreement; ( iii) the Approved Construction and/or Permanent Lender’s deed(s) of trust (including any swap deed(s) of trust which do not provide for cross-collateralization or a change in security); (iv) the Notice of Affordability Restrictions; and ( v) such other instruments, if any, as shall be approved by City Manager (upon consultation with City’s legal counsel) as necessary or convenient to effectuate and implement the initial financing of the Improvements (and the permanent financing thereof), including any mutually approved subordination agreements (provided that the City Regulatory Agreement shall not be subordinated), with instructions for the Recorder of Placer County, California to deliver to City the City Regulatory Agreement, the Memorandum of Lease, and the Notice 841

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of Affordability Restrictions and to deliver a certified copy of each to Developer. The order of recordation shall be subject to revision upon approval of the City Manager; (a) Instruct the Title Company to deliver the Lessee’s Title Policy to Developer, with a copy to City;
(b) File any informational reports required by Internal Revenue Code Section 6045(e), as amended, and any other applicable requirements; (c) Deliver the FIRPTA Certificate, if any, to Developer; (d) Deliver documents as set forth in Section 3.3.3 hereof; and (e) Forward to both Developer and City a separate accounting of all funds received and disbursed for each party and copies of all executed and recorded or filed documents deposited into Escrow, with such recording and filing date and information endorsed thereon.

3.4 Review of Title. City shall cause the Title Company to deliver to Developer a standard preliminary title report (the “Report”) with respect to the leasehold interest in the Portion B Area under the City Lease within thirty (30) business days following the Date of Agreement, and City will endeavor to cause the Title Company to provide to Developer legible copies of the documents underlying the exceptions (“Exceptions”) set forth in the Report at such time. Developer shall have the right to reasonably approve or disapprove the Exceptions; provided, however, that Developer hereby approves the following Exceptions:
(a) The Redevelopment Plan.
(b) The lien of any non -delinquent property taxes and assessments (to be prorated at close of Escrow).
(c) The provisions of the City Regulatory Agreement, the City Lease (and the Memorandum of Lease), and the Notice of Affordability Restrictions. (d) Any incidental easements or other matters affecting title which do not materially impact Developer’s use of the Portion B Area as described in the Scope of Development.

Developer shall have thirty (30) business days from the date of its receipt of the Report to give written notice to City and Escrow Holder of Developer’s approval or disapproval of any of such Exceptions. If Developer notifies City of its disapproval of any Exceptions in the Report, City shall have ten (10) business days from the receipt of written notice of disapproval by Developer to determine whether or not it will undertake the removal of any disapproved Exceptions. If City elects to remove such Exceptions, it shall diligently proceed to effect the removal of such Exceptions, provided that any such Exceptions shall be removed no later than the Closing as a condition precedent to Dev eloper’s obligation to enter into the Lease . If City cannot or does not elect to remove any of the disapproved Exceptions within that period, Developer shall have ten (10) business days after the expiration of such ten (10) business day period to either give City written notice that Developer elects to proceed with the ground leasing of the Portion B Area subject to the disapproved Exceptions or to give City written notice that Developer elects to terminate this Agreement. The Exceptions to title approved by Developer as provided herein shall hereinafter be referred to as the “Condition of Title.” City shall promptly notify Developer of any additional and/or previously unreported Exceptions reported by the Title Company (which are not created by Developer) after Developer has approved the Condition of 842

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Title for the Portion B Area , and Developer shall have the right to approve or disapprove any such additional Exceptions pursuant to the process described in this paragraph as a condition precedent to Developer’s obligation to enter into the City Lease.

3.5 Title Insurance.
(a) Lessee’s Policy of Title Insurance . Concurrently with recordation of the Memorandum of Lease, there shall be issued to Developer an ALTA leasehold owner’s policy (extended coverage) of title insurance (the “Lessee’s Title Policy”), based upo n the City’s or Redevelopment Agency’s original cost to acquire the Portion B Area (or, if different, then-appraised value of the Portion B Area as of the Leasehold Transfer, or, at Developer’s option, an amount equal to the total development costs of the Portion B Area ), together with such endorsements as are reasonably requested by Developer, issued by the Title Company insuring that the title to a leasehold interest in the Portion B Area and fee interest in the Improvements are vested in Developer in the condition required by Section 2.4 of this Agreement. The Title Company shall provide City with a copy of the Lessee’s Title Policy. The Lessee’s Title Policy shall be based upon value described in this section. City shall pay that portion of the premium for the Lessee’s Title Policy equal to the cost of a CLTA standard coverage title policy insuring a leasehold in the amount based upon the City’s or Redevelopment Agency’s original cost to acquire the Portion B Area without regard to any improvements the reto. Any additional costs, including the cost of an ALTA policy or any endorsements requested by Developer, shall be borne by Developer.

3.6 Financing Package . As required herein and as a City Condition Precedent to the Leasehold Transfer, as further set forth in Section 4.1 hereof, Developer shall submit to City evidence that Developer has obtained sufficient equity capital or has arranged for and obtained a binding commitment for construction financing necessary to undertake the development of the Portion B Area and the construction of the Improvements in accordance with this Agreement.

4. CONDITIONS TO DEVELOPER POSSESSION OF THE PORTION A SITE

4.1 City Conditions Precedent. City shall not effect the Leasehold Transfer, as provided pursuant to this Agreement, and Developer shall not take possession of a leasehold interest in the Portion B Area under the Leasehold Transfer (notwithstanding any provision of this Agreement to contrary effect) unless all of the following conditions precedent (the “City Conditions Precedent”) has been fully satisfied, as det ermined in good faith by the City Manager (which condition, if it requires action by Developer, shall also be a covenant of Developer) . City agrees to use diligent, good faith efforts to satisfy those City Conditions Precedent under the control of City. (a) Recording of Certain Documents . Each of the City Regulatory Agreement, the City Lease or a memorandum of lease in form approved by the City Manager, and the Notice of Affordability Restrictions has been delivered to the Title Company for recording ; any documents determined in connection with the Final Financing Package to be executed and delivered in connection with the acquisition of the Portion B Area have been so executed and delivered and, where required to be recorded, have been recorded.
(b) Evidence of Financing . Developer shall have provided written proof acceptable to City that Developer has sufficient internal funds and/or has obtained one or more loans or financing, subject to customary conditions, for construction of the Development, and City has approved such evidence of financing, in accordance with all of Section 6.15 hereof, including that a preliminary reservation of Tax Credits has been obtained for an amount of not less than the Tax Credit 843

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Amount and the City shall have approved a Fi nal Financing Package reflecting a high level of assurance that financing has been secured which is sufficient for the development of the Portion B Area and use at the rent levels and income levels required from all sources of financing as referenced in th e last paragraph of Section 7.2 . In the event Developer obtains a loan or financing for the construction of the Development, such construction loan or financing for the Development shall be ready to close, and shall close, and a portion of proceeds from the sale of Tax Credits, as provided for in this Agreement and under the Final Financing Package, shall be immediately available for use in constructing the Improvements.
(c) Construction Contract. Developer shall have provided to City a signed copy of a stipulated sum or guaranteed maximum price contract between Developer and the general contractor for the construction of the Development, certified by Developer to be a true and correct copy thereof, and City Manager shall have approved such contractor or contractors, and the construction contract or contracts, pursuant to Section 6.15 hereof. City hereby approves Sun Country Builders as the general contractor for the Project; any other contractor shall be subject to approval under Section 6.15.
(d) Payment, Performance and Completion Bonds . Developer or its general contractor shall have obtained payment bonds and performance and completion bonds for the Development, in an amount and from a surety company reasonably acceptable to the City Manager.

All bonds shall be issued by good and solvent sureties qualified to do business in California and shall have a rating of A or better in the most recent edition of Best’s Key Rating Guide. (e) TCAC Approval. All TCAC approvals required in connection with the preliminary reservation of Tax Credits have been obtained in an amount not less than the Tax Credit Amount and remain in full force and effect.
(f) Insurance. City shall have received evidence, satisfactory to City Manager, that all of the insurance policies required by Section 6.5 below as well as coverages required by the City Lease, are in full force and effect.
(g) Parking Plan. Developer shall have submitted and shall have obtained City approval of a plan for parking for the Project. In the event any parking is provided at the Adjacent City Parking Area, no interest will be conveyed, no liens or restrictions may be imposed as to the Adjacent City Parking Area by Developer or any party providing financing for the Project (excepting therefrom City) and parking spaces would be available only on a non-exclusive basis to residents of the Project under a license agreement or other i nstrument acceptable to City. The parking plan shall include provisions for parking for each of residents and visitors to the Portion A Site, the Portion B Area, and members of the general public, as well as a plan for maintenance and operation of the Adjacent City Parking Area.
(h) Reciprocal Easement and Joint Use Agreement. Developer shall have presented and obtained the prior written approval of each of Pacific Street Housing Associates Four, L.P., a California limited partnership and the City to a Reciprocal Easement and Joint Use Agreement that meets all criteria set forth in the definition of Reciprocal Easement and Joint Use Agreement in this Agreement.
(i) Zoning and Land Use Entitlements. Developer shall have zoning and other land use entitlements, as w ell as mapping approval and environmental clearance, that would authorize the development of the Portion B Area consistent with this Agreement. 844

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(j) Representations and Warranties. The representations and warranties of Developer contained in this Agreement shall be correct as of the Leasehold Transfer as though made on and as of that date, and City Manager shall have received a certificate to that effect signed by an officer of Developer.
(k) No Default. No Default by Developer shall have occurred under this Agreement or any other agreement between City and Developer and/or its officers or employees, no event shall have occurred which, with the giving of notice or the passage of time or both, would constitute a Default by Developer under this Agreement, and City Manager shall have received a certificate to that effect signed by an officer of Developer.

All conditions set forth in this Section 4.1, or to City’s obligations hereunder, ar e for City’s benefit only and City Manager may waive all or any part of such rights by written notice to Developer.

If City Manager shall, within the applicable periods set forth herein, disapprove of any of the items which are subject to City’s approval, or if any of the conditions set forth in this Agreement are not met within the times called for, City may thereafter terminate this Agreement without any further liability on the part of City by giving written notice of termination to Developer.

4.2 Developer Conditions Precedent . Developer shall not be obligated to accept the Leasehold Transfer or take possession of a leasehold interest in the Portion B Area under the Leasehold Transfer (notwithstanding any provision of this Agreement to contrary effect) unless all of the following conditions precedent (the “Developer Conditions Precedent”) has been fully satisfied, as determined in good faith by the Developer (which condition, if it requires action by City, shall also be a covenant of City); and the Developer agrees to use diligent, good faith efforts to attempt to satisfy the Developer Conditions Precedent:
(a) Financing Commitments . Developer shall have obtain ed binding commitments for one or more loans or financing, subject to customary conditions, for construction of the Development, and City has approved such evidence of financing, in accordance with all of Section 6.15 hereof, including that a preliminary r eservation of Tax Credits has been obtained for an amount of not less than the Tax Credit Amount and the City shall have approved a Final Financing Package.
(b) TCAC Approval. All TCAC approvals required in connection with the preliminary reservation of Tax Credits have been obtained in an amount not less than the Tax Credit Amount and remain in full force and effect.
(c) Representations and Warranties. The representations and warranties of City contained in this Agreement shall be correct as of the Leasehold Transfer as though made on and as of that date, and Developer shall have received a certificate to that effect signed by an officer of the City.
(d) No Default . No Default by City shall have occurred under this Agreement or any other agreement between City and Developer and/or its officers or employees, no event shall have occurred which, with the giving of notice or the passage of time or both, would constitute a Default by City under this Agreement, and Developer shall have received a certificate to that effect signed by an officer of City.
(e) Condition of the Property. The condition of the Property, including but not limited to the physical condition and the condition of title, shall not be materially different than 845

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that existing as of the Date of Agreement , su bject only to matters caused by the activities of the Developer or any of the Developer Contracting Parties.

All conditions set forth in this Section 4.2, or to Developer’s obligations hereunder, are for Developer’s benefit only and Developer may waive al l or any part of such rights by written notice to City. If Developer shall, within the applicable periods set forth herein, disapprove of any of the items which are subject to Developer’s approval, or if any of the conditions set forth in this Agreement a re not met within the times called for, Developer may thereafter terminate this Agreement without any further liability on the part of Developer by giving written notice of termination to City.

4.2.1 No Subordination of Regulatory Agreements. It is mutually contemplated that the City Regulatory Agreement shall not be subordinated with respect or during the Term of the City Lease. The City Manager, on behalf of City, and the City Manager, on behalf of City, are each delegated the authority to and shall have the right to consider subordination as to periods of time other than the first fifty -five (55) years of the Term upon a compelling showing that: (i) such subordination is necessary to accomplish the financing of the Improvements; (ii) the pa rty or parties requesting such subordination are acting reasonably; (iii) Developer has exhausted all reasonable efforts to successfully accomplish the financing of the Improvements; (iv) the provision of reasonable countervailing consideration to City has been considered and is made available to the extent feasible, such as expansions of the rights of City as set forth under Section 9.6(b) of this Agreement; (v) the resulting terms and conditions reasonably protect the interests of City (as determined by t he City Manager and the City Manager, respectively); and (vi) without limitation as to other rights or remedies of City, City shall have those rights described in Section 9.6(b) of this Agreement. In addition to the foregoing portion of this Section 4.2.1, each of the City Manager and the City Manager is delegated authority to consider, at his or her respective discretion, such requests in connection with the provision of financing for the Development, as may be received to approve (at the discretion of ea ch) accommodations similar to those which have previously been approved by City in connection with other affordable housing transactions within the five (5) years preceding the Date of Agreement.

5. SCOPE OF DEVELOPMENT; INSURANCE AND INDEMNITY, FINANCING

5.1 Scope of Development. Developer shall develop the Improvements in accordance the Entitlements as well as with the Scope of Development, as the Scope of Development may be amended under Section 2.2, and the approved plans, drawings and documents for the Improvements. Plans shall be subject to the City’s development entitlement process, which may include, but is not limited to:
design review, consideration of conditional use permit, lot line adjustment/parcel map, and CEQA compliance. In the event of any inconsistency between the Scope of Development and the plans for the Improvements which have been approved by City, the approved Development plans shall control.

In connection with seeking land use approvals for development of the Portion B Area, Developer shall submit a packet commonly referred to by City as a “Universal Application Package” which will include basic concept drawings (“Basic Concept Drawings”) for development of the Improvements. City will review the Basic Concept Drawings and the remainder of the Universal Application Package as submitted in accordance with the City’s customary process, inclu ding design review consistent with the architectural guidelines for that area designated by City as the “Quarry District.”

5.1.1 Existing Approvals. Prior to the Date of Agreement, Developer has obtained the Entitlements; Developer may construct in conformity with the Entitlements. If any changes are proposed, then, before commencement of construction of the Improvements or other works of improvement upon the Portion B Area (to the extent such construction would rely upon changes after the Entitlements were given in 2025), Developer shall submit to City a Universal Application Package 846

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that will include any plans and drawings (collectively, the “Design Development Drawings”) which may be required by City with respect to any permits and entitlements which are required to be obtained to develop the Improvements, which City shall comment on and return to Developer within thirty (30) days from the date of receipt thereof, or sixty (60) days in the case of design review; if the City takes longer to review plans, times for performance by Developer will be deemed extended by the time in excess of the foregoing time limits . Developer, on or prior to the date set forth in the Schedule of Performance, shall submit to City such plans for the Improvements as required by City in order for Developer to obtain building permits for the Improvements. Within thirty (30) days after City’s disapproval or conditional approval of such plans (or sixty (60) days in the case of design review) , Developer shall revise the portions of such plans identified by City as requiring revisions and resubmit the revised plans to City. Developer shall include in its plans a description of any joint or reciprocal use as between the Portion A Site and the Portion B Area, including without limitation ingress, egress, parking, and the use of common area facilities.

5.1.2 City Review and Approval. City shall have all rights to review and approve or disapprove all Design Development Drawings and other required submittals in accordance with the City Code, and nothing set forth in this Agreement shall be construed to constitute City’s approval of any or all of the Design Development Drawings or other entitlements or to limit or affect City’s review and right to approve, approve subject to conditions, or disapprove Design Development Drawings, plans, drawings, applications, or submittals.

5.1.3 Revisions. Any and all change orders or revisions required by City and its inspectors under the City Code and including without limitation all applicable Uniform Codes (e.g.

Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and regulations shall be included by Developer in its Design Development Drawings and other required submittals and shall be completed during the construction of the Improvements.

5.1.4 Defects in Plans. City shall not be responsible either to Developer or to third parties in any way for any defects in the Design Development Drawings, nor for any structural or other defects in any work done according to the approved Design Development Drawings, nor for any delays reasonably caused by the review and approval processes established by this Section 5.1.4.

5.1.5 Land Use Approvals. Developer has obtained the Entitlements. If any changes are proposed, then before commencement of construction of the Improvements or other works of improvement upon the Portion B Area, Developer shall, at its own exp ense, secure or cause to be secured any and all land use and other entitlements, permits, and approvals which may be required for the Improvements by City or any other governmental agency affected by or having jurisdiction over such construction or work, except for those which are the responsibility of City to the extent, if any, as set forth herein, including without limitation a license agreement between Developer and City allowing entry onto the Portion B Area which indemnifies the Indemnitees from any claims made in connection with the activities of Developer. Developer shall, without limitation, apply for and secure, and pay all costs, charges and fees associated therewith, all permits and fees required by City, the County of Placer, and other governmental agencies with jurisdiction over the Improvements.

5.2 Time of Performance; Progress Reports . Developer shall submit all Design Development Drawings, commence and complete all construction of the Improvements, and satisfy all other obligations and conditions of this Agreement within the times established therefor in this Agreement. Construction of the Improvements shall be commenced on or before the time established therefor in the Schedule of Performance. Once construction is commenced, it shall continuously and diligently be pursued to completion and shall not be abandoned for more than thirty (30) days except 847

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when due to causes beyond the control and without the fault of Developer as set forth in Section 8.10.

During the course of construction and prior to issuance of the Certificate of Completion, Developer shall provide timely reports of the progress of construction when requested by the City Manager .

Developer shall complete construction of all of the Improvements on the Portion B Area within twenty (20) months after the first to occur of (i) commencement of construction or (ii) the time established by this Agreement for commencement of construction.

5.3 Cost of Development. The cost of planning, designing, developing, and constructing the Improvements and the cost of any mapping the Portion B Area shall be borne solely by Developer.

All fees imposed by any governmental entity in connection with the acquisition of the Portion B Area or the development of the Improvements shall be borne by Developer and shall be paid when due by Developer. City shall be responsible for and bear the costs, if any, associated with the application of Relocation Laws to the Development to the extent described above within the definition of “Relocation”. In addition, in the event City desires to rent all or a portion of the Portion B Area for a period commencing after the Date of Agreement (“Post -Agreement Rentals”), any Post -Agreement Rental shall not interfere with Developer’s rights under this Agreement, and City shall be responsible for compliance with Relocation Laws with respect to any such Post -Agreement Rentals in a manner which will not delay or otherwise interfere with the Closi ng or Developer’s development of the Improvements, including but not limited to a requirement that the Portion B Area shall be free of all rights of occupancy or possession in any third parties no later than the Closing.

5.3.1 Impact Fees. Developer shall pay t o City, or cause to be disbursed by the lender making the Primary Construction Loan to City, all of the City Impact Fees not later than concurrently with the closing of the Primary Construction Loan.

5.4 [RESERVED].

5.5 Insurance Requirements. Commencing as of Leasehold Transfer and continuing throughout the Required Covenant Period, and, in addition at all times during which Developer is conducting work on the Portion B Area or any portion thereof, including times prior to the Leasehold Transfer, Developer shall maintain at Developer’s sole expense, with insurers reasonably approved by City, the following policies of insurance in form and substance reasonably satisfactory to City: (i) at all times commencing with the Leasehold Transfer and continuing throughout the Required Covenant Period, Developer shall provide those coverages described in the Insurance During Remainder of Term; and (ii) at all times during the period com mencing with the Leasehold Transfer and ending as of end of the Required Covenant Period when construction is taking place on the Portion B Area, the Developer shall additionally provide those coverages set forth in the Insurance During Construction.

5.6 Obligation to Repair and Restore Damage Due to Casualty. If during the period of construction the Improvements shall be totally or partially destroyed or rendered wholly or pa rtly uninhabitable by fire or other casualty required to be insured against and recoverable by insurance proceeds held by such policy(ies) maintained by Developer, Developer shall proceed to obtain insurance proceeds as soon as practicable and take all steps necessary to begin reconstruction and, as soon as practicable upon receipt of insurance proceeds, to commence the repair or replacement of the Improvements to substantially the same condition as the Improvements are required to be constructed pursuant to this Agreement, whether or not the insurance proceeds are sufficient to cover the actual cost of repair, replacement, or restoration, and Developer shall complete the same as soon as practicable thereafter so that the Improvements can be occupied as an a ffordable housing project in accordance with this Agreement. City acknowledges that the availability of insurance proceeds is subject to rights of the Investor and the Approved Construction Lender. In no event shall the repair, 848

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replacement, or restoration period exceed thirty (30) months from the date Developer obtains insurance proceeds unless the City Manager, in his or her sole and absolute discretion, approves a longer period of time. City shall cooperate with Developer, at no expense to City, in obtaining any governmental permits required for the repair, replacement, or restoration. If, however, then-existing laws of any other governmental agencies with jurisdiction over the Portion B Area do not permit the repair, replacement, or restoration, Developer may elect not to repair, replace, or restore the Improvements by giving notice to City (in which event Developer will be entitled to all insurance proceeds after paying to City from such proceeds an amount equal to any assistance expended by City but Developer shall be required to remove all debris from the Portion B Area ) or Developer may reconstruct such other improvements on the Portion B Area as are consistent with applicable land use regulations and approved by City and the other governmen tal agency or agencies with jurisdiction, and City may pursue remedies of its choosing under this Agreement, including without limitation termination.

5.7 Indemnity. Developer shall defend (by counsel satisfactory to City), indemnify and save and hold harmless City and their officers, contractors, agents and employees (collectively, the “Indemnitees”) from and against all claims, damages, demands, actions, losses, liabilities, costs and expenses (including, without limitat ion, attorneys’ fees and court costs) arising from or relating to:
(i) Developer’s performance of its obligations under this Agreement; (ii) a claim, demand or cause of action that any person has or asserts against Developer; (iii) any act or omission of Developer, any contractor, subcontractor or material supplier, engineer, architect or other person under Developer’s control or under contract with Developer with respect to the Portion B Area; (iv) the conditions, use, condition of title, or any claims associated with the acquisition by CHW or Developer of the Developer Area, the transfer of the Developer Area to City, or the transfer by City of a leasehold interest in the Developer Area under this Agreement; or (v) Developer’s ownership, occupancy or use of the Portion B Area, including without limitation tenant selection. Notwithstanding the foregoing, Developer shall not be obligated to indemnify the Indemnitees with respect to the consequences of any act of gross negligence or willful misconduct of any of the Indemnitees. Developer’s obligations under this Section 5.7 shall survive the issuance of the Certificate of Completion and termination of this Agreement; the requirements under this Section 5.7 are in addition to and do not limit the obligations of Developer under the City Lease.

Developer shall reimburse City immediately upon written demand for all costs reasonably incurred by City (including the reasonable fees and expenses of attorneys, accountants, appraisers and other consultants, whether the same are independent contractors or employees of City) in connection with the enforcement of the Project Documents and all related matters including the following:
(a) City’s commencement of, appearance in, or defense of any action or proceeding purporting to affect the rights or obligations of the parties to any Project Document, and (b) all claims, demands, causes of action, liabilities, losses, commissions and other costs against which City is indemnified under the Project Documents. Such reimbursement obligations shall bear interest based upon the amounts and times of disbursement by City, provided that City gives written demand to Developer at the Applicable Interest Rate. Such reimbursement obl igations shall survive the issuance of the Certificate of Completion and termination of this Agreement and are in addition to and do not limit the obligations of Developer under the City Lease.

Developer shall indemnify City from any real estate commissions or brokerage fees which may arise from this Agreement or the Portion B Area, including without limitation the acquisition of the Portion B Area by Developer, or the leasing of dwelling units on the Portion B Area ; in addition, Developer shall indemnity City from any real estate commissions or brokerage fees which may arise from the acquisition by CHW (or Developer) of the Developer Area or the conveyance by CHW (or Developer) of the Developer Area to City.
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In addition, and without limitation to the foregoing, Developer agrees to indemnify, defend and hold City harmless from and against any claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense (including, without limitation, reasonable attorneys’ fees), resulting from, arising out of, or based upon (i) the presence, release, use, generation, discharge, storage or disposal of any Hazardous Materials on, under, in or about, or the transportation of any such Hazardous Materials to or from, the Portion B Area caused or contributed to by Developer or which occurs after the Closing, or (ii) the violation, or alleged violation, by Developer or anyone acting by or through Developer, of any statute, ordinance, order, rule, regulation, permit, judgment or license relating to the use, generation, release, discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or from, the Portion B Area which is caused or contributed to by Developer or which occurs after the Closing. This indemnity shall include, without limitation, any damage, liability, fine, penalty, parallel indemnity after closing cost or expense arising from or out of any claim, action, suit or proceeding for personal injury (including sickness, disease or death), tangible or intangible property damage, compensation for lost wages, business income, profits or other economic loss, damage to the natural resource or the environment, nuisance, contamination, leak, spill, release or other adverse effect on the environment. At the request of Developer, City shall cooperate with and assist Developer in its defense of any such claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense; provided that City shall not be obligated to incur any expense in connection with such cooperation or assistance.

Notwithstanding anything contained herein to the contrary, Developer shall not indemnify City for any claims arising from City’s gross and active negligence or City’s willful misconduct.

5.8 Rights of Access. Prior to the issuance of the Certificate of Completion, for purposes of assuring compliance with this Agreement, representatives of City shall have the right of access to the Portion B Area , without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including but not limited to, the inspection of the work being performed in constructing the Improvements so long as City representatives comply with all safety rules. City representatives shall, except in emergency situations, notify Developer prior to exercising its rights pursuant to this Section 5.8. In addition, representatives of City shall have access to the Portion B Area in connection with the enforcement of laws, including without limitation the City Code to the extent used in connection with the exercise of police powers of City without regard to any limitations otherwise set forth in this Section 6.8.

5.9 Compliance With Laws . Developer shall carry out the design, construction and operation of the Improvements in conformity with all applicable laws, including all applicable state labor standards and federal prevailing wage laws (including without limitation provisions for payment of prevailing wages in connection with all construction of the Improvements to the extent applicable), the City zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the City Code, and the Fair Housing Act, 42 U.S.C. Section 3601 et seq. (and 24 C.F.R. Part 100), the Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., the Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards Code, Health and Safety Code Section 18900, et seq. Developer, including but not limited to its contractors and subcontractors, shall comply with Labor Code Section 1720, et seq., and its implementing regulations, regarding the payment of prevailing wages (the “State Prevailing Wage Law”) and, if applicable, federal prevailing wage law (“Federal Prevailing Wage Law” and, together with State Prevailing Wage Law, “Prevailing Wage Laws”) with regard to the construction of the Improvements, but only if and to the extent such sections are applicable to the development of the Improvements. Developer shall be solely responsible for determining and effectuating compliance with any applicable Prevailing Wage Laws, and City make s no final representation as to the applicability or non -applicability of the 850

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Prevailing Wage Laws to the Improveme nts, or any part thereof. Developer hereby releases from liability, and agrees to indemnify, defend, assume all responsibility for and hold each of City, and their respective officers, employees, agents and representatives, harmless from any and all claims, demands, actions, suits, proceedings, fines, penalties, damages, expenses resulting from, arising out of, or based upon Developer’s acts or omissions pertaining to the compliance with the Prevailing Wage Laws for the Improvements.

Without limitation as to Section 5.7 of this Agreement, Developer shall indemnify, protect, defend and hold harmless 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 attorney’s fees, court and litigation costs, and fees of expert witnesses) which, in connection with the development, construction, 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 fe deral and/or state labor laws (including, without limitation, if applicable, the requirement to pay state prevailing wages and/or federal prevailing wages); (2) the implementation of Section 1781 of the Labor Code, as the same may be amended from time to time, or any other similar law; and/or (3) failure by Developer to provide any required disclosure or identification as required by Labor Code Section 1781, as the same may be amended from time to time, or any other similar law. It is agreed by the parties that, in connection with the development of the Improvements, including, without limitation, any and all public works (as defined by applicable law), Developer shall bear all risks of payment or non -payment of prevailing wages under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar law. “Increased costs,” as used in this Section 5.9, shall have the meaning ascribed to it in Labor Code Section 1781, as the same may be amended from time to time. The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the construction and development of the Improvements by Developer.

5.10 Nondiscrimination in Employment. Developer certifies and agrees that all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding companies are and will be treated equally by it without regard to, or because of race, color, religion, ancestry, national origin, sex, sexual orientation, age, pregnancy, childbirth or related medical condition, medical condition (cancer related) or physical or mental disability.

5.11 Taxes and Assessments. Subject to Developer’s right to contest taxes and assessments as provided in Section 7.2(c) of the City Lease, Developer shall pay prior to delinquency all ad valorem real estate taxes and assessments on the Portion B Area. Developer shall remove or have removed any levy or attachment made on any of the Portion B Area or any part thereof which is owned or leased by Developer, or assure the satisfaction thereof within a reasonable time, but in no event to exceed sixty (60) days. Developer shall additionally defend, indemnify, and hold harmless City from and against any taxes, assessments, mechanic’s liens, claims of materialmen and suppliers, or other claims by private parties in connection with (a) activities undertaken by Developer or (b) the Portion B Area.

5.12 Liens and Stop Notices. Developer shall not allow to be placed on the Portion B Area or any part thereof any lien or stop notice. If a claim of a lien or stop notice is given or recorded affecting the Improvements Developer shall within thirty (30) days of such recording or service or within five (5) days of City’s demand whichever last occurs:
(a) pay and discharge the same; or
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(b) affect the release thereof by recording and delivering to City a surety bond in sufficient form and amount, or otherwise; or
(c) provide City with indemnification from the Title Company against such lien or other assurance which City deems, in its sole discretion, to be satisfactory for the payment of such lien or bonded stop notice and for the full and continuous protection of City from the effect of such lien or bonded stop notice.

5.13 Certificate of Completion. Within fifteen (15) days after receipt of written request by Developer after completion of the Improvements in conformity with this Agreement, City shall furnish Developer with a “Certificate of Completion,” substantially in the form of attached hereto.

City shall not unreasonably withhold such Certificate of Completion. The Certificate of Completion shall be a conclusive determination of satisfactory completion of the Improvements and the Certificate of Completion shall so state. If City refuses or fails to timely furnish a Certificate of Completion after written request from Developer, the Certificate of Completion shall be deemed to have been issued unless City shall, within fifteen (15) days of receipt of written request therefor, provide Developer with a written statement of the reasons City refused or failed to furnish the Certificate of Completion. The statement shall also contain City’s opinion of the actions Developer must take to obtain the Certificate of Completion. The Certificate of Completion is not a notice of completion as referred to in Section 3093 of the California Civil Code.

5.14 Further Assurances . Developer sh all execute and acknowledge (or cause to be executed and acknowledged) and deliver to City all documents, and take all actions, reasonably required by City from time to time to confirm the rights created or now or hereafter intended to be created under the Project Documents or otherwise to carry out the purposes of the Project Documents.

5.15 Financing of the Improvements . Financing shall be provided consistent with the Proof of Financing Commitments.

5.15.1 Approval of Financing. As required herein and as an City Condition Precedent to the Leasehold Transfer, Developer shall submit to City evidence reasonably satisfactory to the City Manager that Developer has obtained sufficient equity capital or has arrang ed for and obtained a binding commitment for construction financing which is necessary to undertake the development of the Portion B Area and the construction of the Improvements in accordance with this Agreement (“Proof of Financing Commitments”). This requirement shall be implemented as follows:
on or before the time set forth in the Schedule of Performance for the recording of documents, but not later than thirty (30) days prior to Closing, and prior to taking possession of the Portion B Area , Developer shall submit to the City Manager a proposed final financing package (the “Initial Proposed Financing Package”) which identifies all funding, including sources, amounts, timing and mechanics for disbursement, sufficient to finance the development of the Improvements in conformity with this Agreement. While the Base Pro Forma sets forth initial financing assumptions, it is mutually acknowledged that Developer may seek additional funding sources and that the actual proposed financing may vary from that described in the Base Pro Forma. Upon receipt of such submittal from Developer of the Initial Proposed Financing Package, the City Manager (and nominees of his choosing for this purpose) will review the Initial Proposed Financing Package and will conf er with Developer regarding the Initial Proposed Financing Package. The City Manager may make suggestions and propose modifications or substitutions to the Initial Proposed Financing Package. The parties contemplate that more than one submittal may be necessary to achieve a submitted financing package that is approved by the City Manager, and that a consultative process shall occur in connection with each such submittal. At such point as the City Manager may determine, in his or her discretion, to 852

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approve a proposed financing package, upon approval by the City Manager, such financing package shall be referred to as the “Final Financing Package.” Attachments hereto shall be subject to change by the terms of the Final Financing Package. The Initial Financing Package and the Final Financing Package shall include the provisions of Section 9.6(c) of this Agreement.

By its approval of this Agreement, the City Council of the City has delegated to the City Manager full authority to make all determinations on behalf of City for all purposes of Section 5.15, including all subparts thereof.

The parties intend that Developer is to obtain equity financing for the construction and operation of the Development including the use of Tax Credits (in an amount of not less than the Tax Credit Amount) and obtaining capital contributions from limited partners in the Development in consideration primarily for the receipt of the Tax Credits received by Developer with respect to the Development.
(a) Required Financing Submittals; Submittal of Construction Contract .

Such evidence of financing for the Development and readiness to commence construction of the Development shall include all of the following:
(i) An updated pro forma and final development budget for the Development, includi ng the Initial Proposed Financing Package, showing the projected costs of construction of the Development, including all on site and offsite improvements to be constructed in connection therewith.
(ii) A copy of the lender’s firm commitment obtained by Developer for the Primary Construction Loan for the Development and, when available, copies of all loan documents evidencing the Primary Construction Loan therefor. The Primary Construction Loan commitments for financing shall be in such form and content acceptabl e to City and its financial advisor(s) and its legal advisor(s) and as such reasonably evidences a legally binding, firm and enforceable commitment, subject only to the Lender’s customary and normal conditions and terms and subject to the requirements of this Section 5.15. Developer shall provide written certification to City that the loan documents submitted are substantially in the form of the actual loan documents to be executed by Developer concurrently with the Closing. If the Lender requires a subor dination agreement between or among Lender, City and/or Developer, concerning the relative priority among deed of trust, City shall review the form of subordination subject to the reasonable review and approval of the City Manager and legal counsel(s).
(iii) A c urrent certified financial statement of Developer (and all partners and members thereof, except the Investor Limited Partner) and/or other documentation satisfactory to City as evidence of other sources of capital sufficient to demonstrate that Developer has adequate funds to cover the difference, if any, between construction and completion costs, and the financing authorized by the Tax Credits, Primary Construction Loan, and any additional subsidies, sources of funding, or financing obtained by Developer for the development of the Development. (iv) Copies of the construction contract(s).

City, which may act through its City Manager, shall have the right to approve or disapprove such evidence of financing within fifteen (15) business days of submission by Developer to City of all complete items required by this Section 6.15 or as otherwise reasonably imposed by Developer’s financing and such approval or disapproval shall be provided not less than fifteen (15) 853

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business days prior to the date scheduled for the Closing (so long as City has had no fewer than thirty (30) days for review of a complete submittal). Failure by City to approve evidence of financing within such time period shall constitute disapproval unless otherwise agreed between City and Developer. In this regard, Developer agrees it shall use best efforts to cause its Primary Construction Lender to timely provide complete drafts of documents for review by City and its legal counsel(s) to perform wit hin such time frames. Approval shall not be unreasonably withheld or conditioned. If City disapproves any such evidence of financing, City shall do so by written notice to Developer stating the reasons for such disapproval and Developer shall promptly ob tain and submit to City new evidence of financing within reset but equal time periods. If Developer’s submission of new evidence of financing is timely and complete and provides City with adequate time to review such evidence within the times established in this Section 5.15, City shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 5.15 for the approval or disapproval of the evidence of financing as submitted to City initially. The Closing shall be extended as necessary to accommodate the time necessary to obtain the City Manager’s approval hereunder.

The evidence of financing shall be deemed to be an ongoing representation by Developer that the sum total of all sources of financing are at least equal to the amount of the approved Project costs as set forth in the Final Development Budget for the Development and that such Final Development Budget conforms to the Tax Credit Applications and the preliminary reservation of Tax Credits, and any and all updates thereto submitted by Developer to TCAC. Once the complete evidence of financing is approved by City, Developer shall promptly notify City in writing of any change in, additional conditions to, or additional sources of financing, including without limitation, the award of state or federal Tax Credits, and any updates or additional information material or relevant to such financing and/or the Tax Credits. The representations made by Developer with respect to the budgets and cost s for the Development and the sources of funding and method of financing for the Development, inclusive of all submittals and information related to the Tax Credits, were and remain the basis used by City to negotiate the financial terms of this Agreement. (b) Tax Credit Equity. Developer has indicated that it has obtained equity financing for the construction and operation of the Development including the use of Tax Credits and obtaining capital contributions from Limited Partners in Developer in consideratio n primarily for the receipt of the Tax Credits received by Developer with respect to the Development. The following requirements must be satisfied in order for the equity financing for Tax Credit funding for the Development to be approved by City pursuant to this Section 5.15:
(i) Developer understands and agrees that Developer and/or CHW may be required to provide an operating deficit guaranty, tax credit recapture guaranty, and/or other guaranties which may be required with respect to the Limited Partners’ investment in the Development.

If required for such financing, the execution of such guaranties shall be an additional City Condition Precedent for the purposes of Section 4.1.
(ii) Developer shall submit the following documents as evidence of financing prior to the time set forth in the Schedule of Performance for the recording of documents, but not later than the Closing: (a) a copy of a legally binding, firm and enforceable loan commitment(s) or approval(s) obtained by Developer from unrelated finan cial institutions for the mortgage loan or loans for financing to fund the construction of the Development, subject to such lenders’ reasonable, customary and normal conditions and terms, (b) a limited partnership agreement or funding agreement from the equity investors in the Development which demonstrates that Developer has sufficient funds for such construction, and that such funds have been committed to such construction, and a current financial statement of Developer, (c) a copy of a Preliminary Reserv ation of Tax Credits from the 854

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California Tax Credit Allocation Committee for Tax Credits for the construction of the Development, (d) a binding agreement for the purchase of the Tax Credits, and/or (e) other documentation satisfactory to City as evidence of other sources of capital, all of which together are sufficient to demonstrate that Developer has adequate funds to construct and complete the Development. (iii) The equity investment of the Limited Partners of the limited partnership shall not be less than the approximate prevailing price for 9% Tax Credits at such time, taking into consideration all relevant factors such as timing of required payments , the amount of the Tax Credits, and the market for tax credits at that time. (iv) City acknowledges that a Lease Rider for the benefit of TCAC is contemplated in connection with the award of Tax Credits. . (c) Required Submissions . Developer shall submit the following documents as evidence of Tax Credit financing:
(i) The Partnership Agreement or equivalent funding commitment letter from the equity investors in the Development which demonstrates that Developer has sufficient funds and committed capital/equity for commencement through completion of construction, and that such funds have been committed to construction of the Development, and a current financial statement of Developer.
(ii) A complete copy of each application for Tax Credits sand supporting documentation submitted to TCAC by Developer, within five (5) days foll owing Developer’s submission thereof to TCAC.
(iii) A copy of a preliminary reservation letter from TCAC notifying Developer that an allocation of 9% Tax Credits for not less than the Tax Credit Amount, has been reserved for construction of the Development, and further documentation demonstrating that Developer remains eligible and qualified to receive such allocation, along with certification that there have not been any material changes to the information provided by Developer in the applications for Tax Credits, as defined and referenced in such reservation letters, and that if there are material changes then such information will be provided to TCAC (and City) forthwith. (d) Multifamily Conduit Revenue Bond Financing . Developer contemplates that it will include the issuance of new multifamily housing bonds be issued in connection with the development of the Portion B Area or the operation of the improvements thereon in connection with this Agreement; alternatively, Developer may arrange for accessing proceeds of b onds issued prior to the Date of Agreement. In the event that multifamily housing bonds are considered in connection with the development of the Portion B Area, City being under no obligation to so consider, then, subject to the satisfaction of those requirements set forth in this Section with regard to approval of Proof of Financing Commitment(s), an issue of multifamily conduit revenue bonds (“Bonds”) may be considered by City (or a public financing authority of which City is a member [a “City PFA”]) in connection with the financing of the Improvements (or a Portion thereof). Developer agrees and acknowledges that: (i) the consideration of the issuance of Bonds requires approval after a public hearing of City or Authority, apart from the approval of this Agreement, and that there is no assurance that such approval will be given; (ii) an allocation process administered by an agency of the State of California is required in connection with the issuance of Bonds, and Developer and not City would be fully responsible for preparing application with the participation of City, obtaining approval, and complying with conditions imposed as part of such a process; (iii) if Bonds are issued for the 855

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Development, City (or a City PFA but no other entity) shall be the issuer; (iv) any bonds issued by City in connection with the Development or a portion thereof would only be a conduit issuance, with no liability of City excepting only the payment of moneys received from Developer in accordance with the state law pursuant to which the Bonds are issued, and with credit support in the form of a letter of credit, or other form of credit enhancement reasonably acceptable to City, private placement and one of the ten largest banks in California or another lender approved by the City Manager at his or her discretion, with Bond Counsel as defined herein and advisors and/or underwriters acceptable to City; (v) any bonds issued by City (or City PFA) privately placed, or if publicly sold would be rated, if applicable, by one of the t wo largest rating agencies with one of the three highest investment -grade ratings, and on terms customary and reasonably acceptable to the City Manager; (vi) all costs in connection with the issuance of such bonds, including without limitation costs of issuance, the cost of credit support, ratings, and insurance, shall be borne by Developer directly or as part of the matters funded by the bonds and City or its designee shall be entitled to an issuer’s fee of 1/8 of 1% of the initial principal amount of the Bonds as well as 1/8 of 1% outstanding annually thereafter so long as the bonds are outstanding (or such lesser amount as may hereafter be approved by the City Manager); and (vii) the term of the bond(s) shall not exceed thirty-five (35) years.

The foregoing portion of this paragraph (d) shall not be deemed to preclude the use of proceeds of bonds issued prior to the Date of Agreement so long as the conditions and requirements associated with the use of such bond proceeds are consistent with all provisions of this Agreement. (e) Approval of Financing. As required above in this Section, Developer shall submit to City evidence that Developer has obtained sufficient equity capital and/or has arranged for and obtained a binding commitment for construction financing on then commercially reasonable terms necessary to undertake the development of the Portion B Area and the construction of the Improvements in accordance with this Agreement (“Proof of Financing Commitments”).

City shall reasonably approve or disapprove such evidence of financing within thirty (30) days of receipt of each of the respective submittals, provided that such submittal is complete.

Approval shall not be unreasonably withheld so long as the terms and conditions of the financing are consistent with this Agreement, including without limitation the availability of the Tax Credit Amount and the acknowledgment and consent by such lender to City Regulatory Agreement as senior encumbrances, with the further proviso that if the Tax Credit Amount exceeds the amount set forth therefor on the Base Pro Forma, Developer shall agree that the excess remaining after applying amounts necessary to defray Cost Overrun Amounts theretofore experienced or the Developer Fee (the “Excess Amount”) shall be applied first t o fund the Operating Reserve and the Capital Replacement Reserve and, to the extent that any surplus remains, to pay the Deferred Developer Fee, then to the extent any surplus remains, to be treated as Gross Revenues under the City Lease; financing terms shall be reasonable and customary. If City shall disapprove any such evidence of financing, City shall do so by Notice to Developer stating the reasons for such disapproval and Developer shall endeavor to promptly obtain and submit to City new evidence of financing. City shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 5.15 for the approval or disapproval of the evidence of financing as initially submitted to City.

Developer shall close the approved Tax Credit financing prior to or concurrently with the Closing.

The Proof of Financing Commitment shall include a copy of a legally binding, firm and enforceable loan commitment(s) obtained by Developer from one or more financial institutions for the mortgage loan or loans for financing to fund the construction and completion of the Improvements.
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The parties intend that Developer is to obtain equity financing for the construction and operation of the Development including the use of Tax Credits (in an amount of not less than the Tax Credit Amount) and obtaining capital contributions from limited partners in the Development in consideration primarily for the receipt of the Tax Credits received by Developer with respect to the Development.

In no event shall City be obligated to provide any financial assistance or subsidy to the Development other than as expressly set forth in this Agreement. City shall have no obligation to make any expenditures under this Agreement.

Developer understands and agrees that Developer and/or CHW may be required by third party lenders to provide an operating deficit guaranty, tax credit recapture guaranty, and/or other guaranties which may be required with respect to the limited partners’ investment in the Development. If required for such financing, the execution of such guaranties shall be an additional condition precedent for the purposes of Section 4.1.

Developer shall submit the following documents as evidence of financing:
(a) a copy of a firm loan commitment(s) or approval(s) obtained by Developer from unrelated financial institutions for the mortgage loan or loans for financing to fund the construction of the Development, subject to such lenders’ reasonable, customary and normal c onditions and terms, (b) a limited partnership agreement or funding agreement from the equity investors in the Development which demonstrates that Developer has sufficient funds for such construction, and that such funds have been committed to such construction, and a current financial statement of Developer and Developer’s other sources of equity capital, (c) a copy of a preliminary reservation of Tax Credits (and when available, the final reservation of Tax Credits) from the California Tax Credit Allocati on Committee for Tax Credits for the construction of the Development (or other evidence satisfactory to the City Manager that Tax Credits will be available), (d) a binding agreement for the purchase of the Tax Credits, and (e) such other documentation as m ay be reasonably necessary to satisfy City as to the availability, commitment and adequacy of other sources of capital, all of which together are sufficient to demonstrate that Developer has adequate funds committed for the construction and completion of the Development.

5.15.2 No Encumbrances Except Mortgages, Deeds of Trust, or Sale and Lease Back for Development. Mortgages, deeds of trust and subleases and subleases back on Developer’s (or Approved Assignee’s) leasehold (but not as to the underlying fee) shall be permitted before the completion of the Improvements only with City’s prior written approval, but only for the purpose of securing loans of funds to be used for financing the construction of the Improvements (including architecture, engineering, legal, construction period carrying costs such as property taxes, insurance and interest, and related direct costs as well as indirect costs) on or in connection with the Portion B Area, and the obtaining of a permanent loan (as well as swap contracts, if any, en tered into in connection therewith which are consistent with the terms of this Agreement concerning no cross - collateralization or change in security) in the amount of the outstanding balance of the construction loan. In no event, however, shall the amoun t or amounts of indebtedness secured by mortgages or deeds of trust on Developer’s leasehold interest as to the Portion B Area exceed the projected Developer’s cost, as evidenced by a pro forma and a construction contract which have been approved by the Ci ty Manager in accordance with this Agreement and which set forth such costs, unless the written approval of the City Manager is first obtained. Developer shall notify City in advance of any mortgage, deed of trust or sublease and sublease back financing, if Developer proposes to enter into the same before completion of the construction of the Improvements. The words “mortgage” and “trust 857

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deed” as used hereinafter shall include sublease and sublease back. No liens shall be permitted on City’s fee interest in the Portion B Area.

5.16 Holder Not Obligated to Construct Improvements. The holder of any mortgage or deed of trust on Developer’s leasehold interest authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct, complete, or operate the Improvements or any portion thereof, or to guarantee such construction, completion or operation; nor shall any covenant or any other provision in this Agreement be construed so to obligate such holder. Nothing in this Agreement shall be deemed to permit or authorize any such holder to devote the Portion B Area to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement.

5.17 Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure . With respect to any mortgage or deed of trust granted by Developer as to its leasehold interest as provided herein, whenever City may deliver any notice or demand to Developer with respect to any breach or default by Developer under this Agreement, City shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand; provided that the failure to notify any holder of record shall not vitiate or affect the effectiveness o f notice to Developer. Each such holder shall (insofar as the rights granted by City are concerned) have the right, at its option, within sixty (60) days after the receipt of the notice, or such longer time as expressly provided for a cure under this Agreement, to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage or deed of trust. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the Improvements, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction alrea dy made) without first having expressly assumed Developer’s obligations to City by written agreement reasonably satisfactory to City. The holder, in that event, must agree to complete, in the manner provided in this Agreement, the improvements to which the lien or title of such holder relates, but on a schedule which takes into account the time reasonably required for the holder to obtain title to and possession of Developer’s leasehold interest in the Portion B Area, analyze and negotiate amendments to plans, specifications, construction contracts and operating contracts or to negotiate new construction contracts and operating contracts. Any such holder properly completing such improvement shall be entitled, upon compliance with the requirements of Section 6.13 of this Agreement, to a Certificate of Completion. It is understood that a holder shall be deemed to have satisfied the sixty (60) day time limit set forth above for commencing to cure or remedy a Developer default which requires title and/or possession of Developer’s leasehold interest in the Portion B Area (or portion thereof) if and to the extent any such holder has within such sixty (60) day period commenced proceedings to obtain title and/or possession and thereafter the holder diligently pursu es such proceedings to completion and cures or remedies the default. The City Manager is authorized to consent, on behalf of City, to the provision of similar cure rights to the limited partner as reasonably requested by the tax credit investor.

5.18 Failure o f Holder to Complete Improvements . In any case where, one hundred eighty (180) days after the holder of any mortgage or deed of trust creating a lien or encumbrance upon the Portion B Area (or leasehold interest therein) or any part thereof receives a notice from City of a default by Developer in completion of construction of any of the Improvements under this Agreement, and such holder is not vested with ownership of Developer’s leasehold interest in the Portion B Area and has not exercised the option to construct as set forth in Section 5.17, or if it has exercised the option but has defaulted hereunder and failed to timely cure such default, in addition to such other rights and remedies as City shall have, City may purchase the mortgage or deed of trust by payment to the holder 858

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of the amount of the unpaid mortgage or deed of trust debt, including principal and interest and all other sums secured by the mortgage or deed of trust. If th e ownership of the Portion B Area (or Developer’s leasehold interest therein) or any part thereof has vested in the holder, City, if it so desires, shall be entitled to a conveyance from the holder to City upon payment to the holder of an amount equal to the sum of the following:
(a) The unpaid mortgage or deed of trust debt at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings); (b) All expenses with respect to foreclosure including reasonable attorneys’ fees;
(c) The net expense, if any, incurred by the holder as a direct result of the subsequent management of the Portion B Area or part thereof; (d) The costs of any improvements made by such holder;
(e) An amount equivalent to the interest that would have accrued at the rate(s) specified in the holder’s loan documents on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by City; and
(f) Any customary prepayment charges imposed by the lender pursuant to its loan documents and agreed to by Developer.

The foregoing rights shall supplement and not limit City’s rights as landlord under the City Lease or by operation of law.

5.19 Right of City to Cure Mortgage or Deed of Trust Default. In the event of a mortgage or deed of trust defaul t or breach by Developer whether prior to or after the completion of the construction of any of the Improvements or any part thereof (continuing until the expiration of the term of the City Lease), Developer shall immediately deliver to City a copy of any mortgage holder’s notice of default. If the holder of any mortgage or deed of trust has not exercised its option to construct, City shall have the right but no obligation to cure the default. In such event, City shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by City in curing such default.

Developer agrees to provide documentation evidencing the relinquishment of any and all rights to the Development and under the City Lease in such event; provided that the failure to provide such documentation shall not be construed to mean that Developer retains any rights under the Agreement or the City Lease.

6. COVENANTS AND RESTRICTIONS

6.1 Use Covenants. Developer covenants and agrees for itself, its successors, assigns, and every successor in interest to the Portion B Area or any part thereof, that Developer shall devote the Portion B Area to the uses specified in and shall operate in conformity with this Agreement, the City Regulatory Agreement, and the City Lease , whichever is the more restrictive in each case unless expressly provided to contrary effect herein. All uses conducted on the Portion B Area , including, without limitation, all activities undertaken by Developer pursuant to this Agreement, shall conform to the Redevelopment Plan and all applicable provisions of the City Code. 859

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6.2 Affordable Housing Requirements.

6.2.1 Number of Required Affordable Units and Other Units. Developer agrees to make available, restrict occupancy to, and rent all of the Required Affordable Units at Affordable Rent. There shall be sixty (60) multifamily rental units developed on the Portion B Area as follows (i) for six (6) one bedroom Units, thirty percent (30%) of Median Income; (ii) for two (2) two bedroom Units, thirty percent (30%) of Median Income; (iii) for six (6) two-bedroom Units, thirty percent (30%) of Median Income; (iv) for thirteen (13) one bedroom Units, fifty percent (50%) of Median Income; (v) for five (5) two bedroom Units, fifty percent (50%) of Median Income; (vi) for six (6) three bedroom Units, fifty percent (50%) of Me dian Income; (vii) for five (5) one bedroom Units, sixty percent (60%) of Median Income; (viii) for eight (8) two bedroom Units, sixty percent (60%) of Median Income; and (ix) for eight (8) three bedroom Units, sixty percent (60%) of Median Income. There shall additionally be one manager’s unit; the manager’s unit shall not be restricted on the basis of income. The restriction of Units in connection with requirements for tax credits, so long as those requirements do not supersede the requirements imposed u nder this Agreement, shall not be deemed to constitute a violation of this Agreement. An example of the calculation of Affordable Rent for the Units is attached hereto as Attachment No. 7 and incorporated herein; however, it is contemplated that rents consistent with the use of Tax Credits will be utilized in connection with the Development. In the event TCAC imposes greater affordability requirements, this Agreement and the attachments hereto will be conformed to meet such requirements.

6.2.2 Duration of Affor dability Requirements. The Required Affordable Units shall be maintained as rental units available at and rented to Extremely Low Income Households, and Lower Income Households throughout the Required Covenant Period, as more particularly set forth in the City Regulatory Agreement.

6.2.3 Tenant Selection and Tenant Services Plan; Selection of Tenants. Prior to the issuance of the Certificate of Completion for the Improvements, Developer shall prepare and submit to the City Manager a plan concerning the marketing to and selection of tenants (“ Tenant Selection and Tenant Services Plan ”). The Tenant Selection and Tenant Services Plan shall also describe in detail the services to be provided by Developer to residents, and shall deline ate the compensation to be paid for an on-side tenant services administrator to be engaged by the Developer. Developer shall submit to the City Manager within ninety (90) days after the Date of Agreement a draft Tenant Selection and Tenant Services Plan. Upon receipt of such draft Tenant Selection and Tenant Services Plan, the City Manager may approve, conditionally approve or disapprove the draft Tenant Selection and Tenant Services Plan within sixty (60) days after receipt thereof. If the City Manager disapproves or conditionally approves the draft Tenant Selection and Tenant Services Plan , the parties agree to confer with the goal that Developer will revise the draft Tenant Selection and Tenant Services Plan to address, to the extent feasible, concerns raised by the City Manager. If the City Manager fails to approve or disapprove the draft Tenant Selection and Tenant Services Plan by the time set forth therefor in the preceding portion of this Section 7.2.3, City will be estopped to deny the effectiven ess of the draft Tenant Selection and Tenant Services Plan as previously approved as the Final Tenant Selection and Tenant Services Plan. Developer shall be responsible for the selection of tenants for the Required Affordable Units in compliance with the criteria set forth in Section 6.3 of this Agreement and the City Lease.

6.2.4 Income of Tenants. Each tenant shall be a n Extremely Low Income Household or, to the extent provided herein a Lower Income Household which, in accordance with the Prescribed Income Le vels, meets the eligibility requirements established for the corresponding Required Affordable Unit, and Developer shall obtain a certification from each tenant renting or leasing 860

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each housing unit which substantiates such fact. Developer shall verify the income certification of each tenant as set forth in Section 6.3 hereof. Prior to the rental or lease of any Unit on the Portion B Area to a tenant, and annually thereafter, Developer shall submit to City or its designee, at Developer’s expense, a completed income computation and certification form, in a form to be provided by City.

6.2.5 Determination of Affordable Rent for the Required Affordable Units .

Each Required Affordable Unit shall be rented at an “Aff ordable Rent” to be established as follows:

The maximum monthly rental amount for the Required Affordable Units, shall be:
(i) for Extremely Low Income Households, at one -twelfth (1/12) of thirty percent (30%) of thirty percent (30%) of Median Income for th e Area for a household of a size appropriate to the housing unit, or, if lower, the maximum rent for such unit as determined under the City Regulatory Agreement;
(ii) the maximum monthly rental amount for the Required Affordable Units to be rented to Lower Income Households shall be established at one-twelfth (1/12) of thirty percent (30%) of sixty percent (60%) of Median Income for the Area for a household of a size appropriate to the housing unit, or, if lower, the maximum rent for such unit as determined unde r the Regulatory Agreement; or
Affordable Rents shall be subject to annual adjustment based upon the promulgation of figures published concerning Median Income for the Area and income limits as annually published by the California Department of Housing and Community Development (“HCD”); actual rents charged may be less than the maximum amounts determined pursuant to the formulas set forth in the preceding portion of this Section 6.2.5.
“Household size appropriate to the unit,” for the purpose of the calcula tion of rent herein (and without regard to actual occupancy), means an amount equal to the number of bedrooms in the unit plus one (i.e., for a two -bedroom unit, 3 people; for a three -bedroom unit, four people); provided that the maximum monthly rental amount of the Required Affordable Units shall be adjusted annually by the formula set forth above upon the promulgation of revised figures concerning Median Income for the Area by regulation of the California Department of Housing and Community Development (“HCD”). Actual rent charged may be less than such maximum rent.

6.2.6 Relationship to Other Funding Requirements. In the event Developer is required, as a condition of funding imposed by entities other than City, to cause a greater number of Units to be restricted by rent and/or income qualifications, the attachments to this Agreement will be modified to reflect such greater number of Units limited to rental at Affordable Rent to households of the corresponding income lived as determined in accordance with the Calculation of Affordable Rents.

6.2.7 [Reserved].

6.2.8 Income Verification. Developer shall verify the income of each proposed and existing tenant of the Required Affordable Units and all other Units developed on the Portion B Area.

6.2.9 Annual Reports. Following the issuance of the Certificate of Completion, and on or before July 15 of each Lease Year commencing after completion of the Improvements, Developer, at its expense, shall submit to City or its designee the reports in the manner described by Health and Safety Code Section 33418, as the same may be amended from time to time, with each such 861

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report to be in the form prescribed by City. Each annual report shall cover the immediately preceding Lease Year.

Developer shall maintain on file each tenant’s executed lease and Income Verification and rental records for all Required Affordable Units developed on the Portion B Area. Developer shall maintain complete and accurate records pertaining to the Required Affordable Units and will permit any duly authorized representative of City to inspect the books and records of Developer pertaining to this Agreement and the Required Affordable Unit s upon reasonable advance notice of not less than twenty four (24) hours and during normal business hours. Developer shall prepare and submit to City (or its designee) annually commencing July 15 following the completion of the Improvements and continuing throughout the Required Covenant Period, a Certificate of Continuing Program Compliance. Such documentation shall state for each Required Affordable Unit the unit size, the rental amount, the number of occupants, and the income of the occupants and any o ther information which may be used to determine compliance with the terms of this Agreement.

As part of its annual report, Developer shall include a statement of amounts payable by Developer under this Agreement (including the City Lease ) supported by an A udited Financial Statement (prepared by an independent accounting firm reasonable acceptable to City) which sets forth information in detail sufficient for adequate review by City for the purposes of confirming those amounts payable by Developer to City as well as showing the general financial performance of the Affordable Housing Project (“Annual Financial Report”). Each Annual Financial Report shall include a profit and loss statement showing Gross Revenues, Operating Expenses, Debt Service, Operating Reserve, Capital Replacement Reserve and Rental Receipts, payments of fees and any other remuneration to Developer all certified by the Audited Financial Statement. In the event the amounts reported or paid deviate by five percent (5%) or more from that amount determined to be owing upon review of Developer’s submittal, Developer shall reimburse City for its cost to review (which may require engagement of auditors) and collect the amounts owing; such amounts shall, until paid, be added to the amounts payable as Additional Rent under the City Lease during the first succeeding Lease Year. Developer agrees to maintain records in businesslike manner, and to maintain such records for the Term of the City Lease. The income and rent restrictions provided for hereunder are intended and shall be maintained in a manner sufficient to satisfy the requirements of Health and Safety Code Section 33413(b) without regard to whether such statute is applicable as a matter of law.

In addition, as part of its annual report and a t City’s request, but not less frequently than prior to each initial and subsequent rental of each Unit to a new tenant household (but not lease renewals) and annually thereafter, Developer shall also provide to City completed income computation, asset eva luation, and certification forms, for any such tenant or tenants, in substantially the form provided by City from time to time. Developer shall obtain an annual certification from each household of each Unit demonstrating that such household is an Extreme ly Low Income Household or a Low Income Household, as applicable, and meets the eligibility requirements established for each such Unit.

Developer shall verify the income certification of each tenant household. In order to comply with this Section 6.2.9, Developer shall submit to City any and all tenant income and occupancy certifications and supporting documentation required to be submitted to TCAC pursuant to the Tax Credit Rules and the Tax Credit Regulatory Agreement for the Project; provided, City may request (and Developer shall provide) additional documentation to assist City’s evaluation of Developer’s compliance with this Agreement, if determined to be necessary in the reasonable discretion of the City Manager, specifically including (without limitation) any documentation or additional certifications that may be necessary to verify compliance with the requirements applicable to funding sources not without to City, as applicable. This requirement is in addition to and does not replace or supersede Developer’s obligation to annually submit the Certificate of Continuing Program Compliance to City. Further, City has the 862

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right, but not the obligation to monitor compliance with respect to each tenant household at the Project, and City’s election to moni tor some, but not all, of the Units shall not constitute a waiver of City’s right to monitor and enforce compliance with respect to all Units in the future.

6.2.10 Verification of Income of New and Continuing Tenants. Gross income calculations for prospective (and continuing) tenants shall be determined in accordance with 25 Cal.

Code Regs. Section 6914 or as required by the Tax Credit Rules. Developer shall verify the income and information provided in the income certification of the proposed tenant as set forth below. (a) Developer shall verify the income of each proposed tenant of the Project and by at least one of the following methods as appropriate to the proposed tenant:
(i) obtain two (2) paycheck stubs from the person’s two (2) most recent pay periods;
(ii) obtain a true copy of an income tax return from the person for the most recent tax year in which a return was filed;
(iii) obtain an income verification certification from the employer of the person;
(iv) obtain an income verification certification from the Social Security Administration and/or the California Department of Social Services if the person receives assistance from such agencies; or
(v) obtain an alternate form of income verification reasonably requested by Authority, if none of the above forms of verification is available to Developer. (b) Verification Regarding Eligibility of New Tenants . Developer shall retain documentation regarding the eligibility of each new tenant household.

6.3 [Reserved].

6.4 Maintenance of the Portion B Area. Developer agrees for itself and its successors in interest to the Portion B Area, to maintain the improvements on the Portion B Area in conformity with the City Code and the conditions set forth in the City Regulatory Agreement, and shall keep the Portion B Area free from any accumulation of debris or waste materials. During such period, Developer shall also maintain the landscaping planted on the Portion B Area in a healthy condition.

6.5 Nondiscrimination Covenants. Developer covenants by and for itself and any successors in interest that there shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the 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. 863

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Developer shall refrain from restricting the rental, s ale or lease of the Portion B Area on the basis of race, color, religion, sex, marital status, ancestry or national origin of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses:

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.”
In leases: “The lessee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through him or her, and this lease is made and accepted upon and subject to the following conditions:
“That there shall be no discrimination against or segregation of any person or group of persons, on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, subl essees, subtenants, or vendees in the premises herein leased.”
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 enjoyme nt of the premises which are the subject of this Agreement, nor shall the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.”

6.6 Effect of Violation of the Terms and Provisions of this Agreement After Completion of Const ruction. City is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided, without regard to whether City has been, remains or is an owner of any land or interest therein in the Portion B Area or in the Project Area of the Redevelopment Plan. City shall have the right, if the Agreement or any covenants in any agreement pursuant to this Agreement, including without limitation the City Regulatory Agreement and the City Lease, are breached, to exercise all rights and remedies, and to 864

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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 such covenants may be entitled.

7. DEVELOPER’S GENERAL REPRESENTATIONS AND WARRANTIES.

As a material inducement to City to enter into this Agreement, and in addition to the representations and warranties in Section 1.5.2, Developer represents and warrants to City that:

7.1 Formation, Qualification and Compliance . Developer (a) is a California limited partnership validly existing and in good standing under the laws of the State of California; (b) has all requisite and the authority to conduct its business and own, purchase, improve and sell its properties.

Developer is in compliance in all material respects with all laws applicable to its business and has obtained all approvals, licenses, exemptions and other auth orizations from, and has accomplished all filings, registrations and qualifications with any governmental agency that are necessary for the transaction of its business; (c) Developer has and will in the future duly authorize, execute and deliver this Agreement and any and all other agreements and documents required to be executed and delivered by Developer in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement; (d) Developer does not have any material contingen t obligations or any material contractual agreements which could materially adversely affect the ability of Developer to carry out its obligations hereunder; (e) There are no material pending or, so far as is known to Developer, threatened, legal proceedin gs to which Developer is or may be made a party or to which any of its property is or may become subject, which have not been fully disclosed by Developer to City in this Agreement which could materially adversely affect the ability of Developer to carry out its obligations hereunder; and (f) There is no action or proceeding pending or, to Developer’s best knowledge, threatened, looking toward the dissolution or liquidation of Developer and there is no action or proceeding pending or, to Developer’s best kn owledge, threatened by or against Developer which could affect the validity and enforceability of the terms of this Agreement, or materially and adversely affect the ability of Developer to carry out its obligations hereunder.

Each of the foregoing items ( a) to (f), inclusive, shall be deemed to be an ongoing representation and warranty. Developer shall advise City in writing if there is any change pertaining to any matters set forth or referenced in the foregoing items (a) to (f), inclusive.

7.2 Execution and Performance of Project Documents . Developer has all requi site authority to execute and perform its obligations under the Project Documents. The execution and delivery by Developer of, and the performance by Developer of its obligations under, each Project Document has been authorized by all necessary action and do not and wi ll not violate any provision of, or require any consent or approval not heretofore obtained under, any articles of incorporation, by- laws or other governing document applicable to Developer.

7.3 Covenant Not to Transfer Except in Conformity . Excepting for the rental of individual dwelling units to occupants in the regular course of business (which rental activity shall not be limited by this Section 8.3), or the sale of a partnership interest to generate proceeds in consideration of the Tax Credits, Developer shall not sell, lease, or otherwise transfer or convey all or any part of the Portion B Area, or any interest therein, unless Developer has first obtained the prior written consent of the City Manager, which consent may be granted or refused in the City Manager’s sole and absolute discretion; City shall upon receipt of written request therefor consent to a sale by the relevant Approved Assignee of its interest in the Development to CHW or an affiliated nonprofit public benefit corporation confirmed by the City Manager after the expiration of the tax credit compliance period . In addition, 865

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Developer’s limited partner and any successor thereto, may, without the prior consent of City and except as set forth in the senior permitted liens, sell, transfer, assign, pledge, hypothecate, and encumber some or all of its partnership interests in Developer and the same shall not be a violation of this Agreement. Moreover, Developer’s or an Approved Assignee’s Limited Partner and any successor thereto, shall have the right, without the prior consent of City and except as set for in the senior permitted liens, to remove any or all of Developer’s general partners for cause as permitted under Developer’s or Approved Assignee’s limited partnership agreement and replace any or all removed general partners with a person or entity determined in the Limited Partner’s sole discretion. Any sale, lease, transfer or conveyance without such consent shall, at City’s option, be void. A change in ownership of Developer or an Approved Assignee resulting in the individuals executing this Agreement on behalf of Developer retaining less than fifty -one percent (51%) ownership of all outstanding shares of Developer shall be deemed to violate this Section 7.3. In connection with the foregoing consent requirement, Developer acknowledges that City relied upon Developer’s particular expertise in entering into this Agreement and continues to rely on such expertise to ensure the satisfactory completion of all of the Improvements, and the marketing and rental of the Required Affordable Units to Extremely Low Income Households and Low Income Households to afford the community a long-term, quality affordable housing resource.

8. DEFAULTS, REMEDIES, AND TERMINATION.

8.1 Default Remedies. Subject to the extensions of time, if any, pursuant to Section 8.10 of this Agreement, failure by any party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and failure to cure as described hereafter, constitutes a “Default” or “Event of Default” under this Agreement. A party claiming a Default shall give written notice of Default to the other parties specifying the Default. Except as otherwise expressly provided in this Agreement, and without limiting or affecting rights of parties hereto to terminate this Agreement, the claimant shall not institute any proceedings against any other party, and the other parties shall not be in Default if such party within thirty (30) days from receipt of such notice immediately, with due diligence, commences to cure, correct or remedy the specified Default and shall complete such cure, correction or remedy with diligence. If a cure is commenced but cannot reasonably be completed within thirty (30) days, the party shall have an additional period of time as reasonably necessary, not to exceed ninety (90) days, to complete the cure. City shall give the Limited Partner (so long as City has received notice of such Limited Partner) a copy of any notice delivered to Developer, and the Limited Partner shall have the right but n ot the obligation to cure the Default within the time periods specific herein.

8.2 Institution of Legal Actions. In addition to any other rights or remedies and subject to the restrictions otherwise set forth in this Agreement, any party may institute an action at law or equity to seek specific performance of the terms of this Agreement, or to cure, correct or remedy any Default, to recover damages for any Default, or to obtain any other remedy consistent with the purpose of this Agreement; provided, that City shall have no right, in any event, to impose a lien for monetary damages against the Portion B Area or on any improvements erected from time-to-time on the Portion B Area. Such legal actions must be instituted in the Superior Court of the County of Placer, State of California.

8.3 Termination by Developer. In the event that as of the time described below (and if no time is described below, the time established therefor in the Schedule of Performance):
(a) by the time set forth therefor in the Schedule of Performance for the Leasehold Transfer, Developer is not in defau lt under this Agreement and City does not execute the 866

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City Lease and effect the Leasehold Transfer to Developer in the manner and condition and by the date provided in this Agreement; or
(b) on or before March 2, 2023 , the Developer informs City that the condition of the Portion B Area is not suitable for the proposed Development; or (c) in the event of any Default of City prior to the Leasehold Transfer which is not cured within the time set forth in Section 8.1 hereof; or (d) the failure to occur of one or more of the Developer Conditions Precedent; and
any such failure is not cured within the applicable time period after written demand by Developer, then this Agreement may, at the option of Developer, be terminated by Notice thereof to City; provided that Developer shall have delivered to City the documents required to be delivered to City pursuant to Section 6.15 of this Agreement. From the date of the Notice of termination of this Agreement by Developer to City and thereafter, this Agreement shall be deemed terminated and there shall be no further rights or obligations among the parties.

8.4 Termination by City. If prior to the time established in the Schedule of Performance for the satisfaction of the City’s Conditions Precedent and subject to the mortgagee protection provisions to the extent expressly set forth herein:
(a) Developer (or any successor in interest) assigns this Agreement or any rights therein or in the Portion B Area in violation of this Agreement; or (b) One of more of the City Conditions Precedent is not satisfied; or (c) Developer fails to execute (as lessee/covena ntee) one or more of the City Regulatory Agreement, the City Lease or the Memorandum of Lease; or (d) On or before December 1, 2025, City has not received from Developer a writing confirming that the condition of the Portion B Area is suitable for the proposed Development; or
(e) Developer is otherwise in default of this Agreement and fails to cure such default within the time set forth in Section 8.1 hereof; then this Agreement and any rights of Developer or any assignee or transferee with respect to or arising out of the Agreement or the Portion B Area (including without limitation all attachments to this Agreement), shall, at the option of City, be terminated by City by Notice thereof to Developer. From the date of the Notice of termination of this Agreement by City to Developer and thereafter this Agreement (including without limitations all attachments hereto) shall be deemed terminated and there shall be no further rights or obligations among the parties, except that City may pursue any remedies it has hereunder. Prior to completion of any such termination, City shall give the Limited Partner notice of any of the foregoing occurrences giving rise to the City’s right to terminate.

8.5 Acceptance of Service of Process . In the event that any legal action is commenced against City, service of process on City shall be made by personal service upon the City Manager or in such other manner as may be provided by law. In the event that any legal action is commenced against City, service of process on City shall be made by personal service upon the City Manager or in such 867

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other manner as may be provided by law. In the event that any legal action is commenced against Developer, service of process on Developer shall be made in such manner as may be provided by law and shall be effective whether served inside or outside of California.

8.6 Rights and Remedies Are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the parties are cumulative, and the exercise by a party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by another party.

8.7 Inaction Not a Waiver of Default. Any failures or delays by either party in asserting any of its rights and remedies as to any Default shall not operate as a waiver of any Default or of any such rights or remedies or deprive either such party of its right to institute and maintain any actions or proceedings which it may deem necessary to protect, assert or enforce any such rights or remedies.

8.8 Applicable Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement.

8.9 Covenant Provisions; Certain Amendments. In the event, as a result of the provision of other financing in connection with the Development, the parties will review and, if appropriate amend covenant and reporting provisions hereof to encompass such other Units as may be regulated by virtue of such other funding. In the event Developer is required by virtue of such other financing to restrict the affordability of Units in a manner more restrictive than as set forth under the form of City Regulatory Agreement then, from time to time upon receipt of request therefor from the City Manager, Developer agrees to consent to modifications to incorporate such greater restrictions into the City Regulatory Agreement; such request(s) by the City Manager can be made at any time(s) during the Required Covenant Pe riod without regard to whether the City Regulatory Agreement have been recorded.

8.10 Enforced Delay; Extension of Times of Performance . In addition to specific provisions of this Agreement, performance by any party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to: war; insurrection; riots; floods; earthquakes; pandemics; fires; casualties; acts of God; acts of the public enemy; acts or omissions of another party, or acts or failures to act of City or any other public or governmental agency or entity (excepting that acts or failures to act of City shall not excuse performance by City). Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of City and Developer. This Section 8.10 shall not be deemed applicable to the City Lease unless expressly incorporated by reference therein. Notwithstanding the foregoing, the following shall not constitute a basis for enforced delay: the failure of Developer to obtain fin ancing commitments sufficient for the development of the Portion B Area in conformity with this Agreement; the failure to obtain approval of a tentative map or parcel map reasonably acceptable to Developer.

In addition to the foregoing (and without regard to the preceding portion of this Section 8.10), the City Manager shall have the authority, at his or her discretion, to approve extensions on behalf of City to approve extensions of time not to exceed a cumulative total of three hundred sixty -five (365) days.
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8.11 Transfers of Interest in Agreement or of the Portion B Area. Except as otherwise set forth in Section 7.3 hereof, Section 8.11, and all subsections of this Section 8.11, shall apply to transfers prior to the Leasehold Transfer. Any transfers occurring or proposed after the Leasehold Transfer are subject to the provisions therefor of the City Regulatory Agreement. In the event of conflict between the provisions of this Section 8.11 and the City Lease (concerning transfers of interest), the City Lease shall control.

8.11.1 Prohibition. The qualifications and identity of Developer are of particular concern to City. It is because of those qualifications and identity that City has entered into this Agreement with Developer. For the period commencing upon the date of this Agreement and until the end of the Required Covenant Period, except as otherwise set forth in Section 7.3 hereof, no voluntary or involuntary successor in interest of Developer shall acquire any rights or powers under this Agreement, nor shall Developer make any total or partial sale, transfer, conveyance, assignment, subdivision, refinancing or lease of the whole or any part of the Portion B Area or the Development thereon (excepting the rental Lease of Units to Occupants) without prior written approval of City, except as expressly set forth herein.

8.11.2 Permitted Transfers. In the event of a proposed assignment by Developer under subparagraphs 8.11.2 through 8.11.3, inclusive, Developer agrees that at least thirty (30) days prior to such assignment it shall give written notice to City including a request for approval of such assignment and satisfactory evidence that the assignee has assumed jointly with Developer the Obligations of this Agreement. In addition, no consent of City shall be required in connection with the transfer of Developer’s leasehold interest in the Portion B Area that occurs by foreclosure or deed in lieu of foreclosure of any Permitted Senior Lien to respective holder thereof or to their nominees or assignees exclusive of Developer and CHW. The provisions of this Section 8.11 shall be limited by those transfers permitted in Section 7.3.
(a) Any transfers to an entity or entities in which Developer retains a minimum of fifty-one percent (51%) of the ownership or beneficial interest and retains management and control of the transferee entity or entities or relating to the syndication of Tax Credits or after the Tax Credit period, the removal of the Tax Credit investor. (b) The conveyance or dedication of any portion of the Portion B Area to City or other appropriate governmental agency, or the granting of easements or permits to facilitate construction of the Development.

In the event of a proposed assignment by Developer under subparagraphs (a) and (b) of this Section 8.11.2, inclusive, Developer agrees that at least thirty (30) days prior to such assignment it shall give written notice to City including a request for approval of such assignment and satisfactory evidence that the assignee has assumed jointly with Developer the Obligations of this Agreement. In addition, no consent of City shall be required in connection with the transfer of Developer’s leasehold interest in the Portion B Area that occurs by foreclosure or deed in lieu of foreclosure of any Permitted Senior Lien to respective holder thereof or to their nominees or assignees exclusive of Developer and CHW.

8.11.3 City Consideration of Requested Transfer. City agrees that it will consider in good faith a request made pursuant to this Section 8.11 after the achievement of occupancy of ninety percent (90%) or more of the Units in conformity with this Agreement following the issuance by City of a Certificate of Completion for the last building to be constructed as part of the Improvements, provided Developer delivers written notice to City requesting such approval, the City Regulatory 869

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Agreement remain in full force and effect. Such notice sh all be accompanied by sufficient evidence regarding the proposed assignee’s or purchaser’s development and/or operational qualifications and experience, its financial commitments and resources, and the financial terms of such assignment (including the cons ideration proposed to flow to Developer or Related Entity and/or any of the Principals) in sufficient detail to enable City to evaluate the proposed assignee or purchaser pursuant to the criteria set forth in this Section 8.11, and as reasonably determined by City. Notwithstanding the foregoing, neither the transfer of limited partnership interests to tax credit investors (or subsequent transfers of limited partnership interests) nor the removal and replacement of Developer’s general partner in accordance with Section 8.3 shall entitle City to receive compensation (in connection with such transfer). City shall evaluate each proposed transferee or assignee on the basis of its development and/or qualifications and experience in the operation of facilities si milar to the Development, and its financial commitments and resources, and may reasonably disapprove any proposed transferee or assignee, during the period for which this Section 8.11 applies, which City reasonably determines does not possess sufficient qualifications. An assignment and assumption agreement in form satisfactory to City’s legal counsel shall also be required for all proposed assignments. Developer agrees and acknowledges that in connection with any such assignment approved by City pursuant to this Agreement, Developer shall remain liable for performance pursuant to this Agreement for a period of five (5) Years following such assignment; provided that the five -Year limitation shall not apply (and the ongoing liability of Developer shall not be thereby limited) in connection with the transfer of limited partnership interests to tax credit investors. Within thirty (30) days after the receipt of Developer’s written notice requesting approval of an assignment or transfer pursuant to this Section 8.11, including assignments that do not require City/City Manager approval, City shall either approve or disapprove such proposed assignment or shall respond in writing by stating what further information, if any, City reasonably requires in order to determine the request complete and determine whether or not to grant the requested approval. Upon receipt of such a response, Developer shall promptly furnish to City such further information as may be reasonably requested . In addition, City will not unreasonably withhold its approval of a transfer made at the conclusion of the tax credit period to Developer and affiliates upon the removal of the tax credit investor, so long as there are no defaults under this Agreement an d the transferee agrees to be bound by all executory provisions of this Agreement.

Notwithstanding the foregoing portion of this Section 8.11.3, Section 7.3 shall be enforceable in accordance with its terms.

8.11.4 Successors and Assigns. All of the terms, coven ants and conditions of this Agreement shall be binding upon Developer and its permitted successors arid assigns. Whenever the term “Developer” is used in this Agreement, such term shall include any other permitted successors and assigns as herein provided.

8.12 Non-Liability of Officials and Employees of City. No member, official, officer or employee of City shall be personally liable to Developer, or any successor in interest, in the event of any Default or breach by City or for any amount which may become due to Developer or its successors, or on any obligations under the terms of this Agreement.

8.13 Relationship Between City and Developer . It is hereby acknowledged that the relationship between City and Developer is not that of a partnership or joint venture and that City and Developer shall not be deemed or construed for any purpose to be the agent of the other. Accordingly, except as expressly provided in this Agreement, including the Attachments hereto, City shall have no rights, powers, duties or obligations with respect to the development, operation, maintenance or management of the Development so long as such rights are held by Developer under this Agreement. 870

51 Rocklin CHW Portion B, v3

8.14 City Approvals and Actions. Whenever a reference is made herein to an action or approval to be undertaken by City, the City Manager is authorized to act on behalf of City unless specifically provided otherwise or the law otherwise requires. When a reference is made herein to an action or approval to be undertaken by City , the City Manager is authorized to act on behalf of City unless specifically provided otherwise or the law otherwise requires.

8.15 Real Estate Brokers . City and Developer each represent and warrant to each other that no broker or finder is entitled to any commission or finder’s fee in connection with this transaction, and each agrees to defend and hold harmless the other from any claim to any such commission or fee resulting from any action on its part.

8.16 Attorneys’ Fees. In any action among the parties to interpret, enforce, reform, modify, rescind, or otherwise in connection with any of the terms or provisions of this Agreement, the prevailing party in the action shall be entitled, in addition to any other relief to which it might be entitled, reasonable costs and expenses including, without limitation, litigation costs and reasonable attorneys’ fees.

8.17 Non-recourse Liability of Developer . Notwithstanding anything to the contrary in this Agreement or any other Project Document, neither Developer nor any of its partners shall be personally liable for any default, loss, claim, damage, expense or liability to any person and the sole remedy against Developer hereunder shall be limited to its interest in the Development, excepting that Developer will be responsible for those liabilities of Developer referenced in Section 5.7.

9. MISCELLANEOUS

9.1 Obligations Unconditional and Independent. Notwithstanding the existence at any time of any obligation or liability of City to Developer, or any other claim by Developer against City, in connection with the Portion B Area or otherwise, Developer hereby waives any right it might otherwise have (a) to offset any such obligation, liability or claim against Developer’s obligations under this Agreement (including without limitation the attachments hereto), or (b) to claim that the existence of any such outstanding obligation, liability or claim excuses the nonperformance by Developer of any of its obligations under the Project Documents.

9.2 Notices. All notices, statements, demands, requests, consents, approvals, authorizations, offers, agreements, appointments or designations hereunder by any party to the others (each, a “Notice”) shall be in writing and shall be given either by (i) personal service, (ii) delivery by reputable document delivery service such as Federal Express that provides a receipt showing date and time of delivery, or (iii) mailing in the United States mail, certified or registered m ail, return receipt requested, postage prepaid, and addressed as follows:

If to Developer: Pacific Street Housing Associates Nine, L.P. c/o Community HousingWorks
3111 Camino del Rio North, Suite 800
San Diego, CA 92108
Attn: Kevin Leichner
Telephone: (619) 282-6647

871

52 Rocklin CHW Portion B, v3
with a copy to: (which copy shall not constitute notice to Developer) [to come: contact information for tax credit investor(s)] and a copy to: (which copy shall not constitute notice to Developer) Gubb & Barshay LLP
235 Montgomery Street, Suite 1110
San Francisco, CA 94104
Attention: Nicole Kline

and a copy to: NEF Assignment Corporation
540 W. Madison Street, Suite 1990
Chicago, Il 60661
Attention: General Counsel

and a copy to: Bocarsly Emden Cowan Esmail & Arndt
633 West 5th Street, Suite 5880
Los Angeles, CA 90071
Attention: Rachel Rosner

and a copy to: Cedar Rapids Bank and Trust Company
500 First Avenue NE, Suite 100
Cedar Rapids, Iowa 52401
Attention: Brad Curtin

and a copy to: Winthrop & Weinstine, P.A.
225 South Sixth Street, Suite 3500
Minneapolis, Minnesota 55402
Attention: Robert P. Singleton

If to City: City of Rocklin
3970 Rocklin Road
Rocklin, CA 95677
Attn: City Manager
and a copy to: (which copy shall not constitute notice to City) Office of City Attorney
3970 Rocklin Road
Rocklin, CA 95677
Attention: City Attorney
Addresses for notice may be changed from time to time by written notice to all other parties.

All communications shall be effective when actually received; provided, however, that nonreceipt of any communication as the result of a change of address of which the sending party was not notified or as the result of a refusal to accept delivery shall be deemed receipt of such communication.

9.3 Survival of Representations and Warranties. All representations and warranties in the Project Documents shall survive the Leasehold Transfer and the rental of the Required Affordable Units and have been or will be relied on by City notwithstanding any investigation made by City. 872

53 Rocklin CHW Portion B, v3

9.4 No Third Parties Benefited Except for City; AB 987. This Agreement is made for the purpose of setting forth rights and obligations of Developer and City, and no other person (except for City) shall have any rights hereunder or by reason hereof. Except for City, which shall be deemed to be a third party beneficiary of this Agreement (including without limitation the Attachments hereto), there shall be no third party beneficiaries of this Agreement. Developer acknowledges that, notwithstanding the foregoing portion of this Section 9.4, pursuant to AB 987 and the amendments to Health and Safety Code Section 33334.3 made effective as of January 1, 2008 by that bill, it is possible that violations of the covenants, conditions and restrictions relating to affordable housing contained in the City Regulatory Agreement may now be enforceable not only by City, but also by each of the persons and/or entities listed in Section 33334.3(f)(7) of the Health and Safety Code, specifically (1) residents of affordable units subject to covenants record ed pursuant to Health and Safety Code Section 33334.3(f)(1) (each, a “Covenanted Unit”), (2) the most recent former residents of such a Covenanted Unit, (3) applicants that are Lower Income Households or Extremely Low Income Households that are denied occu pancy of such a Covenanted Unit, and (4) persons that are Lower Income Households or Extremely Low Income Households and who are on a waiting list for occupancy of such a Covenanted Unit. The provisions of AB 987 are to be applicable only to the extent required by law. Nothing in this Section 9.4 or this Agreement (including the Attachments hereto) is intended to provide an enforcement right to any person or entity not specifically made an intended third party beneficiary of this Agreement; any such thir d party shall be limited in their right to enforce affordability restrictions to the extent provided by Health and Safety Code Section 33334.3(f). City make s no representation concerning the applicability, vel non , of Section 33334.3 as described in the foregoing portion of this Section 9.4.

9.5 Binding Effect; Assignment of Obligations . This Agreement shall bind, and shall inure to the benefit of, City, Developer and City and their respective successors and assigns. Developer shall not assign any of its rights or obligations under any Project Document without the prior written consent of the City Manager, which consent may be withheld in the City Manager’s sole and absolute discretion; provided that the City Manager shall reasonably consider an assignment to an entity or entities owned or under majority control by Developer or the Principals where Developer pays City’s and City’s costs to review, estimate, process and docu ment such assignment and no other provisions of this Agreement are amended thereby. Any such assignment without such consent shall, at City’s option, be void. In connection with the foregoing consent requirement, Developer acknowledges that City relied upon Developer’s particular expertise in entering this Agreement and continues to rely on such expertise to ensure the satisfactory completion of the Improvements and the use of the Required Affordable Units in conformity with this Agreement.

9.6 Option.
(a) City Option to Acquire Leasehold . Notwithstanding, and in addition to, the remedies provided to City otherwise provided under this Agreement, Developer hereby grants to City the option (“Option”) to purchase Developer’s leasehold interest in the Portion B Area , the Improvements and any other improvements to the Portion B Area (collectively, the “Leasehold Assets”). The purchase Option will begin as of the last day of the fif ty-fifth (55th) Lease Year and will continue in effect thereafter for the remainder of the Term. City may, but shall not be required to, purchase the Leasehold Assets for an amount equal to the “Final Value”, as defined below. This Option shall be subordi nate to any Approved Construction and/or Permanent Lender and their respective Primary Construction Loan and Primary Permanent Loan, as applicable, and shall terminate and be of no further force and effect upon a foreclosure or deed in lieu thereof. 873

54 Rocklin CHW Portion B, v3
(i) Determination of Initial Value . The value of the Leasehold Assets will be determined initially by an appraiser selected by City based upon the greater of (a) the value of the Leasehold Assets subject to the restrictions and limitations on the rental of all units on the Portion B Area to Extremely Low Income Households and Lower Income Households as provided under the City Regulatory Agreement, or (b) all then outstanding amounts (principal and accrued and unpaid interest) owing under such financing secured by De veloper’s interest in the Project which financing was theretofore approved in writing by City; the amount as so established constitutes the “Initial Value”. The appraiser shall have sixty (60) days to obtain such appraisal and to tender its offer of sale.
(ii) Developer Submittal. Within ten (10) business days after City has transmitted a writing setting forth the Initial Value to Developer, Developer shall deliver in writing to City a writing setting forth: (a) such Developer’s decision to sell the Leasehold Assets to City for an amount equal to the Initial Value; (b) Developer’s opinion of value , if different from that of the Initial Value as described above; or (c) such Developer’s decision to retain an appraiser to provide an opinion of value of the Leasehold Assets. If Developer approves the Initial Value, such amount shall be deemed to constitute the “Final Value.” In the event Developer is obtaining an appraisal, it shall have sixty (60) days to obtain such appraisal and deliver its offer to sell to City based upon such value.

An amount determined under (b) or (c) of this subsection (ii) shall constitute the “Alternative Value.” In the event Developer fails to deliver its written response to City by the time set forth in this subsection (ii), then the Initial Value shall be deemed to constitute the “Final Value.” Notwithstanding the foregoing portion of this Section 9.6, in no event shall the Final Value be deemed to be less than the amount of loans and advances to finance or refinance the Project which loans and advances have been approved by City.
(iii) City Response. Within ten (10) business days after City receives a wr iting from Developer under subsection (ii) of this Section 9.6(a), City shall notify Developer in writing that: (a) City has elected to open escrow for the purchase of the Leasehold Assets based upon the Initial Value (which shall be applicable in the eve nt Developer agrees that the Initial Value shall constitute the Final Value, or if Developer fails to deliver its written response under subsection (ii) by the time prescribed therefor in such subsection (ii) in which event the Initial Value shall be deemed to constitute the Final Value); (b) City has elected to open escrow for the purchase of the Leasehold Assets treating the Alternative Value as the Final Value; (c) City has elected to not proceed to exercise its rights to acquire the Leasehold Assets by means of the Option; or (d) City has elected to reject the Alternative Value and instead elects (1) to have the appraisers who, respectively, determined the Initial Value and the Alternative Value, jointly select a third, independent MAI appraiser (the “Independent MAI Appraiser”) to determine the value of the Leasehold Assets and, if such appraiser fail to reach agreement on the Independent MAI Appraiser, then (2) to have the prepares of the Initial Value and the Alternative Value each designate three (3) MAI appraisers, from which the City Clerk will randomly select one of the MAI appraisers. (iv) Appraiser Determination. In the event the Independent MAI Appraiser is designated, such appraiser shall determine a value for the Leasehold Assets subject to the Appraisal Parameters (the “Independent MAI Value”). Developer and City agree that, in such case, an amount equal to the average of: (a) the Independent MAI Value and (b) whichever of the amount determined under 9(a)(i) or (ii) above is closer to the Independent MAI Value, shall be deemed to constitute the “Final Value” for purposes of this Agreement. 874

55 Rocklin CHW Portion B, v3
In connection with any purchase of the Leasehold Assets under this Section 9.6(a), City shall receive credit for any outstanding indebtedness to City with respect to the Property.
(v) Implementation of Sale Upon Establishment of Final Value .

Within five (5) working days following the establishment of the Final Value, City shall: (a) deliver its written notice that it elects no t to acquire the Leasehold Assets under Section 9.6; (b) deliver to Developer both: (1) a written notice of its election to exercise the Option at the Final Value (the “Exercise Notice”), and (2) two (2) copies of City’s standard or customary real estate purchase and sale agreement for income-restricted homes (“Purchase Agreement”), both of which are duly-executed by City . Upon Developer receiving the Exercise Notice and the two (2) duly -executed Purchase Agreements, Developer shall execute both copies of the Purchase Agreement and return one fully - executed original to City. Developer’s failure to execute and deliver a copy of the Purchase Agreement in accordance with this Section 10.6(b)(v) shall not affect the validity of the Purchase Agreement ; in addition, specific performance shall be available to City in such event (without limitation as to other rights or remedies) . The Purchase Agreement shall be immediately effective and binding on both Developer and City without further execution by the Parties, on exercise of the Option in accordance with this Section 9.6. City may, instead of purchasing the Leasehold Assets itself, assign its option and right to purchase the Leasehold Assets to City; provided that the Purchase Agreement shall incorporate a price, if greater, equal to the greater of the fair market value of the Leasehold Assets or the amount required to pay off or satisfy all existing debt on the leasehold estate. (vi) Purchase Option Does Not Limit Remedies. THE PURCHASE

OPTION SHALL NOT LIMIT ANY REMEDIES AVAILABLE TO CITY UNDER THE AHA,

INCLUDING WITHOUT LIMITATION REMEDIES UNDER ONE OR MORE OF THE CITY REGULATORY AGREEMENT OR THE CITY LEASE. Without limitation as to other remedies that are available to City, upon compliance with the foregoing requirements of Section 9.6, the obligation of Developer to convey the Leasehold Assets to City shall be enforceable by specific performance.

9.7 Mandatory Assignment. In the event Developer has not obtained a reservation of tax credits equal to or greater than the Tax Credit Amount by the time set forth therefor in the Schedule of Performance, or if by such time the Developer fails to demonstrate to City that it is obtained binding financing commitments which would be sufficient to construct the Project, or if Developer informs City that Developer is unwilling to proceed with the Project on the basis set forth in this Agreement at any time and for any reason, upon giving Developer sixty (60) days to cure or determine that it will proceed to construct the Project on the basis set forth in this Agreement, City reserves the right to assign all rights of Developer herein to a nominee to replace the Developer for all purposes of th is Agreement. Such reservation and designation of a substitute developer would be accomplished by writing by City to Developer.

9.8 Counterparts. Any Project Document may be executed in counterparts, all of which, taken together, shall be deemed to be one and the same document.

9.9 Prior Agreements; Amendments; Consents . This Agreement (together with the other Project Documents) contains the entire agreement between City and Developer with respect to the Portion B Area , and all prior negotiations, understandings and agreements with respect to such matters are superseded by this Agreement and such other Project Documents. To the extent the Original Agreement has not already been supersede or repealed, the Original Agreement is superseded by this Agreement; the Original Agreement shall hereafter have no further force and effect. No modification of any Project Document (including waivers of rights and conditions) shall be effective 875

56 Rocklin CHW Portion B, v3
unless in writing and signed by the party or parties against whom enforcement of such modification is sought, and then only in the specific instance and for the specific purpose given. This Agreement is executed in three (3) duplicate originals, each of which is deemed to be an original. This Agreement includes pages 1 through 58, plus signature pages and Attachments 1 through 18, which constitutes the entire understanding and agreement of the parties.

This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements among the parties or their predecessors in interest with respect to all or any part of the subject matter hereof.

All waivers of the prov isions of this Agreement must be in writing by the appropriate authorities of City and Developer, and all amendments hereto must be in writing by the appropriate authorities of City and Developer. Whenever this Agreement provides for action by City, the C ity Manager may act on behalf of City unless the context or applicable law requires otherwise.

9.10 Governing Law. All of the Project Documents shall be governed by, and construed and enforced in accordance with, the laws of the State of California. Developer irrevocably and unconditionally submits to the jurisdiction of the Superior Court of the State of California for the County of Placer in connection with any legal action or proceeding arising out of or relating to this Agreement or the other Project Documents. Assuming proper service of process, Developer also waives any objection regarding personal or in rem jurisdiction or venue.

9.11 Severability of Provisions. No provision of any Project Document that is held to be unenforceable or invalid shall affect the remaining provisions, and to this end all provisions of the Project Documents are hereby declared to be severable.

9.12 Headings. Article and section headings are included in the Project Documents for convenience of reference only and shall not be used in construing the Project Documents.

9.13 Conflicts. To the great feasible extent, the provisions of this Agreement shall be construed as consistent with the Project Documents. In the event of any conflict between the provisions of this Agreement and those of any other Project Document executed by City, the Project Documents as executed by City shall prevail; provided however that, with respect to any matter addressed in both such documents, the fact that one document provides for greater, lesser or different rights or obligations than the other shall not be deemed a conflict unless the applicable provisions are inconsistent and could not be simultaneously enforced or performed.

9.14 Time of the Essence. Time is of the essence of all of the Project Documents.

9.15 Conflict of Interest. No member, official or employee of City shall have any direct or indirect interest in this Agreement, nor participate in any decision relating to the Agreement which is prohibited by law.

9.16 Cure by Limited Partner. Limited Partner is not obligated to perform as Developer under this Agreement; however, in the event a breach by Developer is cured by Limited Partner, City will accept such cure. Any cure by Limited Partner shall be acco mplished within the time afforded Developer for cure hereunder, excepting that in the event it is necessary to replace the General Partner of Developer in order to effect a cure, Limited Partner shall be afforded an additional reasonable time to replace the General Partner and accomplish the cure. 876

57 Rocklin CHW Portion B, v3
Notwithstanding any provision of this Lease to contrary effect, approval by the Limited Partner and notice to the Limited Partner shall not be required as of such time as Limited Partner does not hold an interest in the Project or Developer’s rights under this Agreement.

9.17 Warranty Against Payment of Consideration . Developer warrants that it has not paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the dates hereinafter respectively set forth.
(signatures on following pages)

877

S-1
Rocklin CHW Portion B, v3
DEVELOPER:

By:
__________________________________________
Kevin Leichner
Senior Vice President Housing and Real Estate
Development
Consent and approval of CHW:

Community HousingWorks, a California public
benefit corporation (“CHW”), hereby evidences its
approval and consent that any rights of CHW under
the Original Agreement are hereby assigned to Pacific
Street Housing Associates Nine, L.P., a California
limited partnership
By: ____________________________________
Kevin Leichner
Its: Senior Vice President Housing and Real
Estate Development

878

S-2
Rocklin CHW Portion B, v3
CITY:

CITY OF ROCKLIN, a municipal corporation
By:

Jill Gayaldo, Mayor
ATTEST:

Avinta Madhukansh-Singh, City Clerk
APPROVED AS TO FORM:

Mark Huebsch, Consulting Attorney

879

Attachment No. 1

Rocklin CHW Portion B, v3
ATTACHMENT NO. 1

PORTION B AREA MAP

880

Attachment No. 2

Rocklin CHW Portion B, v3
ATTACHMENT NO. 2

LEGAL DESCRIPTION OF THE PORTION B AREA

881

Attachment No. 3

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Rocklin CHW Portion B, v3
ATTACHMENT NO. 3

SCHEDULE OF PERFORMANCE
For the purposes of this Schedule of Performance, the “Date of Agreement” is ________ __, 2025. The City Manager may extend by not more than three hundred sixty -five (365) days the time under this Schedule of Performance by which any obligation of Developer shall be performed.

1. TCAC Approval . Developer shall have
obtained allocation by TCAC of a
preliminary reservation for tax credits for
the Development in an amount of not less
than the Tax Credit Amount.

On or before the Tax Credit Deadline.

2. Satisfaction of City Conditions Precedent.

Developer shall satisfy the City Conditions
Precedent.

Not later than the Tax Credit Deadline.

3. Recording of Documents. The City Lease
or a memorandum thereof (as prepared by
City) is recorded; in addition, each and
every document required to be executed
and delivered in connectio n with the
Leasehold Transfer shall have been
delivered and each and every document
required to be recorded shall have been
recorded, including without limitation the
City Regulatory Agreement).

As soon as feasible following the satisfaction of
the City Conditions Precedent.

4. Commencement of Construction .

Developer shall have commenced
construction of the Improvements.

Not later than the first anniversary of the Dat eof
Agreement.

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

On or before the second anniversary of the
commencement of construction.

6. Rental Units Occupied. Developer causes
the Required Affordable Units to be
occupied using rents prescribed by and i n
conformity with the Agreement.

Within three hundred (300) days after the earlier
of (i) issuance of a Certificate of Completion for
the Improvements or (ii) the time established for
completion of construction of the Improvements
herein, which deadline shall be subject to any
applicable extensions under Section 9.10 of the
Agreement.

882

Attachment No. 4

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Rocklin CHW Portion B, v3
ATTACHMENT NO. 4

CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
TO: City of Rocklin
3970 Rocklin Road
Rocklin, California 95677
Attention: City Manager
The undersigned, _______________, being duly authorized to execute this Certificate of Continuing Program Compliance (this “Certificate”) on behalf of Pacific Street Housing Associates Nine, L.P., a California limited partnership (the “Developer”), hereby represents and warrants that:

1. He has read and is thoroughly familiar with the provisions of the Affordable Housing Agreement (the “AHA”) by and between City, the City of Rocklin (“City”) and Developer dated as of ________ __, 202_, including without limitation the City Regulatory Agreement, the City Lease, and other attachments thereto. Capitalized terms used herein shall have the same meaning as that set forth in the AHA; and

2. As of the date of this Certificate, the following n umber of completed residential units at the Portion B Area: (i) are currently occupied by Extremely Low Income Households at Affordable Rent; (ii) are currently occupied by an Extremely Low Income Households at Affordable Rent; (iii) are currently occupied by Lower Income Households at Affordable Rent; (iv) are currently vacant and being held available for occupancy by an Extremely Low Income Household at Affordable Rent; (v) are currently vacant and being held available for occupancy by a Low Income Household since the date of Low Income Household vacated such unit and have been so held continuously since the date a Lower Income Household vacated such unit):

Occupied at an Affordable Rent by:
i. Extremely Low Income Households (30%) ___ # of Units, Nos.:
ii. Very Low Income Households (50%) __ # of Units, Nos.: ____________ ii. Low Income Households (60%) ___ # of Units, Nos.:

Vacant:
a. Held for occupancy by:
i. Extremely Low Income Households (30%) ___ # of Units, Nos:
ii. Very Low Income Households (50%) ___ # of Units, Nos: ________ ii. Lower Income Households (60%) ___ # of Units, Nos.:

b. Last occupied by:
i. Extremely Low Income Households (30%) ___ # of Units, Nos:
ii. Very Low Income Households (50%) ___ # of Units, Nos: ____________ ii. Lower Income Households (60%) ___ # of Units, Nos.:
883

Attachment No. 4

Page 2 of 2 ends

Rocklin CHW Portion B, v3

3. At no time since the date of filing of the last Certification of Continuing Program Compliance have less than one hundred percent (100%) of the Required Affordable Units as completed units in the Project been occupied by, or been last occupied, or have been available for occupancy by Extremely Low Income Households, Very Low Income Households and/or Lower Income Households at an Affordable Rent, and all of the Required Affordable Units have been occupied in conformity with the Tenant Selection and Tenant Services Plan.

4. Developer is not in default under the terms of the Agreement, including without limitation the attachments thereto (such as the City Lease and the City Regulatory Agreement).

PACIFIC STREET HOUSING ASSOCIATES
NINE, L.P., a California limited partnership
By: CHW Pacific Street Nine LLC, its managing
general partner
By: Community HousingWorks, a California
nonprofit public benefit corporation (its sole member
and manager)
By: ________________________________
Kevin Leichner
Senior Vice President Housing and Real Estate
Development

(DEVELOPER)
884

Attachment No. 5

Page 1 of 1 ends

Rocklin City CouncilNovember 18, 2025

Rocklin City Council
November 18, 2025