Sacramento City Council
May 9, 2023

City of Sacramento
City Council - 2PM Report
915 I Street Sacramento, CA 95814
www.cityofsacramento.org
File ID: 2023-00372 5/9/2023 Public Hearing Item 3.

City Council/Housing Authority - Tax Equity and Fiscal Responsibility Act (TEFRA) Hearing, Approval of Tax-Exempt Bonds TEFRA, Approval of Final Bond Documents and Additional $4 Million Commitment of Funds and Approval of the Loan and Final Bonds Documents for On Broadway Apartments (Noticed on April 25, 2023)
File ID: 2023-00372
Location: 1901 Broadway, District 4, Represented by Mayor Steinberg Recommendation: Conduct a public hearing and upon conclusion adopt: 1) a City Council Resolution indicating the City Council has conducted a Tax Equity and Fiscal Responsibility Act (TEFRA) public hearing related to the proposed acquisition, construction and permanent financing of the On Broadway Apartments (Project); 2) a City Council Resolution authorizing the Sacramento Housing and Redevelopment Agency (SHRA) to: a) approve additional funding of $4 million comprised of $3.3 million in Permanent Local Housing Allocation (PLHA), and $700,000 in Mixed Income Housing Funds (MIHF) b) execute a Funding Agreement and all necessary documents associated with this transaction with EAH Housing, Inc. or related entity for the Project, c) amend the SHRA budget, and e) make related findings; and 3) a Housing Authority Resolution a) is to issue up to $80 million in Mortgage Revenue Bonds ; and b) authorizing the Executive Director, or designee, to execute documents deemed necessary by herself or her designee and related to the transaction.

Contact: Christine Weichert, Director, (916) 440-1353, [email protected], Sacramento Housing and Redevelopment Agency, Sacramento Housing and Redevelopment Agency Presenter: Whitney Bonner, Program Manager, (916) 440-1325, [email protected], Sacramento Housing and Redevelopment Agency
Attachments:
1-Description/Analysis and Background
2- City Council Resolution - TEFRA
3- Housing Authority Resolution - Bonds
4- Exhibit A: Public Disclosures Relating to Conduit Revenue Obligations 5- City Council Resolution - Loan Documents
6- Loan Documents
7- Vicinity Map
8- Project Rendering
9- Project Summary

File ID: 2023-00372 5/9/2023 Public Hearing Item 3.
10- Cashflow Proforma
11- Maximum Income and Rent Limits
Additional Description/Analysis
Issue Detail: On June 29, 2020, Sacramento County and SHRA jointly issued a “Request to Partner on No Place Like Home Developments” (RTP). The selection criteria contained in the RTP mirrored the California Department of Housing and Community Development (HCD) competitive selection criteria, including development team experience, site control, integration, financial feasibility, capital and operational leverage, readiness, and supportive services.

On September 1, 2020, SHRA received a new construction development application for the Project in the City of Sacramento in response to the RTP. The Developer also submitted a funding application to SHRA for gap financing loan of $3.3 million to assist in funding the acquisition, construction, and permanent financing of the Project.

On December 8, 2021, the Council adopted Resolution 2020-0029 approving a $3.3 million loan commitment comprised of HOME and Housing Trust Funds (HTF) program funds and authorizing the Sacramento Housing and Redevelopment Agency to enter into the Funding Commitment with On Broadway, or related entity (Developer).

Staff is requesting approval to add an additional $4 million, comprised of $3.3 million of PLHA and $700,000 in MIHF for this project due to a $14 million increase in construction materials. The increased cost is a result of labor supply constraints, supply chain issues, and a dramatic increase in the cost of raw materials, specifically wood and concrete. The developer will cover the increased cost to the project by deferring an additional $7.5 million in their developer fee and allocating an additional $2.5 million in Affordable Housing Sustainable Communities (AHSC) funds.

Project-Based Vouchers and No Place Like Home
On June 23, 2020, the On Broadway Apartments proposal was awarded 37 Project Based Vouchers (PBV) by SHRA to benefit homeless households. The 37 PBV units will be assisted through the No Place Like Home Program (NPLH). The NPLH Program provides funding to households designated as homeless and includes at least one household member living with mental illness.

On October 23, 2020, HCD released the third round Notice of Funding Availability (NOFA) for the NPLH program. NPLH funds permanent supportive housing for persons who are in need of mental health services and are experiencing homelessness, chronic homelessness, or at risk of homelessness. A NPLH Selection Committee (comprised of representatives from the County Director of Homeless Initiatives, Division of Behavioral Health Services, and SHRA Development Finance) recommended On Broadway to partner with Sacramento County as co-applicants for a NPLH funding application to HCD. The project was awarded $2,287,737 in the NPLH non-competitive set-aside and $6,992,580 in the NPLH competitive set-aside.

On February 4, 2022, the Project received $18,446,000 in Affordable Housing Sustainable Communities (AHSC) funds from The State Department of Housing and Community Development

File ID: 2023-00372 5/9/2023 Public Hearing Item 3.
(HCD). AHSC funds support infill developments that reduce greenhouse gas emissions.

Project Description: On Broadway Apartments is a permanent supportive and workforce housing development proposed on a 1.25-acre property at 1901 Broadway in the Greater Broadway District.

The site has a vacant office building, which the Developer will demolish. The proposed Project includes two buildings, 60 on-grade parking spaces, and 140 units comprised of 68 one-bedrooms, 36 two-bedrooms, 36 three-bedrooms and 2 exempt management units. There will be 21 Americans with Disabilities Act (ADA) compliant units and seven units with communication features. The proposed Project amenities include management and services offices and meeting rooms, two community rooms, two laundry facilities, four elevators, four community restrooms, indoor bicycle storage, two play areas with playgrounds for school-aged children, picnic areas, and landscaped courtyards. On the West side of the property, there will be over 3,300 square feet of commercial space open to the public that will enhance the living environment of the residents of the Project, with a use subject to approval by SHRA. A vicinity map and project rendering are included as Attachments 7 and 8.

The NPLH units will be distributed throughout the project and will not be concentrated by location or unit type. The bedroom mix for the NPLH units will be as follows: 25 one-bedroom units, nine two- bedroom units, and three three-bedroom units.

Developer
: EAH Housing, Inc. has developed and acquired over 104 properties with over 8,400 units in California and Hawaii since 1968 and this Project will be the first affordable housing project in the Sacramento region.

Property Management
: The Project will be managed by EAH Housing, Inc. property management department that services over 210 properties with over 11,000 units in California and Hawaii. SHRA staff has reviewed and approved the management plan, including daily operations, leasing procedures, maintenance, and eviction procedures, to ensure the company meets SHRA requirements for property management.

Supportive Services: Sacramento County Department of Health Services will be responsible for the mental health support services and the coordination of other supportive services needed by the 37 NPLH residents for a minimum of 20 years, as required by the State NPLH program.

Resident Services: Resident services will be provided by EAH Housing resident services department, which serves over 70 properties with over 6,400 units in California and Hawaii. Resident services will include a 1.5 FTE service coordinator, after school program, workforce development services, and enrichment activities. SHRA staff has reviewed EAH’s qualifications and the resident services plan and has found that the proposed resident services provider and resident services plan meet SHRA requirements.

Security Plan
: SHRA staff has reviewed and approved the security plan, which includes the installation of video assessment, and surveillance cameras interconnected to the police department on the interior and exterior of the building’s perimeter, key FOB access on the ground floor for tenants, as well as a vehicular gate on X Street. In addition, two management staff will live at the development.

File ID: 2023-00372 5/9/2023 Public Hearing Item 3.

Project Financing: In addition to a HOME, HTF, MIHF, and PLHA loan, the Project will be financed with a four percent Low-Income Housing Tax Credit (LIHTC), tax-exempt bond financing, competitive and non-competitive NPLH loan, Affordable Housing and Sustainable Communities program loan, conventional construction loan, and deferred developer fee. The law firm of Orrick, Herrington and Sutcliffe LLP, will serve as Bond Counsel to the Housing Authority.

In addition, SHRA has committed a total of 37 PBV’s to this project. PBV’s are awarded in accordance with the SHRA’s administration of the Housing Choice Voucher Program as authorized by section 8(o)(13) of the U.S. Housing Act of 1937 (42 U.S.C. 1437f(o)(13)) and is based on the Public Housing Authority’s Annual Plan. The Plan is approved annually by the federal Department of Housing and Urban Development (HUD).

Low-Income Set-Aside Requirements
: As a condition of receiving LIHTC and the benefits of tax- exempt bond financing, federal law requires that units be set aside for targeted income groups.

Income restrictions from LIHTC financing require that 20 percent of the units have affordable rents to households with income up to 50 percent of Area Median Income (AMI). SHRA further requires that at least 15 percent of the units have rents that are affordable to households with income up to 50 percent AMI and at least 5 percent of the units have rents that are affordable to households with income up to 30 percent AMI, based on financial feasibility. In addition, SHRA approved 37 Project Based Vouchers in the proposed Project, which the Housing Authority will administer.

Project affordability restrictions will be specified in regulatory agreements with the Developer. The Project Summary and Pro Forma are included as attachments 9 and 10, and a schedule of Maximum Income and Rent Limits is included as attachment 11. These anticipated sources and their affordability requirements are summarized in the following table:

On Broadway Apartments
Affordability Restrictions (55 years) ¹ Units % of Units Extremely Low Income (30% AMI) 37 27%
Very-Low Income (50% AMI) 52 37%
Low Income (60% AMI) 49 35%
Management Unit (Exempt) 2 1%
Total 140 100%
¹Pursuant to 24CFR 983.301, contract rents approved by HUD may exceed the tax-credit rent limits; and the AMI change is due to income averaging regulation by CDLAC. The tenant rent will not exceed 30% of the household adjusted gross income with PBV.

Policy Considerations: The recommended actions for the On Broadway development are consistent with a) SHRA’s approved Multifamily Lending and Mortgage Revenue Bond Policies, priority 2. New Construction (Resolution No. 2019-0425); b) the 2013-2021 Housing Element, which encourages the provision of a variety of quality housing types to encourage neighborhood stability, including options for extremely low-income households (Resolution No. 2013-415); and c) the Sacramento Promise Zone Plans and Goals, Sustainably Built Community sub-goal to increase housing types and transit growth to promote livability and connectivity within the Promise Zone (Resolution No. 2015-263).

File ID: 2023-00372 5/9/2023 Public Hearing Item 3.

Economic Impacts: The On Broadway Apartments multi-family residential project is expected to create 518.11 total jobs (290.874 direct jobs and 227.24 jobs through indirect and induced activities) and create $44,984,175 in total economic output ($27,698,516 of direct output and another $17,285,659 of output through indirect and induced activities).

The indicated economic impacts are estimates calculated using a calculation tool developed by the Center for Strategic Economic Research (CSER). CSER utilized the IMPLAN input-output model (2009 coefficients) to quantify the economic impacts of a hypothetical $1 million of spending in various construction categories within the City of Sacramento in an average one-year period. Actual impacts could differ significantly from the estimates and neither the City of Sacramento nor CSER shall be held responsible for consequences resulting from such differences.

Environmental Considerations:

California Environmental Quality Act (CEQA): The proposed project is exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15332 (Infill Exemption).

National Environmental Policy Act (NEPA): An Environmental Assessment (EA) has been prepared for the proposed project pursuant to the National Environmental Policy Act (NEPA) at 24 CFR Part 58 and it has been determined that the project will not result in a significant impact on the human environment.

Sustainability: The proposed Project has been reviewed for consistency with the goals, policies and targets of the Sustainability Master Plan and the 2030 General Plan. If approved, these projects will advance the following goal, policy and target of goal number one - Energy Independence, specifically by reducing the use of fossil fuels and providing long-term affordable and reliable energy.

Commission Action: Sacramento Housing and Redevelopment Commission: It is anticipated that, at its May 3, 2023 meeting, the Sacramento Housing and Redevelopment Commission will approve the staff recommendation for this item. Staff will notify the Council in the event the item is not approved.

Rationale for Recommendation: The actions recommended in this report enable SHRA to continue to fulfill its mission of providing a range of affordable housing opportunities in the City and are consistent with the SHRA’s approved Multifamily Lending and Mortgage Revenue Bond Policies and the City of Sacramento’s 2013-2021 Housing Element as part of Sacramento’s 2035 General Plan.

Financial Considerations:

The $7.3 million SHRA loan comprised of $2.4 million in HOME funds, $9 million in HTF, $3.3 million in PLHA, and $700,000 in MIHF will have a term of 57 years and bear a simple interest rate at three percent. SHRA will receive a one-time issuance fee of 0.25 percent of the bond amount, payable at bond closing, and an annual payment for monitoring the regulatory restrictions and administration of the bonds in the amount of 0.125 percent of the bond amount. SHRA will also receive a $100 annual administrative fee for each HOME, HTF, PLHA, and MIHF-assisted unit. The total administrative fee will not exceed $25,000 annually for the affordable units during the 55-year term. The Developer will

File ID: 2023-00372 5/9/2023 Public Hearing Item 3.
be responsible for payment of all costs and fees relating to the bonds. Mortgage revenue bonds do not represent a financial obligation of SHRA, Housing Authority, or the City of Sacramento.

Sacramento County Department of Health Services will provide case management to the NPLH clients for a period of at least twenty years. These services will be funded directly through the County.

Local Business Enterprise (LBE), Minority/Women’s Business Enterprise (M/WBE) and Section 3 requirements:

Local Business Enterprise requirements do not apply to this report. Minority and Women’s Business Enterprise requirements and Section 3 will be applied to all activities to the greatest extent feasible and as required by federal funding.

RESOLUTION NO. 2023 -

Adopted by the Sacramento City Council

on date of

ON BROADWAY APARTMENTS: APPROVAL OF THE ISSUANCE OF

OBLIGATIONS BY THE HOUSING AUTHORITY OF THE CITY OF SACRAMENTO ON BEHALF OF BROADWAY STATION, L.P.

BACKGROUND

A. The Housing Authority of the City of Sacramento, a housing authority organized and existing under the laws of the State of California (the Authority ), proposes a plan of financing providing for the issuance of exempt facility bonds for a qualified residential rental project pursuant to Section 142(a)(7) of the Internal Revenue Code of 1986 (the Code) in one or more series issued from time to time, including bonds issued to refund such exempt faci lity bonds in one or more series from time to time, and at no time to exceed $55 million (the Obligations) and to lend the proceeds thereof to Broadway Station, L.P. or a partnership of which EAH Housing (the Developer) or a related person to the Developer is the general partner , to be used to provide funds to finance or refinance the acquisition, construction and development of a multifamily housing residential facility to be located at 1901 Broadway, in the City of Sacramento, California.

B. Section 147(f) of the Code requires the execution and delivery of the Obligations to be approved by the City Council of the City (the City Council), as the elected representative of the City of Sacramento and the host jurisdiction of the subject multifamily housing residential facility, after a public hearing has been held following reasonable and proper notice.

C. A public hearing was held by the City Council on May 9, 2023 , following duly published notice thereof, and all persons desiring to be heard have been heard.

D. It is in the public interest and for the public benefit that the City Council, as the elected representative of the City of Sacramento and the host jurisdiction of the subject multifamily housing residential facility, approve the execution and delivery by the Authority of the Obligations.

BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE CITY COUNCIL RESOLVES AS FOLLOWS:

Section 1. The City Council of the City of Sacramento hereby finds, determines and declares that issuance by the Authority of the Obligations for the purposes described above is hereby approved.

Section 2. This resolution shall take effect immediately upon its adoption.

RESOLUTION NO. 2023 -

Adopted by the Housing Authority of the City of Sacramento

on date of

A RESOLUTION OF THE HOUSING AUTHORITY OF THE CITY OF SACRAMENTO

AUTHORIZING THE EXECUTION AND DELIVERY OF MULTIFAMILY HOUSING

REVENUE NOTES IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED $80,000,000 FOR THE FINANCING OF A MULTIFAMILY RENTAL HOUSING PROJECT TO BE GENERALLY KNOWN AS ON BROADWAY APARTMENTS;

AUTHORIZING THE EXECUTION AND DELIVERY OF A FUNDING LOAN

AGREEMENT, A BORROWER LOAN AGREEMENT, A REGULATORY

AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS AND OTHER DOCUMENTS RELATING THERETO; AND APPROVING OTHER ACTIONS AND

MATTERS RELATING THERETO

BACKGROUND

A. The Housing Authorit y of the City of Sacramento ( Authority) is authorized by Chapter 1 of Part 2 of Division 24 of the California Health and Safety Code (commencing with Section 34200) (Act ) to issue and sell revenue obligations for the purpose of making loans or otherwise providing funds to finance the acquisition, construction, rehabilitation and development of multifamily residential rental housing projects, including units for households meeting the income limits set forth in the Act.

B. The governing board of the Authority (Board ) hereby finds and declares that it is necessary, essential and a public purpose for the Authority to finance multifamily housing projects pursuant to the Act, in order to increase and maintain the supply of multifamily housing in the City of Sacramento (City ) available to persons and families within the income limitations established by the Act.

C. The proceeds of such obligations issued by a housing authority may be loaned to a nongovernmental owner of multifamily housing, who shall be responsible for the payment of such obligations, to allow such nongovernmental owner to reduce the cost of operating such housing and to assist in providing housing for low and very low income persons.

D. Broadway Station, L.P., a California limited partnership, and entities related thereto (collectively, the Borrower), has requested the Aut hority execute and deliver its Housing Authority of the City of Sacramento Multifamily Housing Revenue Note (On Broadway Apartments) 2023 Issue B-1 (Tax-Exempt) (Tax-Exempt Note) and its Housing Authority of the City of Sacramento Multifamily Housing Revenue Note (On Broadway Apartments) 2023 Issue B-2 (Taxable) (Taxable Note and together with the Tax-Exempt Note, the Notes), in one more series or sub-series, and loan the proceeds thereof to the Borrower to finance the acquisition and construction of a 140-unit multifamily rental housing development, to be located in the City, and to be commonly known as On Broadway Apartments (Project).

E. On November 30, 2022, the Authority received an allocation in the amount of $46,348,048 (Allocation Amount ) from the Cali fornia Debt Limit Allocation Committee in connection with the Project.

F. The City Council of the City has by resolution approved the execution and delivery of the Notes by the Authority, following notice and a public hearing as required by Section 147(f) of the Internal Revenue Code of 1986, as amended.

G. The Authority is willing to execute and deliver the Notes in an aggregate principal amount not to exceed $80 million, provided that the portion of such Notes executed and delivered as federally tax -exempt obligations shall not exceed the Allocation Amount, and to loan the proceeds thereof to the Borrower to assist in providing financing for the Project, which will allow the Borrower to reduce the cost of the Project and to assist in providing housing for persons of low and very low income.

H. The Notes will be privately placed with Wells Fargo Bank, National Association, or a party relat ed thereto (Funding Lender ), as the initial holder of the Notes, in accordance with the Authority’s policies.

I. there have been prepared and made available to the Board the following documents required for the execution and delivery of the Notes, and such documents are now in substantial form and appropriate instruments to be executed and delivered for the purposes intended:
a. Funding Loan Agreement ( Funding Loan Agreement ) to be entered into between the Funding Lender and the Authority;

b. Borrower Loan Agreement to be entered into between the Authority and the Borrower;

c. Regulatory Agreement and Declaration of Restrictive Coven ants (Regulatory Agreement) to be entered into between the Authority and the Borrower, with respect to the Project.

J. The Authority hereby finds and declares that this resolution is being adopted pursuant to the powers granted by the Act.

K. All conditions, items and acts required to exist, to have happened and to have been performed precedent to and in connection with the execution and delivery of the Notes as contemplated by this resolution and the documents referred to herein will exist, have happened and have been performed in due time, form and manner as required by the laws of the State of California, including the Act.

L. Pursuant to Section 5852.1 of the California Government Code, the Authority, as a conduit financing provider, has received certain representati ons and good faith estimates from the Borrower and has disclosed such good faith estimates as set forth on Exhibit A attached hereto.

BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE HOUSING AUTHORITY OF THE CITY OF SACRAMENTO RESOLVES AS FOLLOWS:

Section 1. The Authority hereby finds and declares that the above recitals are true and correct.

Section 2. Pursuant to the Act and the Funding Loan Agreement, the execution and delivery of the Tax -Exempt Note designated as “Housing Authority of the City of Sacramento Multifamily Housing Revenue Note (On Broadway Apartments) 2023 Issue B -1 (Tax -Exempt),” and the Taxable Note designated as “Housing Authority of the City of Sacramento Multifamily Housing Revenue Note (On Broadway Apartments) 2023 Issue B -2 (Taxable),” is hereby authorized, including, if and to the extent necessary, one or more series or sub-series, with appropriate modifications and series and sub -series designations as necessary, in an aggregate principal amount not to exceed $80 million; provided that the aggregate principal amount of any tax -exempt Note issued shall not exceed the Allocation Amount.

Section 3. The Notes shall be executed and delivered in the form set forth in and otherwise in accordance with the Funding Loan Agreement , and shall be executed on behalf of the Authority by the manual signature of the Executive Director of the Authority, or a designee thereof, acting alone (each an “Authorized Officer”), with such changes, deletions and insertions as may be approved by such Authorized Officers and legal counsel to the Authority, such approvals being conclusively evidenced by the execution and delivery thereof. The Notes shall be secured in accordance with the terms of the Funding Loan Agreement presented to this meeting, as hereinafter approved, and the Clerk of the Sacramento Housing and Redevelopm ent Agency or such designee (Clerk ) is hereby authorized and directed, if required, to attest the Notes in said form by manual o r facsimile signature thereof. The Notes shall be s ecured in accordance with the terms of the Funding Loan Agreement presented to this meeting, as hereinafter approved.

Section 4. Payment of the principal and purchase price of, and prepayment premium, if any, and interest on, the Notes shall be made solel y from amounts pledged thereto under the Funding Loan Agreement, and the Notes shall not be deemed to constitute a debt or liability of the Authority, the City of Sacramento, the Sacramento Housing and Redevelopment Agency or any Commissioners of the Board.

Section 5. The Funding Loan Agreement in the form on file with the Clerk, is hereby approved. The Authorized Officers, each acting alone, are hereby authorized for and on behalf of the Authority to execute by manual signature and deliver the Funding Loa n Agreement with such changes, additions or deletions as may be approved by such Authorized Officer and legal counsel to the Authority, such approvals to be conclusively evidenced by the execution and delivery thereof. The date, maturity date or dates (which shall not be more than 45 years from the date of execution and delivery thereof), interest rate or rates (which shall not exceed 12%), interest payment dates, denominations, form, registration privileges, manner of execution, place of payment, terms of prepayment and other terms of the Notes shall be as provided in the Funding Loan Agreement as finally executed.

Section 6. The Borrower Loan Agreement in the form on file with the Clerk, is hereby approved. The Authorized Officers, each acting alone, are hereby authorized for and on behalf of the Authority to execute by manual signature and deliver the Borrower Loan Agreement with such changes, additions and deletions as may be approved by such Authorized Officer and legal counsel to the Authority, such ap provals to be conclusively evidenced by the execution and delivery thereof.

Section 7. The Regulatory Agreement in the form on file with the Clerk, is hereby approved. The Authorized Officers, each acting alone, are hereby authorized for and on behalf of the Authority to execute by manual signature and deliver the Regulatory Agreement with such changes, additions or deletions as may be approved by such Authorized Officer and legal counsel to the Authority, such approvals to be conclusively evidenced by the execution and delivery thereof.

Section 8. The Authority is hereby authorized to execute and deliver the Notes to the Funding Lender pursuant to the terms and conditions of the Funding Loan Agreement.

Section 9. The Notes, when executed, shall be delivered to the Funding Lender upon receipt of the initial installment of the purchase price of the Notes.

Section 10. All actions heretofore taken by the officers and agents of the Authority with respect to the financing of the Project and the execution and delivery of the Notes are hereby approved, confirmed and ratified, and the proper officers of the Authority, including the Authorized Officers, are hereby authorized and directed, for and in the name and on behalf of the Authority, to do any and all t hings and take any and all actions and execute any and all certificates, agreements and other documents, which they, or any of them, may deem necessary or advisable in order to consummate the lawful execution and delivery of the Notes in accordance with th is Resolution, including but not limited to a tax certificate, loan related documents, an assignment of deed of trust, subordination or intercreditor agreements, an endorsement, allonge or assignment of any note and such other documents, certificates, agreements and other documents described in the Funding Loan Agreement, the Borrower Loan Agreement and the Regulatory Agreement and other documents herein approved.

Section 11. All consents, approvals, notices, orders, requests and other actions permitted or required by any of the documents authorized by this Resolution, whether before or after the execution and delivery of the Notes, including without limitation any of the foregoing that may be necessary or desirable in connection with any purchase by Califo rnia Community Reinvestment Corporation, and its successors, of the outstanding Tax - Exempt Note and/or related loan thereof to the Borrower, any default under or amendment of such documents, any transfer or other disposition of the Project, any addition or substitution of security for the Notes, or any prepayment of the Notes, may be given or taken by any Authorized Officer, as appropriate, without further authorization by the Board, and each such officer is hereby authorized and directed to give any such consent, approval, notice, order or request and to take any such action that such officer may deem necessary or desirable to further the purposes of this Resolution and the financing of the Project; provided such action shall not create any obligation or liability of the Authority other than as provided in the Funding Loan Agreement and other documents approved herein. The documents authorized herein may be dated such date, and different issue or series designations given to any Notes, as may be appropriate to indicate when such Notes are actually sold or delivered or the nature of such Notes.

Section 12. This Resolution shall take effect immediately upon its adoption.

Table of Contents:

Exhibit A: Public Disclosure Relating to Conduit Revenue Obligations

EXHIBIT A

PUBLIC DISCLOSURES RELATING TO CONDUIT REVENUE OBLIGATIONS

Pursuant to California Government Code Section 5852.1, the borrower (the “Borrower”) identified below has provided the following required information to the Housing Authority of the City of Sacramento (the “Housing Authority”) prior to the Housing Authority’s regular meeting (the “Meeting”) of its Housing Authority Board (the “Board”) at which Meeting the Board will consider the authorization of conduit revenue obligations (the “Bonds”) as identified below.

1. Name of Borrower: Broadway Station L.P., a California limited partnership

2. Authority Meeting Date: May 10, 2023

3. Name of Bond Issue / Conduit Revenue Obligations: Not to exceed $55,000,000 Housing Authority of the City of Sacramento Multifamily Housing Revenue Bonds (Pass-Through – 1901 Broadway).

4. _ Private Placement Lender or Bond Purchaser, __ Underwriter or __x_ Financial Advisor (mark one) engaged by the Borrower from which the Borrower obtained the following required good faith estimates relating to the Bonds:

(A) The true interest cost of the Bonds, which means the rate necessary to discount the amounts payable on the respective principal and interest payment dates to the purchase price received for the new issue of Bonds (to the nearest ten- thousandth of one percent): 6.007%

(B) The finance charge of the Bonds, which means the sum of all fees and charges paid to third parties: $892,422

(C) The amount of proceeds received by the public body for sale of the Bonds less the finance charge of the bonds described in subparagraph (B) and any reserves or capitalized interest paid or funded with proceeds of the Bonds:
$46,348,048

(D) The total payment amount, which means the sum total of all payments the borrower will make to pay debt service on the Bonds plus the finance charge of the Bonds described in subparagraph (B) not paid with the proceeds of the Bonds (which total payment amount shall be calculated to the final maturity of the Bonds): $60,630,177

This document has been made available to the public at the Meeting of the Housing Authority.

RESOLUTION NO. 2023 -

Adopted by the Sacramento City Council

on date of

On BROADWAY APARTMENTS (PROJECT); AUTHORIZATION TO AMEND THE

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY (SHRA) BUDGETS TO ALLOCATE A FUNDING COMMITMENT OF $3.3 million IN PERMANENT LOCAL HOUSING ALLOCATION (PLHA) AND $700,000 IN MIXED INCOME HOUSING FUNDS (MIHF) TO THE ON BROADWAY APARTMENTS; APPROVALTO

EXECUTE LOAN AGREEMENT AND RELATED DOCUMENTS WITH BROADWAY STATION, L.P., A LIMITED CALIFORNIA PARTNERSHIP OR RELATED ENTITY;

AND ENVIRONMENTAL FINDINGS

BACKGROUND

A. Sacramento City Council adopted Resolution No. 2020 -0390 on December 8, 2020, which approved a conditional loan commitment (Loan Commitment) of $3.3 million consisting of $2.4 million in Home Investment Partnership Program (HOME) and $900,000 in Housing Trust Funds from Sacramento Housing and Redevelopment Agency.

B. On Broadway Housing Project is consistent with a) SHRA’s approved Multifamily Lending and Mortgage Revenue Bond Policies (Resolution No. 2019 -0452), priority 2. New Construction: b) the 2013 -2021 Housing Element, which encourages the provision of a variety of quality housing types to encourage neighborhood stability, including options for extremely low -income households (Resolution No. 2013 -415); and c) the Sacramento Promise Zone Plans and Goals, Sustainably Built Community sub-goal to increase housing types and transit growth to promote livability and connectivity within the Promise Zone (Resolution No. 2015-263).

C. The proposed project is exempt from the provisions of the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15332 (Infill Exemption).

D. An Environmental Assessment (EA) has been prepared for the proposed project pursuant to the National Environmental Policy Act (NEPA) at 24 CFR Part 58 and it has been determined that the project will not result in a significant impact on the human environment

BASED ON THE FACTS SET FORTH IN THE BACKGROUND, THE HOUSING AUTHORITY OF THE CITY OF SACRAMENTO RESOLVES AS FOLLOWS:

Section 1. All evidence presented having been duly considered, the findings, including environmental findings regarding this action, as stated above, are found to be true and accurate and are hereby approved adopted.

Section 2. SHRA is authorized to amend its budget and allocate up to $3 .3 million in PLHA and up to $700,000 in MIHF

Section 3. SHRA is authorized to negotiate, enter into , execute and amend the $4 million loan agreement and related documents and transm it to Broadway Station L.P., a Limited California Partnership, or related entity (Developer), and to enter into other agreements, execute other documents, and perform other actions necessary to fulfill the intent of the Loan Commitment and to ensure proper repayment of the MIHF and PLHA funds, including without limitation, loan restructuring, subordination, and extensions, all as approved by SHRA’s Office of the General C ounsel, consistent with its adopted policy and with this resolution.

Table of Contents:

Exhibit A: HOME, HTF, MIHF, PLHA Loan Documents

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 1

CONSTRUCTION AND PERMANENT LOAN AGREEMENT

ON BROADWAY APARTMENTS

IN CONSIDERATION of their mutual promises, the parties agree as follows:

1. LOAN. Lender is making the Loan pursuant to the terms and conditions of this Loan Agreement. Lender and Borrower have entered this Loan Agreement as of the Effective Date.

2. DEFINITIONS TABLES. The capitalized terms in this Loan Agreement shall have the meanings assigned in the following Definitions Tables and in Section 3 Definitions. Terms being defined are indicated by quotation marks. If an item in the Definitions Table is marked “None”, “Not Applicable”, “N/A” or equivalent or is left blank, that defined term is not applicable to this Loan or the referenced item is not required or is not included in this Loan as the context may indicate.

A. “LOAN INFORMATION” The general loan provisions of the Loan:
“EFFECTIVE DATE” May 1, 2023 The date as of which this Loan Agreement shall be effective. “LENDER” The following public agency that is making the Loan, and whose legal status and address are:

Name Sacramento Housing and Redevelopment Agency
Legal Status A joint powers agency
Principal Address 801 12th Street, Sacramento CA 95814
“BORROWER” The borrower of the Loan funds whose name, legal status and address are:

Name Broadway Station, L.P.

Legal Status limited partnership
Principal Address 22 Pelican Way, San Rafael, Ca 94901
“LOAN” The Loan made by this Loan Agreement.
“LOAN COMMITMENT” Lender’s loan commitment, made by letter dated as of December 8, 2020 “LOAN PROGRAM” Lender’s Loan Program commonly known as
HOME Investment Partnership Program
(HOME), Housing Trust Fund (HTF),
Mixed Income Housing Fund (MIHF),
Permanent Local Housing Allocation
(PLHA)
“LOAN AMOUNT”
Seven Million Three Hundred Thousand Dollars and No Cents ($7,300,000.00) Comprised of:

HOME: $2,400,000.00
HTF: $900,000.00
MIHF: $700 000.00
PLHA $3,300,000.00

“INTEREST RATE” The interest rate is 3% per year, simple interest. “MATURITY DATE” The first day of the 684th calendar month following the Effective Date. “PAYMENT SCHEDULE”

Annual loan payments shall be deferred from the Loan’s Effective Date through the first 180 months.

Beginning May 1, 2028, Annual loan payments will be made on a Residual Receipts basis, as defined below, until the Maturity Date. Annual loan payments shall be applied first to outstanding interest accrued and unpaid and then to principal.

“Residual Receipts” is defined as follows: Once annually, based on the annual audited financial statement from the preceding year, payments will be made upon a “Residual Cash Flow” basis meaning Net Operating Income (NOI) less the items described in the below Subsections (i) through (viii), no such proceeds or amounts to be applied in payments of any amounts specified in any of the Subsections below until all amounts specified in any earlier Subsection have been paid in full

Net Cash Flow Distributions. Distributions of Net Cash Flow (where “Net Cash Flow” is defined as Net Operating Income less payment of debt service, and the funding of reserves, on the Senior Loan and payment of developer fee in the amount anticipated to be paid from capital sources not to exceed amounts allowed by HCD Uniform Multifamily Regulations) will be made as follows, subject to the consent of the senior and subordinate lenders:

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 2

(i) to pay credit adjusters owed to the Investor Limited Partner;

(ii) to repay loans made by the Investor Limited Partner to the Borrower;

(iii) to pay the Investor Limited Partner an asset management fee in the annual amount of $8,500, increasing by 3% per year;

(iv) replenish the Operating Reserve pursuant to the loan documents;

(v) to payment of any developer fee that is not paid from capital sources as anticipated and becomes deferred, and accrued interest thereon, if any, not to exceed amounts allowed by CA HCD Uniform Multifamily Regulations;

(vi) to the General Partner or its affiliates to repay any loans or advances made by the General Partner or its affiliates, in support of the development or operation of the Project;

(vii) to pay the General Partner an asset management fee in the annual amount of $16,500, increasing by 3% per year

(viii) 50% of the remaining annual Net Cash Flow shall be distributed to Borrow and the other 50% shall be allocated on a pro rata basis: 79.48% to State Department of Housing and Community Development towards the respective HCD NPLH Competitive Loan, HCD NPLH Non-Competitive Loan, and HCD AHSC Loan; and 20.84% to Sacramento Housing and Redevelopment Agency Lender towards the HOME, HTF, MIHF, and PLHA Loan.

A. First to HOME loan until fully repaid;
B. Then to HTF loan until fully repaid;
C. Then to MIHF loan until fully repaid;
D. Then to PLHA loan until fully repaid;

To the extent that insufficient Net Cash Flow is available to pay any of the amounts set forth in Sections (i) through (viii) when due, such amount shall accrue and be payable in the future when there is available Net Cash Flow, after prior payment of all higher priority payments from Net Cash Flow, as set forth above.

The Net Operating Income is defined as periodic “Revenue” less “Operating Expenses.” “Revenue” means all revenue from the leasing of the Project, including but not limited to all rents, fees, and charges paid by tenants as well as rental subsidy payments regardless of the source of these subsidies, forfeited tenant deposits, rent increases, proceeds from vending machines and laundry room machines. Revenue shall not include tenants’ security deposits (unless forfeited), interest on those deposits, loan proceeds, capital contributions or similar advances, or amounts released from reserves or interest on reserves.

“Operating Expenses” shall mean actual costs, fees and expenses as evidenced by invoices attributable to the operation, recordkeeping, maintenance, taxes and management of the Project, including property management fees; taxes and assessments; payroll, benefits and payroll taxes of for property employees; insurance; security; painting, cleaning, repairs, and alterations; landscaping; sewer charges; utility charges; advertising, promotion and publicity; cable television, satellite and other similar services; office, janitorial, cleaning and building supplies; recreational amenities and Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 3
supplies; purchase, repair, servicing and installation of appliances; costs and expenses associated with the provision of social and/or community services to the residents of the Project; equipment, fixtures and furnishing; fire alarm and elevator monitoring; fees and expenses of accountants, attorneys, consultants and other professionals: debt service monitoring fee payments to HCD with respect to the NPLH and AHSC Loans and SHRA monitoring fee with respect to the HOME, HTF, MIHF, and PLAH Loans. The definition will include deposits into operating and/or replacement reserves maintained by the Borrower but will not include initial deposits to capitalize the reserve accounts or amounts expended from a reserve account, or capital costs. “BORROWER EQUITY”
One Hundred Dollars and No Cents
$100
Which is the minimum amount of cash or cash equivale nt (excluding land equity or other non -cash investment in the Project) that Borrower is investing in the Project.

Seven Million Nine Hundred Twenty-
Five Thousand Seven Hundred Sixty-
Two Dollars and No Cents
$7,925,762
Which is Borrower’s non -cash contribution to the Project (such as deferred Developer fees).
“SPECIAL TERMS” N/A
“PROJECT”
Which is the Project to be developed on
the Property with the Loan funds,
described as:

On Broadway Apartments is a new construction
development on approximately 1.25 acres located along
the Broadway corridor in Sacramento. The development
consists of 140 units comprised of : 68 one-bedroom with one-bathroom, 36 two-bedroom with one -bathroom, and
36 three-bedroom with two -bathroom units. Inclusive of this unit mix, 2 units will be exempt for management staff.

The common areas and amenities include laundry room,
long term and short -term bike storage, conference room, community room with kitchen, support services office on site and an outdoor courtyard

B. “COLLATERAL” The Collateral securing repayment of the Loan, which Collateral consists of the following:
“PROPERTY” The following described real property, which is security for the Loan and the site of the Project:

Address 1901 Broadway, Sacramento, Ca 95818
Assessor’s Parcel
Number APN: 01002130080000
“Legal Description” The Property is situated in the State of California, County of Sacramento, and is more particularly described in Exhibit 1: Legal Description attached and incorporated by reference.

Borrower’s Title
Interest
Borrower has fee interest in the Property or, if the Additional Escrow Instructions so indicate, Borrower will acquire fee interest in the Property at Close of Escrow. “ADDITIONAL
COLLATERAL”
The Additional Collateral securing repayment of the Loan is any additional security required by Lender under this Loan Agreement, including without limitation the following items, if any “PERSONAL PROPERTY”
Borrower’s interest in the following
personal property, tangible and
intangible, and all other such property
listed as security in this Loan
Agreement:

Materials and supplies for the Project,
Assigned Documents
OTHER ADDITIONAL COLLATERAL Borrower’s interest in the following property: None

C. “ESCROW INFORMATION”:
“Title Company” and
“Escrow Agent” Old Republic Title Company Which is the title company that will issue the Title Policy and that will act as Escrow Agent for the Escrow.
“Escrow” The escrow with Escrow Agent
“Closing Date” May 12, 2023 Which is the date for close of the Escrow, as it may be extended.

D. “LIST OF EXHIBITS” (The following are attached and incorporated in this Loan Agreement):

EXHIBIT DEFINED TERM
Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 4
Exhibit 1: Legal Description “Legal Description”
Exhibit 2: Scope of Development “Scope of Development” Exhibit 3: Note Form “Note Form”
Exhibit 4: Trust Deed “Trust Deed”
Exhibit 5: Home Regulatory Agreement “Regulatory Agreement” Exhibit 6: HTF and MIHF Regulatory Agreement “Regulatory Agreement” Exhibit 7: PLHA Regulatory Agreement “Regulatory Agreement” Exhibit 8: Escrow Instructions “Escrow Instructions”
Exhibit 9a: Funding Requirements HOME
Exhibit 9b: Funding Requirements HTF
Exhibit 9c: Funding Requirements MIHF
Exhibit 9d: Funding Requirements PLHA

“Funding Requirements”

E. “APPROVAL DOCUMENTS” Borrower shall submit the following documents for Lender approval:

Construction Agreements for the Project
Architectural Agreement for the Project
Borrower’s organizational documents, such as partnership agreements or corporate articles and by -laws “Budget” for the Project
Evidence of financing as described in this Loan Agreement Plans and Specifications as defined in this Loan Agreement

F. “ASSIGNED DOCUMENTS” Borrower shall assign the following documents to Lender:

Construction Contract
Architectural Contract

G. “CONSTRUCTION INFORMATION”:
“Completion Date” January 1, 2026 Which is the date on or before which the Completion of the Project must occur.
“General Contractor” Brown Construction Which is the general contractor for construction of the Project.
“Project Architect” LPAS Which is the architect for design of the Project “Retention”
The following percentage of each disbursement made
for construction work, in aggregate not to exceed the
following percentage of the Loan Amount, which shall
be retained by Lender for disbursement with the final
disbursement of the Loan:

Percentage of
Loan: TEN Percent (10%)

H. “SPECIAL PROVISIONS” The following special provisions shall be in addition to the provisions of this Loan Agreement:

Loan funds shall be used solely for Project construction. No Loan funds shall be used for predevelopment costs, except as provided in an approved Lender budget. Unless otherwise noted in the budget, predevelopment costs are not subject to withholding as Retention.

3. DEFINITIONS. Terms not defined in this Loan Agreement shall have the definitions assigned in the Trust Deed. As used in this Loan Agreement, the following terms shall have the following meanings:

3.1. “Budget” is the budget approved by Lender for the development of the Project.

3.2. “California Environmental Quality Act” or “CEQA” is established in the California Public Resources Codes § 21000 et seq. and is applicable to private activities requiring discretionary governmental approvals (Pub. Res. Code §210001.1, 21001, 21080 and 14 California Code of Regulations § 15002(c).

3.3. “Change” means any extra work or installation of materials not included in the Plans and Specifications or any change in or deviation from the Plans and Specifications.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 5

3.4. “Close of Escrow” means the fulfillment of the Escrow terms and conclusion of the Escrow, including, without limitation, the execution of unexecuted documents, the recordation of documents specified for recording, the issuance of title insurance policies, the payment of fees and the delivery of funds and documents as directed in the escrow instructions for the Escrow. The Close of Escrow shall occur on the Closing Date.

3.5. “Completion of the Project” means that, in Lender's sole judgment the Project has been constructed, rehabilitated, completed, equ ipped, and furnished in a good and proper manner in accordance with the Plans and Specifications, the Scope of Development and the Budget as approved by Lender; all notices of completion with respect to the Project have been filed; all costs of constructing the Project have been paid, including, without limitation, interest on the Note which may be due prior to the Completion Date; all necessary certificates of occupancy have been issued; and all of the conditions to final disbursement of the Loan have been satisfied.

3.6. “Environmental Review” means the investigation and analysis of the Project’s impacts on the environment as may be required by CEQA and/or National Environmental Policy Act (NEPA), or of the Project’s impacts on any species of plant or animal l isted as a species of concern, or a threatened or endangered species under California or federal laws or regulations.

3.7. “Escrow” is the escrow with Title Company for the closing of the Loan.

3.8. “Escrow Instructions" means the Escrow Instructions for the Escro w signed by each of the parties to this Loan Agreement.

3.9. “Event of Default” is breach of or default , subject to all applicable notice and cure periods, in a party’s obligations under this Loan Agreement, the Trust Deed, the Note, the Regulatory Agreements and any other instrument which is incorporated in this Loan Agreement or which otherwise secures the repayment of the Loan ,.

3.10. “Financial Statements” means the certified financial statements of Borrower (and any other persons on whose financial capacity Lender has relied in making this Loan) as may be required by Lender from time to time, including operating statements, balance sheets, and any other financial reports and information that Lender may require.

3.11. “Fixtures” means all fixtures located on or with in the Project or now or later installed in or used in connection with any of the Project, including, as applicable and without limitation, all partitions, screens, awnings, motors , engines, boilers, furnaces, pipes, plumbing, elevators, cleaning and sprin kler systems, fire extinguishing apparatus and equipment, water tanks, heating, ventilating, air conditioning and air cooling equipment, built -in refrigerators, and gas and electric machinery, appurtenances, and equipment, whether or not permanently affixe d to the Project.

3.12. “General Contractor” means the general contractor identified above as the general contractor to do the Project, or any other general contractor so designated by Borrower and approved in writing in advance by Lender.

3.13. "General Partner” means 1901 Broadway Sacramento EAH, LLC, a California limited liability company, as the general partner of Borrower.

3.14. “Governmental Authority” means the United States of America, the State of California, the County of Sacramento, the City of Sacramento or an y other political subdivision, agency, department, commission, board, bureau, or instrumentality of any of them.

3.15. “Governmental Requirement” means any law, ordinance, order, rule, regulation, plan, ruling, determination or requirement of a Governmental Authority.

3.16. "Investor Limited Partner” means Wells Fargo Affordable Housing Corp., a North Carolina corporation, and its successors and assigns, as the investor limited partner of Borrower.

3.17. “Loan” is the loan from Lender to Borrower made pursuant to this Loan Agreement.

3.18. “Loan Agreement” means this Construction and Permanent Loan Agreement and all exhibits attached to this Loan Agreement (which are incorporated in this Loan Agreement by this reference)

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 6

3.19. “Loan Documents” means the Note, this Loan Agreemen t, the Security Documents, the Regulatory Agreements, and all other documents (including guaranties, if any) evidencing, securing, or relating to the Loan.

3.20. “Loan Maturity Date” means the date on which the entire unpaid balance of the Loan, including princ ipal and interest, is due and payable.

3.21. “Loan Proceeds” means funds disbursed by Lender on account of the Loan and pursuant to this Loan Agreement.

3.22. “Mitigation Measure(s)” means those feasible measures, actions, or features that are to be incorporated into the Project in order to avoid or substantially reduce the Projects significant impact on the environment.

3.23. “National Environmental Policy Act” or “NEPA” contains the federally required procedures to review and analyze the effect and impact of the Project on the environment as applied to the Project under 24 Code of Federal Regulations Parts 50 and 58 et seq.

3.24. “Note” means that certain promissory note evidencing the Loan and attached hereto as Exhibit 3.

3.25. “Other Lender Draw” means a draw request or other request for disbursement submitted to another lender for the Project.

3.26. “Person” means any natural person, corporation, firm, partnership, association, trust, government, governmental agency, or any other entity, whether acting in an individual, fiduciary, or other capacity.

3.27. “Personalty” means, whether or not listed as Additional Collateral, all of Borrower's interest in all accounts, contract rights, and general intangibles (specifically including any insurance proceeds and condemnation awards) arising out of the ownership, development, or operation of the Property, and all furniture, furnishings, equipment, machinery, construction materials and supplies, leasehold interests in personal property, and all other personal property (other than Fixtures) of Borrower now or later located about the Property, together with all present and future attachments, accessions, replacements, substitutions, and additions, and the cash and noncash proceeds.

3.28. “Plans and Specifications” means the final set of architectural, str uctural, mechanical, electrical, grading, sewer, water, street, and utility plans and specifications for the Project, including all supplements, amendments, and modifications.

3.29. “Potential Default” means an event that would constitute an Event of Default bu t for any requirement of notice to be given or period of grace or time to elapse.

3.30. “Project” means the development of the Property in accordance with the Plans and Specifications including, without limitation, all existing buildings, improvements, and appu rtenances on the Property, all work of demolition and rehabilitation to be conducted on the Property, and all improvements, additions, and replacements constructed or placed at any time on the Property.

3.31. “Security Documents” means the Trust Deed, together with all other documents entered into between Borrower and Lender or by Borrower in favor of, or for the benefit of, Lender that recite that they are to secure the Loan.

3.32. “Title Policy” means the title insurance policies to be issued in connection with th is Loan, as further defined in the Escrow Instructions.

3.33. “Trust Deed” means that certain Deed of Trust and Assignment of Rents between Borrower, as trustor, Lender, as beneficiary, and trustee which secures the Note and is attached hereto as Exhibit 4.

3.34. “Unavoidable Delay” is a delay in the performance by a party of any obligation which delay is unforeseeable and beyond the control of such party and without its fault or negligence. Unavoidable Delay shall not be reasonably foreseeable events consisting solely of acts of God, acts of the public enemy, acts of the Federal Government, acts of the other party, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weath er (as for example, floods, tornadoes, or hurri canes) or delays of subcontractors due to such causes. In the event of the Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 7
occurrence of any such enforced delay, the time or times for performance of such obligations of the parties shall be extended for the period of the enforced delay, as determined by Lender, provided that the party seeking the benefit of the provisions of this Section shall, within thirty (30) days after it has or should have knowledge of any such enforced delay, have first notified the other party, in writing, of the delay and its cause, and requested an extension for the period of the enforced delay.

4. BORROWER'S REPRESENTATIONS AND WARRANTIES. As a material inducement to Lender to enter into this Loan Agreement and to make the Loan to Borrower, Borrower unconditionally, and each sig natory who signs on its behalf, to the extent of their actual knowledge, represents and warrants to Lender, as of the Close of Escrow, as follows:

4.1. LEGAL ORGANIZATION. Borrower is duly formed and validly exists in the form stated in Section 2 hereof, is qualified to do business in California, and has full power to consummate the transactions contemplated.

4.2. BORROWER'S POWERS. Borrower has full authority to execute this Loan Agreement, the Note, the Trust Deed, and all of the other Loan Documents, to undertake and consummate the contemplated transactions, and to pay, perform, and observe all of the conditions, covenants, agreements, and obligations.

4.3. BINDING OBLIGATION. This Loan Agreement, the Note, the Trust Deed, and each of the other Loan Documents constitute a legal and binding obligation of, and are valid and enforceable against, each party other than Lender, in accordance with the terms of each.

4.4. LITIGATION. There are no actions, suits, or proceedings pending or, to the best knowledge of Borrower, threatened against or affecting Borrower, the Property, or any part of it, or involving the validity or enforceability of the Trust Deed, the priority of the lien, or the validity or enforceability of any of the other Loan Documents, at law or in equity, o r before or by any Governmental Authority. Borrower is not in default with respect to any order, writ, injunction, decree, or demand of any court or other Governmental Authority.

4.5. NO OTHER BREACH. The consummation of the transactions covered by this Loan Agreement and the payment and performance of all of the obligations in the Loan Documents will not result in any breach of, or constitute a default under, any mortgage, deed of trust, lease, contract, loan or credit agreement, corporate charter, bylaws, p artnership agreement, trust agreement, or other instrument to which Borrower or any of its general partners is a party or by which it or they or the Property may be bound or affected.

4.6. NO DEFAULT. There is no Event of Default or Potential Default on the part of Borrower.

4.7. TITLE TO PROPERTY. Borrower is the sole legal and beneficial owner of the Property, which is free of all claims, liens, and encumbrances other than those shown in the Title Policy.

4.8. NO UNAPPROVED LOANS. Borrower has not received finan cing for either the acquisition of the Property, the construction of the Project or the permanent financing of the Project except as has been specifically disclosed to and approved by Lender in writing.

4.9. TITLE OF PERSONALTY. All Personalty is vested sole ly in Borrower, free of all claims, liens, and encumbrances other than liens disclosed to Lender in writing, and the security interest of Lender in the Personalty is a first lien, unless Lender has given written approval of Senior Liens in which case, the security of interest of Lender in the Personalty is junior only to liens held by those approved senior lenders.

4.10. USE OF PROCEEDS. All Loan Proceeds will be disbursed as provided in this Loan Agreement and used only for payment of the c osts of construction of the Project in accordance with the Plans and Specifications and for other purposes specified in the Loan.

4.11. TAXES PAID. Borrower has filed all required Federal, State, County, and City tax returns and has paid all taxes due and owing. Borrower knows of no basis for additional assessments with respect to any taxes, other than the lien of taxes not yet due.

4.12. PLANS AND SPECIFICATIONS. The Plans and Specifications are satisfactory to Borrower and the General Contractor and have been approved by Lender and all other construction lenders. There are no structural defects in the Project as shown in the Plans and Specifications that are known to or reasonably should have been known to Borrower or its agents Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 8
and employees, and to the best of Borrower's knowledge, no violation of any Governmental Requirement, including but not limited to an environmental requirement, exists.

4.13. ACCURACY. All applications, Financial Statements, reports, documents, instruments, information, and forms of evidence d elivered to Lender concerning the Loan or required by this Loan Agreement or any of the other Loan Documents are accurate, correct, and sufficiently complete to give Lender true and accurate knowledge of their subject matter, and do not contain any untrue statement of a material fact or omit any material fact necessary to make them not misleading.

4.14. BORROWER EQUITY. As of the Close of Escrow, Borrower will have, at minimum, the Borrower Equity, and the Borrower Equity together with the Loan Proceeds and the proceeds of all other financing obtained by Borrower and approved by Lender for the Project is sufficient to complete the Project in accordance with the Plans and Specifications.

5. BORROWER’S COVENANTS AND CONDITIONS. From the Effective Date until payment and performance in full of all obligations of Borrower under this Loan Agreement, the Note, the Security Documents, and the other Loan Documents or the earlier release of the liens of the Loan Documents (and all related obligations) in accordance with the terms of this Loan Agreement, the Note, the Security Documents, and the other Loan Documents, Borrower hereby covenants and agrees with Lender that:

5.1. USE OF PROCEEDS. All Loan Proceeds will be disbursed as provided in this Loan Agreement and used only for payment of the costs of construction of the Project in accordance with the Plans and Specifications and for other purposes specified in the Loan.

5.2. PROPERTY MANAGEMENT. Subject to Lender’s written approval, Borrower shall obtain and maintain for the life of the Loan a top quality property management agreement with a duly accredited real estate property management company for the management of the Property, and shall assure compliance of the property manager with the property management agreement. Lender shall not disburse any funds under this Loan Agreement unless and until it has reviewed and approved the agreement as adequate and the property management company as top quality and duly accredited. Lender shall have the right to review and approve or rej ect any proposed changes to scope of said agreement and to changes in the real estate property management company prior to making such changes. Any such changes made without Lender approval shall be an Event of Default under this Loan Agreement. Lender has approved EAH Housing (EAH Inc.) as the qualified property management company for the Project

5.3. BORROWER'S RESPONSIBILITIES. To prevent and avoid construction defects, Borrower shall inspect, review, supervise, and assure the high quality, adequacy, and suitability of: (i) the Plans and Specifications and all changes and amendments; and (ii) architects, contractors, subcontractors, and material suppliers employed or used in the Project, and the workmanship of and the materials used by all of them; and (ii i) the progress and course of construction and its conformance with the Plans and Specifications and any amendments, alterations, and changes that may be approved by Lender. Borrower will, at Borrower's expense, defend, indemnify, save, and hold Lender ha rmless against all claims, demands, losses, expenses, damages (general, punitive, or otherwise), and causes of action (whether legal or equitable) asserted by any Person arising out of the use of the proceeds of the Loan. Borrower will pay Lender on deman d all claims, judgments, damages, losses, or expenses (including attorney fees and expenses) incurred by Lender as a result of any legal action arising out of the use of the proceeds of the Loan. The provisions of this Section will survive the termination of this Loan Agreement and the repayment of the Loan.

6. INSURANCE.

6.1. PROPERTY INSURANCE. Borrower shall procure and maintain property insurance in a form and substance approved by Lender. Coverage shall be for protection against loss of, or damage to the Property and its improvements to their full insurable value. Borrower shall also procure and maintain insurance against specific hazards affecting Lender's security for the Loan as may be required by Lender, governmental regulations, or any permanent len der. All such policies shall contain a standard mortgagee loss payable clause in favor of Lender. The insurance required shall be written with a deductible of not more than Twenty-Five Thousand Dollars ($25,000.00).

6.2. COMMERCIAL GENERAL LIABILITY AND OTHER INSURANCE. Borrower shall carry insurance as set forth below, effective prior to the disbursement of the Loan, and such insurance shall be maintained in full force and effect at al l Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 9
times. Such insurance coverage must list Lender as an additional i nsured, and must be approved in writing by Lender prior to the disbursement of the Loan.

6.2.1. Commercial general liability insurance, in Insurance Services Office (ISO) policy form CG 00 01 or equivalent, with limits of liability not less than: $1,000,000 pe r occurrence, and $2,000,000 general aggregate, all per location of the project, such coverage to include contractual liability to include bodily injury, property damage and persona l injury;

6.2.2. Personal injury insurance with the employment exclusion deleted, unless Lender gives prior written approval for the employment exclusion to remain in the policy;

6.2.3. Workers’ compensation and all other insurance required under applicable law, in the amount required by applicable law or by Lender, whichever amount is greater.

6.3 INSURANCE PROVISIONS. Each policy of insurance required under this Loan Agreement shall be obtained from a provider licensed to do business in California and having a current Best's Insurance Guide rating of A VII or better, which rating has been sub stantially the same or increasing for the last five (5) years, or such other equivalent rating, as may reasonably be approved by Lender's legal counsel. Each policy shall contain the following provisions as applicable, unless otherwise approved by Lender's legal counsel in writing in advance:

6.3.1 ADDITIONAL INSURED. Borrower shall obtain a policy in ISO form CG 20 33, or equivalent, naming Lender
as additional insured under the Commercial General Liability Policy at the same limits as required above.

6.3.2 SINGLE PROPERTY INSURANCE. It is the intent of the parties that the Project have available all the specified insurance coverages. Borrower shall not provide insurance coverages that are considered in aggregate with other properties which Borrower owns or operates.

6.3.3 CERTIFIED POLICY COPY. Borrower shall provide Lender with a certified copy of each required policy of insurance, upon request by Lender. Borrower shall provide Lender with a Certificate of Insurance of Insurance for each policy on the applicable ACORD form and, specific sections of the policy may be requested by Lender for review. The ACORD form shall not substitute for the policy, if the policy is requested. The most current ACORD 25 -S “Certificate of Liability Insurance shall be used for liability insurance.

6.3.4 CANCELLATION. Each policy shall bear an endorsement precluding cancellation or termination of the policy or reduction in coverage unless Lender has been given written notice of such intended action at least thirty (30) days prior to its effective date. In the alternative to such endorsement, Borrower will provide Lender with the cancellation clause and/or any amendatory endorsements that modify or change the policy cancellation clause of the insurance policies in force.

It is Borrower’s responsibility to notify Lender of any notice of cancellation, non -renewal or non -payment of premium in accordance with your policy provisions. In the event insurance is cancelled or not renewed, Borrower shall notify Lender within forty-eight (48) hours of such cancellation or non-renewal.

_____Borrower’s Initials

6.3.5 FAILURE TO MAINTAIN. If Borrower fails to obtain or maintain, or cause to be obtained and maintained, any insurance required by this Loan Agreement, Lender shall have the right to purchase the insurance on Borrower’s behalf, and Borrower shall promptly reimburse the full cost of such insurance to Lender. If Borrower fails to reimburse Lender for insurance, the amount of unpaid reimbursement shall bear interest, at the maximum rate permissible under the law, until paid.

7. NONLIABILITY FOR NEGLIGENCE, LOSS, OR DAMAGE. Borrower acknowledges, understands, and agrees as follows:

7.1. The relationship between Borrower and Lender is, and will at all times remain, solely that of borrower and lender, and Lender neither undertakes nor assumes any responsibility for or duty to Borrower to select, review, inspect, supervise, pass judgment on, or inform Borrower of the quality, adequacy, or suitability of the Project work, except as to matters which are within the intent and purpose for which Lender has made the Loan.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 10

7.2. Lender owes no duty of care to protect Borrower against negligent, faulty, inadequate, or defective building or construction.

7.3. Lender will not be responsible or liable to Borrower for any loss or damage of any kind to person or property whether suffered by Borrower or any other Person or group of Persons or for negligent, faulty, inadequate, or defective building or construction, and Borrower will hold Lender harmless from any liability, loss, or damage for these things.

7.4. BORROWER RESERVES. Borrower shall maintain reserves for replacement and repairs required to be made to the Property, fixtures on the Property or personal property used on the Property, or otherwise as approved by Lender, in an amount, at all times, of not less than Seventy Thousand Dollars and No/100 Dollars ($70,000.00) per year, commencing upon initial occupancy of the Project

7.5. FINANCIAL REPORTING. During the term of the Loan, Borrower shall deliver to Lender within 120 days of the end of each calendar year audited Financial Statements prepared in accordance with generally accepted accounting principles and signed by authorized officers of Borrower. Prior to the Close of Escrow and during the term of the Loan, Borrower shall deliver to Lender any such additional Financial Statement as may be requested by Lender. Lender reserves the right to review and approve Financial Statements and other credit information and references prior to the Close of Escrow.

During the term of the Loan, Borrower must deliver to Lender a monthly rent -roll including household composition information and operating statements with respect to the Property and improvements, as Lender may request.

7.6. ANNUAL ADMINISTRATIVE FEE. Borrower agrees to pay an ann ual administrative fee (“Fee”) to Lender as compensation for monitoring compliance with regulatory restrictions and the administration of the Loan. Borrower shall pay annually a Fee equal to $25,000 Fee payments shall commence on the Closing Date for the prorated semiannual period from the Closing Date to and including October 31, 2023, and in equal semiannual installments in advance on each May 1 and October 1 of each year thereafter throughout the term of the Regulatory Agreements.

7.7. BOND PROCEEDS. Borro wer shall secure financing in the amount of Forty-Six Million Three Hundred Forty-Eight Thousand Forty-Eight Dollars and No Cents ($46,348,048.00) in bond proceeds from the Housing Authority of the City of Sacramento (the “Bond Issuance Amount”).

8. LOAN. Lender agrees to lend to Borrower, and Borrower agrees to borrow from Lender, an amount not to exceed the Loan Amount, to finance the development of the Project and for other purposes as specified in the Scope of Development, subject to the terms, conditions, representations, warranties, and covenants in this Loan Agreement.

8.1. PRINCIPAL AMOUNT. The principal amount of the Loan shall be the actual disbursements of Lender on account of the Project, not to exceed the amounts stated in the Budget (as the Budget may be adjusted by written approval of Lender). In any event, the principal amount of the Loan shall not exceed the Loan Amount.

8.2. USE OF LOAN FUNDS. Loan funds shall be used solely for actual costs of the Project as stated in the Budget.

No Loan funds shall be used for any costs, except as provided in the Budget. Unless otherwise noted in the Budget, allowed predevelopment costs, if any, are not subject to the withholding as Retention.

8.3. LOAN TERMS. The Loan is made pursuant to the Loan Program and is subject to the laws, rules and regulations of the Loan Program. Lender agrees to disburse the Loan Proceeds in the manner and subject to the limitations stated in this Loan Agreement. Interest, at the Interest Rate, shall accrue on each disbursement of Loan Proceeds commencing on the date on which each such disbursement is made. Repayment of the loan shall be made, in payments of principal and interest, in lawful tender of the United States, in accordance with the Payment Schedule.

8.4. CLOSING IN ADVANCE OF SENIOR LOAN. Lender will subordinate this Loan to the senior loan, provided that the senior loan does not require modification of this Loan Agreement

8.5. NOTE AND SECURITY DOCUMENTS. The Loan is evidenced by the Note executed by Borrower in favor of Lender and delivered to Lender upon Close of Escrow. Repayment of the Note is secured by the Trust Deed covering the Property and the Project. Borrower shall execute the Trust Deed in favor of the Title Company as Trustor in trust for the benefit of Lender and deliver it to Escrow for recordation. The Loan is also secured by the Additional Collateral, if any, as evidenced by the applicable Security Documents.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 11

8.6. SECURITY AGREEMENT. This Loan Agreement is a "security agreement" within the meaning of the Uniform Commercial Code. Borrower by executing and delivering this Loan Agreement has granted and hereby grants to Lender, as security for the Loan, a security interest in the Additional Collateral to the full extent that the Additional Collateral may be subject to the Uniform Commercial Code. Borrower irrevocably appoints Lender as its true and lawful limited attorney-in-fact solely to execute and deliver any and all financing statements pursuant to the appropriate statutes, and any other documents or i nstruments as are required to convey to Lender a valid perfected security interest in the Additional Collateral. Borrower agrees to perform all acts which Lender may reasonably request so as to enable Lender to maintain such valid perfected security inter est in the Additional Collateral in order to secure the payment of the Note in accordance with their terms. Lender is authorized to file a copy of any such financing statement in any jurisdiction(s) as it shall deem appropriate from time to time in order to protect the security interest established pursuant to this Loan Agreement. Lender may require at any time, and from time to time additions of new contracts and other property to the Additional Collateral.

Borrower irrevocably assigns to Lender, effective upon Lender’s written demand, as security for the due performance of this Loan Agreement all of its right, title, and interest in the Assigned Documents.

8.7. REGULATORY AGREEMENTS. The Regulatory Agreement s imposing covenants, conditions and restrictions running with the land are a material consideration for the making of the Loan. Borrower shall execute the Regulatory Agreements prior to Close of Escrow and deliver them to Escrow for recordation. Violation of the Regulatory Agreements is an Event of Default of this Loan.

8.8. ESCROW. The parties shall open the Escrow promptly after the Effective Date. Escrow shall close as provided in the Escrow Instructions on or before the Closing Date.

8.9. COMMISSIONS. Lender is not responsible, by this Loan Agreement or otherwise, to pay commissions in relation to this transaction.

8.10. ACCELERATION ON TRANSFER OR REFINANCING OF THE PROPERTY; ASSUMPTION. Except as otherwise provided in the Loan Agreement, if all or any part of the Property or an interest in the Property is sold, transferred or conveyed to any person, or the cash flows change without Lender's prior written consent, Lender may, at Lender's option, declare all the sums secured by the Trust Deed to be immediately due and payable . Lender shall have waived such option to accelerate if, prior to the sale or transfer, Lender and the Person to whom the Property is to be sold or transferred reach agreement in writing that the Loan may be assumed. If Lender has waived the option to accelerate provided in this Section and if Borrower's successor in interest has executed a written assumption agreement accepted in writing by Lender, Lender shall release Borrower from all obligations under the Trust Deed and the Note.

9. TITLE INSURANCE. Borrower must procure and deliver t o Lender an ALTA Lender's Policy of Title Insurance, together with such endorsements as Lender may require, including but not limited to ALTA endorsement nos. 9.6 and 9.7 (CLTA endorsement nos. 100 and 116) and ALTA endorsement no. 25 (CLTA endorsement no. 116) insuring Lender in an amount equal to the principal amount of the Loan, that Lender 's Trust Deed constitutes a third lien or charge upon the Property and improvements subject only to such items as shall have been approved by Lender. There must be no exceptions permitted for mechanics liens. Title insurance for the Loan must be issued by a title insurer approved by Lender.

10. PERFORMANCE CONDITIONS. The following are conditions precedent to performance under this Loan Agreement:

10.1. CONDITION OF TITLE. Lender shall cause Escrow Agent to issue to Borrower (with a copy to Lender) the Preliminary Report, together with copies of all documents relating to title exceptions referred to in the Preliminary Report.

At Close of Escrow, Lender’s Trust Deed shall b e a valid lien against the Property securing the Loan and subject to no exceptions to title (of record or off record) other than the exceptions listed in the “Conditions of Title” in the Escrow Instructions.

10.2. CONDITIONS TO LENDER'S PERFORMANCE. Lender's obligation to perform under this Loan Agreement is subject to all of the following conditions: (a) Borrower has performed all of its obligations then to be performed pursuant t o this Loan Agreement; (b) Borrower has met the Additional Conditions to Close of Escrow and applicable Special Provisions, if any; (c) the closing conditions as defined in the Escrow Instructions have been fulfilled as of Close of Escrow; (d) Borrower’s representations and warranties in this Loan Agreement are true and correct as of the date of this Loan Agreement and as of Close of Escrow; (e) this Loan Agreement continues to be in full force and effect, no default on the part of Borrower has occurred under this Loan Agreement, and no event has occurred that, with the giving of notice or the passage of time, will constitute a default by Borrower under this Loan Agreement; and (f) Lender has approved the Approval Documents.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 12

10.3. CONDITIONS TO BORROWER'S PERFORMANCE. Borrower's obligation to perform under this Loan Agreement is subject to s atisfaction of all of the following conditions: (a) the closing conditions as defined in the Escrow Instructions have been fulfilled as of Close of Escrow; (b) Lender has met the Additional Conditions to Close of Escrow and applicable Special Provisions, if any; (c) Lender’s representations and warranties in this Loan Agreement are true and correct as of the date of this Loan Agreement and as of the Close of Escrow; and (d) this Loan Agreement continues to be in full force and effect, and no default on the part of Lender has occurred under this Loan Agreement.

11. [Intentionally Deleted]

12. CONSTRUCTION. As a condition of the Loan, Borrower will diligently proceed with construction in accordance with the Scope of Development as approved by Lender. Borrower shal l complete such work on or before the Completion Date, subject to Unavoidable Delay.

12.1. CHANGES. In order to assure sufficient funding for the Project, Borrower shall not authorize any Change without the prior written consent of Lender. If in the judgment of Lender, a Change, together with all other Changes contemplated or previously approved by Lender, will cause an increase in the cost of the Project in excess of the contingency reserve identified in the Budget, then Borrower will, as a condition precedent to Lender's consent, provide Lender with proof that the contingency reserve has been increased as necessary to pay for all such Changes. Borrower will submit any such Change to Lender for approval on a form acceptable to Lender, together with approvals by the Project Architect, if any, and the General Contractor. Borrower shall maintain funds available in the contingency reserve that are in substantially the same percentage of the original contingency reserve as the percentage of the Project then remain ing to be completed.

12.2. CONTRACTORS AND CONTRACTS. All contracts, subcontracts, contractors, and subcontractors shall be subject to Lender's approval prior to the Closing Date. Lender also reserves the right to require performance and material payment bonds on any or all contractors, or in lieu of bond a letter of credit acceptable in form and substance to Lender, as it determines to its sole satisfaction. Upon Lender’s request, Borrower will furnish to Lender correct lists of all contractors , subcontractors and material suppliers employed in connection with the Project, specifying their addresses, their respective portion of the Project and their respective Project cost. Lender may contact directly each contractor, subcontractor, and material supplier to verify the facts disclosed by the list or for any other purpose related to the Loan. All contracts by Borrower or its contractors relating to the Project will require terms sufficient to permit disclosure to Lender of any information Lender deems, in its sole determination, necessary to make such verifications.

12.3. NO DISCRIMINATION DURING CONSTRUCTION. Borrower for itself, the general contractor and their respective successors and assigns, agrees that the following provisions shall apply to, and be contai ned in all contracts and sub-contracts for the construction of the Project:

12.3.1. EMPLOYMENT. Borrower shall not discriminate against any employee or applicant for employment because of sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation. Borrower will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their sex, race, color, religion, ancestry, national origi n, disability, medical condition, marital status, or sexual orientation. Such action shall include, but not limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. Borrower agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by Lender setting forth the provisions of thi s nondiscrimination clause.

12.3.2. ECONOMIC OPPORTUNITY EMPLOYMENT REQUIREMENTS. This Loan requires that to the greatest extent feasible, opportunities for training and employment be given to lower income residents in and around the area of the project. Borrower will instruct its General Contractor and its subcontractors to utilize lower income project area residents as employees to the greatest extent feasible by:

(a) Identifying the number of positions in the various occupational categories including skilled, semi-skilled, and unskilled labor, needed to perform each phase of the Project;

(b) Identifying, within the positions identified in Paragraph (1) of this subsection, the number of positions in the various occupational categories which are currently occupied by regular, permanent employees;

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 13
(c) Identifying, within the positions described in Paragraph (1) of this subsection, the number of positions in the various occupational categories which are not currently occupied by regular, permanent employees;

(d) Establishing the positions identified in Paragraph (3) of this subsection, a goal which is consistent with the purpose of this subsection within each occupational category of the number of positions to be filled by lower income Project area residents; and

(e) Making a good faith effort to fill all of the positions established in Paragraph (4) of thi s subsection with lower income Project area residents through Greater Sacramento Urban League, Sacramento Works, Sacramento Employment Training Agency, or similar local workforce agencies.

12.3.3. ADVERTISING. Borrower will, in all solicitations or advertisement s for employees placed by or on behalf of Borrower, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, creed, sex, marital status, national origin, ancestry, familial status, or disability .

12.3.4. MONITORING PROVISIONS. Borrower, the General Contractor and subcontractors shall comply with the requirements of Lender for monitoring the anti-discrimination and all applicable labor requirements.

12.4. INSPECTION. Lender may, at any time and without notice to Borrower, enter on the Property and inspect the Project; and, during regular business hours, examine the books, records, accounting data, plans, shop drawings, specifications, and other documents of Borrower pertaining to the Project and to make extracts or copies. Borrower shall make all such documents available to Lender promptly on demand. Borrower agrees to cooperate fully (and to cause the General Contractor to cooperate fully) with Lender and its Lender's designated agent and to permit all appropriate access to the Property and to all relevant books and records. Borrower shall bear the cost of reasonable inspections, except that Lender shall bear its costs of inspection. If however, Lender’s inspection discovers issues of a nature that req uire further third-party review or investigation, Borrower shall bear the costs of such third party review.

12.5. PROTECTION AGAINST LIEN CLAIMS. Borrower shall promptly and fully discharge all claims for labor, materials and services in connection with the Pr oject. Borrower shall promptly file a valid Notice of Completion on completion of the Project. Borrower shall promptly file a Notice of Cessation in the event of a cessation of labor on the Project for a continuous Period of (30) days or more. Borrower shall take all other reasonable steps to protect against the assertion of lien claims against the Property. Within ten (10) days after the filing of any claim of lien against the Propert y, Borrower shall record a surety bond in the office of the Recorder o f the County where the Property is located in an amount sufficient to release the claim of lien or deliver to Lender any other assurance as may be acceptable to Lender as evidenced by Lender's written acceptance of such assurance.

12.5.1. Lender, at any time, may require Borrower to obtain a lien waiver with respect to each payment to the General Contractor and each payment by the General Contractor or Borrower to each of the various subcontractors and material suppliers. Lender, at any time, may require Borrower to make any payments for the Project by joint check made payable to the General Contractor and subcontractor for whose account the payment is to be made, as joint payees.

12.5.2. In any event, Borrower is not required to pay, prior to adjudication, any claims for labor, materials, or services that Borrower, in good faith, reasonably disputes, and that Borrower, at its own expense, is currently and diligently contesting in the proper forum, provided that Borrower has filed the surety bond or given Lender such oth er assurance as Lender accepts in writing.

12.6. PAYMENT AND PERFORMANCE BONDS. As a condition precedent to beginning construction of the Project, Borrower shall provide Lender a performance bond and a labor and material payment bond obtained by Borrower or its general contractor in favor of Borrower and Lender as named dual obligee s, in form and amount as approved by Lender and securing, respectively, completion of the work and payment of all labor and material suppliers and subcontractors for the work as stated in the construction contract for the Project. The bonds shall be written with a surety listed as acceptable to the federal government on its most recent list of sureties. Borrower shall assure compliance with all requirements of the surety.

Borrower shall permit no changes in the work to be performed by the general contractor and shall make no advance payments to the general contractor without prior written notice to the surety and Lender, if such change or payment could release the surety of its obligations under the bonds.

12.7. OTHER LENDER DRAW. Borrower shall concurrently submit to Lender any Other Lender Draw. Delivery of such Other Lender Draw shall be made in the same manner as any other notice, except that it shall also be marked “OTHER Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 14
LENDER DRAW REQUEST” and delivered to the person named in writing by Lender as the recipient of such requests or, in the absence thereof, to Lender’s Portfolio Management office. Borrower shall provide Lender with true, accurate and correct copies of each Other Lender Draw, if any, including without limitation all supporting information , documents, and other required submittals. Lender shall have the right to reject an Other Lender Draw, for failing to comply with the Loan, for changing the Project in any material way, or for impairing the ability of Lender to enjoy the practical realiz ation of its rights under the Loan and its related instruments. If Lender rejects an Other Lender Draw, Borrower shall withdraw the notice for such Other Lender Draw and shall not accept and shall return to Lender any disbursement on account of such Other Lender Draw. If lender does not reject an Other Lender Draw by written notice to the Other Lender and Borrower within fifteen (15) business days following delivery of such Other Lender Draw to Lender, Lender shall be deemed to have approved such Other Lender Draw hereunder.

12.8. ACKNOWLEDGMENT OF RELIANCE. Borrower acknowledges that Lender is making Loan disbursements in advance of disbursements of other lenders in reliance upon Borrowers compliance with this provision.

12.9. LIQUIDATED DAMAGES. IF BORROWER FAILS TO PROVIDE TO LENDER ANY OTHER LENDER DRAW, AS AND WHEN REQUIRED UNDER THIS LOAN AGREEMENT, LENDER SHALL BE IRREP ARABLY HARMED IN THA T BORROWER’S ABILITY TO REPAY THE LOAN AND LENDER’S SECURITY FOR THE LOAN SHALL BE IMPAIRED TO AN UNKNOWN EXTENT. BORROWER AND

LENDER AGREE THAT IT WOULD BE IMPRACTICAL OR EXTREMELY DIFFIC ULT TO FIX ACTUAL RE SULTING DAMAGES IN S UCH EVENT. BORROWER AND LENDER, THEREFORE, AGREE THAT AN AMOUNT EQUAL TO TWO PERCENT (2%) OF THE LOAN AMOUNT

SHALL CONSTITUTE LIQ UIDATED DAMAGES P AYABLE TO LENDER ON ACCOUNT OF SUCH EVENT, RECEIPT OF WHICH SH ALL CONSTITUTE THE EXCLUSIVE REMEDY OF LENDER FOR SUCH EVENT, AND ONLY FOR SUCH EVENT. PAYMENT OF SAID AMOUNT

TO LENDER AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY WITHIN THE MEANING OF CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT INSTEAD, IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO LENDER PURSUANT TO SECTIONS 1671, 1676 AND 1677 OF THE CALIFORNIA CIVIL CODE. SAID AMOUNT SHALL BE IMMEDIATELY DUE AND PAYABLE AS OF THE DATE ON WHICH BORROWER DELIVERED SUCH OTHER LENDER DRAW TO THE OTHER LENDER. LENDER SHALL HAVE THIRTY (30) DAYS AFTER RECEIVING ACTUAL NOTICE OF S UCH EVENT TO NOTIFY BORROWER IN WRITING T HAT LIQUIDATED DAMAGES UNDER THIS SECTION ARE DUE. BORROWER SHALL HAVE FIFTEEN (15) DAYS AFTER SUCH WRI TTEN NOTIFICATION

TO CURE THE DEFAULT BY WITHDRAWING THE OTHER LENDER DRAW AND RETURNING ANY DISBURSEMENT ON ACCOUNT OF SUCH OTHER LENDER DRAW. IF BORROWER FAILS TO PAY LIQUIDATED DAMAGES WHEN DUE UNDER THIS SECTION, THE LOAN SHALL BE ALL DUE AND PAYABLE AT THE ELECTION OF LENDER. _____Lender’s Initials

_____Borrower’s Initials

12.10. PROJECT SIGN. If Borrower places a sign on the Property during construction stating the names of the Project participants, it shall also name Lender as a participant in the Project. Lender’s name on the sign shall be in letters not less than size of letters used to name any of the other participants.

12.11. NO PRIOR LIENS. Borrower shall not allow the Project construction to begin or materials to be delivered to the Project until after Close of Escrow.

PREVAILING WAGES. , Borrower shall pay prevailing wages for the Project. Therefore, Borrower indemnifies, holds harmless and defends Lender from all additional wages, benefits, fees, penalties, fines, legal fees, court costs, arbitration costs, and other costs arising from the improper application of California prevailing wage laws to the Project by Borrower or General Contractor or both of them. In accordance with Labor Code Section 1720(c)(6)(E)), so long as the public subsidy for the Project consists of below market rate loans, and the Project restricts occupancy on at least 40% of the units for at least 20 years to individuals or families earning no more than 80% of the area median income, the Project is not subject to prevailing wages. Borrower represents to Lender that Borrower has obtained no public subsidy for the Project that does not meet such criteria. If Borrower obtains other non -qualifying public subsidy, Borrower shall pay prevail ing wages for the Project.

Therefore, Borrower indemnifies, holds harmless and defends Lender from all additional wages, benefits, fees, penalties, fines, legal fees, court costs, arbitration costs, and other costs arising from the improper application of California prevailing wage laws to the Project by Borrower or General Contractor or both of them. If more than eleven (11) units are assisted with HOME funds as the Funding Source (as indicated in the Regulatory Agreement), Borrower shall comply with Davi s-Bacon prevailing wage requirements as described in the Funding Requirements.

13. LOAN DISBURSEMENT PROCEDURES.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 15

13.1. CONDITIONS PRECEDENT TO EACH LOAN DISBURSEMENT. The obligation of Lender to make any disbursements of Loan Proceeds shall be subject to the following conditions precedent:

13.1.1. No Event of Default or Potential Default of Borrower has occurred and is continuing;

13.1.2. If requested by Lender, Borrower has furnished to Lender, as a Project cost, an endorsement to the Title Policy showing no intervening li ens or encumbrances on the Property and insuring the full disbursement, together with a satisfactory report under the California Uniform Commercial Code showing no liens or interests other than those of Lender;

13.1.3. Borrower has obtained and maintained, and Lender has approved a loan from a financial institution or other lender approved by Lender in its sole discretion, to make the permanent financing obtained by Borrower, or has obtained commitments to issue bonds, which repays after completion of the Projec t all construction and other loans secured by the Project and which is secured by a senior lien against the Property. Such permanent financing must provide: (a) that it is subject only to those conditions that are usual and customary in the industry and th at can be satisfied by the proposed closing date of the permanent financing; (b) that it is in full force with no default by any party; (c) any such loan approval or commitments for financing shall not require modification of the Loan Documents, (d) any such loan approval or commitments shall not be based upon sources and uses of Project funds that are different from those approved by Lender for the Project, and (e) that Lender will have notice of, and a reasonable opportunity to cure, any Borrower defaults ;

13.1.4. Lender is satisfied that all completed work has been done using sound, new materials and fixtures, in a good and proper manner, and all materials, fixtures, and furnishings installed on or acquired for the Property will be owned by Borrower free of any liens, encumbrance, or other interests of any kind other than Lender's lien or security interest;

13.1.5. The representations and warranties in the Loan Documents are correct as of the date of the requested disbursement;

13.1.6. Borrower has paid Lender all commitment, loan, and other fees then due, and Borrower has submitted to, and Lender has approved in writing, all documents, records, statements, certificates, reports, and other materials and information then required to be submitted to Lender for approval under this Loan Agreement;

13.1.7. Borrower shall provide assurances, satisfactory to Lender in its sole discretion, that hazardous materials are not present on the Property or that any hazardous materials on the Property will be remediated and that no further remediation is then required by the environmental agency having responsibility for monitoring such remediation; and

13.1.8. Borrower has delivered to Lender all funds, documents, instruments, policies, evidence of satisfaction of conditions, and other materials then due or otherwise requested by Lender under the Loan Documents.

13.2. CONDITIONS PRECEDENT TO FIRST DISBURSEMENT. Borrower’s request for the first disbursement of Loan Proceeds (the “First Disbursement”) is a representation and warranty by Borrower that there has been no material adverse change in Borrower’s financial capacity or in any representation made to Lende r in Borrower’s application for the Loan or Borrower’s supporting documentation. Lender shall make the First Disbursement when the following conditions precedent and the conditions precedent stated in Section 13.1 have been met:

13.2.1. There is no legal action threatened or pending against Borrower or affecting the Property or any Additional Collateral;

13.2.2. All conditions to Close of Escrow have been satisfied in accordance with the Loan Agreement;

13.2.3. Borrower has obtained and Lender has approved a loan approval , from a financial institution or other lender approved by Lender in its sole discretion, to make the permanent financing obtained by Borrower, or has obtained commitments to issue bonds, which repays after completion of the Project all construction and other loans secured by the Project and which is secured by a senior lien against the Property. Such permanent financing approval, must provide: (a) that it is subject only to those conditions that are usual and customary in the industry and that can be satisfied by the proposed closing date of the permanent financing; (b) that it is in full force with no default by any party; and (c) that Lender will have notice of, and a reasonable opportunity to cure, any Borrower defaults;

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 16

13.2.4. Borrower has provided proof of all insurance required by the Loan Documents;

13.2.5. The construction lender’s commitment to make a construction loan is in full force, has not been modified and no event has occurred that with notice or the passage of time or both could result in the termination of it.

Nothing in the permanent loan commitment, or submissions and approvals made under it, conflicts with this Loan Agreement.

Borrower has done all things necessary to keep unimpaired its rights under the loan commitment for the construction lender's construction loan;

13.2.6. Borrower has filed all tax returns required to be filed and paid all taxes due, which, if unfiled or unpaid, might adversely affect Lender’s security under the Security Documents; and

13.2.7. Borrower must request the First Disbursement consistent with the terms and conditions of this Loan Agreement no later than 11 months following the Effective Date of this Loan Agreement.

13.3. CONDITIONS PRECEDENT TO FINAL DISBURSEMENT. Lender shall make the final loan disbursement under this Loan Agreement when the following conditions precedent and the conditions precedent stated in Section 13.1 have been met:

13.3.1. As applicable, the Project architect and Lender's designated agent will have certified to Lender, on AIA Form G704 and in a manner satisfactory to Lender:

(a) That the Project has been duly completed in a good and proper manner using sound, new materials;

(b) That the Project complies with the Plans and Specifications, the requirements of all Governmental Authorities and any other party having enforceable rights regarding the construction of the Project; and

(c) That the Project is structurally sound.

13.3.2. Borrower has provided to Lender a true, accurate and complete copy of the final draw request to all other lenders for the Project;

13.3.3. Borrower has filed all tax returns required to be filed and paid all taxes due, which, if unfiled or unpaid, might adversely affect Lender’s security under the Security Documents;

13.3.4. Title policy endorsements in form and amount satisfactory to Lender (including an endorsement insuring lien-free completion of the Project) have been furnished to Lender;

13.3.5. Borrower has furnished evidence, in form and substance satisfactory to Lender, that:

(a) The General Contractor and subcontractors and material suppliers and their subcontractors and material suppliers have been paid in full;

(b) Borrower has obtained final certificates of occupancy for all of the Project;

(c) All other permits and approvals necessary for the construction, equipping, management, operation, use, or ownership of the Project have been obtained, subject only to those conditions approved by Lender, and

(d) The completed Project complies with all applicable zoning regulations, subdivision map acts, building code provisions, and similar governmental laws and regulations, and has all utilities and adequate ingress and egress from public streets, that evidence to be in the form of a certificate executed by Borrower in favor of Lender.

13.3.6. That Borrower has provided to Lender an inventory showing make, model, value, cost, and location of all furniture, fixtures, and equipment and other personal property of a value in excess of $1,000 and used in the management, maintenance, and operation of the Project, that are included in the collateral for the Loan;

13.3.7. Borrower has filed a notice of completion of the Project necessary to establish the commencement of the shortest statutory period for filing of mechanics' and materialmen's liens; Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 17

13.3.8. Lender has received written approval from the surety on any bond required by Lender;

13.3.9. Borrower has submitted to Lender a final cost certification prepared by a CPA; and

13.3.10. Borrower must request Final Disbursement consistent with terms and conditions of this Loan Agreement no later than 3 years and 11 months following the Effective Date of this Loan Agreement. If Borrower failures to request Final Disbursement consistent with the terms and conditions of this Loan Agreement within 3 years and 11 months of the Effective Date the remaining funds will be recaptured.

13.4. MAKING DISBURSEMENT. Lender shall pay each disbursement request within twenty (20) business days after the disbursement request is submitted to Lender, subject to fulfillm ent of the conditions precedent as stated in Section

13.1. Lender shall disburse the actual cost of the work represented in the disbursement reque st by Borrower, reduced by the cost of work included in the request and not satisfactorily completed and by the amount of the Retention to be withheld.

13.5. DISBURSEMENT OF LESS THAN FULL REQUEST. If Lender makes a disbursement which is less than the full amount of the disbursement requested, Lender shall inform Borrower of the items disallowed for disbursement and the reason for disallowing them. Lender shall disburse the Loan in the following order of priority, except as expressly provided and unless paid by Borrower from other funds: (a) first, to pay Lender's Loan fees and expenses due; (b) second, to pay Lender the interest due on the Loan; (c) third, at Lender's option to pay all impositions due; (d) fourth, at Lender's option, to make any other paymen ts that Lender may in its sole discretion deem necessary or advisable to protect Lender's security under the Loan Documents; and (e) fifth, to make the disbursement of funds then due in response to Borrower’s current request for disbursement. For purposes of this section, impositions means all real estate and personal property taxes and other taxes and assessments, water and sewer rates and charges, and all other charges of a Governmental Authority and any interest or costs or penalties with respect to them, ground rent and charges for any easement or agreement maintained for the benefit of the Property, of every nature and any kind that at any time may be assessed, levied, imposed, or become a lien on the Property, Fixtures or income received from the Property or Fixtures, or any use or occupancy of the Property; and any charges, expenses, payments, or assessments of any nature that are or may become a lien on the Property or the income received from it.

13.6. NO WAIVER BY DISBURSEMENT. Regardless of the failur e of any condition precedent to Lender's obligation to make disbursements to Borrower, Lender may make a disbursement if Lender, in its sole discretion, determines it to be advisable. The making of any disbursement shall not be deemed to constitute an app roval or acceptance by Lender of the work completed or a waiver of the condition with respect to a subsequent disbursement.

13.7. COMPLIANCE. To the best of Borrower's knowledge, the construction, use, and occupancy of the Property and Project comply in full with, or if built according to the Plans and Specifications, will comply in full with, all Governmental Requirements. No right to construct or use the Project is to any extent dependent on any real property other than the Property.

All approvals, licenses, permits, certifications, filings, and other actions normally accepted as proof of compliance with all Governmental Requirements by prudent lending institutions that make investments secured by real property in the general area of the Property, to the ext ent available as of the date of this Loan Agreement, have been given or taken, or Borrower is entitled to have them given or taken as the ministerial act of the applicable Governmental Authority.

14. RESIDENTIAL OPERATIONS.

14.1. VERIFICATION OF NET INCOME. When requested by Lender, Borrower shall provide Financial Statements and such other evidence as Lender may deem necessary to verify the Project net income, including without limitation copies of certified rent rolls, bank statements, billing statements and invoices.

14.2. SECURITY AND LIGHTING. Project shall include a security camera system approved by Lender and lighting adequate to properly illuminate the parking area and all common spaces. In addition, Project will include security patrol, if necessary.

14.3. RESIDENT SERVICES PLAN: Borrower shall provide Lender with a detailed resident services plan including but not limited to the following information: (1) identification of all entities responsible for providing resident services to Project tenants and each entity’ s role in the provision of those services; (2) the services will be provided for a minimum of 60 hours per week, including education activities and service coordination; (3) a description of the services to be provided; (4) a pro forma resident services budget.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 18

14.4. SMOKE FREE ENVIRONMENT. All residential units and indoor common areas must be smoke free.

15. DEFAULT.

15.1. EVENTS OF DEFAULT. At the option of Lender, each of the following events will constitute an Event of Default, subject to applicable cure rights, if any:

15.1.1. Borrower’s non-performance of any obligation or breach of this Loan Agreement

15.1.2. The occurrence of a breach or default under any of the Loan Documents after the expiration of applicable notice and cure periods;

15.1.3. Subject to Borrower’s legal rights to contest a Governmental Requirement, Borrower's failure to comply with any Governmental Requirement, unless within ten (10) days after notice of such failure by Lender or the respective governmental entity or after any action has been commenced to enforce s uch requirement, Borrower has cured such failure;

15.1.4. Borrower's failure to keep in full force any permit, license, consent, or approval with respect to the construction, occupancy, or use of the Project, unless within ten (10) days after notice by the issuin g entity or Lender of such failure, Borrower has promptly cured such failure;

15.1.5. Any material deviation from the Plans and Specifications in the construction of the Project (unless approved by Lender) , or the appearance or use of defective workmanship or mat erials in the construction of the Project, if Borrower fails to remedy them or to diligently proceed to remedy them to Lender's satisfaction within ten (10) days after Lender's written demand to do so;

15.1.6. Borrower's failure to complete the construction of th e Project by the Completion Date, subject to Unavoidable Delay;

15.1.7. The filing of any lien against the Property or Project or the service on Lender of any bonded stop notice related to the Loan, if the claim of lien or bonded stop notice continues for thirty (30) days without discharge, satisfaction, or the making of provision for payment (including bonding) to the satisfaction of Lender;

15.1.8. The attachment, levy, execution, or other judicial seizure of any portion of the Property or Project, or any substantial p ortion of the other assets of Borrower, that is not released, expunged, bonded, discharged, or dismissed within thirty (30) days after the attachment, levy, execution, or seizure; and

16. Making of any unauthorized payment from Loan Proceeds or other funds of Lender.

REMEDIES.

16.1. OPTION TO ACT. On the occurrence of any Event of Default, subject to applicable notice and right to cure provisions, in addition to its other rights in this Loan Agreement or in any of the other Loan Documents, at law, or in equity, Lender may, without prior demand, exercise any one or more of the following rights and remedies:

16.1.1. Terminate its obligation to make disbursements;

16.1.2. Declare the Note and all other sums owing to Lender with respect to the other Loan Documents immediately due;

16.1.3. Make any disbursements after the happening of any one or more of the Events of Default, without waiving its right to demand payment of the Note and all other sums owing to Lender with respect to the other Loan Documents or any other rights or remedies and without liability to make any other or further disbursements, regardless of Lender's previous exercise of any rights and remedies;

16.1.4. Proceed as authorized at law or in equity with respect to the Event of Default, and in connection with that, remain entitled to exercise all other rights and remedies described in this Loan Agreement or the Trust Deed; and Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 19

16.1.5. Recover its funds expended in exercis ing or enforcing any of its rights or remedies under any of the Loan Documents, together with interest at the maximum amount allowed by law from the date the funds were spent until repaid which amounts will be deemed secured by the Trust Deed.

16.2. RIGHTS CUMULATIVE, NO WAIVER. All of Lender's rights and remedies provided in this Loan Agreement or in any of the other Loan Documents are cumulative and may be exercised by Lender at any time. Lender's exercise of any right or remedy will not constitute a cure of any Event of Default unless all sums then due to Lender under the Loan Documents are repaid and Borrower has cured all other Events of Default. No waiver will be implied from Lender's failure to take, or delay in taking, any action concerning any Event of Default or from any previous waiver of any similar or unrelated Event of Default. Any waiver under any of the Loan Documents must be in writing and will be limited to its specific terms.

16.3. DISCLAIMER. Whether Lender elects to employ any of the remedies available to it in connection with an Event of Default, Lender will not be liable to construct, complete, or protect the Project; to pay any expense in connection with the exercise of any remedy; or to perform any other obligation of Borrower.

16.4. GRANT OF POWER. Subject to the prior rights of lenders whose loans are secured by the Property and senior to the rights of Lender, Borrower irrevocably appoints Lender as its attorney -in-fact, with full power and authority, including the power of substitution, exerc isable on the occurrence of an Event of Default, to act for Borrower in its name, place, and stead as provided in this Loan Agreement, to take possession of the Property and Project, remove all employees, contractors, and agents of Borrower, to complete or attempt to complete the work of construction, and to market, sell, or lease the Property and Project; to make any additions, changes, and corrections in the Plans as may be necessary or desirable, in Lender's sole discretion, or as it deems proper to comp lete the Project; to employ any contractors, subcontractors, suppliers, architects, inspectors, consultants, property managers, and other agents that Lender, in its sole discretion, deems proper fo r the completion of the Project, for the protection or clea rance of title to the Property or Personalty, or for the protection of Lender's interests, to employ security guards to protect the Property and Project from injury or damage; to pay, settle, or compromise all bills and claims then existing or later arising against Borrower that Lender, in its sole discretion, deems proper for the completion of the Project, for the protection or clearance of title to the Property, or for the protection of Lender' s interests; to prosecute and defend all actions and proceedin gs in connection with the Property or Project; and to execute, acknowledge, and deliver all other instruments and documents in the name of Borrower that are necessary or desirable, to exercise Borrower's rights under all contracts concerning the Property o r Project, and to do all other acts with respect to the Property or Project that Borrower might do on its own behalf, in each case as Lender in its reasonable discretion deems proper.

16.5. In the event a non-monetary Event of Default hereunder Lender shall give Borrower and its limited partner simultaneous written notice of such default and thirty (30) days opportunity to cure prior to exercise of remedies by the Lender hereunder, provided, however, for any Event of Default which threatens the Habitability of any dwelling or the health and/or safety of any Project occupant Lender shall give Borrower and its limited partner simultaneous written notice of such default and 48 hours to cure such default prior to exercise of remedies by Lender hereunder. In no event s hall Lender be precluded from exercising remedies by any failure to cure a default or the default is not cured.

17. BLANKET COVERAGE. Borrower’s obligation to carry insurance as required under this Loan Agreement may be satisfied by coverage under a “blanket” policy or policies of insurance (as the term is customarily used in the insurance industry); provided, however, that Lender shall nevertheless be named as an additional insured under such blanket policy or policies to the extent required by this Section, the coverage afforded Lender will not be reduced or diminished thereby, and all of the other requirements of this Section 6 with respect to such insurance shall otherwise be satisfied by such blanket policy.

18. MISCELLANEOUS.

18.1. NONRECOURSE. Subject to the provisions of this Section 18.1, and notwithstanding any provision of the Loan Documents other than this Section 18.1, the persona l liability of Borrower, and Borrower’s principals, partners, members, agents, officers, and successors in interest, to pay the principal of and interest on the debt evidenced by the Note and any other agreement evidencing Borrower's obligations under the Note shall be limited to (a) the Collateral, (b) the personal property described in and pledged under any Loan Document, and (c) the rents, profits, issues, products and income of the Property, including any received or collected by or on behalf of Borrower after an Event of Default.

18.2. CURE BY PARTY OTHER THAN BORROWER. Any lender whose loan is secured by the property and any principal or partner of Borrower, including the Investor Limited Partner, may cure a default of the Loan, provided that such Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 20
cure rights shall be the same as Borrower’s cure rights. Such other curing party must cure by the date on which Borrower was obligated to cure, except if Lender is obligated by this Loan Agreement to give separate notice to such other curing party, in which instance, the cure period shall begin when Lender makes such notice to such other curing party.

18.3. CONDEMNATION. The proceeds of any award or claim for damages, direct or consequential, in connection with any condemnation or other taking of all or any part of t he Property, or for conveyance in lieu of condemnation, are hereby assigned and shall be paid to Lender , In the event of a taking of all of the Property, the proceeds shall be applied to the sums provided by this Loan, subject to any claims of prior lienho lder, with the excess, if any, paid to junior lienholders and Borrower, as they may determine. In the event of the partial taking of the Property, unless Borrower and Lender otherwise agree in writing, and subject to any claims of prior lienholders, there shall be applied to the sums secured by the Trust Deed such proportion of the proceeds as is equal to that proportion which the amount of the sums secured by the Trust Deed immediately prior to the date of taking bears to the fair market value of the Pro perty immediately prior to the date of taking, with the balance of the proceeds paid to junior lienholders and Borrower, as they may determine.

If the condemnor offers to make an award or settle a claim for damages to the Property and: (1) the Property is abandoned by Borrower; or (2) after notice by Lender to Borrower of the condemnor’s offer, Borrower fails to respond to Lender within 30 days after the date such notice is mailed; Lender is authorized to collect and apply the proceeds, at Lender's option, either to restoration or repair of the Property or to the sums secured by the Trust Deed.

Unless Lender and Borrower otherwise agree in writing, any such application of proceeds to principal shall not extend or postpone the due date of any payment or change the amount of such payment.

18.4. SUBORDINATION. Lender may subordinate this Loan to that certain senior loan made by the Senior Lender (the “Senior Loan”), provided that the Senior Loan for the Project indicated in the Budget meets all requirements of this Loan Agreement, and that such Senior Loan does not require modification of this Loan Agreement . Notwithstanding anything to the contrary contained in the Loan Documents, if Borrower refinances the Senior Loan with prior written consent from Lender (the “Refinance Loan”), then Lender hereby agrees to negotiate in good faith with the maker of the Refinance Loan regarding subordination of the Loan or the standstill of certain remedies provided therein, provided that the amount of the Refinance Loan does not exceed the then outstanding principal balance of the Senior Loan plus the reasonable costs of refinancing .

18.5. FUNDING REQUIREMENTS. If any Loan Program is federally funded, Borrower shall comply with all laws, rules, regulations and funding requirements t hat govern the use of such funds. Lender, to the extent required by law, shall cooperate with and assist Borrower in fulfillment of such obligations. If Lender, as a result of actions of Borrower, shall be obligated to repay the Loan Program any amount o f the Loan Proceeds, Borrower shall make such repayment on account of Lender and failure to do so shall be an Event of Default.

18.6. NATURE OF REPRESENTATIONS AND WARRANTIES. Borrower certifies to Lender that all representations and warranties made in this Loan Agreement and all other Loan Documents are true and correct in all material respects and do not contain any untrue statement of a material fact or omit any material fact necessary to make the representations and warranties not misleading. All represe ntations and warranties will remain true and correct in all material respects and will survive so long as any of Borrower's obligations have not been satisfied or the Loan or any part of it remains outstanding, and for any applicable statute of limitations period. Each request by Borrower for a disbursement will constitute an affirmation that all representations and warranties remain true and correct as of the date of that request. Each representat ion and warranty made in this Loan Agreement, in any other Loan Documents, and in any other document delivered to Lender by Borrower will be deemed to have been relied on by Lender, regardless of any investigation, inspection, or inquiry made by Lender or any related disbursement made by Lender. The representati ons and warranties that are made to the best knowledge of Borrower have been made after diligent inquiry calculated to ascertain the truth and accuracy of the subject matter of each representation and warranty.

18.7. NO WAIVER. No failure or delay on the part of Lender in exercising any right or remedy under the Loan Documents will operate as a waiver nor will Lender be estopped to exercise any right or remedy at any future time because of any such failure or delay. No express waiver will affect any matter other than the matter expressly waived and that waiver will be operative only for the time and to the extent stated. Waivers of any covenant, term, or condition in this Loan Agreement will not be construed to waive any subsequent breach of the same covenant, term, or condition.

18.8. NO THIRD PARTIES BENEFITED. This Loan Agreement is made and entered into for the sole protection and benefit of the parties and their permitted successors and assigns, and no other Person will have any right of action or any rights to funds at any time on deposit in any construction account or impound account, if established , Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 21

18.9. NO JOINT VENTURE, PARTNERSHIP, OR OTHER RELATIONSHIP. Nothing contained in this Loan Agreement or in any other document executed in connection with this Loan Agreement shall be construed as creating a joint venture or partnership between Lender and Borrower. Each Party is acting as an independent entity and not as an agent of the other in any respect. No relationship exists as between Lender and Borrower other than that of a lender and a borrower.

18.10. NOTICES. Borrower irrevocably appoints Lender as its agent (the agency being coupled with an interest) to file for record any notices of compl etion, cessation of labor, or any other notice that Lender deems necessary or desirable to protect its interests under this Loan Agreement or under the Loan Documents. All notices to be given under this Loan Agreement shall be in writing and sent to the a ddresses stated above for the respective recipient by one or more of the following methods.

18.10.1. Certified mail, return receipt requested, in which case notice shall be deemed delivered three (3) business days after deposit, postage prepaid in the United States Mail;

18.10.2. A nationally recognized overnight courier, by priority overnight service, in which case notice shall be deemed delivered one (1) business day after deposit with that courier;

18.10.3. Hand delivery with signed receipt for delivery from a person at the pl ace of business of the receiving party and authorized to accept delivery for the receiving party, in which case notice shall be deemed delivered upon receipt, or

18.10.4. Telecopy, if a copy of the notice is also sent the same day by United States Certified Mail, in which case notice shall be deemed delivered one (1) business day after transmittal by telecopier, provided that a transmission report is automatically generated by the telecopier reflecting the accurate transmission of the notices to receiving party at the “Fax Number” given in the Escrow Attachment or to such other address as Borrower or Lender may respectively designate by written notice to the other.

A copy of any notice sent to Borrower shall be sent to the Investor Limited Partner at the following address:

Wells Fargo Affordable Housing Corp.
550 S. Tryon Street
23rd Floor, D1086-239
Charlotte, NC 28202-4200
Attention: Director of Tax Credit Asset Management

18.11. SHORT TERM NOTICES. Notices, including requests for approval, requiring action in less than thirty (30) days may only be given by the foregoing overnight courier or hand delivery method, and shall include the following language on its face: “URGENT – TIME SENSITIVE – IMMEDIATE ACTION REQUIRED” and marked for delivery to Portfolio Management. Such notice shall include the time allowed under this Loan Agreement for action.

18.12. ACTIONS. Lender will have the right to commence, appear in, or d efend any action or proceeding purporting to affect the rights, duties, or liabilities of the parties, or the disbursement of any funds under this Loan Agreement.

In connection with that, Lender may incur and pay costs and expenses, including, without lim itation, reasonable attorney fees. Borrower agrees to pay to Lender on demand all these expenses, and if applicable, Lender is authorized to disburse funds from the construction account for that purpose. This Section does not apply to actions or proceedi ngs between the parties.

18.13. SIGNS. Borrower agrees that on the request of Lender, Borrower will erect and place on or in the immediate vicinity of the Property a sign indicating that Lender has provided construction financing for the Project, which sign shal l remain for the duration of construction. If Borrower places a sign on the Property during construction stating the names of the Project participants, it shall also name “Sacramento Housing and Redevelopment Agency” as a participant in the Project.

Lender’s name on the sign shall be in letters not less than size of letters used to name any of the other participants.

18.14. ASSIGNMENT. The terms of this Loan Agreement will be binding on and inure to the benefit of successors and assigns of the parties. However, Borrower shall not assign this Loan Agreement or any interest it may have in the monies Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 22
due or, except as otherwise provided, convey or encumber the Property without the prior written consent of Lender to a party other than a general partner or managing member of Borrower or a single asset entity wholly owned and controlled by Borrower or a general partner or managing member of Borrower. However, if there is an assignment, conveyance, or encumbrance, Lender may nevertheless at its option continue to make disbursements under this Loan Agreement to Borrower or to those who succeed to Borrower's title, and all sums so disbursed will be deemed to be disbursements under this Loan Agreement and not modifications, and will be secured by the Security Documents. Lender may at any time assign the Loan Documents to any affiliate of Lender or to a national bank or other lender having experience with construction lending, and the assignee will assume the obligations of Lender, and Lender will have no further obligati on of any nature. In that case, the provisions of this Loan Agreement will continue to apply to the Loan, and the assignee will be substituted in the place and stead of Lender, with all rights, obligations, and remedies of Lender, including, without limit ation, the right to further assign the Loan Documents. In addition, Lender may at any time assign a participation in the Loan to any other party, provided that Lender continues to be primarily obligated under this Loan Agreement.

18.15. PREPAYMENT. Borrower may prepay the Loan only on and subject to the terms and conditions in the Note.

Borrower shall have no rights to receive, and under no circumstances will Borrower receive repayment of any fees previously paid to Lender.

18.16. CONTROLLING LAW; VENUE. The Loan Do cuments will be governed by and construed in accordance with California law. The venue for any legal action or proceeding will be in the County of Sacramento, California.

18.17. CONSENTS AND APPROVALS. All consents and approvals by Lender required or permitted by any provision of this Loan Agreement will be in writing. Lender's consent to or approval of any act by Borrower requiring further consent or approval will not be deemed to waive or render unnecessary the consent or approval to or of any subsequent sim ilar act.

18.18. SURVIVAL OF WARRANTIES AND COVENANTS. The warranties, representations, conditions, covenants, and agreements in this Loan Agreement and in the other Loan Documents will survive the making of the Loan and the execution and delivery of the Note and will continue in full force until the Loan has been paid in full. Nothing in this Section is intended to limit any other provision of the Loan Documents that by their stated terms survive the repayment of the Loan or the termination of any Loan Document.

18.19. RECORDING AND FILING. Borrower, at its expense, will cause the Security Documents and all supplements to be recorded and filed and re-recorded and re-filed in any manner and in any places as Lender will reasonably request, and will pay all recording, filing, re-recording, and re-filing taxes, fees, and other charges.

18.20. LOAN EXPENSES. In making the first disbursement, Lender may, at its option, deduct from the proceeds of that disbursement a sum equal to the aggregate of the following, to the extent Lender has knowledge of it and demand has been made on Lender at the time of the deposit: all expenses specifically incurred in connection with the Loan or the preparation, execution, and delivery of the Loan Documents, including, but not limited to, reco rding costs and expenses, transfer and other taxes (if any), surveys, appraisal fees, title and hazard insurance premiums, recording, notary, and escro w charges, and all other similar, usual, or customary loan closing charges and expenses; and any other bu dgeted expenses that have been approved by Lender in writing; and Lender will, for the benefit of Borrower, pay those amounts over to the respective parties on whose behalf the demands will have been received by Lender. Borrower will pay directly any expenses in connection with the Loan not so paid by Lender, including, without limitation, any of the expenses specified above, and will hold Lender free from any cost, liability, or obligation of any nature in connection with it, including reasonable attorney fees incurred by Lender. Borrower further agrees to pay on demand all out-of-pocket costs and expenses reasonably incurred by Lender including, without limitation, the fees and disbursements of Lender's outside counsel, in connection with: (i) the administration of the Loan, including, without limitation, all approvals or consents given or contemplated to be given under the Loan Documents, all amendments to the Loan Documents entered into by Lender or requested by any party to the Loan Documents, and all title insurance policies and endorsements required by Lender, and (ii) the enforcement of any rights or remedies under the Loan Documents, whether any action or proceeding is commenced, or the protection of the security, or interests of Lender under the Loan Documents. All costs and expenses, together with interest at Interest Rate, will form a part of the indebtedness and will be secured by the Security Documents.

18.21. NO REPRESENTATIONS BY LENDER. By accepting or approving anything required to be observed, performed, or fulfilled, or to be given to Lender pursuant to this Loan Agreement or pursuant to the Loan Documents, including, but not limited to, any officer's certificate, balance sheet, statement of income and expense, or other Financial Statement, survey, appraisal, or insurance policy, Lender will not be deemed to have warranted or represented the sufficiency, legality, effectiveness, or legal effect of it or of any particular term, provision, or condition of it, and any acceptance o r Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 23
approval will not be or constitute any warranty or representation by Lender.

18.22. AMENDMENT. The Loan Documents and the terms of each of them may not be modified, waived, discharged, or terminated except by a written instrument signed by the party against whom enforcement of the modification, waiver, discharge, or termination is asserted.

18.23. TERMINATION. Except as otherwise provided in the Loan Documents, all rights and obligations under this Loan Agreement will terminate except as to any accrued obligations effective on the payment of all Loan owing by Borrower to Lender.

18.24. COUNTERPARTS. The Loan Documents may be executed in any number of counterparts and by different parties in separate counterparts, each of which when executed and delivered will be deemed an original and all of which counterparts taken together will constitute one and the same instrument.

18.25. SEVERABILITY. If any term, provision, covenant, or condition or any application is held by a court of competent jurisdiction to be invalid, void, or unenforceable, all term s, provisions, covenants, and conditions and all applications not held invalid, void, or unenforceable will continue in full force and will in no way be affected, impaired, o r invalidated.

18.26. CAPTIONS. All Article and Section headings in the Loan Documents are inserted for convenience of reference only and do not constitute a part of the Loan Documents for any other purpose.

18.27. INDEMNITY. Borrower agrees to defend, indemnify, and hold Lender harmless from all losses, damages, liabilities, claims, actions, jud gments, costs, and reasonable attorney fees that Lender may reasonably incur as a direct or indirect consequence of the making of the Loan, Borrower's failure to perform any obligations as and when required by this Loan Agreement or any of the other Loan D ocuments, the failure at any time of any of Borrower's representations or warranties to be true and correct, or any act or omission by Borrower, any contractor, subcontractor, engineer, architect, or other Person with respect to the Property, the Project, or any portion of them except to the extent caused by the gross negligence or willful misconduct of Lender. Borrower will pay immediately on Lender's demand any amounts owing under this indemnity, together with interest at the maximum rate permitted by law from the date Lender makes a payment or incurs a loss. Borrower's duty to indemnify Lender will survive the release and cancellation of the Note and the reconveyance or partial reconveyance of the Trust Deed.

18.28. FURTHER ASSURANCES. At Lender's request an d at Borrower's expense, Borrower will execute, acknowledge, and deliver all other instruments and perform all other acts necessary, desirable, or proper to carry out the purposes of the Loan Documents or to perfect and preserve any liens created by the Lo an Documents.

18.29. DISCLOSURE OF INFORMATION. If Lender elects to sell the Loan, Lender may forward to the buyer of the Loan all documents and information related to the Loan in Lender's possession, including without limitation all Financial Statements, whether furnished by Borrower or otherwise.

18.30. LENDER'S AGENTS. Lender may designate agents or independent contractors to exercise any of Lender's rights under the Loan Documents. Any reference to Lender in any of the Loan Documents will include Lender's employees, agents, and independent contractors.

18.31. INTEGRATION AND INTERPRETATION. The Loan Documents contain or expressly incorporate by reference the entire agreement between Lender and Borrower with respect to the covered matters and supersede all prior negoti ations.

Any reference to the Property or Project in any of the Loan Documents will include all or any portion of them. Any reference to the Loan Documents themselves in any of the Loan Documents will include all amendments, renewals, or extensions approved by Lender.

18.32. NUMBER, IDENTITY AND GENDER. When the context and construction so require, all words used in the singular will be deemed to have been used in the plural and vice versa. When the context and construction so require, all words which indicate a gender will be deemed to have been used to indicate the gender as indicated by the context.

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 24

THE PARTIES HAVE EXECUTED THIS LOAN AGREEMENT in Sacramento, California as of the Effective Date.

BORROWER:

BROADWAY STATION, L.P, a California limited partnership

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Attachment 6 Exhibit A
Construction and Permanent Loan Agreement Page 25
THE PARTIES HAVE EXECUTED THIS LOAN AGREEMENT in Sacramento, California as of the Effective Date.

LENDER:

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY,

A JOINT POWERS AUTHORITY

By: _______________________________________
La Shelle Dozier, Executive Director

Approved as to form:

___________________________________________
Lender Counsel

Construction and Permanent Loan Agreement Page 26

Exhibit 1: Legal Description

The land referred to in this Report is situated in the County of Sacramento, City of Sacramento, State of California, and is described as follows:

PARCEL ONE:

LOTS 1, 2, 7 AND 8, IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF.

PARCEL TWO:

ALL THAT PORTION OF THAT CERTAIN ALLEY IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF, PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING AT THE SOUTHWESTERLY CORNER OF LOT 1 OF SAID BLOCK, SAID CORNER BEING AT THE INTERSECTION OF THE EASTERLY LINE OF 19TH STREET AND THE NORTHEASTERLY LINE OF SAID ALLEY; THENCE SOUTHEASTERLY 151 FEET, ALONG THE SOUTHWESTERLY LINE OF SAID LOT AND LOT 2 OF SAID BLOCK; THENCE SOUTHERLY IN A DIRECT LINE ACROSS SAID ALLEY TO THE NORTHEASTERLY CORNER OF LOT 7 OF SAID BLOCK, SAID CORNER BEING LOCATED ON THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; THENCE NORTHWESTERLY 160 FEET, ALONG THE NORTHEASTERLY LINE OF SAID LOTS 7 AND 8, IN SAID BLOCK, AND THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; TO THE NORTHWESTERLY CORNER OF SAID LOT 8, LOCATED ON THE EASTERLY BOUNDARY LINE OF SAID 19TH STREET; THENCE NORTHEASTERLY 20 FEET ALONG SAID EASTERL Y BOUNDARY LINE OF 19TH STREET, TO THE POINT OF BEGINNING.

APN: 010-0213-008

Construction and Permanent Loan Agreement Page 27
Exhibit 2: Scope of Development
On Broadway Apartments is a new construction development on approximately 1.25 acres located along the Broadway corridor in Sacramento. The development consists of 140 units comprised of 68 one-bedroom with one-bathroom, 36 two- bedroom with one-bathroom, and 36 three-bedroom with two-bathroom units. Inclusive of this unit mix, 2 units will be exempt for management staff. The common areas and amenities include laundry room, long term and short-term bike storage, conference room, community room with kitchen, support services office on site and an outdoor courtyard.

All work shall comply with Federal and State Americans with Disability Act (ADA) accessibility requirements, as well as any other requirements stipulated by the funding sources. When there are differences, the stricter shall prevail. The Borrower is responsible for notifying their architect and/or engineer of all funding sources used on t he Project. The architect and/or engineer must indicate these funding requirements in the Project’s plans/scope of work.

I. Mitigation Measures:

Reserved - TBD.

II. Mitigation Monitoring Plan:

Reserved - TBD.

III. Building Exteriors:

1. Asphalt Pavements: The development will include 60 onsite surface parking spaces. There will be three (3) ADA parking spaces. The parking lot and drive aisles will include two pedestrian crosswalks using standard striping.

2. Balconies and Patios: The Project will not have any balconies or patios.

3. Site Lighting: The site will be lit with Title 24 compliant building mounted lighting, decorative pole lights and other luminaires for all parking and outside public spaces and will be of LED or similarly energy efficient type.

4. Non-Smoking: The Project is 100% non-smoking. Consideration might be given to a smoking area over 100ft from the building given that needs of the NPLH population at the project.

5. Landscaping and Courtyard: Landscaping is designed with drought tolerant plants and trees. Trees will be planted throughout the parking lot to meet City shading requirements. The L-shaped buildings has a center open- air landscaped courtyard with hardscaped picnic area and two children’s play area. Borrower’s Landscape Plan dated was included with plans submitted for entitlements.

6. Picnic Area: One Barbeques and seating areas will be provided.

7. Play Area: The play area will have one (1) school age and one (1) toddler-appropriate play structures.

8. Site Fencing: The rolling up auto entry gate for the site is on X Street and is set back from the street to allow for vehicular turn around. The site will be gated and remain closed at all times. Residents and employees of the complex will have remote access to open the gate and park inside. There is a 60 foot long loading zone on X Street as a pull in lane for rideshare and other drop -offs. Pedestrian access to the site is through the building lobby and pedestrian gates along the 19th Street, Broadway and X Street from the sidewalk. Perimeter site fencing will be decorative metal screen and metal louver panels.

9. Stormwater: The development is exempt from C3 storm water requirements as the sire is served by the City’s combined sewer and storm system.

10. Roof: Buildings are planned with flat roofs and parapets in order to provide a platform for solar hot water panels, PV panels, and mechanical equipment. The material on the roof will be white Thermoplastic Polyolefin (TPO) planned to passively counteract the warm conditions of Sacramento County.

Construction and Permanent Loan Agreement Page 28

11. Exterior Materials: The building skin will be painted stucco at the upper floors and exposed concrete podium at the ground floor. Accent elements are mosaic tiles at the upper floors to add color and texture opportunities as well as a metal banding separating the ground floor and the residential units above.

12. Offsite Improvements: Public offsite improvements consist of street frontage improvements along Broadway, X Street and 19th Street, including new sidewalks, curbs, gutters, landscaping, and lighting.

IV. Building Interiors

1. Americans with Disabilities Act (ADA) Units: There will be sixteen (21) units, 15% of the units, accessible with mobility features.

2. Non-Smoking: The Project will have 100% non-smoking units.

3. Smoke Detectors: All units, offices and interior common areas will have a smoke/carbon monoxide d etector installed in accordance with current code requirements.

4. Appliances: All apartment kitchens will have brand new Energy Star rated appliances including, refrigerator with freezer combination, electric stove and range, dishwasher and garbage disposal.

5. Bathtubs and Toilets: All apartments will have a bathtub/shower. Restrooms will have water efficient toilet and fixtures, and bath accessories.

6. Doors (Interior, Exterior): All interior and exterior doors will have matching hardware finishes. All exterior doors will have deadbolt locks, keyed latch assemblies, viewers, and screws in strike plates long enough to penetrate the door jamb framing by at least one inch. The dwelling entry door hardware shall have single action hardware to release deadbolt and latch assembly. All doors will meet current egress standards.

7. Cabinets, Counters and Sinks: All apartment kitchens will have modular all plywood construction cabinets, solid surface countertops, and stainless-steel sink. Microwave shelving will be provided (except in ADA units) either above the counter, or on the pantry shelving with electrical outlet for microwave, All apartment bathrooms will have all wood vanity, and solid surface countertops with integral sink. All cabinetry face frames, doors and drawer faces will be High Density Plastic Laminate (HDPL).

8. Ceilings and Walls: Low or no VOC paint will be used in building interiors.

9. Windows: All apartments will have energy efficient vinyl dual pane windows. Windows designed to open will have screens. All windows will meet current egress standards.

10. Blinds: Vertical blinds will be provided in all apartment windows.

11. Electrical and Lighting: All apartments will have high efficiency lighting, exhaust fans vented to the exterior and bathroom humidistat fans. Central air conditioning and forced air heat will be provided. Any exterior mounted electrical, mechanical and plumbing systems will be protected from vandalism. Wiring from telephone/data/cable suppliers will be installed within walls, attic spaces, and/or crawl spaces. Conduits are not allowed to be mounted on the exterior of the buildings.

12. Flooring: Apartment interiors will have luxury vinyl plank (LVP) flooring throughout

13. Plumbing Fixtures: All apartments will have new water efficient plumbing fixtures.

V. Community Amenities

1. Management Office and Lobby: The furnished management office and lobby will have resilient flooring, energy efficient lighting and HVAC systems.

2. Ceilings and Walls: Low or no VOC paint will be used in all building interiors.

Construction and Permanent Loan Agreement Page 29

3. Community Restrooms: The two community restrooms per building on the first floor will be ADA compliant, have low-flow bathroom fixtures, sink, solid surface countertop, and bathroom accessories. Bathroom walls will have glazed wall tile to 48 inches high.

4. Community Room located on the 1st Floor: The community room, computer room, and conference rooms will have resilient flooring, energy efficient lighting, all furnishings and HVAC systems. There are two community rooms totaling 2,251 square feet, and two conference rooms 722 square feet. These spaces will be ADA compliant.

5. Community Room Kitchen: The community room kitchen will be ADA compliant and include all plywood construction cabinets with solid hardwood faces, solid surface countertop, and stained concrete New Energy Star rated appliances (refrigerator, electric stove, electric oven, microwave, garbage disposal and dishwasher), energy efficient lighting, HVAC system and water efficient plumbing fixtures will be installed.

6. Elevator: Four hydraulic elevator will be installed. The elevator floor surface area will be a minimum of 28 square feet.

7. Hallways and Stairs: Enclosed stairs will have non-slip concrete treads, landings and closed risers. The first floor hallways will be resilient flooring. All residential hallway floorings will be carpet.

8. HVAC & Plumbing Systems: Each apartment will have its own split system air conditioning and forced air heat with its own thermostat. Residential hallways will have air conditioning. Stairwells will not have heating or air conditioning. A gas-fired central boiler augmented by solar thermal panels will provide hot water for the development. Bathroom exhaust fans will be humidistat controlled.

9. Laundry Facility: The 400 square foot laundry room accommodates seven (7) washers and seven (7) dryers, which will include one set of ADA accessible laundry machines. There are two laundry rooms, one per building for a total of 14 washers/dryers for the project.

10. Signage: A comprehensive signage package will be implemented throughout the development including all common area signage, unit ID, wayfinding, code, fire, life and safety signage.

11. Trash Room: One trash chute and one recycle chute will be located on each floor. A trash and recycle receiving room is located on the ground floor within the building envelope. A trash staging area is located along X Street for trash pick up.

12. Recycle: One recycle chute will be located on each floor, emptying into the ground floor trash and recycle room.

13. Bicycle parking: A minimum of one hundred thirty-five (135) long-term and twenty two (22) short-term bicycle parking will be provided. Long-term bicycle parking will be provided within the building on the ground floor, and short-term bicycle parking will be provided on the exterior of the building.

14. Security Cameras: there will be interior and exterior web-based security cameras; the equipment will record events for primary ingress/egress points to and from the site, parking lots and indoor and outdoor common areas where people will be congregating.

Attachment 1: Lender’s Minimum Construction Standards (MCS) exhibit is on the following page.

Construction and Permanent Loan Agreement Page 30
Attachment 1

RENTAL PROPERTY MINIMUM CONSTRUCTION STANDARDS

The following is a list of the required minimum construction standards that must be incorporated into projects participating in SHRA’s Multifamily Financing and/or Mortgage Revenue Bond programs. All rental units and sites associated with these projects must meet or exceed these standards. Exceptions to these standards may be made for properties subject to U.S. Department of Housing and Urban Development replacement reserve requirements that allow for renovation over time rather than at recapitalization (e.g., Rental Assistance Demonstration conversions for conventional public housing).

Note: For rehabilitation projects, all of the following standards shall apply. The non-rehabilitation sections below shall apply to new construction projects.

Useful Life Expectancy – Rehabilitation only

SHRA shall reference the current edition of FannieMae’s “Instructions for Performing a Multifamily Property Condition Assessment, Appendix F. Estimated Useful Life Tables” in determining the useful life for all building components and systems located within the project. A remaining useful life of 15 years or more is required for all building components and systems located within the approved complex. All items on the FannieMae tables with useful lives indicated to be less than 15 years shall be replaced.

General Requirements

A. All materials funded under this loan must be new unless previously approved. Recycled items must be approved in writing by SHRA prior to their use.

B. All work shall comply with Federal and State ADA accessibility requirements, as well as any other requirements stipulated by the funding source(s). When there are differences the stricter of the two shall apply. The dev eloper is responsible for notifying their architect and/or engineer of all funding sources used on the project. The architect and/or engineer must indicate these funding requirements in the project’s plans/scope.

C. All units shall be approved for occupancy by the local Building Department or any other Agency Having Jurisdiction (AHJ) at the conclusion of the work and prior to occupancy.

D. Web-based security cameras and the equipment to record events are required for primary ingress/egress points to and from the site and for the principal parking and indoor and outdoor common areas where people will be congregating.

E. Site lighting is required for all parking and outside public spaces, and shall be of LED or similarly energy efficient type. The lenses on the exterior lights shall be cleaned with all oxidation removed or replaced. Light poles shall be new or painted, and shall be structurally sound and stable.

F. The developer’s architect is responsible for providing an Operating Procedure Outline Sheet (OPOS) for window washing systems where applicable, per Cal-OSHA requirements.

G. SHRA encourages the use of energy and water-efficient systems wherever they may be incorporated into the project.

General Requirements – Rehabilitation only

A. Any component of the project which does or may present a health or safety hazard to the public or tenants shall be corrected to the satisfaction of the local Building Department or AHJ.

B. A clear pest inspection report will be required at the conclusion of the construction work for rehabilitation projects.

C. For all structures where disturbance of any hazardous materials (e.g. lead, asbestos, mold, etc.) will occur, a clearance report from an environmental consultant is required.

D. Projects deemed historically significant landmark by either the City of Sacramento or the National Register of Historic Places shall consult with the State Historic Preservation Officer (SHPO), and shall conform to the Secretary of the Interior Standards for the Treatment of Historic Properties.

Construction and Permanent Loan Agreement Page 31
Site Work

A. Trees and large shrubs must be trimmed, grass areas must be mowed, and all planter areas must be weed -free. The landscape design shall incorporate a sustainable design appropriate for the Sacramento Valley. Vegetation that assists in minimizing crime and enhances public safety is preferred. Trees compromising building envelope materials (roofing, siding, windows, etc.) and/or structural integrity (including foundations) must be removed. An arborist shall be consulted for an opinion on trees prior to major branch trimming, root cutting or tree removal. All trees, bushes and other plants that are to be removed shall have the root ball removed by grinding or by mechanical means. A landscape plan describing the above must be provided to SHRA for approval.

B. All landscaped areas must be served by a programmable automated irrigation system. The irrigation controller shall be a “Smart Controller” that senses rain to reduce water use. Irrigation shall be designed to use bubblers and other water saving measures. Irrigation must not spray on building. Sprinklers should minimize overspray that runs to storm drain drop inlets. Areas that show evidence of erosion of soil shall be landscaped to eliminate problems. The landscape plan must be approved by SHRA and applied.

C. For gated communities containing swinging vehicle gates, driveways shall be striped to show the area under the gate swings for safety purposes.

D. All projects shall contain trash enclosures with concrete aprons. Trash enclosures shall be made of cinder blo ck or stucco. Trash enclosures shall be accessible to all tenants. Provisions for tenants with disabilities must be addressed in the project Scope of Development or the project plans.

E. All projects shall meet the parking requirements of the local Agency Having Jurisdiction (AHJ) over the project. "Grandfathered Projects" will need to show that they are in fact “Grandfathered” or otherwise exempted by the local AHJ. Otherwise, all projects shall meet the governing ADA requirements for parking.

F. A two percent (2%) slope shall be maintained for a distance of five feet from all structures and no standing water shall remain on the site. Provide an on- site drainage system if necessary.

G. Stairways in common areas must include closed risers and non-slip concrete finish or other slip-resistant material on the treads.

H. Exterior mounted electrical, mechanical, and plumbing systems must be protected from vandalism.

I. For family projects of 50 or more units, a minimum of one school age-appropriate play structure is required. For family projects of 100 or more units, a minimum of one school age and one toddler -appropriate play structure is required.

Site Work – Rehabilitation only

A. All landscaping and irrigation systems must be in a well-maintained condition.

B. All fencing must be in good and serviceable condition. Existing fencing that is to remain shall be free of flaking paint, rust, or any other signs of failure. If existing fencing shows any signs of failure, it shall be repaired, painted and restored to look new. All chain link fencing must be removed and replaced with fencing of another approved material.

All pedestrian gates hardware must be functional and in new or near -new condition. Access Control systems are required at exterior pedestrian gates.

C. All driveways and sidewalks must be in good condition. All cracked or uplifted areas (more than ¼”) shall be repaired or replaced.

D. The asphalt shall be in good condition, with no alligator cracking, longitudinal cracking, potholes, or standing water.

Repairs to portions of parking lots not suitable for new coatings shall be performed by removing and replacing damaged paving. A new seal-coat or slurry-coat shall then be applied to the entire parking lot surface. Parking spaces shall be restriped, including ADA aisles and other applicable striping/painting.

E. All site accessories (bollards, benches, tables, play equipment, bike racks, mailboxes, shade structures, BBQs, sheds, etc.) shall be replaced or in good repair (cleaned, painted and/or re -coated).

Construction and Permanent Loan Agreement Page 32
Building Envelope and Moisture Protection – Rehabilitation only

A. All areas exposed to moisture must be sealed and watertight. Buildings showing evidence of water intrusion shall have the areas inspected by a licensed architect/engineer or by a certified water intrusion expert. A water intrusion report shall be submitted to SHRA, and shall include the cause of the issue and a resolution to eradicate the water intrusion. If the inspection cannot be completed until the demolition phase of the project, the report shall desc ribe a procedure to inspect the issue during demolition.

B. Roofing must have 15 years or more of remaining life with no visible signs of leakage. For roofs containing composition shingles, a maximum of two layers of shingles are allowed (including any propo sed new layers). Provide evidence that the roof system has a 15-year life remaining on the manufacturer’s warranty.

C. All siding must have 15 years or more of remaining life. Hairline cracks in stucco must be sealed and painted with elastomeric paint. If requested by SHRA, a statement by a licensed architect and/or engineer that the existing siding contains at least 15 years of useful life remaining shall be provided.

D. Fireplaces must be clean and meet applicable air quality standards. Chimneys shall be clean and must be inspected by a certified chimney inspector for structural integrity. All recommended structural repair s shall be performed.

Doors and Windows

A. All dwelling/tenant units must have screens on all windows that are designed to open. Windows designed to open must have functional locks and must operate freely without excessive effort. All windows must be dual -paned (minimum), and shall meet or exceed the State of California’s currently applicable efficiency standards, and any other efficiency standards that may be dictated by the funding source or other governing bodies for the project.

B. All doors must have matching hardware finishes.

C. All exterior doors must have deadbolt locks, keyed latch assemblies, viewers, and screws in strike plates long enough to penetrate the door jamb framing by at least one inch. The dwelling entry door hardware shall have single act ion hardware to release deadbolt and latch assembly.

D. All sliding exterior doors shall have screen doors and shall have functional locks and must operate freely without excessive effort.

E. All doors and windows must meet current egress standards.

Doors and Windows – Rehabilitation only

A. Any windows showing signs of condensation or leakage of any kind shall be replaced. SHRA allows window replacement using retrofit windows when those windows are installed by trained professionals following manufacturer’s specifications. Retrofit windows must have a similar useful life as “new, construction” (i.e., nail fin) windows.

B. All doors and doorjambs must be in good condition. No damaged or worn doorjambs or doors are allowed. Doors and/or jambs beyond their useful life shall be replaced.

Casework

A. New cabinet boxes shall be made of plywood or solid wood. No particle board boxes will be allowed.

B. All counter tops shall be of solid surface or granite, and in very good condition with no significant scratches, burns or other imperfections.

C. Face frames, doors and drawer faces shall be solid hardwood. No plastic laminate finishes will be allowed.

Casework – Rehabilitation only

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A. All cabinets shall be replaced or in very good condition, within their 15-year useful life, both structurally and in appearance.

Finishes

A. All dwelling unit kitchens shall contain luxury vinyl plank (LVP) flooring. Bathrooms must be floored with LVP, sheet vinyl or ceramic tile to provide a cleanable, impervious surface. Bedrooms, hallways, and living and dining rooms may be floored with carpeting, LVP or hardwood. Wear layer of LVP shall be at least 12 mils inside dwelling units. Tenant unit entries shall be floored with LVP or ceramic tile.

In common areas, corridors may be floored with LVP, glue-down carpeting, or carpet tiles. Community rooms and kitchens shall be floored with LVP. Wear layer of LVP in common/commercial areas shall be a minimum of 20 mils thick.

Carpet shall meet or exceed the minimum standards as set by HUD’s UM-44D bulletin.

Finishes – Rehabilitation only

A. Floor coverings must be in good, useable condition - no holes, tears, rips, or stains.

B. All exterior and interior surfaces must be painted. No peeling, cracking, chipping, or otherwise failing paint will be allowed. All painted surfaces must be new, or in near new condition and appearance.

C. Acoustic (popcorn) ceiling texture must be removed and refinished with new texture to match wall texture.

Equipment

A. Dishwashers, refrigerator/freezer, oven, stoves and garbage disposals are required in all dwelling unit kitchens. All appliances must be new or in very good operating condition. All appliances must be Energy Star rated, as applicable.

Appliances slated for ADA units shall be per code requirements.

B. SRO projects are encouraged to provide the appliances listed above and will be reviewed and approved on a case -by- case basis.

C. All kitchens must have adequate cabinet and counter space. Installation of shelving for microwaves is required if over - the-range microwaves are not used, with the exception of ADA units.

Furnishings

A. Dwelling units must have window coverings on all windows.

Special Construction

A. Non-habitable structures on property must be painted to match primary buildings and must be structurally s ound.

B. Laundry facilities must, at a minimum, be consistent with CTCAC requirements of one washer and dryer for every ten dwelling units for family housing and one for every 15 units for senior and special needs projects. Ten percent of the total number of washer/dryers must be ADA-accessible machines (unless the ADA units contain their own laundry facilities). Solid surface countertops will be required within laundry rooms and countertops shall meet all ADA requirements.

C. Public pool areas shall have self-closing gate(s). Fences and gates at pool areas shall meet applicable current codes and standards. Joints between coping and concrete deck shall be appropriately caulked. Existing pools shall have no cracks in plaster or tile grout joints. The Developer is responsible for ensuring pool and surroundings meet all applicable current codes and standards. If a project contains two or more pools, at least one must remain following rehabilitation.

Mechanical/Plumbing

Construction and Permanent Loan Agreement Page 34
A. Water heaters must be installed per current applicable codes.

B. All common areas and tenant units must have heating and air conditioning. Wall mount (i.e. PTAC units) or central systems are acceptable. Evaporative coolers are not acceptable. HVAC units should be protected from vandalism, pursuant to discretion of SHRA.

C. Toilets, showerheads, faucets, and mixing valves shall be new and meet current water conservation codes.

D. Tub surrounds must be one unbroken piece per wall and must be of solid surfaces (such as “Swanstone” or other solid acrylic materials, quartz composites), or other similar materials. Fiberglass/acrylic surrounds are acceptable.

Mechanical/Plumbing – Rehabilitation only

A. All toilets, sinks, and tubs shall be chip and stain free.

Electrical

A. All units must have smoke/carbon monoxide detectors installed per current code.

B. Wiring from telephone/data/cable suppliers shall be installed within walls, attic spaces, and/or crawl spaces. No conduits are allowed to be mounted on the exterior of the buildings in new construction.

C. Broadband infrastructure meeting the requirements of 24 CFR 5.100* is required in all new construction projects of 4 or more units.

*Broadband infrastructure means cables, fiber optics, wiring, or other permanent (integral to the structure) infrastructure, including wireless infrastructure, that is capable of providing access to Internet connections in individual housing units, and that meets the definition of “advanced telecommunications capability” determined by the Feder al Communications Commission under section 706 of the Telecommunications Act of 1996 (47 U.S.C. 1302).

Electrical – Rehabilitation only

A. All electrical panels shall meet current code.

B. Any rehabilitation projects with un-grounded electrical systems shall be re-wired with grounded systems to meet current code.

C. For rehabilitation projects, switches, outlets and light fixtures shall be replaced with devices that meet current applicable codes.

D. Wiring mounted on the exterior of the surface may be allowed if it is concealed in conduit and conduit is painted to match exterior siding. For projects where exterior siding will be removed, this wiring shall be installed within walls, attic spaces, and/or crawl spaces.

Resident Services Community Space

All properties, regardless of project type (i.e. senior, family, or large family), must devote a minimum of 1,200 s.f. to act ual resident services/community space. Resident services space includes common kitchens, computer rooms, meeting rooms and general gathering space. It does not include public restrooms, leasing offices, laundry facilities and lobbies. Common kitchens are required, including refrigerator, stove, garbage disposal, and dishwasher.

For existing buildings, these requirements shall apply unless SHRA deems there to be significant physical constraints.

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Exhibit 3: Note Form

PROMISSORY NOTE
FOR ON BROADWAY STATION, L.P.

CONSTRUCTION AND PERMANENT LOAN AGREEMENT

BORROWER HAS MADE THIS PROMISSORY NOTE (“NOTE”) AS OF THE EFFECTIVE DATE. The Lender is making the Loan pursuant to the terms and conditions of the Loan Agreement and this Note. This Note includes all attachments and Exhibits listed below, which are attached to and incorporated in this Note by this reference. The capitalized terms in this Note shall have the meanings assigned in the following table of definitions and as defined in the body of the Note. (Terms being defined are indicated by quotation marks. If an item in the table is marked “None, Not Applicable, N/A or equivalent or is left blank, that defined term is not applicable to this Note or the referenced item is not required or is not included in this Note as th e context may indicate.) The Lender is making the Loan to Borrower in consideration of Borrower making this Note and delivering it to Lender.

For purposes of this Note, the following terms shall have the following meanings:

DEFINED TERM: DEFINITION:
“Effective Date” May 1, 2023
“Lender” Sacramento Housing and Redevelopment Agency
“Borrower” Broadway Station, L.P.
“Borrower Legal
Status”
a California limited partnership
“Loan Agreement” The Construction and Permanent Loan Agreement between the Borrower and Lender as of the Effective Date for making of the loan (“Loan”) evidenced by this Note. “Principal
Amount”
Seven Million Three Hundred Thousand Dollars and No Cents ($7,300,000.00) “Interest Rate” The interest rate is 3% per year, simple interest. “Accrual Date” Interest shall accrue starting on the following “Accrual Date”: The Effective Date

“Special Terms”

1. Loan funds shall be used solely for Project construction. No Loan funds shall be used for predevelopment costs, except as provided in an approved Lender budget. Unless otherwise noted in the budget, predevelopment costs are not subject to withholding as Retention.

2. EAH, Inc. is approved by Lender as “Property Manager” for the Property and Project.

3. At completion of construction, Borrower shall submit to Lender a cost certification prepared by a qualified, independent auditor acceptable to Lender, which cost certification shall indicate the amounts actually spent for each item in the cost breakdown. If there is an aggregate savings in the total of all such cost breakdown items from the cost breakdown items in the final Budget approved by the Lender as of the Effective Date, after adjusting for any decrease in any funding source including loss of any equity investment due to an adjustment in the allowable tax credits, the Lender shall withhold for itself as Loan repayment, one-half of such savings from the amount of retention then held by the Lender, and the Loan balance shall be reduced by the amount so withheld. The Lender, in its sole discretion, shall determine any reduction and/or repayment of the Loan based upon this cost certification and the original approved Budget for the Project.

Capitalized terms not otherwise defined in this Note shall have the meanings ascribed thereto in the Loan Agreement.

PAYMENT SCHEDULE. Repayment of this Note shall be made as follows:
“Maturity Date” The first day of the 684th calendar month following the Effective Date. “Payment
Amount(s)”

Annual loan payments shall be deferred from the Loan’s Effective Date through the first 180 months. Beginning May 1, 2028, Annual loan payments will be made on a Residual Receipts basis, as defined below, until the Maturity Date. Annual loan payments shall be applied first to outstanding interest accrued and unpaid and then to principal.

“Residual Receipts” is defined as follows: Once annually, based on the annual audited financial statement from the preceding year, payments will be made upon a “Residual Cash Flow” basis meaning Net Operating Income (NOI) less the items described in the be low

Construction and Permanent Loan Agreement Page 36
Subsections (i) through (viii), no such proceeds or amounts to be applied in payments of any amounts specified in any of the Subsections below until all amounts specified in any earlier Subsection have been paid in full :

Net Cash Flow Distributions. Distributions of Net Cash Flow (where “Net Cash Flow” is defined as Net Operating Income less payment of debt service on the senior loan, and the funding of reserves, and payment of developer fee in the amount anticipated to be paid from capital sources not to exceed amounts allowed by HCD Uniform Multifamily Regulations) will be made as follows, subject to the consent of the senior and subordinate lenders:

(ix) to pay credit adjusters owed to the Investor Limited Partner;

(x) to repay loans made by the Investor Limited Partner to the Borrower;

(xi) to pay the Investor Limited Partner an asset management fee in the annual amount of $8,500, increasing by 3% per year;

(xii) replenish the Operating Reserve pursuant to the loan documents;

(xiii) to payment of any developer fee that is not paid from capital sources as anticipated and becomes deferred, and accrued interest thereon, if any, not to exceed amounts allowed by CA HCD Uniform Multifamily Regulations;

(xiv) to the General Partner or its affiliates to repay any loans or advances made by the General Partner or its affiliates, in support of the development or operation of the Project;

(xv) to pay the General Partner an asset management fee in the annual amount of $16,500, increasing by 3% per year;

(xvi) 50% of the remaining annual Net Cash Flow shall be distributed to Borrow and the other 50% shall be allocated on a pro rata basis:

79.48% to State Department of Housing and Community
Development towards the respective HCD NPLH Competitive Loan, HCD NPLH Non-Competitive Loan, and HCD AHSC Loan; and 20.84% to Sacramento Housing and Redevelopment Agency Lender towards the HOME, HTF, MIHF, and PLHA Loan.

A. First to HOME loan until fully repaid;
B. Then to HTF loan until fully repaid;
C. Then to MIHF loan until fully repaid;
D. Then to PLHA loan until fully repaid;

To the extent that insufficient Net Cash Flow is available to pay any of the amounts set forth in Sections (i) through (viii) when due, such amount shall accrue and be payable in the future when there is available Net Cash Flow, after prior payment of all higher priority payments from Net Cash Flow, as set forth above.

The Net Operating Income is defined as periodic “Revenue” less “Operating Expenses.” “Revenue” means all revenue from the leasing of the Project, including but not limited to all rents, fees, and charges paid by tenants as well as rental subsidy payments regardless of the source of these subsidies, forfeited tenant deposits, rent increases, proceeds from vending machines and laundry room machines. Revenue shall not include tenants’ security deposits (unless forfeited), interest on those deposits, loan proceeds,

Construction and Permanent Loan Agreement Page 37
capital contributions or similar advances, or amounts released from reserves or interest on reserves.

“Operating Expenses” shall mean actual costs, fees and expenses as evidenced by invoices attributable to the operation, recordkeeping, maintenance, taxes and management of the Project, including property management fees; taxes and assessments; payroll, benefits and payroll taxes of for property employees; insurance; security; painting, cleaning, repairs, and alterations; landscaping; sewer charges; utility charges; advertising, promotion and publicity; cable television, satellite and other similar services; office, janitorial, cleaning and building supplies; recreational amenities and supplies; purchase, repair, servicing and installation of appliances; costs and expenses associated with the provision of social and/or community services to the residents of the Project; equipment, fixtures and furnishing; fire alarm and elevator monitoring; fees and expenses of accountants, attorneys, consultants and other professionals: debt service monitoring fee payments to HCD with respect to the NPLH and AHSC Loans . The definition will include deposits into operating and/or replacement reserves maintained by the Borrower but will not include initial deposits to capitalize the reserve accounts or amounts expended from a reserve account, or capital costs.

FOR VALUE RECEIVED, THE UNDERSIGNED, JOINTLY AND SEVERALLY, PROMISES TO PAY to Lender, or its successors or assigns, the Principal Amount or such lesser amount as may be endorsed on this Note on behalf of Lender. The Loan shall bear interest on the outstanding principal balance, computed from the Accrual Date at the Interest Rate.

1. This Note evidences the obligation of Borrower to Lender for repayment of the Loan. The terms and covenants of the Loan Agreement are incorporated in this Note by reference. The Loan Ag reement provides for and incorporates the Regulatory Agreement (as defined in the Loan Agreement), the making of which is further consideration for this Note.

2. All payments on this Note shall be applied first to fees and charges due under the Loan Agreement, if any, then to interest and then to the principal due on this Note. Borrower shall make the payments to the Lender at 801 12th Street, Sacramento, CA 95814, or to such other person or organization as may be designated by Lender to Borrower and noticed as provided in the Loan Agreement.

3. If any installment under this Note is not received by Lender within fifteen (15) calendar days after the installment is due, Borrower shall pay to Lender a late charge of five percent (5%) of such installment. Such late charge shall be immediately due and payable without demand by Lender.

4. This Note is secured by a Deed of Trust and Assignment of Rents against the real property described in the Loan Agreement (“Property”), recorded in the office of the County Recorder of Sacramento County ("Trust Deed"). The Trust Deed securing this Note provides that Lender may at its option, declare all funds secured by the Trust Deed immediately due and payable, if any interest in the Property is refinanced, sold, hypothecate d, transferred or conveyed to any person, whether voluntarily or involuntarily. The Trust Deed further provides that if Borrower does not comply with the requirements of the Regulatory Agreement and fails to come into compliance with the Regulatory Agreement within thirty (30) days after Lender’s written notice to Borrower of such failure Lender may at its option, declare all funds secured by the Trust Deed immediately due and payable.

5. Lender and Borrower shall comply with and fulfill the Special Terms.

6. Upon occurrence of any one or more of the following, Lender may, at its sole discretion, declare all unpaid principal immediately due and payable, together with all unpaid interest at the stated rate from the date of the advancement of the Loan's proceeds, subject to applicable cure periods, if:

a. Borrower defaults in the payment of any principal or interest when due. b. Lender discovers that Borrower, in any application to Lender in connection with the Loan, either (i) failed to disclose, or (ii) misrepresented any fact that would have prevented Borrower from being eligible for the Loan. c. Lender discovers that Borrower has made any misrepresentations or has intentionally withheld any fact in the making or continuation of this Loan, the knowledge of which could have affected the decision of Lender to make the Loan. d. Borrower defaults or breaches any of the terms of Loan Agreement, the Trust Deed, the Regulatory Agreement or this Note.

Construction and Permanent Loan Agreement Page 38
e. Borrower fails to perform any covenant, term or condition in any instrument creating a lien upon the Property which is the security under the Trust Deed, or any part thereof, which lien shall have priority over the lien of the Trust Deed securing this Note. f. The sale, transfer of title, conveyance or further encumbrance of the Property, whether by sale, exchange, gift, inheritance or other means, without prior written consent of Lender, g. Any of the following occur:
1) Borrower becoming insolvent or bankrupt or being unable or admitting, in writing, Borrower’s inability to pay debts as they mature or making a general assignment of or entering into any restructure payment arrangement with creditors. 2) Proceedings for the appointment of a receiver, trustee or liquidator of the assets of Borrower or a substantial part of such assets, being authorized or instituted by or against the Borrower. 3) Proceedings under any bankruptcy, reorganization, readjustment of debt, insolvency, dissolution, liquidation or other similar law of any jurisdiction being authorized or instituted against Borrower.

7. No waiver of any default or breach by Borrower under this Note shall be implied from any omission by Lender to take action on account of such default, and no express waiver shall affect any default, other than the default specified in the waiver. Such waiver shall be in writing and shall be operative only for the time and to the extent therein stated.

8. Borrower may prepay this Note in full or in part at any time, without any prepayment penalty being charged by Lender.

9. During the existence of default or de linquency under the terms of this Note or the Trust Deed, the Lender is expressly authorized to apply all payments made on this Note to the payment of all or part of the delinquency, as it may elect.

10. Subject to the provisions of this Section 10, and notwi thstanding any provision of the Loan Documents other than this Section 10, the personal liability of Borrower, and Borrower’s principals, partners, members, agents, officers, and successors in interest, to pay the principal of and interest on the debt evid enced by this Note and any other agreement evidencing Borrower's obligations under this Note shall be limited to (a) the Collateral (as defined in the Loan Agreement), (b) the personal property described in and pledged under any Loan Document, and (c) the rents, profits, issues, products and income of the Property, including any received or collected by or on behalf of Borrower after an Event of Default under the Loan Documents.

11. Borrower shall pay to Lender all costs of enforcement of all or any portion of this Note, the Trust Deed, and the Regulatory Agreement, including attorney's fees, witness fees, investigator fees and court costs, incurred by Lender, whether or not litigation is commenced.

Construction and Permanent Loan Agreement Page 39
IN WITNESS WHEREOF, Borrower has executed this Note as of the Effective Date.

Borrower:

BROADWAY STATION, L.P, a California limited partnership

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Construction and Permanent Loan Agreement Page 40
Exhibit 4: Trust Deed Form
NO FEE DOCUMENT:

Entitled to free recording
per Government Code §§6103 and 27383.

When recorded, return to:

SACRAMENTO HOUSING AND

REDEVELOPMENT AGENCY
801 12th Street
Sacramento, CA 95814
Attention: Portfolio Management

DEED OF TRUST AND ASSIGNMENT OF RENTS
On Broadway Apartments

For purposes of this Deed of Trust the following capitalized terms shall have the meanings ascribed in the space adjacent to them:

TERM DEFINITION
“Effective Date” May 1, 2023
“Trustor” and
“Borrower”
Broadway Station, L.P., a California limited partnership “Borrower
Address”
22 Pelican Way, San Rafael, Ca 94901
“Trustee” Old Republic Title Company
“Beneficiary” and
“Lender”
Sacramento Housing and Redevelopment Agency, a joint powers agency “Lender Address” 801 12th Street, Sacramento, California 95814 “Property”
Which is real property located in the County of Sacramento and the State of California as more particularly described in the Legal Description.

Address 1901 Broadway, Sacramento, Ca 95818
Assessor’s Parcel Number APN: 01002130080000
“Legal
Description”
The Legal Description of the Property which is more particularly described in the attached Exhibit 1 Legal Description, which is incorporated in and an integral part of this Deed of Trust
“Loan” Which is Lender’s loan to Borrower evidenced by the Note and which is secured by this Deed of Trust.
“Loan
Agreement”
Which is the agreement between Lender and Borro wer stating the term and conditions of the Loan.

Which is dated: May 1, 2023
“Additional
Notices”
Lender shall give copies of notices required to be delivered to Borrower to the following parties at the following addresses; provided, however that Borrower acknowledges that such notice is an accommodation and the failure of the Lender to properly deliver any such notice shall not give rise to any claims or defenses of Borrower or any third party:

Wells Fargo Affordable Housing Corp.
550 S. Tryon Street
23rd Floor, D1086-239
Charlotte, NC 28202-4200
Attention: Director of Tax Credit Asset Management
“Note”
Which is Borrower's promissory note made in accordance with the Loan Agreement evidencing the following principal sum or such l esser amount as shall equal the aggregate amount disbursed to Borrower by Lender, with interest.

Which has a principal sum of Seven Million Three Hundred Thousand Dollars and No Cents ($7,300,000.00)

Construction and Permanent Loan Agreement Page 41

THIS DEED OF TRUST is made as of the Effective Date between the Trustor also referenced as the Borrower, the Trustee, and the Beneficiary also referenced as Lender.

Borrower, in consideration of the indebtedness described below and the trust created by this Deed of Trust, irrevocably grants and conveys the Property to Trustee, in trust with power of sale.

Together with all the improvements now or subsequently erected on the property, and all easements, rights, appurtenances, rents (subject, however, to the rights and authorities given to Lender to collect and apply such rents), royalties, mineral, oil and gas rights and profits, water, water rights, and water stock, and all fixtures, including but not limited to all gas and electric fixtures, engines and machinery, radiators, heaters, furnaces, heating equipment, steam and hot water boilers, stoves, ranges, elevators and motors, bathtubs, sinks, water closets, basins, pipes, faucets and other plumbing and heating equipment, cabinets, mantels, refrigerating plant and refrigerators, whether mechanical or othe rwise, cooking apparatus and appurtenances, furniture, shades, awnings, screens, venetian blinds and other furnishings, now or hereafter attached to the property, all of which, including replacements and additions thereto, shall be deemed to be and remain a part of the property covered by this Deed of Trust; and all of the foregoing, together with said property (or the leasehold estate if this Deed of Trust is on a leasehold) are referred to as the "Property";

To secure to Lender: (a) the repayment of the Loan; and (b) the performance of the covenants and agreements of Borrower contained in this Deed of Trust, the Note, or the Loan Agreement.

Borrower covenants that Borrower is lawfully seised of the estate conveyed by this Deed of Trust and has the right to grant and convey the Property, and that Borrower will warrant and defend generally the title of the Property against all claims and demands, subject to any declarations, easements or restrictions listed in a schedule of exceptions to coverage in any tit le insurance policy insuring Lender's interest in the Property.

Borrower and Lender covenant and agree as follows:

1. Payment of Principal and Interest . Borrower shall promptly pay when due the principal and interest, if any, on the indebtedness evidenced by the Note. All payments received by Lender under the Note shall be applied by Lender first to interest payable on the Note and thereafter to the unpaid principal of the Note.

2. Charges; Liens. Borrower shall pay all taxes, assessments and other charges , fines and impositions attributable to the Property and leasehold payments or ground rents, if any by Borrower making payment, when due, directly to the appropriate payee. Borrower shall promptly furnish to Lender all notices of amounts due under this pa ragraph, and in the event that Borrower makes payment directly, Borrower shall promptly furnish to Lender receipts evidencing such payments. Borrower shall pay when due any encumbrance, charge and lien, with interest in accordance with its terms, on the P roperty or any portion which is inferior or superior to this Deed of Trust.

3. Hazard Insurance. Borrower shall keep the improvements now existing or later erected on the Property insured against loss of fire or hazards under a policy approved by Lender consistent with the insurance requirements of the Loan Agreement.

In addition, Borrower shall insure against loss of all furniture, equipment and other personal property owned by Borrower related to Borrower's operation of the Property. Lender shall have t he right to hold the policies and policy renewals, and Borrower shall promptly furnish to Lender all renewal notices and all receipts of paid premiums. In the event of loss, Borrower shall give prompt notice to the insurance carrier and Lender. Lender may make proof of loss if not made promptly by Borrower.

Unless Lender and Borrower otherwise agree in writing, insurance proceeds shall be applied to restoration or repair of the Property damaged, as and to the extent provided in the Loan Agreement.

Unless Lender and Borrower otherwise agree in writing, any such application of insurance proceeds to principal shall not extend or postpone the due date of any Loan payment or change the amount of such payment. If the Property is acquired by Lender pursuant to this Deed of Trust, all right, title and interest of Borrower in and to any insurance policies and proceeds of such policies resulting from damage to the Property prior to the sale of acquisition shall pass to Lender to the extent of the sums secured by this Deed of Trust immediately prior to such sale or acquisition.

4. Liability Insurance . In addition to the casualty insurance required under the Loan Agreement during the course of construction, Borrower shall keep comprehensive general liability insurance for the Property in a form and coverage consistent with the provisions of the Loan Agreement and reasonably approved by Lender.

Construction and Permanent Loan Agreement Page 42

5. Preservation and Maintenance of Property. Borrower shall keep the Property in good repair and shall not commit waste or permit impairment, demolition, or deterioration of the Property.

6. Protection of Lender's Security . Borrower shall appear and defend any action or proceeding purporting to affect the security under this Deed of Trust or the rights of the Lender. If Borrower fa ils to perform the covenants and agreements contained in this Deed of Trust, or if any action or proceeding is commenced which materially affects Lender's interest in the Property, including, but not limited to, foreclosure, involuntary sale, eminent domai n, insolvency, code enforcement, or arrangements or proceedings involving a bankrupt or decedent, then Lender may, upon notice to Borrower, make such appearances, disburse such sums and take such actions as are necessary to protect Lender's interest, including, but not limited to, disbursement of judgments, costs or reasonable attorney's fees and entry upon the Property to make repairs.

Any amounts disbursed by Lender pursuant to this Section 6, with interest, shall become additional indebtedness of Borrower secured by this Deed of Trust. Unless Borrower and Lender agree to other terms of payment, such amounts shall be payable upon notice from Lender to Borrower requesting payment, and shall bear interest from the date of disbursement at the highest rate permissible under applicable law. In any event, this Section shall be construed as a right and an option of Lender and shall not be construed to require Lender to incur any expense or take any action.

7. Inspection. Lender, by its designated representative, may make reasonable entries upon and inspections of the Property, provided that Lender shall give Borrower and any occupant of the Property reasonable prior notice of any such inspection.

8. Condemnation. The proceeds of any award or claim for damage s, direct or consequential, in connection with any condemnation or other taking of all or any part of the Property, or for conveyance in lieu of condemnation, shall be applied as provided in the Loan Agreement.

If the Property is abandoned by Borrower, or if, after notice by Lender to Borrower that the condemnor offers to make an award or settle a claim for damages, Borrower fails to respond to Lender within 30 days after the date such notice is mailed, Lender is authorized to collect and apply the proceeds, at Lender's option, either to restoration or repair of the Property or to the sums secured by this Deed of Trust.

Unless Lender and Borrower otherwise agree in writing, any such application of proceeds to principal shall not extend or postpone the due date of any payment or change the amount of such payment.

9. Borrower Not Released. Extension of the time for payment of the sums secured by this Deed of Trust granted by Lender to Borrower or any successor in interest of Borrower shall not operate to rele ase, in any manner, the liability of the original Borrower and Borrower's successors in interest. Lender shall not be required to commence proceedings against such successor or refuse to extend time payment by reason of any demand made by the original Borrower or Borrower's successors in interest.

10. Forbearance by Lender Not a Waiver. Any forbearance by Lender in exercising any right or remedy under this Deed of Trust, or otherwise afforded by applicable law, shall not be a waiver or preclude the exercise of any such right or remedy.

The procurement of insurance or the payment of taxes or other liens or charges by Lender shall not be a waiver of Lender's right to accelerate the maturity of the indebtedness secured by this Deed of Trust.

11. Remedies Cumulative. All remedies provided in this Deed of Trust are distinct and cumulative to any other right or remedy under this Deed of Trust, the Note, the Loan Agreement or afforded by law or equity, and may be exercised concurrently, independently or successively.

12. Successors and Assigns Bound; Joint and Several Liability Captions . The covenants and agreements contained in this Deed of Trust shall bind, and the rights under this Deed of Trust shall inure to, the respective successors and assigns of Lender and Borrower, subject to the provisions of Section 15. All covenants and agreements of Borrower shall be joint and several.

The captions and headings of the paragraphs of this Deed of Trust are for convenience only and are not to be used to interpret or to define its provisions.

13. Notice. Except for any notice required under applicable law to be given in another manner, any notice to be given under this Deed of Trust shall be given as provided for in the Loan Agreement. Any notice provided for in this Deed of Trust shall be deemed to have been given to Borrower or Lender when given in the manner designated.

14. Governing Law; Severability. This Deed of Trust shall be governed by the law of the State of California. If any term or provision of this Deed of Trust shall, to any extent, be held invalid or unenforceable, the remainder of this Deed of Trust shall

Construction and Permanent Loan Agreement Page 43
remain in full force and effect and the invalid or unenforceable provision shall be valid and enforceable as to any other person or circumstance.

15. Acceleration on Transfer or Refinancing of the Property; Assumption . Except as otherwise provided in the Loan Agreement or herein, if all or any part of the Property or an interest in the Property is sold or transferred or refinanced by Borrower without Lender's prior written consent, Lender may, at Lender's option, declare all the sums secured by this Deed of Trust to be immediately due and payable. Lender shall have waived such option to accelerate if, prio r to the refinancing, sale or transfer, Lender and the person to whom the Property is to be sold or transferred reach agreement in writing that the loan may be assumed. If Lender has waived the option to accelerate provided in this Section and if Borrower 's successor in interest has executed a written assumption agreement accepted in writing by Lender, Lender shall release Borrower from all obligations under this Deed of Trust and the Note.

If Lender exercises such option to accelerate, Lender shall mail Borrower notice of acceleration. Such notice shall provide a period of not less than 30 days from the date the notice is mailed within which Borrower, or any of its principals or anyone with a substantial legal interest in Borrower, may pay the sums decla red due. If Borrower fails to pay such sums prior to the expiration of such period, Lender may, without further notice or demand on Borrower, invoke any remedies permitted by this Deed of Trust.

16. Acceleration on Breach; Remedies . Except as provided in Se ction 15, upon Borrower's breach of any covenant or agreement of Borrower in this Deed of Trust, the Note, (including the covenants to pay when due any sums secured by this Deed of Trust and restricting transfer of the Property) the Regulatory Agreement, o r Loan Agreement, Lender shall mail notice to Borrower specifying: (1) the breach; (2) the action required to cure such breach; (3) a date, no less than 30 days from the date the notice is mailed to Borrower, by which breach must be cured; and (4) that failure to cure such breach on or before the date specified in the notice may result in acceleration of the sums secured by this Deed of Trust and sale of the Property. If the breach is not cured on or before the date specified in the notice, Lender at Lender's option may declare all of the sums secured by this Deed of Trust to be immediately due and payable without further demand and may invoke the power of sale and any other remedies permitted by applicable law. Lender shall be entitled to collect from th e Borrower, or sale proceeds, if any, all reasonable costs and expenses incurred in pursuing the remedies provided in this Section, including, bu t not limited to reasonable attorney's fees. Borrower’s investor limited partner shall have the right, but not the obligation, to cure any default of Borrower.

If Lender invokes the power of sale, Lender shall execute or cause Trustee to execute a written notice of the occurrence of an event of default and of Lender's election to cause the Property to be sold and shall cause such notice to be recorded in each county in which any portion of the Property is located. Lender or Trustee shall mail copies of such notice in the manner prescribed by applicable law to Borrower and to the other persons prescribed by applic able law. Trustee shall give public notice of sale to the persons and in the manner prescribed by applicable law. After the lapse of such time as may be required by applicable law, Trustee, without demand on Borrower, shall sell the Property at public auction to the highest bidder at the time and place and under the terms designated in the notice of sale, in one or more parcels and in such order as Trustee may determine. Trustee may postpone sale of all or any parcel of the Property by public announcemen t at the time and place of any previously scheduled sale. Lender or Lender's designee may purchase the Property at any sale.

Trustee shall deliver to the purchaser a Trustee's deed conveying the Property so sold without any covenant or warranty, expressed or implied. The recitals in the Trustee's deed shall be prima facie evidence of the truth of the statements it contains.

Trustee shall apply the proceeds of the sale in the following order: (a) to all reasonable costs and expenses of the sale, including, but not limited to, reasonable Trustee's and attorney's fees and costs of title evidence; (b) to all sums secured by this Deed of Trust; and (c) the excess, if any, to the person or persons legally entitled thereto as determined by Lender. I n the event of a dispute regarding the excess funds, either Lender or Trustee may file an action in interpleader to determine who shall receive the funds and may then deposit the excess funds with the court.

17. Assignment of Rents; Appointment of Receiver; Lender in P ossession. As additional security, Borrower assigns to Lender the rents of the Property, provided that Borrower shall, prior to an acceleration for breach as provided above or abandonment of the Property, have the right to collect such rents as they become due.

Upon acceleration for breach or abandonment of the Property, Lender, in person, by agent or by judicially appointed receiver shall be entitled to enter upon, take possession of and manage the Property and to collect the rents of the Property including those past due. All rents collected by Lender, its agent, or the receiver shall be applied first to payment of the costs of management of the Property and collection of rents, including, but not limited to receiver's fees, premiums on receiver's bonds and reasonable attorney's fees, and then to the sums secured by this Deed of Trust. Lender, its agent and the receiver shall be liable to account only for those rents actually received.

Construction and Permanent Loan Agreement Page 44

18. Prior Lienholder. The provisions of this Deed of Trust shall operate subject to the claims of prior lienholders to the extent of such claims.

19. Nonrecourse. Notwithstanding any provision of this Deed of Trust or any document evidencing or securing the Loan, Borrower, and Borrower’s principals, agents, officers, and successors in interest shall not be personally liable for the payment of the Loan or any obligation of the Loan, and in the event of a default Lender shall look solely to the Property subject to this Deed of Trust and to the rents, issues and profits thereof in satisfaction of the indebtedness evidenced by the Note; provided, that nothing in this condition and no action so taken shall operate to impair any obligation of Borrower under the Regulatory Agreement.

20. Reconveyance. Upon payment of all sums secured by this Deed of Trust, Lender shall request Trustee to reconvey the Property and shall surrender this Deed of Trust and all notes evidencing indebtedness secured by this Deed of Trust to Trustee.

Trustee shall reconvey the Property without warranty and with out charge to the person or persons legally entitled to such reconveyance. Such person or persons shall pay all costs of recordation, if any. The recitals in the reconveyance of any matters or facts shall be conclusive proof of their truthfulness.

21. Substitute Trustee. Lender, at Lender's option, may from time to time remove Trustee and appoint a successor trustee to any Trustee appointed under this Deed of Trust. Without conveyance of the Property, the successor trustee shall succeed to all the title, power and duties conferred upon the Trustee by this Deed of Trust and applicable law.

22. Request for Notice. Borrower and each party listed to receive Additional Notices request that copies of the notice of default and notice of sale be sent to their respective addresses.

23. Statement of Obligation. Lender may collect a reasonable fee for furnishing the statement of obligation as provided by Section 2943 of the Civil Code of California, as it may be amended from time to time.

24. Use of Property. Borrower shall not permit or suffer the use of any of the Property for any purpose other than the use for which the same was intended at the time this Deed of Trust was executed.

25. Extended Use Agreement. In order to receive an allocation of federal low income housing tax credits, Borrower will be required to record in the real property records of the County in which the property is located, an “extended low -income housing commitment” (as defined in Section 42(h)(6)(B) of the Internal Revenue Code of 1986, as amended (“Code”)) (“Extended Use Agreement”). Lender acknowledges and agrees that, in the event of a foreclosure of its interest under this Deed of Trust or delivery by Borrower of a deed in lieu thereof (collectively, a “Foreclosure”), Lender expressly agrees to undertake, with respect to low-income housing tenants, the requirements of Section 42(h)(6)(E)(ii) of the C ode, as amended from time to time.

Construction and Permanent Loan Agreement Page 45

IN WITNESS WHEREOF, Borrower has executed this Deed of Trust.

BORROWER (Trustor):

BROADWAY STATION, L.P.

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Construction and Permanent Loan Agreement Page 46
EXHIBIT 1

LEGAL DESCRIPTION

The land referred to in this Report is situated in the County of Sacramento, City of Sacramento, State of California, and is described as follows:

PARCEL ONE:

LOTS 1, 2, 7 AND 8, IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF.

PARCEL TWO:

ALL THAT PORTION OF THAT CERTAIN ALLEY IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF, PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING AT THE SOUTHWESTERLY CORNER OF LOT 1 OF SAID BLOCK, SAID CORNER BEING AT THE INTERSECTION OF THE EASTERLY LINE OF 19TH STREET AND THE NORTHEASTERLY LINE OF SAID ALLEY; THENCE SOUTHEASTERLY 151 FEET, ALONG THE SOUTHWESTERLY LINE OF SAID LOT AND LOT 2 OF SAID BLOCK; THENCE SOUTHERLY IN A DIRECT LINE ACROSS SAID ALLEY TO THE NORTHEASTERLY CORNER OF LOT 7 OF SAID BLOCK, SAID CORNER BEING LOCATED ON THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; THENCE NORTHWESTERLY 160 FEET, ALONG THE NORTHEASTERLY LINE OF SAID LOTS 7 AND 8, IN SAID BLOCK, AND THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; TO THE NORTHWESTERLY CORNER OF SAID LOT 8, LOCATED ON THE EASTERLY BOUNDARY LINE OF SAID 19TH STREET; THENCE NORTHEASTERLY 20 FEET ALONG SAID EASTERLY BOUNDARY LINE OF 19TH STREET, TO THE POINT OF BEGINNING.

APN: 010-0213-008

Construction and Permanent Loan Agreement Page 47
Exhibit 5: HOME Regulatory Agreement
NO FEE DOCUMENT:

Entitled to free recording
per Government Code §§6103 & 27383.

When recorded, return to:

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY
801 12th Street, 4th Floor
Sacramento, CA 95814
Attn: Portfolio Management

HOME REGULATORY AGREEMENT FOR RESIDENTIAL RENTAL PROPERTY

AND DECLARATION OF RESTRICTIVE COVENANTS AFFECTING REAL PROPERTY

PROJECT NAME: On Broadway Apartments
PROJECT ADDRESS: 1901 Broadway Sacramento, Ca 95818
APN: 01002130080000

FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT OF WHICH IS ACKNOWLEDGED, AGENCY AND OWNER HAVE

ENTERED THIS REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS AFFECTING REAL PROPERTY (REGULATORY AGREEMENT) AS OF THE EFFECTIVE DATE.

1. GENERAL. This Regulatory Agreement includes the Exhibits listed belo w which are attached to and incorporated in this Regulatory Agreement by this reference.

2. DEFINITIONS. The capitalized terms in this Regulatory Agreement shall have the meanings assigned in the following table and in the body of this Regulatory Agreement as the context indicates. Terms being defined are indicated by quotation marks.

TERM DEFINITION
“Effective Date” This Regulatory Agreement shall be effective as of the following date: May 1, 2023 “Agency” Sacramento Housing and Redevelopment Agency
a joint powers agency.
“Agency Address” Agency’s business address is 801 12th Street, Sacramento, California 95814 “Owner” Broadway Station, L.P.
“Owner Address” Owner’s business address is as follows: 22 Pelican Way, San Rafael, CA 94901 “Jurisdiction” City of Sacramento
“Property”
That certain real property which is subject to this Regulatory Agreement as further described in the legal description, attached as Exhibit 1 – Legal Description of the Property and incorporated in this Regulatory Agreement by this reference
“Funding
Agreement”
The Funding Agreement between
Agency and Owner as follows:

Titled: Construction and Permanent Loan
Agreement
Dated: May 1, 2023
“Agency Funding” Agency Funding made by Agency to Owner under the Funding Agreement for development of the Property
“Agency Funding
Amount“
The amount of Agency Funding, as follows from HOME: $2,400,000.00 “Funding
Requirements”
The legal restrictions on the use of the funds that Agency has used to make Agency Funding, as applicable to and restricting the Property. The Funding Requirements are set out in Exhibit 2 – Funding Requirements.
“Approved Use” The only permitted use of the Property, which is as a residential property available for rent by the general public and containing not less than the following number of units:
140

3. RESTRICTED PARCELS; APPROVAL OF LEASES. In order to assure that the proper number and types of units have been rented in accordance with this Regulatory Agreement, Owner is prohibited from leasing any Unit within the Project until either the parties have recorded against the Property a list of the Restricted Units or Agency has approved the individual lease or lease form for the Restricted Units. The following numbers of units are restricted for each respective funding source. The

Construction and Permanent Loan Agreement Page 48
initial rents for the Restricted Units shall be the following; pr ovided, however, that upon the request of Owner, Owner and Agency may agree to a schedule for the Restricted Units that complies with the following affordability requirements as of the date when the Project is available for occupancy. In any event the rents for the Restricted Units may be adjusted not more often than annually. The rents shall include allowance for utilities and costs reasonably related to the rental of the Restrictive Units, as may be required in determining the rents for the applicable funding sources. Only Restrictive Units indicated under Agency Funding Source are assisted by Agency. Nevertheless, Owner shall assure the affordability of all of the following Restrictive Units at the named affordability levels.

4. RESTRICTIVE UNITS. Re strictive Units with HOME as its funding source are fixed units if referenced by Apartment Number or equivalent; otherwise such units are "floating units" in which the number of units of an affordability level and bedroom type remains the same, but the act ual designated unit may change from time to time. Notwithstanding any conflicting provision in the Funding Requirements, the Initial Rent per Unit per Month listed in this Regulatory Agreement shall be paramount and controlling.

Agency Funding
Source: Affordability Level: Number of
Units: Restricted Units:

Initial Rent
per Unit per
Month:

HOME 50% 5 1-Bedroom $950
HOME 50% 3

2-Bedroom $1,140
HOME 50% 3

3-Bedroom $1,317
Total Restricted
Units
11 5. MANAGEMENT AGREEMENT. Owner agrees that at all times the Project shall be managed by a property manager (i) approved by Agency in its reasonable discretion and (ii) who has successfully managed at least five projects over forty units in size and subject to a recorded regulatory agreement for at least t hree years’ prior to the application, without any record of material violations of discrimination restrictions or other state or federal laws or regulations or local governmental requirements applicable to such projects (the “Manager”). Owner shall submit to Agency from time to time such information about the background, experience and financial condition of any existing or proposed Manager as Agency may reasonably require to determine whether such Manager meets the requirements for a Manager set forth herein. Agency reserves the right to conduct periodic reviews of the management practices and of the Manager to determine if the Project is being operated and managed in accordance with the requirements and standards of this Regulatory Agreement and the Fund ing Agreement.

Owner agrees to cooperate with Agency in such reviews.

If Agency determines in its reasonable judgment that the Project is not being operated and managed in accordance with one or more of the requirements or standards of the Funding Agre ement, Agency may deliver notice to Owner requesting replacement of the Manager, which notice shall state clearly the reasons for such request. Owner agrees that, upon receipt of such notice, Owner shall within 60 days submit to Agency, a proposal to enga ge a new Manager meeting the requirements of this provision. Agency shall respond within 30 days to such proposal or such approval shall be deemed given. Upon receipt of such consent or deemed consent, Owner shall promptly terminate the existing Manager’s engagement and engage the new Manager.

Owner shall not enter into any management agreement or arrangement with any party with respect to the management of the Project without Agency's prior written consent, such consent not to be unreasonably withheld or delayed. Owner shall not materially modify, amend or terminate any approved management agreement (other than as required to comply with the terms of the Funding Agreement and/or applicable law) without Agency's prior written consent, which consent will no t be unreasonably withheld or delayed; provided, however, that such consent shall not be required to extend the term of an existing management agreement.

Approved Management Company
EAH Inc.

6. SPECIAL PROVISIONS. Owner shall also comply with the following special provisions.

Provision

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ANNUAL ADMINISTRATIVE FEE. Borrower agrees to pay an annual administrative fee (“Fee”) to Lender as compensation for monitoring compliance with regulatory restrictions and the administration of the Loan. Borrower shall pay annually a Fee equal to $25,000. Fee payments shall commence on the Closing Date for the prorated semiannual period from the Closing Date to and including October 31, 2023, and in equal semiannual installmen ts in advance on each May 1 and October 1 of each year thereafter throughout the term of the Regulatory Agreement.

7. REPRESENTATIONS. Agency has provided Agency Funding to Owner to develop the Property, subject to the terms of the Funding Agreement. For purposes of this Section 7, “Property” shall mean Property or Restricted Unit as the context may indicate. This Regulatory Agreement is a substantial part of the consideration to Agency for making Agency Funding. The funds used by Agency under the Funding Agreement are funds from public funding sources administered by Agency and their use is subject to certain requirements some of which are embodied in this Regulatory Agreement. Further, Agency has made Agency Funding in accordance with the laws, rules an d regulations to which Agency is subject. Therefore, Agency has made Agency Funding conditioned upon Owner’s agreement, for itself and its successors and assigns, to comply with all provisions of this Regulatory Agreement, including without limitation, the Funding Agreement. Owner represents that it has had full opportunity to make itself independently familiar with such limitations and restrictions, and Owner accepts them and agrees to comply fully with them.

8. COVENANTS. Owner makes the following covenan ts. Unless Owner has received the prior written consent or Agency approval otherwise, Owner shall fully comply with each and every covenant. Except as otherwise stated in this Regulatory Agreement, the following covenants shall have a term that is the sa me as the longest term specified in the Funding Requirements.

a. Owner shall use and permit others to use the Property only for the Approved Use.

b. Owner shall ensure full compliance with the Funding Requirements.

c. Owner shall not convey, transfer, hypothecate, or otherwise encumber any of the Property or permit the conveyance, transfer, hypothecation, or encumbrance of the Property unless such assignee, transferee, beneficiary, or encumbrancer has agreed, in writing and in a form suitable for recordation, to be bound by the terms of this Regulatory Agreement.

d. Owner shall not cause and shall not permit expansion, reconstruction, or demolition of any part of improvements on the Property, except as provided by the Funding Agreement.

e. Owner shall main tain the Property and all building improvements, grounds and equipment of the Property in good repair and condition and in compliance with all applicable housing quality standards and local code requirements. Owner shall maintain the Property in good condition and shall keep the Property reasonably free from graffiti and unrepaired vandalism and from accumulation of abandoned property, inoperable vehicles, unenclosed storage, debris, waste materials, and hazardous substances. In the event of a casualty loss, Owner shall cause the restoration or replacement of the Property, in a timely manner and provided that such restoration or replacement is then economically feasible.

f. Owner shall not cause and shall not permit discrimination based on race, color, natio nal origin, religion, sexual orientation, gender, familial status, age or disability in the sale, lease, or rental or in the use or occupancy of the Prope rty.

Owner covenants by and for him/her/itself, his/her/its heirs, executors, administrators, and assi gns, and all persons claiming under or through them that there shall be no discrimination against or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. T his covenant against discrimination shall continue in perpetuity.

g. Owner shall not evict, refuse to rent to, or otherwise treat someone differently because of that person’s status as a victim of domestic violence, dating violence, sexual assault, or stalking, in compliance with the Violence Against Women Act. This protection is available regardless of sex, gender identity, or sexual orientation.

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h. Owner shall ensure compliance with the obligations imposed by the federal Personal Responsibility and Work Opportunity Act (Public Law 104-193, commonly known as the Welfare Reform Act) as amended by California Welfare and Institutions Code Section 17851, which restrict Agency funding of federal, state or local benefits to persons who are not citizens or qualified aliens as defined in such act.

i. Owner shall provide Agency with a detailed resident services plan including but not limited to the following information: (1) identification of all entities responsible for providing resident services to Project tenants and each entity’s role in the provision of those services; (2) a description of the services to be provided; (3) a resident services budget and proforma; and (4) Agency approved resident services at the Project according to the following minimum schedule o f sixty (60) hours per week:

1) Coordinator: Six (6) hours per week (maximum)
2) After School programming ten (10) hours per week (two hours per day and five days per week, minimum) 3) Additional Programming: balance of forty-four (44) hours per week shall include the following:
a) Workforce development support and activities
b) educational classes such as nutrition, exercise, health resources, health insurance application assistance, annual onsite health fair, English as a Second Language (ESL) classes. c) Socialization activities such as bingo, gardening and community building events; and d) Other services such as case management, planned recreation, transportation assistance, counseling assistance and employee readiness and job search assistance.

j. Owner shall not pass utility charges paid by Owner, including water, sewer, and garbage collection charges, through to tenants as an add-on to their contracted rent subject to adjustments permitted by applicable utility allowances.

k. Owner shall not make payment of rental ins urance premiums a condition of occupancy. If Owner require renters’ insurance, the policy premium must be deducted from the tenant’s rent. Owner shall not add the insurance premium to the tenant’s rent in either the initial or subsequent years.

l. Owner shall make all of the units, indoor common areas and buildings smoke free.

9. NATURE OF COVENANTS. The provisions contained in this Regulatory Agreement are covenants which subject and burden the Property, as covenants running with the land. It is intended and agreed that the agreements and covenants provided in this Agreement shall be covenants running with the land and equitable servitudes on the land and that they shall, in any event, and without regard to technical classifications or designation, be bind ing, to the fullest extent permitted by law and equity, for the benefit and in favor of, and enforceable by, Agency, Agency’s successors and assigns, any other governmental entity acting within its authority and any successor in interest to Agency’s interest under this Regulatory Agreement against Owner, its successors and assigns and every successor in interest to all or any part of the Property.

10. TERM. The term of this Regulatory Agreement shall commence on the Effective Date and continue until the terms of all of the covenants, including without limitation, the terms stated in the Funding Requirements, have expired or otherwise been terminated. Notwithstanding the term in the Funding Requirements, the term of this Regulatory Agreement shall be twenty (20) years from the Effective Date.

11. EXPIRATION OF AFFORDABILITY PERIOD. Owner agrees the rent of “in-place” tenants at the conclusion of the Term will continue to be governed by the applicable affordability restrictions, so long as those tenants continue to live in the development.

12. MULTIPLE FUNDING REQUIREMENTS. If more than one form of Funding Requirements is attached, each Restricted Unit shall be subject to the Funding Requirements for every Funding Source applied to the respective Restricted Unit. If the terms of the Funding Requirements shall conflict as to any Restricted Unit, the Funding Requirements shall be construed so as to meet all applicable requirements for the respective Restricted Unit, including without limitation the use of the most restrictive requirements and the use of the “Recapture” formula that results in the greatest repayment to Agency.

Construction and Permanent Loan Agreement Page 51

13. RECORDKEEPING AND REPORTING. Upon request of Agency, Owner shall promptly provide any additional information or documentation requested in writing by Agency to verify Owner’s compliance with the provisions of this Regulatory Agreement. At the written request of Agency, Owner shall, within a reasonable time following receipt of such request, furnish reports and shall give specific answers to questions upon which information is desired from time to time relative to the income, assets, liabilities, contracts, operations, and condition of the property and the status of any deeds of trust encumbering the Property.

14. AUDIT AND INSPECTION. The Property and all related equipment, buildings, plans, offices, books, contracts, records, documents and other related papers shall at all times be maintained in reasonable condition for audit and shall be subject to examination by Agency or its agents. The books and accounts of the operations of the Property shall be kept in accordance with generally accepted accounting principles. Owner shall provide Agency acc ess to the Property and its tenants during reasonable hours for the purpose of reviewing Owner’s compliance with this Regulatory Agreement.

15. INDEMNITY FOR OWNER’S FAILURE TO MEET LEGAL REQUIREMENTS. Owner shall indemnify and hold Agency, its officers, di rectors, and employees harmless from any and all liability arising from Owner’s failure to comply with the covenants, conditions and restrictions contained in this Regulatory Agreement or to comply with all other laws, rules, regulations and restrictions related to the use of Agency Funding. Without limitation, such indemnity shall include repayment to the appropriate parties of rents or sales proceeds in excess of amounts authorized to be charged and repayment to Agency of the costs of funds and the value of lost opportunities resulting from the required repayment by Agency to the funding source of funds improperly used.

16. CHANGES WITHOUT CONSENT OTHERS. Only Agency and its successors and assigns, and Owner (subject to the reasonable approval of Owner’s lender and investor limited partner) shall have the right to consent and agree to changes in, or to eliminate in whole or in part, any of the covenants or restrictions contained in this Regulatory Agreement without the consent of any easement holder, licen see, other mortgagee, trustee, beneficiary under a deed of trust or any other person or entity having any interest less than a fee in the Property.

17. DEFAULT. Upon a breach of any of the provisions of this Regulatory Agreement by Owner, Agency may give wr itten notice of such breach to Owner by registered or certified mail. If such violation is not corrected to the satisfaction of Agency within thirty (30) days after the date such notice is mailed or within such further time as Agency may determine in its sole and absolute discretion is necessary to correct the breach, and without further notice to Owner, Agency may declare a default under this Agreement, effective on the date of such declaration of default, and upon such default Agency may: (a) take any action then available under the Funding Agreement for a default under the Funding Agreement; (b) apply to any court for specific performance of this Regulatory Agreement, (c) apply to any court for an injunction against any violation of this Agreement; (d) apply to any court for the appointment of a receiver to take over and operate the Property in accordance with the terms of this Regulatory Agreement, (e) apply to any court for money damages; or (f) apply to any court or other tribunal for such other relief as may be appropriate. The parties agree the injury to Agency arising from a default under any of the terms in this Regulatory Agreement would be irreparable, and the amount of damage would be difficult to ascertain. A copy of any notice sent to Owner will be sent to Owner’s investor limited partner at the following address: Wells Fargo Affordable Housing Corp., 550 S. Tryon Street, 23 rd Floor, D1086-239, Charlotte, NC 28202 -4200, Attention: Director of Tax Credit Asset Management; provided, however, t hat failure by Agency to deliver such notice to Owner’s investor limited partner shall not impair Agency’s rights in any way. Such investor limited partner shall have the right, but not the obligation, to cure any default of the Owner on the same terms as Owner.

18. REGULATORY AGREEMENT VIOLATIONS. Owner shall pay the program compliance fees and expenses to Agency set forth in Compliance Violations and Actions (Exhibit 3 - Compliance Violations and Actions) in reimbursement of the amounts and time expended by Agency to insure Owner’s compliance with State statutes and federal regulations and Owner’s obligations under this Regulatory Agreement as a result of Owner not meeting its obligations and reporting requirements. No compliance fee will be assessed for o ne incident of each type of compliance violation per annual inspection provided the violation is corrected within the specified corrective time period. The second and subsequent violations will be assessed compliance fees as detailed in the Compliance Violations and Actions tables.

19. BINDING SUCCESSORS IN INTEREST. This Regulatory Agreement shall bind and the benefits shall inure to Owner, its successors in interest and assigns, and to Agency and its successors for the term of this Regulatory Agreement.

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20. CONTRADICTORY AGREEMENTS. Owner warrants that it has not, and will not, execute any other agreement with provisions contradictory of or in opposition to, the provisions of this Regulatory Agreement, and that, in any event, to the extent permitted by law, the requirements of this Regulatory Agreement are paramount and controlling as to the rights and obligations set forth and supersede any other requirements in conflict with this Regulatory Agreement.

21. COMPLIANCE AMENDMENTS. If revisions to the provisions o f this Regulatory Agreement are necessitated to comply with the laws or regulations governing Agency Funding, Owner agrees to execute modifications to this Regulatory Agreement that are needed to comply with such laws or regulations.

22. ATTORNEYS' FEES. If the services of any attorney are required by any party to secure the performance of this Regulatory Agreement or otherwise upon the breach of default of another party, or if any judicial remedy or mediation is necessary to enforce or interpret any provision of this Regulatory Agreement or the rights and duties of any person in relation to this Regulatory Agreement, the prevailing party shall be entitled to reasonable attorneys' fees and costs in addition to any other relief to which such party may be entitled. Any award of damages following judicial remedy or arbitration as a result of this Regulatory Agreement or any of its provisions shall include an award of prejudgment interest from the date of the breach at the maximum amount of interest allowed by law. The prevailing party shall mean the party receiving an award in arbitration or a judgment in its favor, unless the award or judgment is less favorable than the best settlement offered in writing in a reasonable manner by the other party, in which case the prevailing party is the other party.

23. SEVERABILITY. The invalidity or unenforceability of any clause, part or provision of this Regulatory Agreement shall not affect the validity of the remaining portions.

24. ELECTION OF REMEDIES. To the extent applicable, in the event of any breach of any covenant, condition or restriction contained in this Regulatory Agreement, Agency shall reasonably endeavor to remedy such breach by conference and conciliation. If, in the opinion of Agency, Agency and Owner are unabl e mutually to agree upon a suitable remedy or the circumstances so warrant, such breach may be enjoined or abated by appropriate proceedings brought by Agency.

Agency may institute or prosecute in its own name, any suit Agency may consider advisable in or der to compel performance of any obligation of any owner to develop and maintain the subject property in conformity with this Regulatory Agreement and to remedy any default of this Regulatory Agreement. Agency may also seek a decree requiring removal of any improvements constructed on the Property which improvements are designed for uses not permitted under this Regulatory Agreement and which improvements are unsuitable only for uses not permitted under this Regulatory Agreement.

The remedies of Agency un der this Regulatory Agreement are cumulative, and the exercise of one or more of such remedies, including, without limitation, remedies under the Funding Agreement shall not be deemed an election of remedies and shall not preclude the exercise by Agency of any one or more of its other remedies.

25. NO WAIVER. No waiver by Agency of any breach of or default under this Regulatory Agreement shall be deemed to be a waiver of any other or subsequent breach or default.

26. NOTICES. Written notices and other written communications by and between the parties shall be addressed to Owner at Owner’s Address and to Agency at Agency Address or such other address as each respective party has designated by written notice to the other party.

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THE PARTIES HAVE EXECUTED THIS REGULATORY AGREEMENT in Sacramento, California as of the Effective Date

BROADWAY STATION, L.P, a California limited partnership

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Construction and Permanent Loan Agreement Page 54
THE PARTIES HAVE EXECUTED THIS REGULATORY AGREEMENT in Sacramento, California as of the Effective Date

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY,

A JOINT POWERS AGENCY

By: _______________________________________
La Shelle Dozier, Executive Director

Approved as to form:

___________________________________________
Agency Counsel

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EXHIBIT 1

Legal Description
The land referred to in this Report is situated in the County of Sacramento, City of Sacramento, State of California, and is described as follows:

PARCEL ONE:

LOTS 1, 2, 7 AND 8, IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF.

PARCEL TWO:

ALL THAT PORTION OF THAT CERTAIN ALLEY IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF, PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING AT THE SOUTHWESTERLY CORNER OF LOT 1 OF SAID BLOCK, SAID CORNER BEING AT THE INTERSECTION OF THE EASTERLY LINE OF 19TH STREET AND THE NORTHEASTERLY LINE OF SAID ALLEY; THENCE SOUTHEASTERLY 151 FEET, ALONG THE SOUTHWESTERLY LINE OF SAID LOT AND LOT 2 OF SAID BLOCK; THENCE SOUTHERLY IN A DIRECT LINE ACROSS SAID ALLEY TO THE NORTHEASTERLY CORNER OF LOT 7 OF SAID BLOCK, SAID CORNER BEING LOCATED ON THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; THENCE NORTHWESTERLY 160 FEET, ALONG THE NORTHEASTERLY LINE OF SAID LOTS 7 AND 8, IN SAID BLOCK, AND THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; TO THE NORTHWESTERLY CORNER OF SAID LOT 8, LOCATED ON THE EASTERLY BOUNDARY LINE OF SAID 19TH STREET; THENCE NORTHEASTERLY 20 FEET ALONG SAID EASTERLY BOUNDARY LINE OF 19TH STREET, TO THE POINT OF BEGINNING.

APN: 010-0213-008

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EXHIBIT 2

Funding Requirements
HOME Funding and Other Federal Requirements
Rental Project
These “HOME Funding and Other Federal Requirements” are attached to the Loan Documents (Loan Agreement and Regulatory Agreement), and are incorporated in the Loan Documents. The capitalized terms used in these HOME Funding and Other Federal Requirements shall have the meanings below in the body of these HOME Funding and other Federal Requirements. Terms being defined are indicated by quotation marks. Capitalized terms in these HOME Funding and Other Federal Requirements that are not defined below are defined in the Loan Documents. References to the CFR are to the Code of Federal Regulations. Project specific restrictions are set forth in the Regulatory Agreement.

1. Definitions. For the purposes of the Loan Documents and in addition to the definitions mad e elsewhere in the Loan Documents, the following capitalized words and phrases contained in this Contract shall have the following meanings:
“HOME” is the federal HOME Investment Partnership program (Catalogue of Federal Domestic Assistance FDA

14.239) administered by the U.S. Department of Housing and Urban Development. a. The “HOME Requirements” are the laws, rules and regulations which are specifically applicable to this contract. A substantial portion of the Federal Requirements are included in th ese HOME Funding and Other Federal Requirements.
b. “Exhibits” to these HOME Funding and Other Federal Requirements contain a substantial portion of the Federal Requirements, and are incorporated into this Agreement in the form of a cloud content management and file sharing service (e.g., Box).

Borrower acknowledges that they have reviewed and accept these Exhibits by initialing here: ____.

The Exhibits included the following:
i. Exhibit 1 – HOME Regulations: 24 Code of Federal Regulations (CFR) Part 92. ii. Exhibit 2 – Requirements for nonprofit subgrantees; 2 CFR §200.70; Appendix VIII to 2 CFR Part 200
iii. Exhibit 3 –Restrictions on Lobbying; 24 CFR Part 87; see also 2 CFR §200.450 iv. Exhibit 4- Federal Labor Standards Provisions: 29 CFR Part 5

2. Recitals. The Agency Funding i ncludes proceeds of the federal HOME Investment Partnerships Act (“HOME”) and its implementing regulations (commencing at 24 CFR Part 92) (“HOME Funds”). The Agency has approved the Agency Funding on condition that the property described in the Loan Docum ents (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with laws, rules and regulations regarding the use of HOME funds for the benefit of low -income persons (“HOME Restricted U nits”) by recordation of these H OME Funding and Other Federal Requirements as covenants running with the land. HOME Restricted Units are made affordable by such regulation to persons and households that qualify as low -income or very low -income as indicate d in the table in Section 3 of the Regulatory Agreement.

3. Use of HOME Funds. Owner shall assure that the HOME Funds are used only for qualified uses. HOME Funds may only be used to provide incentives to develop and support affordable rental housing and ho meownership affordability through the acquisition (including assistance to homebuyers), new construction, reconstruction, or rehabilitation of non - luxury housing with suitable amenities, including real property acquisition, site improvements, conversion, d emolition, and other expenses, including financing costs, relocation expenses of any displaced persons, families, businesses, or organizations; to provide tenant -based rental assistance, including security deposits; to provide payment of reasonable administrative and planning costs; and to provide for the payment of operating expenses of community housing development organizations, all as further defined in 24 CFR §§ 92.205 -92.209. The HOME Funds shall not be used for project reserve accounts except as expressly authorized or to provide operating subsidies.

Owner shall not utilize the Project for explicitly religious activities, including activities that involve overt religious content such as worship, religious instruction, or proselytization, and to the extent that Owner engages in such explicitly religious activities, it shall perform such activities and offer such services outside of the program pursuant to which Owner is developing the Project pursuant to this Agreement. The Owner further represents that the Project units are available to a ll

Construction and Permanent Loan Agreement Page 57
persons regardless of religion, religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice; and that there are no religious or membership criteria for tenants of the Property.

4. Section 3 Requirements. Owner shall ensure compliance with the following Section 3 Requirements. The terms used in this Section shall have the meanings assigned to them in 24 CFR Part 75. Further, Owner shall ensure all Covered Contracts, as defined in 24 CFR Part 75, related to the Project contain the provisions set forth in this Section 4, subsections a through f (the “Section 3 Clause”):
a. The work to be performed under this contract is subject to the requirements of section 3 of the Housing and Urban Development Act of 1968, as amended , 12 U.S.C. 1701u (section 3). The purpose of section 3 is to ensure that employment and other economic opportunities generated by HUD assistance or HUD-assisted projects covered by section 3, shall, to the greatest extent feasible, be directed to low- and very low-income persons, particularly persons who are recipients of HUD assistance for housing.
b. The parties to this contract agree to comply with HUD's regulations in 24 CFR part 75, which implement section 3. As evidenced by their execution of this contract, the parties to this contract certify that they are under no contractual or other impediment that would prevent them from complying with the part 75 regulations. c. The contractor agrees to send to each labor organization or representative of workers wi th which the contractor has a collective bargaining agreement or other understanding, if any, a notice advising the labor organization or workers' representative of the contractor's commitments under this section 3 clause, and will post copies of the notic e in conspicuous places at the work site where both employees and applicants for training and employment positions can see the notice. The notice shall describe the section 3 preference, shall set forth minimum number and job titles subject to hire, availability of apprenticeship and training positions, the qualifications for each; and the name and location of the person(s) taking applications for each of the positions; and the anticipated date the work shall begin. d. The contractor agrees to include this se ction 3 clause in every subcontract subject to compliance with regulations in 24 CFR part 75, and agrees to take appropriate action, as provided in an applicable provision of the subcontract or in this section 3 clause, upon a finding that the subcontracto r is in violation of the regulations in 24 CFR part 75. The contractor will not subcontract with any subcontractor where the contractor has notice or knowledge that the subcontractor has been found in violation of the regulations in 24 CFR part 75. e. The contractor will certify that any vacant employment positions, including training positions, that are filled (1) after the contractor is selected but before the contract is executed, and (2) with persons other than those to whom the regulations of 24 CFR part 75 require employment opportunities to be directed, were not filled to circumvent the contractor's obligations under 24 CFR part 75.
f. Noncompliance with HUD's regulations in 24 CFR part 75 may result in sanctions, termination of this contract for default, and debarment or suspension from future HUD assisted contracts. g. With respect to work performed in connection with section 3 covered Indian housing assistance, section 7(b) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450e) also applies to the work to be performed under this contract. Section 7(b) requires that to the greatest extent feasible (i) preference and opportunities for training and employment shall be given to Indians, and (ii) preference in the award of contracts and sub contracts shall be given to Indian organizations and Indian-owned Economic Enterprises. Parties to this contract that are subject to the provisions of section 3 and section 7(b) agree to comply with section 3 to the maximum extent feasible, but not in derogation of compliance with section 7(b).

5. Property Standards. Upon completion, the Project will comply with the applicable property standards of 24 CFR §

92.251. For the term of these Funding Requirements, Owner shall provide Agency access at all reaso nable times for inspection to assure compliance with such standards. Such provisions are generally as follows:
a. If the Project is new construction, it must meet all applicable local codes, rehabilitation standards, ordinances, and zoning ordinances at the time of project completion. Newly constructed housing must meet the current edition of the Model Energy Code published by the Council of American Building Officials. b. All other HOME -assisted housing (such as acquisition) must meet all applicable State and local housing quality standards and code requirements.

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c. The housing must meet the accessibility requirements at 24 CFR part 8, which implements Section 504 of the Rehabilitation Act of 1973 (29 United States Code (USC) Section 794) and covered multifamily d wellings, as defined at 24 CFR §100.201, must also meet the design and construction requirements at 24 CFR §100.205, which implement the Fair Housing Act (42 USC §§ 3601et. seq.).
d. Construction of all manufactured housing must meet the Manufactured Home Con struction and Safety Standards established in 24 CFR Part 3280. These standards pre -empt State and local codes covering the same aspects of performance for such housing. Also, installation of manufactured housing units must comply with applicable State and local laws or codes, or in the absence of such laws or codes, the participating jurisdiction must comply with the manufacturer's written instructions for installation of manufactured housing units. Manufactured housing that is rehabilitated using HOME funds must meet the requirements set out in Section 4.a. e. Owner must maintain the housing in compliance with all applicable State and local housing quality standards and code requirements and if there are no such standards or code requirements, the housing must meet the housing quality standards in 24 CFR §982.401.

6. Lead-Based Paint. Owner shall comply with the Lead -Based Paint Poisoning Prevention Act (42 USC §4821et. seq.), the Residential Lead -Based Paint Hazard Reduction Act of 1992 (42 U.S.C. §4851et. s eq.), and implementing regulations.

7. Affordability Requirements. Owner shall assure that the of HOME Restricted Units shall be rented at or below the following rates:
a. Low-Income Units shall be rented for amounts that do not exceed thirty percent (30%) of sixty-five percent (65%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development (“HUD”), as adjusted for family size appropriate to the size and number of bedrooms in the respective HOME Restricted Unit, provided however that if the tenant is paying for utilities and services for the HOME Restricted Unit, the rent shall not exceed the maximum amount calculated as set forth in this subdivision minus a monthly allowance for utilities and services as set forth in the maximum monthly allowances for utilities and services established and updated annually by the Agency pursuant to 24 CFR §92.252(d). b. Very Low-Income Units shall be rented for amounts that do not exceed thirty percent of fifty-percent (50%) of the Median Income as adjusted for family size appropriate to the size and number of bedrooms in the respective HOME Restricted Unit, provided however that if the tenant is paying for utilities and services for the HOME Restricted Unit, the rent shall not exceed the maximum amount calculated as set forth in this subdivision minus a monthly allowance for utilities and services as set forth in the maximum monthly allowances for utilities and services establishe d and updated annually by the Agency pursuant to 24 CFR §92.252(d).
c. Notwithstanding any other provision, the maximum rent on any HOME -Restricted Unit shall not exceed the “Fair Market Rent” as established by HUD under 24 CFR §888.111. d. Unless Owner has obta ined prior written Agency authorization, Owner shall maintain the allocation of HOME-Restricted Units by the bedroom sizes stated in the Regulatory Agreement. e. Such maximum rent limits shall be recalculated periodically after HUD determination of the Fair M arket Rent or the Median Income; provided, however, that the rents are not required to be lower than the initial rent for the HOME- Restricted Units. Owner shall give tenants not less than thirty (30) days’ notice of a change in rents. f. The Agency shall review and approve rents proposed by Owner for the HOME Restricted Units, subject to the maximum rent limitations as set forth in section 6(a), (b) and (c) of this Agreement. The Agency will provide Owner with information on updated HOME rent limits. Owner must annually provide the Agency with information on rents and occupancy of HOME Restricted Units to demonstrate compliance with this Section 6. The Agency must review rents for compliance and approve or disapprove them every year.
g. The foregoing affordability requirements may, with the consent of the Agency, terminate on foreclosure or deed in lieu of foreclosure; provided, however, that the affordability requirements will revive according to the original terms if the Owner at the time of foreclosure, or any entity that includes such Owner or anyone with whom such Owner has or had family or business ties, obtains an ownership interest in the Project or Property.

Construction and Permanent Loan Agreement Page 59

8. Occupancy Requirements. Owner shall assure that all HOME Restricted Rental Units shall be initially occupied by households earning less than sixty -five percent (65%) of the Median Income, as verified by the Agency. Notwithstanding any other provision, if five or more units in the Project are HOME -Restricted Units, not less than twenty percent of the HOME-Restricted Units shall be Very Low -Income Units and shall be occupied by families whose annual income does not exceed fifty-percent (50%) of the Median Income. If a tenant of a HOME-Restricted Unit no longer qualifies as for the HOME-Restricted Unit as a result of an increase in family income, the HOME -Restricted Unit continues to qualify under these Funding Requirements so long as actions satisfactory to HUD are being taken t o ensure that all vacancies are filled in accordance with these Funding Requirements until the noncompliance is corrected. Such tenants shall pay as rent the lesser of the amount payable by the tenant under State or local law or thirty percent (30%) of th e family’s adjusted income, except that tenants of HOME -assisted units that have been allocated low -income housing tax credits by a housing credit agency pursuant to section 42 of the Internal Revenue Code of 1986 (26 USC Section 42) must pay rent governed by such section.

In addition, for projects where HOME units are designated as floating pursuant to 24 CFR §92.252(j), tenants who no longer qualify as low-income are not required to pay as rent an amount that exceeds the market rent for comparable, unassisted units in the neighborhood. If the HOME -Restricted Units are not occupied by eligible tenants within six months following the date of Project completion, Owner shall, in accordance with the requirements of 24 CFR §92.252, submit marketing information to Agency and to HUD and, if appropriate, submit a marketing plan. If any HOME-Restricted Unit has not been rented to eligible tenants 18 months after the date of project completion, Owner shall repay the HOME funds invested in such HOME-Restricted Unit to HUD.

9. Income Verification. Owner shall fully cooperate with Agency by requiring every prospective tenant of a HOME Restricted Unit to provide to Owner, prior to initial occupancy of a H OME-Restricted Unit and annually, all information required to verif y income -eligibility of the prospective tenant to assure income eligibility in accordance with 24 CFR §

92.203. For the initial eligibility determination, Owner shall cause the tenant to provide the Agency with at least two months of source documents evid encing annual income (by way of example, wage statement, interest statement, unemployment compensation statement) for the family. Thereafter, Owner shall cause the tenant to provide the Owner with such source documents; a written statement of the amount o f the family's annual income and family size, with a certification that the information is complete and accurate and assurance that the family will provide source documents upon request; or a written statement from the administrator of a government program under which the family receives benefits and which examines each year the annual income of the family, stating the tenant's family size and the amount of the family's annual income or alternatively, stating the current dollar limit for very low or low -income families for the family size of the tenant and state that the tenant's annual income does not exceed such limit.

10. Tenant Protections; Lease Provisions . Owner shall comply with the following provisions for protection of tenants in HOME-Restricted Units.
a. Owner shall enter into an initial lease with a tenant of a HOME -Restricted Unit for not less than one year, unless by mutual agreement between the tenant and the Owner and not required by Owner as a condition of entering into the lease. Such lease shall not contain any of the following provisions, in addition to any other applicable requirements of law:
i. Agreement by the tenant to be sued, to admit guilt, or to a judgment in favor of the Owner in a lawsuit brought in connection with the lease;
ii. Agreement by the tenant that the Owner may take, hold, or sell personal property of household members without notice to the tenant and a court decision on the rights of the parties; excepting an agreement by the tenant concerning disposition of personal property remaining in the housing unit after the tenant has moved out of the unit that is in accordance with State law;
iii. Agreement by the tenant not to hold the Owner or the Owner's agents legally responsible for any action or failure to act, whether intentional or negligent; iv. Agreement of the tenant that the Owner may institute a lawsuit without notice to the tenant; v. Agreement by the tenant that the Owner may evict the tenant or household members without instituting a civil court proceeding in which the tenant has the opportunity to present a defense, or before a court decision on the rights of the parties;
vi. Agreement by the tenant to waive any right to a trial by jury;

Construction and Permanent Loan Agreement Page 60
vii. Agreement by the tenant to waive the tenant's right to appeal, or to otherwise challenge in court, a court decision in connection with the lease; and
viii. Agreement by the tenant to pay attorney's fees or other legal costs, even if the tenant wins in a court proceeding by the Owner against the tenant. The tenant, however, may be obligated to pay costs if the ten ant loses. ix. Agreement by the tenant (other than a tenant in transitional housing) to accept supportive services that are offered.
b. An Owner may not terminate the tenancy or refuse to renew the lease of a tenant of rental housing assisted with HOME funds except for serious or repeated violation of the terms and conditions of the lease; for violation of applicable Federal, State, or local law; for completion of the tenancy period for transitional housing or failure to follow any required transitional housing supportive services plan; or for other good cause. Good cause does not include an increase in the tenant’s income or refusal of the tenant to purchase the housing. To terminate or refuse to renew tenancy, the Owner must serve written notice upon the tenant specifying the grounds for the action at least 30 days before the termination of tenancy. c. Owner must adopt and follow written tenant selection policies and criteria that:
i. Limit the housing to very low-income and low-income families; ii. Are reasonably related to program eligibility and the applicants' ability to perform the obligations of the lease (i.e., to pay the rent, not to damage the housing; not to interfere with the rights and quiet enjoyment of other tenants);
iii. Limit eligibility or give a preference to a particular segment of the population if required in the Loan Documents (and only if the limitation or preference is described in the Agency’s consolidated plan).

1. Any limitation or preference must not violate nondiscrimination requirements in 24 CFR §92.350. A limitation or preference does not violate nondiscrimination requirements if the housing also receives funding from a Federal program that limits eligibility to a particular segment of the population (e.g., the Housing Opportunity for Persons with AIDS program under 24 CFR Part 574, the Shelter Plus Care program under 24 CFR Part 582, the Supportive Housing program under 24 CFR Part 583, supportive housing for the elderly or persons with disabilities under 24 CFR Part 891), and the limit or preference is tailored to serve that segment of the population.

2. If the Project does not receive funding from a Federal program that limits eligibility to a particular segment of the population, the project may have a limitation or preference for persons with disabil ities who need services offered at a project only if:
a. The limitation or preference is limited to the population of families (including individuals) with disabilities that significantly interfere with their ability to obtain and maintain housing; b. Such families will not be able to obtain or maintain themselves in housing without appropriate supportive services; and
c. Such services cannot be provided in a non-segregated setting. The families must not be required to accept the services offered at the Project . In advertising the Project, Owner may advertise the Project as offering services for a particular type of disability; however, the Project must be open to all otherwise eligible persons wi th disabilities who may benefit from the services provided in the Project. iv. Provide for the selection of tenants from a written waiting list in the chronological order of their application, insofar as is practicable; and
v. Give prompt written notification to any rejected applicant of the grounds for any rejection. d. Owner shall not refuse to lease a HOME -Restricted unit to a certificate or voucher holder under 24 CFR Part 982 – Section 8 Tenant -Based Assistance: Unified Rule for Tenant -Based Assistance under the Section 8 Rental Certificate Program and the Section 8 Rental Vou cher Program or to the holder of a comparable document evidencing participation in a HOME tenant -based rental assistance program because of the status of the tenant as a holder of such certificate, voucher or comparable certification.

Construction and Permanent Loan Agreement Page 61

11. Unit Quality & Determination of Cost Allocation. OWNER shall assure that HOME Restricted Units assisted with HOME Funds must be comparable in size and amenities to other units in the Project. If the assisted and non -assisted units are comparable in terms of size, features an d number of bedrooms, the actual cost of the HOME Restricted units can be determined by pro -rating the total HOME eligible development costs of the Project so that the proportion of the total development costs charged to the HOME program does not exceed th e proportion of the HOME Restricted units in the Project. If the assisted and non-assisted units are not comparable, the actual costs may be determined based on a method of cost allocation.

12. Compliance With Loan Documents . Owner shall comply with any and all applicable provisions of the Loan Agreement for so long as they continue to be in effect.

13. Repayment On Default Or Early Termination . If the Agency determines the Project does not comply with HOME requirements for affordability as specified in 24 CFR §§ 92.252 or 92.254; or if the Project is terminated before completion, either voluntarily or otherwise; or if Owner does not comply with these funding restrictions; or if the Project is determined to be an ineligible activity under HOME, Owner must repay to Agency any HOME Funds invested in the Project upon demand.

14. Program Income. If Project income is considered to be HOME program income, it shall nevertheless be paid to or retained by Owner in accordance with the agreement between Agency and Owner.

15. Administrative Requirements . Owners that are governmental or non -profit organizations shall comply with the provisions of 24 CFR §92.505 regarding uniform administrative requirements. Owner shall cooperate fully with the Agency and provide all documents and records required by Agency in preparing for HOME related audits. Owner shall comply with all applicable requirements under HOME, including without limitation, recordkeeping and reporting.

16. Governmental Entities, Non-Profits, CHDOS. Special HOME regulations apply to an Owner that is governmental or non-profit entities or a community housing development organization. Such Owner is responsible for knowledge of and shall fully comply with such regulations.

17. Term. These covenants shall burden and regulate the HOME Restricted Units assisted with HOME Funds for the following term as applicable, unless a longer term is specified in the body of the document to which this attached:
a. For rehabilitation or acquisition of existing housing, five (5) years if the subsidy for each of HOME - Restricted Unit is less than $15,000;
b. For ten (10) years if such subsidy is $15,000 or more but not more than $40,000; c. For fifteen (15) years if such subsidy is more than $40,000 or if the project involves refinancing of an existing loan; and
d. For new construction or acquisition of newly constructed housing, twenty (20) years.

18. No Termination On Recapture. Notwithstanding any other provisions of the Regulatory Agreement, the provisions of these HOME Funding and Other Federal Requirements shall continue for the duration of the applicable preceding term.

Construction and Permanent Loan Agreement Page 62
EXHIBIT 3

Compliance Violations and Actions

COMPLIANCE VIOLATIONS AND ACTIONS
(All payments due and payable within 30-days of assessment)

Tenant Eligibility and Affordability Violations
Compliance
Violation
Fees and Actions* Corrective Time Period
Tenants over income
at
initial move-in
Initial $500 per unit, again every 90 days
until another income qualified tenant is
housed.

Correction: Evict tenant if tenant fraud.

Otherwise, next available unit must be
Affordable and rented to an Income-
Qualified tenant.
90 days from discovery date to avoid additional
$500 charge every 90-days the problem is not
corrected.

Incorrect eligibility
documentation
Initial $50 per file for incorrect
calculations, verifications, or required
documents. Additional $50 per month if
not corrected.

Correction: Submit copies of corrections
to compliance staff as applicable.
30 days from discovery date to submit copies of
corrections to compliance staff to avoid additional
$50 per month if not corrected
Failure to complete
annual
recertifications
Initial $250 for each incomplete file.

Additional $50 per month if not corrected.

Correction: Submit copies of
recertifications to compliance staff.
30 days from discovery date to submit corrections
to avoid additional $50 per month if not
corrected.

Failure to maintain
tenant eligibility
records
Initial $500 per unit, again every 90-days
thereafter until new records in place.

Additional $100 per unit per month the
project remains out of compliance.

Correction: Immediately establish new
files/records.
30 days from discovery date to submit copies of
new records to avoid additional $100 per unit per
month the project remains out of compliance.

Incorrect Rents Reimbursement to tenant of the entire
amount overcharged. $100 payment to
Agency for each over-charged unit.

Correction: Refund tenant with letter of
correction.
30 days from discovery date to avoid additional
$100 per overcharged unit per month fee to
Agency.

Failure to submit
complete and
accurate monthly
Bond Report by due
date
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
7 days from discovery date to submit complete
and accurate report to avoid additional $100 per
day charge.

Failure to comply
with approved
Management Plan
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
30 days from discovery date to submit corrections
to avoid additional $100 per day charge.

Failure to submit
complete and
accurate quarterly
Resident Services
report by due date
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
7 days from discovery date to submit corrections
to avoid additional $100 per day charge.

Failure to provide a
resident service
required by Resident
Services Plan
Initial $250 per service. Additional $100
per day until service is provided.

Correction: Implement required service or
7 days from discovery date to implement required
service or provide new resident services plan to
avoid additional $100 per day charge; 30 days

Construction and Permanent Loan Agreement Page 63
new resident services plan submitted and
approved; approved plan implemented.
from discovery date to implement new plan to
avoid additional $100 per day charge.

Noncompliant lease $100 per noncompliant lease.

Correction: Prepare and execute approved
lease or addendum to address the
deficiency.
30 days from discovery date to avoid additional
$100 per noncompliant lease per month charge to
Agency.

Housing Quality Standards Violations
Compliance
Violation
Fees and Actions* Corrective Time Period
Verifiable existence
of Toxic Mold
$200 per unit. Additional $75 per day
charge each time efforts fall outside of
corrective timeframes.

Correction: Prepare and submit action plan
that addresses scope of work and timetable
to complete. Relocate tenant if necessary.

Obtain certified clearance that mold has
been abated and unit is safe to occupy
once again.
3-days from discovery date to submit action plan
to address. 10-days to relocate tenant if necessary.
30-days to obtain certification that unit is mold
free. $75 per day additional charge each time
efforts fall outside of these timeframes.

Broken pipes and
plumbing facilities
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Repair/replace as necessary
7-days from discovery date to avoid additional
$75 per day each day thereafter corrective action
not taken.

Smoke detectors not
working in the units
$200 per unit with non-functional smoke
detector. Additional $75 charge per day if
not corrected.

Correction: Replace batteries or non-
working unit within 24 hours.

Within 24 hours of discovery date to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Windows with large
cracks or missing
glass
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Infestation of roaches
or vermin
$200 per infested unit. Additional $75
charge per day if not corrected.

Correction: Letter from pest control
company verifying removal of pests with
paid invoice to compliance staff.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Non-working heating
unit (Winter) or air
conditioning unit
(Summer)
$500 per nonworking unit. Additional $75
charge per day if not corrected. $75 re-
inspection fee if necessary to verify
problem corrected.

Correction: Repair/replace as necessary.

Within 24 hours of discovery date to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Excessive amount
of urine/ feces
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Clean unit as necessary and
address problem as the lease allows.

Submit correction letter with
documentation to compliance staff.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Excessive amount of
trash/garbage in the
unit
$75 per unit. Additional $75 charge per
day if not corrected.

Correction: Clean unit and send letter of
correction to compliance staff.
14-days from date of discovery to avoid an
additional $75 per day thereafter each day
corrective action not taken.

Hazardous exterior
conditions
$500 for hazardous conditions. Additional
$75 charge per day if not corrected. $75
re-inspection fee.

Correction: Clean and/or repair as
necessary. Re-inspection to verify problem
addressed.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Construction and Permanent Loan Agreement Page 64
Large holes
walls/ceiling
$100 per unit. Additional $75 charge per
day if not corrected.

Correction: Submit correction letter with
documentation to compliance staff.
30-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Non-Operable
Security Gate
$500 per non-working gate. Additional
$75 charge per day if not corrected. $75
re-inspection fee if necessary to verify
problem corrected.

Correction: Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

No Security Cameras
(if cameras required)
$250 per discovery. Additional $75
charge per day if not corrected. $75 re-
inspection charge to verify problem
corrected.

Correction: Replace cameras.
30-days from the date of discovery to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Non-working
Security Cameras
$100 per camera per discovery.

Additional $75 charge per day if not
corrected. $75 re-inspection charge to
verify problem corrected. Correction:

Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Non-working or non-
accessible
amenities/services
$100 per item per discovery. Additional
$75 charge per day if not corrected. $75
re-inspection charge to verify problem
corrected. Correction: Repair/replace as
necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

* No compliance fee will be assessed for one incident of each type of compliance violation per annual inspection provided the violation is corrected within the specified corrective time period. The second and subsequent violations will be assessed compliance fees as detailed in the Tenant Eligibility and Affordability Violations and Housing Quality Standards Violat ions tables.

Construction and Permanent Loan Agreement Page 65
Exhibit 6: HTF and MIHF Regulatory Agreement
NO FEE DOCUMENT:

Entitled to free recording
per Government Code §§6103 & 27383.

When recorded, return to:

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY
801 12th Street, 4th Floor
Sacramento, CA 95814
Attn: Portfolio Management

HTF AND MIHF REGULATORY AGREEMENT FOR RESIDENTIAL RENTAL PROPERTY

AND DECLARATION OF RESTRICTIVE COVENANTS AFFECTING REAL PROPERTY

PROJECT NAME: On Broadway Apartments
PROJECT ADDRESS: 1901 Broadway Sacramento, Ca 95818
APN: APN: 01002130080000

FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT OF WHICH IS ACKNOWLEDGED, AGENCY AND OWNER HAVE

ENTERED THIS REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS AFFECTING REAL PROPERTY (REGULATORY AGREEMENT) AS OF THE EFFECTIVE DATE.

1. GENERAL. This Regulatory Agreement includes the Exhibits listed below which are attached to and incorporated in this Regulatory Agreement by this reference.

2. DEFINITIONS. The capitalized terms in this Regulatory Agreement shall have the meanings assigned in the following table and in the body of this Regulatory Agreement as the context indicates. Terms being defined are indicated by quotation marks.

TERM DEFINITION
“Effective Date” This Regulatory Agreement shall be effective as of the following date: May 1, 2023 “Agency” Sacramento Housing and Redevelopment Agency
a joint powers agency.
“Agency Address” Agency’s business address is 801 12th Street, Sacramento, California 95814 “Owner” Broadway Station, L.P.
“Owner Address” Owner’s business address is as follows: 22 Pelican Way, San Rafael, CA 94901 “Jurisdiction” City of Sacramento
“Property”
That certain real property which is subject to this Regulatory Agreement as further described in the legal description, attached as Exhibit 1 – Legal Description of the Property and incorporated in this Regulatory Agreement by this reference
“Funding
Agreement”
The Funding Agreement between
Agency and Owner as follows:

Titled: Construction and Permanent Loan
Agreement
Dated: May 1, 2023
“Agency Funding” Agency Funding made by Agency to Owner under the Funding Agreement for development of the Property
“Agency Funding
Amount“
The amount of Agency Funding, as follows from (HTF and MIHF Funds):
$1,600,000.00
“Funding
Requirements”
The legal restrictions on the use of the funds that Agency has used to make Agency Funding, as applicable to and restricting t he Property. The Funding Requirements are set out in Exhibit 2 – Funding Requirements.
“Approved Use” The only permitted use of the Property, which is as a residential property available for rent by the general public and containing not less than the following number of units:
140

3. RESTRICTED PARCELS; APPROVAL OF LEASES. In order to assure that the proper number and types of units have been rented in accordance with this Regulatory Agreement, Owner is prohibited from leasing any Unit within the Proj ect until either the parties have recorded against the Property a list of the Restricted Units or Agency has approved the individual lease or lease form for the Restricted Units. The following numbers of units are restricted for each respective funding source. The

Construction and Permanent Loan Agreement Page 66
initial rents for the Restricted Units shall be the following; provided, however, that upon the request of Owner, Owner and Agency may agree to a schedule for the Restricted Units that complies with the following affordability requirements as of the date when the Project is available for occupancy. In any event the rents for the Restricted Units may be adjusted not more often than annually. The rents shall include allowance for utilities and costs reasonably related to the rental of the Restrictive Units, as may be required in determining the rents for the applicable funding sources. Only Restrictive Units indicated under Agency Funding Source are assisted by Agency. Nevertheless, Owner shall assure the affordability of all of the following Restrictive Units at the named affordability levels. Additionally, higher rents may be charged for Restrictive Units subject to U.S. Department of Housing and Urban Development Housing Assistance Payment Vouchers, provided that the actual rents paid by the tenants do not exceed the applicable rent for the affordability levels for the respective units.

4. Notwithstanding any conflicting provision in the Funding Requirements, the Initial Rent per Unit per Month listed in this Regulatory Agreement shall be paramount and controlling.

Agency Funding
Source: Affordability Level: Number of
Units: Restricted Units:

Initial Rent
per Unit per
Month:

HTF

60% 4

1-Bedroom $1,216.50
HTF 60% 1 2-Bedroom $1,368.00
MIHF 80% 2 2-Bedroom $1,823.75
MIHF 80% 1 3-Bedroom $2,026.25
Total Restricted
Units
8 5. MANAGEMENT AGREEMENT. Owner agrees that at all times the Project shall be managed by a property manager (i) approved by Agency in its reasonable discretion and (ii) who has successfully managed at least five projects over forty units in size and subject to a recorded regulatory agreement for at least three years’ prior to the application, without any record of material violations of discrimination restrictions or other state or federal laws or regulations or l ocal governmental requirements applicable to such projects (the “Manager”). Owner shall submit to Agency from time to time such information about the background, experience and financial condition of any existing or proposed Manager as Agency may reasonab ly require to determine whether such Manager meets the requirements for a Manager set forth herein. Agency reserves the right to conduct periodic reviews of the management practices and of the Manager to determine if the Project is being operated and managed in accordance with the requirements and standards of this Regulatory Agreement and the Funding Agreement.

Owner agrees to cooperate with Agency in such reviews.

If Agency determines in its reasonable judgment that the Project is not being operated an d managed in accordance with one or more of the requirements or standards of the Funding Agreement, Agency may deliver notice to Owner requesting replacement of the Manager, which notice shall state clearly the reasons for such request. Owner agrees that, upon receipt of such notice, Owner shall within 60 days submit to Agency, a proposal to engage a new Manager meeting the requirements of this provision. Agency shall respond within 30 days to such proposal or such approval shall be deemed given. Upon receipt of such consent or deemed consent, Owner shall promptly terminate the existing Manager’s engagement and engage the new Manager.

Owner shall not enter into any management agreement or arrangement with any party with respect to the management of the Project without Agency's prior written consent, such consent not to be unreasonably withheld or delayed. Owner shall not materially modify, amend or terminate any approved management agreement (other than as required to comply with the terms of the Funding A greement and/or applicable law) without Agency's prior written consent, which consent will not be unreasonably withheld or delayed; provided, however, that such consent shall not be required to extend the term of an existing management agreement.

Approved Management Company
EAH Inc.

6. SPECIAL PROVISIONS. Owner shall also comply with the following special provisions.

Construction and Permanent Loan Agreement Page 67

ANNUAL ADMINISTRATIVE FEE. Borrower agrees to pay an annual administrative fee (“Fee”) to Lender as compensation for monitoring compliance with regulatory restrictions and the administration of the Loan. Borrower shall pay annually a Fee equal to $25,000. Fee payments shall commence on the Closing Date for the prorated semiannual period from the Closing Date to and including Octo ber 31, 2023, and in equal semiannual installments in advance on each May 1 and October 1 of each year thereafter throughout the term of the Regulatory Agreement.

7. REPRESENTATIONS. Agency has provided Agency Funding to Owner to develop the Property, subject to the terms of the Funding Agreement. For purposes of this Section 7, “Property” shall mean Property or Restricted Unit as the context may indicate. This Regulatory Agreement is a substantial part of the consideration to Agency for making Agency Funding. The funds used by Agency under the Funding Agreement are funds from public funding sources administered by Agency and their use is subject to certain requirements some of which are embodied in this Regulatory Agreement. Further, Agency has made Agency Funding in accordance with the laws, rules and regulations to which Agency is subject. Therefore, Agency has made Agency Funding conditioned upon Owner’s agreement, for itself and its successors and assigns, to comply with all provisions of this Regulatory Agreement, including without limitation, the Funding Agreement. Owner represents that it has had full opportunity to make itself independently familiar with such limitations and restrictions, and Owner accepts them and agrees to comply fully with them.

8. COVENANTS. Owner makes the following covenants. Unless Owner has received the prior written consent or Agency approval otherwise, Owner shall fully comply with each and every covenant. Except as otherwise stated in this Regulatory Agreement, the following covenants shall have a term that is the same as the longest term specified in the Funding Requirements.

a. Owner shall use and permit others to use the Property only for the Approved Use.

b. Owner shall ensure full compliance with the Funding Requirements.

c. Owner shall not convey, transfer, hypothecate, or otherwise encumber any of the Property or permit the conveyance, transfer, hypothecation, or encumbrance of the Property unl ess such assignee, transferee, beneficiary, or encumbrancer has agreed, in writing and in a form suitable for recordation, to be bound by the terms of this Regulatory Agreement.

d. Owner shall not cause and shall not permit expansion, reconstruction, or demo lition of any part of improvements on the Property, except as provided by the Funding Agreement.

e. Owner shall maintain the Property and all building improvements, grounds and equipment of the Property in good repair and condition and in compliance with all applicable housing quality standards and local code requirements. Owner shall maintain the Property in good condition and shall keep the Property reasonably free from graffiti and unrepaired vandalism and from accumulation of abandoned property, inoperable vehicles, unenclosed storage, debris, waste materials, and hazardous substances. In the event of a casualty loss, Owner shall cause the restoration or replacement of the Property, in a timely manner and provided that such restoration or replacement is then economically feasible.

f. Owner shall not cause and shall not permit discrimination based on race, color, national origin, religion, sexual orientation, gender, familial status, age or disability in the sale, lease, or rental or in the use or occupancy o f the Property.

Owner covenants by and for him/her/itself, his/her/its heirs, executors, administrators, and assigns, and all persons claimin g under or through them that there shall be no discrimination against or segregation with reference to the selectio n, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. This covenant against discrimination shall continue in perpetuity.

g. Owner shall not evict, refuse to rent to, or otherwise treat someone differently because of that person’s status as a victim of domestic violence, dating violence, sexual assault, or stalking, in compliance with the Violence Against Women Act. This protection is available regardless of sex, gender identity, or sexual orientation.

h. Owner shall ensure compliance with the obligations imposed by the federal Personal Responsibility and Work Opportunity Act (Public Law 104-193, commonly known as the Welfare Reform Act) as amended by California Welfare and Institutions Code Section 1785 1, which restrict Agency funding of federal, state or local benefits to persons who are not citizens or qualified aliens as defined in such act.

Construction and Permanent Loan Agreement Page 68
i. Owner shall provide Agency with a detailed resident services plan including but not limited to the following information: (1) identification of all entities responsible for providing resident services to Project tenants and each entity ’s role in the provision of those services; (2) a description of the services to be provided; (3) a resident services budget and proforma; and (4) Agency approved resident services at the Project according to the following minimum schedule of sixty (60) hours per week:

1) Coordinator: four (6) hours per week
2) After School programming ten (10) hours per week (two hours per day and five da ys per week, minimum) 3) Additional Programming: balance of forty-four (44) hours per week shall include the following:
a) Workforce development support and activities
b) educational classes such as nutrition, exercise, health resources, health insurance application assistance, annual onsite health fair, English as a Second Language (ESL) classes. c) Socialization activities such as bingo, gardening and community building eve nts; and d) Other services such as case management, planned recreation, transportation assistance, counseling assistance and employee readiness and job search assistance.

j. Owner shall not pass utility charges paid by Owner, including water, sewer, and garbage collection charges, through to tenants as an add-on to their contracted rent subject to adjustments permitted by applicable utility allowances.

k. Owner shall not make payment of rental insurance premiums a condition of occupancy. If Owner requires renters ’ insurance, the policy premium must be deducted from the tenant’s rent. Owner shall not add the insurance premium to the tenant’s rent in either the initial or subsequent years.

l. Owner shall make all of the units, indoor common areas and buildings smoke free.

9. NATURE OF COVENANTS. The provisions contained in this Regulatory Agreement are covenants which subject and burden the Property, as covenants running with the land. It is intended and agreed that the agreements and covenants provided in this Agreement shall be covenants running with the land and equitable servitudes on the land and that they shall, in any event, and without regard to technical classifications or designation, be binding, to the fullest extent permitted by law and equity , for the benefit and in favor of, and enforceable by, Agency, Agency's successors and assigns, any other governmental entity acting within its authority and any successor in interest to Agency's interest under this Regulatory Agreement against Owner, its successors and assigns and every successor in interest to all or any part of the Property.

10. TERM. The term of this Regulatory Agreement shall commence on the Effective Date and continue until the terms of all of the covenants, including without limitation, the terms stated in the Funding Requirements, have expired or otherwise been terminated. Notwithstanding the term in the Funding Requirements, the term of this Regulatory Agreement shall be Thirty (30) years from the Effective Date.

11. EXPIRATION OF AFFORDABILITY PERIOD. Owner agrees the rent of "in-place” tenants at the conclusion of the Term will continue to be governed by the applicable affordability restrictions, so long as those tenants continue to live in the development.

12. MULTIPLE FUNDING REQUIREMENTS. If more than one form of Funding Requirements is attached, each Restricted Unit shall be subject to the Funding Requirements for every Funding Source applied to the respective Restricted Unit. If the terms of the Funding Requirements shall conflict as to any Restric ted Unit, the Funding Requirements shall be construed so as to meet all applicable requirements for the respective Restricted Unit, including without limitation the use of the most restrictive requirements and the use of the “Recapture” formula that results in the greatest repayment to Agency.

13. RECORDKEEPING AND REPORTING. Upon request of Agency, Owner shall promptly provide any additional information or documentation requested in writing by Agency to verify Owner's compliance with the provisions of this Re gulatory Agreement. At the written request of Agency, Owner shall, within a reasonable time following receipt of such request, furnish reports and shall give specific answers to questions upon which information is desired from time to time relative to the income, assets, liabilities, contracts, operations, and condition of the property and the status of any deeds of trust encumbering the Property.

14. AUDIT AND INSPECTION. The Property and all related equipment, buildings, plans, offices, books, contracts, re cords, documents and other related papers shall at all times be maintained in reasonable condition for audit and shall be subject to examination by Agency or its agents. The books and accounts of the operations of the Property shall be kept in accordance

Construction and Permanent Loan Agreement Page 69
with generally accepted accounting principles. Owner shall provide Agency access to the Property and its tenants during reasonable hours for the purpose of reviewing Owner’s compliance with this Regulatory Agreement.

15. INDEMNITY FOR OWNER’S FAILURE TO MEET LEGAL REQUIREMENTS. Owner shall indemnify and hold Agency, its officers, directors, and employees harmless from any and all liability arising from Owner’s failure to comply with the covenants, conditions and restrictions contained in this Regulatory Agre ement or to comply with all other laws, rules, regulations and restrictions related to the use of Agency Funding. Without limitation, such indemnity shall include repayment to the appropriate parties of rents or sales proceeds in excess of amounts authoriz ed to be charged and repayment to Agency of the costs of funds and the value of lost opportunities resulting from the required repayment by Agency to the funding source of funds improperly used.

16. CHANGES WITHOUT CONSENT OTHERS. Only Agency and its succes sors and assigns, and Owner (subject to the reasonable approval of Owner's lender and investor limited partner) shall have the right to consent and agree to changes in, or to eliminate in whole or in part, any of the covenants or restrictions contained in this Regulatory Agreement without the consent of any easement holder, licensee, other mortgagee, trustee, beneficiary under a deed of trust or any other person or entity having any interest less than a fee in the Property.

17. DEFAULT. Upon a breach of any o f the provisions of this Regulatory Agreement by Owner, Agency may give written notice of such breach to Owner by registered or certified mail. If such violation is not corrected to the satisfaction of Agency within thirty (30) days after the date such no tice is mailed or within such further time as Agency may determine in its sole and absolute discretion is necessary to correct the breach, and without further notice to Owner, Agency may declare a default under this Agreement, effective on the date of such declaration of default, and upon such default Agency may: (a) take any action then available under the Funding Agreement for a default under the Funding Agreement; (b) apply to any court for specific performance of this Regulatory Agreement, (c) apply to any court for an injunction against any violation of this Agreement; (d) apply to any court for the appointment of a receiver to take over and operate the Property in accordance with the terms of this Regulatory Agreement, (e) apply to any court for money damages; or (f) apply to any court or other tribunal for such other relief as may be appropriate. The parties agree the injury to Agency arising from a default under any of the terms in this Regulatory Agreement would be irreparable, and the amount of damage would be difficult to ascertain. A copy of any notice sent to Owner will be sent to Owner’s investor limited partner at the following address: Wells Fargo Affordable Housing Corp., 550 S. Tryon Street, 23 rd Floor, D1086-239, Charlotte, NC 28202 -4200, Attention: Director of Tax Credit Asset Management; provided, however, that failure by Agency to deliver such notice to Owner’s investor limited partner shall not impair Agency’s rights in any way. Such investor limited partner shall have the right, but not the obligation, to cure any default of the Owner on the same terms as Owners.

18. REGULATORY AGREEMENT VIOLATIONS. Owner shall pay the program compliance fees and expenses to Agency set forth in Compliance Violations and Actions (Exhibit 3 - Compliance Violations and Actions) in reimbursement of the amounts and time expended by Agency to insure Owner’s compliance with State statutes and federal regulations and Owner’s obligations under this Regulatory Agreement as a result of Owner not meeting its obligations and reporting requirements. No compliance fee will be assessed for one incident of each type of compliance violation per annual inspection provided the violation is corrected within the specified corrective time period. The second and subsequent vio lations will be assessed compliance fees as detailed in the Compliance Violations and Actions tables.

19. BINDING SUCCESSORS IN INTEREST. This Regulatory Agreement shall bind and the benefits shall inure to Owner, its successors in interest and assigns, and to Agency and its successors for the term of this Regulatory Agreement.

20. CONTRADICTORY AGREEMENTS. Owner warrants that it has not, and will not, execute any other agreement with provisions contradictory of or in opposition to, the provisions of this Regul atory Agreement, and that, in any event, to the extent permitted by law, the requirements of this Regulatory Agreement are paramount and controlling as to the rights and obligations set forth and supersede any other requirements in conflict with this Regul atory Agreement.

21. COMPLIANCE AMENDMENTS. If revisions to the provisions of this Regulatory Agreement are necessitated to comply with the laws or regulations governing Agency Funding, Owner agrees to execute modifications to this Regulatory Agreement that are needed to comply with such laws or regulations.

22. ATTORNEYS' FEES. If the services of any attorney are required by any party to secure the performance of this Regulatory Agreement or otherwise upon the breach of default of another party, or if any judici al remedy or mediation is necessary to enforce or interpret any provision of this Regulatory Agreement or the rights and duties of any person in relation to this Regulatory Agreement, the prevailing party shall be entitled to reasonable attorneys' fees and costs in addition to any other relief to which such party may be entitled. Any award of damages following judicial remedy or arbitration as a result of this Regulatory Agreement or any of its provisions shall include an award of prejudgment interest from the date of the breach at

Construction and Permanent Loan Agreement Page 70
the maximum amount of interest allowed by law. The prevailing party shall mean the party receiving an award in arbitration or a judgment in its favor, unless the award or judgment is less favorable than the best settlement offer ed in writing in a reasonable manner by the other party, in which case the prevailing party is the other party.

23. SEVERABILITY. The invalidity or unenforceability of any clause, part or provision of this Regulatory Agreement shall not affect the validity of the remaining portions.

24. ELECTION OF REMEDIES. To the extent applicable, in the event of any breach of any covenant, condition or restriction contained in this Regulatory Agreement, Agency shall reasonably endeavor to remedy such breach by conference a nd conciliation. If, in the opinion of Agency, Agency and Owner are unable mutually to agree upon a suitable remedy or the circumstances so warrant, such breach may be enjoined or abated by appropriate proceedings brought by Agency.

Agency may institute or prosecute in its own name, any suit Agency may consider advisable in order to compel performance of any obligation of any owner to develop and maintain the subject property in conformity with this Regulatory Agreement and to remedy any default of this R egulatory Agreement. Agency may also seek a decree requiring removal of any improvements constructed on the Property which improvements are designed for uses not permitted under this Regulatory Agreement and which improvements are unsuitable only for uses not permitted under this Regulatory Agreement.

The remedies of Agency under this Regulatory Agreement are cumulative, and the exercise of one or more of such remedies, including, without limitation, remedies under the Funding Agreement shall not be deemed an election of remedies and shall not preclude the exercise by Agency of any one or more of its other remedies.

25. NO WAIVER. No waiver by Agency of any breach of or default under this Regulatory Agreement shall be deemed to be a waiver of any other or subsequent breach or default.

26. NOTICES. Written notices and other written communications by and between the parties shall be addressed to Owner at Owner’s Address and to Agency at Agency Address or such other address as each respective party has designated by written notice to the other party.

Construction and Permanent Loan Agreement Page 71
THE PARTIES HAVE EXECUTED THIS REGULATORY AGREEMENT in Sacramento, California as of the Effective Date

BROADWAY STATION, L.P, a California limited partnership

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Construction and Permanent Loan Agreement Page 72
THE PARTIES HAVE EXECUTED THIS REGULATORY AGREEMENT in Sacramento, California as of the Effective Date

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY,

A JOINT POWERS AGENCY

By: _______________________________________
La Shelle Dozier, Executive Director

Approved as to form:

___________________________________________
Agency Counsel

Construction and Permanent Loan Agreement Page 73
EXHIBIT 1

Legal Description

The land referred to in this Report is situated in the County of Sacramento, City of Sacramento, State of California, and is described as follows:

PARCEL ONE:

LOTS 1, 2, 7 AND 8, IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF.

PARCEL TWO:

ALL THAT PORTION OF THAT CERTAIN ALLEY IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF, PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING AT THE SOUTHWESTERLY CORNER OF LOT 1 OF SAID BLOCK, SAID CORNER BEING AT THE INTERSECTION OF THE EASTERLY LINE OF 19TH STREET AND THE NORTHEASTERLY LINE OF SAID ALLEY; THENCE SOUTHEASTERLY 151 FEET, ALONG THE SOUTHWESTERLY LINE OF SAID LOT AND LOT 2 OF SAID BLOCK; THENCE SOUTHERLY IN A DIRECT LINE ACROSS SAID ALLEY TO THE NORTHEASTERLY CORNER OF LOT 7 OF SAID BLOCK, SAID CORNER BEING LOCATED ON THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; THENCE NORTHWESTERLY 160 FEET, ALONG THE NORTHEASTERLY LINE OF SAID LOTS 7 AND 8, IN SAID BLOCK, AND THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; TO THE NORTHWESTERLY CORNER OF SAID LOT 8, LOCATED ON THE EASTERLY BOUNDARY LINE OF SAID 19TH STREET; THENCE NORTHEASTERLY 20 FEET ALONG SAID EASTERLY BOUNDARY LINE OF 19TH STREET, TO THE POINT OF BEGINNING.

APN: 010-0213-008

Construction and Permanent Loan Agreement Page 74
EXHIBIT 2
Funding Requirements

HTF FUNDING REQUIREMENTS
HOUSING TRUST FUND – CITY OF SACRAMENTO

FINANCING FOR RESIDENTIAL RENTAL PROPERTY

These “HTF Funding Requirements” are attached to a Regulatory Agreement, and are incorporated in that Regulatory Agreement. In turn, the Regulatory Agreement is incorporated in the Loan that is described in the Regulatory Agreement.

The capitalized terms used in these HTF Funding Requirements shall have the meanings below in the body of the these HTF Funding Requirements. Terms being defined are indicated by quotation marks. Capitalized terms in these HTF Funding Requirements that are not defined below are defined in the Regulatory Agreement.

1. RECITALS. The Loan is funded by the Agency with proceeds of the Housing Trust Fund (“HTF”)of the City of Sacramento. The Agency has approved the Loan on condition that the property securing the Loan (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with the HTF (“HTF-Assisted Units”) by recordation of these HTF Funding Restrictions as covenants running with the land. The Project has been determined to be within a seven mile distance from the non-residential projects generating the funds or has access to existing or planned public transit such that it is reasonable that tenants of the Project could commute from the Project t o the non-residential projects generating the funds. The Project conforms to any City “Fair Share” plan currently adopted and in effect. HTF-Assisted Units are made affordable by such regulation to persons and households that qualify as low - income or very low-income as indicated in the table in Article I of the Regulatory Agreement. The development of the Project will benefit the Project Area because the Project will provide housing for persons who work within the Project Area. The Project is located within the City of Sacramento (“City”). Most Project Area w orkers live outside of the Project Area and come from throughout the City, including the vicinity of the Property.

2. AFFORDABILITY REQUIREMENTS. Owner shall assure that all of the HTF-Assisted Units assisted with HTF funds shall be rented at or below the following rates:

a. Low-Income Units shall be rented for not more than thirty percent (30%) of sixty percent (60%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development, as adjusted for family size appropriate to the size and number of bedrooms in the respective HTF-Assisted Unit.

b. Very Low-Income Units shall be rented for not more than thirty percent (30%) of fifty percent (50%) of the Median Income as adjusted for family size appropriate to the size and number of bedrooms in the respective HTF -Assisted Unit.

c. Unless Owner has obtained prior written Agency authorization, Owner shall maintain the allocation of HTF -Assisted Units by the bedroom sizes stated in the Regulatory Agreement.

d. Owner shall be responsible to determine the affordable rents for the HTF-Assisted Units. Within ten (10) days of Owner request, Agency shall provide all information necessary for Owner to compute such affordable rents an d will assist Owner in determining such rents.

2. OCCUPANCY REQUIREMENTS. Owner shall assure that all HTF-Assisted Units shall be occupied by households earning less than eighty percent (80%) of Median Income.

3. UNIT QUALITY. Owner shall assure that Assisted Units assisted with HTF funds must be comparable in size and amenities to other units in the Project.

4. TERM. These covenants shall burden and regulate the HTF-Assisted Units for a term of thirty (30) years.

Construction and Permanent Loan Agreement Page 75
EXHIBIT 2A
Funding Requirements

MIHO FUNDING REQUIREMENTS
MIXED INCOME HOUSING – CITY OF SACRAMENTO

FINANCING FOR RESIDENTIAL RENTAL PROPERTY

These “MIHO Funding Requirements” are attached to a Regulatory Agreement, and are incorporated in that Regulatory Agreement. In turn, the Regulatory Agreement is incorporated in the Funding Agreement that is described in the Regulatory Agreement. Capitalized terms in these MIHO Funding Requirements that are not defined below are defined in the Regulatory Agreement.

3. RECITALS. The Loan is funded by the Agency with proceeds of the housing impact fees collected pursuant to the Mixed Income Housing Ordinance (“MIHO”) of the City of Sacramento, established by Sacramento City Ordinance Number 2015- 0029. The Agency has approved the Loan on condition that the property securing the Loan (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with the MIHO (“MIHO - Restricted Units”) by recordation of these MIHO Funding Restrictions as covenants running with the land. MIHO-Restricted Units are made affordable by such regulation to persons and households that qualify as low -income as indicated herein.

4. AFFORDABILITY REQUIREMENTS. Affordability requirements are established by Sacramento City Cod e 17.712 et seq. (adopted by Resolution 2015-0294 of the City Council of Sacramento, California, on September 1, 2015). Owner shall assure that the of the MIHO Restricted Units shall be sold at or below the following rates (“Affordable Price”):

a. Low-Income Units shall be rented for amounts that do not exceed thirty percent (30%) of eighty percent (80%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development, as adjusted for family size appropriate to the size and number of bedrooms in the respective MIHO-Assisted Unit.

b. Unless Owner has obtained prior written Agency authorization, Owner shall maintain the allocation of MIHO-Assisted Units by the bedroom sizes stated in the Regulatory Agreement.

c. Owner shall be responsible to determine the affordable rents for the MIHO -Assisted Units. Within ten (10) days of Owner request, Agency shall provide all information necessary for Owner to compute such affordable rents and will assist Owner in determining such rents.

5. OCCUPANCY REQUIREMENTS. Owner shall assure that all MIHO-Assisted Units shall be occupied by households whose income does not exceed eighty percent (80%) of Median Income.

6. UNIT QUALITY. Owner shall assure that Assisted Units assisted with MIHO funds must be comparable in size and amenities to other units in the Project.

7. TERM. These covenants shall burden and regulate the MIHO-Assisted Units for a term of thirty (30) years.

Construction and Permanent Loan Agreement Page 76
EXHIBIT 3

Compliance Violations and Actions

COMPLIANCE VIOLATIONS AND ACTIONS
(All payments due and payable within 30-days of assessment)

Tenant Eligibility and Affordability Violations
Compliance
Violation
Fees and Actions* Corrective Time Period
Tenants over income
at
initial move-in
Initial $500 per unit, again every 90 days
until another income qualified tenant is
housed.

Correction: Evict tenant if tenant fraud.

Otherwise, next available unit must be
Affordable and rented to an Income-
Qualified tenant.
90 days from discovery date to avoid additional
$500 charge every 90-days the problem is not
corrected.

Incorrect eligibility
documentation
Initial $50 per file for incorrect
calculations, verifications, or required
documents. Additional $50 per month if
not corrected.

Correction: Submit copies of corrections
to compliance staff as applicable.
30 days from discovery date to submit copies of
corrections to compliance staff to avoid additional
$50 per month if not corrected
Failure to complete
annual
recertifications
Initial $250 for each incomplete file.

Additional $50 per month if not corrected.

Correction: Submit copies of
recertifications to compliance staff.
30 days from discovery date to submit corrections
to avoid additional $50 per month if not
corrected.

Failure to maintain
tenant eligibility
records
Initial $500 per unit, again every 90-days
thereafter until new records in place.

Additional $100 per unit per month the
project remains out of compliance.

Correction: Immediately establish new
files/records.
30 days from discovery date to submit copies of
new records to avoid additional $100 per unit per
month the project remains out of compliance.

Incorrect Rents Reimbursement to tenant of the entire
amount overcharged. $100 payment to
Agency for each over-charged unit.

Correction: Refund tenant with letter of
correction.
30 days from discovery date to avoid additional
$100 per overcharged unit per month fee to
Agency.

Failure to submit
complete and
accurate monthly
Bond Report by due
date
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
7 days from discovery date to submit complete
and accurate report to avoid additional $100 per
day charge.

Failure to comply
with approved
Management Plan
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
30 days from discovery date to submit corrections
to avoid additional $100 per day charge.

Failure to submit
complete and
accurate quarterly
Resident Services
report by due date
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
7 days from discovery date to submit corrections
to avoid additional $100 per day charge.

Failure to provide a
resident service
required by Resident
Services Plan
Initial $250 per service. Additional $100
per day until service is provided.

Correction: Implement required service or
7 days from discovery date to implement required
service or provide new resident services plan to
avoid additional $100 per day charge; 30 days

Construction and Permanent Loan Agreement Page 77
new resident services plan submitted and
approved; approved plan implemented.
from discovery date to implement new plan to
avoid additional $100 per day charge.

Noncompliant lease $100 per noncompliant lease.

Correction: Prepare and execute approved
lease or addendum to address the
deficiency.
30 days from discovery date to avoid additional
$100 per noncompliant lease per month charge to
Agency.

Housing Quality Standards Violations
Compliance
Violation
Fees and Actions* Corrective Time Period
Verifiable existence
of Toxic Mold
$200 per unit. Additional $75 per day
charge each time efforts fall outside of
corrective timeframes.

Correction: Prepare and submit action plan
that addresses scope of work and timetable
to complete. Relocate tenant if necessary.

Obtain certified clearance that mold has
been abated and unit is safe to occupy
once again.
3-days from discovery date to submit action plan
to address. 10-days to relocate tenant if necessary.
30-days to obtain certification that unit is mold
free. $75 per day additional charge each time
efforts fall outside of these timeframes.

Broken pipes and
plumbing facilities
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Repair/replace as necessary
7-days from discovery date to avoid additional
$75 per day each day thereafter corrective action
not taken.

Smoke detectors not
working in the units
$200 per unit with non-functional smoke
detector. Additional $75 charge per day if
not corrected.

Correction: Replace batteries or non-
working unit within 24 hours.

Within 24 hours of discovery date to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Windows with large
cracks or missing
glass
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Infestation of roaches
or vermin
$200 per infested unit. Additional $75
charge per day if not corrected.

Correction: Letter from pest control
company verifying removal of pests with
paid invoice to compliance staff.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Non-working heating
unit (Winter) or air
conditioning unit
(Summer)
$500 per nonworking unit. Additional $75
charge per day if not corrected. $75 re-
inspection fee if necessary to verify
problem corrected.

Correction: Repair/replace as necessary.

Within 24 hours of discovery date to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Excessive amount
of urine/ feces
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Clean unit as necessary and
address problem as the lease allows.

Submit correction letter with
documentation to compliance staff.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Excessive amount of
trash/garbage in the
unit
$75 per unit. Additional $75 charge per
day if not corrected.

Correction: Clean unit and send letter of
correction to compliance staff.
14-days from date of discovery to avoid an
additional $75 per day thereafter each day
corrective action not taken.

Hazardous exterior
conditions
$500 for hazardous conditions. Additional
$75 charge per day if not corrected. $75
re-inspection fee.

Correction: Clean and/or repair as
necessary. Re-inspection to verify problem
addressed.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Construction and Permanent Loan Agreement Page 78
Large holes
walls/ceiling
$100 per unit. Additional $75 charge per
day if not corrected.

Correction: Submit correction letter with
documentation to compliance staff.
30-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Non-Operable
Security Gate
$500 per non-working gate. Additional
$75 charge per day if not corrected. $75
re-inspection fee if necessary to verify
problem corrected.

Correction: Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

No Security Cameras
(if cameras required)
$250 per discovery. Additional $75
charge per day if not corrected. $75 re-
inspection charge to verify problem
corrected.

Correction: Replace cameras.
30-days from the date of discovery to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Non-working
Security Cameras
$100 per camera per discovery.

Additional $75 charge per day if not
corrected. $75 re-inspection charge to
verify problem corrected. Correction:

Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Non-working or non-
accessible
amenities/services
$100 per item per discovery. Additional
$75 charge per day if not corrected. $75
re-inspection charge to verify problem
corrected. Correction: Repair/replace as
necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

* No compliance fee will be assessed for one incident of each type of compliance violation per annual inspection provided the violation is corrected within the specified corrective time period. The second and subsequent violations will be assessed compliance fees as detailed in the Tenant Eligibility and Affordability Violations and Housing Quality Standards Violations tables.

Construction and Permanent Loan Agreement Page 79
Exhibit 7: PLHA Regulatory Agreement
NO FEE DOCUMENT:

Entitled to free recording
per Government Code §§6103 & 27383.

When recorded, return to:

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY
801 12th Street, 4th Floor
Sacramento, CA 95814
Attn: Portfolio Management

PLHA REGULATORY AGREEMENT FOR RESIDENTIAL RENTAL PROPERTY

AND DECLARATION OF RESTRICTIVE COVENANTS AFFECTING REAL PROPERTY

PROJECT NAME: On Broadway Apartments
PROJECT ADDRESS: 1901 Broadway Sacramento, Ca 95818
APN: 01002130080000

FOR GOOD AND VALUABLE CONSIDERATION, THE RECEIPT OF WHICH IS ACKNOWLEDGED, AGENCY AND OWNER HAVE

ENTERED THIS REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS AFFECTING REAL PROPERTY (REGULATORY AGREEMENT) AS OF THE EFFECTIVE DATE.

1. GENERAL. This Regulatory Agreement includes the Exhibits listed below which are attached to and incorporated in this Regulatory Agreement by this reference.

2. DEFINITIONS. The capitalized terms in this Regulatory Agreement shall have the meanings assigned in the following table and in the body of this Regulatory Agreement as the context indicates. Terms being defined are indicated by quotation marks.

TERM DEFINITION
“Effective Date” This Regulatory Agreement shall be effective as of the following date: May 1, 2023 “Agency” Sacramento Housing and Redevelopment Agency
a joint powers agency.
“Agency Address” Agency’s business address is 801 12th Street, Sacramento, California 95814 “Owner” Broadway Station, L.P.
“Owner Address” Owner’s business address is as follows: 22 Pelican Way, San Rafael, CA 94901 “Jurisdiction” City of Sacramento
“Property”
That certain real property which is subject to this Regulatory Agreement as further described in the legal description, attached as Exhibit 1 – Legal Description of the Property and incorporated in this Regulatory Agreement by this reference
“Funding
Agreement”
The Funding Agreement between
Agency and Owner as follows:

Titled: Construction and Permanent Loan
Agreement
Dated: May 1, 2023
“Agency Funding” Agency Funding made by Agency to Owner under the Funding Agreement for development of the Property
“Agency Funding
Amount“
The amount of Agency Funding, as follows from (PLHA): $3,300,000.00 “Funding
Requirements”
The legal restrictions on the u se of the funds that Agency has used to make Agency Funding, as applicable to and restricting the Property. The Funding Requirements are set out in Exhibit 2 – Funding Requirements.
“Approved Use” The only permitted use of the Property, which is as a residential property available for rent by the general public and containing not less than the following number of units:
140

3. RESTRICTED PARCELS; APPROVAL OF LEASES. In order to assure that the proper number and types of units have been rented in accor dance with this Regulatory Agreement, Owner is prohibited from leasing any Unit within the Project until either the parties have recorded against the Property a list of the Restricted Units or Agency has approved the individual lease or lease form for the Restricted Units. The following numbers of units are restricted for each respective funding source. The

Construction and Permanent Loan Agreement Page 80
initial rents for the Restricted Units shall be the following; provided, however, that upon the request of Owner, Owner and Agency may agree to a sched ule for the Restricted Units that complies with the following affordability requirements as of the date when the Project is available for occupancy. In any event the rents for the Restricted Units may be adjusted not more often than annually. The rents shall include allowance for utilities and costs reasonably related to the rental of the Restrictive Units, as may be required in determining the rents for the applicable funding sources. Only Restrictive Units indicated under Agency Funding Source are assi sted by Agency. Nevertheless, Owner shall assure the affordability of all of the following Restrictive Units at the named affordability levels.

4. RESTRICTIVE UNITS. Restrictive Units with PLHA as its funding source are fixed units if referenced by Apart ment Number or equivalent; otherwise such units are "floating units" in which the number of units of an affordability level and bedroom type remains the same, but the actual designated unit may change from time to time. Notwithstanding any conflicting provision in the Funding Requirements, the Initial Rent per Unit per Month listed in this Regulatory Agreement shall be paramount and controlling.

Agency Funding
Source: Affordability Level: Number of
Units: Restricted Units:

Initial Rent
per Unit per
Month:

PLHA 60% 7 1-Bedroom $1,216.50
PLHA 60%

4 2-Bedroom $1,368.00
PLHA 60% 4 3-Bedroom $1,519.50
Total Restricted
Units
15 5. MANAGEMENT AGREEMENT. Owner agrees that at all times the Project shall be managed by a property manager (i) approved by Agency in its reasonable discretion and (ii) who has successfully managed at least five projects over forty units in size and subject to a recorded regulatory agreement for at least three years’ prior to the application, without any record of material viol ations of discrimination restrictions or other state or federal laws or regulations or local governmental requirements applicable to such projects (the “Manager”). Owner shall submit to Agency from time to time such information about the background, exper ience and financial condition of any existing or proposed Manager as Agency may reasonably require to determine whether such Manager meets the requirements for a Manager set forth herein. Agency reserves the right to conduct periodic reviews of the manage ment practices and of the Manager to determine if the Project is being operated and managed in accordance with the requirements and standards of this Regulatory Agreement and the Funding Agreement.

Owner agrees to cooperate with Agency in such reviews.

If Agency determines in its reasonable judgment that the Project is not being operated and managed in accordance with one or more of the requirements or standards of the Funding Agreement, Agency may deliver notice to Owner requesting replacement of the Manager, which notice shall state clearly the reasons for such request. Owner agrees that, upon receipt of such notice, Owner shall within 60 days submit to Agency, a proposal to engage a new Manager meeting the requirements of this provision. Agency shall respond within 30 days to such proposal or such approval shall be deemed given. Upon receipt of such consent or deemed consent, Owner shall promptly terminate the existing Manager’s engagement and engage the new Manager.

Owner shall not enter into any ma nagement agreement or arrangement with any party with respect to the management of the Project without Agency's prior written consent, such consent not to be unreasonably withheld or delayed. Owner shall not materially modify, amend or terminate any approved management agreement (other than as required to comply with the terms of the Funding Agreement and/or applicable law) without Agency's prior written consent, which consent will not be unreasonably withheld or delayed; provided, however, that such consent shall not be required to extend the term of an existing management agreement.

Approved Management Company
EAH Inc.

6. SPECIAL PROVISIONS. Owner shall also comply with the following special provisions.

Provision Term

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ANNUAL ADMINISTRATIVE FEE. Borrower agrees to pay an annual administrative fee (“Fee”) to Lender as compensation for monitoring compliance with regulatory restrictions and the administration of the Loan. Borrower shall pay annually a Fee equal to $25,000. Fee payments shall commence on the Closing Date for the prorated semiannual period from the Closing Date to and including October 31, 2023, and in equal semiannual installments in advance on each May 1 and October 1 of each year thereafter throughout the term of the Regulatory Agreement.

7. REPRESENTATIONS. Agency has provided Agency Funding to Owner to develop the Property, subject to the terms of the Funding Agreement. For purposes of this Section 7, “Property” shall mean Property or Restricted Unit as the context may indicate. This Regulatory Agreement is a substantial part of the consideration to Agency for making Agency Funding. The funds used by Agency under the Funding Agreement are funds from public funding sources administered by Agency and their use is subject to certain requirements some of which are embodied in this Regulatory Agreement. Further, Agency has made Agency Funding in accordance with the laws, rules and regulations to which Agency is subject. Therefore, Agency has made Agency Funding conditioned upon Owner’s agreement, for itself and its successors and assigns, to comply with all provisions of this Regulatory Agreement, including without limitation, the Funding Agreement. Owner represents that it has had full opportunity to make itself independently familiar with such limitations and restrictions, and Owner accepts them and agrees to comply fully with them.

8. COVENANTS. Owner makes the following covenants. Unless Owner has received the prior written consent or Agency approval otherwise, Owner shall fully c omply with each and every covenant. Except as otherwise stated in this Regulatory Agreement, the following covenants shall have a term that is the same as the longest term specified in the Funding Requirements.

a. Owner shall use and permit others to use the Property only for the Approved Use.

b. Owner shall ensure full compliance with the Funding Requirements.

c. Owner shall not convey, transfer, hypothecate, or otherwise encumber any of the Property or permit the conveyance, transfer, hypothecation, or encumb rance of the Property unless such assignee, transferee, beneficiary, or encumbrancer has agreed, in writing and in a form suitable for recordation, to be bound by the terms of this Regulatory Agreement.

d. Owner shall not cause and shall not permit expansion , reconstruction, or demolition of any part of improvements on the Property, except as provided by the Funding Agreement.

e. Owner shall maintain the Property and all building improvements, grounds and equipment of the Property in good repair and condition a nd in compliance with all applicable housing quality standards and local code requirements. Owner shall maintain the Property in good condition and shall keep the Property reasonably free from graffiti and unrepaired vandalism and from accumulation of abandoned property, inoperable vehicles, unenclosed storage, debris, waste materials, and hazardous substances. In the event of a casualty loss, Owner shall cause the restoration or replacement of the Property, in a timely manner and provided that such restoration or replacement is then economically feasible.

f. Owner shall not cause and shall not permit discrimination based on race, color, national origin, religion, sexual orientation, gender, familial status, age or disability in the sale, lease, or rental or in the use or occupancy of the Property.

Owner covenants by and for him/her/itself, his/her/its heirs, executors, administrators, and assigns, and all persons claimin g under or through them that there shall be no discrimination against or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. This covenant against discrimination shall continue in perpetuity.

g. Owner shall not evict, refuse to rent to, or otherwise treat someone differently because of that person’s status as a victim of domestic violence, dating violence, sexual assault, or stalking, in compliance with the Violence Against Women Act. This protection is available regardless of sex, gender identity, or sexual orientation.

h. Owner shall ensure compliance with the obligations imposed by the federal Personal Responsibility and Work Opportunity Act (Public Law 104-193, commonly known as the Welfare Reform Act) as amended by California Welfare and Institutions Code Section 17851, which restrict Agency funding of federal, state or local benefits to persons who are not citizens or qualified aliens as defined in such act.

i. Owner shall provide Agency with a detailed resident services plan including but not l imited to the following information: (1) identification of all entities responsible for providing resident services to Project tenants and each entit y’s

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role in the provision of those services; (2) a description of the services to be provided; (3) a reside nt services budget and proforma; and (4) Agency approved resident services at the Project according to the following minimum schedule of sixty (60) hours per week:

1) Coordinator: six (6) hours per week
2) After School programming ten (10) hours per week (two hours per day and five days per week, minimum) 3) Additional Programming: balance of forty-four (44) hours per week shall include the following:
a) Workforce development support and activities
b) educational classes such as nutrition, exercise, health resources, he alth insurance application assistance, annual onsite health fair, English as a Second Language (ESL) classes. c) Socialization activities such as bingo, gardening and community building events; and d) Other services such as case management, planned recreation, transportation assistance, counseling assistance and employee readiness and job search assistance.

j. Owner shall not pass utility charges paid by Owner, including water, sewer, and garbage collection charges, through to tenants as an add-on to their contracted rent subject to adjustments permitted by applicable utility allowances.

k. Owner shall not make payment of rental insurance premiums a condition of occupancy. If Owner require renters’ insurance, the policy premium must be deducted from the tenant’s ren t. Owner shall not add the insurance premium to the tenant’s rent in either the initial or subsequent years.

l. Owner shall make all of the units, indoor common areas and buildings smoke free.

9. NATURE OF COVENANTS. The provisions contained in this Regulatory Agreement are covenants which subject and burden the Property, as covenants running with the land. It is intended and agreed that the agreements and covenants provided in this Agreement shall be covenants running with the land and equitable servitudes on the land and that they shall, in any event, and without regard to technical classifications or designation, be binding, to the fullest extent permitted by law and equity , for the benefit and in favor of, and enforceable by, Agency, Agency's succ essors and assigns, any other governmental entity acting within its authority and any successor in interest to Agency's interest under this Regulatory Agreement against Owner, its successors and assigns and every successor in interest to all or any part of the Property.

10. TERM. The term of this Regulatory Agreement shall commence on the Effective Date and continue until the terms of all of the covenants, including without limitation, the terms stated in the Funding Requirements, have expired or otherwise been terminated. Notwithstanding the term in the Funding Requirements, the term of this Regulatory Agreement shall be fifty - five (55) years from the Effective Date.

11. EXPIRATION OF AFFORDABILITY PERIOD. Owner agrees the rent of "in-place” tenants at the conclusion of the Term will continue to be governed by the applicable affordability restrictions, so long as those tenants continue to live in the development.

12. MULTIPLE FUNDING REQUIREMENTS. If more than one form of Funding Requirements is attached, each Restricted Unit shall be subject to the Funding Requirements for every Funding Source applied to the respective Restricted Unit. If the terms of the Funding Requirements shall conflict as to any Restricted Unit, the Funding Requirements shall be construe d so as to meet all applicable requirements for the respective Restricted Unit, including without limitation the use of the most restrictive requirements and the use of the “Recapture” formula that results in the greatest repayment to Agency.

13. RECORDKEEPING AND REPORTING. Upon request of Agency, Owner shall promptly provide any additional information or documentation requested in writing by Agency to verify Owner's compliance with the provisions of this Regulatory Agreement. At the written request of Agency, Owner shall, within a reasonable time following receipt of such request, furnish reports and shall give specific answers to questions upon which information is desired from time to time relative to the income, assets, liabilities, contracts, operations, and condition of the property and the status of any deeds of trust encumbering the Property.

14. AUDIT AND INSPECTION. The Property and all related equipment, buildings, plans, offices, books, contracts, records, documents and other related papers shall at a ll times be maintained in reasonable condition for audit and shall be subject to examination by Agency or its agents. The books and accounts of the operations of the Property shall be kept in accordance with generally accepted accounting principles. Owne r shall provide Agency access to the Property and its tenants during reasonable hours for the purpose of reviewing Owner’s compliance with this Regulatory Agreement.

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15. INDEMNITY FOR OWNER’S FAILURE TO MEET LEGAL REQUIREMENTS. Owner shall indemnify and hold Agency, its officers, directors, and employees harmless from any and all liability arising from Owner’s failure to comply with the covenants, conditions and restrictions contained in this Regulatory Agreement or to comply with all other laws, rules, regulations and restrictions related to the use of Agency Funding. Without limitation, such indemnity shall include repayment to the appropriate parties of rents or sales proceeds in excess of amounts authorized to be charged and repayment to Agency of the cost s of funds and the value of lost opportunities resulting from the required repayment by Agency to the funding source of funds improperly used.

16. CHANGES WITHOUT CONSENT OTHERS. Only Agency and its successors and assigns, and Owner (subject to the reasonable approval of Owner's lender and investor limited partner) shall have the right to consent and agree to changes in, or to eliminate in whole or in part, any of the covenants or restrictions contained in this Regulatory Agreement without the consent of any easement holder, licensee, other mortgagee, trustee, beneficiary under a deed of trust or any other person or entity having any interest less than a fee in the Property.

17. DEFAULT. Upon a breach of any of the provisions of this Regulatory Agreement by Own er, Agency may give written notice of such breach to Owner by registered or certified mail. If such violation is not corrected to the satisfaction of Agency within thirty (30) days after the date such notice is mailed or within such further time as Agency may determine in its sole and absolute discretion is necessary to correct the breach, and without further notice to Owner, Agency may declare a default under this Agreement, effective on the date of such declaration of default, and upon such default Agenc y may: (a) take any action then available under the Funding Agreement for a default under the Funding Agreement; (b) apply to any court for specific performance of this Regulatory Agreement, (c) apply to any court for an injunction against any violation of this Agreement; (d) apply to any court for the appointment of a receiver to take over and operate the Property in accordance with the terms of this Regulatory Agreement, (e) apply to any court for money damages; or (f) apply to any court or other tribunal for such other relief as may be appropriate. The parties agree the injury to Agency arising from a default under any of the terms in this Regulatory Agreement would be irreparable, and the amount of damage would be difficult to ascertain. A copy of any notice sent to Owner will be sent to Owner’s investor limited partner at the following address: Wells Fargo Affordable Housing Corp., 550 S. Tryon Street, 23 rd Floor, D1086-239, Charlotte, NC 28202 -4200, Attention: Director of Tax Credit Asset Management; provided, however, that failure by Agency to deliver such notice to Owner’s investor limited partner shall not impair Agency’s rights in any way. Such investor limited partner shall have the right, but not the obligation, to cure any default of the Owner on the same terms as Owner.

18. REGULATORY AGREEMENT VIOLATIONS. Owner shall pay the program compliance fees and expenses to Agency set forth in Compliance Violations and Actions (Exhibit 3 - Compliance Violations and Actions) in reimbursement of the amounts and time expended by Agency to insure Owner’s compliance with State statutes and federal regulations and Owner’s obligations under this Regulatory Agreement as a result of Owner not meeting its obligations and reporting requirements. No compliance fee wi ll be assessed for one incident of each type of compliance violation per annual inspection provided the violation is corrected within the specified corrective time period. The second and subsequent violations will be assessed compliance fees as detailed in the Compliance Violations and Actions tables.

19. BINDING SUCCESSORS IN INTEREST. This Regulatory Agreement shall bind and the benefits shall inure to Owner, its successors in interest and assigns, and to Agency and its successors for the term of this Regu latory Agreement.

20. CONTRADICTORY AGREEMENTS. Owner warrants that it has not, and will not, execute any other agreement with provisions contradictory of or in opposition to, the provisions of this Regulatory Agreement, and that, in any event, to the extent permitted by law, the requirements of this Regulatory Agreement are paramount and controlling as to the rights and obligations set forth and supersede any other requirements in conflict with this Regulatory Agreement.

21. COMPLIANCE AMENDMENTS. If revisions to the provisions of this Regulatory Agreement are necessitated to comply with the laws or regulations governing Agency Funding, Owner agrees to execute modifications to this Regulatory Agreement that are needed to comply with such laws or regulations.

22. ATTORNEYS' FEES. If the services of any attorney are required by any party to secure the performance of this Regulatory Agreement or otherwise upon the breach of default of another party, or if any judicial remedy or mediation is necessary to enforce or in terpret any provision of this Regulatory Agreement or the rights and duties of any person in relation to this Regulatory Agreement, the prevailing party shall be entitled to reasonable attorneys' fees and costs in addition to any other relief to which such party may be entitled. Any award of damages following judicial remedy or arbitration as a result of this Regulatory Agreement or any of its provisions shall include an award of prejudgment interest from the date of the breach at the maximum amount of interest allowed by law. The prevailing party shall mean the party receiving an award in arbitration or a judgment in its favor, unless the award or judgment is less favorable than the best settlement offered in writing in a reasonable manner by the other party, in which case the prevailing party is the other party.

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23. SEVERABILITY. The invalidity or unenforceability of any clause, part or provision of this Regulatory Agreement shall not affect the validity of the remaining portions.

24. ELECTION OF REMEDIES. To the extent applicable, in the event of any breach of any covenant, condition or restriction contained in this Regulatory Agreement, Agency shall reasonably endeavor to remedy such breach by conference and conciliation. If, in the opinion of Agency, Agenc y and Owner are unable mutually to agree upon a suitable remedy or the circumstances so warrant, such breach may be enjoined or abated by appropriate proceedings brought by Agency.

Agency may institute or prosecute in its own name, any suit Agency may con sider advisable in order to compel performance of any obligation of any owner to develop and maintain the subject property in conformity with this Regulatory Agreement and to remedy any default of this Regulatory Agreement. Agency may also seek a decree r equiring removal of any improvements constructed on the Property which improvements are designed for uses not permitted under this Regulatory Agreement and which improvements are unsuitable only for uses not permitted under this Regulatory Agreement.

The remedies of Agency under this Regulatory Agreement are cumulative, and the exercise of one or more of such remedies, including, without limitation, remedies under the Funding Agreement shall not be deemed an election of remedies and shall not preclude the exercise by Agency of any one or more of its other remedies.

25. NO WAIVER. No waiver by Agency of any breach of or default under this Regulatory Agreement shall be deemed to be a waiver of any other or subsequent breach or default.

26. NOTICES. Written notices and other written communications by and between the parties shall be addressed to Owner at Owner’s Address and to Agency at Agency Address or such other address as each respective party has designated by written notice to the other party.

THE PARTIES HAVE EXECUTED THIS REGULATORY AGREEMENT in Sacramento, California as of the Effective Date

BROADWAY STATION, L.P, a California limited partnership

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Construction and Permanent Loan Agreement Page 85
THE PARTIES HAVE EXECUTED THIS REGULATORY AGREEMENT in Sacramento, California as of the Effective Date

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY,

A JOINT POWERS AGENCY

By: _______________________________________
La Shelle Dozier, Executive Director

Approved as to form:

___________________________________________
Agency Counsel

Construction and Permanent Loan Agreement Page 86
EXHIBIT 1

Legal Description
The land referred to in this Report is situated in the County of Sacramento, City of Sacramento, State of California, and is described as follows:

PARCEL ONE:

LOTS 1, 2, 7 AND 8, IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF.

PARCEL TWO:

ALL THAT PORTION OF THAT CERTAIN ALLEY IN THE BLOCK BOUNDED BY "X" AND BROADWAY, 19TH AND 20TH STREETS OF THE CITY OF SACRAMENTO, ACCORDING TO THE OFFICIAL PLAT THEREOF, PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING AT THE SOUTHWESTERLY CORNER OF LOT 1 OF SAID BLOCK, SAID CORNER BEING AT THE INTERSECTION OF THE EASTERLY LINE OF 19TH STREET AND THE NORTHEASTERLY LINE OF SAID ALLEY; THENCE SOUTHEASTERLY 151 FEET, ALONG THE SOUTHWESTERLY LINE OF SAID LOT AND LOT 2 OF SAID BLOCK; THENCE SOUTHERLY IN A DIRECT LINE ACROSS SAID ALLEY TO THE NORTHEASTERLY CORNER OF LOT 7 OF SAID BLOCK, SAID CORNER BEING LOCATED ON THE SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; THENCE NORTHWESTERLY 160 FEET, ALONG THE NORTHEASTERLY LINE OF SAID LOTS 7 AND 8, IN SAID BLOCK, AND TH E SOUTHWESTERLY BOUNDARY LINE OF SAID ALLEY; TO THE NORTHWESTERLY CORNER OF SAID LOT 8, LOCATED ON THE EASTERLY BOUNDARY LINE OF SAID 19TH STREET; THENCE NORTHEASTERLY 20 FEET ALONG SAID EASTERLY BOUNDARY LINE OF 19TH STREET, TO THE POINT OF BEGINNING.

APN: 010-0213-008

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EXHIBIT 2

Funding Requirements

PERMANENT LOCAL HOUSING ALLOCATION (PHLA) FUNDING REQUIREMENTS

These “PLHA Funding Requirements” are attached to a Regulatory Agreement, and are incorporated in that Regulatory Agreement. In turn, the Regulatory Agreement is incorporated in the Loan that is described in the Regulatory Agreement.

The capitalized terms used in these PLHA Funding Requirements shall have the meanings below in the body of the these PLHA Funding Requirements. Terms being defined are indicated by quotation marks. Capitalized terms in these PLHA Funding Requirements that are not defined below are defined in the Regulatory Agreement.

5. RECITALS. The Loan is funded by the Agency with proceeds of the Permanent Local Housing Allocation P rogram, established by California SB 2 (Chapter 364, Statutes of 2017) and operating under the requirements of California Health and Safety Code, Part 2 of Division 31, Chapter 2.5 (commencing with Section 50470). The Agency has approved the Loan on condition that the property securing the Loan (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with PLHA requirements (“PLHA -Assisted Units”) by recordation of these PLHA Funding Restrictions as covenants running with the land.

6. ELIGIBLE ACTIVITIES. Owner shall ensure that PLHA funding is used solely for one or more Eligible Activities. “Eligible Activities” are limited to the following:

a. Development of new multifamily rental housing that is affordable to households at below 60 percent of Area Median Income (AMI) or substantial rehabilitation of multifamily rental housing that will be affordable to households at or below 60 percent of AMI, but which is not currently restricted as affordable housing. In order to be eligible as “substantial rehabilitation”, a project must complete a minimum of $40,000 per unit in hard construction costs; or

b. Assistance to persons who are experiencing or at risk of homelessness, including, but not limited to, through rapid rehousing, rental assistance, supportive services, and case management services that allow people to obtain and retain housing, operating and capital costs for navigation Centers, or new construction, rehabilitation, or preservation of permanent or transitional rental housing.

7. COMPLIANCE WITH LAWS. Owner shall comply with all laws, rules, regulations, and funding requirements that govern the use of PLHA funds, including but not limited to those listed in this Section 3(a) through 3(f). If Agency, as a result of actions of Owner, is obligated to repay the California Department of Housing and Community Development or the PLHA Program any amount under the PLHA Loan, Owner shall make such repayment on account of Agency and failure to do so shall be an Event of Default under the Funding Agreement.

a. Article XXXIV, Section 1 of the California Constitution, as clarified by the Public Housing Election Implementation Law (California Health and Safety Code (HSC) Section 37000 – 370002).

b. The Pet Friendly Housing Act of 2017 (HSC Section 50466). Further, Owner s hall submit to Agency a signed and dated certification that all residents of the PLHA-funded Project will be authorized to own or otherwise maintain one or more common household pets as required by HSC Section 50466 for the entire term of the Regulatory Ag reement. Pursuant to the statute, “common household pet” means a domesticated animal, such as a dog or cat, commonly kept in the home for pleasure rather than for commercial purposes.

c. Prevailing Wage Law, as set forth in California Labor Code Section 1720 et seq., requiring the payment of prevailing wages unless the Project meets one of the exceptions of California Labor Code Section 1720(c), as determined by the California Department of Industrial Relations.

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d. Relocation Law, pursuant to Government Code Section 7260 et. seq., Title 25 of the California Code of Regulations Section 6000 et. seq., and if federal law is applicable, Code of Federal Regulations (CFR) at 49 CFR Part 24 of the UMRs and Real Property Acquisition for Federal and Federally Assisted Programs.

e. The accessibility requirements set forth in California Building Code Chapter 11A and 11B and the Americans with Disabilities Act, Title II. In addition, Owner shall ensure the Project complies with either the Uniform Federal Accessibilit y Standards (UFAS) standards, 24 CFR Part 8, or HUD's modified version of the 2010 Americans with Disabilities Act (ADA) Standards for Accessible Design (Alternative 2010 ADAS), HUD -2014-0042-0001, Federal Register, 79 FR 29671 (5/27/14) (commonly referred to as "the Alternative Standards" or "HUD Deeming Memo"), whichever applies to the Project. Accessibly units shall, to the maximum extent feasible and subject to reasonable health and safety requirements, be distributed throughout the project and be available in a sufficient range of sizes and amenities consistent with 24 CFR Section 8.26.

f. The Americans with Disabilities Act, the Fair Housing Amendments Act, the California Fair Employment and Housing Act, the Unruh Act, Government Code Section 11135, Rehabilitation Act Section 504, and regulations promulgated pursuant to those statutes, including 24 CFR Part 100, 24 CFR Part 8, and 28 CFR Part 35.

8. NON-DISCRIMINATION POLICY. Owner shall adopt a written non-discrimination policy requiring that no person shall, on the grounds of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, age, medical condition, genetic information, citizenship, primary language, immigration status (except where explicitly prohibited by federal law), arbitrary characteristics, and all other classes of individuals protected from discrimination under state or federal fair housing laws, individuals perceived to be a member of any of the preceding classes, or any individual or person associated with any of the preceding classes be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any program or activity funded in whole or in part with PLHA funds.

9. AFFORDABILITY REQUIREMENTS. Owner shall ensure that all of the Restricted Units assisted with PLHA funds are rented at or below sixty percent (60%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development, as adjusted for family size appropriate to the size and number of bedrooms in the respective Restricted Unit.

10. OCCUPANCY REQUIREMENTS. Owner shall ensure that all Restricted Units are occupied by households earning less than sixty percent (60%) of Median Income.

11. UNIT QUALITY. Owner shall ensure that Restricted Units assisted with PLHA funds are comparable in size and amenities to other units in the Project, especially, if applicable, units in the Project that are not subject to restrictions regarding maximum rent or maximum household income.

12. TERM. These covenants shall burden and regulate the Restricted Units for a term of fifty -five (55) years.

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EXHIBIT 3

Compliance Violations and Actions

COMPLIANCE VIOLATIONS AND ACTIONS
(All payments due and payable within 30-days of assessment)

Tenant Eligibility and Affordability Violations
Compliance
Violation
Fees and Actions* Corrective Time Period
Tenants over income
at
initial move-in
Initial $500 per unit, again every 90 days
until another income qualified tenant is
housed.

Correction: Evict tenant if tenant fraud.

Otherwise, next available unit must be
Affordable and rented to an Income-
Qualified tenant.
90 days from discovery date to avoid additional
$500 charge every 90-days the problem is not
corrected.

Incorrect eligibility
documentation
Initial $50 per file for incorrect
calculations, verifications, or required
documents. Additional $50 per month if
not corrected.

Correction: Submit copies of corrections
to compliance staff as applicable.
30 days from discovery date to submit copies of
corrections to compliance staff to avoid additional
$50 per month if not corrected
Failure to complete
annual
recertifications
Initial $250 for each incomplete file.

Additional $50 per month if not corrected.

Correction: Submit copies of
recertifications to compliance staff.
30 days from discovery date to submit corrections
to avoid additional $50 per month if not
corrected.

Failure to maintain
tenant eligibility
records
Initial $500 per unit, again every 90-days
thereafter until new records in place.

Additional $100 per unit per month the
project remains out of compliance.

Correction: Immediately establish new
files/records.
30 days from discovery date to submit copies of
new records to avoid additional $100 per unit per
month the project remains out of compliance.

Incorrect Rents Reimbursement to tenant of the entire
amount overcharged. $100 payment to
Agency for each over-charged unit.

Correction: Refund tenant with letter of
correction.
30 days from discovery date to avoid additional
$100 per overcharged unit per month fee to
Agency.

Failure to submit
complete and
accurate monthly
Bond Report by due
date
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
7 days from discovery date to submit complete
and accurate report to avoid additional $100 per
day charge.

Failure to comply
with approved
Management Plan
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
30 days from discovery date to submit corrections
to avoid additional $100 per day charge.

Failure to submit
complete and
accurate quarterly
Resident Services
report by due date
Initial $100 per report. Additional $100
per day until complete and accurate report
submitted. Correction: Submit copies of
corrections to compliance staff as
applicable.
7 days from discovery date to submit corrections
to avoid additional $100 per day charge.

Failure to provide a
resident service
required by Resident
Services Plan
Initial $250 per service. Additional $100
per day until service is provided.

Correction: Implement required service or
7 days from discovery date to implement required
service or provide new resident services plan to
avoid additional $100 per day charge; 30 days

Construction and Permanent Loan Agreement Page 90
new resident services plan submitted and
approved; approved plan implemented.
from discovery date to implement new plan to
avoid additional $100 per day charge.

Noncompliant lease $100 per noncompliant lease.

Correction: Prepare and execute approved
lease or addendum to address the
deficiency.
30 days from discovery date to avoid additional
$100 per noncompliant lease per month charge to
Agency.

Housing Quality Standards Violations
Compliance
Violation
Fees and Actions* Corrective Time Period
Verifiable existence
of Toxic Mold
$200 per unit. Additional $75 per day
charge each time efforts fall outside of
corrective timeframes.

Correction: Prepare and submit action plan
that addresses scope of work and timetable
to complete. Relocate tenant if necessary.

Obtain certified clearance that mold has
been abated and unit is safe to occupy
once again.
3-days from discovery date to submit action plan
to address. 10-days to relocate tenant if necessary.
30-days to obtain certification that unit is mold
free. $75 per day additional charge each time
efforts fall outside of these timeframes.

Broken pipes and
plumbing facilities
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Repair/replace as necessary
7-days from discovery date to avoid additional
$75 per day each day thereafter corrective action
not taken.

Smoke detectors not
working in the units
$200 per unit with non-functional smoke
detector. Additional $75 charge per day if
not corrected.

Correction: Replace batteries or non-
working unit within 24 hours.

Within 24 hours of discovery date to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Windows with large
cracks or missing
glass
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Infestation of roaches
or vermin
$200 per infested unit. Additional $75
charge per day if not corrected.

Correction: Letter from pest control
company verifying removal of pests with
paid invoice to compliance staff.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Non-working heating
unit (Winter) or air
conditioning unit
(Summer)
$500 per nonworking unit. Additional $75
charge per day if not corrected. $75 re-
inspection fee if necessary to verify
problem corrected.

Correction: Repair/replace as necessary.

Within 24 hours of discovery date to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Excessive amount
of urine/ feces
$200 per unit. Additional $75 charge per
day if not corrected.

Correction: Clean unit as necessary and
address problem as the lease allows.

Submit correction letter with
documentation to compliance staff.
7-days from date of discovery to avoid $75 per
day additional charge each day thereafter
corrective action not taken.

Excessive amount of
trash/garbage in the
unit
$75 per unit. Additional $75 charge per
day if not corrected.

Correction: Clean unit and send letter of
correction to compliance staff.
14-days from date of discovery to avoid an
additional $75 per day thereafter each day
corrective action not taken.

Hazardous exterior
conditions
$500 for hazardous conditions. Additional
$75 charge per day if not corrected. $75
re-inspection fee.

Correction: Clean and/or repair as
necessary. Re-inspection to verify problem
addressed.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Construction and Permanent Loan Agreement Page 91
Large holes
walls/ceiling
$100 per unit. Additional $75 charge per
day if not corrected.

Correction: Submit correction letter with
documentation to compliance staff.
30-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Non-Operable
Security Gate
$500 per non-working gate. Additional
$75 charge per day if not corrected. $75
re-inspection fee if necessary to verify
problem corrected.

Correction: Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

No Security Cameras
(if cameras required)
$250 per discovery. Additional $75
charge per day if not corrected. $75 re-
inspection charge to verify problem
corrected.

Correction: Replace cameras.
30-days from the date of discovery to avoid $75
per day additional charge each day thereafter
corrective action not taken.

Non-working
Security Cameras
$100 per camera per discovery.

Additional $75 charge per day if not
corrected. $75 re-inspection charge to
verify problem corrected. Correction:

Repair/replace as necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

Non-working or non-
accessible
amenities/services
$100 per item per discovery. Additional
$75 charge per day if not corrected. $75
re-inspection charge to verify problem
corrected. Correction: Repair/replace as
necessary.
7-days from date of discovery to avoid $75 per
day additional charge each day corrective action
not taken.

* No compliance fee will be assessed for one incident of each type of compliance violation per annual inspection provided the violation is corrected within the specified corrective time period. The second and subsequent violations will be assessed compliance fees as detailed in the Tenant Eligibility and Affordability Violations and Housing Quality Standards Violations tables.

Construction and Permanent Loan Agreement Page 92
Exhibit 8: Escrow Instructions

JOINT ESCROW INSTRUCTIONS

FOR AGENCY LOAN

“Effective Date” May 1, 2023

Agency and Borrower execute these Escrow Instructions as of the Effective Date. This document, including attachments and any amendments and additions, shall constitute the joint escrow instructions of Agency and Borrower for the Agency loan secured by the Property.

ARTICLE I. GENERAL TERMS.

1. GENERAL. These Escrow Instructions, in addition to items listed below, include Article II Instructions, which is attached to and incorporated in these Escrow Instructions by this reference.

2. DEFINITIONS. The capitalized terms in these Escrow Instructions shall have the meanings assigned in Article I General Terms and as defined in Article II Instructions. (Terms being defined are indicated by quotation marks.)

“Title
Company”
Old Republic Title Company
Address: 555 12th Street, Suite 2000, Oakland, Ca 94607 “Escrow” with
Title Company
Escrow
Number:
1117021329 Attention: Julie Massey
“Agency” Sacramento Housing and Redevelopment Agency
Address: 801 12th Street, Sacramento, CA 95814
Attention: Noni Ifyefobi
“Borrower” Broadway Station, L.P.

Address: 22 Pelican Way, San Rafael, CA 94901
Attention: Daniel Rhine
“Closing Date” May 1, 2023
“Property” Address: 1901 Broadway, Sacramento, Ca
95818
APN: 01002130080000
Description of
the transaction

1. The following loan is made from SHRA to the Borrower: HOME Investment Partnership Program (HOME), Housing Trust Fund (HTF), Mixed Income Housing Fund (MIHF), Permanent Local Housing Allocation (PLHA), Construction and Permanent Loan, made pursuant to a loan agreement (“Loan Agreement”) evidenced by promissory note (“Note”) and secured by deed of trust (the “Deed of Trust”); and SHRA will record regulatory agreements and declaration of restrictive covenants against the Property (the “HOME Regulatory Agreement,” the “PLHA Regulatory Agreement,” and the “HTF and MIHF Regulatory Agreement); all made effective May 1, 2023

Total Funds to Borrower: $7,300,000.00

“Recorded Documents”- The
following documents are to be
recorded in the order listed
(top being first in priority).

Copies of the Recorded
documents are attached.

Documents:

Marked for return to:

Construction and Permanent Loan Agreement Page 93
HOME Regulatory Agreement
HTF MIHF Regulatory Agreement
PLHA Regulatory Agreement
Deed of Trust

Sacramento Housing and
Redevelopment Agency
Development Finance
801 12th Street
Sacramento, CA 95814

“Agency Items” Promissory Note for subject loan

Loan Agreement for the subject loan

Authorizing resolutions for all Borrower signatories

“Borrower Items” Loan proceeds in the amount of Seven Million and Three Hundred Thousand dollars and Zero cents ($7,300,000.00)
Conformed copies of the executed and recorded documents.

“Special Provisions”: Title Policy shall, in addition to customary endorsements, bear the following endorsements:
 ALTA 102.5 Foundation Endorsement
 ALTA Rewrite upon project completion
For the Regulatory Agreement - CLTA 124.1

“Agency Title Policy” in the
form of an ALTA Agency’s
Policy insuring that the
following are valid liens
against the property:

Documents:

Coverage amount:

Regulatory Agreement and Deed of Trust In the amount of the loan secured ($7,300,000)
The title policies shall be
subject only to the following
“Conditions of Title”:

As set forth in the final approved Pro Forma Dated: *** Date*** Number: 1117021329

ARTICLE II. INSTRUCTIONS

1. CLOSING DATE. Escrow shall close on or before the Closing Date as it may be changed from time to time by written agreement of Borrower and Agency.

2. CONDITIONS TO CLOSE OF ESCROW. “Close of Escrow” means the fulfillment of the Escrow terms and conclusion of the Escrow, including, without limitation, the execution of unexecuted documents, the recordation of documents specified for recording, the issuance of title insurance policies, the payment of fees and the delivery of funds and documents as directed in the escrow instructions for the Escrow. The Close of Escrow shall occur on the Closing Date.

2.1. CONDITIONS. The following are conditions to the Close of Escrow:

2.1.1. The conditions precedent to performance stated in the Recorded Documents are satisfied as of the Closing Date.

Construction and Permanent Loan Agreement Page 94

2.1.2. Simultaneously with the Close of Escrow, Title Company shall issue the Agency Title Insurance to Agency (at Borrower’s cost) in the amount stated. The Agency Title Insurance shall include all usual and customary endorsements and any endorsements and other commitments as Agency may reasonably require. The Agency Title Insurance shall show the Recorded Documents marked for return to Agency as valid liens against the Property in favor of the Agency, subject only to the Conditions of Title, and securing, as applicable, Borrower’s performance of its obligations and repayment of Agency Funding.

2.1.3. Prior to the Closing Date, the parties shall duly execute (in Escrow or prior to deposit in Escrow) each such document and shall execute those to be recorded in a manner suitable for recording.

2.1.4. On or before the Closing Date, Agency shall also deposit with Title Company the Borrower Items and any Loan Amount then to be disburs ed under this Agreement, but not less than closing costs, fees and charges required for Close of Escrow.

2.1.5. On or before the Close of Escrow, Borrower shall also deposit with Title Company the Agency Items and Borrower’s share of closing costs and fees.

2.1.6. Title Company is satisfied that all required funds have been deposited in Title Company’s account for the Escrow, have cleared the originating bank and are available for transfer by Title Company’s check or wire transfer to the appropriate party.

2.2. DEED OF TRUST FORM. If no exhibit setting out the form of the Deed of Trust form is attached, the Title Company shall draw the Deed of Trust on the Title Company’s Long Form Deed of Trust. Title Company shall assure that the Deed of Trust includes a standard clause giving Agency the option to accelerate the Loan upon the sale, conveyance, transfer or further encumbrance of the Property, whether voluntary or involuntary. Title Company shall also affix the following provision to the Deed of Trust and incorporate it in the Deed of Trust by reference:

“The Loan Agreement requires the filing of the “Regulatory Agreement” that is defined in the Loan Agreement. The Regulatory Agreement contains covenants running with the land and is recorded against the Property. If Borrower does not comply with the requirements of the Regulatory Agreement and fails to come into compliance with the Regulatory Agreement within thirty (30) days after Agency’s written notice to Borrower of such failure, the principal balance of the Loan shall, at Agency’s option, be immediately due and payable, together with all unpaid interest at the stated rate from the date of the advancement of the Loan's proceeds.”

2.3. UPON CLOSE OF ESCROW. The Close of Escrow shall take place on the Closing Date. On t he Closing Date, Title Company shall complete the Close of Escrow as follows and in the following order (unless otherwise stated, all recorded documents are recorded with the Sacramento County Recorder):

2.3.1. Assure fulfillment of the Special Provisions;

2.3.2. Assure all documents are complete and affix legal descriptions of the Property as necessary to complete them;

2.3.3. Obtain full execution of all unexecuted documents;

2.3.4. Date all undated documents as of the Closing Date;

2.3.5. Record the Recorded Documents in the priority listed;

2.3.6. Determine all closing costs and fees; including without limitation, all charges, fees, taxes and title insurance premiums payable under this Agreement on Close of Escrow and any other fees and charges approved for payment from Escrow by both parties and deduct such fees from the Loan proceeds deposited by Agency in Escrow;

2.3.7. Deliver the Agency Items to Agency and the Borrower Items to Borrower; and

2.3.8. Prepare and deliver to Borrower and Agency, respectively, one signed original of all docume nts included for delivery to either party and not delivered for recording, one signed original of Title Company's closing statement showing all receipts and disbursements of the Escrow, and one conformed copy of each of the recorded documents.

2.4. INABILITY TO CLOSE. If Title Company is unable to simultaneously perform all of the preceding instructions, Title Company shall notify Borrower and Agency, and upon each of their directions return to each party all documents, items and

Construction and Permanent Loan Agreement Page 95
funds deposited in Escrow by su ch party (less fees and expenses incurred by the respective party) and bill the respective parties for any unpaid fees and expenses incurred in Escrow. If Escrow fails to close on the Closing Date because Borrower has not complied with Borrower's obligations under this Loan Agreement, then Borrower shall pay the costs incurred through Escrow to the date the Escrow is terminated, including the cost of any preliminary title report and any cancellation fees or other costs of this Escrow. If Escrow fails to c lose on or before the Closing Date because Agency has not complied with Agency's obligations under this Loan Agreement, such costs shall be paid by Agency. If Escrow fails to close on or before the Closing Date for any other reason, such costs shall be divided equally between the parties.

2.5. COMMISSIONS. Agency is not responsible, by this Loan Agreement or otherwise, to pay commissions in relation to this transaction.

[SIGNATURES APPEAR ON THE FOLLOWING PAGE]

Construction and Permanent Loan Agreement Page 96
THE PARTIES HAVE EXECUTED THESE ESCROW INSTRUCTIONS in Sacramento, California as of the date first written above.

BROADWAY STATION, L.P, a California limited partnership

By: 1901 Broadway Sacramento EAH, LLC,
a California limited liability company

By: EAH Inc.,
a California nonprofit public benefit corporation,
its sole member

By: _______________________________________
Welton Jordan
Title: Assistant Secretary

By: ________________________________
David Egan
Title: Assistant Secretary

By: ________________________________
Laura Hall
Title: Assistant Secretary

Construction and Permanent Loan Agreement Page 97
THE PARTIES HAVE EXECUTED THESE ESCROW INSTRUCTIONS in Sacramento, California as of the date first written above.

AGENCY:

SACRAMENTO HOUSING AND REDEVELOPMENT AGENCY

By: ___________________________________
La Shelle Dozier
Executive Director

/ / / / / / / /

Construction and Permanent Loan Agreement Page 98

ACCEPTANCE OF ESCROW INSTRUCTIONS

Your acceptance of this escrow shall create a contractual obligation by you with Agency and Borrower for complete compliance with these instructions. Agency and Borrower reserve the right to jointly revoke this escrow at any time upon their payment to you of your fees and reimbursement to you of your expenses in accordance with the terms of these escrow instructions. Your obligations as Escrow Holder under these escrow instructions shall be subject to the following provisions:

You are not responsible as to the sufficiency or correctness as to form, manner of execution, or validity of any instrument deposited in this escrow nor as to the authority or rights of any person executing such instrument. Except as otherwise provided in these escrow instructions, your duties as Escrow Holder are limited to the proper handling of monies and the proper safekeeping of instruments and other items received by you as Escrow Holder, and for the performance of your obligations as specifically provided under these escrow instructions. You are responsible for the sufficiency of any instruments or documents prepared by you for this escrow.

Borrower agrees to indemnify and hold you harmless from damages incurred as a result of your good faith and diligent performance of your duties under these escrow instructions.

Upon your acceptance of these escrow instructions, return the executed counterparts of these escrow instructions to Agency and Borrower, respectively.

Escrow Holder acknowledges receipt of the foregoing escrow instructions and agrees to act as Escrow Holder and to comply with the terms and conditions of the escrow instructions.

Dated: _____________________________

TITLE COMPANY

OLD REPUBLIC TITLE COMPANY

By: ______________________________
Name:____________________________
Title:_____________________________
Its authorized agent and signatory

Construction and Permanent Loan Agreement Page 99

Exhibit 7a: HOME Funding Requirements

EXHIBIT 2

Funding Requirements
HOME Funding and Other Federal Requirements
Rental Project
These “HOME Funding and Other Federal Requirements” are attached to the Loan Documents (Loan Agreement and Regulatory Agreement), and are incorporated in the Loan Documents. The capitalized terms used in these HOME Funding and Other Federal Requirements shall have the meanings below in the body of these HOME Funding and other Federal Requirements. Terms being defined are indicated by quotation marks. Capitalized terms in these HOME Funding and Other Federal Requirements that are not defined below are defined in the Loan Documents. References to the CFR are to the Code of Federal Regulations. Project specific restrictions are set forth in the Regulatory Agreement.

1. Definitions. For the purposes of the Loan Documents and in addition to the definitions mad e elsewhere in the Loan Documents, the following capitalized words and phrases contained in this Contract shall have the following meanings:
“HOME” is the federal HOME Investment Partnership program (Catalogue of Federal Domestic Assistance FDA

14.239) administered by the U.S. Department of Housing and Urban Development. a. The “HOME Requirements” are the laws, rules and regulations which are specifically applicable to this contract. A substantial portion of the Federal Requirements are included in th ese HOME Funding and Other Federal Requirements.
b. “Exhibits” to these HOME Funding and Other Federal Requirements contain a substantial portion of the Federal Requirements, and are incorporated into this Agreement in the form of a cloud content management and file sharing service (e.g., Box).

Borrower acknowledges that they have reviewed and accept these Exhibits by initialing here: ____.

The Exhibits included the following:
i. Exhibit 1 – HOME Regulations: 24 Code of Federal Regulations (CFR) Part 92. ii. Exhibit 2 – Requirements for nonprofit subgrantees; 2 CFR §200.70; Appendix VIII to 2 CFR Part 200
iii. Exhibit 3 –Restrictions on Lobbying; 24 CFR Part 87; see also 2 CFR §200.450 iv. Exhibit 4- Federal Labor Standards Provisions: 29 CFR Part 5

2. Recitals. The Agency Funding i ncludes proceeds of the federal HOME Investment Partnerships Act (“HOME”) and its implementing regulations (commencing at 24 CFR Part 92) (“HOME Funds”). The Agency has approved the Agency Funding on condition that the property described in the Loan Docum ents (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with laws, rules and regulations regarding the use of HOME funds for the benefit of low -income persons (“HOME Restricted U nits”) by recordation of these H OME Funding and Other Federal Requirements as covenants running with the land. HOME Restricted Units are made affordable by such regulation to persons and households that qualify as low -income or very low -income as indicate d in the table in Section 3 of the Regulatory Agreement.

3. Use of HOME Funds. Owner shall assure that the HOME Funds are used only for qualified uses. HOME Funds may only be used to provide incentives to develop and support affordable rental housing and ho meownership affordability through the acquisition (including assistance to homebuyers), new construction, reconstruction, or rehabilitation of non - luxury housing with suitable amenities, including real property acquisition, site improvements, conversion, d emolition, and other expenses, including financing costs, relocation expenses of any displaced persons, families, businesses, or organizations; to provide tenant -based rental assistance, including security deposits; to provide payment of reasonable administrative and planning costs; and to provide for the payment of operating expenses of community housing development organizations, all as further defined in 24 CFR §§ 92.205 -92.209. The HOME Funds shall not be used for project reserve accounts except as expressly authorized or to provide operating subsidies.

Owner shall not utilize the Project for explicitly religious activities, including activities that involve overt religious content such as worship, religious instruction, or proselytization, and to the e xtent that Owner engages in such explicitly

Construction and Permanent Loan Agreement Page 100
religious activities, it shall perform such activities and offer such services outside of the program pursuant to which Owner is developing the Project pursuant to this Agreement. The Owner further represents that the Project units are available to all persons regardless of religion, religious belief, a refusal to hold a religious belief, or a refusal to attend or participate in a religious practice; and that there are no religious or membership criteria for tena nts of the Property.

4. Section 3 Requirements. Owner shall ensure compliance with the following Section 3 Requirements. The terms used in this Section shall have the meanings assigned to them in 24 CFR Part 75. Further, Owner shall ensure all Covered Contracts, as defined in 24 CFR Part 75, related to the Project contain the provisions set forth in this Section 4, subsections a through f (the “Section 3 Clause”):
a. The work to be performed under this contract is subject to the requirements of section 3 of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701u (section 3). The purpose of section 3 is to ensure that employment and other economic opportunities generated by HUD assistance or HUD-assisted projects covered by section 3, shall, to the greatest extent feasible, be directed to low- and very low-income persons, particularly persons who are recipients of HUD assistance for housing.
b. The parties to this contract agree to comply with HUD's regulations in 24 CFR part 75, which implement section 3. As evidenced by their execution of this contract, the parties to this contract certify that they are under no contractual or other impediment that would prevent them from complying with the part 75 regulations. c. The contractor agrees to send to ea ch labor organization or representative of workers with which the contractor has a collective bargaining agreement or other understanding, if any, a notice advising the labor organization or workers' representative of the contractor's commitments under thi s section 3 clause, and will post copies of the notice in conspicuous places at the work site where both employees and applicants for training and employment positions can see the notice. The notice shall describe the section 3 preference, shall set forth minimum number and job titles subject to hire, availability of apprenticeship and training positions, the qualifications for each; and the name and location of the person(s ) taking applications for each of the positions; and the anticipated date the work s hall begin. d. The contractor agrees to include this section 3 clause in every subcontract subject to compliance with regulations in 24 CFR part 75, and agrees to take appropriate action, as provided in an applicable provision of the subcontract or in this s ection 3 clause, upon a finding that the subcontractor is in violation of the regulations in 24 CFR part 75. The contractor will not subcontract with any subcontractor where the contractor has notice or knowledge that the subcontractor has been found in violation of the regulations in 24 CFR part 75. e. The contractor will certify that any vacant employment positions, including training positions, that are filled (1) after the contractor is selected but before the contract is executed, and (2) with persons ot her than those to whom the regulations of 24 CFR part 75 require employment opportunities to be directed, were not filled to circumvent the contractor's obligations under 24 CFR part 75.
f. Noncompliance with HUD's regulations in 24 CFR part 75 may result in sanctions, termination of this contract for default, and debarment or suspension from future HUD assisted contracts. g. With respect to work performed in connection with section 3 covered Indian housing assistance, section 7(b) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450e) also applies to the work to be performed under this contract. Section 7(b) requires that to the greatest extent feasible (i) preference and opportunities for training and employment shall be given to Indians, and (ii) preference in the award of contracts and sub contracts shall be given to Indian organizations and Indian-owned Economic Enterprises. Parties to this contract that are subject to the provisions of section 3 and section 7(b) agree t o comply with section 3 to the maximum extent feasible, but not in derogation of compliance with section 7(b).

5. Property Standards. Upon completion, the Project will comply with the applicable property standards of 24 CFR §

92.251. For the term of these F unding Requirements, Owner shall provide Agency access at all reasonable times for inspection to assure compliance with such standards. Such provisions are generally as follows:
a. If the Project is new construction, it must meet all applicable local codes, rehabilitation standards, ordinances, and zoning ordinances at the time of project completion. Newly constructed housing must meet the current edition of the Model Energy Code published by the Council of American Building Officials. b. All other HOME -assisted housing (such as acquisition) must meet all applicable State and local housing quality standards and code requirements.

Construction and Permanent Loan Agreement Page 101
c. The housing must meet the accessibility requirements at 24 CFR part 8, which implements Section 504 of the Rehabilitation Act of 1973 (29 United States Code (USC) Section 794) and covered multifamily dwellings, as defined at 24 CFR §100.201, must also meet the design and construction requirements at 24 CFR §100.205, which implement the Fair Housing Act (42 USC §§ 3601et. seq.).
d. Construction of all manufactured housing must meet the Manufactured Home Construction and Safety Standards established in 24 CFR Part 3280. These standards pre -empt State and local codes covering the same aspects of performance for such housing. Also, installation of manufactured housing units must comply with applicable State and local laws or codes, or in the absence of such laws or codes, the participating jurisdiction must comply with the manufacturer's written instructions for installation of manufactured housing units. Manufactured housing that is rehabilitated using HOME funds must meet the requirements set out in Section 4.a. e. Owner must maintain the housing in compliance with all applicable State and local housing quality standards and code requirements and if there are no such standards or code requirements, the housing must meet the housing quality standards in 24 CFR §982.401.

6. Lead-Based Paint. Owner shall comply with the Lead -Based Paint Poisoning Prevention Act (42 USC §4821et. seq.), the Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C. §4851et. seq.), and implementing regulations.

7. Affordability Requirements. Owner shall assure that the of HOME Restricted Units shall be rented at or below the following rates:
a. Low-Income Units shall be rented for amounts that do not exceed thirty percent (30%) of sixty-five percent (65%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development (“ HUD”), as adjusted for family size appropriate to the size and number of bedrooms in the respective HOME Restricted Unit, provided however that if the tenant is paying for utilities and services for the HOME Restricted Unit, the rent shall not exceed the m aximum amount calculated as set forth in this subdivision minus a monthly allowance for utilities and services as set forth in the maximum monthly allowances for utilities and services established and updated annually by the Agency pursuant to 24 CFR §92.2 52(d). b. Very Low-Income Units shall be rented for amounts that do not exceed thirty percent of fifty-percent (50%) of the Median Income as adjusted for family size appropriate to the size and number of bedrooms in the respective HOME Restricted Unit, provided however that if the tenant is paying for utilities and services for the HOME Restricted Unit, the rent shall not exceed the maximum amount calculated as set forth in this subdivision minus a monthly allowance for utilities and services as set forth in t he maximum monthly allowances for utilities and services established and updated annually by the Agency pursuant to 24 CFR §92.252(d).
c. Notwithstanding any other provision, the maximum rent on any HOME -Restricted Unit shall not exceed the “Fair Market Rent” as established by HUD under 24 CFR §888.111. d. Unless Owner has obtained prior written Agency authorization, Owner shall maintain the allocation of HOME-Restricted Units by the bedroom sizes stated in the Regulatory Agreement. e. Such maximum rent limits shall be recalculated periodically after HUD determination of the Fair Market Rent or the Median Income; provided, however, that the rents are not required to be lower than the initial rent for the HOME- Restricted Units. Owner shall give tenants not less than thirty (30) days’ notice of a change in rents. f. The Agency shall review and approve rents proposed by Owner for the HOME Restricted Units, subject to the maximum rent limitations as set forth in section 6(a), (b) and (c) of this Agreement. The Agency will provide Owner with information on updated HOME rent limits. Owner must annually provide the Agency with information on rents and occupancy of HOME Restricted Units to demonstrate compliance with this Section 6. The Agency must review rents for compliance and approve or disapprove them every year.
g. The foregoing affordability requirements may, with the consent of the Agency, terminate on foreclosure or deed in lieu of foreclosure; provided, however, that the affordability requirements will revive according to the original terms if the Owner at the time of foreclosure, or any entity that includes such Owner or anyone with whom such Owner has or had family or business ties, obtains an ownership interest in the Project or Property.

Construction and Permanent Loan Agreement Page 102

8. Occupancy Requirements. Owner shall assure that all HOME Restricted Rental Units shall be initially occupied by households earning less than sixty -five percent (65%) of the Median Income, as verified by the Agency. Notwithstanding any other provision, if five or more units in the Pr oject are HOME -Restricted Units, not less than twenty percent of the HOME-Restricted Units shall be Very Low -Income Units and shall be occupied by families whose annual income does not exceed fifty-percent (50%) of the Median Income. If a tenant of a HOME -Restricted Unit no longer qualifies as for the HOME-Restricted Unit as a result of an increase in family income, the HOME -Restricted Unit continues to qualify under these Funding Requirements so long as actions satisfactory to HUD are being taken to ensur e that all vacancies are filled in accordance with these Funding Requirements until the noncompliance is corrected. Such tenants shall pay as rent the lesser of the amount payable by the tenant under State or local law or thirty percent (30%) of the famil y’s adjusted income, except that tenants of HOME -assisted units that have been allocated low -income housing tax credits by a housing credit agency pursuant to section 42 of the Internal Revenue Code of 1986 (26 USC Section 42) must pay rent governed by suc h section.

In addition, for projects where HOME units are designated as floating pursuant to 24 CFR §92.252(j), tenants who no longer qualify as low-income are not required to pay as rent an amount that exceeds the market rent for comparable, unassisted units in the neighborhood. If the HOME -Restricted Units are not occupied by eligible tenants within six months following the date of Project completion, Owner shall, in accordance with the requirements of 24 CFR §92.252, submit marketing information to Agency and to HUD and, if appropriate, submit a marketing plan. If any HOME-Restricted Unit has not been rented to eligible tenants 18 months after the date of project completion, Owner shall repay the HOME funds invested in such HOME-Restricted Unit to HUD.

9. Income Verification. Owner shall fully cooperate with Agency by requiring every prospective tenant of a HOME Restricted Unit to provide to Owner, prior to initial occupancy of a H OME-Restricted Unit and annually, all information required to verify incom e-eligibility of the prospective tenant to assure income eligibility in accordance with 24 CFR §

92.203. For the initial eligibility determination, Owner shall cause the tenant to provide the Agency with at least two months of source documents evidencing annual income (by way of example, wage statement, interest statement, unemployment compensation statement) for the family. Thereafter, Owner shall cause the tenant to provide the Owner with such source documents; a written statement of the amount of the f amily's annual income and family size, with a certification that the information is complete and accurate and assurance that the family will provide source documents upon request; or a written statement from the administrator of a government program under which the family receives benefits and which examines each year the annual income of the family, stating the tenant's family size and the amount of the family's annual income or alternatively, stating the current dollar limit for very low or low -income families for the family size of the tenant and state that the tenant's annual income does not exceed such limit.

10. Tenant Protections; Lease Provisions . Owner shall comply with the following provisions for protection of tenants in HOME-Restricted Units.
a. Owner shall enter into an initial lease with a tenant of a HOME -Restricted Unit for not less than one year, unless by mutual agreement between the tenant and the Owner and not required by Owner as a condition of entering into the lease. Such lease shall not contain any of the following provisions, in addition to any other applicable requirements of law:
i. Agreement by the tenant to be sued, to admit guilt, or to a judgment in favor of the Owner in a lawsuit brought in connection with the lease;
ii. Agreement by the t enant that the Owner may take, hold, or sell personal property of household members without notice to the tenant and a court decision on the rights of the parties; excepting an agreement by the tenant concerning disposition of personal property remaining in the housing unit after the tenant has moved out of the unit that is in accordance with State law;
iii. Agreement by the tenant not to hold the Owner or the Owner's agents legally responsible for any action or failure to act, whether intentional or negligent; iv. Agreement of the tenant that the Owner may institute a lawsuit without notice to the tenant; v. Agreement by the tenant that the Owner may evict the tenant or household members without instituting a civil court proceeding in which the tenant has the opportunity to present a defense, or before a court decision on the rights of the parties;
vi. Agreement by the tenant to waive any right to a trial by jury;

Construction and Permanent Loan Agreement Page 103
vii. Agreement by the tenant to waive the tenant's right to appeal, or to otherwise challenge in court, a court decision in connection with the lease; and
viii. Agreement by the tenant to pay attorney's fees or other legal costs, even if the tenant wins in a court proceeding by the Owner against the tenant. The tenant, however, may be obligated to pay costs if the tenant los es. ix. Agreement by the tenant (other than a tenant in transitional housing) to accept supportive services that are offered.
b. An Owner may not terminate the tenancy or refuse to renew the lease of a tenant of rental housing assisted with HOME funds except for serious or repeated violation of the terms and conditions of the lease; for violation of applicable Federal, State, or local law; for completion of the tenancy period for transitional housing or failure to follow any required transitional housing supportive services plan; or for other good cause. Good cause does not include an increase in the tenant’s income or refusal of the tenant to purchase the housing. To terminate or refuse to renew tenancy, the Owner must serve written notice upon the tenant specifying the grounds for the action at least 30 days before the termination of tenancy. c. Owner must adopt and follow written tenant selection policies and criteria that:
i. Limit the housing to very low-income and low-income families; ii. Are reasonably related to program eligibility and the applicants' ability to perform the obligations of the lease (i.e., to pay the rent, not to damage the housing; not to interfere with the rights and quiet enjoyment of other tenants);
iii. Limit eligibility or give a preference to a p articular segment of the population if required in the Loan Documents (and only if the limitation or preference is described in the Agency’s consolidated plan).

1. Any limitation or preference must not violate nondiscrimination requirements in 24 CFR §92.350. A limitation or preference does not violate nondiscrimination requirements if the housing also receives funding from a Federal program that limits eligibility to a particular segment of the population (e.g., the Housing Opportunity for Persons with AIDS program under 24 CFR Part 574, the Shelter Plus Care program under 24 CFR Part 582, the Supportive Housing program under 24 CFR Part 583, supportive housing for the elderly or persons with disabilities under 24 CFR Part 891), and the limit or preference is tailored to serve that segment of the population.

2. If the Project does not receive funding from a Federal program that limits eligibility to a particular segment of the population, the project may have a limitation or preference for persons with disabilitie s who need services offered at a project only if:
a. The limitation or preference is limited to the population of families (including individuals) with disabilities that significantly interfere with their ability to obtain and maintain housing; b. Such families will not be able to obtain or maintain themselves in housing without appropriate supportive services; and
c. Such services cannot be provided in a non-segregated setting. The families must not be required to accept the services offered at the Project. In adve rtising the Project, Owner may advertise the Project as offering services for a particular type of disability; however, the Project must be open to all otherwise eligible persons wi th disabilities who may benefit from the services provided in the Project. iv. Provide for the selection of tenants from a written waiting list in the chronological order of their application, insofar as is practicable; and
v. Give prompt written notification to any rejected applicant of the grounds for any rejection. d. Owner shall not re fuse to lease a HOME -Restricted unit to a certificate or voucher holder under 24 CFR Part 982 – Section 8 Tenant -Based Assistance: Unified Rule for Tenant -Based Assistance under the Section 8 Rental Certificate Program and the Section 8 Rental Voucher Prog ram or to the holder of a comparable document evidencing participation in a HOME tenant -based rental assistance program because of the status of the tenant as a holder of such certificate, voucher or comparable certification.

Construction and Permanent Loan Agreement Page 104

11. Unit Quality & Determination of Cost Allocation. OWNER shall assure that HOME Restricted Units assisted with HOME Funds must be comparable in size and amenities to other units in the Project. If the assisted and non -assisted units are comparable in terms of size, features and number of bedrooms, the actual cost of the HOME Restricted units can be determined by pro -rating the total HOME eligible development costs of the Project so that the proportion of the total development costs charged to the HOME program does not exceed the proport ion of the HOME Restricted units in the Project. If the assisted and non-assisted units are not comparable, the actual costs may be determined based on a method of cost allocation.

12. Compliance With Loan Documents . Owner shall comply with any and all appl icable provisions of the Loan Agreement for so long as they continue to be in effect.

13. Repayment On Default Or Early Termination . If the Agency determines the Project does not comply with HOME requirements for affordability as specified in 24 CFR §§ 92.252 or 92.254; or if the Project is terminated before completion, either voluntarily or otherwise; or if Owner does not comply with these funding restrictions; or if the Project is determined to be an ineligible activity under HOME, Owner must repay to Agency any HOME Funds invested in the Project upon demand.

14. Program Income. If Project income is considered to be HOME program income, it shall nevertheless be paid to or retained by Owner in accordance with the agreement between Agency and Owner.

15. Administrative Requirements . Owners that are governmental or non -profit organizations shall comply with the provisions of 24 CFR §92.505 regarding uniform administrative requirements. Owner shall cooperate fully with the Agency and provide all documents and records required by Agency in preparing for HOME related audits. Owner shall comply with all applicable requirements under HOME, including without limitation, recordkeeping and reporting.

16. Governmental Entities, Non-Profits, CHDOS. Special HOME regulations apply t o an Owner that is governmental or non-profit entities or a community housing development organization. Such Owner is responsible for knowledge of and shall fully comply with such regulations.

17. Term. These covenants shall burden and regulate the HOME Rest ricted Units assisted with HOME Funds for the following term as applicable, unless a longer term is specified in the body of the document to which this attached:
a. For rehabilitation or acquisition of existing housing, five (5) years if the subsidy for each of HOME - Restricted Unit is less than $15,000;
b. For ten (10) years if such subsidy is $15,000 or more but not more than $40,000; c. For fifteen (15) years if such su bsidy is more than $40,000 or if the project involves refinancing of an existing loan; and
d. For new construction or acquisition of newly constructed housing, twenty (20) years.

18. No Termination On Recapture. Notwithstanding any other provisions of the Regulatory Agreement, the provisions of these HOME Funding and Other Federal Requirements shall continue for the duration of the applicable preceding term.

Construction and Permanent Loan Agreement Page 105
Exhibit 7b: HTF Funding Requirements

HTF FUNDING REQUIREMENTS
HOUSING TRUST FUND – CITY OF SACRAMENTO

FINANCING FOR RESIDENTIAL RENTAL PROPERTY

These “HTF Funding Requirements” are attached to a Regulatory Agreement, and are incorporated in that Regulatory Agreement. In turn, the Regulatory Agreement is incorporated in the Loan that is described in the R egulatory Agreement.

The capitalized terms used in these HTF Funding Requirements shall have the meanings below in the body of the these HTF Funding Requirements. Terms being defined are indicated by quotation marks. Capitalized terms in these HTF Funding Requirements that are not defined below are defined in the Regulatory Agreement.

13. RECITALS. The Loan is funded by the Agency with proceeds of the Housing Trust Fund (“HTF”)of the City of Sacramento. The Agency has approved the Loan on condition that the property securing the Loan (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with the HTF (“HTF-Assisted Units”) by recordation of these HTF Funding Restrictions as covenants ru nning with the land. The Project has been determined to be within a seven mile distance from the non-residential projects generating the funds or has access to existing or planned public transit such that it is reasonable that tenants of the Project could commute from the Project to the non-residential projects generating the funds. The Project conforms to any City “Fair Share” plan currently adopted and in effect. HTF-Assisted Units are made affordable by such regulation to persons and households that qu alify as low- income or very low-income as indicated in the table in Article I of the Regulatory Agreement. The development of the Project will benefit the Project Area because the Project will provide housing for persons who work within the Project Area. The Project is located within the City of Sacramento (“City”). Most Project Area workers live outside of the Project Area and come from throughout the City, including the vicinity of the Property.

14. AFFORDABILITY REQUIREMENTS. Owner shall assure that all of the HTF-Assisted Units assisted with HTF funds shall be rented at or below the following rates:

a. Low-Income Units shall be rented for not more than thirty percent (30%) of sixty percent (60%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development, as adjusted for family size appropriate to the size and number of bedrooms in the respective HTF-Assisted Unit.

b. Very Low-Income Units shall be rented for not more than thirty percent (30%) of fifty percent (50%) of the Median Income as adjusted for family size appropriate to the size and number of bedrooms in the respective HTF -Assisted Unit.

c. Unless Owner has obtained prior written Agency authorization, Owner shall maintain the allocation of HTF-Assisted Units by the bedroom sizes stated in the Regulatory Agreement.

d. Owner shall be responsible to determine the affordable rents for the HTF-Assisted Units. Within ten (10) days of Owner request, Agency shall provide all information necessary for Owner to compute such affordable rents and will assist Owner in determining such rents.

8. OCCUPANCY REQUIREMENTS. Owner shall assure that all HTF-Assisted Units shall be occupied by households earning less than eighty percent (80%) of Median Income.

9. UNIT QUALITY. Owner shall assure that Assisted Units assisted with HTF funds must be comparable in size and amenities to other units in the Project.

10. TERM. These covenants shall burden and regulate the HTF-Assisted Units for a term of thirty (30) years.

Construction and Permanent Loan Agreement Page 106

Exhibit 7c: MIHF Funding Requirements

EXHIBIT 2A
Funding Requirements

MIHO FUNDING REQUIREMENTS
MIXED INCOME HOUSING – CITY OF SACRAMENTO

FINANCING FOR RESIDENTIAL RENTAL PROPERTY

These “MIHO Funding Requirements” are attached to a Regulatory Agreement, and are incorporated in that Regulatory Agreement. In turn, the Regulatory Agreement is incorporated in the Funding Agreement that is described in the Regulatory Agreement. Capitalized terms in these MIHO Funding Requirements that are not defined below are defined in the Regulatory Agreement.

15. RECITALS. The Loan is funded by the Agency with proceeds of the housing impact fees collected pursuant to the M ixed Income Housing Ordinance (“MIHO”) of the City of Sacramento, established by Sacramento City Ordinance Number 2015- 0029. The Agency has approved the Loan on condition that the property securing the Loan (“Property”) is rehabilitated or developed as res idential rental property (“Project”) with certain units regulated in accordance with the MIHO (“MIHO - Restricted Units”) by recordation of these MIHO Funding Restrictions as covenants running with the land. MIHO-Restricted Units are made affordable by such regulation to persons and households that qualify as low-income as indicated herein.

16. AFFORDABILITY REQUIREMENTS. Affordability requirements are established by Sacramento City Code 17.712 et seq. (adopted by Resolution 2015-0294 of the City Council of Sacramento, California, on September 1, 2015). Owner shall assure that the of the MIHO Restricted Units shall be sold at or below the following rates (“Affordable Price”):

a. Low-Income Units shall be rented for amounts that do not exceed thirty percent (30%) of eighty percent (80%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development, as adjusted for family size appropriate to the size and number of bedrooms in the respective MIHO-Assisted Unit.

b. Unless Owner has obtained prior written Agency authorization, Owner shall maintain the allocation of MIHO-Assisted Units by the bedroom sizes stated in the Regulatory Agreement.

c. Owner shall be responsible to d etermine the affordable rents for the MIHO -Assisted Units. Within ten (10) days of Owner request, Agency shall provide all information necessary for Owner to compute such affordable rents and will assist Owner in determining such rents.

11. OCCUPANCY REQUIREMENTS. Owner shall assure that all MIHO-Assisted Units shall be occupied by households whose income does not exceed eighty percent (80%) of Median Income.

12. UNIT QUALITY. Owner shall assure that Assisted Units assisted with MIHO funds must be comparable in size and amenities to other units in the Project.

13. TERM. These covenants shall burden and regulate the MIHO-Assisted Units for a term of thirty (30) years.

Construction and Permanent Loan Agreement Page 107

Exhibit 7d: PLHA Funding Requirements

PERMANENT LOCAL HOUSING ALLOCATION (PHLA) FUNDING REQUIREMENTS

These “PLHA Funding Requirements” are attached to a Regulatory Agreement, and are incorporated in that Regulatory Agreement. In turn, the Regulatory Agreement is incorporated in the Loan that is described in the Regulatory Agreement.

The capitalized terms used in these PLHA Funding Requirements shall have the meanings below in the body of the these PLHA Funding Requirements. Terms being defined are indicated by quotation marks. Capitalized terms in these PLHA Funding Requirements that are not defined below are defined in the Regulatory Agreement.

17. RECITALS. The Loan is funded by the Agency with proceeds of the Permanent Local Housing Allocation Program, established by California SB 2 (Chapter 364, Statutes of 2017) and operating under the requirements of California Health and Safety Code, Part 2 of Division 31, Chapter 2.5 (commencing with Section 50470). The Agency has approved the Loan on condition that the property securing the Loan (“Property”) is rehabilitated or developed as residential rental property (“Project”) with certain units regulated in accordance with PLHA requirements (“PLHA -Assisted Units”) by recordation of these PLHA Funding Restrictions as covenants running with the land.

18. ELIGIBLE ACTIVITIES. Owner shall ensure that PLHA funding is used solely for one or more Eligible Activities. “Eligible Activities” are limited to the following:

a. Development of new multifamily rental housing that is affordable to households at below 60 percent of Area Median Income (AMI) or substantial rehabilitation of multifamily rental housing that will be affordable to households at or below 60 percent of AMI, but which is not currently restricted as affordable housing. In order to be eligible as “substantial rehabilitation”, a project must complete a minimum of $40,000 per unit in hard construction costs; or

b. Assistance to persons who are experiencing or at risk of homelessness, including, but not limited to, thro ugh rapid rehousing, rental assistance, supportive services, and case management services that allow people to obtain and retain housing, operating and capital costs for navigation Centers, or new construction, rehabilitation, or preservation of permanent or transitional rental housing.

19. COMPLIANCE WITH LAWS. Owner shall comply with all laws, rules, regulations, and funding requirements that govern the use of PLHA funds, including but not limited to those listed in this Section 3(a) through 3(f). If Agency, as a result of actions of Owner, is obligated to repay the California Department of Housing and Community Development or the PLHA Program any amount under the PLHA Loan, Owner shall make such repayment on account of Agency and failure to do so shall be an Event of Default under the Funding Agreement.

a. Article XXXIV, Section 1 of the California Constitution, as clarified by the Public Housing Election Implementation Law (California Health and Safety Code (HSC) Section 37000 – 370002).

b. The Pet Friendly Housing Act of 2017 (HSC Section 50466). Further, Owner shall submit to Agency a signed and dated certification that all residents of the PLHA-funded Project will be authorized to own or otherwise maintain one or more common household pets as required by HSC Section 50466 for the entire term of the Regulatory Agreement. Pursuant to the statute, “common household pet” means a domesticated animal, such as a dog or cat, commonly kept in the home for pleasure rather than for commercial purposes.

c. Prevailing Wage Law, as set forth in California Labor Code Section 1720 et seq., requiring the payment of prevailing wages unless the Project meets one of the exceptions of California Labor Code Section 1720(c), as determined by the California Department of Industrial Relations.

Construction and Permanent Loan Agreement Page 108
d. Relocation Law, pursuant to Government Code Section 7260 et. seq., Title 25 of the California Code of Regulations Section 6000 et. seq., and if federal law is applicable, Code of Federal Regulations (CFR) at 49 CFR Part 24 of the UMRs and Real Property Acquisition for Federal and Federally Assisted Programs.

e. The accessibility requirements set forth in California Building Code Chapter 11A and 11B and the Americans with Disabilities Act, Title II. In addition, Owner shall ensure the Project complies with either the Uniform Federal Accessibility Standards (UFAS) standards, 24 CFR Part 8, or HUD's modified version of the 2010 Americans with Disabilities Act (ADA) Standards for Accessible Design (Alternative 2010 ADAS), HUD -2014-0042-0001, Federal Register, 79 FR 29671 (5/27/14) (commonly referred to as "the Alternative Standards" or "HUD Deeming Memo"), whichever applies to the Project. Accessibly units shall, to the maximum extent feasible and subject to reasonable health and safety requirements, be distributed throughout the project and be available in a sufficient range of sizes and amenities consistent with 24 CFR Section 8.26.

f. The Americans with Disabilities Act, the Fair Housing Amendments Act, the California Fair Employment and Housing Act, the Unruh Act, Government Code Section 11135, Rehabilitation Act Section 504, and regulations promulgated pursuant to those statutes, including 24 CFR Part 100, 24 CFR Part 8, and 28 CFR Part 35.

20. NON-DISCRIMINATION POLICY. Owner shall adopt a written non-discrimination policy requiring that no person shall, on the grounds of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, age, medical condition, genetic information, citizenship, primary language, immigration status (except where explicitly prohibited by federal law), arbitrary characteristics, and all other classes of individuals protected from discrimination under state or federa l fair housing laws, individuals perceived to be a member of any of the preceding classes, or any individual or person associated with any of the preceding classes be excluded from participation in, be denied the benefits of, or be subjected to discriminat ion under, any program or activity funded in whole or in part with PLHA funds.

21. AFFORDABILITY REQUIREMENTS. Owner shall ensure that all of the Restricted Units assisted with PLHA funds are rented at or below sixty percent (60%) of the Sacramento Metropolitan Statistical Area median income (“Median Income”), as determined annually by the federal Department of Housing and Urban Development, as adjusted for family size appropriate to the size and number of bedrooms in the respective Restricted Unit.

22. OCCUPANCY REQUIREMENTS. Owner shall ensure that all Restricted Units are occupied by households earning less than sixty percent (60%) of Median Income.

23. UNIT QUALITY. Owner shall ensure that Restricted Units assisted with PLHA funds are comparable in size and amenities to other units in the Project, especially, if applicable, units in the Project that are not subject to restrictions regarding maximum rent or maximum household income.

24. TERM. These covenants shall burden and regulate the Restricted Units for a term of fifty -five (55) years.

Attachment 8
On Broadway Apartments – Project Renderings
View from Broadway and 19th Street
View from X Street and 19th Street

Attachment 8
View from Broadway and Railway
View from 19th Street

Attachment 9
Address
Number of Units
Year Built
Acreage
No Place Like Home (NPLH) Units
Unit Mix and Rents
ELI 30% AMI
NPLH & PBV VLI 50% AMI LI 60% AMI
Exempt
Management Units Total
1 Bedroom/1 Bath 32 19 17 0 68
2 Bedroom/1 Bath 4 16 15 1 36
3 Bedroom/2 Bath 1 17 17 1 36
Total Units 37 52 49 2 140
Square Footage Per Unit Total
1 Bedroom/1 Bath 626 42,568 sq.ft.
2 Bedroom/1 Bath 880 31,680 sq.ft.
3 Bedroom/2 Bath 1,101 39636 sq.ft.

Community Area 5,355 5,355 sq.ft.

Total Gross 119,239 sq.ft.

Resident Facilities
Permanent Sources Total Per Unit Per Square Foot
Federal Tax Credit Equity $42,584,565 $304,175 $357
Senior Loan $6,371,000 $45,507 $53
Accrued Deferred Interest - GP $299,691 $2,141 $3
SHRA (HOME, HTF, MIHF, PLHA) Loan $7,300,000 $52,143 $61 Aff Housing & Sustainable Communities $18,446,000 $131,757 $155 No Place Like Home $9,280,317 $66,288 $78 $0Deferred Developer Fee $7,982,154 $57,015 $67 General Partner Equity $100 $1 $0
TOTAL SOURCES $92,263,827 $659,027 $774
Permanent Uses Total Per Unit Per Square Foot
Acquisition $6,710,000 $47,929 $56
Construction Costs $57,808,705 $412,919 $485
Architecture & Engineering $1,959,053 $13,993 $16
Permits $1,130,611 $8,076 $9
Hard Cost Contingency $3,965,961 $28,328 $33
Soft Cost Contingency $636,917 $4,549 $5
Financing Cost $7,460,042 $53,286 $63
Capitalized Replacement Reserve $70,000 $500 $1
Capitalized Operating Reserve $469,435 $3,353 $4
Legal Fees $195,000 $1,393 $2
Developer Fee $10,182,154 $72,730 $85
Third Party Fees, Marketing, Other $1,675,949 $11,971 $14 TOTAL USES $92,263,827 $659,027 $774
SHRA $ per Unit Per Unit Cost
$52,143 $659,027 $1.00 : $13
Management / Operations
Proposed Developer
Property Management Company
Operating Expenses $861,510 $6,154
Property Management Fee $116,978 $836
Resident Services $88,798 $634
Replacement Reserves $70,000 $500
Taxes and Insurance $172,413 $1,232
New Construction
On Broadway
Residential Project Summary
1901 Broadway
140

1.25 acres (54,450 sq. ft.)
37 of the 140 units will be designated as NPLH
Management and services offices and meeting rooms, two community rooms, two laundry facilities, four elevators, four community restrooms, indoor bicycle storage, two play areas with playgrounds for school aged children, picnic areas, landscaped courtyards and 60 on-grade parking spaces.

EAH Housing, Inc.

EAH Housing, Inc.
¹Pursuant to 24CFR 983.301, contract rents approved by HUD may exceed the tax-credit rent limits; and the AMI change is due to income averaging regulation by CDLAC. The tenant rent will not exceed 30% of the household adjusted gross income with PBV.

Leverage
Leverage
On Broadway Apartments Square Total Max Gross Utility Max Net Rent per Total Mo. Current Unit Type Number Feet Sq Feet Rent Allowance Rent Sq Foot Rent Annual Rent 1 Bedroom/1 Bath (30% AMI) NPLH/PBV units 32 626 20,032 570$ 73$ 497$ 0.79$ 15,904$ 190,848$ 1 Bedroom/1 Bath (50% AMI) 19 626 11,894 950$ 73$ 877$ 1.40$ 16,663$ 199,956$ 1 Bedroom/1 Bath (60% AMI) 17 626 10,642 1,140$ 73$ 1,067$ 1.70$ 18,139$ 217,668$ 2 Bedroom/1 Bath (30% AMI) NPLH/PBV units 4 880 3,520 684$ 93$ 591$ 0.67$ 2,364$ 28,368$ 2 Bedroom/1 Bath (50% AMI) 16 880 14,080 1,140$ 93$ 1,047$ 1.19$ 16,752$ 201,024$ 2 Bedroom/1 Bath (60% AMI) 15 880 13,200 1,368$ 93$ 1,275$ 1.45$ 19,125$ 229,500$ 3 Bedroom/2 Bath (30% AMI) NPLH/PBV units 1 1,101 1,101 790$ 111$ 679$ 0.62$ 679$ 8,148$ 3 Bedroom/2 Bath (50% AMI) 17 1,101 18,717 1,317$ 111$ 1,206$ 1.10$ 20,502$ 246,024$ 3 Bedroom/2 Bath (60% AMI) 17 1,101 18,717 1,580$ 111$ 1,469$ 1.33$ 24,973$ 299,676$ 2 Bedroom/1 Bath (Exempt Management Unit) 1 880 880 -$ -$ -$ -$ -$ -$ 3 Bedroom/1 Bath (Exempt Management Unit) 1 1,101 1,101 -$ -$ -$ -$ -$ -$ Totals 140 92,751 135,101$ 1,621,212$
¹Pursuant to 24CFR 983.301, contract rents approved by HUD may exceed the tax-credit rent limits; the tenant rent will not exceed 30% of the household adjusted gross income with PBV.

Annual 2023 2024 2025 2026 2027 2032 2033 2034 2035 2036 2037 2042 2052 Income increase per unit Year 1 Year 2 Year 3 Year 4 Year 5 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Year 20 Year 30 Potential Gross Income 2.50% 1,703,286 1,745,868 1,789,515 1,834,253 1,880,109 2,127,171 2,180,350 2,234,859 2,290,730 2,347,998 2,406,698 2,722,958 3,485,617 Rental Subsidy 2.50% 478,908 490,881 503,153 515,732 528,625 598,091 613,043 628,369 644,079 660,181 676,685 765,607.15 980,041.89 Other Income 2.50% 17,420 17,769 18,124 18,487 18,856 20,819 21,235 21,660 22,093 22,535 22,986 25,378 30,936 Less Vacancy 5.00% 109,110 111,837 114,633 117,499 120,437 136,263 139,670 143,161 146,740 150,409 154,169 174,428 223,283 Effective Gross Income $2,090,505 $2,142,681 $2,196,159 $2,250,972 $2,307,154 $2,609,818 $2,674,959 $2,741,727 $2,810,162 $2,880,305 $2,952,200 $3,339,515 $4,273,312 Operating Expenses
Operating Expenses 3.50% 6,154 861,510 891,663 922,871 955,172 988,603 1,174,150 1,215,245 1,257,779 1,301,801 1,347,364 1,394,522 1,656,255 2,336,311 Property Management 3.50% 836 116,978 121,072 125,310 129,695 134,235 159,429 165,009 170,784 176,761 182,948 189,351 224,890 317,229 Residential Services 3.50% 634 88,798 91,906 95,123 98,452 101,898 121,023 125,259 129,643 134,180 138,876 143,737 170,715 240,810 Replacement Reserves 0.42% 500 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 70,000 Taxes and Insurance 2.00% 1,232 172,413 175,861 179,378 182,966 186,625 206,050 210,170 214,374 218,661 223,035 227,495 251,173 306,179 Total Expenses $1,309,699 $1,350,502 $1,392,682 $1,436,285 $1,481,361 $1,730,651 $1,785,683 $1,842,579 $1,901,404 $1,962,223 $2,025,105 $2,373,032 $3,270,528 Net Operating Income $780,806 $792,178 $803,477 $814,687 $825,793 $879,167 $889,276 $899,148 $908,758 $918,082 $927,095 $966,483 $1,002,783 Debt Service amount rate amort
Senior Loan $6,371,000 6.60% 30 488,318 488,318 488,318 488,318 488,318 488,318 488,318 488,318 488,318 488,318 488,318 488,318 488,318 SHRA Monitoring Fee $55,000,000 0.125% 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 25,000 HCD Monitoring Fee $9,280,317 0.420% 38,977 38,977 38,977 38,977 38,977 38,977 38,977 38,977 38,977 38,977 38,977 38,977 38,977 Debt Service Subtotal $552,295 $552,295 $552,295 $552,295 $552,295 $552,295 $552,295 $552,295 $552,295 $552,295 $552,295 $513,318 $513,318 Priority Distributions
Asset Management Fee (GP) $16,500 3.00% 16,500 16,995 17,505 18,030 18,571 21,529 22,175 22,840 23,525 24,231 24,958 28,933 38,883 Partnership Management Fee (LP) $8,500 3.00% 8,500 8,755 9,018 9,288 9,567 11,091 11,423 11,766 12,119 12,483 12,857 14,905 20,031 Priority Distributions Subtotal $25,000 $25,750 $26,523 $27,318 $28,138 $32,619 $33,598 $34,606 $35,644 $36,713 $37,815 $43,838 $58,914 Net Cash after Priority Distributions $203,511 $214,133 $224,659 $235,073 $245,360 $294,252 $303,383 $312,246 $320,818 $329,073 $336,985 $409,328 $430,551 Deferred Developer Fee
Principal Balance $7,982,154 0.00% 7,982,154 7,778,643 7,564,510 7,339,851 7,104,778 5,778,275 5,484,023 5,180,640 4,868,394 4,547,575 4,218,502 2,306,445 0 Payment 203,511 214,133 224,659 235,073 245,360 294,252 303,383 312,246 320,818 329,073 336,985 409,328 0 Balance $7,778,643 $7,564,510 $7,339,851 $7,104,778 $6,859,418 $5,484,023 $5,180,640 $4,868,394 $4,547,575 $4,218,502 $3,881,517 $1,897,118 $0 Net Cash after Deferred Developer Fee $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $430,551 Investor Cash Flow
Residential NOI after Debt Service, Priority Distributions & Deferred Developer Fee $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $215,276 HCD No Place Like Home (NPLH) Loan
Principal Balance $9,280,317 3.00% 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 9,280,317 Interest for Period 278,410 278,410 278,410 278,410 278,410 278,410 278,410 278,410 278,410 278,410 278,410 278,410 278,410 Accumulated Interest 278,410 556,819 835,229 1,113,638 1,392,048 2,784,095 3,062,505 3,340,914 3,619,324 3,897,733 4,176,143 5,568,190 8,223,531 Payment 0 0 0 0 0 0 0 0 0 0 0 0 28,519
Balance $9,558,727 $9,837,136 $10,115,546 $10,393,955 $10,672,365 $12,064,412 $12,342,822 $12,621,231 $12,899,641 $13,178,050 $13,456,460 $9,558,727 $9,530,208 Affordable Housing and Sustainable Communities (AHSC)
Principal Balance $18,446,000 3.00% 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 18,446,000 Interest for Period 553,380 553,380 553,380 553,380 553,380 553,380 553,380 553,380 553,380 553,380 553,380 553,380 553,380 Accumulated Interest 553,380 1,106,760 1,660,140 2,213,520 2,766,900 5,533,800 6,087,180 6,640,560 7,193,940 7,747,320 8,300,700 11,067,600 16,345,481 Payment 0 0 0 0 0 0 0 0 0 0 0 0 56,686
Balance $18,999,380 $19,552,760 $20,106,140 $20,659,520 $21,212,900 $23,979,800 $24,533,180 $25,086,560 $25,639,940 $26,193,320 $26,746,700 $29,513,600 $34,734,795 SHRA Loan
Principal Balance $7,300,000 3.00% 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 7,300,000 Interest for Period 219,000 219,000 219,000 219,000 219,000 219,000 219,000 219,000 219,000 219,000 219,000 219,000 219,000 Accumulated Interest 219,000 438,000 657,000 876,000 1,095,000 2,190,000 2,409,000 2,628,000 2,847,000 3,066,000 3,285,000 4,380,000 6,468,720 Payment 0 0 0 0 0 0 0 0 0 0 0 0 22,433
Balance $7,519,000 $7,738,000 $7,957,000 $8,176,000 $8,395,000 $9,490,000 $9,709,000 $9,928,000 $10,147,000 $10,366,000 $10,585,000 $7,519,000 $7,496,567 Attachment 10 On Broadway Apartments
Cash Flow Proforma
Attachment 11
Family Size 30% AMI 50% AMI 60% AMI
1 person 21,300$ 35,500$ 42,600$
2 person 24,350$ 40,550$ 48,660$
3 person 27,400$ 45,600$ 54,720$
4 person 30,400$ 50,650$ 60,780$
5 person 32,850$ 54,750$ 65,700$
6 person 35,300$ 58,800$ 70,560$
7 person 37,700$ 62,850$ 75,420$
Unit Size 30% AMI 50% AMI 60% AMI
1 Bedroom 570$ 950$ $ 1,140
2 Bedroom 685$ 1,140$ $ 1,368
3 Bedroom 790$ 1,317$ $ 1,581
¹Pursuant to 24CFR 983.301, contract rents approved by HUD may exceed the tax-credit rent limits; and the AMI change is due to income averaging regulation by CDLAC. The tenant rent will not exceed 30% of the household adjusted gross income with PBV.

On Broadway Apartments
MAXIMUM INCOME AND RENT LIMITS 2023
Rents at 30%, 50% and 60% Area Median Income (AMI)
Low Income Housing Tax Credits, Mortgage Revenue Bonds, No Place Like Home, Affordable Housing and Sustainable Communities Program, HOME Investment Partnerships Program, Housing Trust Funds, Mixed Income Housing Funds, and Permanent Local Housing Allocation
Maximum Gross Income Limits
Maximum Gross Rent Limits¹