Affordable Housing Agreement between the City of Simi Valley and Affordable Housing Land Consultants LLC (AHA-2025-0002) for the proposed Tapo Street Apartments located at 2267 Tapo Street

City of Simi Valley
Staff Report
J
une 8, 2026
To: Cit
y Council
Fr
om: Department of Environmental Services
Stratis Perros, Environmental Services Director
Subj
ect: Affordable Housing Agreement between the City of Simi Valley and Affordable Housing Land Consultants LLC (AHA-2025-0002) for the proposed Tapo Street Apartments located at 2267 Tapo Street
Sta
ff Recommendation
I
t is recommended that the City Council:

1. Adop
t Resolution No. 2026-17 (Attachment A), approving the Affordable Housing Agreement (AHA -2025-0002, Attachment B) for the development of the Tapo Street Apartments located at 2267 Tapo Street pursuant to ministerial P lanned Development Permit No. PD-S-2025-0007; and

2. A
uthorize the City Manager to administratively approve and execute the Assignment and Assumption of the Affordable Housing Agreement (AHA -2025- 0002, Attachment C) to 2267 Tapo St Ground Owner LP; and

3. A
uthorize the City Manager to administratively approve and execute the Amended and Restated Affordable Housing Agreement for the development of the Tapo Street Apartments located at 2267 Tapo Street pursuant to ministerial Planned Development Permit No. PD-S-2025-0007 (Attachment D).

Ba
ckground
O
n June 23, 2025, City staff received an A ffordable Housing Agreement Application (Attachment E) from AMG and Associates, LLC (Applicant), with the consent of Affordable Housing Land Consultants LLC (Property Owner) for the development of a 240- unit apartment complex with 48 units set aside for very -low income (50% of Area Median Income) qualified renters , 190 units set aside for low -income (60% of the Area Median Income) qualified renters and two market rate manager units for fifty-five (55) years. The project is located at 2267 Tapo Street and is approved pursuant to Ministerial Planned Development Permit No. PD-S-2025-0007. The property is located within the Mixed-Use Land Use designation of the General Plan, and within the Tapo Mixed-Use district of the Envision Simi Valley Specific Plan (ESVSP) (hereinafter Project). AMG and Associates, LLC has previously completed a similar project with the Alamo Street Apartments (AHA - R-61), which was approved by the City Council on November 9, 2020.

Agenda Item No.

9A
Discussion

The Applicant is proposing to build a 100% affordable apartment complex , which is receiving $55,000,000 of the 2025 State Ceiling on Qualified Private Activity Bonds from the California Municipal Finance Authority as secured by Resolution No. 25- 199 (Attachment F) with the California Debt Limit Allocation Committee (CDLAC). The project is also receiving $5,570,977 in F ederal Tax Credits annually for ten years from t he California Tax Credit Allocation Committee (CTCAC) (Attachment G). The C ity is not providing any financial assistance for the project.

The Applicant is invoking the “By Right” development procedures stated in Assembly Bill No. 1397. The bill requires certain Housing Element sites identified to accommodate lower-income housing needs to be zoned to permit owner-occupied and rental multifamily residential development by right for projects in which at least 20 percent of the units are affordable to lower -income households during the planning period. In addition, the Applicant is invoking the Housing Accountability Act ( Government Code § 65589.5), which offers protection for housing developments that provide at least 20% of their units for lower-income households as defined by Health and Safety Code § 50079.5. Section 50079.5 defines lower-income households as those earning 80% of Area Median Income (AMI). This project will designate 100% of its affordable units for those earning up to 80% AMI and therefore qualifies for protection under subdivision (d) of the Housing Accountability Act. State Density Bonus Law (SDBL) (Government Code § 65915) allows for an 80% density bonus when 100% of a project’s units are designated to low -income households, with the exception of manager’s units , and would allow the Applicant to request five (5) concessions. Three (3) concessions and five (5) waivers are being requested (Attachment G).

The Applicant has notified the City of its intent to transfer ownership of the property prior to the scheduled closing of the P roject’s construction loan on June 18, 2026. While the City has previously processed Assignment and Assumption requests, the Applicant’s requested timeline presents an accelerated schedule. In response, the City Attorney’s Office has reviewed the request and worked collaboratively with the Applicant to identify an administrative approach to address the transfer in a timely manner.

Upon approval of the AHA by the City Council, the AHA will be executed and subsequently recorded with the County Recorder’s Office. Following this action, the City Manager will administratively approve and execute the Assignment and Assumption Agreement to reflect the transfer in ownership of the P roject from Property Owner to 2267 Tapo St Ground Owner LP. Once executed, the Assignment and Assumption Agreement will also be recorded with the County Recorder’s Office. Due to the Applicant’s financing deadline, both the execution of the AHA and the Assignment and Assumption Agreement must occur concurrently and in an expedited manner to ensure all required documents are finalized and recorded prior to the Project’s construction loan closing deadline of June 18, 2026.

2 As part of the ownership transfer, 2267 Tapo St Ground Owner LP (incoming property owner) is also requesting certain provisions related to assignment and liability.

Specifically, the proposed terms would require City consent prior to any future transfer or assignment of the Project, while allowing the 2267 Tapo St Ground Owner LP to undertake internal organizational restructurings or changes in Project management without City consent. In addition, the proposed terms provide that 2267 Tapo St Ground Owner LP would not be liable to the City for any obligations or debts incurred prior to Project management transfer in the event the ground lease is terminated, and that 2267 Tapo St Ground Owner LP would not be obligated to complete construction of the Project if financing or other project components are no longer viable.

Staff is recommending that the City Council authorize the City Manager to administratively approve and execute the Assignment and Assumption Agreement and the proposed Amended and Restated Affordable Housing Agreement for efficiency purposes, given the time-sensitive nature of the Project’s financing. The proposed Amended and Restated Agreement is included as Attachment D for City Council review and approval.

The applicant has indicated that the project and construction loan closing must occur by June 18, 2026, in order to secure financing. The next regularly scheduled City Council meeting is June 22, 2026, which occurs after the stated financing deadline. A visual timeline of the request is also included for ease of reference below.

PRIOR TO JUNE 18, 2026
AMENDED AND RESTATED AHA WITH 2267 TAPO ST

GROUND OWNER LP

ASSIGNMENT AND ASSUMPTION AGREEMENT

CURRENT PROPERTY OWNER, AFFORDABLE HOUSING

LAND CONSULTANTS LLC TO INCOMING PROPERTY
OWNER, 2267 TAPO ST GROUND OWNER LP

AFFORDABLE HOUSING LAND CONSULTANTS LLC

SIGNS AHA
3 Financial Impact
There are no financial impacts.

City Council Priority
This item supports the City Council’s Thriving Community Pillar of Excellence.

Suggested Motion
I move to adopt Resolution No. 202 6-17 approving the Affordable Housing Agreement (AHA-2025-0002) between the City of Simi Valley and Affordable Housing Land Consultants LLC, for the development of Tapo Street Apartments located at 2267 Tapo Street pursuant to planned development permit (PD-S-2025-0007) and authorize the City Manager to administratively approve and execute the Assignment and Assumption of the Affordable Housing Agreement (AHA-2025-0002) to 2267 Tapo St Ground Owner LP and the Amended and Restated Affordable Housing Agreement with 2267 Tapo St Ground Owner LP.

Summary
On June 23, 2025, City staff received an Affordable Housing Agreement Application from AMG and Associates, LLC (Applicant) for the development of a 240 -unit apartment complex with 48 units set aside for very-low income (50% of Area Median Income) qualified renters, 190 units set aside for low -income (60% of the Area Median Income) qualified renters and two market rate manager units for 55 years. The project is located at 2267 Tapo Street and is approved pursuant to Ministerial Planned Development Permit No. PD-S-2025-0007. The Applicant has previously completed a similar project with the Alamo Street Apartments (AHA -R-61), which was approved by the Cit y Council on November 9, 2020. It is recommended that the City Council adopt Resolution No. 2026- 17, approving the Affordable Housing Agreement (AHA-2025-0002) for the development of the Tapo Street Apartments located at 2267 Tapo Street pursuant to ministerial Planned Development Permit No. (PD-S-2025-0007) and authorize the City Manager to administratively approve and execute the Assignment and Assumption of the Affordable Housing Agreement (AHA -2025-0002) to 2267 Tapo St Ground Owner LP and the Amended and Restated Affordable Housing Agreement with 2267 Tapo St Ground Owner LP.

Prepared by: Daniel Franco, Management Analy
st
Attachments:

Attachment A – Resolution No. 2026- 17
Attachment B – Affordable Housing Agreement (AHA-2025-0002) Attachment C – Assignment and Assumption of the Affordable Housing Agreement (AHA- 2025-0002)
Attachment D – Amended and Restated Affordable Housing Agreement with 2267 Tapo St Ground Owner LP
4 Attachment E – Affordable Housing Agreement Application Attachment F – California Debt Limit Allocation Committee (''CDLAC") Resolution No. 25- 199
Attachment G – California Tax Credit Allocation Committee (CTCAC) Reservation Letter Tax Exempt
Attachment H – Density Bonus Memo
5 Attachment A

RESOLUTION NO. 2026-17

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SIMI VALLEY APPROVING AN AFFORDABLE HOUSING
AGREEMENT (AHA-2025-0002) WITH AFFORDABLE

HOUSING LAND CONSULTANTS, LLC, A CALIFORNIA

LIMITED LIABILITY COMPANY, FOR THE DEVELOPMENT
OF A 240-UNIT APARTMENT COMPLEX INCLUDING TWO-
HUNDRED THIRTY-EIGHT (238) AFFORDABLE UNITS TO

BE RESERVED FOR VERY LOW -INCOME AND LOW -
INCOME HOUSEHOLDS LOCATED AT 2267 TAPO
STREET

WHEREAS, the City Council of the City of Simi Valley (“City Council”) proposes to enter into the certain Affordable Housing Agreement (AHA-2025-0002), attached hereto as Attachment B , w ith Affordable Housing Land Consultants, LLC, a California limited liability company (“ Developer”) for the development of a 240-unit apartment project, containing 238 affordable units (“ Project”), reserved for very low - income and low-income households for a period of f ifty-five (55) years, attached hereto and incorporated herein by reference on a 2.63- acre site (“Site”) located at 2267 Tapo Street, as described in AHA-2025-0002; and

WHEREAS, on June 23, 2025, the Developer has submitted an application for an Affordable Housing Agreement; and

WHEREAS, the Developer is invoking the State Density Bonus Law to receive three concessions for the Planned Development Permit ( PD-S-2025-0007) in exchange for 238 units to be reserved for very low -income and low-income households; and

WHEREAS, the Developer is invoking the “By Right” development procedures stated in Assembly Bill No. 1397, which would require the City to use a by- right process of approval for a development in which at least 20% of the units are affordable to lower-income households during the planning period; and

WHEREAS, the City Council finds and determines that the City has duly considered all terms and conditions of the proposed Affordable Housing Agreement, and believes that the development of the Project on the Site pursuant thereto is in the best interests of the City of Simi Valley and the health, safety and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SIMI VALLEY DOES HEREBY RESOLVE AS FOLLOWS:

6 SECTION 1. That the above recitals are true and correct and have served, together with the Affordable Housing Agreement (AHA -2025-0002) attached hereto as Attachment B , and as described in the June 8, 2026, City Council staff report, and incorporated herein by reference, as the basis for the approvals set below.

SECTION 2. The City Council hereby finds and determines that the two - hundred thirty-eight (238) affordable housing units to be provided by the Affordable Housing Agreement will remain available at affordable housing cost to very low -income and low-income households for a period of fifty-five (55) years.

SECTION 3. The City Council hereby approves the Affordable Hous ing Agreement for AHA -2025-0002 ( Attachment B ), between the City of Simi Valley and Affordable Housing Land Consultants, LLC, a California limited liability company (Tapo Street Apartments).

SECTION 4. The City Council and the officers of the City are hereby authorized and directed, jointly and severally, to do any and all things, to execute and deliver any and all documents which they may deem necessary or advisable in order to consummate the Affordable Housing Agreement (AHA -2025-0002) (Attachment B ) and to administer the transaction following their execution, and otherwise to effectuate the purposes of this Resolution, and such actions previously taken by such officers are hereby ratified and confirmed.

SECTION 5. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the Office of the City Clerk.

PASSED and ADOPTED this 8th day of June 2026.

Attest:

Lucy Blanco, City Clerk Dee Dee Cavanaugh, Mayor of the City of Simi Valley, California

Approved as to Form: Approved as to Content:

Algeria R. Ford, City Attorney Samantha C. Argabrite, City Manager

Stratis Perros
Environmental Services Director
7 Res. No. 2026-17
Attachment B

SPACE ABOVE FOR RECORDER‘S USE
ONLY

The Undersigned d eclares that this
document is recorded for the b enefit of
the City of Simi Valley and therefore is
exempt from the payment of a recording
fee pursuant to Government Code
Section 6103 & 27383.

APN: 618-0-160-145

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT

TAPO STREET APARTMENTS
(Affordable Housing Land Consultants LLC)

The land referred to in this Affordable Housing Agreement (AHA-2025-0002) is situated in the
City of S imi Valley, County of Ventura, State of California on a 2.63-acre portion of a parcel generally located at 2267 Tapo Street, more particularly described in attached Exhibit “A,” which is incorporated by reference.

These Restrictions provide rights to the City of Simi Valley in regulating the rental of the subject 240-unit apartment project, containing 238 affordable units, for a period of 55 years from the date of a final Certificate of Occupancy.

CITY OF SIMI VALLEY
Attn: City Clerk
2929 Tapo Canyon Road
Simi Valley, CA 93063
8 AFFORDABLE HOUSING AGREEMENT

TAPO STREET APARTMENTS

AFFORDABLE HOUSING LAND CONSULTANTS LLC
THIS AFFORDABLE HOUSING AGREEMENT ( AHA-2025-0002) (“Agreement”) is entered into this 8th day of June 2026, between the City of Simi Valley, a general law city and municipal corporation ( “City”) and Affordable Housing Land Consultants, LLC, a California limited liability company (“Owner”). The City and Owner are collectively referred to as the “Parties.” The Parties agree as follows:

1. RECITALS.

This Agreement is made with reference to the following facts and circumstances:

A. The Project Site consists of an approximately 2.63-acre portion of a property located in the City of Simi Valley, County of Ventura, State of California, as more particularly described in Exhibit “A ,” and incorporated by reference (“Project Site”).

B. Owner through an application submitted by Amanda Locke with AMG & Associates, LLC received an a pproval for PD -S-2025-0007; on ( “Project Approvals” ) to develop a 240-unit apartment project containing 238 affordable units ( “Project”) on the Project Site and two (2) unrestricted manager’s units, under Resolution No. .

C. City, and Owner entered into this Agreement to govern the 238 affordable set-aside units in the Project.

D. Pursuant to Government Code Section 65915 (the “Density Bonus Law”), the City granted the Owner density bonuses, concessions, and waivers for the development of the Project. In consideration for these benefits, the Owner agreed to restrict the occupancy of 238 dwelling units, consisting of:
(i) 73 units affordable to Very Low -Income Households, with rents not exceeding 30% of 50% of the area median income, adjusted for household size appropriate to the unit; and (ii) 165 units affordable to Low -Income Households, with rents not exceeding 30% of 80% of the area median income, adjusted for household size appropriate to the unit.

2. DEFINITIONS.

Unless the contrary is stated or clearly appears from the context, the following definitions will govern the construction of the words and phrases used in this Agreement:

2.01 “AHU” or “Affordable Housing Unit” means each of the two hundred thirty- eight units within the Project, unit size (to be determined) adjusted according to family size, which are reserved for rental to Qualified Tenants in accordance with the terms of this Agreement.
9 2.02 “ Affordable Rent ” means: for a Very Low -Income Household, a monthly rent that does not exceed 1/12th of 30% of fifty percent of the Area Median Income for a household size appropriate to the Unit; OR for a Lower-Income Household, a monthly rent that does not exceed 1/12th of 30% of eighty percent of the Area Median Income for a household size appropriate to the Unit. The maximum monthly rental amount of the Units must be adjusted annually by the formula set forth above upon the promulgation of revised Area Median Income figures; provided, however, for so long as the Project Site is encumbered by a tax credit regulatory agreement with the California Tax Credit Allocation Committee (“CTCAC”), Affordable Rent for each AHU shall be established strictly in accordance with the rent schedules published by CTCAC. Actual rent charged may be less than such maximum rent.

2.03 “Area Median Income” or “AMI” means the annual median income, adjusted according to household size, for the County of Ventura, as most recently published and updated by the United States Department of Housing and Urban Development (“HUD”) and as set forth in 25 California Code of Regulations Section 6952, or any other comparable source City deems appropriate.

2.04 “Director” means the Environmental Services Director of the City of Simi Valley.

2.05 “Gross Income” means all payments from all sources received by a person (together with the gross income of all persons of the age of 18 years or older who intend to reside with such person in one residential unit) , whether in cash or in kind as calculated pursuant to HUD Regulations in effect as of the Date of this Agreement.

2.06 “HUD” means the U.S. Department of Housing and Urban Development or any successor agency.

2.07 “Income Limit Schedule” means the Schedule of Income Limits for the County of Ventura most recently published and updated by HUD and as set forth in 25 California Code of Regulations Section 6952, including the Lower-Income and Moderate-Income Limits for Ventura County, adjusted by household size.

2.08 “Initial Rent” means the amount charged to a Qualified Tenant for first occupancy of an AHU immediately after the Certificate of Occupancy or equivalent is issued for the Project.

2.09 “Initial Rent Date” means the first occupancy date of an AHU by a Qualified Tenant immediately following the issuance of a Certificate of Occupancy or equivalent for the Project.

2.10 “Initial Tenant Costs” means all deposits and fees, exclusive of the first month’s rent, charged to a Qualified Tenant before occupying an AHU. 10 2.11 “ Lower-Income Household” means persons and families whose incomes do not exceed the qualifying limits for lower -income families, in accordance with Health and Safety Code Section 50079.5.

2.12 “Manager” means that person (or persons) who resides within the Project and has been hired by Owner to provide on-site management duties.

2.13 “Qualified Tenant” means a renter household or rental applicant household who meets the income criteria herein for eligibility as a Very Low-Income or Lower-Income Household at the time of the initial tenancy (i.e., the date of initial occupancy as evidenced by execution by the tenant household of the initial Lease or Rental Agreement with the Owner).

2.14 “Restricted Rental Rate” means a rental payment regulated by the terms of this Agreement.

2.15 “Very Low-Income Household” means persons and families whose incomes do not exceed the qualifying limits for very low -income families, in accordance with Health and Safety Code Section 50105.

3. DESIGNATION OF AFFORDABLE HOUSING UNITS; REGULATORY

INCENTIVES

3.01 Designation of AHUs. In exchange for density bonus, threewo concessions and fiveour waivers under the Density Bonus Law, Owner agrees that at all times during the term of this Agreement, the AHUs be occupied exclusively by Qualified Tenants at the restricted rents identified in Paragraphs 6 .01 and 6.03 (the “AHUs”).

3.02 Incentives and Waivers. Owner acknowledges receipt of density bonus, and threewo concessions and five waivers under the Density Bonus Law in exchange for Owner ’s agreement to restrict the rents of the AHUs. In conformance with §65915(f)(b)(1)(G), a project is permitted an 80% density bonus when 100% of a project’s units are designated to low ‐income households, with the exception of manager’s units, except that up to 20% can be set aside for moderate-income households. City also granted the following concessions (“Concession”) pursuant to Government Code Section 65915(d)(1) and the Simi Valley Municipal Code (“SVMC”):

City also granted the following waivers (“Waivers”) pursuant to Government Code § 65915(e)(1), (k)(1), and the SVMC:

Waivers (Unlimited)

1. Maximum Height (Stories) [ESVSP Table 3.4]: This standard requires a maximum height of 4 stories. The project proposes a maximum of 6 stories with tiered heights along Tapo and Winifred Streets. Applying this standard to the project would require reducing the project’s height by 2 stories and remove 84 units. If a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development 11 standard must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. a 240‐ unit project .

This request also qualifies as a concession because it results in actual and identifiable costs by increasing the total cost per unit in land price per unit soft costs.

2. Maximum Height (Feet) [ESVSP Table 3.4]: This standard requires a maximum height of 55 feet. The project proposes a maximum height of 76 feet to parapet with tiered heights along Tapo and Winifred Streets. Applying this standard to the project would require reducing the project’s height by 2 stories and removing 84 units. If a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development standard must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. , a 240 ‐unit project.

This request also qualifies as a concession because it results in actual and identifiable costs by increasing the total cost per unit in land price per unit soft costs.

3. Parking [ESVSP Section 3.3.N.6]: This standard requires that projects within the ESVSP and are subject to the following parking ratios: one space for one‐ bedroom units, one and one‐ half spaces for two bedroom units, two spaces for units with three or more bedrooms, and one space for every five units for guests. A project of our proposed unit count would require a total of 386 parking stalls as calculated in the table below. The proposed project provides 172 parking spaces in total in the ground level parking structure and rear surface parking lot. To comply with this standard would mean reducing the unit count by 131 units to match the parking ratio requirements. If a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development standard must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e., a 240‐unit project. This request also qualifies as a concession because it results in actual and identifiable costs by increasing the total cost per unit in land price per unit soft costs.

Applying this standard to the Tapo frontage of the project would require removing 14 units. In the event that a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development standard must be 12 waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. , a 240‐unit project. This request could also qualify as a concession because it would result in actual and identifiable costs and would increase the total cost per unit in land price and cause an increase in per unit soft costs.

5. Storage Areas [Simi Municipal Code Section 9-24.060.B.2.b] : This standard requires that each unit within multi -family residential projects be provided with a storage area “attached to the unit, garage, or attached carport.” If a small storage room were provided for each unit on every floor, then we estimate losing two uni ts per floor or 10 units in total. In the event that a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. This development standard is hereby waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e., 240-unit project.

Concessions

1. Residential Private Open Space [ESVSP Section 3.3.H.1.b]: This standard requires that a minimum of 70 square feet of private open space be provided for each unit as either a balcony or patio. The project does not propose any private open space. The majorit y of these units would require balconies which results in high construction costs including, but not limited to, structural support, waterproofing, railings, and special annual inspections. We estimate approximately 207 of the units will require a balcony and 33 units on the second floor facing the outdoor podium courtyards will require a private patio.

We estimate that this will cost approximately $15,000 to $30,000 per unit. If we incorporated private open space for all units then we expect an increase in the construction budget of approximately $3,600,000 to $7,200,000. The request for relief from residential private open space comports with density bonus law because it is clear that the cost savings is necessary to be able to provide affordable rents for the targeted units within the Project and as such, this demonstrates an actual, identifiable cost reduction within meaning of Section 65915(d).

2. Minimum Percent of Commercial Use [ESVSP Section 3.10, Table

3.4]: This standard requires that a minimum of 10% of a project be dedicated for commercial uses. The project proposes 2,000 square feet, less than 1% of the total building area. If the project met this requirement then the 30,160 square feet total would need to be provided to meet the 10% requirement. Therefore, an additional 28,160 square feet would be needed. To accommodate the
additional commercial square footage, our proposed residential parking, and the necessary parking for commercial uses, a subterranean level of parking would need to be designed. Based on 13 other similarly designed and constructed projects, a subterranean parking garage can cost $100‐$110 per square foot. Consequently, assuming a subterranean parking garage level of about 30,000 square feet to accommodate some parking stalls relocated from the ground floor, this modification alone could increase construction costs by approximately $3,000,000 to $3,300,000, or an additional cost of $12,500 to $13,750 per unit. A concession from this standard is necessary to provide the units at the targeted density and affordability levels, resulting in an identifiable and actual cost reduction.

3. Articulation of Building Facades [ESVSP Section 3.4.A.1.a]: This standard requires that “for each 75 feet of building length, recess 20 percent of the front facade by a minimum of four feet deep, in addition to the articulation listed in Table 3.3, to avoid long, flat walls, or buildings, façades.” As currently designed, the Tapo frontage is 120’ with 4% of the façade recessed at the second level and above. To increase this recess to meet the 20 percent requirement, the recess between units would need to increase by an additional 22 feet, requiring the units to cantilever over the corner of the commercial space. This would result in an increase to the exterior façade perimeter, thus increasing the amount of materials and structural support necessary to achieve this standard. We estimate an increase to the overall construction cost by about $50,000 to $100,000. A concession from this standard is necessary to provide the units at the targeted density and affordability levels, resulting in an identifiable and actual cost reduction.

4. TERM

4.01 Term of Agreement . Pursuant to the Density Bonus Law, the term of this Agreement begins on the date the Building Official issues a final Certificate of Occupancy, or equivalent , for the P roject and remains in full force and effect for a period of 55 years afterward.

4.02 Restricted Rental Period. City and Owner agree that the Restricted Rental Period commences on the Initial Rent Date for the first unit rented under this Agreement and terminates 55 years after the Building Official issues a final Certificate of Occupancy or equivalent for the Project.

5. TIME CONSTRAINTS

5.01 Maintenance of Entitlements. Owner must maintain compliance with PD-S- 2025-0007 including extensions and/or modifications. Any violation of PD - S-2025-0007 may result in the City declaring this Agreement null and void.

5.02 Inspection of AHUs . The AHUs must receive final inspection approval no later than the date that the market -rate units receive final inspection and approval. Time is of the essence in the occupancy of the AHUs.

5.03 Rent Up. The Owner agrees to rent at least five AHUs to Qualified Tenants within six months thereafter receiving a Certificate of Occupancy for any of the units in the Project.
14 6. RENTS

6.01 Initial Rents. The initial gross rent for each AHU in the Project (the “Initial Rents”) must conform with the allowable “Affordable Rent” for Very Low - Income or Lower -Income Households, as defined in Health and Safety Code Section 50053. F or Very Low -Income Households, the Initial Rent must be the product of 30% times fifty percent of the Area Median Income for Ventura County adjusted for household size appropriate for the unit, and for Lower-Income Households, the Initial Rent must be the product of 30% times eighty percent of the Area Median Income for Ventura County adjusted for household size appropriate for the unit, or if the household is a Section 8 voucher holder, the f air market rent as qualified by Section 8 program with the tenant portion of the rent not exceeding 30% of the household income; provided, however, for so long as the Project Site is encumbered by a CTCAC tax credit regulatory agreement, Initial Rents for each AHU shall be established strictly in accordance with the rent schedules published by CTCAC. Initial Rent must be adjusted by the utility allowance established by the Area Housing Authority of the County of Ventura, except as provided in Paragraph 6.03 of this Agreement.

6.02 Security Deposits. Total deposits including security deposits and any other initial costs required of the Qualified Tenant occupying an AHU, other than the first month’s rent, cannot exceed the tenant portion of one month’s gross rent (without deduction of utility allowance) as determined under Paragraphs 6.01 or 6.03. If the security deposit exceeds $500, upon request of the Qualified Tenant, s/he is allowed to pay the deposit in three equal monthly installments which is due, together with the monthly rent upon execution of the rental agreement, and on the rent due date of the following two months of occupancy of the AHU. Monthly installments are credited to tenant’s security account. The security deposit cannot be increased as long as the tenant resides in the same unit.

6.03 Rent Adjustments.
(a) “Adjustment Date” means 90 days after HCD issues updated AMI limits or CTCAC issues updated rent limits , but in any event, not more frequently than annually as long as this Agreement remains in effect.
(b) On each Adjustment Date, the annual rent increase for each of the AHUs is limited to not more than the lesser of the following:
i. 5% + Consumer Price Index (“CPI”); or
ii. The percentage increase in the Median Income Limit for Ventura County.
(c) Notwithstanding subparagraph (b), in no event may the tenant portion of the rent for any Very-Low-Income Affordable Housing Unit exceed thirty 30% of fifty percent of the Area Median Income amount, adjusted for household size as established by the California 15 Department of Housing and Community Development, whichever is lower; and in no event may the tenant portion of the rent for any Lower-Income Affordable Housing Unit exceed thirty 30% of eighty percent of the Area Median Income amount, adjusted for household size as established by the California Department of Housing and Community Development, whichever is lower.

7. METHOD OF RENTAL

7.01 Classification. Any unit occupied by a Qualified Tenant as determined per Paragraph 8.01 is considered to have satisfied the occupancy requirements set forth above; therefore, must be subject to the Affordable Rent restrictions provided in this Agreement and must continue to satisfy such requirements if the tenant is recertified as a Qualified Tenant in accordance with Paragraph 8.02.

8. DETERMINATION OF TENANT ELIGIBILITY

8.01 Qualification. Owner is responsible for determining, in accordance with the provisions of 25 California Code of Regulations Section 6910, et seq., as those sections may be amended, the income eligibility of a potential AHU renter household. On the date an AHU is leased, the gross annual income of a Qualified Tenant occupying said unit can not exceed the limit for Very Low-Income or Lower-Income Household for Ventura County, as adjusted for the tenant’s household size. Gross income calculations for prospective (and continuing) tenants are determined in accordance with 25 Cal. Code of Regulations Section 6914. Owner must determine income qualification of an applicant tenant household by obtaining and reviewing required income records from each member of such tenant household. Such records should include, without limitation, the most recent federal income tax return of each member of said tenant household, bank records, Social Security Administration statements, pay stubs or other documentation, which verified the household’s annual income (the “Supporting Documentation”).

Additionally, Owner must obtain written certification of the anticipated income of all non-minor members of the tenant household for the 12-month period following the date of determination of income. Also, Owner must complete and provide to the City an Affordable Housing Program Tenant Certification, Exhibit “B,” before use and City reasonably approves such use. Each AHU rented to a Qualified Tenant must be occupied by that household. Further, any AHU cannot be occupied by the Manager, and the Manager’s unit cannot be designated as an AHU.

8.02 Tenant Recertification. Tenant Recertification means the Owner’s annual verification of a Qualified Tenant’s income conducted in accordance with Paragraph 8.01. At least 60 days before each Adjustment Date, Owner must provide written notice to AHU occupants to complete an Affordable Housing Program Tenant Recertification, Exhibit “C ,” and to provide supporting income verification documentation to the Owner before the Adjustment Date. In the event that the tenant fails to provide proof of income to Owner on or before the Adjustment Date, such tenant is deemed to have committed 16 a material breach of the Lease Agreement and the Lease Agreement must provide that such breach is cause for termination of tenancy. Owner cannot renew the tenant’s lease without such proof of income. Subject to the limitations of State and Federal law, no tenant residing in an AHU can be denied continued occupancy, solely because their household income has increased such that it exceeds the limits for Lower-Income or Moderate- Income Households for Ventura County, adjusted for household size pursuant to Paragraph 2.07. Owner must keep copies of all AHU Tenant Recertification forms on file and make them available to City upon request.

8.03 Change In Household Composition/Income. Owner is responsible for, in accordance with the provisions of the HUD Multifamily Occupancy Handbook 4350.3 Chapter 7, annual recertification, interim recertification (change in household composition), unit transfers, and gross rent changes.

9. OUTREACH PROGRAM

9.01 Outreach and Affordable/Affirmative Marketing Program . Owner must submit for approval a detailed Outreach and Affordable/Affirmative Marketing Program (the “ Marketing Program”), which include s, without limitation, advertising, publicity and promotion, to the Director not less than 120 days before the projected completion of the Project. Owner may not commence marketing efforts of the AHUs as part of its overall Marketing Program for the Project, before the Director approves the Marketing Program, which approval should not be unreasonably withheld or delayed.

The purpose of the Marketing Program is to s olicit and obtain Qualified Tenants for occupancy of all AHUs, to establish a waiting list for units that may become available and to affirmatively further fair housing goals by designing a program that attracts prospective Qualifying Tenants of all majority and minority groups in the housing market area regardless of race, creed, color, religion, sex, national origin, marital status, status with regard to receipt of public assistance, or disability. The Marketing Program should ensure that any persons normally not likely to apply for the AHUs without special outreach efforts know about the availability of the AHUs, feel welcome to apply and have the opportunity to rent an AHU. The marketing program must begin before the occupancy of any apartment units within the Project and must include the following:
(a) A print media schedule as shown on attached Exhibit “D,” which is incorporated by reference, to be published in a newspaper of City - wide or regional circulation;
(b) Noticing and listing the Project throughout the life of this Agreement with the Area Housing Authority of Ventura County, the Simi Valley Senior Center , City Hall, Simi Valley Public Library, and, as appropriate for market conditions, the Conejo Simi Moorpark Association of Realtors, Simi Valley faith community, and such other similar agencies as the Director may designate;
17 (c) Notifying all persons on the Owner’s waiting list for affordable rental housing;
(d) Establishing of a telephone number for the Project with message capabilities to receive inquiries on vacant units, including the AHUs throughout the life of this Agreement;
(e) Continuous display of the fair housing logo in the rental office and in advertising; and
(f) Budgeting to adequately fund the reasonably necessary expenses of the foregoing.

The Parties agree that, with the exception of subparagraphs 9.01 (c) (d), and (e) above, the other items listed above must be implemented only when vacant units are or will soon be available for rental and when there is no one on the Owner’s waiting list for the AHUs.

9.02 Waiting List.
(a) From the commencement of the Outreach and Marketing Program and through the Restricted Rental Period, Owner must establish and maintain a waiting list regarding the applicants for the AHUs and select the prospective Qualifying Tenants on a first -come, first- served basis. The waiting list must include the information requested in Exhibit “E.” In no event may the waiting list be closed during the Restricted Rental Period by Owner.
(b) Owner will not be obliged to rent an AHU to a potential renter on a waiting list unless such potential renter agrees to and does enter into a Lease Agreement which provides that the potential renter agrees to occupy the AHU no later than : (a) forty -five days after Owner notifies such potential renter that the AHU is available for occupancy, or (b) thirty days after such AHU is vacated by the prior tenant, whichever is later.

9.03 Initial Marketing Plan. The Marketing Program must be no less intensive in the City of Simi Valley as compared to any other region.

9.04 Awareness of the AHU Availability . Owner must design the Marketing Program to include provisions that create and build audience awareness of the availability of AHUs and equal housing opportunities.

9.05 Failure to Implement an Outreach Program . If Owner fails to submit for approval and implement the Marketing Program, City has the right to implement a marketing program, at Owner expense, for the purpose of soliciting Qualified Tenants for Owner’s AHUs.

9.06 Prioritization and Selection of Potential Tenants. Owner agrees to begin advertising the AHUs at least four months before the projected date of 18 completion of construction of the AHUs, and to begin accepting applications for the AHUs at the same time.

10. NOTICES, DISCLOSURES, AND RECORDS

10.01 Notices. During the Restricted Rental Period, Owner must provide the following notices to tenants at the inception of each AHU tenancy:
(a) Housing Information. Owner must provide tenants and prospective tenants with information on fair housing regulations and the State and Federal agencies responsible for enforcing them.
(b) Adjustment Date. Owner must inform each tenant, in writing at the time of occupancy of an AHU, the next Adjustment Date for that unit if known at that time.

Owner is responsible for obtaining proof that these items were received by the tenants and must keep such proof in the tenant files for inspection by City, if requested. This may be accomplished by having the tenants initial the lease that they have received the above information.

10.02 Expiration. Owner must comply with the requirements of Government Code Section 65863.10 and any other then-applicable federal, state or local laws related to the expiration of the affordability period.

10.03 Right of First Refusal/Preservation Notices. During the term of this Agreement, Owner must be in compliance with Government Code Section 65863.11 and any other then-applicable sections of California law.

10.04 Subleasing Restricted. As part of every rental agreement, Owner must provide a clause which, by its terms, prohibit s to the fullest extent allowed by law, the subject AHU tenant from assigning, subleasing or transferring any interest in the unit to another without obtaining the City’s prior written approval. No such approval will be granted for any sublease which provides for rent or tenant income in excess of that authorized herein. This provision does not prohibit Owner and the AHU tenant from entering into a new rental agreement to add additional household members provided that the new tenant household is determined to be eligible in accordance with Paragraph

8.01. 10.05 City Notification. Owner must make available to City , copies of all notices and housing information delivered under Paragraphs 10.01 through 10.04 within three business days of demand by City. All notices required by Paragraphs 10.01 through 10.04 must be set forth in bold- faced or capitalized letter, in a type face of at least 12 points, and must be separately initialed by the tenants.

10.06 Notice of Non-Compliance. Upon City determination of a material breach by Owner of the terms of this Agreement, City must within ten (10) working days after becoming aware of such material breach, provide written notice of the same to Owner, describing the nature of said breach, and Owner 19 must have a reasonable period of time to cure such material breach before Owner is declared as being in default hereunder.

10.07 Records. Owner must maintain complete, accurate, and current records pertaining to the Project, and must permit any duly authorized representative of the City to inspect records, including records pertaining to income, age, and household size of r esidents, with 48 hours’ notice. All Resident lists, applications, and waiting lists relating to the Project must at all times be kept separate and identifiable from any other business of the Owner and must be maintained as required by the City, using record
-k
eeping forms provided by the City (Exhibits “B” through “F”), or on forms acceptable to the City, in a reasonable condition for proper audit and subject to examination during business hours by representatives of the City. The Owner must retain copies of all materials obtained or produced with respect to occupancy of the AHUs from application to move-out and for a period of 5 years thereof.
11 CO

NDITION AND MAINTENANCE OF UNITS/PROJECT

11.01 Project Architecture. All units in the Project must have the same architectural, exterior, and interior treatments, with the exception of the units to be occupied by the Managers.

11.02 Project Maintenance. Owner must ensure that sufficient revenues are reserved and expended for maintenance of the Project as required by all applicable laws, and so as to maintain all areas of the Project in a well-kept condition, order and repair , safe, attractive and continuously functional in accordance with all state and local codes and regulations. Owner further agrees that such maintenance must be performed in a workmanlike manner on a regular basis and/or as needed and at times which will minimize inconvenience to tenants.

12 REPORTING AND AUDIT REQUIREMENTS

12.01 Status Reports. Beginning on the first anniversary of the Initial Rent Date for the first AHU rented in the Project, and continuing on each such annual anniversary thereafter during the Restricted Rental Period, Owner must submit the following written reports to the Director:
(a) a copy of the waiting list (Exhibit “E”);
(b) a Unit Summary Report of all Affordable Housing Units (Exhibit “F”).

12.02 Audit. Owner must permit the City, with reasonable notice and during normal business hours, to inspect the Project Site to verify Owner’s compliance with this Agreement. Owner must make available to the City, during normal business hours such records as the City may reasonably request to verify such compliance. Should Owner fail to submit timely reports as required by Paragraph 12.01 above, City may cause an audit to be conducted at the sole expense of Owner, in addition to any other 20 available legal remedies. Owner must cooperate with any such audit and further agrees to make available to the City all documents relative to rental of the AHUs to verify compliance with the terms of this Agreement. 13 ENFORCEMENT PROVISION

13.01 Enforcement. City has the authority to enforce all the provisions of this Agreement, including the Covenants and conditions contained herein. City may take any enforcement action permitted by law, including but not limited to, a civil action for specific performance of the restrictions and terms of this Agreement, damages for breach of contract, restitution and injunctive relief.

The remedies provided herein are cumulative and not exclusive and does not preclude City from seeking any other remedy to which it otherwise would be entitled under law or equity.
14 SUCCESSORS AND ASSIGNS

14.01 Successors and Assigns. The parties hereto each agree that the obligations and duties contained herein are binding upon the City and Owner, and their respective successors and assigns. Owner and its successors cannot assign its rights or delegate its duties or obligations, or sell, transfer, convey, encumber, assign or lease any of the AHUs (other than for individual tenant use as contemplated hereunder). City and its successors and assigns are deemed the beneficiary of the covenants contained herein, witho ut regard to technical classification and designation. The covenants run in favor of City, its successors and assigns without regard to whether City has been, remains, or is an owner of any land or interest thereon. Owner must provide at least fifteen (15) day notice to City before any proposed transfer to a successor or assign. T he assignee or successor must agree in writing to assume on behalf of itself and its successors and assigns, all the duties and obligations of the Owner under this Agreement, and any purported assignment will not be valid without such a written agreement.

14.02 Rights of Mortgage Holders. The provisions of this Agreement do not limit the right of the holder of any mortgage, deed of trust or other lien or encumbrance (collectively “Mortgage Holders”) to exercise any of its remedies for the enforcement of any pledge or lien upon the Propert y, provided however, that the obligations under this Agreement survive the exercise of such right through the remainder of the term of this Agreement pursuant to Paragraph 4.01.
15 RECORDATION OF AGREEMENT

15.01 Recording Agreement. This Agreement must be recorded before issuance of building permits. Owner must also record, separate from this Agreement the Declaration of Conditions and Restrictions on the Transfer of Title or Interest in Real Property document in the form of Exhibit “G,” stating that the conditions and obligations to which the subject Project is bound to run with the land.
21 16 GENERAL PROVISIONS

16.01 Indemnity and Hold Harmless . Owner must defend and provide legal defense with attorney(s) acceptable to the City, indemnify, and hold harmless the City, their agents, officials, officers, representatives and employees, from and against all claims, lawsuits, liabilities or damages of whatever nature arising out of or in connection with, or relating in any manner to any act or omission of Owner, its agents, employees, and subcontractors, and employees thereof, pursuant to the performance or non-performance of this Agreement, unless due to the gross negligence or willful misconduct of the City . Owner must thoroughly investigate any and all claim s and indemnify the City and do whatever is commercially necessary to protect the City, its agents, officials, officers, representatives and employees as to any such claims, lawsuits, liabilities, expenses, or damages arising out of this Agreement. Further, Owner cannot bring any claims, cross- claims, actions or cross- complaints against the City, its agents, employees or representatives, arising out of any disputes between Owner and third parties as to the City approvals or the issuance of building permits for this Project.

16.02 Time is of the Essence. The Parties hereto agree that time is of the essence in the performance of this Agreement. No waiver by any of the Parties to this Agreement or the non-performance or any breach of any term, provision or condition of this Agreement or any default hereunder is considered to be or operate as a waiver of any subsequent non- performance, breach or default.

16.03 Extension of Time Good Cause. The City may, in its sole discretion, extend one or more time deadlines for performance as referenced in this Agreement for good cause. “Good cause” includes, but is not limited to, acts of God, labor strikes, war, riots, pandemics, etc., as determined the City in its sole discretion.

16.04 Modifications. The Parties hereto each agree that no addition to or modification or waiver of any term or provision of this Agreement is effective unless set forth in writing, in the same manner and form as originally adopted and signed by both the City and Owner except that the City reserves the right to make minor amendments to this Agreement, which may become necessary due to changes in governmental regulations or other requirements affecting the parties involved in the arrangement of project financing so long as such amendments do not materially or substantially modify the terms contained in this Agreement and do not add to the costs incurred by the City. The parties hereto further agree that oral agreements or understandings are of no force or effect whatsoever.

16.05 Not for the Benefit of Third Parties. This Agreement does not create any enforceable right, cause of action, or claim in any third party. The Owner, the City or their successors in interest are the sole parties who have standing to enforce the terms or obligations or to bring suit for damages arising out of a breach of this Agreement.
22 16.06 Not a Partnership or Joint Venture. This Agreement does not create a partnership or joint venture.

16.07 Subordination. Owner acknowledges that the City must not subordinate this Agreement or any of its terms or the separately recorded declaration of conditions and restrictions to any lien, encumbr ance or mortgage for the Project. In the event that this Section 17.07 Agreement conflicts with any contract, agreement or order to which Developer or any parties affiliated with Developer is a party or by which it is bound, this Section 17.07 will prevail.

16.08 Non-Discrimination. All of the Units must be available for occupancy on a continuous basis to members of the general public. Owner can not give preference to any particular class or group of persons in renting the Units, except to the extent that seventy-three units are required to be leased to Very L ow-Income Household s, and one hundred sixty -five six units are required to be leased to Lower-Income Households.

Owner covenants by and for itself and any successors in interest that there will be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use occupancy tenure or enjoyment of the Project nor can Owner itself, or any person claiming under or through it establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Project. The foregoing covenants run with the land.

Owner must accept as tenants on the same basis as all other prospective tenants, persons who are recipients of federal certificates for rent subsidies pursuant to the existing program under Section 8 of the United States Housing Act of 1937, or its successor. Owner must not apply selection criteria to Section 8 certificate holders that are more burdensome than criteria applied to any other prospective tenants.

All leases or contracts made relative to the Project, the improvements thereon or any part thereof, must contain or be subject to substantially the following nondiscrimination clause:
“There must be no discrimination against or segregation of any person or group of persons on account of race, color, creed religion, sex, sexual orientation, source of income, marital status, physical or mental handicap, medical condition, national origin or ancestry in the sale, lease, sublease transfer, use occupancy, tenure or enjoyment of the Project nor may lessee [or the contractor] or any person claiming under or through it, establish or permit any such practice or 23 practices of discrimination or segregation with reference to the election location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Project.”

16.09 Violation of Conditions of Approval. Any violation of the conditions of any of the Project Approvals will also constitute a violation of this Agreement and are enforceable as a breach hereof, as well as any other remedies.

16.10 Default. If Owner defaults in the performance or observation of any covenant, agreement or obligation set forth in this Agreement, and if such default remains uncured for a period of sixty (60) days after written notice must have been given by the City to Owner, then the City may declare an “Event of Default” to have occurred hereunder, and, at its option, may take any one or more of the following steps:
(a) By mandamus or other suit, action or proceeding at law or in equity, require the Owner to perform its obligations and covenants hereunder or enjoin any acts or things which may be unlawful or in violation of the rights of the City hereunder;
(b) Have access to and inspect, examine and make copies of all of the books and records of the Owner pertaining to the 238 AHUs; (c) Take such other action at law or in equity a may appear necessary or desirable to enforce the obligations, covenants and agreements of the Owner.

16.11 Severability. The Parties hereto each agree that should any portion of this Agreement be held invalid or unenforceable for any reason, such determination does not affect the validity of the remaining portions of this Agreement.

16.12 Covenants to Run with the Land. Owner subjects the Project (including the Project Site) to the covenants, reservations and restrictions set forth in this Agreement. The City and Owner declare their express intent that the covenants, reservations and restrictions set forth herein are deemed covenants running with the land and must pass to and be binding upon Owner’s successors in title to the Project; provided, however, that on the termination of this Agreement, said covenants, reservations and restrictions must expire. Each and every contract, deed or other instrument hereafter executed covering or conveying the Project or any portion thereof must conclusively be held to have been executed delivered and accepted subject to such covenants, reservations and restrictions regardless of whether such covenants, reservations and restrictions are set forth in such contract deed or other instrument. Owner, by and for itself and each successor to any interest in the Project, hereby specifically acknowledges and agrees to be bound by the covenants contained herein.

16.13 Notices. The parties hereto each agree that all notices or other communications required or permitted hereunder must be in writing, must be either personally delivered or sent by United States certified mail or 24 registered mail, return receipt requested, and must be deemed received seventy-two (72) hours after deposited in the mail in the Counties of Ventura, Orange or Los Angeles, postage pre- paid, addressed to the persons to receive such notice, at the following address:

To City: City of Simi Valley
Attn: Environmental Services Director
2929 Tapo Canyon Road
Simi Valley, CA 93063

To Project Owner: Affordable Housing Land Consultants, LLC, a California limited liability company
Attn: Alexis Gevorgian
P.O. Box 260770
Encino, CA 91426

Or to the owner of record or successor in title to the subject Project.

Notice of change of address is required and must be given by written notice in the manner detailed in this Paragraph. Notices required under this Agreement to a Qualified Tenant of an AHU must be deemed adequately given if transmitted in like fashion to the street address and apartment number of such a Qualified Tenant.

16.14 Headings. The Parties hereto each agree that the paragraph headings herein are used only for the purpose of convenience and must not be deemed to modify, explain or limit the subject of the paragraphs of this Agreement to be considered in their construction.

16.15 Incorporation of Recitals and Exhibits. Recitals A through D are incorporated herein by this reference and Exhibits “A” through “G” are attached and incorporated herein by this reference.

16.16 Compliance with Applicable Laws . Owner and City must obey all Federal, State, local and special district laws, ordinances and regulations.

16.17 Entire Agreement . This Agreement, together with its attachments and writings expressly incorporated herein, constitutes the full and total understanding between the Parties hereto, construed according to the laws of the State of California, and supersedes all prior agreements between the Parties hereto.

16.18 Execution In Counterparts. This Agreement may be executed in any number of counterparts, each of which, when executed and delivered to City, is deemed to be an original and all of which, taken together, are deemed to be one and the same instrument.

25 IN WITNESS THEREOF, the Parties hereto have executed this instrument as of the date first above written.

Attest:

Lucy Blanco, City Clerk
City of Simi Valley, a municipal corporation

Dee Dee Cavanaugh, Mayor of the City of
Simi Valley, California
Approved as to Form:

Algeria R. Ford, City Attorney

Affordable Housing Land Consultants,
LLC, a California limited liability company

Alexis Gevorgian, Managing Member

Approved as to Content:

Samantha C. Argabrite, City Manager

Stratis Perros
Environmental Services Director

26 Exhibits List

Exhibit A: Legal Description
Exhibit B: Affordable Housing Program Tenant Certification Exhibit C: Affordable Housing Program Tenant Recertification Exhibit D: Affordable Housing Program Outreach Plan / Print Media Schedule Exhibit E: Affordable Housing Agreement Waiting List
Exhibit F: Affordable Housing Program Unit Summary Report Exhibit G: Declaration of Conditions and Restrictions

27 EXHIBIT "A"

LEGAL DESCRIPTION

REAL PROPERTY IN THE CITY OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:

THE SOUTHERLY 120.00 FEET OF THE NORTHERLY 200.00 FEET MEASUREMENT

ALONG TAPO STREET OF THAT PORTION OF THE NORTHEAST QUARTER OF SECTION 12, TOWNSHIP 2 NORTH, RANGE 18 WEST, RANCHO SIMI, IN THE CITY

OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 5, PAGE 24, OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT WHICH BEARS NORTH 0º 02' 35" EAST 137.50 FEET FROM THE SOUTHEAST CORNER OF TRACT NO. 1224-1, AS SAID TRACT IS SHOWN ON A MAP RECORDED IN BOOK 28, PAGE 23, OF MISCELLANEOUS RECORDS; THENCE FROM SAID POINT OF BEGINNING.

1ST: SOUTH 89º 57' 25" EAST 588.62 FEET TO A POINT ON THE WEST LINE OF TAPO STREET 60.00 FEET WIDE AS SAID STREET IS NOW ESTABLISHED; THENCE

ALONG SAID WEST LINE,

2ND: NORTH 0º 03' 00" EAST 425.10 FEET TO A POINT; THENCE LEAVING SAID

WEST LINE,

3RD: NORTH 89º 57' 25" WEST 588.70 FEET TO A POINT ON THE EASTERLY LINE OF TRACT NO. 1060, AS SAID TRACT IS SHOWN ON A MAP RECORDED IN BOOK 24, PAGE 70, OF MISCELLANEOUS RECORDS; THENCE SOUTHERLY ALONG SAID EASTERLY LINE AND THE EASTERLY LINE OF SAID TRACT NO. 1224-1,

4TH: SOUTH 0º 02' 35" WEST 425.10 FEET TO THE POINT OF BEGINNING.

EXCEPT THEREFROM AN EXISTING WATER WELL SITE 70 FEET BY 70 FEET

SQUARE, LOCATED IN THE NORTHWESTERLY PORTION OF SAID LAND,

TOGETHER WITH THE PUMPING PLANT MACHINERY INCIDENT THERETO, ALSO

TOGETHER WITH APPURTENANT EASEMENTS FOR INGRESS AND EGRESS, WATER PIPELINES AND INCIDENTAL PURPOSES, AS RESERVED BY MORRIS G.

ROSE, ET AL., IN DEED RECORDED AUGUST 16, 1960, IN BOOK 1899, PAGE 161, OFFICIAL RECORDS.

ALSO EXCEPTING THEREFROM AN UNDIVIDED 1/2 INTEREST IN AND TO ALL OIL,

GAS, MINERALS AND OTHER HYDROCARBON SUBSTANCES IN, ON OR UNDER

SAID LAND, BUT WITHOUT THE RIGHT, HOWEVER, OF SURFACE ENTRY AND

WITHOUT THE RIGHT OF ENTRY IN AND TO THE SUBSURFACE THEREOF AT A DEPTH OF LESS THAN 500 FEET BENEATH THE SURFACE, AS EXCEPTED AND RESERVED BY LOU C. WRIGHT, ET AL., IN DEED DATED JANUARY 14, 1957, IN BOOK 1515, PAGE 250, OFFICIAL RECORDS.

ALSO EXCEPTING AN UNDIVIDED 1/2 INTEREST IN AND TO ALL OIL, GAS,

MINERALS AND OTHER HYDROCARBON SUBSTANCES IN, ON OR UNDER SAID LAND AS RESERVED BY MORRIS G. HARRIS, ET AL., IN DEED RECORDED AUGUST 16, 1960, IN BOOK 1899, PAGE 161 OFFICIAL RECORD.

28 SAID LAND IS ALSO KNOWN AS: LOT 2, IN THE CITY OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 2, PAGE 11 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 618-0-160-145

29 EXHIBIT “B”

CITY OF SIMI VALLEY

AFFORDABLE HOUSING PROGRAM TENANT CERTIFICATION

TAPO STREET APARTMENTS, SIMI VALLEY

Manager:

Name: Date:

Address: Phone:

Number of persons in household:

List all persons who reside in unit:

Name

Social Security Number

Age*

*Information on age only required for age restricted projects.

Total Household Income:

1) Previous Year Annual Gross Income (Attach Verification)

Name

Source

Amount

Total Gross Monthly Income:

30 2) Current Monthly Gross Income (Attach Verification)

Name

Source

Amount

Total Gross Monthly Income:

I/We certify that the foregoing is complete, true, and accurate to the best of my/our knowledge and is verifiable by the most recent federal tax return and other income documentation provided herewith. I/We are aware that any misrepresentation in this application will constitute a material breach of my/our agreement with the Owner to rent or lease the unit, and will entitle the Owner to prevent or terminate my/our occupancy of the unit.

Signed: Date:

FOR CITY OFFICE USE ONLY
Anticipated Income
Next 12 Months: Household Size:

Income Level: Lower (80%) Comments: ______________________ Income Level: ______ Moderate (120%)

Approved for Affordable Unit Reviewed by:

Not Approved Date:
31 EXHIBIT “C”

CITY OF SIMI VALLEY

AFFORDABLE HOUSING PROGRAM TENANT RECERTIFICATION

TAPO STREET APARTMENTS, SIMI VALLEY

Manager:

Name: Date:

Address: Phone:

Number of persons in household:

List all persons who reside in unit:

Name

Social Security Number

Age*

*Information on age only required for senior-oriented projects.

Total Household Income:

1) Current Monthly Gross Income (Attach Verification)

Name

Source

Amount

Total Gross Monthly Income:

32 The information on this form is provided solely for the purpose of determining eligibility for the City of Simi Valley Affordable Housing Program. This information is confidential and, except as may be required by the City of Simi Valley or Owner, any use of t his information is strictly prohibited without written consent of the applicant. Acknowledgment of this paragraph does not constitute written permission.

Signed: Date:

Signed:

Date:

FOR CITY OFFICE USE ONLY
Anticipated Income
Next 12 Months: Household Size:

Income Level:

Lower (80%) Comments: ____________________________
_____ Moderate (120%)

Approved for Affordable Unit Reviewed by:

Not Approved Date:

33 EXHIBIT “D”

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT OUTREACH PLAN / PRINT MEDIA SCHEDULE

TAPO STREET APARTMENTS, SIMI VALLEY

PUBLICATION NAME AND CITY

DATES APPEARING

SIZE OF ADVERTISEMENT

FROM

_________________________________________________________________________________________________

OFFICE USE ONLY

ATTACHMENTS: __________ Certification of Publication
__________ Sample Copy of Text

34 EXHIBIT "E"

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT WAITING LIST

TAPO STREET APARTMENTS, SIMI VALLEY

PROJECT: DATE SUBMITTED:

MANAGER:

DATE NAME ADDRESS PHONE
# OF

BEDROOMS
PREFER
HOUSE-

HOLD SIZE
INCOME
LEVEL
(EL/VL)

DATE PLACED IN
UNIT

35 EXHIBIT “F"

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT

UNIT SUMMARY REPORT OF ALL AFFORDABLE HOUSING UNITS

TAPO STREET APARTMENTS, SIMI VALLEY

PROJECT: DATE SUBMITTED:

MANAGER:

UNIT
#

RESIDENT
NAME

DATE
MOVED
INTO
UNIT

MOVE
IN
RENT

RENT
ADJUST.

DATE

RENT
ADJUST.

AMOUNT

CURRENT
RENT

TOTAL
HOUSE-
HOLD
INCOME

# IN
HOUSE-
HOLD

#
BDRMS

INCOME
LEVEL
(EL/VL)

36 EXHIBIT “G”

DECLARATION OF CONDITIONS AND RESTRICTIONS

REQUESTED BY AND
WHEN RECORDED MAIL TO:

CITY OF SIMI VALLEY
Attn: City Clerk
2929 Tapo Canyon Road
Simi Valley, CA 93063

SPACE ABOVE FOR RECORDER'S USE ONLY

The Undersigned declares that this document is
recorded for the benefit of the City of Simi Valley and therefore is exempt from the payment of a recording
fee pursuant to Government Code Section 6103 and
27383.

APNs: 618-0-160-145
______________________________________________________________________

DECLARATION OF CONDITIONS AND RESTRICTIONS

ON THE TRANSFER OF TITLE OR INTEREST IN REAL PROPERTY

TAPO STREET APARTMENTS
(Affordable Housing Land Consultants, LLC, a California limited liability company)

The land referred to is situated in the City of Simi Valley, County of Ventura, State of California, and more particularly described in Exhibit A attached hereto and incorporated herein.

Notice is hereby given that the Project and Project Site described herein is conditioned and the transfer of title and/or interest restricted by the City of Simi Valley ( “City”) as set forth in that document entitled Affor dable Housing Agreement (AHA-2025-0002) (the "Agreement"), recorded in the Official Records of the Office of the County Recorder, County of Ventura, State of California, which is hereby incorporated by reference herein.

Other than in connection with Section 14.03 of the Agreement, said restrictions expressly prohibit the transfer of title, assignment of rights, or delegation of duties without the express written consent of the City. Said consent must be conditioned upon the City's receipt of written evidence from the Buyer/Transferee at least 30 days before said consent that he/she has been fully informed of the terms of the Agreement and the benefits/burdens conferred therein and agrees to assume all of the duties and obligations, as well as the rights and benefits that the existing Owner/Seller enjoys under the terms of the Agreement.

Said restrictions further require the following:
37 1. The Owner/Seller must give at least fifteen (15) days’ notice to City before any proposed transfer to a successor or assign. The assignee or successor must agree in writing to assume on behalf of itself and its successors and assigns, all the duties and obligations of the Owner under this Agreement, and any purported assignment will not be valid without such a written agreement. Said notice must be personally delivered or sent by certified mail, return receipt requested, to:

City of Simi Valley
Attn: Environmental Services Director
2929 Tapo Canyon Road
Simi Valley, CA 93063

2. The title company must immediate notify the City of any attempt to sell or transfer the herein described Project. The Notice must be personally delivered or sent by certified mail, return receipt requested to the address noted above.

3. The escrow company must immediately notify the City of any attempt to sell or transfer the herein described Project. The notice must be personally delivered or sent by certified mail, return receipt requested to the address noted above.

As a condition precedent to the opening of escrow, the Owner, designated agent(s) of the Owners, and the escrow officer each have an affirmative duty to fully disclose the terms of the Agreement to each Buyer. Escrow may open only upon receipt of the Buyer's signed and dated statement acknowledging receipt of a copy of the Agreement.

ANY ATTEMPT TO TRANSFER TITLE OR ANY INTEREST IN THE PROJECT DURING

THE TERM OF THE AGREEMENT IN VIOLATION OF SAID AGREEMENT AND THIS

DECLARATION, MUST CAUSE SAID TRANSFER TO BE VOIDABLE AT THE ELECTION OF THE CITY.

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, THE

RESTRICTIONS AND OBLIGATIONS SET FORTH IN THIS DECLARATION OF

CONDITIONS AND RESTRICTIONS SHALL NOT APPLY TO THE TRANSFERS SET FORTH IN SECTIONS 14.02 and 14.03 OF THE AGREEMENT.

IN WITNESS WHEREOF, the parties have executed this DECLARATION on the day and year first above written. This DECLARATION may be executed in counterparts, each of which must be an original and all of which together constitute one and the same AGREEMENT.

City of Simi Valley Affordable Housing Land Consultants, LLC A Municipal Corporation a California limited liability company, Company its: Managing Member

Samantha C. Argabrite, City Manager By:

Dated: Dated:

38 EXHIBIT "A"

LEGAL DESCRIPTION

REAL PROPERTY IN THE CITY OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:

THE SOUTHERLY 120.00 FEET OF THE NORTHERLY 200.00 FEET MEASUREMENT

ALONG TAPO STREET OF THAT PORTION OF THE NORTHEAST QUARTER OF SECTION 12, TOWNSHIP 2 NORTH, RANGE 18 WEST, RANCHO SIMI, IN THE CITY

OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 5, PAGE 24, OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS:

1ST: SOUTH 89º 57' 25" EAST 588.62 FEET TO A POINT ON THE WEST LINE OF TAPO STREET 60.00 FEET WIDE AS SAID STREET IS NOW ESTABLISHED; THENCE

ALONG SAID WEST LINE,

2ND: NORTH 0º 03' 00" EAST 425.10 FEET TO A POINT; THENCE LEAVING SAID

WEST LINE,

4TH: SOUTH 0º 02' 35" WEST 425.10 FEET TO THE POINT OF BEGINNING.

EXCEPT THEREFROM AN EXISTING WATER WELL SITE 70 FEET BY 70 FEET

SQUARE, LOCATED IN THE NORTHWESTERLY PORTION OF SAID LAND,

TOGETHER WITH THE PUMPING PLANT MACHINERY INCIDENT THERETO, ALSO

TOGETHER WITH APPURTENANT EASEMENTS FOR INGRESS AND EGRESS, WATER PIPELINES AND INCIDENTAL PURPOSES, AS RESERVED BY MORRIS G.

ROSE, ET AL., IN DEED RECORDED AUGUST 16, 1960, IN BOOK 1899, PAGE 161, OFFICIAL RECORDS.

ALSO EXCEPTING THEREFROM AN UNDIVIDED 1/2 INTEREST IN AND TO ALL OIL,

GAS, MINERALS AND OTHER HYDROCARBON SUBSTANCES IN, ON OR UNDER

SAID LAND, BUT WITHOUT THE RIGHT, HOWEVER, OF SURFACE ENTRY AND

ALSO EXCEPTING AN UNDIVIDED 1/2 INTEREST IN AND TO ALL OIL, GAS,

MINERALS AND OTHER HYDROCARBON SUBSTANCES IN, ON OR UNDER SAID 39 LAND AS RESERVED BY MORRIS G. HARRIS, ET AL., IN DEED RECORDED AUGUST 16, 1960, IN BOOK 1899, PAGE 161 OFFICIAL RECORD.

SAID LAND IS ALSO KNOWN AS: LOT 2, IN THE CITY OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, AS PER MAP FILED IN BOOK 2, PAGE 11 OF PARCEL MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 618-0-160-145

40 Attachment C

ASSIGNMENT AND ASSUMPTION

OF AFFORDABLE HOUSING AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION OF AFFORDABLE HOUSING AGREEMENT (this “Assignment”) dated as of June 18, 2026 (the “Effective Date”), is entered into by and between Affordable Housing Land Consultants LLC , a California Limited Liability Company (“Assignor”) and 2267 Tapo St Ground Owner LP, a Delaware limited partnership (“Assignee”) with the consent and agreement of the City of Simi Valley , California, a municipal corporation (“City”) with reference to the following:

RECITALS:

A. Assignor and City entered into that certain Affordable Housing Agreement dated as of June 8, 2026, and recorded in the real property records of Ventura County, California as Document No. on June __, 2026 (the “Agreement”) related to the development of a 240-unit housing community to be built on certain real property located in the City of Simi Valley, County of Ventura, State of California (the “Project”).

B. Pursuant to the Agreement , Assignor has agreed to construct the Project and designate 238 of the residential units as affordable units and City has agreed to provide Assignor non -monetary concessions toward the development of the Project.

C. Assignor desires to transfer all of Assignor’s right, title and interest in and to, and obligations under, the Agreement and Assignee desires to accept such assignment from Assignor and to assume and be bound by all of the terms and conditions of the Agreement.

D. Assignee confirms that, at least 30 days prior to City’s receipt of assignment, they have been fully informed of the terms of the Agreement and the benefits/burdens conferred therein and agree to assume all duties and obligations, as well as the rights and benefits that the Assignor enjoys under the terms of the Agreement.

A G R E E M E N T:

NOW, THEREFORE, in consideration of the foregoing recitals, which are a part of this Assignment, and the mutual covenants and undertakings hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Owners do hereby agree as follows:

1. Assignment. As of the Effective Date, Assignor hereby assigns, conveys, transfers and sets over unto Assignee, any and all right, title and interest of Assignor in and to, and all obligations of Assignor under, the Agreement. 41 2. Assumption. By its execution of this Assignment and pursuant to paragraph three of Exhibit “ G” of the Agreement, Assignee agrees to, as of the Effective Date, assume and perform all obligations of Assignor under the Agreement.

3. Governing Law. This Assignment shall be construed under and enforced in accordance with the laws of the State of California.

4. Further Assurances. Assignor and Assignee each agree to execute and deliver to the other party, upon demand, such further documents, instruments and conveyances, and shall take such further actions, as are reasonably necessary or desirable to effectuate this Assignment.

5. Successors and Assigns. This Assignment shall inure to the benefit of, and be binding upon, the successors, executors, administrators, legal representatives and assigns of the parties hereto.

6. Facsimile Signature; Counterparts . This Assignment shall be effective and enforceable against the parties hereto if executed by facsimile signature and/or in multiple counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same document.

IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment on the date first set forth above.

ASSIGNOR:

Affordable Housing Land Consultants LLC,
a California limited liability company

By:________________________________
Alexis Gevorgian, Managing Member

ASSIGNEE:

2267 Tapo St Ground Owner LP

By:________________________________
Steve Wylder, Executive Vice President

42 CONSENTED TO:

City hereby consents to the Assignment and to the terms of said Assignment and hereby agrees to accept performance under the Agreement from Assignee.

IN WITNESS WHEREOF, City has executed this Assignment on the date first set forth above.

CITY:

The City of Simi Valley
a municipal corporation

By: ________________________________
Name: Samantha C. Argabrite
Title: City Manager

ATTEST:

By: _________________________________
Lucy Blanco, City Clerk

APPROVED AS TO FORM
Burke, Williams & Sorensen, LLP

By: ______________________________
Algeria Ford, City Attorney

43 Attachment D

REQUESTED BY AND WHEN
RECORDED MAIL TO:

CITY OF SIMI VALLEY
Attn: City Clerk
2929 Tapo Canyon Road
Simi Valley, CA 93063

[SPACE ABOVE FOR RECORDER'S USE ONLY]

This document is recorded for the benefit of the City of Simi Valley and therefore is exempt from the payment of a
recording fee pursuant to Government Code Section 6103
and 27383.

APNs: 618-0-160-145

CITY OF SIMI VALLEY

AMENDED AND RESTATED

AFFORDABLE HOUSING AGREEMENT/RENTAL

2267 TAPO ST GROUND OWNER LP

The land referred to in this Affordable Housing Agreement/Rental is situated in the City of Simi Valley, County of Ventura, State of California at 2267 Tapo Street, a 2.63- acre property, more particularly described in Exhibit “A”, attached.

These Restrictions provide rights to the City of Simi Valley in regulating the rental of the subject 240 -unit apartment project, for a period of fifty -five (55) years from the issuance of a Certificate of Occupancy as more fully set forth herein.
44 AMENDED AND RESTATED AFFORDABLE HOUSING AGREEMENT

TAPO STREET APARTMENTS

2267 TAPO ST GROUND OWNER LP

THIS AMENDED AND RESTATED AFFORDABLE HOUSING AGREEMENT
("Agreement") dated as of June 18, 2026 (the “Effective Date”) is entered into among the City of Simi Valley, California, a municipal corporation, hereinafter referred to as “City” and 2267 Tapo St Ground Owner LP, a Delaware limited partnership, hereinafter referred to as “Owner,” each a “Party,” and collectively, “Parties”.

W I T N E S S E T H:

RECITALS

A. The Project Site consists of approximately 2.63 acres located in the City of Simi Valley, County of Ventura, State of California, as described in Exhibit “A” , hereinafter referred to as the "Project Site".

B. The City and
Affordable Housing Land Consultants LLC entered into that certain Affordable Housing Agreement dated June __, 2026, recorded on June __, 2026, as instrument number (Original Agreement).

C. The Original Agreement referenced approvals for Planned Development Permit (PD-S-2025-0007), requiring the construction of develop a 240-unit housing apartment project containing 238 affordable housing units and two (2) unrestricted manager’s unit , with 165 Low-Income Units and 73 Very-Low Income Units (“Project”).

D. The City has provided the Owner five (5) non-monetary concessions toward the development of the proposed Project.

E. The Original Agreement is being amended to replace
Affordable Housing Land
Consultants LLC with Owner. Pursuant to that certain Ground Lease Agreement between Owner and Simi Valley Pacific Associates II, LP, a California limited partnership (the “Partnership”), dated as of June __, 2026 (as may be amended from time to time, the “Ground Lease”), the Partnership shall use and occupy the Project Site for the Project and other lawful purposes which are both associated and related to the Project.

NOW THEREFORE, in consideration of the mutual promises, obligations, and covenants herein contained, the City and Owner agree as follows:

45 SECTION 1 – DEFINITIONS

Unless the contrary is stated or clearly appears from the context, the following definitions will govern the construction of the words and phrases used in this Agreement:

1.01 “AHU” or “Affordable Housing Unit” means each of the two hundred thirty -eight units within the Project, unit size (to be determined) adjusted according to family size, which are reserved for rental to Qualified Tenants in accordance with the terms of this Agreement.

1.02 “Affordable Rent” means: for a Very Low -Income Household, a monthly rent that does not exceed 1/12th of 30% of fifty percent of the Area Median Income for a household size appropriate to the Unit; OR for a Lower -Income Household, a monthly rent that does not exceed 1/12th of 30% of eighty percent of the Area Median Income for a household size appropriate to the Unit. The maximum monthly rental amount of the Units must be adjusted annually by the formula set forth above upon the promulgation of revised Area Median Income figures; provided, however, for so long as the Project Site is encumbered by a tax credit regulatory agreement with the California Tax Credit Allocation Committee (“CTCAC”), Affordable Rent for each AHU shall be established strictly in accordance with the rent schedules published by CTCAC. Actual rent charged may be less than such maximum rent.

1.03 “Area Median Income” or “AMI” means the annual median income, adjusted according to household size, for the County of Ventura, as most recently published and updated by the United States Department of Housing and Urban Development (“HUD”) and as set forth in 25 California Code of Regulations Section 6952, or any other comparable source City deems appropriate.

1.04 “Director” means the Environmental Services Director of the City of Simi Valley.

1.05 “Gross Income” means all payments from all sources received by a person (together with the gross income of all persons of the age of 18 years or older who intend to reside with such person in one residential unit), whether in cash or in kind as calculated pursuant to HUD Regulations in effect as of the Date of this Agreement.

1.06 “HUD” means the U.S. Department of Housing and Urban Development or any successor agency.

1.07 “Income Limit Schedule” means the Schedule of Income Limits for the County of Ventura most recently published and updated by HUD and as set forth in 25 California Code of Regulations Section 6952 including the Lower -Income and Moderate-Income Limits for Ventura County, adjusted by household size. 46 1.08 “Initial Rent” means the amount charged to a Qualified Tenant for first occupancy of an AHU immediately after the Certificate of Occupancy or equivalent is issued for the Project.

1.09 “Initial Rent Date” means the first occupancy date of an AHU by a Qualified Tenant immediately following the issuance of a Certificate of Occupancy or equivalent for the Project.

1.10 “Initial Tenant Costs” means all deposits and fees, exclusive of the first month’s rent, charged to a Qualified Tenant before occupying an AHU.

1.11 “Lower-Income Household” means persons and families whose incomes do not exceed the qualifying limits for lower -income families, in accordance with Health and Safety Code Section 50079.5.

1.12 “Manager” means that person (or persons) who resides within the Project and has been hired by Owner to provide on-site management duties.

1.13 “Qualified Tenant” means a renter household or rental applicant household who meets the income criteria herein for eligibility as a Very Low -Income or Lower - Income Household at the time of the initial tenancy (i.e., the date of initial occupancy as evidenced by execution by the tenant household of the initial Lease or Rental Agreement with the Owner).

1.14 “Restricted Rental Rate” means a rental payment regulated by the terms of this Agreement.

1.15 “Very Low-Income Household” means persons and families whose incomes do not exceed the qualifying limits for very low-income families, in accordance with Health and Safety Code Section 50105.

SECTION 2 - DESIGNATION OF AFFORDABLE HOUSING UNITS;

REGULATORY INCENTIVES

2.01 Designation of a 240 -Unit Apartment Project Containing 238 Affordable Housing Units and 2 unrestricted manager’s unit. City and Owner agree on the provisions of this Agreement , which require that 238 units in the 240 -unit Project be designated to be occupied exclusively by Qualified Tenants at the restricted rents identified in Paragraphs 5.01 and 5.03 (the “AHUs”). The AHU distribution must be as shown in Exhibit “B” hereto. The Owner will have the right to restrict the remaining units in the Project in accordance with CTCAC standards without the consent of the City, provided that such restrictions comply with all applicable laws.

2.02 Incentives and Waivers. Owner acknowledges receipt of density bonus, and two concessions and f ive waivers under the Density Bonus Law in exchange for Owner’s agreement to restrict the rents of the AHUs. In conformance with Section 65915(f)(b)(1)(G), a project is permitted an 80% density bonus when 100% of a 47 project’s units are designated to low ‐income households, with the exception of manager’s units, except that up to 20% can be set aside for moderate income. City also granted the following concessions (“Concession”) pursuant to Government Code Section 65915(d)(1) and the Simi Valley Municipal Code (“SVMC”):

City also granted, the following waivers (“Waivers”) pursuant to Government Code Section 65915(e)(1), (k)(1), and the SVMC:

(a) Waivers (Unlimited)

1. Maximum Height (Stories) [ESVSP Table 3.4]: This standard requires a maximum height of 4 stories. The project proposes a maximum of 6 stories with tiered heights along Tapo and Winifred Streets. Applying this standard to the project would require reducing the project’s height by 2 stories and remove 84 units. If a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development standard must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. a 240‐unit project. This request also qualifies as a concession because it results in actual and identifiable costs by increasing the total cost per unit in land price per unit soft costs.

Applying this standard to the project would require reducing the project’s height by 2 stories and removing 84 units. If a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development standard must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. a 240‐ unit project. This request also qualifies as a concession because it results in actual and identifiable costs by increasing the total cost per unit in land price per unit soft costs.

If a development standard reduces an allowable unit count by just one unit, it is still just ified to be a waiver request. Thus, this development standard 48 must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. a 240‐ unit project. This request also qualifies as a concession because it results in actual and identifiable costs by increasing the total cost per unit in land price per unit soft costs.

4. Step‐backs [ESVSP 3.7.F]: This standard requires that along Tapo Street that stories above the second floor be stepped back from the front setback line at a minimum of five feet and stories above the third floor must be stepped back an additional 10 feet for 50% of the façade. The project proposes a step back starting at the fifth floor, but does not propose step‐ backs from the second to fourth floors. Applying this standard to the Tapo frontage of the project would require removing 14 units. In the event that a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. Thus, this development standard must be waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. a 240 ‐unit project. This request could also qualify as a concession because it would result in actual and identifiable cost s and would increase the total cost per unit in land price and cause an increase in per unit soft costs.

5. Storage Areas [Simi Municipal Code Section 9-24.060.B.2.b]: This standard requires that each unit within multi -family residential projects be provided with a storage area “attached to the unit, garage, or attached carport.” If a small storage room were provided for each unit on every floor, then we estimate losing two units per floor or 10 units in total. In the event that a development standard reduces an allowable unit count by just one unit, it is still justified to be a waiver request. This development standard is hereby waived because it would have the effect of physically precluding construction of the project at the proposed density, consistent with density bonus law, i.e. 240-unit project.

(b) Concessions

1. Residential Private Open Space [ESVSP Section 3.3.H.1.b]: This standard requires that a minimum of 70 square feet of private open space be provided for each unit as either a balcony or patio. The project does not propose any private open space. The majority of these units would re quire balconies, which results in high construction costs , including but not limited to structural support, waterproofing, railings, and special annual inspections.

We estimate approximately 207 of the units will require a balcony and 33 units on the second floor facing the outdoor podium courtyards will require a private patio. We estimate that this will cost approximately $15,000 to $30,000 per unit. If we incorporated private open space for all units then we expect an increase in the construction budget of approximately $3,600,000 49 to $7,200,000. The request for relief from residential private open space comports with density bonus law because it is clear that the cost savings is necessary to be able to provide affordable rents for the targeted units within the Project and as such, this demonstrates an actual, identifiable cost reduction within meaning of Section 65915(d).

2. Minimum Percent of Commercial Use [ESVSP Section 3.10, Table 3.4]:

This standard requires that a minimum of 10% of a project be dedicated for commercial uses. The project proposes 2,000 square feet, less than 1% of the total building area. If the project met this requirement then the 30,160 square feet total would need to be provided to meet the 10% requirement.

Therefore, an additional 28,160 square feet would be needed. To accommodate the additional commercial square footage, our proposed residential parking, and the necessary parking for commercial uses, a subterranean level of parking would need to be designed. Based on other similarly designed and constructed projects, a subterranean parking garage can cost $100‐ $110 per square foot. Consequently, assuming a subterranean parking garage level of about 30,000 square feet to accommodate some parking stalls relocated from the ground floor, this modification alone could increase construction costs by approximately $3,000,000 to $3,300,000, or an additional cost of $12,500 to $13,750 per unit. A concession from this standard is necessary to provide the units at the targeted density and affordability levels, resulting in an identifiable and actual cost reduction.

SECTION 3 - TERM

3.01 Term of Agreement . Pursuant to the Density Bonus Law, the term of this Agreement begins on the date the Building Official issues a final Certificate of Occupancy, or equivalent, for the Project and remains in full force and effect for a period of 55 years afterward.

3.02 Restricted Rental Period. City and Owner agree that the Restricted Rental Period commences on the Initial Rent Date for the first unit rented under this Agreement and terminates 55 years after the Building Official issues a final Certificate of Occupancy or equivalent for the Project.

SECTION 4 - COMMENCEMENT OF CONSTRUCTION/TIME CONSTRAINTS

4.01 Maintenance of Entitlements. Owner must maintain compliance with PD -S-2025- 0007 including extensions and/or modifications. Any violation of PD -S-2025-0007 may result in the City declaring this Agreement null and void.

4.02 Inspection of AHUs. The AHUs must receive final inspection approval no later than the date that the market-rate units receive final inspection and approval. Time is of the essence in the occupancy of the AHUs.
50 4.03 Rent Up. The Owner agrees to rent at least five AHUs to Qualified Tenants within six months thereafter receiving a Certificate of Occupancy for any of the units in the Project.

SECTION 5 - RENTS

5.01 Initial Rents. The initial gross rent for each AHU in the Project (the “Initial Rents”) must conform with the allowable “Affordable Rent” for Very Low-Income or Lower- Income Households, as defined in Health and Safety Code Section 50053. For Very Low-Income Households, the Initial Rent must be the product of 30% times fifty percent of the Area Median Income for Ventura County adjusted for household size appropriate for the unit, and for Lower -Income Households, the Initial Rent must be the product of 30% times eighty percent of the Area Median Income for Ventura County adjusted for household size appropriate for the unit, or if the household is a Section 8 voucher holder, the fair market rent as qualified by Section 8 program with the tenant portion of the rent not exceeding 30% of the household income; provided, however, for so long as the Project Site is encumbered by a CTCAC tax credit regulatory agreement, Initial Rents for each AHU shall be established strictly in accordance with the rent schedules published by CTCAC. Initial Rent must be adjusted by the utility allowance established by the Area Housing Authority of the County of Ventura, except as provided in Paragraph

6.03 of this Agreement.

5.02 Security Deposits. Total deposits, including security deposits and any other initial costs required of the Qualified Tenant occupying an AHU, other than the first month’s rent, cannot exceed the tenant portion of one month’s gross rent (without deduction of utility allowance) as determined under Paragraphs 6.01 or 6.03. If the security deposit exceeds $500, upon request of the Qualified Tenant, s/he is allowed to pay the deposit in three equal monthly installments , which is due, together with the monthly rent upon execution of the rental agreement, and on the rent due date of the following two months of occupancy of the AHU. Monthly installments are credited to tenant’s security account. The security deposit cannot be increased as long as the tenant resides in the same unit.

5.03 Rent Adjustments.

(a) “Adjustment Date” means 90 days after HCD issues updated AMI limits or CTCAC issues updated rent limits, but in any event, not more frequently than annually as long as this Agreement remains in effect. (b) On each Adjustment Date, the annual rent increase for each of the AHUs is limited to not more than the lesser of the following:
i. 5% + Consumer Price Index (“CPI”); or
51 ii. The percentage increase in the Median Income Limit for Ventura County.
(c) Notwithstanding subparagraph (b), in no event may the tenant portion of the rent for any Very-Low-Income Affordable Housing Unit exceed thirty 30% of fifty percent of the Area Median Income amount, adjusted for household size as established by the California Department of Housing and Community Development, whichever is lower; and in no event may the tenant portion of the rent for any Lower -Income Affordable Housing Unit exceed thirty 30% of eighty percent of the Area Median Income amount, adjusted for household size as established by the California Department of Housing and Community Development, whichever is lower.

SECTION 6 - METHOD OF RENTAL

6.01 Classification. Any unit occupied by a Qualified Tenant as determined per Paragraph 7.01 is considered to have satisfied the occupancy requirements set forth above; therefore, must be subject to the Affordable Rent restrictions provided in this Agreement and must continue to satisfy such requirements if the tenant is recertified as a Qualified Tenant in accordance with Paragraph 7.02.

SECTION 7 - DETERMINATION OF TENANT ELIGIBILITY

7.01 Qualification. Owner is responsible for determining, in accordance with the provisions of 25 California Code of Regulations Section 6910, et seq., as those sections may be amended, the income eligibility of a potential AHU renter household. On the date an AHU is leased, the gross annual income of a Qualified Tenant occupying said unit cannot exceed the limit for Very Low-Income or Lower- Income Household for Ventura County, as adjusted for the tenant’s household size. Gross income calculations for prospective (and continuing) tenants are determined in accordance with 25 Cal. Code of Regs. Section 6914. Owner must determine income qualification of an applicant tenant household by obtaining and reviewing required income records from each member of such tenant household.

Such records should include, without limitation, the most recent federal income tax return of each member of said tenant household, bank records, Social Security Administration statements, pay stubs or other documentation, which verified th e household’s annual income (the “Supporting Documentation”). Additionally, Owner must obtain written certification of the anticipated income of all non-minor members of the tenant household for the 12-month period following the date of determination of in come. Also, Owner must complete and provide to the City an Affordable Housing Program Tenant Certification, Exhibit “B,” before use and City reasonably approves such use. Each AHU rented to a Qualified Tenant must be occupied by that household. Further, any AHU cannot be occupied by the Manager, and the Manager’s unit cannot be designated as an AHU.

7.02 Tenant Recertification . Tenant Recertification means the Owner’s annual verification of a Qualified Tenant’s income conducted in accordance with 52 Paragraph 8.01. At least 60 days before each Adjustment Date, Owner must provide written notice to AHU occupants to complete an Affordable Housing Program Tenant Recertification, Exhibit “C,” and to provide supporting income verification documentation to the Owner before the Adjustment Date. In the event that the tenant fails to provide proof of income to Owner on or before the Adjustment Date, such tenant is deemed to have committed a material breach of the Lease Agreement and the Lease Agreement must provide that such breach is cause for termination of tenancy. Owner cannot renew the tenant’s lease without such proof of income. Subject to the limitations of State and Federal law, no tenant residing in an AHU can be denied continued occupancy, solely because their household income has increased such that it exceeds the limits for Lower-Income or Moderate-Income Households for Ventura County, adjusted for household size pursuant to Paragraph 2.07. Owner must keep copies of all AHU Tenant Recertification forms on file and make them available to City upon request.

7.03 Change in Household Composition/Income. Owner is responsible for, in accordance with the provisions of the HUD Multifamily Occupancy Handbook 4350.3 Chapter 7, annual recertification, interim recertification (change in household composition), unit transfers, and gross rent changes.

SECTION 8 - OUTREACH PROGRAM

8.01 Outreach and Affordable/Affirmative Marketing Program . Owner must submit for approval a detailed Outreach and Affordable/Affirmative Marketing Program (the “Marketing Program”), which includes, without limitation, advertising, publicity and promotion, to the Director not less than 120 days before the projected completion of the Project. Owner may not commence marketing efforts of the AHUs as part of its overall Marketing Program for the Project, before the Director approves the Marketing Program, which approval should not be unreasonably withheld or delayed. The purpose of the Marketing Program is to solicit and obtain Qualified Tenants for occupancy of all AHUs, to establish a waiting list for units that may become available and to affirmatively further fair housing goals by designing a program that attracts prospective Qualifying Tenants of all majority and minority groups in the housing market area regardless of race, creed, color, religion, sex, national origin, marital status, status with regard to receipt of public assistance, or disability. The Marketing Program should ensure that any persons normally not likely to apply for the AHUs without special outreach efforts, know about the availability of the AHUs, feel welcome to apply and have the opportunity to rent an AHU. The marketing program must begin before the occupancy of any apartment units within the Project and must include the following:
(a) A print media schedule as shown on attached Exhibit “D,” which is incorporated by reference, to be published in a newspaper of City -wide or regional circulation;
(b) Noticing and listing the Project throughout the life of this Agreement with the Area Housing Authority of Ventura County, the Simi Valley Senior Center, 53 City Hall, Simi Valley Public Library, and, as appropriate for market conditions, the Conejo Simi Moorpark Association of Realtors, Simi Valley faith community, and such other similar agencies as the Director may designate;
(c) Notifying all persons on the Owner’s waiting list for affordable rental housing; (d) Establishing of a telephone number for the Project with message capabilities to receive inquiries on vacant units, including the AHUs throughout the life of this Agreement;
(e) Continuous display of the fair housing logo in the rental office and in advertising;
(f) Budgeting to adequately fund the reasonably necessary expenses of the foregoing.

8.02 Waiting List.

(a) From the commencement of the Outreach and Marketing Program and through the Restricted Rental Period, Owner must establish and maintain a waiting list regarding the applicants for the AHUs and select the prospective Qualifying Tenants on a first-come, first-served basis. The waiting list must include the information requested in Exhibit “E.” In no event may the waiting list be closed during the Restricted Rental Period by Owner.

(b) Owner will not be obliged to rent an AHU to a potential renter on a waiting list unless such potential renter agrees to and does enter into a Lease Agreement which provides that the potential renter agrees to occupy the AHU no later than: (a) forty -five days after Owner notifies such potential renter that the AHU is available for occupancy, or (b) thirty days after such AHU is vacated by the prior tenant, whichever is later.

8.03 Initial Marketing Within the City. The Marketing Program must be no less intensive in the City of Simi Valley as compared to any other region

8.04 Awareness of the AHU Availability. Owner must design the Marketing Program to include provisions that create and build audience awareness of the availability of AHUs and equal housing opportunities.

8.05 Failure to Implement an Outreach Program . If Owner fails to submit for approval and implement the Marketing Program, City has the right to implement a marketing 54 program, at Owner expense, for the purpose of soliciting Qualified Tenants for Owner’s AHUs.

8.06 Prioritization and Selection of Potential Tenants . DEVELOPER agrees to begin advertising the AHUs at least four months before the projected date of completion of construction of the AHUs, and to begin accepting applications for the AHUs at the same time

SECTION 9 - NOTICES AND DISCLOSURES

9.01 Notices. During the Restricted Rental Period, Owner must provide the following notices to tenants at the inception of each AHU tenancy:

(a) Housing Information. Owner must provide tenants and prospective tenants with information on fair housing regulations and the State and Federal agencies responsible for enforcing them.

(b) Adjustment Date. Owner must inform each tenant, in writing at the time of occupancy of an AHU, the next Adjustment Date for that unit.

Owner must be responsible for obtaining proof that these items were received by the tenants and must keep such proof in the tenant files for inspection by City, if requested. This may be accomplished by having the tenants initial the lease that they have received the above information.

9.02 Expiration. Owner must comply with the requirements of Government Code Section 65863.10 and any other then-applicable federal, state or local laws related to the expiration of the affordability period.

9.03 Right of First Refusal ; Preservation Notices. During the term of this Agreement, Owner must be in compliance with Government Code Section 65863.11 and any other then-applicable sections of California law.

9.04 Subleasing Restricted. As part of every rental agreement, Owner must provide a clause which, by its terms, prohibits to the fullest extent allowed by law, the subject AHU tenant from assigning, subleasing or transferring any interest in the unit to another without obtaining the City's prior written approval. No such approval will be granted for any sublease which provides for rent or tenant income in excess of that authorized herein. This provision must not prohibit Owner and the AHU tenant from entering into a new rental agreement to add additional household members, provided that the new tenant household is determined to be eligible in accordance with Section 7.01.

9.05 City Notification . Owner must make available to City copies of all notices and housing information delivered under Paragraphs 9.01 through 9.04 within three (3) business days of demand by City. All notices required by Paragraphs 9.01 through 55 9.04 must be set forth in bold- faced or capitalized letter, in a type face of at least 12 points, and must be separately initialed by the tenants.

9.06 Notice of Non- Compliance. Upon City determination of a material breach by Owner of the terms of this Agreement, City must, within ten (10) working days after becoming aware of such material breach, provide written notice of the same to Owner in accordance with Paragraph 16.1 2 herein, describing the nature of said breach.

9.07 Records. Owner must maintain complete, accurate, and current records pertaining to the Project, and must permit any duly authorized representative of the City to inspect records, including records pertaining to income, age, and household size of residents. All Resident lists, applications, and waiting lists relating to the Project must at all times be kept separate and identifiable from any other business of the Owner and must be maintained as required by the City, using record -k
eeping
forms provided by the City (Exhibits “B” through “F”), or on forms acceptable to the City, in a reasonable condition for proper audit and subject to examination during business hours by representatives of the City. The Owner must retain copies of all materials obtained or produced with respect to occupancy of the AHUs from application to move-out and for a period of 5 years thereof.

S
ECTION 10 - CONDITION AND MAINTENANCE OF UNITS/PROJECT

10.01 Project Architecture. All units in the Project must have the same architectural, exterior, and interior treatments, with the exception of the units to be occupied by the Managers.

10.02 Project Maintenance. Owner must ensure that sufficient revenues are reserved and expended for maintenance of the Project as required by all applicable laws, and so as to maintain all areas of the Project in a well -kept condition, order and repair, safe, attractive and continuously functional in accordance with all state and local codes and regulations. Owner further agrees that such maintenance must be performed in a workmanlike manner on a regular basis and/or as needed and at times which will minimize inconvenience to tenants.

SECTION 11 - REPORTING AND AUDIT REQUIREMENTS

11.01 Status Reports. Beginning on the first anniversary of the Initial Rent Date for the first AHU rented in the Project, and continuing on each such annual anniversary thereafter during the Restricted Rental Period, Owner must submit the following written reports to the Director of Environmental Services:

(a) A copy of the waiting list (Exhibit "E"),

(b) A Unit Summary Report of all Affordable Housing Units (Exhibit "F").

56 11.02 Audit. Owner must permit the City, with reasonable notice and during normal business hours, to inspect the Project Site to verify Owner’s compliance with this Agreement. Owner must make available to the City, during normal business hours, such records as the City may reasonably request to verify such compliance.

Should Owner fail to submit timely reports as required by Paragraph 11.01 above, City may cause an audit to be conducted at the sole expense of Owner, in addition to any other available legal remedies. Owner must cooperate with any such audit and further agrees to make available to the City all documents relative to rental of the AHUs to verify compliance with the terms of this Agreement.

SECTION 12 - ENFORCEMENT PROVISION

12.01 Enforcement. City has the authority to enforce all the provisions of this Agreement, including the Covenants and conditions contained herein. City may take any enforcement action permitted by law, including but not limited to, a civil action for specific performance of the restrictions and terms of this Agreement, damages for breach of contract, restitution and injunctive relief. The remedies provided herein are cumulative and not exclusive and does not preclude City from seeking any other remedy to which it otherwise would be entitled under law or equity.

SECTION 13 - SUCCESSORS AND ASSIGNS

13.01 Successors and Assigns. The parties hereto each agree that the obligations and duties contained herein are binding upon the City and Owner, and their respective successors and assigns. Owner and its successors cannot assign its rights or delegate its duties or obligations, or s ell, transfer, convey, encumber, assign or lease any of the AHUs (other than for individual tenant use as contemplated hereunder). City and its successors and assigns are deemed the beneficiary of the covenants contained herein, without regard to technical classification and designation. The covenants run in favor of City, its successors and assigns without regard to whether City has been, remains, or is an owner of any land or interest thereon. Other than the transfers described in Sections 13.04 and 16.20, Owner must provide at least fifteen (15) day notice to City before any proposed transfer to a successor or assign. Other than the transfers described in Sections 13.04 and

16.20, the assignee or successor must agree in writing to assume on behalf of itself and its successors and assigns, all the duties and obligations of the Owner under this Agreement, and any purported assignment will not be valid without such a written agreement.

13.02 Rights of Mortgage Holders. The provisions of this Agreement do not limit the right of the holder of any mortgage, deed of trust or other lien or encumbrance (collectively “Mortgage Holders”) to exercise any of its remedies for the enforcement of any pledge or lien upon the Property, provided however, that the obligations under this Agreement survive the exercise of such right through the remainder of the term of this Agreement pursuant to Paragraph 3.01.

57 13.03 Verification of Buyer's Managerial Qualifications. Owner must request approval by written notice at least forty-five (45) days prior to any proposed Assignment. There must be submitted to the City for review evidence of the qualifications and financial strength of any proposed buyer, transferee, conveyee, assignee or lessee along with all instrument and other legal documents proposed to effect any such sale, transfer, conveyance, assignment or lease, and, if approved by the City, such approval will be indicated to Owner in writing. It will not be unreasonable for the City to withhold its consent if the proposed buyer, transferee, conveyee, assignee or lessee will lack the managerial qualifications and financial responsibility necessary and adequate, as may be reasonably determined by the City, to fulfill the obligations of Owner contained in this Agreement. Any proposed buyer, transferee, conveyee, assignee or lessee, by instrument in writing satisfactory to the City and in form recordable among the land records, for itself and its successors and assigns, and for the benefit of the City, will expressly assume the conditions, restrictions, limitations and provisions, whether such successor's title was acquired by foreclosure, deed in lieu of foreclosure, trustee's sale or otherwise. It is hereby expressly stipulated and agreed that any sale, transfer or other disposition of the Project in violation of this Paragraph will be null, void and without effect, will cause a reversion of title to the Owner and will be ineffective to relieve the Owner of its obligations under this Agreement.

13.04 Rights of Owner. City hereby acknowledges the Ground Lease and agrees that it will not oppose or require consent for any internal restructuring of the Owner corporation. However, any assignment or transfer of ownership interest in the Project Site to a different person or entity as defined by law is subject to the prior written consent of the City Council.

Notwithstanding any contrary provision hereof, the exercise of remedies by the Owner under the Ground Lease and/or any transfer in connection therewith is permitted without the prior approval of the City. In the event that Owner exercises remedies pursuant to the Ground Lease, including termination thereof, Owner shall not be liable to City for any defaults or monetary obligations of the Partnership or its respective successors and/or assigns under this Agreement arising prior to such termination. Owner shall not be obligated to construct or continue construction of the Project.

SECTION 14 - RECORDATION OF AGREEMENT

14.01 Recording Agreement. This Agreement must be recorded within ten (10) days of the execution of this Agreement by all Parties. Owner must also record, separate from this Agreement, the Declaration of Conditions and Restrictions on the Transfer of Title or Interest in Real Property document in the form of Exhibit " G", stating that the conditions and obligations to which the subject Project is bound will run with the land.

58 SECTION 15 - INDEMNITY AND HOLD HARMLESS

15.01 Indemnity and Hold Harmless.

(a) Owner must defend and provide legal defense with attorney(s) acceptable to the City, indemnify, and hold harmless the City, their agents, officials, officers, representatives and employees, from and against all claims, lawsuits, liabilities or damages of whatever nature arising out of or in connection with, or relating in any manner to any act or omission of Owner, its agents, employees, and subcontractors, and employees thereof, pursuant to the performance or non- performance of this Agreement other than solely arising from the negligence or willful misconduct of City. Owner must thoroughly investigate any and all claims and indemnify the City and do whatever is commercially necessary to protect the City, its agents, officials, officers, representatives and employees as to any such claims, lawsuits, liabilities, expenses, or damages arising out of this Agreement.

(b) Owner must not bring any claims, cross-claims, actions or cross-complaints against the City, its agents, employees or representatives, arising out of any disputes between Owner and third parties as to the City approvals or the issuance of building permits for this Project.

SECTION 16 - GENERAL PROVISIONS

16.01 Time is of the Essence. The Parties hereto agree that time is of the essence in the performance of this Agreement. No waiver by any of the Parties to this Agreement or the non- performance or any breach of any term, provision or condition of this Agreement or any default hereunder will be considered to be or operate as a waiver of any subsequent non-performance, breach or default.

16.02 Extension of Time Good Cause. The City may, in its sole discretion, extend one or more time deadlines for performance as referenced in this Agreement for good cause. “Good cause” includes, but is not limited to, acts of God, labor strikes, war, riots, pandemics, etc., as determined the City in its sole discretion.

16.03 Modifications. The Parties hereto each agree that no addition to or modification or waiver of any term or provision of this Agreement will be effective unless set forth in writing, in the same manner and form as originally adopted and signed by both the City and Owner except that the City reserves the right to make minor amendments to this Agreement, which may become necessary due to changes in governmental regulations or other requirements affecting the parties involved in the arrangement of project financing so long as such amendments do not materially or substantially modify the terms contained in this Agreement and do not add to the costs incurred by the City. The Parties hereto further agree that oral agreements or understandings will be of no force or effect whatsoever. 59 16.04 Not for the Benefit of Third Parties. This Agreement does not create any enforceable right, cause of action, or claim in any third party. The Owner, the City or their successors in interest are the sole parties who have standing to enforce the terms or obligations or to bring suit for damages arising out of a breach of this Agreement.

16.05 Not a Partnership or Joint Venture. This Agreement does not create a partnership or joint venture.

16.06 Subordination. Owner acknowledges that the City will not subordinate this Agreement or any of its terms or the separately recorded declaration of conditions and restrictions to any lien, encumbrance or mortgage for the Project.

16.07 Non-Discrimination. All of the Units must be available for occupancy on a continuous basis to members of the general public. Owner must not give preference to any particular class or group of persons in renting the Units, except to the extent that units are required to be leased to a Very Low - or a Low-Income Household.

Owner covenants by and for itself and any successors in interest that there must be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use occupancy, tenure or enjoyment of the Project nor will Owner itself, or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Project. The foregoing covenants will run with the land.

All leases or contracts made relative to the Project, the improvements thereon or any part thereof, must contain or be subject to substantially the following nondiscrimination clause:

"There must be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, gender, gender identity, gender
expression, sexual orientation, source of income, marital status, familial status, disability, medical condition, genetic 60 information, national origin or ancestry in the sale, lease, sublease, transfer, use occupancy, tenure, improvement or enjoyment of the Project nor will lessee, contracting party or signatory, nor any person performing, acting under or
operating through them, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the Project, or any other aspect of the Project."

16.08 Violation of Conditions of Approval. Any violation of the conditions of any of the Project Entitlements will also constitute a violation of this Agreement and will be enforceable as a breach hereof, as well as any other remedies.

16.09 Default. If Owner defaults in the performance or observation of any covenant, agreement or obligation set forth in this Agreement, and if such default remains uncured for a period of sixty (60) days after written notice must have been given by the City to Owner, then the City may declare an “Event of Default” to have occurred hereunder, and, at its option, may take any one or more of the following steps:

(a) By mandamus or other suit, action or proceeding at law or in equity, require the Owner to perform its obligations and covenants hereunder or enjoin any acts or things which may be unlawful or in violation of the rights of the City hereunder;
(b) Have access to and inspect, examine and make copies of all of the books and records of the Owner pertaining to the 238 AHUs;
(c) Take such other action at law or in equity a may appear necessary or desirable to enforce the obligations, covenants and agreements of the Owner.

16.10 Reserved.

16.11 Severability. The Parties hereto each agree that should any portion of this Agreement be held invalid or unenforceable for any reason, such determination will not affect the validity of the remaining portions of this Agreement.

16.12 Covenants to Run with the Land. Owner hereby subjects the Project (including the Project Site) to the covenants, reservations and restrictions set forth in this Agreement. The City and Owner hereby declare their express intent that the covenants, reservations and restrictions set forth herein will be deemed covenants running with the land and will pass to and be binding upon Owner’s successors in title to the Project; provided, however, that on the termination of this Agreement said covenants, reservations and restrictions will expire. Each and every contract, deed or other instrument hereafter executed covering or conveying the Project or any portion thereof will conclusively be held to have been executed, delivered and accepted subject to such covenants, reservations and restrictions regardless of 61 whether such covenants, reservations and restrictions are set forth in such contract deed or other instrument. Owner, by and for itself and each successor to any interest in the Project, hereby specifically acknowledges and agrees to be bound by the covenants contained herein.

16.13 Notices. The Parties hereto each agree that all notices or other communications required or permitted hereunder must be in writing, must be either personally delivered or sent by United States certified mail or registered mail, return receipt requested, and must be deemed received seventy-two (72) hours after deposited in the mail in the Counties of Ventura, Orange or Los Angeles, postage pre- paid, addressed to the persons to receive such notice, at the following address:

To City: City of Simi Valley
Attn: Environmental Services Director
2929 Tapo Canyon Road
Simi Valley, CA 93063

To Owner: 2267 Tapo St Ground Owner LP
c/o Safehold Inc.

Attention: General Counsel
1114 Avenue of the Americas
New York, NY 10036

With a Copy To: U.S. Bancorp Community Investment Corporation c/o U.S. Bancorp Impact Finance
505 North Seventh Street, 10th Floor
SL-MO-T10F
St. Louis, MO 63101
USB Project No: 35967
Attn: Director of LIHTC Asset Management

And

Kutak Rock LLP
1650 Farnam Street
Omaha, NE 68102
Attn: Jill Goldstein, Esq.

Or to the owner of record or successor in title to the subject Project.

Notice of change of address is required and must be given by written notice in the manner detailed in this Paragraph. Notices to a Qualified Tenant of an AHU will be deemed adequately given if transmitted in like fashion to the street address and apartment number of such a Qualified Tenant.

62 16.14 Attorney's Fees. The Parties hereto each agree that if any Party hereto institutes any legal proceedings to enforce any provision of this Agreement or for damages by reason of any alleged breach of this Agreement, the prevailing Party will be entitled to recover from the other Party all costs of suit, including such amount as the court may award as reasonable attorney's fees for services rendered to the prevailing Party in such proceeding. The Parties hereto further agree that partial granting of the pray ed-for relief will be sufficient to constitute "prevailing" in any such action.

16.15 Headings. The Parties hereto each agree that the paragraph headings herein are used only for the purpose of convenience and will not be deemed to modify, explain or limit the subject of the paragraphs of this Agreement to be considered in their construction.

16.16 Incorporation of Recitals and Exhibits . Recitals A through E are incorporated herein by this reference and Exhibits "A" through " G" are attached and incorporated herein by this reference.

16.17 Compliance with Applicable Laws. Owner must obey all Federal, State, local and special district laws, ordinances and regulations.

16.18 Entire Agreement. This Agreement, together with its attachments and writings expressly incorporated herein, constitutes the full and total understanding between the Parties hereto, construed according to the laws of the State of California, and supersedes all prior agreements between the Parties hereto.

16.19 Execution In Counterparts . This Agreement may be executed in any number of counterparts, each of which, when executed and delivered to City, will be deemed to be an original and all of which, taken together, will be deemed to be one and the same instrument.

16.20 Tax Credit Provisions. The Parties agree and acknowledge that the Project may be financed, in part, with the proceeds for federal and/or state low income housing tax credits (“Tax Credits”). If the Project is financed with Tax Credits, the following provisions will apply:

(a) The City must accept any cure of any default by Owner tendered by any limited partner (which limited partner must not have management or control of Owner) of the Owner (the "Limited Partner") on the same terms and conditions it would accept said cure by Owner; provided that, such Limited Partner must certify in writing that its cure of said default is not for the sole purpose of avoiding the provisions of this Agreement relating to the City’s consent to assignment.

(b) The City must provide copies of all notices provided to Owner pursuant to this Agreement to the Limited Partner at the address so des ignated in 63 writing by the Owner from time to time ; provided that the failure to provide such notice will not be deemed a default by City.

(c) Notwithstanding anything to the contrary set forth in the Agreement, including, without limitation, Section 13.01 thereof, the consent of the City will not be necessary for any of the following: (i) a transfer of the Limited Partner's interest in the Owner, or an interest in the Limited Partner, or (ii) the removal and replacement of a general partner of Owner by the Limited Partner in accordance with the partnership agreement of the Owner provided that the substitute general partner is acceptable to City in its reasonable discretion.

(d) In the event of any conflict between this Section 16. 20 and any other provision of the Agreement, this Section 16.20 will prevail.

IN WITNESS THEREOF, the Parties hereto have executed this instrument as of the Effective Date.

Attest: City of Simi Valley
A Municipal Corporation

Lucy Blanco, City Clerk Dee Dee Cavanaugh, Mayor of the City of Simi Valley, California

Approved as to Form: 2267 Tapo St Ground Owner LP
a Delaware Limited Partnership

Algeria R. Ford, City Attorney By: ,

Approved as to Content:

Samantha C. Argabrite,
City Manager

Stratis Perros
Environmental Services Director
64 EXHIBIT "A"

LEGAL DESCRIPTION

REAL PROPERTY IN THE CITY OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, DESCRIBED AS FOLLOWS:

THE SOUTHERLY 120.00 FEET OF THE NORTHERLY 200.00 FEET MEASUREMENT

ALONG TAPO STREET OF THAT PORTION OF THE NORTHEAST QUARTER OF SECTION 12, TOWNSHIP 2 NORTH, RANGE 18 WEST, RANCHO SIMI, IN THE CITY

OF SIMI VALLEY, COUNTY OF VENTURA, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 5, PAGE 24, OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS FOLLOWS:

1ST: SOUTH 89º 57' 25" EAST 588.62 FEET TO A POINT ON THE WEST LINE OF TAPO STREET 60.00 FEET WIDE AS SAID STREET IS NOW ESTABLISHED; THENCE

ALONG SAID WEST LINE,

2ND: NORTH 0º 03' 00" EAST 425.10 FEET TO A POINT; THENCE LEAVING SAID

WEST LINE,

4TH: SOUTH 0º 02' 35" WEST 425.10 FEET TO THE POINT OF BEGINNING.

EXCEPT THEREFROM AN EXISTING WATER WELL SITE 70 FEET BY 70 FEET

SQUARE, LOCATED IN THE NORTHWESTERLY PORTION OF SAID LAND,

TOGETHER WITH THE PUMPING PLANT MACHINERY INCIDENT THERETO, ALSO

TOGETHER WITH APPURTENANT EASEMENTS FOR INGRESS AND EGRESS, WATER PIPELINES AND INCIDENTAL PURPOSES, AS RESERVED BY MORRIS G.

ROSE, ET AL., IN DEED RECORDED AUGUST 16, 1960, IN BOOK 1899, PAGE 161, OFFICIAL RECORDS.

ALSO EXCEPTING THEREFROM AN UNDIVIDED 1/2 INTEREST IN AND TO ALL OIL,

GAS, MINERALS AND OTHER HYDROCARBON SUBSTANCES IN, ON OR UNDER

SAID LAND, BUT WITHOUT THE RIGHT, HOWEVER, OF SURFACE ENTRY AND

65 ALSO EXCEPTING AN UNDIVIDED 1/2 INTEREST IN AND TO ALL OIL, GAS,

MINERALS AND OTHER HYDROCARBON SUBSTANCES IN, ON OR UNDER SAID LAND AS RESERVED BY MORRIS G. HARRIS, ET AL., IN DEED RECORDED AUGUST 16, 1960, IN BOOK 1899, PAGE 161 OFFICIAL RECORD.

APN: 618-0-160-145

66 EXHIBIT “B”

CITY OF SIMI VALLEY

AFFORDABLE HOUSING PROGRAM TENANT CERTIFICATION

TAPO STREET APARTMENTS, SIMI VALLEY

Manager:

Name: Date:

Address: Phone:

Number of persons in household:

List all persons who reside in unit:

Name

Social Security Number

Age*

*Information on age only required for age restricted projects.

Total Household Income:

1) Previous Year Annual Gross Income (Attach Verification)

Name

Source

Amount

Total Gross Monthly Income:

67 2) Current Monthly Gross Income (Attach Verification)

Name

Source

Amount

Total Gross Monthly Income:

Acknowledgment of this paragraph does not constitute written permission.

Signed: Date:

FOR CITY OFFICE USE ONLY
Anticipated Income
Next 12 Months: Household Size:

Income Level: Lower (80%) Comments: _____________________ Income Level: ______ Very - Low (50%)

Approved for Affordable Unit Reviewed by:

Not Approved Date:

68 EXHIBIT “C”

CITY OF SIMI VALLEY

AFFORDABLE HOUSING PROGRAM TENANT RECERTIFICATION

TAPO STREET APARTMENTS, SIMI VALLEY

Manager:

Name: Date:

Address: Phone:

Number of persons in household:

List all persons who reside in unit:

Name

Social Security Number

Age*

*Information on age only required for senior-oriented projects.

Total Household Income:

1) Current Monthly Gross Income (Attach Verification)

Name

Source

Amount

Total Gross Monthly Income:

The information on this form is provided solely for the purpose of determining eligibility for the City of Simi Valley Affordable Housing Program. This information is confidential and, except as may be required by the City of Simi Valley or Owner, any use of this information is strictly prohibited without written consent of the applicant. Acknowledgment of this paragraph does not constitute written permission. 69 I/We certify that the foregoing is complete, true, and accurate to the best of my/our knowledge and is verifiable by the most recent federal tax return and other income documentation provided herewith. I/We are aware that any misrepresentation in this application will constitute a material breach of my/our agreement with the Owner to rent or lease the unit, and will entitle the Owner to prevent or terminate my/our occupancy of the unit.

Signed: Date:

Signed:

Date:

FOR CITY OFFICE USE ONLY
Anticipated Income
Next 12 Months: Household Size:

Income Level:

Lower (80%) Comments: ____________________________
_____ Very - Low (500%)

Approved for Affordable Unit Reviewed by:

Not Approved Date:
70 EXHIBIT “D”

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT OUTREACH PLAN / PRINT MEDIA SCHEDULE

TAPO STREET APARTMENTS, SIMI VALLEY

PUBLICATION NAME AND CITY

DATES APPEARING

SIZE OF ADVERTISEMENT

FROM

_________________________________________________________________________________________________

OFFICE USE ONLY

ATTACHMENTS: __________ Certification of Publication
__________ Sample Copy of Text

71 EXHIBIT "E"

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT WAITING LIST

TAPO STREET APARTMENTS, SIMI VALLEY

PROJECT: DATE SUBMITTED:

MANAGER:

DATE NAME ADDRESS PHONE
# OF

BEDROOMS
PREFER
HOUSE-

HOLD SIZE
INCOME
LEVEL
(EL/VL)

DATE PLACED IN
UNIT

72 EXHIBIT “F"

CITY OF SIMI VALLEY

AFFORDABLE HOUSING AGREEMENT

UNIT SUMMARY REPORT OF ALL AFFORDABLE HOUSING UNITS

TAPO STREET APARTMENTS, SIMI VALLEY

PROJECT: DATE SUBMITTED:

MANAGER:

UNIT
#

RESIDENT
NAME

DATE
MOVED
INTO
UNIT

MOVE
IN
RENT

RENT
ADJUST.

DATE

RENT
ADJUST.

AMOUNT

CURRENT
RENT

TOTAL
HOUSE-
HOLD
INCOME

# IN
HOUSE-
HOLD

#
BDRMS

INCOME
LEVEL
(EL/VL)

73 EXHIBIT “G”

DECLARATION OF CONDITIONS AND RESTRICTIONS

REQUESTED BY AND
WHEN RECORDED MAIL TO:

CITY OF SIMI VALLEY
Attn: City Clerk
2929 Tapo Canyon Road
Simi Valley, CA 93063

SPACE ABOVE FOR RECORDER'S USE ONLY

The Undersigned declares that this document is
recorded for the benefit of the City of Simi Valley and therefore is exempt from the payment of a recording
fee pursuant to Government Code Section 6103 and
27383.

APNs: 618-0-160-145
______________________________________________________________________

DECLARATION OF CONDITIONS AND RESTRICTIONS

ON THE TRANSFER OF TITLE OR INTEREST IN REAL PROPERTY

TAPO STREET APARTMENTS
(Affordable Housing Land Consultants LLC)

The land referred to is situated in the City of Simi Valley, County of Ventura, State of California, and more particularly described in Exhibit A attached hereto and incorporated herein.

Notice is hereby given that the Project and Project Site described herein is conditioned and the transfer of title and/or interest restricted by the City of Simi Valley (“City”) as set forth in that document entitled Affordable Housing Agreement (AHA -2025-0002) (the "Agreement"), recorded in the Official Records of the Office of the County Recorder, County of Ventura, State of California, which is hereby incorporated by reference herein.

Other than in connection with Sections 13.04 and 16.20 of the Agreement, said restrictions expressly prohibit the transfer of title, assignment of rights, or delegation of duties without the express written consent of the City. Said consent must be conditioned upon the City's receipt of written evidence from the Buyer/Transferee at least 30 days before said consent that he/she has been fully informed of the terms of the Agreement and the benefits/burdens conferred therein and agrees to assume all of the dut ies and obligations, as well as the rights and benefits that the existing Owner/Seller enjoys under the terms of the Agreement.

Said restrictions further require the following:
74 1. The Owner/Seller must give at least fifteen (15) days’ notice to City before any proposed transfer to a successor or assign. The assignee or successor must agree in writing to assume on behalf of itself and its successors and assigns, all the duties and obligations of the Owner under this Agreement, and any purported assignment will not be valid without such a written agreement. Said notice must be personally delivered or sent by certified mail, return receipt requested, to:

City of Simi Valley
Attn: Environmental Services Director
2929 Tapo Canyon Road
Simi Valley, CA 93063

As a condition precedent to the opening of escrow, the Owner, designated agent(s) of the Owners, and the escrow officer each have an affirmative duty to fully disclose the terms of the Agreement to each Buyer. Escrow may open only upon receipt of the Buyer 's signed and dated statement acknowledging receipt of a copy of the Agreement.

ANY ATTEMPT TO TRANSFER TITLE OR ANY INTEREST IN THE PROJECT DURING

THE TERM OF THE AGREEMENT IN VIOLATION OF SAID AGREEMENT AND THIS

DECLARATION, MUST CAUSE SAID TRANSFER TO BE VOIDABLE AT THE ELECTION OF THE CITY.

NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, THE

RESTRICTIONS AND OBLIGATIONS SET FORTH IN THIS DECLARATION OF

CONDITIONS AND RESTRICTIONS SHALL NOT APPLY TO THE TRANSFERS SET FORTH IN SECTIONS 13.04 and 16.20 OF THE AGREEMENT.

City of Simi Valley Affordable Housing Land Consultants, LLC A Municipal Corporation a California limited liability company, Company its: Managing Member

Samantha C. Argabrite, City Manager By:

Dated: Dated:

75 EXHIBIT "A"