Attachment 2-Exhibit A_First Amendment to DDLA — Union City City Council, October 28, 2025

EXHIBIT A

FIRST AMENDMENT TO

DISPOSITION, DEVELOPMENT, AND LOAN AGREEMENT
(Lazuli Landing)
This First Amendment to Disposition, Development, and Loan Agreement (the "First Amendment") is entered into as of _______________, 2025, by and between the City of Union City, a California municipal corporation (the "City"), the City of Union City, as successor to the housing functions of the Community Redevelopment Agency of the City of Union City (“Housing Successor Agency”), and MP Lazuli Landing Associates, L.P., a California limited partnership (the "Developer").

RECITALS
A. City and Developer entered into a Disposition, Development, and Loan Agreement dated as of July 28, 2020 (the " DDLA"). The DDLA provides for the City to ground lease to Developer certain undeveloped real property bounded by Mission Boulevard, D Street, E Street and 2nd Street, in the City of Union City (the “Property”), and for Developer to develop an eighty-one unit affordable multifamily rental housing development thereon (the “Affordable Housing Improvements”), together with approximately 6,000 square feet of ground floor office space (the “Community Space Improvements”) (together, the “Development”).

B. Pursuant to the DDLA, City has made a loan to Developer in the original principal amount of Five Million Thirty-Four Thousand Nine Hundred Twenty-Four Dollars ($5,034,924) (the “City Loan”). A portion of the City Loan has been disbursed by City to and on behalf of Developer and used for predevelopment expenses related to the Affordable Housing Improvements. Developer has executed and delivered to City a Promissory Note in the original principal amount of the City Loan, dated July 28, 2020 (“Promissory Note”). The Parties now desire to reduce the amount of the City Loan to Four Million Three Hundred Fifty-Five Thousand Six Hundred Thirteen Dollars ($4,355,613).

C. Pursuant to the DDLA, City has agreed to make a grant to the grantee designated by Developer in the amount of One Million Eight Hundred Thousand Dollars ($1,800,000), to be used for a portion of the costs of construction and development of the Community Improvements (the “City Grant”). The Parties now desire for Housing Successor Agency to make an additional grant to the designee of Developer (the “Grantee”), in the amount of One Million One Hundred Thirty-Five Thousand Six Hundred Sixty-Two Dollars ($1,135,662), from the proceeds of the Housing Successor Agency’s housing bonds (the “Housing Successor Agency Grant”). The Housing Successor Agency Grant will be used by the Grantee to provide a loan to Developer for a portion of the costs of construction and development of the Affordable Housing Improvements. The obligation of the City to make the City Grant in the amount of One Million Eight Hundred Thousand Dollars ($1,800,000) will remain in effect without modification.

D. The Parties desire to make such other modifications to the DDLA as are necessary to carry out and implement the Development.

EXHIBIT A
NOW, THEREFORE, City, Housing Successor Agency and Developer hereby agree as follows:

1. City Loan.
a. The amount of the City Loan, as set forth in Sections 1.1(h) and 4.1 of the DDLA, is hereby revised to Four Million Three Hundred Fifty-Five Thousand Six Hundred Thirteen Dollars ($4,355,613).
b. Concurrently with this First Amendment, the Developer shall execute and deliver to City a First Amendment to City Loan Promissory Note in the form attached hereto as Exhibit F-1.
c. The amount of the City Loan as set forth in the Deed of Trust shall be revised to the amount set forth in paragraph (a) of this Section 1.

2. Housing Successor Agency Grant. The following new Section 4.13 is hereby added to the agreement:
“Section 4.13. Housing Successor Agency Grant. Successor Agency hereby agrees to grant to the grantee designated by the Developer the sum of One Million One Hundred Thirty-Five Thousand Six Hundred Sixty-Two Dollars ($1,135,662), from the proceeds of the Housing Successor Agency’s housing bonds (“Housing Successor Agency Grant”). The Housing Successor Agency Grant funds shall be used by the Grantee to provide a loan to the Developer to be used for a portion of the costs of construction of the Affordable Housing Improvements, in accordance with the Scope of Development. The Housing Successor Agency Grant shall be disbursed in accordance with the Final Financing Plan.”

3. Revised Schedule of Performance. The Schedule of Performance attached to the DDLA as Exhibit B is hereby replaced and superseded by the Revised Schedule of Performance attached hereto as Exhibit B-1.

4. Revised Scope of Development. The Scope of Development attached to the DDLA as Exhibit C is hereby replaced and superseded by the Revised Scope of Development attached hereto as Exhibit C-1.

5. Revised Financing Plan The Financing Plan attached to the DDLA as Exhibit E is hereby replaced and superseded by the Final Financing Plan attached hereto as Exhibit E-1.

6. Revised City Regulatory Agreement. The City Regulatory Agreement attached to the DDLA as Exhibit H is hereby replaced and superseded by the Revised City Regulatory Agreement attached hereto as Exhibit H-1.

EXHIBIT A

7. No Other Amendments. Except as amended by this First Amendment, the DDLA shall continue unmodified and in full force and effect. All terms not separately defined herein shall have the meanings as defined in the DDLA.

EXHIBIT A

EXHIBIT A
IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be duly executed as of the date set forth above.

DEVELOPER:

MP Lazuli Landing Associates, L.P., a
California limited liability company
By: MP Lazuli Landing LLC
a California limited liability company,
its general partner
By: MidPen Housing Corporation,
a California nonprofit public benefit
corporation,
its sole member/manager
By:
____________________________
Abigail Goldware Potluri,
Assistant Secretary

EXHIBIT A

EXHIBIT A
CITY:

City of Union City, a California municipal
corporation
By: _____________________________
Joan Malloy, City Manager
Attest:

By: _____________________________
Thai Nam Pham, City Clerk
Approved as to Form:

By: _____________________________
Kristopher Kokotaylo, City Attorney
HOUSING SUCCESSOR AGENCY:

City of Union City, as successor to the housing
functions of the Community Redevelopment
Agency of the City of Union City
By: _____________________________
Joan Malloy, City Manager
Attest:

By: _____________________________
Thai Nam Pham, City Clerk
Approved as to Form:

By: _____________________________
Kristopher Kokotaylo, City Attorney

EXHIBIT A

EXHIBIT A
EXHIBIT “B-1”

SCHEDULE OF PERFORMANCE
(REVISED OCTOBER 2025)
This Schedule of Performance summarizes the schedule for various activities under the Disposition, Development, and Loan Agreement (the "Agreement") to which this exhibit is attached. The description of items in this Schedule of Performance is meant to be descriptive only, and shall not be deemed to modify in any way the provisions of the Agreement to which such items relate. Section references herein to the Agreement are intended merely as an aid in relating this Schedule of Performance to other provisions of the Agreement and shall not be deemed to have any substantive effect. As provided in Section 2.1 of this Agreement, this Schedule of Performance may be modified by Operating Memoranda executed in accordance with Section 9.15 of this Agreement.

Action Date

1. Title Report. City shall provide
Developer an updated Title Report.
[§2.7]
Completed

2. Developer Deposit. Return of
Deposit to Developer. [§2.5]
Completed

3. Developer Secures Financing.

Developer shall submit applications for
financing for Development including to
the County of Alameda and State
Department of Housing and
Community Development. Completed

4. Application – Tax Credits (First
Application). Developer shall submit
an application to TCAC for a
preliminary reservation of 4% tax
credits. [§2.4]
Completed

5. Application – Tax Credits
(Subsequent Applications). Developer
shall submit a second and subsequent
applications to TCAC for a preliminary
reservation of 4% tax credits if the first
application is unsuccessful. [§2.4]
Completed

EXHIBIT A
Action Date

6. Submission – Financing Plan.

Developer shall prepare and submit
the Final Financing Plan for City
approval. [§2.3]
[Completed]

7. Approval – Financing Plan. The
City shall approve or disapprove the
proposed Final Financing Plan. [§2.3]
[Completed]

8. Submission of Construction Plans.

Developer shall submit Construction
Plans to the City for approval. [§2.8]
[Completed]

9. Closing. City shall ground lease
the Property to Developer. [§3.4; 3.5]
Upon satisfaction or waiver of
conditions set forth in Section 3.4 and

3.5, but in no event later than (i)
December 31, 2025, with a one-year
extension to be permitted if approved
by the City Manager or his or her
designee, and (ii) the latest date
permitted under the Surplus Land Act,
Government Code §54220, et seq.

10. Commencement of Construction.

Developer shall obtain a building
permit and commence construction of
the Development. [§5.2]
Within three hundred sixty-five (365)
days of receipt of tax credit allocation
from TCAC.

11. Completion of Construction.

Developer shall complete construction
of the Development. [§5.3]
Within 24 months after
commencement.

12. Progress Reports. Developer
shall provide quarterly progress
reports to the City. [§5.6]
Until Development is fully leased-up.

EXHIBIT A

EXHIBIT A
EXHIBIT C-1

SCOPE OF DEVELOPMENT
(REVISED OCTOBER 2025)
The following describes the Lazuli Landing development (“Project”) proposed by MidPen Housing Corporation (“MidPen”). While this summary presents the program currently envisioned for the proposed development, it is understood that modifications may be made with mutual agreement between MidPen and City of Union City (“City”).

1. Proposed Onsite & Offsite Improvements
The Lazuli Landing project site is a 1.6 acre vacant site, currently owned by the City, and the project site is bounded by Mission Boulevard, 2nd Street, D Street, and E Street. On this vacant site, MidPen shall construct a mixed-use development with construction of 81 total new units (including 1 onsite manager's unit that is not subject to affordability or occupancy restrictions) and approximately 6,000 square feet of ground floor office space for sublease to the City.

The Project shall include 81 units and shall receive a density bonus pursuant to state law.

The Project will include 21 one-bedroom units, 37 two-bedroom units, and 23 threebedroom units, subject to City approval. Due to funding source requirements, the proposed development will be required to have a certain percentage of larger bedroom types, including the two and three bedroom units, which may be revised with mutual approval of the Parties. The unit mix shall be as follows:

Overall Unit Mix:
1 bedroom 21 units
2 bedroom 37 units
3 bedroom 23 units
TOTAL UNITS 81 units
The approximate residential parking ratio will be 1.185:1. Developer shall underground all existing overhead utilities, which are located along the street frontage of 2nd Street, D Street, and E Street. Developer shall comply with the requirements of local utility agencies, such as Alameda County Water District (ACWD) and Union Sanitary District (USD), with respect to offsite improvement work to service the Project.

2. Ground Floor Office Space for City.

The Project shall include approximately 6,000 square feet of ground floor office space suitable for City and nonprofit, governmental, or community organization use in the building ("Community Space"). MidPen will construct and develop the commercial shell as well as the tenant improvements ("TIs") for the Community Space. The TIs shall be suitable for office space for staff, meeting space to meet with clients, amenities to support clients, including limited food pantry storage, clothes washer and dryer machine, and

EXHIBIT A
showers. 9 onsite parking spaces enclosed within the Project parking garage will be made available exclusively to City as part of the leased Community Space.

3. Resident Amenities and Open Space.

The Project shall include various indoor and outdoor amenities available to residents living at the Property, including a community room, playground, laundry room, bicycle storage room, office with small conference room, and outdoor seating with a BBQ area.

The Project will include an office for MidPen Property Management and Services for staff working at the property and to meet with residents.

4. Tentative and Final Parcel Map
MidPen will prepare a tentative and final parcel map for the Project for the approval of the City, to merge the existing multiple parcels.

EXHIBIT A

EXHIBIT A
EXHIBIT “E-1”

FINAL FINANCING PLAN
Final Financing Plan Narrative
I. Construction Financing: $ 86,953,173

1. Tax-Exempt and Taxable Construction Loan: $36,681,460 The loan term is proposed to be 29 months with 6.33% interest rate. The loan will be repaid from syndication proceeds and the permanent bank loan.

2. Alameda County A1 Regional Bond Allocation Funds: $4,453,899 The Regional and City Base Allocation are proposed to be available during construction and to roll over into permanent financing. The loan terms for Regional and City Base Allocation are currently proposed to be 3% interest, 55 years, and payments from prorata share of 75% of the residual receipts.

3. Alameda County A1 City Base Allocation Funds: $8,787,121 The City of Union City committed its City Base Allocation in the amount shown above.

The Regional and City Base Allocation are proposed to be available during construction and to roll over into permanent financing. The loan terms for Regional and City Base Allocation are currently proposed to be 3% interest, 55 years, payments from prorata share of 75% of the residual receipts.

4. City of Union City Housing Funds: $4,355,613
The City of Union City committed funds in the amount shown above. The City loan is to be available during construction (with a portion available during predevelopment) and to roll into permanent financing. The loan terms are 0% interest, 55 years, with payments from pro rata share of residual receipts.

5. GP Loan for City of Union City Funds for YFS and Centro de Servicios Office Development ($1,800,000) and City Housing Bond Proceeds ($1,135,662):
$2,935,662
The City of Union City is granting in the amount shown above to MidPen for the commercial office development and residential development. MidPen is to loan the project the amount shown above. The loan terms are 0% interest, 55 years, with deferred payment.

6. Housing Trust Silicon Valley (HTSV) Apple Construction Loan: $2,887,000

EXHIBIT A
HTSV has committed the above-mentioned funds. The loan terms proposed are 3% interest and 29 months and to roll into permanent financing at 2% with repayment.

7. California Department of Development Services (DDS): $1,500,000 State DDS has committed the above referenced funds. The loan terms proposed are 3% interest and to roll into permanent financing with deferred payment.

8. MidPen Construction Loan: $10,000,000
MidPen has committed the above referenced construction loan. The loan terms proposed are 0% interest and for repayment to occur at permanent loan conversion.

9. Federal Home Loan Bank San Francisco Affordable Housing Program (FHLBSF AHP):
$2,000,000
FHLBSF awarded the above referenced funds from AHP. The loan terms proposed are 0% interest, 55 years, with deferred payment.

10.Deferred Developer Fee: $722,247
MidPen has committed to defer its developer fee in the above referenced amount. To the extent there is net cash flow from year to year, this fee will be repaid as a priority payment from net cash flow.

11.LP Equity (Tax Credit Investor Proceeds): $4,105,542 This 4% tax credit project is expected to generate Limited Partner (LP) tax credit equity proceeds in the above amount at construction closing.

12.General Partner (GP) Equity (Tax Credit Source): $ 8,980,980 As allowed by the California Tax Credit Allocation Committee, earned developer fee in excess of the developer fee cap must be contributed back to the project in the form of General Partner (GP) equity or deferred developer fee. This project is proposing to contribute in the form of GP equity.

II. Permanent Financing: $91,177,945

1. Housing Trust Silicon Valley (HTSV) Apple Construction Loan Perm Loan:
$2,887,000

EXHIBIT A
This perm loan will be serviced from net operating income. The proposed loan term is

17.6 years with a 17.6 year amortization and 2% interest rate.

2. State Housing and Community Development (HCD) Department – Affordable Housing and Sustainable Communities: $13,500,000
HCD awarded the project with the above referenced funds. The project is proposing to apply for the above-mentioned funds from State HCD. The proposed loan terms are currently 3% simple interest, 55 years, and payments from prorata share of 75% of the residual receipts with other soft loan lenders.

3. Alameda County A1 Regional Bond Allocation Funds: $4,453,899 See above.

4. Alameda County A1 City Base Allocation Funds: $8,787,121 See above.

5. City of Union City Housing Funds: $4,355,613
The City of Union City committed funds in the amount shown above. The City loan is to be available during construction (with a portion available during predevelopment) and to roll into permanent financing. The loan terms are 0% interest, 55 years, with payments from pro rata share of residual receipts.

6. GP Loan for City of Union City Funds for YFS and Centro de Servicios Office Development ($1,800,000) and City Housing Bond Proceeds ($1,135,662):
$2,935,662
See above.

8. Federal Home Loan Bank San Francisco Affordable Housing Program (FHLBSF AHP):
$2,000,000
FHLBSF awarded the above referenced funds from AHP. The loan terms proposed are 0% interest, 55 years, with deferred payment.

9. Deferred Developer Fee: $722,247

EXHIBIT A
MidPen has committed to defer its developer fee in the above referenced amount. To the extent there is net cash flow from year to year, this fee will be repaid as a priority payment from net cash flow.

10.LP Equity (Tax Credit Investor Proceeds): $ 41,055,423 This 4% tax credit project is expected to generate Limited Partner (LP) tax credit equity proceeds in the above amount at construction closing.

11.General Partner (GP) Equity (Tax Credit Source): $ 8,980,980 As allowed by the California Tax Credit Allocation Committee, earned developer fee in excess of the developer fee cap must be contributed back to the project in the form of General Partner (GP) equity or deferred developer fee. This project is proposing to contribute in the form of GP equity.

IV. Asset Management Fees and Partnership Management Fees:

An Asset Management Fee is a required fee paid to the equity investor committing tax credit equity to this project. This fee is paid to the equity investor for overhead expenses associated with tax credit reporting requirements. To the extent there is available cash flow, a Partnership Management fee is a fee paid to the limited partnership for overhead expenses associated with the administrative management and maintenance of the limited partnership. Administrative management includes staff time associated with complying with ongoing and required lender and investor reporting requirements.

The Asset Management and Partnership and fees are $7,500 and $33,000 and respectively with an escalator. Per the current Alameda County underwriting requirements, these fees are capped at $25,000 total per year, with no escalator.

However, the County can adopt new fee caps per State HCD limits and MidPen may request to increase these fees accordingly such that these fees are consistent with Alameda County underwriting requirements and industry standards.

V. Developer Fee:

The total developer fee in tax credit eligible basis is $10,728,347. Of this amount, $1,025,120 will be paid upfront as project milestones are achieved (“Upfront Developer Fee”) including permanent financing conversion. The remaining $9,703,227 is proposed to be contributed to the project as GP Equity. In the event that any portion of the Upfront Developer Fee is deferred during the construction period, that portion will be repaid as a priority payment from net cash flow.

The Upfront Developer Fee is a one-time fee paid to MidPen in the amount of $1,025,120, which will pay for overhead and staff time costs associated with developing the project.

EXHIBIT A
The Upfront Developer Fee amount will be in conformance with the fee limit imposed by the California Tax Credit Allocation Committee.

EXHIBIT A

EXHIBIT A
Permanent Sources Uses
HTSV Apple Loan $ 2,887,000.00 Land $ 99.00
HCD AHSC $ 13,500,000.00
County Measure A1 Bond $ 4,453,899.00 Other Acquisition Costs $ 170,000.00 City Base Measure A1 Bond $ 8,787,121.00
Site Work and Structures
(including commercial) $ 56,415,397.00
City of Union City - Housing Fund Loan $ 4,355,613.00
Overhead & Profit & Insurance &
Bond $ 2,723,908.00
GP Loan - City Centro & Youth and
Family Services $ 2,935,662.00 Owner Contingency $ 2,934,148.00 State DDS Loan $ 1,500,000.00 Architecture & Engineering $ 4,679,995.00 FHLBSF AHP $ 2,000,000.00 Construction Loan Interest $ 2,892,354.00 Deferred Developer Fee $ 722,247.00 Permanent Financing $ 150,000.00 Capital Contributions Title & Legal Fees $ 255,000.00
General Partner (Developer Fee) $ 8,980,980.00 Capitalized Reserves $ 2,651,601.00 Limited Partners $ 41,055,423.00 Permit and Fees $ 4,772,240.00 Other Soft Costs $ 2,804,856.00
Developer Fee $ 10,728,347.00
Total $ 91,177,945.00 Total $ 91,177,945.00
1 EXHIBIT “F-1”

FIRST AMENDMENT TO PROMISSORY NOTE
(Lazuli Landing)
THIS FIRST AMENDMENT TO PROMISSORY NOTE (this “Amendment”), is entered into as of _______________, 2025, by and between MP LAZULI LANDING ASSOCIATES, L.P., a California limited partnership ("Borrower"), and the CITY OF UNION CITY, a California municipal corporation ("Holder). Borrower and Holder are collectively referred to herein as the “Parties.”

RECITALS
A. MidPen Housing Corporation and Holder entered into a Disposition, Development and Loan Agreement dated July 28, 2020 (the “DDLA”). The DDLA provides for the City to ground lease to Borrower certain undeveloped real property in the City of Union City, and for Borrower to develop an affordable multifamily rental housing development and other improvements thereon.

B. The DDLA provides for Holder to loan to Borrower Five Million Thirty-Four Thousand Nine Hundred Twenty-Four Dollars ($5,034,924) (the “City Loan”). A portion of the City Loan has been disbursed by City to and on behalf of Borrower and used for predevelopment expenses related to the affordable housing improvements. Pursuant to the DDLA, Borrower executed a “Promissory Note” dated as of July 28, 2020, which memorializes Borrower’s obligation to repay the City Loan to Holder.

C. Borrower and MidPen Housing Corporation have entered into a First Amendment to Disposition, Development and Loan Agreement dated _________________, 2025. Pursuant to the terms of the First Amendment to Disposition, Development and Loan Agreement, MidPen Housing Corporation and Holder have agreed to reduce the amount of the City Loan to Four Million Three Hundred Fifty-Five Thousand Six Hundred Thirteen Dollars ($4,355,613).

MidPen Housing Corporation has assigned its rights and obligations under the Disposition, Development and Loan Agreement to Borrower.

NOW THEREFORE, the Parties agree to amend the Promissory Note as follows:

1. The original principal balance of the Note, as set forth in Section 1 of the Promissory Note and the first paragraph thereof, is hereby amended from Five Million ThirtyFour Thousand Nine Hundred Twenty-Four Dollars ($5,034,924) to reduce the amount of the City Loan to Four Million Three Hundred Fifty-Five Thousand Six Hundred Thirteen Dollars ($4,355,613).

2. All other provisions of the Promissory Note shall remain in full force and effect. [Signatures on Next Page]
1 2
IN WITNESS WHEREOF, Holder and Borrower have executed this Amendment as of the date set forth in the first paragraph.

BORROWER:

MP Lazuli Landing Associates, L.P., a California
limited liability company
By: MP Lazuli Landing LLC
a California limited liability company,
its general partner
By: MidPen Housing Corporation,
a California nonprofit public benefit corporation,
its sole member/manager
By: ____________________________
Abigail Goldware Potluri,
Assistant Secretary
Agreed and Acknowledged by Holder:

CITY OF UNION CITY,
a California municipal corporation
By: ____________________________
Joan Malloy, City Manager
Attest:

By: _____________________________
Thai Nam Pham, City Clerk
Approved as to Form:

By: _____________________________
Kristopher Kokotaylo, City Attorney
2 3
EXHIBIT “H-1”

REVISED CITY REGULATORY AGREEMENT

REGULATORY AGREEMENT AND

DECLARATION OF RESTRICTIVE COVENANTS
(Lazuli Landing)
This Regulatory Agreement and Declaration of Restrictive Covenants (the "Agreement") is made and entered into as of _______, 2025, by and between the City of Union City, a California municipal corporation (the "City"), and MP Lazuli Landing Associates, L.P., a California limited partnership (the "Owner").

RECITALS
A. Owner is the owner of a leasehold interest in that certain property bounded by Mission Boulevard, D Street, E Street and 2nd Street in the City of Union City, as more particularly described in Exhibit A (the "Property"), pursuant to that certain Ground Lease dated as of ____________, 2025 (as modified from time to time, the “Ground Lease”), a memorandum of which shall be recorded in the official records of Alameda County, California, concurrently herewith. Owner intends to construct an eighty-one (81) unit multifamily rental housing development on the Property for rental to very low and low income households, along with one (1) manager's unit. Together the Property and its improvements are the "Development".

B. City has entered into a Disposition, Development and Loan Agreement with Owner dated as of July 28, 2020, as amended by the First Amendment to Disposition, Development and Loan Agreement of even date herewith (as amended, the "DDLA"), pursuant to which the City agreed to ground lease the Property to the Owner and is lending to Owner Four Million Three Hundred Fifty-Five Thousand Six Hundred Thirteen Dollars ($4,355,613) ("City Loan") to assist with the construction of the Development, and to grant to MidPen Housing Corporation, a California nonprofit public benefit corporation, One Million Eight Hundred Thousand Dollars ($1,800,000) (the "City Grant") to be used by MidPen Housing Corporation to make a loan to Owner for the costs of construction and installation of tenant improvements to the "Community Space" to be constructed within the Development. The City, in its capacity as the successor to the housing functions of the Community Redevelopment Agency of the City of Union City, is making an additional grant in the amount of One Million One Hundred Thirty-Five Thousand Six Hundred Sixty-Two Dollars ($1,135,662) (the “Housing Successor Agency Grant”), to be used for a portion of the costs of construction and development of the Affordable Housing Improvements.

C. The City acquired the Property as the housing successor to the former Union City Redevelopment Agency. The Property was acquired by the former Redevelopment Agency with the proceeds of tax exempt tax allocation bonds.

D. The City has agreed to ground lease the Property to the Owner and to make the City Loan, the City Grant and the Housing Successor Agency Grant on the condition that the Owner construct, maintain and operate the Development in accordance with restrictions set forth in this Regulatory Agreement and in related documents including the DDLA. The "Community Space" to be constructed within the Development (as defined in the DDLA) is not intended to be regulated by this Regulatory Agreement.
4 E. The Owner applied for and received a density bonus pursuant to the State Density Bonus Law (Government Code Sections 65915-65918) ("Density Bonus Law"). The Density Bonus Law requires the City to ensure and the Owner to agree to continued affordability of the Units subject to the density bonus. This Agreement satisfies the requirements and obligations of the Density Bonus Law.

F. In consideration for the ground lease of the Property and receipt of the City Loan at an interest rate substantially below the market rate, Owner agrees to observe all of the terms and conditions set forth below.

THEREFORE, City and Owner hereby agree as follows.

ARTICLE 1.

DEFINITIONS

1.1 Definitions. When used in this Agreement, the following terms shall have the respective meanings assigned to them in this Article 1. (a) "Actual Household Size" shall mean the actual number of persons in the applicable household.
(b) "Affiliate" means any person or entity directly or indirectly, through one or more intermediaries, controlling, controlled by or under common control with Owner which, if Owner is a partnership or limited liability company, shall include each of the constituent members or partners, respectively thereof. The term "control" as used in the immediately preceding sentence, means, with respect to a person that is a corporation, the right to the exercise, directly or indirectly, of more than fifty percent (50%) of the voting rights attributable to the shares of the controlled corporation, and, with respect to a person that is not a corporation, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled person.
(c) "Affordable Units" shall mean collectively the Twenty Percent Units, Thirty Percent Units, Forty Percent Units, Fifty Percent Units, and the Sixty Percent Units. (d) "Agreement" shall mean this Regulatory Agreement and Declaration of Restrictive Covenants.
(e) "Area Median Income" shall mean the median gross yearly income adjusted for Actual Household Size or Assumed Household Size as specified herein, in Alameda County, California, as published from time to time and periodically updated in Title 25, California Code of Regulations, Section 6932 (or successor provision) by HCD. In the event that such income determinations are no longer published or are not updated for a period of at least eighteen (18) months, City shall provide the Owner with other income determinations which are reasonably similar with respect to methods of calculation to those previously published by HCD. (f) "Assumed Household Size" means the household size "adjusted for family size appropriate to the unit" as such term is defined in Health & Safety Code Section 50052.5(h), used to calculate Rent.
(g) "City" shall mean the City of Union City, a California municipal corporation.
5 (h) "City Loan" shall mean all funds loaned to Owner pursuant to the DDLA. (i) "Completion Date" means the date a final certificate of occupancy, or equivalent document is issued by the City to certify that the construction of the Development is complete and the Development may be legally occupied.
(j) "DDLA" shall mean the Disposition, Development and Loan Agreement entered into by and between the City and Owner, dated of July 28, 2020, as amended by the First Amendment to Disposition, Development and Loan Agreement dated as of ______________, 2025.
(k) "Deed of Trust" shall mean the Deed of Trust with Assignment of Rents, Security Agreement and Fixture Filing of even date herewith by and among Owner, as Trustor, Old Republic Title Company, as trustee, and the City as beneficiary, that encumbers the Owner’s leasehold interest in the Property to secure repayment of the City Loan and Owner’s performance of the Loan Documents.
(l) "Density Bonus Units" shall mean the four (4) units that are restricted at affordable rents in compliance with the Density Bonus Law. The Density Bonus Units may be either Twenty Percent Units or Fifty Percent Units.
(m) "Development" shall mean the Property and the eighty-one (81) units to be developed on the Property, as well as any additional improvements and all landscaping, roads and parking spaces existing thereon, as the same may from time to time exist. (n) "Fifteen Year Compliance Period" means the fifteen (15) year compliance period as described in Section 42(i)(1) of the Internal Revenue Code of 1986, as amended. (o) "Fifty Percent Household" shall mean a household with an Adjusted Income which does not exceed fifty percent (50%) of Area Median Income. (p) "Fifty Percent Units" shall mean the Units which, pursuant to Section

2.1(d) below, are required to be occupied by Fifty Percent Households. (q) "Forty Percent Household" shall mean a household with an Adjusted Income which does not exceed forty percent (40%) of Area Median Income. (r) "Forty Percent Units" shall mean the Units which, pursuant to Section

2.1(c) below, are required to be occupied by Forty Percent Households. (s) "Household Income" shall mean the total anticipated annual income of all persons in a household, as calculated in accordance with the California Tax Credit Allocation Committee rules and regulations or pursuant to a successor State housing program that utilizes a reasonably similar method of calculation of adjusted income. In the event that no such program exists, City shall provide the Owner with a reasonably similar method of calculation of gross income as provided in 25 California Code of Regulations Section 6914. (t) "Investor Limited Partner" means Bank of America, N.A. (u) "Loan Documents" shall mean this Agreement, the DDLA, the Note, and the Deed of Trust.
(v) "Note" shall mean the promissory note from the Owner to City evidencing all or any part of the City Loan.
6 (w) "Owner" shall mean MP Lazuli Landing Associates, L.P., a California limited partnership, and its successors and assigns to the Development. (x) "Partnership Agreement" means the Agreement of Limited Partnership, dated on or about __________________, that governs the operation and organization of Owner as a California limited partnership.
(y) "Property" shall mean the real property described in Exhibit A attached hereto and incorporated herein.
(z) "Rent" shall mean the total of monthly payments by the tenants of a Unit for the following: use and occupancy of the Unit and land and associated facilities, including parking; any separately charged fees or service charges assessed by Owner which are required of all tenants, other than security deposits; the cost of an adequate level of service for utilities paid by the tenant, including garbage collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuel, but not cable or telephone service; any other interest, taxes, fees or charges for use of the land or associated facilities and assessed by a public or private entity other than Owner, and paid by the Tenant. Utility allowances may be determined by use of the utility allowance published by the local public housing authority or the California Utility Allowance Calculator ("CUAC") model allowed by the California Tax Credit Allocation Committee regulations, if the Property qualifies.
(aa) "Sixty Percent Household" shall mean a household with an Adjusted Income which does not exceed sixty percent (60%) of Area Median Income. (bb) "Sixty Percent Units" shall mean the Units which, pursuant to Section

2.1(e) below, are required to be occupied by Sixty Percent Households. (cc) "Tenant" shall mean a household occupying a Unit.
(dd) "Term" means the term of this Regulatory Agreement which commences as of the date of this Regulatory Agreement, and shall remain in effect until the earlier of (1) the termination of the Ground Lease; or (2) the ninety-ninth (99th) anniversary of the issuance of a Certificate of Occupancy for the Development.
(ee) "Thirty Percent Household" shall mean a household with an Adjusted Income which does not exceed thirty percent (30%) of Area Median Income. (ff) "Thirty Percent Units" shall mean the Units which, pursuant to Section

2.1(b) below, are required to be occupied by Thirty Percent Households. (gg) "Twenty Percent Household" shall mean a household with an Adjusted Income which does not exceed twenty percent (20%) of Area Median Income. (hh) "Twenty Percent Units" shall mean the Units which, pursuant to Section

2.1(a) below, are required to be occupied by Twenty Percent Households. (ii) "Units" shall mean the eighty-one (81) rental units to be constructed by the Owner on the Property.

ARTICLE 2.

AFFORDABILITY COVENANTS
7 2.1 Occupancy Requirements.
(a) Twenty Percent Income Units. 17 of the Units shall be rented to and occupied by or, if vacant, available for occupancy by Twenty Percent Households. (b) Thirty Percent Income Units. 4 of the Units shall be rented to and occupied by or, if vacant, available for occupancy by Thirty Percent Households. (c) Forty Percent Income Units. 13 of the Units shall be rented to and occupied by or, if vacant, available for occupancy by Forty Percent Households. (d) Fifty Percent Income Units. 35 of the Units shall be rented to and occupied by or, if vacant, available for occupancy by Fifty Percent Households. (e) Sixty Percent Income Units. 11 of the Units shall be rented to and occupied by or, if vacant, available for occupancy by Sixty Percent Households. (f) Density Bonus Units. The four (4) Density Bonus Units may be either Twenty Percent Units or Fifty Percent Units. For avoidance of doubt, the Density Bonus Units are not in addition to the Affordable Units but rather the Affordable Units satisfy the Density Bonus Unit requirement.
(g) Manager's Unit. One (1) Unit shall be reserved for an on-site manager, and shall not be subject to affordability or occupancy restrictions. (h) Intermingling of Units. All Units shall be intermingled and of comparable quality. Tenants in all Units shall have equal access to and enjoyment of all common facilities of the Development.
(i) Disabled Persons Occupancy.
(i) Owner shall cause the Development to be operated at all times in compliance with all applicable federal, state, and local disabled persons accessibility requirements including, but not limited to the applicable provisions of: (i) the Unruh Act, (ii) the California Fair Employment and Housing Act, (iii) the United States Fair Housing Act, as amended, (iv) the Americans With Disabilities Act of 1990, and (vi) Chapters 11A and 11B of Title 24 of the California Code of Regulations, which relate to disabled persons access (collectively, the "Accessibility Requirements").
(ii) Owner shall indemnify, protect, hold harmless and defend (with counsel reasonably satisfactory to the City) the City, and its board members, officers and employees, from all suits, actions, claims, causes of action, costs, demands, judgments and liens arising out of Owner's failure to comply with the Accessibility Requirements. This obligation to indemnify survives termination of this Regulatory Agreement, repayment of the City Loan, cancellation of the Promissory Note, and the reconveyance of the Deed of Trust.

2.2 Allowable Rent.
(a) Twenty Percent Rents. Subject to the provisions of Section 2.3 below, the Rent charged to Tenants of the Twenty Percent Units, shall not exceed one-twelfth of thirty percent (30%) of twenty percent (20%) of Area Median Income, adjusted for Assumed Household Size.
8 (b) Thirty Percent Rents. Subject to the provisions of Section 2.3 below, the Rent charged to Tenants of the Twenty Percent Units, shall not exceed one-twelfth of thirty percent (30%) of thirty percent (30%) of Area Median Income, adjusted for Assumed Household Size.
(c) Forty Percent Rents. Subject to the provisions of Section 2.3 below, the Rent charged to Tenants of the Twenty Percent Units, shall not exceed one-twelfth of thirty percent (30%) of forty percent (40%) of Area Median Income, adjusted for Assumed Household Size.
(d) Fifty Percent Rents. Subject to the provisions of Section 2.3 below, the Rent charged to Tenants of the Twenty Percent Units, shall not exceed one-twelfth of thirty percent (30%) of fifty percent (50%) of Area Median Income, adjusted for Assumed Household Size.
(e) Sixty Percent Rents. Subject to the provisions of Section 2.3 below, the Rent charged to Tenants of the Twenty Percent Units, shall not exceed one-twelfth of thirty percent (30%) of sixty percent (60%) of Area Median Income, adjusted for Assumed Household Size.
(f) Compliance with TCAC Requirements. For all units other than the Density Bonus Units, during the term of any regulatory agreement associated with the provision of low income housing tax credits by the California Tax Credit Allocation Committee ("TCAC") and recorded against the Property (the "TCAC Regulatory Agreement"), Owner may use the occupancy standards, occupancy assumptions, income limits, and rent levels that are permitted by TCAC in the TCAC Regulatory Agreement, in place of such requirements imposed by this Regulatory Agreement.
(g) Compliance with Density Bonus Law. Occupancy standards, occupancy assumptions, income limits and rent levels for the Density Bonus Units shall comply with the requirements of the Density Bonus Law.

2.3 Rent Increases.
(a) Rent Amount. The initial Rent for all Units must be approved by the City prior to occupancy. The City will provide Owner with a schedule of maximum permissible Rents for the Units and the maximum monthly allowances for utilities and services ( excluding telephone) at least nine months before the expected date for receipt of a temporary certificate of occupancy and annually. The utility allowance schedule will be determined either by use of the CUAC or Housing Authority schedule. Notwithstanding the City schedule of maximum rents, Owner shall not be obligated to reduce rents for any existing tenants should maximum rents decrease, or utility allowances increase for any units other than the Density Bonus Units which must conform to the City schedule of maximum rents.
(b) Rent Increases. All Rent increases for all Units are subject to City approval. No later than sixty (60) days prior to the proposed implementation of any Rent increase affecting a Unit, Owner shall submit to the City a schedule of any proposed increase in the Rent charged for the Units. The Rent for such Units may be increased no more than once annually based upon updated rent schedules corresponding to the updated Area Median Income.

The City will disapprove a Rent increase for the Density Bonus Units if it violates the schedule of maximum permissible Rents for the Units provided to Owner by the City. The City will disapprove a Rent Increase for all non-Density Bonus Units if the Rent is greater than (i) the schedule of maximum permissible Rents for Units provided to the Owner by the City; or (ii) the 9 rent in effect immediately prior to any Rent increase, whichever is higher. Any rent increase resulting from use of the CUAC model for utility allowances shall comply with the California Tax Credit Allocation Committee limitation. Owner shall give Tenants written notice at least thirty (30) days prior to any Rent increase, following completion of the City approval process set fo1ih above. Notwithstanding the above, in no event will any annual rent increase exceed the annual rent increase allowed pursuant to Civil Code Section 1947.12, although the patties acknowledge that the Units are not subject to such restrictions pursuant to Civil Code Section 1947.12. For purposes of this Agreement, if any rent subsidy is terminated or reduced, an increase in the tenant's total monthly payment toward rent to offset the terminated or reduced rent subsidy shall not constitute a Rent Increase as long as the Rent for the Unit is not increased above the maximum allowable Rent.

2.4 Increased Income of Occupying Households.
(a) Increased Income Below Very Low Income. In the event, upon recertification of an occupant household's income, the Owner discovers that a Twenty Percent Household no longer qualifies as a Twenty Percent Household (but does qualify as a Very Low Income Household), such household's Unit shall be considered a Very Low Income Unit (and the Rent may be increased to one-twelfth (1/12th) of thirty percent (30%) of fifty percent (50%) of Area Median Income upon sixty (60) days written notice to the household) and the Owner shall rent the next available Unit to a Twenty Percent Household to comply with the requirements of Section 2.1 above.
(b) Non-Qualifying Household. If, upon recertification of a Tenant's income, the Owner determines that a Tenant has an Adjusted Income exceeding the qualifying income for Very Low Income Household, adjusted for Actual Household Size, such Tenant shall be permitted to continue to occupy the Unit at a Rent not exceeding one-twelfth of thirty percent (30%) of one hundred ten percent (110%) of Area Median Income, and the Unit shall continue to be classified as a Very Low Income Unit until the Tenant vacates the Unit, at which time the Unit shall be re-rented to a Twenty Percent Household or a Very Low Income Household, as applicable, to meet the requirements of Section 2.1 above. Notwithstanding the above, if the Owner determines that a Tenant has an Adjusted Income exceeding One Hundred Twenty Percent (120%) of Area Median Income, the Owner may elect to increase the Rent to the maximum permissible..
(c) Termination of Occupancy. Upon e1mination of occupancy of a Unit by a Tenant, such Unit shall be deemed to be continuously occupied by a household of the same income level (e.g., Twenty Percent Household or Very Low Income Household) as the initial income level of the vacating Tenant, until such Unit is reoccupied, at which time the income character of the Unit (e.g., Twenty Percent Household or Very Low Income Unit) shall be redetermined.
(d) Continued Compliance. In the event an occupant household's income increases and the rent is increased as set forth in Sections (a) and (b) above, the Unit shall continue to be classified as a Twenty Percent Unit or a Very Low Income Unit, as applicable, until such time as the Unit is either vacated by the occupant or another Unit is rented at the applicable income limit.

2.5 Lease Provisions. Owner shall include in leases for all Units provisions which authorize Owner to immediately terminate the tenancy of any household one or more of whose members has misrepresented any fact material to the household's qualification as a Twenty Percent Unit or Very Low Income Household. Each lease or rental agreement shall also provide 10 that the household is subject to annual certification in accordance with Section 3.1 below, and that, if the household's income increases above the applicable limits for a Twenty Percent Unit or Very Low Income Household, as applicable, such household's Rent may be subject to increase.

2.6 Condominium Conversion. The Owner shall not convert Development units to condominium or cooperative ownership or sell condominium or cooperative conversion rights to the Property during the Term of this Agreement.

2.7 Expiration of Regulatory Agreements. Notwithstanding the provisions of Sections 2.1 and 2.2, upon expiration of the fifty-five (55) year term of the TCAC Regulatory Agreement, the maximum household income of the Affordable Units and the corresponding Rent amounts for the Affordable Units may be increased to an amount necessary to make operation of the Development financially feasible (as defined below); provided all of the following conditions are met: (1) the maximum qualifying household income for any unit shall in no event be increased above 80% of Area Median Income adjusted for household size appropriate to the Unit, (2) the annual affordable rent for any Unit shall in no event exceed 30% of 60% of Area Median Income, as adjusted for household size appropriate to the Unit; (3) the City has approved any such rent increase based on a projected operating budget provided to the City by the Owner showing the need for the rent increase; (4) the rent increase is only applicable to the minimum number of Units and only in the amount necessary to ensure that the Development is financially feasible as shown on the operating budget submitted to the City; and (5) there shall be no displacement of existing occupants of the Units. For purposes of this section "financially feasible" shall mean that the Development generates sufficient revenue to pay all operating costs and required debt service. Prior to any such rent increase, Owner shall use diligent efforts to seek alternative funding sources that would maintain the financial feasibility of the Development at the Rents set forth in Section 2.2.

ARTICLE 3.

INCOME CERTIFICATION AND REPORTING

3.1 Income Certification. The Owner will obtain, complete and maintain on file, immediately prior to initial occupancy and annually thereafter, income certifications from each Tenant renting any of the Units (excluding the manager's Unit). The Owner shall make a good faith effort to verify that the income provided by an applicant or occupying household in an income certification is accurate by taking one or more of the following steps as a part of the verification process: (1) obtain a pay stub for the most recent pay period; (2) obtain an income tax return for the most recent tax year; (3) conduct a credit agency or similar search; (4) obtain an income verification form from the applicant's current employer; (5) obtain an income verification form from the Social Security Administration and/or the California Department of Social Services if the applicant receives assistance from either of such agencies; or (6) if the applicant is unemployed and has no such tax return, obtain another form of independent verification. Copies of tenant income certifications shall be available to City upon request.

3.2 Annual Report to City. Each year by July 1 Owner shall submit an annual report to City, in a form approved by City. The annual report shall include for each Unit covered by this Agreement, the Rent and the income and household size of the household occupying the Unit and shall have the income certifications for each Tenant, prepared pursuant to Section 3.1 above available upon request. The report shall also state the date the tenancy commenced for each rental Unit, the number of bedrooms in such Unit, and such other information as City may be required by law to obtain.
11 3.3 Additional Information. Owner shall provide any additional information reasonably requested by City. City shall have the right to examine and make copies of all books, records or other documents of Owner which pertain to any Unit.

3.4 Records.
(a) Owner shall keep and maintain at the principal place of business of the Owner set forth in Section 6.11 below, or elsewhere with the City's written consent, full, complete and appropriate books, records and accounts relating to the Development. Owner shall cause all books, records and accounts relating to its compliance with the terms, provisions, covenants and conditions of the Loan Documents to be kept and maintained in accordance with generally accepted accounting principles consistently applied, and to be consistent with requirements of this Regulatory Agreement. Owner shall cause all books, records, and accounts to be open to and available for inspection and copying by the City, its auditors or other authorized representatives at reasonable intervals during normal business hours. Owner shall cause copies of all tax returns and other reports that Owner may be required to furnish to any government agency to be open for inspection by the City at all reasonable times at the place that the books, records and accounts of Owner are kept. Owner shall preserve such records for a period of not less than five (5) years after their creation. If any litigation, claim, negotiation, audit exception, monitoring, inspection or other action relating to the use of the City Loan is pending at the end of the record retention period stated herein, then Owner shall retain the records until such action and all related issues are resolved. Such records are to include but are not limited to:
(i) Records documenting compliance with the fair housing, equal opportunity, and affirmative fair marketing requirements; (ii) Financial records; and
(iii) Records demonstrating compliance with the marketing, tenant selection, affordability, and income requirements.
(b) The City shall notify Owner of any records it deems insufficient. Owner has fifteen (15) calendar days after the receipt of such a notice to correct any deficiency in the records specified by the City in such notice, or if a period longer than fifteen (15) days is reasonably necessary to correct the deficiency, then Owner must begin to correct the deficiency within fifteen (15) days and correct the deficiency as soon as reasonably possible.

ARTICLE 4.

OPERATION OF THE DEVELOPMENT

4.1 Residential Use. The Development shall be operated only for residential use. No part of the Development shall be operated as transient housing.

4.2 Compliance with Loan Documents and Development Regulatory Agreements.

Owner shall comply with all the terms and provisions of the Loan Documents and any other regulatory requirement imposed on the Development, including but not limited to regulatory agreements associated with the Low Income Housing Tax Credits provided by the California Tax Credit Allocation Committee (the "Development Regulatory Documents"). Owner shall promptly notify the City in writing of the existence of any default under any Development Regulatory Documents and provide the City with copies of any such notice of default. 12 4.3 Property Tax Exemption. Owner shall not apply for a property tax exemption for the Property under any provision of law other than Revenue and Taxation Section 214(g) without City's prior written consent.

4.4 Taxes and Assessments. Owner shall pay all real and personal property taxes, assessments, if any, and charges and all franchise, income, employment, old age benefit, withholding, sales, and other taxes assessed against it, or payable by it, at such times and in such manner as to prevent any penalty from accruing, or any lien or charge from attaching to the Property; provided, however, that Owner shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event Owner exercises its right to contest any tax, assessment, or charge against it, Owner, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered against it, together with all costs, charges and interest.

4.5 Nondiscrimination. All of the Units shall be available for occupancy on a continuous basis to members of the general public who are income eligible. There shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin, ancestry, or disabled status in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of any Unit nor shall Owner or any person claiming under or through the Owner, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sublessees, subtenants, or vendees of any Unit or in connection with the employment of persons for the operation and management of the Development. All deeds, leases or contracts made or entered into by Owner as to the Units or the Development or portion thereof, shall contain covenants concerning discrimination as prescribed by the DDLA.

4.6 City Preference. To the extent permitted by law and consistent with the program regulations for funding sources used for the development of the Units, Owner shall give a preference in the rental of sixty-seven (67) of the Units to eligible households in which at least one member lives or works in the City. The preference stated in this section applies to the rentals of Units throughout the Term.

4.7 Section 8 Certificate Holders. The Owner will 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 housing program under Section 8 of the United States Housing Act, or its successor. The Owner shall not apply selection criteria to Section 8 certificate or voucher holders that is more burdensome than criteria applied to all other prospective tenants, nor shall the Owner apply or permit the application of management policies or lease provisions with respect to the Development which have the effect of precluding occupancy of units by such prospective tenants.

4.8 Marketing Plan. No later than six (6) months prior to the date construction of the Development is projected to be complete, Owner shall submit to the City for approval its plan for marketing the Development to income-eligible households as required by this Regulatory Agreement (the "Marketing Plan"). The Marketing Plan shall be in compliance with all applicable fair housing, equal opportunity and affirmative fair marketing laws and requirements.

Upon receipt of the Marketing Plan, the City will promptly review the Marketing Plan and shall approve or disapprove it within fifteen (15) days after receipt. If the Marketing Plan is not approved, the City shall give Owner specific reasons for such disapproval and Owner shall submit a revised Marketing Plan within fifteen (15) days of notification of the City's disapproval. 13 Owner shall follow this procedure for resubmission of a revised Marketing Plan until the Marketing Plan is approved by the City. If the Owner does not submit a revised Marketing Plan that is approved by the City at least three (3) months prior to the date construction of the Development is projected to be complete, Owner will be in default of this Regulatory Agreement.

4.9 Environmental Requirements. Owner shall comply with the environmental requirements set forth in Section 6.7 of the DDLA and Article 6 of the Deed of Trust, which are incorporated herein.

ARTICLE 5.

PROPERTY MANAGEMENT AND MAINTENANCE

5.1 Management Responsibilities. The Owner is responsible for all management functions with respect to the Development, including without limitation the selection of tenants, certification and recertification of household size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. City shall have no responsibility over management of the Development.

The Owner shall retain a professional property management company approved by City in its reasonable discretion to perform its management duties hereunder. A resident manager shall also be required.

5.2 Approval of Management Agent. The Development shall at all times be managed by an experienced management agent reasonably acceptable to City, with demonstrated ability to operate residential facilities like the Development in a manner that will provide decent, safe, and sanitary housing (as approved, the "Management Agent"). The Owner shall submit for City's approval the identity of any proposed Management Agent. The City has approved MidPen Property Manager as the Management Agent. The Owner shall also submit such additional information about the background, experience and financial condition of any proposed Management Agent as is reasonably necessary for the City to determine whether the proposed Management Agent meets the standard for a qualified Management Agent set forth above. If the proposed Management Agent meets the standard for a qualified Management Agent set forth above, City shall approve the proposed Management Agent by notifying the Owner in writing.

Unless the proposed Management Agent is disapproved by City within thirty (30) days, which disapproval shall state with reasonable specificity the basis for disapproval, it shall be deemed approved.

5.3 Performance Review. City reserves the right to conduct an annual (or more frequently, if deemed reasonably necessary by City) review of the management practices and financial status of the Development. The purpose of each periodic review will be to enable City to determine if the Development is being operated and managed in accordance with the requirements and standards of this Agreement. The Owner shall cooperate with City in such reviews.

5.4 Replacement of Management Agent. If, as a result of a periodic review, City determines in its reasonable judgement that the Development is not being operated and managed in accordance with any of the material requirements and standards of this Agreement, City shall deliver notice to Owner of its intention to cause replacement of the Management Agent, including the reasons therefor. Within fifteen (15) days of receipt by Owner of such written notice, City staff and Owner shall meet in good faith to consider methods for improving the financial and operating status of the Development. If after a reasonable period as determined by 14 City (not to exceed sixty (60) days), City determines that the Owner is not operating and managing the Development in accordance with the material requirements and standards of this Agreement, City may require replacement of the Management Agent.

If, after the above procedure, City requires in writing the replacement of the Management Agent, Owner shall promptly dismiss the then Management Agent, and shall appoint as the Management Agent a person or entity meeting the standards for a Management Agent set forth in Section 5.2 above and approved by City pursuant to Section 5.2 above.

Any contract for the operation or management of the Development entered into by Owner shall provide that the contract can be terminated as set forth above. Failure to remove the Management Agent in accordance with the provisions of this Section shall constitute default under this Agreement, and City may enforce this provision through legal proceedings as specified in Section 6.5.

5.5 Management Policies. The Owner shall submit its written management plan with respect to the Development to City for its review, and shall amend such policies in any way necessary to ensure that such policies comply with the provisions of this Agreement.

5.6 Property Maintenance. The Owner agrees, for the entire Term of this Agreement, to maintain or cause to be maintained all interior and exterior improvements, including landscaping, on the Property in good condition and repair (and, as to landscaping, in a healthy condition), reasonable wear and tear excepted, and in accordance with all applicable laws, rules, ordinances, orders and regulations of all federal, state, county, municipal, and other governmental agencies and bodies having or claiming jurisdiction and all their respective departments, bureaus, and officials.

In the event that the Owner breaches any of the covenants contained in this section and such default continues for a period of seven (7) days after written notice from City with respect to graffiti, debris, waste material, and general maintenance or thirty (30) days after written notice from City with respect to landscaping and building improvements, then City, in addition to whatever other remedy it may have at law or in equity, shall have the right to enter upon the Property and perform or cause to be performed all such acts and work necessary to cure the default. Pursuant to such right of entry, City shall be permitted (but is not required) to enter upon the Property and perform all acts and work necessary to protect, maintain, and preserve the improvements and landscaped areas on the Property, and to attach a lien on the Property, or to assess the Property, in the amount of the expenditures arising from such acts and work of protection, maintenance, and preservation by City and/or costs of such cure, which amount shall be promptly paid by the Owner to City upon demand.

Section 5.7 Social Services. Owner shall provide a variety of social services at the Development. Such social services are subject to the prior written approval of the City, in its reasonable discretion. Owner shall use its best efforts to create a comprehensive social service program that is targeted to the needs of the residents of the Development which may include, but is not limited to, the following services: after-school programs of an ongoing nature for school age children, financial planning skills, job coaching, and/or the availability of a bona fide services coordinator to the tenants. Owner shall ensure that all personnel providing or coordinating all social services shall be adequately trained and counseled, including with respect to the appropriate means and methods of communicating and interacting with residents. Any substantive change in the scope, amount, or type of social services to be provided at the Property shall be subject to prior reasonable approval of City and approval shall not be unreasonably withheld.
15 ARTICLE 6.

MISCELLANEOUS

6.1 Transfers.
(a) For purposes of this Agreement, "Transfer" means any sale, assignment, or transfer, whether voluntary or involuntary, of: (i) any rights and/or duties under the Loan Documents; and/or (ii) any interest in the Development, including (but not limited to) a fee simple interest, a joint tenancy interest, a life estate, a partnership interest, a leasehold interest, a security interest, or an interest evidenced by a land contract by which possession of the Development is transferred and Owner retains title. The term "Transfer" excludes the leasing of any single unit in the Development to an occupant in compliance with this Regulatory Agreement. The City Manager is authorized to execute assignment and assumption agreements on behalf of the City to implement any approved Transfer. (b) Except as otherwise permitted in this Section 6.1, no Transfer is permitted without the prior written consent of the City, which the City may withhold in its sole discretion.

The City Combined Loan will automatically accelerate and be due in full upon any Transfer made without the prior written consent of the City.
(c) The City hereby approves the admission of the Investor Limited Partner to Owner as limited partner. The City hereby approves future Transfers of the limited partner interest of Owner provided that Owner, MidPen Housing Corporation, or a non-profit affiliate of MidPen Housing Corporation, remains as the managing general partner of the partnership. (d) The City hereby approves a Transfer of the Property from Owner to MidPen Housing Corporation, or a non-profit affiliate of MidPen Housing Corporation, and an assumption of the City Loan by such transferee at or prior to the end of the Fifteen Year Compliance Period, provided that: (i) such Transfer is pursuant to an option or right of first refusal agreement referenced in the Partnership Agreement, (ii) the assignment and assumption agreement evidencing such Transfer requires the transferee to expressly assume the obligations of Owner under the Loan Documents, and (iii) the City is provided executed copies of all documents evidencing the Transfer.
(e) The City hereby approves the purchase of the Investor Limited Partner interest by MidPen Housing Corporation, or a non-profit affiliate of MidPen Housing Corporation at or prior to the end of the Fifteen Year Compliance Period, provided that (i) such Transfer is pursuant to an option or right of first refusal agreement referenced in the Partnership Agreement, and (ii) the City is provided executed copies of all documents evidencing the Transfer.
(f) In the event the general partner of Owner is removed by the limited partner of Owner for cause following default under the Partnership Agreement, the City hereby approves the Transfer of the general partner interest to (i) a 501(c)(3) tax exempt nonprofit corporation or other entity with a 501(c)(3) tax exempt nonprofit corporation member or partner, that is selected by the Investor Limited Partner and approved by the City, and (ii) the Investor Limited Partner or an affiliate thereof, but only for a period not to exceed ninety (90) days from the date of removal of the general partner, during which time such entity shall diligently seek a replacement general partner meeting the requirements of subsection (i) above. 16 (g) The City hereby approves the grant of the security interests in the Development for financing approved in the Final Financing Plan as such term is defined in Section 1.1(x) of the DDLA.

6.2 Term. The provisions of this Agreement shall apply to the Property for the entire Term even if the entire City Loan is paid in full prior to the end of the Term; provided, however, that the provisions of Section 5.6 of the Agreement shall run with the Property and shall remain in effect in perpetuity. This Agreement shall bind any successor, heir or assign of Owner, whether a change in interest occurs voluntarily or involuntarily, by operation of law or otherwise, except as expressly released by City. City makes the City Loan on the condition, and in consideration of, this provision, and would not do so otherwise.

6.3 Notice of Expiration of Term.
(a) At least six (6) months prior to the expiration of the Term, Owner shall provide by first-class mail, postage prepaid, a notice to all Tenants containing (a) the anticipated date of the expiration of the Term, (b) any anticipated increase in Rent upon the expiration of the Term, (c) a statement that a copy of such notice will be sent to City, and (d) a statement that a public hearing may be held by City on the issue and that the Tenant will receive notice of the hearing at least fifteen (15) days in advance of any such hearing. The Owner shall also file a copy of the above-described notice with City.
(b) In addition to the notice required above, Owner shall comply with the requirements set forth in California Government Code Sections 65863.10 and 65863.11. Such notice requirements include: (i) a twelve (12) month notice to existing tenants, prospective tenants and Affected Public Agencies (as defined in California Government Code Section 65863.10(a)) prior to the expiration of the Term, (ii) a six (6) month notice requirement to existing tenants, prospective tenants and Affected Public Agencies prior to the expiration of the Term; (iii) a notice of an offer to purchase the Development to "qualified entities" (as defined in California Government Code Section 65863.11(d)), if the Development is to be sold within five (5) years of the end of the Term; (iv) a notice of right of first refusal within the one hundred eighty (180) day period that qualified entities may purchase the Development.

6.4 Covenants to Run With the Land. City and Owner hereby declare their express intent that the covenants and restrictions set forth in this Agreement shall run with the land, and shall bind all successors in title to the Property, provided, however, that on the expiration of the Term of this Agreement said covenants and restrictions shall expire. Each and every contract, deed or other instrument hereafter executed covering or conveying the Property or any portion thereof shall be held conclusively to have been executed, delivered and accepted subject to such covenants and restrictions, regardless of whether such covenants or restrictions are set forth in such contract, deed or other instrument, unless City expressly releases such conveyed portion of the Property from the requirements of this Agreement.

6.5 Enforcement by the City.
(a) If Owner fails to perform any obligation under this Agreement, and fails to cure the default within 30 days after City has notified the Owner in writing of the default or, if the default cannot be cured within 30 days, fails to commence to cure within 30 days and thereafter diligently pursue such cure, City shall have the right to enforce this Agreement by any or all of the following actions, or any other remedy provided by law:
17 (i) Calling the Loan. City may declare a default under the Note, accelerate the indebtedness evidenced by the Note, and proceed with foreclosure under the Deed of Trust.
(ii) Action to Compel Performance or for Damage. City may bring an action at law or in equity to compel Owner's performance of its obligations under this Agreement, and/or for damages.
(iii) Remedies Provided Under Loan Documents. City may exercise any other remedy provided under the Loan Documents.
(b) The City shall provide notice of a default to the Investor Limited Partner and any limited partner of Owner who has requested written notice from the City in the manner set forth in Section 6.1 of the Loan Agreement.

6.6 Attorney's Fees and Costs. In any action brought to enforce this Agreement, the prevailing party shall be entitled to all costs and expenses of suit, including reasonable attorneys' fees. This section shall be interpreted in accordance with California Civil Code Section 1717 and judicial decisions interpreting that statute.

6.7 Recording and Filing. City and Owner shall cause this Agreement, and all amendments and supplements to it, to be recorded against the Property in the Official Records of the County of Alameda. This Agreement encumbers only the Owner's leasehold interest in the Property and does not encumber the City's fee title to the Property.

6.8 Governing Law. This Agreement shall be governed by the laws of the State of California.

6.9 Amendments. This Agreement may be amended only by a written instrument executed by all the parties hereto or their successors in title, and duly recorded in the real property records of the County of Alameda, California.

6.10 Notice. All notices given or certificates delivered under this Agreement shall be in writing and be deemed received on the delivery or refusal date shown on the delivery receipt, if: (i) personally delivered by a commercial service which furnishes signed receipts of delivery or (ii) mailed by certified mail, return receipt requested, postage prepaid, addressed as shown on the signature page. Any of the parties may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates or communications shall be sent.

6.11 Severability. If any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining portions of this Agreement shall not in any way be affected or impaired thereby.

6.12 Multiple Originals; Counterparts. This Regulatory Agreement may be executed in multiple originals, each of which is deemed to be an original, and may be signed in counterparts.

6.13 Revival of Agreement after Foreclosure. In the event there is a foreclosure of the Property, this Regulatory Agreement will revive according to its original terms if, during the Term, the owner of record before the foreclosure, or deed in lieu of foreclosure, or any entity that includes the former owner or those with whom the former owner has or had family or business ties, obtains an ownership interest in the Development or Property. 18 18
19 IN WITNESS WHEREOF, the City and Owner have executed this Agreement by duly authorized representatives, all on the date first written above.

Address:

City of Union City
34009 Alvarado-Niles Road
Union City, CA 94587
Attn: City Manager

CITY:

CITY OF UNION CITY, a California municipal
corporation
By: _____________________________
Joan Malloy, City Manager
Attest:

By: _____________________________
Thai Nam Pham, City Clerk
Approved as to Form:

By: _____________________________
Kristopher Kokotaylo, City Attorney
Address:

MP Lazuli Landing Associates, L.P.
c/o MidPen Housing Corporation
303 Vintage Park Dr., Suite 250
Foster City, CA 94404
Attention: Chief Real Estate Development
Officer
BORROWER:

MP Lazuli Landing Associates L.P.,
a California limited partnership
By: MP Lazuli Landing LLC
a California limited liability company,
its general partner
By: MidPen Housing Corporation,
a California nonprofit public benefit
corporation, its sole member/manager
By: ____________________________
Abigail Goldware Potluri,
Assistant Secretary

19 20

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

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

WITNESS my hand and official seal.
______________________________________
Name: ______________________________
Notary Public
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. 20 21

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

EXHIBIT A
Property Description

Union City City CouncilOctober 28, 2025

Union City City Council
October 28, 2025