Upland City Council
November 14, 2022

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47 7.1.2 The injured Party shall give written notice of default to the Party in default, specifying the default complained of by the non-defaulting Party. Delay in giving such notice shall not constitute a waiver of any default nor shall it change the time of default.

7.1.3 Any failure or delays by any Party in asserting any of their rights and/or remedies as to any default shall not operate as a waiver of any default or of any such rights or remedies. Delays by any Party in asserting any of its rights and/or remedies shall not deprive that Party of its right to institute and maintain any actions or proceedings that it may deem necessary to protect, assert or enforce any such rights or remedies.

7.1.4 In addition to other acts or omissions of the Developer that may legally or equitably constitute a default or breach of this Agreement, the occurrence of any of the following specific events, prior to the issuance of a Certificate of Completion for the Project, shall constitute an “Event of Default” under this Agreement and shall not be subject to the notice and cure provisions of Section 7.1.1:

7.1.4.1 Any material default by the Developer under any Security Financing Instrument for any purpose or reason that remains uncured following any applicable notice and expiration of any applicable cure period under such Security Financing Instrument.

7.1.4.2 Any representation, warranty or disclosure made to the City by the Developer regarding this Agreement or the Project is materially false or misleading, whether or not such representation or disclosure appears in this Agreement.

7.1.4.3 Subject to extension for Unavoidable Delays, (i) the construction of the Project is delayed or suspended for a period in excess of that permitted under Section 4.4 or (ii) the Developer has not been issued, or entitled to be issued, a Certificate of Completion by the Project Completion Date.

7.1.4.4 There occurs any event of dissolution, reorganization or termination of the Developer that adversely and materially affects the operation or value of the Property or the Project, and such event is not corrected within five (5) days following written notice of such event from the City to the Developer.

7.1.4.5 The Developer transfers its interest in this Agreement, the Property, or the Project, or any portion thereof, whether voluntarily or involuntarily or by operation of law, in violation of the terms and conditions of this Agreement and such action is not cured within the period prescribed in Section 8.2.2.

7.1.4.6 The Developer becomes insolvent; becomes, whether voluntarily or involuntarily, a debtor or debtor-in-possession under Title 11 of the United States Code; or a

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48 receiver, assignee, or trustee is appointed to conduct the affairs of the Developer under state or federal law.

7.1.4.7 The Developer’s legal entity status authorized by the Secretary of State of the State of California to transact business in California is suspended or terminated.

7.2 DEVELOPER’S ELECTION RE: SPECIFIC ENFORCEMENT OF

AGREEMENT OR WAIVER OF RIGHT TO SPECIFIC PERFORMANCE AND LIMITATION ON RECOVERY OF DAMAGES PRIOR TO CLOSE OF ESCROW. UPON

THE OCCURRENCE OF AN EVENT OF DEFAULT PERTAINING TO THE CONVEYANCE

OF THE PROPERTY BY THE CITY UNDER THIS AGREEMENT PRIOR TO CLOSE OF

ESCROW, THE DEVELOPER SHALL, AS ITS SOLE AND EXCLUSIVE REMEDY, HAVE

THE RIGHT TO EXERCISE ONE OF THE ALTERNATIVE REMEDIES DESCRIBED IN SECTIONS 7.2.1 AND 7.2.2. THE DEVELOPER’S ELECTION, ONCE MADE, SHALL BE IRREVOCABLE.

7.2.1 WAIVER OF RIGHT TO SPECIFIC PERFORMANCE AND
LIMITATION ON RECOVERY OF DAMAGES. THE DEVELOPER MAY WAIVE THE REMEDIES SET FORTH IN SECTION 7.2.2 AND MAY CANCEL THE ESCROW PURSUANT TO SECTION 3.10, AND UPON CANCELLATION OF THE ESCROW, THE

DEVELOPER SHALL BE RELIEVED OF ANY OBLIGATION UNDER THIS AGREEMENT

TO PURCHASE OR ACCEPT TITLE TO THE PROPERTY AND ANY SUCH ESCROW

CANCELLATION SHALL BE WITHOUT ANY LIABILITY OF THE DEVELOPER TO THE CITY OR ANY OTHER PERSON ARISING FROM SUCH ACTIONS. THE DEVELOPER

SHALL BE LIMITED TO RECOVERING ANY AMOUNTS ACTUALLY EXPENDED BY

THE DEVELOPER IN REASONABLE RELIANCE ON THIS AGREEMENT PRIOR TO THE

DATE OF THE OCCURRENCE OF THE EVENT OF DEFAULT BY THE CITY, NOT TO EXCEED SEVENTY-FIVE THOUSAND DOLLARS ($75,000); THE DEVELOPER WAIVES

ANY RIGHT TO RECOVER ANY OTHER SUMS FROM THE CITY ARISING FROM AN EVENT OF DEFAULT BY THE CITY PRIOR TO THE CLOSE OF ESCROW. THE DEVELOPER ACKNOWLEDGES THE PROTECTIONS OF CIVIL CODE SECTION 1542 RELATIVE TO THE WAIVER AND RELEASE CONTAINED IN THIS SECTION 7.2.1, WHICH CIVIL CODE SECTION READS AS FOLLOWS:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS

THAT THE CREDITOR OR RELEASING PARTY DOES NOT

KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT

THE TIME OF EXECUTING THE RELEASE AND THAT, IF

KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY

AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR
OR RELEASED PARTY.”

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49 BY INITIALING BELOW, THE DEVELOPER KNOWINGLY AND VOLUNTARILY WAIVES THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS AND RELEASES OF THIS SECTION 7.2.1.

DEVELOPER’S INITIALS ____________

IN CONNECTION WITH THE WAIVERS OF THIS SECTION 7.2.1, THE

DEVELOPER FURTHER WAIVES THE RIGHT TO RECORD A NOTICE OF PENDENCY

OF ACTION AGAINST ALL OR ANY PORTION OF THE PROPERTY EXCEPT

DEVELOPER MAY RECORD SUCH A NOTICE IN CONNECTION WITH ANY SU IT FOR

SPECIFIC PERFORMANCE PERMITTED HEREUNDER IN THE EVENT DEVELOPER

ELECTS NOT TO WAIVE ITS RIGHT TO SEEK SPECIFIC PERFORMANCE UNDER SECTION 7.2.2.

7.2.2 SPECIFIC PERFORMANCE. THE DEVELOPER MAY WAIVE THE REMEDIES SET FORTH IN SECTION 7.2.1 AND, IN ACCORDANCE WITH CIVIL CODE SECTION 3384, ET SEQ., INSTITUTE AN ACTION AGAINST THE CITY FOR SPECIFIC

PERFORMANCE OF THE TERMS OR PROVISIONS OF THIS AGREEMENT WHICH WERE TO HAVE BEEN COMPLETED BY THE CITY PRIOR TO THE CLOSE OF ESCROW. IF

THE DEVELOPER PROCEEDS WITH SPECIFIC PERFORMANCE UNDER THIS SECTION

7.2.2, THE DEVELOPER SHALL HAVE NO RIGHT TO ANY MONETARY DAMAGES.

7.2.3 City’s Remedies. IF AFTER DELIVERING ITS DUE DILIGENCE

APPROVAL NOTICE DEVELOPER BREACHES ITS OBLIGATION TO COMPLETE THE PURCHASE OF THE PROPERTY FOR ANY REASON OTHER THAN THE CITY’S

DEFAULT OR THE FAILURE OF A DEVELOPER CONDITION TO CLOSING, THEN THE

CITY SHALL BE RELEASED FROM ALL OF ITS OBLIGATIONS UNDER THIS

AGREEMENT AND SHALL BE ENTITLED TO OBTAIN AND KEEP THE EARNEST

MONEY AS LIQUIDATED DAMAGES PLUS ANY AMOUNTS ACTUALLY EXPENDED

BY THE CITY IN REASONABLE RELIANCE ON THIS AGREEMENT PRIOR TO THE

DATE OF THE OCCURRENCE OF THE EVENT OF DEFAULT BY THE DEVELOPER, NOT TO EXCEED FIFTY THOUSAND DOLLARS ($50,000) AS ITS SOLE AND EXCLUSIVE REMEDY (EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION). IN LIGHT OF THE DIFFICULTY THE PARTIES WOULD HAVE IN DETERMINING THE CITY’S ACTUAL DAMAGES AS A RESULT OF SUCH BREACH OF DEVELOPER’S OBLIGATION TO

PURCHASE THE PROPERTY, THE PARTIES AGREE THAT THE EARNEST MONEY IS A

REASONABLE ESTIMATE OF THE EXTENT TO WHICH THE CITY WOULD BE DAMAGED BY SUCH BREACH. IN CONSIDERATION OF THE CITY RECEIVING THE

LIQUIDATED DAMAGES, THE CITY SHALL BE DEEMED TO HAVE WAIVED ALL OF

ITS OTHER REMEDIES AND CLAIMS AGAINST DEVELOPER AT LAW AND IN EQUITY

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50 INCLUDING ANY RIGHTS SELLER MAY HAVE PURSUANT TO SECTION 1680 OR SECTION 3389 OF THE CALIFORNIA CIVIL CODE, EXCEPT AS OTHERWISE PROVIDED BELOW. NOTWITHSTANDING ANYTHING TO THE CONTRARY

CONTAINED IN THIS SECTION, IF DEVELOPER BRINGS AN ACTION AGAINST THE

CITY FOR AN ALLEGED BREACH OR DEFAULT BY THE CITY OF ITS OBLIGATIONS UNDER THIS AGREEMENT (AN “ACTION”) AND IN CONNECTION WITH THAT

ACTION RECORDS A LIS PENDENS OR OTHERWISE ENJOINS OR RESTRICTS THE CITY’S ABILITY TO SELL OR TRANSFER THE PROPERTY, THE CITY SHALL NOT BE

RESTRICTED BY THE PROVISIONS OF THIS SECTION FROM SEEKING

EXPUNGEMENT OR RELIEF FROM THAT LIS PENDENS, INJUNCTION OR OTHER

RESTRAINT, AND RECOVERING COSTS OR EXPENSES (INCLUDING REASONABLE ATTORNEYS’ FEES) ARISING THEREFROM TO THE EXTENT THE CITY IS THE PREVAILING PARTY IN SUCH ACTION. IF THE CITY ENGAGES IN A LEGAL

PROCEEDING OR ARBITRATION TO OBTAIN THE EARNEST MONEY, AND THE CITY

IS SUCCESSFUL IN SUCH ACTION, THEN IN ADDITION TO THE EARNEST MONEY, THE CITY SHALL BE ENTITLED TO RECOVER ITS REASONABLE ATTORNEYS’ FEES IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT. IN ADDITION, THE CITY

SHALL NOT BE RESTRICTED BY THE PROVISIONS OF THIS SECTION FROM

RECOVERING DAMAGES, COSTS OR EXPENSES (INCLUDING, WITHOUT LIMITATION, ATTORNEY’S FEES AND COURT COSTS) WHICH THE CITY MAY

SUFFER OR INCUR AS A RESULT OF THE BREACH BY DEVELOPER OF ITS OBLIGATIONS TO INDEMNIFY UNDER THIS AGREEMENT.

7.3 Legal Actions.

7.3.1 Except as otherwise provided by Sections 7.2 and 7.3, any Party may institute legal action to cure, correct or remedy any default, to recover damages for any default, or to obtain any other remedy available to that Party under this Agreement or at law or in equity.

Such legal actions must be instituted in the Superior Court of the State of California in and for the County of San Bernardino, California.

7.3.2 The procedural and substantive laws of the State of California shall govern the interpretation and enforcement of this Agreement, without regard to conflicts of laws principles. The Parties acknowledge and agree that this Agreement is entered into, is to be fully performed in and relates to real property located in the City of Upland, County of San Bernardino, California.

7.4 Rights and Remedies are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties set forth in this ARTICLE VII are non- exclusive and cumulative, and the exercise by any Party of one or more of such rights or remedies

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51 shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party(ies).

7.5 Developer Indemnification of the City. In addition to any other specific indemnification or defense obligations of the Developer set forth in this Agreement, the Developer agrees to indemnify, defend (upon written request by the City and with counsel reasonably acceptable to the City) and hold harmless the Indemnified Parties, from any and all losses, liabilities, charges, damages, claims, liens, causes of action, awards, judgments, costs and expenses (collectively “Claims”), including, but not limited to reasonable attorney’s fees of counsel retained by the Indemnified Parties, expert fees, costs of staff time, and investigation costs, of whatever kind or nature, that are in any manner directly or indirectly caused, in whole or in part, by any act, omission, fault or negligence, whether active or passive, of the Developer or the Developer’s officers, agents, employees, independent contractors or subcontractors of any tier, relating in any manner to this Agreement, any work to be performed by the Developer related to this Agreement, the Property, or the Project, or any authority or obligation exercised or undertaken by the Developer under this Agreement, provided that such Claim did not arise from the active or passive negligence or the misconduct of any Indemnified Party. Without limiting the generality of the foregoing, the Developer’s obligation to indemnify the Indemnified Parties shall include injury or death to any person or persons, damage to any property, regardless of where located, including the property of the Indemnified Parties, any workers’ compensation or prevailing wage determination, claim or suit or any other matter arising from or connected with any goods or materials provided or services or labor performed regarding the Project or the Property on behalf of the Developer by any person or entity. The provisions of this Section 7.5 shall survive the termination of this Agreement or the Close of Escrow, and shall not merge into the Grant Deed.

ARTICLE VIII.

GENERAL PROVISIONS.

8.1 Incorporation of Recitals. The Recitals of fact set forth preceding this Agreement are true and correct and are incorporated into this Agreement in their entirety by this reference.

8.2 Restrictions on Transfers.

8.2.1 The Developer acknowledges that the qualifications and identity of the Developer are of particular importance to the City. The Developer further recognizes and acknowledges that the City has relied and is relying on the specific qualifications and identity of the Developer in entering into this Agreement with the Developer and, as a consequence, Transfers are permitted only as expressly provided in this Agreement. The Developer shall promptly notify the City in writing of any and all changes wh atsoever in the identity of the business entities or individuals either comprising or in Control of the Developer, as well as any and all changes in the

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52 interest or the degree of Control of the Developer by any such person, of which information the Developer or any of its partners, members or officers are notified or may otherwise have knowledge or information.

8.2.2 Except as expressly permitted in this Agreement, the Developer represents to the City that it has not made and agrees that it will not make or crea te, or suffer to be made or created, any Transfer other than a Permitted Transfer, either voluntarily, involuntarily or by operation of law, until after the recordation of a Certificate of Completion for the Project subject to the Transfer; provided, however, that the City may approve in its reasonable discretion, Transfers other than Permitted Transfers prior to the recordation of a Certificate of Completion. In deciding whether to approve or disapprove any proposed Transfer, the City may consider the proposed transferee’s financial strength and the experience of the proposed transferee and its senior management in undertaking and successfully completing projects of a similar type and size as the Project or that portion of the Project proposed to be transferred. Any Transfer made in contravention of this Section 8.2 shall be voidable at the election of the City and this Agreement may be terminated by the City or the City may exercise any other remedy available to the City under the terms of this Agreement, provided, however, that (i) the City shall first notify the Developer in writing of its intention to terminate this Agreement or to exercise any other remedy, and (ii) the Developer shall have twenty (20) calendar days following its receipt of such written notice to commence and, thereafter, diligently and continuously proceed to cure the default of the Developer and submit evidence of the initiation and satisfactory completion of such cure to the City, in a form and substance reasonably satisfactory to the City.

8.2.3 The Developer shall provide the City no less than thirty (30) days prior written notice of any proposed Permitted Transfer which the Developer desires to enter into prior to the recordation of a Certificate of Completion for the Project subject to the Transfer, other than a Permitted Transfer for which no notice shall be required. The Developer shall have the burden of demonstrating to the City’s reasonable satisfaction that the proposed Permitted Transfer meets the conditions and requirements of this Agreement with respect to Permitted Transfers.

8.2.4 Anything in this Agreement to the contrary notwithstanding, the restrictions and prohibitions on Transfers contained in this Section 8.2 shall terminate upon issuance of a Certificate of Completion for the Project.

8.3 Notices, Demands and Communications Between the Parties.

8.3.1 Any and all notices, demands or communications submitted by any Party to another Party pursuant to or as required by this Agreement shall be proper, if in writing and dispatched by messenger for immediate personal delivery, by a nationally recognized overnight courier service or by registered or certified United States Mail, postage prepaid, return receipt requested, to the principal office of the City or the Developer, as applicable, as designated in

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53 Section 8.3.2. Such written notices, demands or communications may be sent in the same manner to such other addresses as either Party may from time to time designate. Any such notice, demand or communication shall be deemed to be received by the addressee, regardless of whether or when any return receipt is received by the sender or the date set forth on such return receipt, on the day that it is delivered by personal delivery, on the date of delivery by a nationally recognized overnight courier service or three (3) calendar days after it is placed in the United States Mail, as provided in this Section 8.3.

8.3.2 The following are the authorized addresses for the submission of notices, demands or communications to the Parties:

TO DEVELOPER: City Ventures Homebuilding, LLC
3121 Michelson Drive, Suite 150
Irvine, California 92612
Attn: Michelle Thrakulchavee
(T) (949) 258-7536

COPIES TO:

City Ventures Homebuilding, LLC
3121 Michelson Drive, Suite 150
Irvine, California 92612
Attn: Mark Buckland
(T) (949) 258-7518

Kenneth M. Kaplan, Esq.
580 Broadway Street, Suite 202
Laguna Beach, CA 92651
(T) (949) 230-3117
TO CITY:

COPY TO:

City of Upland
460 N Euclid Ave
Upland, California 91786
Attention: City Manager
(T) (909) 931-4100

Best Best & Krieger, LLP
300 S Grand Avenue, Floor 25
Los Angeles, CA 90071
Attention: Isaac Rosen
(T) (213) 787-2564

8.4 Conflict of Interest. No member, official or employee of the City, having any conflict of interest, direct or indirect, related to this Agreement, the Property, or the development or operation of the Project shall participate in any decision relating to this Agreement. The Parties represent and warrant that they do not have knowledge of any such conflict of interest.

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54 8.5 Warranty Against Payment of Consideration for Agreement. The Developer warrants that it has not paid or given, and will not pay or give, any third party any money or other consideration for obtaining this Agreement. Third parties, for the purposes of this Section 8.5, shall not include persons to whom fees are paid for professional services, if rendered by attorneys, financial consultants, accountants, engineers, architects and the like when such fees are considered necessary by the Developer.

8.6 Non-liability of City, Officials and Employees. No member, official or employee of the City shall be personally liable to the Developer, or any successor in interest of the Developer, in the event of any default or breach by the City under this Agreement or for any amount that may become due to the Developer or to its successor, or on any obligations under the terms of this Agreement, except as may arise from the gross negligence or willful acts of such member, official or employee.

8.7 Unavoidable Delay; Extension of Time of Performance.

8.7.1 Subject to specific provisions of this Agreement, performance by any Party under this Agreement shall not be deemed, or considered to be, in default where any such default is due to an Unavoidable Delay that is not attributable to the fault of the Party claiming an extension of time to perform. An extension of time for any Unavoidable Delay shall be for the period of the Unavoidable Delay and shall commence to run from the date of occurrence of the Unavoidable Delay, if the Party asserting the existence of the Unavoidable Delay provides the other Parties with written notice of the occurrence of the Unavoidable Delay, within thirty (30) days of the commencement of such asserted Unavoidable Delay. Otherwise, the extension of time for an Unavoidable Delay shall commence on the date of receipt of written notice of the occurrence of the Unavoidable Delay by the Parties not requesting an extension of time to perform due to such Unavoidable Delay.

8.7.2 The Parties expressly acknowledge and agree that changes in either general economic conditions or changes in the economic assumptions of either of them that may have provided a basis for entering into this Agreement and that occur at any time after the execution of this Agreement, do not constitute an Unavoidable Delay and do not provide any Party with grounds for asserting the existence of an Unavoidable Delay in the performance of any covenant or undertaking arising under this Agreement. Each Party expressly assumes the risk that changes in general economic conditions or changes in such economic assumptions relating to the terms and covenants of this Agreement could impose an inconvenience or hardship on the continued performance of such Party under this Agreement.

8.8 Inspection of Books and Records. The City shall have the right at all reasonable times, at the City’s cost and expense, to inspect the books and records of the Developer pertaining

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55 to the Property and/or the Project. The Developer shall also have the right at all reasonable times, at the Developer’s sole cost and expense, to inspect the books and records of the City pertaining to the Property and/or the Project, to the extent relevant to the Developer’s obligations under this Agreement. Nothing in this Section 8.8 or elsewhere in this Agreement shall, however, constitute a waiver or modification of any right, privilege, duty, or obligation which any Party may have with respect to any document, statement, or other record, including, without implied limitation, the attorney-client privilege, the attorney-work product privilege, any privilege arising under any state or federal evidentiary code or rule, or any privilege or exclusionary right or any duty arising under any state or federal freedom of information or public records disclosure law, including, but not limited to, the California Public Records Act (Government Code § 6520 et seq.).

8.9 Real Estate Commissions. The Developer and the City each represent that they have not engaged any real estate brokers in connection with the transaction contemplated by this Agreement.

8.10 Binding on Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective heirs, executors, administrators, legal representatives, successors, and assigns.

8.11 Entire Agreement.

8.11.1 This Agreement shall be executed in three (3) duplicate originals, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. This Agreement constitutes the entire understanding and agreement of the Parties regarding the Property, the Project, and the other subjects addressed in this Agreement.

8.11.2 This Agreement integrates all of the terms and conditions mentioned in this Agreement or incidental to this Agreement, and supersedes all negotiations or previous agreements between the Parties with respect to the Property, the Project, and the other subjects addressed in this Agreement.

8.11.3 None of the terms, covenants, agreements or conditions set forth in this Agreement shall be deemed to be merged with any deed conveying title to the Property and this Agreement shall continue in full force and effect before and after such conveyances.

8.11.4 All waivers of the provisions of this Agreement and all amendments to this Agreement must be in writing and signed by the authorized representative(s) of all Parties.

8.12 Execution of this Agreement. Following execution of three (3) originals of this Agreement by the authorized representative(s) of the Developer and prompt delivery of such originals, thereafter, to the City, accompanied by an official action of the governing body of the Developer authorizing the individuals executing this Agreement on behalf of the Devel oper to

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56 execute and perform this Agreement, in form and substance acceptable to the City, this Agreement shall be subject to the review and approval by the City Council, in its sole and absolute discretion, no later than forty-five (45) calendar days after such date of delivery to the City. If the City has not approved, executed, and delivered an original of this Agreement to the Developer within the foregoing time period, then no provision of this Agreement shall be of any force or effect for any purpose.

8.13 Survival of Indemnity Obligations. All general and specific indemnity and defense obligations of the Parties set forth in this Agreement shall survive the expiration or termination of this Agreement, the execution or recordation of the Grant Deed, and/or the issuance and recordation of any Certificate of Completion.

8.14 Time Declared to be of the Essence. As to the performance of any obligation hereunder as to which time is a component thereof, the performance of such obligation within the time provided is of the essence.

8.15 Approvals. Except as otherwise provided in this Agreement, approvals required of the City or the Developer, or any officers, agents or employees of the City or the Developer, shall not be unreasonably withheld and approval or disapproval shall be given within the time set forth in this Agreement or, if no time is given, within a reasonable time.

8.16 Further Assurances. The Parties agree to reasonably consider such additional actions or the execution of such other documents as may be reasonably necessary or convenient to the financing, development, and operation of the Project, although nothing in this Section 8.16 shall be deemed a representation, guaranty or commitment by any Party to take any action or execute any document.

8.17 City Approvals and Actions. The City Manager shall have the authority and discretion, on behalf of the City (to the extent not provided otherwise in this Agreement), to make approvals, issue interpretations, waive provisions, grant extensions of time, approve amendments to this Agreement and changes to the attached exhibits prior to their execution and execute documents, including, without limitation, the Notice of Completion and any documents necessary to implement any changes in the number or affordability of the Qualifying Units (as defined in the City Regulatory Agreement), so long as such actions do not reduce the length of affordability of the Qualifying Units (as defined in the City Regulatory Agreement) or add to the costs incurred or to be incurred by the City as specified herein. The City Manager reserves the right, in his or her sole and absolute discretion, to submit any requested modification, interpretation, amendment or waiver to the City Council if the City Manager determines or believes that such action coul d increase the risk, liability or costs to City, or reduce the length of affordability of the Project.

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57 [Signatures on Following Pages]

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S-1

SIGNATURE PAGE
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

CITY:

THE CITY OF UPLAND
a public body corporate and politic

Dated:_________________,2022 By:

City Manager

ATTEST:

____________________________
City Clerk

APPROVED AS TO LEGAL FORM:

BEST BEST & KRIEGER LLP

By: _______________________
Isaac Rosen, City Attorney’s Office

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S-2

SIGNATURE PAGE
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

DEVELOPER:

City Ventures Homebuilding, LLC, a
Delaware limited liability company

By: City Ventures Communities, LLC, a
Delaware limited liability company,
its sole member

Dated:_________________, 2022 By: ______________________________ Name:_____________________________
Its: _______________________________

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EXHIBIT A
A-1

EXHIBIT A
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Northwest Corner of First Avenue and A Street
UPLAND, CA 91786
APN 1046-591-08, 09, 10, 11, 12, 13

[LEGAL DESCRIPTION]

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EXHIBIT B
B-1

EXHIBIT B
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Scope of Development

The Provisions of the Scope of Development require future discussion between the City and Developer.

Developer intends to construct a residential for-sale community consisting of 29 three-story townhomes ranging between 1,300 square feet to 1,650 square feet in size on the Property with an affordable housing component reserved for five income-restricted dwelling units. The proposed plan mix is to be comprised of:
 Three(3) 1,300 sq. ft. units with three bedrooms each:
 Three (3) 1,325 sq. ft. units with three bedrooms each;  Five (5) 1,350 sq. ft. units with three bedrooms each;  Four (4) 1,650 sq. ft. units with four bedrooms each; and  Fourteen (14) 1,650 sq. ft. units with three bedrooms each.

Five (5) out of the twenty nine (29) units shall be affordable housing dwelling units that are sold at an affordable housing cost for the household. The annual income of the households in these five (5) units shall not exceed 80% of AMI.

Income restricted affordable housing dwelling units provided by the Project are to serve the needs of households with qualifying gross annual incomes not to exceed 80% of AMI. The final distribution of AMI targets across the range of dwelling unit types will be at Developer’s discretion, but in no cases shall the share of dwelling units serving households at or below 80% of AMI be less than 15% of total dwelling units developed.

The Scope of Development will include all necessary physical improvements customary for a development of not less than 15% Affordable Homes, and will be compliant with all local, state and federal regulations and development standards for the same.

Developer and the City recognize the possibility that site constraints may result in a reduction in the number of residential dwelling units that may be feasible to construct of the Property, in which case the affordable housing component shall be at least 15% of the residential dwelling units for which Developer receives City approval.

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EXHIBIT B
B-2

This Scope of Development will be guided by conceptual site design, product type, plan layouts, community amenities, landscape and area development proposals provided by Developer in its proposal, and as demonstrated in Attachment A to this Exhibit. As represented by Attachment A, the proposed development program is subject to change and may be revised due to community expectations, entitlement issues, changes in construction standards, architectural and engineering requirements, and other unforeseen circumstances all of which changes shall be subject to the City’s consent, which consent will not be unreasonably withheld.

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EXHIBIT B
B-3

ATTACHMENT A (DEVELOPER SITE PLAN & PROJECT PROPOSAL) TO EXHIBIT B: SCOPE OF DEVELOPMENT

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EXHIBIT
C-1
US_147327162v2_389658-00013 1/7/2021 8:04 PM

NOTE:

Many of the actions may only commence after completion of the prior action or actions including actions which are dependent upon prior consents or approvals from the City.

Accordingly, the entries in the Schedule should take that fact into account.

EXHIBIT C
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Schedule of Performance

Item Action* Schedule
1 Effective Date See Section 1.2.3
2 Due Diligence Period commences On Effective Date
3 Developer to deliver Preliminary
Report to City
Within 5 days of Effective Date
4 City to deliver existing site studies
to Developer
Within 5 days of Effective Date
5 Developer to deliver Developer’s
Title Notice to City, if appropriate
Within 30 days of Developer’s receipt of the
Preliminary Report
6 City to deliver City’s Title Notice
Response to Developer, if
appropriate
Within 20 days of City’s receipt of Developer’s
Title Notice

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EXHIBIT
C-2
US_147327162v2_389658-00013 1/7/2021 8:04 PM

Item Action* Schedule
7 Planning Commission shall
determine compliance of sale of
land with the General Plan pursuant
to Gov’t Code Section 65402
Prior to expiration of Due Diligence Period
8 Due Diligence Period end At 5:00 p.m. on the 90th day following the Effective Date
9 Developer to prepare conceptual
site plans and elevations sufficient
to meet needs of entitlement
application
Within 90 days of Developer’s delivery of Due
Diligence Investigation Approval Notice
10 Developer to submit entitlement
application required for approval of
project entitlements and
environmental clearance
Within 90 days of Developer’s delivery of Due
Diligence Investigation Approval Notice
11 City to hold necessary public
hearings and issue decision on
Developer’s entitlement application
Within 90 days of Developer’s submittal of
complete entitlement application
12 Developer to initiate preparation of
construction documents
Within 30 days of Developer’s receipt of final
approval of entitlements
13 Developer to submit construction
documents to City Building &
Safety for first plan check
Within 140 days of Developer initiating the
preparation of construction documents
14 City and San Bernardino County
Fire Protection District to complete
first plan check review and request
revisions (if any) from Developer
Within 30 working days of Developer’s first
plan check submittal

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EXHIBIT
C-3
US_147327162v2_389658-00013 1/7/2021 8:04 PM

Item Action* Schedule
15 Developer to submit second plan
check revisions to City Building &
Safety
Within 45 days of Developer’s receipt of City’s
requested revisions to first plan check
16 City and San Bernardino County
Fire Protection District to complete
second plan check review
Within 21 working days of Developer’s second
plan check submittal
17 City to provide Developer with
ready to issue permit notification
Within 7 days after completion of City’s and San
Bernardino County Fire Protection District’s
second plan check review**
18 Escrow Closing Date. May be
extended upon approval of City as
per Section 3.6
On or before the 5th Business Day following the
later of: (a) Escrow Holder’s receipt of written
confirmation from both City and Developer of
the satisfaction or waiver of all conditions
precedent to the Close of Escrow, or (b) no later
than eighteen (18) months after the Effective
Date, whichever is less.
19 Developer to initiate Project
construction
The later of: (i) 30 days after Close of Escrow or
(ii) the issuance of a Grading Permit
20 City to conduct inspections for
purposes of issuing certificate of
occupancy to Developer, provided
Developer qualifies with all
required conditions.

Within 15 days of Developer’s written request

*The dates set forth are subject to change based upon Unavoidable Delays including delays resulting from the action or inaction of the City.

**The date set forth is contingent on City’s approval of second plan check. If City does not approve second plan check and a third plan check is required, the date set forth will be contingent on City’s approval of third plan check.

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EXHIBIT D
D-1

EXHIBIT D

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Form of Grant Deed

[Attached Behind This Page]

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EXHIBIT D
D-2

RECORDING REQUESTED BY:

City of Upland

WHEN RECORDED MAIL TO AND MAIL
TAX STATEMENTS TO:

City Ventures Homebuilding, LLC
3121 Michelson Drive, Suite 150
Irvine, California 92612
Attention: Michelle Thrakulchavee

Exempt from Recording Fee per Government
Code Section 27383

SPACE ABOVE FOR RECORDER’S USE ONLY

GRANT DEED

THE UNDERSIGNED GRANTOR(S) DECLARE(S):

Documentary Transfer Tax is $ _______________.;

PART ONE

FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged, THE CITY OF UPLAND, a public body corporate and politic (“Grantor”), hereby grants to City Ventures Homebuilding, LLC, a Delaware limited liability company (“Grantee”), that certain real property located in the City of Upland, County of San Bernardino, State of California, specifically described in Exhibit “A” attached to this Grant Deed (“Property”) and made a part of this Grant Deed by this reference.

PART TWO
The conveyance of the Property by the Grantor to the Grantee in Part One is subject to the following community development terms, conditions, covenants and restrictions:

Section 1. Conveyance Subject to Terms of a Housing Disposition and Development Agreement. The Property is conveyed pursuant to that certain unrecorded Housing Disposition and

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D-3

Development Agreement, dated as of _________, 2022, between the Grantor and the Grantee (the “Agreement”). The provisions of and Scope of Development and Schedule of Performance to the Agreement are attached hereto as Exhibit “B” and are deemed to be a part of this Grant Deed.

Section 2. Condition of Property. The Grantee acknowledges and agrees that the Property is conveyed by the Grantor to the Grantee in its “AS IS,” “WHERE IS” and “SUBJECT TO ALL FAULTS CONDITION,” as of the date of recordation of this Grant Deed, with no warranties, expressed or implied, as to the environmental or other physical condition of the Property, the presence or absence of any patent or latent environmental or other physical condition on or in the Property, or any other matters affecting the Property.

Section 3. Obligation to Refrain from Discrimination. The Grantee for itself, its successors and assigns to all or any part or portion of the Property and/or Project, covenants and agrees that:

3.1. There shall be no discrimination against or segregation of any person, or group of persons, on account of sex, marital status, race, color, religion, creed, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor shall the Grantee, 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, sub-tenants, sub-lessees or vendees of the Property.

With respect to familial status, this Section 3.1 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in this Section 3.1 hall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to this Section 3.1.

3.2. The covenant of this Section 3 shall run with the land of the Property in perpetuity and shall be enforceable against the Grantee and its successors and assigns in perpetuity.

Section 4. Form of Non-Discrimination and Non-Segregation Clauses. The Grantee for itself, its successors and assigns to all or any part or portion of the Property and/or Project, covenants and agrees that:

4.1. The Grantee, such successors and such assigns shall refrain from restricting the sale, lease, sublease, rental, transfer, use, occupancy, tenure or enjoyment of the Property (or any portion thereof) on the basis of sex, marital status, race, color, religion, creed, ancestry or national origin of any person. All deeds, leases or contracts pertaining to the Property shall contain or be subject to substantially the following non-discrimination or non-segregation covenants:

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D-4

(a) In deeds: “The grantee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through 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, sub-tenants, sub-lessee, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.

Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 5.2.1.2 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
(b) In leases: “The lessee herein covenants by and for itself, its successors and assigns, and all persons claiming under or through them, and this lease is made and accepted upon and subject to the following conditions: That there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry, in the leasing, subleasing, transferring, use, occupancy, tenure, or enjoyment of the premises herein leased nor shall the lessee 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, sub-lessee, sub-tenants, or vendees in the premises herein leased.

Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 5.2.1.2 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”
(c) In contracts: “There shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, national origin, or ancestry, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed or leased, nor shall the transferee or any person claiming under or through it, establish or permit any such practice or practices of discrimination

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EXHIBIT D
D-5

or segregation with reference to the selection, location, number, use, or occupancy, of tenants, lessees, sub-lessees, sub-tenants, or vendees of the premises herein transferred.” The foregoing provision shall be binding upon and shall obligate the contracting party or parties and any subcontracting party or parties, or other transferees under the instrument. “Notwithstanding the foregoing paragraph, with respect to familial status, paragraph 5.2.1.2 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in the foregoing paragraph shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to housing for senior citizens. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to foregoing paragraph.”

4.2. The covenants of this Section 4 shall run with the land of the Property in perpetuity.

PART THREE
Section 5. Grantee Covenant to Undertake Project. The Grantee covenants, for itself, its successors and assigns, to and for the exclusive benefit of the City, that the Grantee shall commence and complete the development of the Project described in the Scope of Work within the time period set forth in the Schedule of Performance. The Grantee covenants and agrees for itself, its successors, and assigns, that the Property shall be improved and developed with the Project in substantial conformity with the terms and conditions of the Scope of Development, the Schedule of Performance, any and all plans, specifications and similar development documents developed by Grantee in furtherance of the Scope of Work, except for such changes as may be mutually agreed upon in writing by and among the Parties, and all applicable laws, regulations, orders and conditions of each Governmental Agency with jurisdiction over the Property or the Project. The covenants of this Section 5 shall run with the land of the Property until the date of recordation of the Certificate of Completion.

Section 6. Covenants Run with the Land of the Property. Each of the covenants and agreements contained in this Grant Deed touch and concern the Property and each of them is expressly declared to be a community development covenant that runs with the land for the benefit of the Grantor and such covenants run with the land in favor of the Grantor for the entire period that such covenants are in full force and effect, regardless of whether the Grantor is or remains an owner of any land or interest in land to which such covenants relate. The Grantor, in the event of any breach of any such covenants, has the right to exercise all of the rights and remedies, and to maintain any actions at law or suits in equity or other proper proceedings, to enforce the curing of such breach, as provided in the Agreement or by law. The covenants contained in this Grant Deed are for the benefit of and are enforceable only by the Grantor, and shall survive the execution and

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D-6

recordation of this Grant Deed and the issuance and recordation of each and every Certificate of Completion, for the time period set forth above for each covenant, provided that the provisions of Part Two, Section 1, and Part Three, Section 5 shall terminate for all purposes upon the recordation of a Certificate of Completion signed by Grantor in the official records of the County Recorder.

Upon the written request of Grantee, Grantor agrees to execute and record an additional instrument sufficient to evidence and confirm such termination. For the avoidance of doubt, the provisions of Part Two, Sections 2 and 3, and Part Three, Sections 6 through 8, inclusive, shall continue in full force and effect notwithstanding the recording of a Certificate of Completion.

Section 7. Costs and Attorneys’ Fees for Enforcement Proceeding. If legal proceedings are initiated to enforce the rights, duties or obligations of any of the covenants set forth in this Grant Deed, then the prevailing party in such proceeding shall be entitled to collect its reasonable attorney fees and costs from the other party in addition to any other damages or relief obtained in such proceedings.

Section 8. Effect of Unlawful Provision; Severability. In the event that any provision of this Grant Deed is held to be invalid or unlawful by a final judgment of a court of competent jurisdiction, such invalidity shall not affect the validity of any other provision of this Grant Deed. (Signatures on following page)

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EXHIBIT D
D-7

GRANTOR:

THE CITY OF UPLAND
a public body corporate and politic

By: __________________________________,
City Manager

[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

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D-8

CERTIFICATE OF ACCEPTANCE OF

GRANT DEED

The undersigned hereby acknowledges acceptance by City Ventures Homebuilding, LLC, a Delaware limited liability company, the Grantee in the within Grant Deed, of the delivery of the subject Property described in the within Grant Deed from the City of Upland.

GRANTEE:

City Ventures Homebuilding, LLC, a Delaware
limited liability company

By: City Ventures Communities, LLC, a
Delaware limited liability company,
its sole member

Dated:_________________, 2021 By: ______________________________ Name:_____________________________
Its: _______________________________
[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

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D-9

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.

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EXHIBIT D
D-10

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.

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EXHIBIT D
D-11

EXHIBIT 1
TO

GRANT DEED
Northwest Corner of First Avenue and A Street
UPLAND, CA 91786
APN 1046-591-08, 09, 10, 11, 12, 13

[LEGAL DESCRIPTION]

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EXHIBIT E
E-1

EXHIBIT E
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Form of Notice of Agreement
[Attached Behind This Page]

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EXHIBIT E
E-2

RECORDING REQUESTED BY
AND WHEN RECORDED RETURN TO:

City of Upland
460 N Euclid Ave. Upland, California 91786
Attn: City Clerk’s Office

Exempt from Recording fee
pursuant to Gov’t Code § 27383

NOTICE OF AGREEMENT

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT
TO ALL INTERESTED PERSONS PLEASE TAKE NOTICE that City Ventures Homebuilding, LLC, a Delaware limited liability company (the “Developer”), and the City of Upland, a public body corporate and politic (the “City”), entered into an agreement entitled Housing Disposition and Development Agreement, dated as of ______, 2022 (the “Agreement”).

A copy of the Agreement is on file with the City and is available for inspection and copying by interested persons as a public record of the City at the City’s offices located at 460 N. Euclid Ave, Upland, California 91786, during the City’s regular business hours.

The Agreement affects the real property described in Exhibit A attached to this Notice of Agreement (the “Property”). The meaning of defined terms, indicated by initial capitalization, used in this Notice of Agreement shall be the same as the meaning ascribed to such terms in the Agreement.

PLEASE TAKE FURTHER NOTICE that the Agreement contains certain development covenants running with the land of the Property and other agreements between the Developer and the City affecting the Property, as set forth below (all section references are to the Agreement):

Section 4.1 of the Agreement provides:

4.1 Developer Covenant to Undertake Project. The Developer covenants, for itself, its successors and assigns, to and for the exclusive benefit of the City, that the Developer shall commence and complete the development of the Project on the Property within the time period for such actions set forth in the Schedule of Performance. The Developer covenants and agrees for itself, its successors, and assigns, that the Property shall be improved and developed with the Project in substantial conformity with the terms and conditions of this Agreement, the Scope of

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EXHIBIT E
E-3

Development, the Schedule of Performance, any and all plans, specifications and similar development documents required by this Agreement, except for such changes as may be mutually agreed upon in writing by and among the Parties, and all applicable laws, regulations, orders and conditions of each Governmental Agency with jurisdiction over the Property or the Project. The covenants of this Section 4.1 shall run with the land of the Property until the earlier of the date of recordation of the Certificate of Completion.

Section 5.1 of the Agreement provides:

5.1 Obligation to Refrain from Discrimination. The Developer for itself, its successors and assigns to all or any part or portion of the Property and/or Project, covenants and agrees that there shall be no discrimination against or segregation of any person, or group of persons, on account of sex, marital status, race, color, religion, creed, national origin or an cestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property nor shall the Developer, itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sub-tenants, sub-lessees or vendees of the Property.

With respect to familial status, this Section 5.1 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in this Section 5.1 shall be construed to affect Section 51.2, 51.3, 51.4, 51.10, 51.11 and 799.5 of the Civil Code relating to any housing for senior citizens, if applicable. Subdivisions (d) of Section 51 and Section 1360 of the Civil Code and subdivision (n), (o), and (p) of Section 12955 of the Government Code shall apply to this Section 5.1. The covenant of this Section 5.1 shall run with the land of the Property in perpetuity, shall be enforceable against the Developer and its successors and assigns, and shall be covenants set forth in the Grant Deed.

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EXHIBIT E
E-4

This NOTICE OF AGREEMENT is dated as of _________________, 20__, and has been executed on behalf of the Developer and the City by and through the signatures of their authorized representative(s) set forth below. This Notice of Agreement may be executed in counterparts and when fully executed each counterpart shall be deemed to be one original instrument. This Notice of Agreement shall terminate and be of no force and effect upon the recording of a Certificate of Completion signed by the City and recorded in the Official Records of the County Recorder. Upon the written request of Developer, the City agrees to execute and record an additional instrument sufficient to evidence and confirm such termination.

CITY:

THE CITY OF UPLAND,
a public body corporate and politic

Dated: _________________, 2022 By: _______________________________ City Manager
ATTEST:

____________________________
City Clerk

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E-5

APPROVED AS TO LEGAL FORM:

BEST BEST & KRIEGER LLP

By: _______________________
Isaac Rosen, City Attorney’s Office

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EXHIBIT E
E-6

DEVELOPER:

City Ventures Homebuilding, LLC, a Delaware
limited liability company

By: City Ventures Communities, LLC, a
Delaware limited liability company,
its sole member

Dated:_________________, 2022 By: ______________________________ Name:_____________________________
Its: _______________________________

[ALL SIGNATURES MUST BE NOTARY ACKNOWLEDGED]

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EXHIBIT E
E-7

EXHIBIT A
TO

NOTICE OF AGREEMENT
Northwest Corner of First Avenue and A Street
UPLAND, CA 91786
APN 1046-591-08, 09, 10, 11, 12, 13

[LEGAL DESCRIPTION]

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EXHIBIT F
F-1

EXHIBIT F
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Form of Official Action of Developer
The undersigned, all the members of City Ventures Homebuilding, LLC, a Delaware limited liability company, do hereby certify that City Ventures Homebuilding, LLC, will serve as the Developer of the Project under the Agreement described below. No consent or approval of any other person is required for the undersigned to make the certifications set forth in this Certificate.

The Developer further certifies that the following named person(s):

Michelle Thrakulchavee, ____________________
is, without any additional or further consent of any person, authorized and empowered for and on behalf of and in the name of the respective entity set forth above to: (1) sign and deliver that certain Disposition and Development Agreement, dated as of _____ , 2022 (“Agreement”), regarding the development of certain real property located in the City of Upland, California, and performance of other obligations of the “Developer” as set forth in the Agreement; (2) sign and deliver all other documents on behalf of the respective entity identified set forth above to be signed or executed in connection with the transactions contemplated in the Agreement; and (3) take all actions on behalf of the respective entity identified above that may be considered necessary to conclude the transactions and complete the development contemplated in the Agreement.

The authority conferred and certified to in this Certificate shall be considered retroactive and any and all acts authorized in this Certificate that were performed before the execution of this Certificate are approved and ratified by each entity identified above. The authority conferred and certified to in this Certificate shall continue in full force and effect until the City Manager of the City of Upland receives written notice of the revocation of this Certificate.

The Developer further certifies that the activities covered by the authorities conferred and certified to in this Certificate and the foregoing certifications constitute duly authorized activities of each entity identified above; that these authorities and certifications are now in full force and effect; and that there is no provision in any document under which either of the entities identified above is organized and/or that governs such entity’s continued existence or limits the power of the undersigned to confer the authorities or make the certifications set forth in this Certificate, and that the same are in conformity with the provisions of all such documents.

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EXHIBIT F
F-2

Dated:

DEVELOPER:

City Ventures Homebuilding, LLC, a
Delaware limited liability company
By: City Ventures Communities, LLC, a
Delaware limited liability company,
its sole member

By:____________________________
Name:__________________________
Its:_____________________________

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EXHIBIT G
G-1

EXHIBIT G
TO

HOUSING

DISPOSITION AND DEVELOPMENT AGREEMENT

Form of Certificate of Completion
[Attached Behind This Page]

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EXHIBIT G
G-2

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

City Ventures Homebuilding, LLC
3121 Michelson Drive, Suite 150
Irvine, California 92612
Attention: Michelle Thrakulchavee

Exempt from Recording fee
pursuant to Gov’t Code § 27383

CITY OF UPLAND

CERTIFICATE OF COMPLETION

I, ___________, City Manager of the City of Upland (the “City”) certify that:

Section 1. The Project required to be constructed in accordance with that certain Housing Disposition and Development Agreement, dated ____ , 2022 (the “Agreement”), between the City and City Ventures Homebuilding, LLC (the “Developer”), on that certain real property specifically described in the legal description(s) attached to this Certificate of Completion as Exhibit A (the “Property”), is complete in accordance with the provisions of the Agreement.

This Certificate of Completion constitutes conclusive evidence of the City’s determination of the Developer’s satisfaction of its obligation under the Agreement to construct and install the Project on the Property, including any and all buildings, parking areas, landscaping areas and related improvements necessary to support or meet any requirements applicable to the Project and its use and occupancy on the Project, whether or not such improvements are located on or off the Property or on other property subject to the Agreement. Notwithstanding any provision of this Certificate of Completion, the City may enforce any covenant surviving this Certificate of Completion in accordance with the terms and conditions of the Agreement and the City Regulatory Agreement recorded against the Property by the Developer and the City under the Agreement. The Agreement is an official record of the City and a copy of the Agreement may be inspected at the

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EXHIBIT G
G-3

City’s office located at 460 N Euclid Ave, Upland, CA 91786, during the City’s regular business hours.

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EXHIBIT G
G-4

DATED AND ISSUED this _____ day of ______________, 2022.

THE CITY OF UPLAND
a public body corporate and politic

By:

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EXHIBIT G
G-5

___________________________
City Manager

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.

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EXHIBIT G
G-6

EXHIBIT A
TO

CERTIFICATE OF COMPLETION

Legal Description of the Property
Northwest Corner of First Avenue and A Street
UPLAND, CA 91786
APN 1046-591-08, 09, 10, 11, 12, 13

[LEGAL DESCRIPTION]

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EXHIBIT H
H-1

EXHIBIT H
TO

HOUSING DISPOSITION AND DEVELOPMENT AGREEMENT
(HNR-1)

Form of City Regulatory Agreement
[Attached Behind This Page]

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EXHIBIT H
H-2

[To be attached]

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EXHIBIT I
Project Budget

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1 RECORDING

REQUESTED BY

AND WHEN RECORDED
MAIL TO:

City of Upland
460 N Euclid Ave
Upland, California 91786
Attention: City Clerk’s Office

SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY
EXEMPT FROM RECORDING FEES PURSUANT TO GOVT. CODE § 27383 APN(s) _____________________________________

CITY OF UPLAND

REGULATORY AGREEMENT AND DECLARATION OF

AFFORDABLE HOUSING

COVENANTS, CONDITIONS AND RESTRICTIONS
(Northwest Corner of 1st Ave and A St.)

THIS REGULATORY AGREEMENT AND DECLARATION OF AFFORDABLE HOUSING COVENANTS, CONDITIONS AND RESTRICTIONS (this “Declaration”) is dated as of , 2022 (“Effective Date”), and is made and entered into by and between the CITY OF UPLAND, a public body, corporate and politic (“City”), and CITY VENTURES HOMEBUILDING, LLC, a Delaware limited liability company (“Developer”), with reference to the following recited facts (each, a “Recital”).

RECITALS
A. Developer purchased that certain real property specifically described in Exhibit “A” to this Regulatory Agreement (“Property”) from the City of Upland pursuant to the terms of that certain Disposition and Development Agreement (Northwest Corner of 1st Ave and A St.), dated as of _______________, between the City of Upland and Developer (“DDA”); B. The Developer is obligated under the terms of the DDA to construct a residential for-sale townhome community and all required onsite and offsite improvements, including fifteen percent (15%) Affordable Homes (as defined in Section 1 of this Declaration), as more specifically described in the DDA (“Project”), and convey each Affordable Home to a Qualifying Household

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2 (as defined in Section 1 of this Declaration) at the Sales Price Maximum and an Affordable Housing Cost (as defined in Section 1 of this Declaration), all for the purpose of increasing and improving the supply of affordable owner-occupied housing in the City. As of the date of execution of this Declaration, the project is anticipated to include twenty-nine (29) units, of which five (5) would be Affordable Homes;
C. This Declaration is intended, among other purposes, to restrict the use of the Property to affordable housing for Qualifying Households at Affordable Housing Cost as described in this Declaration, until recordation of a final condominium map for the Project (pursuant to Sections 2.2 through 2.4 of this Declaration), after which time this Declaration is intended to only restrict the use of the legal parcels designated for development of the five Affordable Homes until the passage of forty-five (45) years following the date of the original conveyance of the Affordable Homes to Qualifying Households at an Affordable Housing Cost for occupancy by Qualifying Households as their primary residences, but not to restrict the use of the other twenty four (24) New Homes to be constructed on the Property as part of the Project;

NOW, THEREFORE, IN CONSIDERATION OF THE PROMISES, COVENANTS AND

UNDERTAKINGS SET FORTH IN THIS DECLARATION AND FOR OTHER GOOD AND

VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH IS

HEREBY ACKNOWLEDGED, DEVELOPER AND CITY COVENANT, DECLARE AND AGREE FOR THEMSELVES, THEIR SUCCESSORS AND ASSIGNS, AS FOLLOWS:

1. DEFINITIONS. As used in this Declaration, the following words, phrases and terms shall have the meaning as provided in the initial paragraph of this Declaration, in the Recitals or in this Section 1, unless the specific context of usage of a particular word, phrase or term requires otherwise:

1.1 Affordable Home. Each of the separate residential dwelling units in the Project constructed or to be constructed on the Property for sale to Qualifying Households, whether in the form of a single-family residence, town-home, condominium or another form, and the associated legal parcel of the Property on or in which each dwelling unit is located, respectively.

1.2 Affordable Housing Cost. An “affordable housing cost” as defined in Health and Safety Code Section 50052.5 and accompanying regulations of the California Department of Housing and Community Development. The Affordable Housing Cost for the Affordable Homes is attached hereto as Exhibit D, which shows the applicable affordable housing cost under HCD’s State Income Limits together with the City’s Silent Second Loan under its First Time Home Buyer Program to meet the Sales Price Maximum, as defined. The Affordable Housing Cost may be modified from time to time based upon updates to the State Income Limits for Low Income households as established the State’s Housing and Community Development Department, which shall automatically be incorporated herein by reference as an updated Exhibit D.

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3 1.3 Affordability Period. The time period following full occupancy for each of the Affordable Homes following Close of Escrow and ending on the forty-fifth (45th) anniversary of the Completion Date.

1.4 City. The City of Upland, California, a municipal corporation.

1.5 Completion Date. As to each Affordable Home, the first date on which fee title to such Affordable Home is conveyed by Developer to a Qualifying Household at the Sales Price Maximum and an Affordable Housing Cost.

1.6 County. The County of San Bernardino, California.

1.7 Default. Any Monetary Default or Non-Monetary Default.

1.8 Developer Transfer Notice. Defined in Section 2.8.1.

1.9 Event of Default. The occurrence of any one or more of the following:

1.9.1 Monetary Default. A Monetary Default that continues for ten (10) business days after Notice to the defaulting Party from City, specifying in reasonable detail the amount of money not paid and the nature and calculation of each such payment;

1.9.2 Non-Monetary Default. Any Non-Monetary Default that is not cured or protested in writing by the defaulting Party within thirty (30) days after Notice to the defaulting Party from City describing the Non-Monetary Default in reasonable detail, or, in the case of a Non- Monetary Default that cannot with reasonable diligence be cured within thirty (30) days after the effective date of such Notice, if the defaulting Party does not do all of the following: (a) within thirty (30) days after Notice of such Non-Monetary Default, advise City of the intention of the defaulting Party to take all reasonable steps to cure such Non-Monetary Default; (b) duly commence such cure within such period, and then diligently prosecute such cure to completion; and (c) complete such cure within a reasonable time under the circumstances.

1.10 Maintenance Standard. Maintenance of the specified property in good condition and repair, including, without limitation, maintenance, repair, reconstruction and replacement as reasonably necessary of any and all asphalt, concrete, landscaping, utility systems, irrigation systems, drainage facilities or systems, grading, subsidence, retaining walls or similar support structures, foundations, ornamentation, and all other improvements on or to the specified property, now existing or made in the future by or with the consent of the Person specified as having the obligation to maintain the specified propert y, as necessary to maintain the appearance and character of the specified property, including all of the following: (a) maintaining the surfaces in a smooth and evenly covered condition; (b) removing all papers, mud, sand, debris, filth and refuse and sweeping areas to the extent reasonably necessary to keep areas in a clean and orderly condition; (c) removing or covering, as appropriate, graffiti with the type of surface covering originally used on the affected area, (d) installing, operating, keeping in repair and replacing where necessary, such artificial lighting facilities as shall be reasonably required; (e) maintaining, mowing, weeding, trimming and watering all landscaped areas and making such replacements of plants and other landscaping material as necessary to maintain the appearance and character of the landscaping; (f) properly maintaining windows, structural elements, and painted exterior surface

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4 areas of improvements in a clean and presentable manner; (g) keeping outdoor areas free of accumulated debris, appliances, inoperable motor vehicles or motor vehicle parts, or free of storage of lumber, building materials or equipment; (h) parking of any commercial motor vehicle in excess of 10,000 pounds gross weight anywhere at the specified property on other than on a temporary basis; and (i) the use of garage areas for purposes other than the parking of motor vehicles and the storage of personal possessions of the owners or occupants of the specified property.

1.11 Monetary Default. Any failure by Developer to pay or deposit, when and as this Declaration requires, any amount of money, any bond or surety or evidence of any insurance coverage required to be provided under this Declaration, whether to or with the City or a Third Person.

1.12 Non-Monetary Default. Any or all of the following, excepting any such failure constituting a Monetary Default: (a) failure of a Party to perform any of its obligations under this Declaration; (b) failure of a Party to comply with any affirmative or negative covenant or material restriction or prohibition in this Declaration; or (c) occurrence of any other event or circumstance that, with the passage of time or giving of Notice, or both, or neither, would constitute a breach of this Declaration by a Party.

1.13 Notice. Any consent, demand, designation, election, notice, or request relating to this Declaration, including any Notice of Default. All Notices must be in writing.

1.14 Notice of Default. Any Notice claiming or giving Notice of a Default or alleged Default.

1.15 Owner. Each Qualifying Household purchaser of an Affordable Home in compliance with this Declaration.

1.16 Parties. Collectively, City, Developer and, after acquisition of an Affordable Home, such Affordable Home’s Owner.

1.17 Party. Individually, either City, Developer or, after acquisition of an Affordable Home, such Affordable Home’s Owner, as applicable.

1.18 Person. Any association, corporation, governmental entity or agency, individual, joint venture, joint-stock company, limited liability company, partnership, trust, unincorporated organization or other entity of any kind.

1.19 Property. That certain real property located within the City of Upland, County of San Bernardino, State of California, specifically described in the legal descriptions attached as Exhibit “A” to this Declaration, which is incorporated into this Declaration by this reference.

1.20 Purchase Money Deed of Trust. A deed of trust recorded against the Owner’s title to its Affordable Home securing repayment of such Owner’s then current Purchase Money Loan.

1.21 Purchase Money Loan. A loan from a Federal or State chartered bank, savings and loan or credit union to the then current Owner of an Affordable Home, the proceeds of which were entirely used by such Owner to acquire title to the subject Affordable Home.

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5 1.22 Purchase Price. The amount paid by the then current Owner of the subject Affordable Home to acquire title to the Affordable Home from the Developer or the previous Owner of the Affordable Home, plus any associated Sale Costs paid by the then current Owner.

1.23 Qualifying Household. An individual or family with an income above Very Low Income and not exceeding Low Income as published annually for the County by the California Department of Housing and Community Development consistent with the maximum allowable income of persons and families pursuant to Health and Safety Code Section 50093 and associated regulations of the California Department of Housing and Community Development.

1.24 Record, recorded, recording or recordation. Recordation of the referenced document in the official records of the County.

1.25 Resale or Resell. Transfer of an Affordable Home by its Owner.

1.26 Resale Agreement. The agreement between the Qualifying Household and City, which agreement shall incorporate and set forth the Qualifying Household’s obligations to continuously occupy the Affordable Home during the duration of the agreement and Resell it only to another Qualifying Household at the maximum sales price as defined therein. The Resale Agreement shall be substantially in the form attached to this Declaration and incorporated into it as Exhibit “B”, and as may be amended from time to time to conform with any guidelines from state or federal regulatory authorities, including but not limited to HUD, HCD, the U.S.

Department of Veterans Affairs, and the U.S. Federal Housing Administration, or Fannie Mae or Freddie Mac.

1.27 Sale Costs. All of the following related to a Transfer of an Affordable Home: (a) the seller’s portion of any closing costs; (b) the actual cost of necessary health and safety related repairs to the Affordable Home; and (c) costs of obtaining homeowners association documents (if any).

1.28 Sales Price Maximum. The Sales Price Maximum shall be the sales price for each Affordable Home and shall be as set forth in Row 1 of Exhibit D attached hereto.

1.29 Third Person. Any Person that is not a Party, an affiliate of a Party, a relative of a Party or an elected official, officer, director, manager, shareholder, member, principal, partner, employee or agent of a Party.

1.30 Transfer. Regarding any property, right or obligation means any of the following, whether by operation of law or otherwise, whether voluntary or involuntary, and whether direct or indirect, any assignment, conveyance, grant, hypothecation, mortgage, pledge, sale, or other transfer, whether direct or indirect, of all or any part of such property, right or obligation, or of any legal, beneficial, or equitable interest or estate in such property, right or obligation or any part of it (including the grant of any easement, lien, or other encumbrance) or any change in the occupancy of any Property from being occupied by Owner as Owner’s principal residence to being rented by Owner to any other person, exclusive of any of the following (provided that the City has received written notice of such occurrence) relating to the Property: (a) a mere change in form of ownership with no material change in beneficial ownership and such change in ownership is a tax -free transaction under United States income tax law and the State of California real estate transfer tax

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6 law; (b) a conveyance only to member(s) of the immediate family(ies) of the transferor(s) or trusts for their benefit; or (c) a collateral conveyance pursuant to a Purchase Money Deed of Trust.

1.31 Unavoidable Delay. A delay in a Party performing any obligation under this Declaration, arising from or on account of any cause whatsoever beyond the Party’s reasonable control, including strikes, labor troubles or other union activities, casualty, war, acts of terrorism, riots, litigation, governmental action or inaction, regional natural disasters or inability to obtain required materials. Unavoidable Delay shall not include delay caused by a Party’s financial condition, illiquidity, or insolvency.

1.32 Usury Limit. The highest rate of interest, if any, that Law allows under the circumstances.

2. DEVELOPER COVENANTS

2.1 Acknowledgment of Potential Impact of Declaration. Developer acknowledges and agrees that City has informed Developer that this Declaration imposes certain restrictions on the occupancy and resale of the Property, subject to Section 2.2 below, during the Affordability Period, subject to Section 2.2 below. Developer agrees that the City may record this Declaration against the Property in the official records of the County of San Bernardino, California. ____________________
Initials of Authorized
Developer Representative

2.2 Release of Certain Real Property upon Recordation of Final Subdivision Map.

Following recordation of a final map approved by the City for the Project, in accordance with the California Subdivision Map Act (California Government Code Section 66410, et seq.), Developer’s satisfaction of all requirements of the Davis-Stirling Common Interest Development Act (California Civil Code Section 1350, et seq.) to create the Project as a condominium project, as defined in such act, following written request from Developer for such release and as long as Developer is not in Default under this Declaration or the DDA, City shall sign an instrument, in recordable form, releasing those separate interests in the condominium project that are not designated for development of Affordable Homes from the provisions of this Declaration, except the provisions of Sections 2.4 or 2.5 . Notwithstanding any such release of propert y from the obligations of this Declaration, all obligations and liabilities of Developer arising pursuant to this Declaration prior to the time of any such release shall survive and continue following such release, until completely satisfied. The form and substance of any release document shall be subject to the reasonable approval of City. Prior to the City being obligated to make the release described in this Section 2.2, City and Developer shall have agreed on which condominium units within the Project will be designated for development of Affordable Homes.

2.3 Reservation of Property for Affordable Housing. Developer, on behalf of itself and each successor or assign of Developer, covenants and agrees that throughout the Affordability Period each Affordable Home, as designated under this Declaration, shall be reserved and restricted for ownership and residential use and occupancy as the primary residence of a Qualifying Household at the Sales Price Maximum and an Affordable Housing Cost. Each Qualifying

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7 Household shall execute and record a Resale Agreement substantially in the form attached hereto as Exhibit B which shall specify that (a) the Owner shall not lease, sublease or rent all or any portion of the Affordable Home to any Person, except as expressly provided in the Resale Agreement; (b) the Owner shall not Transfer all or any portion the Affordable Home to any Person who is not a Qualifying Household; (c) the Owner shall not Transfer all or any portion of the Affordable Home to a Qualifying Household for more than an Affordable Housing Cost for such Qualifying Household; (d) the Owner shall not Transfer all or any portion of the Affordable Home to a Qualifying Household for a use other than such Qualifying Household’s primary residence, and (e) the Owner shall not Transfer all or any portion of the Affordable Home to a Qualifying Household unless such Qualifying Household shall execute and record a new Resale Agreement.

2.4 Developer Covenant Regarding No Discrimination or Segregation. Developer covenants by and for Developer and any successor in interest that there shall be no discrimination against or segregation of any Person or group of Persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the Developer or successor in interest 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, sub-tenants, sub- lessee, or vendees in the Property. The foregoing covenants shall run with the land; provided, however, that in no event shall any Owner be considered a successor in interest to Developer within the meaning of this paragraph. Notwithstanding the first sentence of this Section 2.4, with respect to familial status, this Section 2.4 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in this Section 2.4 shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code shall apply to this Section 2.4.

2.5 City Right to Inspect Property. Officers, employees, agents and representatives of the City shall have the right of reasonable access to the Property, without the payment of charges or fees, during normal construction hours, during the period of construction of the Project. Such officers, employees, agents or representatives of the City shall be those persons who are designated by the City Manager. Any and all officers, employees, agents or representatives of the City who enter the Property shall identify themselves at the construction management office on the Property, upon their entrance on to the Property, and shall at all times be accompanied by a representative of the Developer, while on the Property. The Developer shall make a representative of the Developer available for this purpose at all times during normal construction hours, upon reasonable notice from the City. The City shall indemnify and hold the Developer harmless from injury, property damage or liability arising out of the exercise by the City of the right of access to the Property provided in this Section 2.5, other than injury, property damage or liability arising from the negligence or willful misconduct of the Developer or its officers, agents or employees.

The City shall inspect relevant portions of the Property, prior to issuing any written statements reflecting adversely on the Developer’s compliance with the terms and conditions of this Agreement pertaining to development of the Project. If in the City’s reasonable judgment it is necessary, the City shall have the further right, from time to time, to ret ain a consultant or consultants to inspect the Project and verify compliance by the Developer with the provisions of this Agreement. The Developer acknowledges and agrees that any such inspections are for the sole

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8 purpose of protecting the City’s rights under this Agreement, are made solely for the City’s benefit, that the inspections may be superficial and general in nature, and are for the purposes of informing the City of the progress of the Project and the conformity of the Project with the terms and conditions of this Agreement, and that the Developer shall not be entitled to rely on any such inspection(s) as constituting an approval, satisfaction or acceptance of any materials, workmanship, conformity of the Project with this Declaration or otherwise. The Developer agrees to make its own regular inspections of the work of construction of the Project to determine that the quality of the Project and all other requirements of the work of construction of the Project are being performed in a manner satisfactory to the Developer. The Developer also agrees to immediately notify the City in writing should the Developer’s inspections show any matters that will prevent the entire Project from being completed by the Project Completion Date set forth therefor in the Schedule of Performance as those terms are defined in the DDA. Without limiting the foregoing, the Developer shall permit the City upon reasonable notice to examine and copy all books and account records and other papers relating to the Property and the construction of the Project. The Developer will use commercially reasonable efforts to cause all contractors, subcontractors and materialmen to cooperate with the City to enable such examination..

2.6 Formation of Homeowners Association. Developer shall establish a homeowners association (“HOA”) for the purpose of maintaining the common areas of the Property in compliance with the Maintenance Standard. The HOA shall include the owners of each and every one of the homes on the Property, including each Owner of an Affordable Home. The HOA shall be incorporated as a nonprofit mutual benefit corporation. The HOA shall establish covenants, conditions, and restrictions (“CC&Rs”) applicable to the Project. Prior to recordation, Developer shall provide the CC&Rs to the City Attorney for review and approval to determine the CC&R’s adequacy to meet the obligation of this Section 2.6, which approval shall not be unreasonably withheld, conditioned, or delayed. Consistent with standard conditions of approval, Developer shall be responsible for maintaining the Property in a clean and orderly manner during construction activities and meeting the required Maintenance Standard following construction activities until the establishment of the HOA and City Attorney’s approval of the HOA’s CC&Rs takes effect.

2.7 First Sale of Completed Affordable Homes by Developer.

2.7.1 City Notice. Developer, for itself, its successors and assigns, hereby covenants and agrees that Developer shall not Transfer an Affordable Home (or any interest in an Affordable Home), without first giving Notice to City (each, a “Developer Transfer Notice”) and obtaining the written concurrence of City that the proposed Transfer complies with this Declaration. Within fifteen (15) days following the receipt of a Developer Transfer Notice, City shall deliver to Developer a written concurrence or objection to the Transfer of the Affordable Home. If City does not provide a written concurrence or objection to the Transfer within fifteen (15) business days, the City shall be deemed to concur with the Transfer. Each Developer Transfer Notice shall include all of the following information:
(a) the identity of the proposed Qualifying Household (“First Purchaser”), including the identity of all persons in the household of the proposed First Purchaser proposing to reside in the Affordable Home;

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9 (b) documentation of household income of the proposed First Purchaser, substantially in the form attached hereto as Exhibit C, which may include any of the following documentation as may be appropriate: (1) copies of filed Federal and State income tax returns and copy of each W2 Wage and Earnings Statement for the three (3) most recently concluded income tax years for each adult Person in the Owner’s household; (2) an income verification form from the current employer(s) of all employed adult Persons in the Owner’s Household; (3) an income verification form from the United States Social Security Administration or the California Department of Social Services for each Person in the Owner’s household who receives assistance from either of such agencies (if any); or (4) for each adult Person in the Owner’s household who is unemployed or has no such income tax return, another form of independent income verification.
(c) the proposed sale price of the Affordable Home payable by the proposed First Purchaser, including the terms of the Purchase Money Loan to be obtained by the proposed First Purchaser and the estimated amount of Sale Costs, real estate broker fees and other costs or charges payable by the proposed First Purchaser to acquire ownership of the Affordable Home;
(d) the name, address, and telephone number of the escrow agent proposed to conduct the escrow for the Transfer of the Affordable Home from Developer to the proposed First Purchaser; and
(e) a written acknowledgment and agreement from the proposed First Purchaser for the benefit of City that the ownership and occupancy of the subject Affordable Home is subject to this Declaration;

2.7.2 First Purchaser Qualifications. Developer acknowledges and agrees that, in accordance with Section 2.3, each proposed First Purchaser of an Affordable Home must be a Qualifying Household, the sale price of an Affordable Home to a First Purchaser must be the Sales Price Maximum listed in Row 1 of Exhibit D, as may be modified from time to time based upon updates to the State Income Limits for Low Income households as established the State’s Housing and Community Development Department, which is calculated to be an Affordable Housing Cost for such First Purchaser, with the City Silent Second Loan to make up the difference between the First Purchaser’s financial capability and that Sales Price Maximum, as described below and in Exhibit D, and the First Purchaser must execute and record a Resale Agreement requiring that the First Purchaser occupy the Affordable Home as its principal residence. The City may use another lawful funding source besides CalHOME if necessary to fund the required City Silent Second Loan commitment. In the event that there are differences between assumed costs in Exhibit D and actual costs at the time of first purchase or the Affordable Housing Cost of a First Purchaser is lower than the assumed Affordable Housing Cost in Exhibit D, City agrees to increase the City Silent Second Loan as provided in Exhibit D attached hereto, in an amount sufficient to allow First Purchaser to purchase the Affordable Home at the Sales Price Maximum and the Affordable Housing Cost subject to the availability of CalHOME funding or alternative funding sources The City recognizes that Developer shall not be obligated to proceed with a sale for less than the amount identified as the Sales Price Maximum on Line 1 of Exhibit D, regardless of availability of additional funding for increased City Silent Second Loan. Developer further agrees that in accordance with Section 2.7.1, City shall have the right and reasonable opportunity, prior

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10 to each conveyance of an Affordable Home to a First Purchaser, to verify that each proposed sale of the Affordable Home will be to a Qualifying Household at the Sales Price Maximum, at an Affordable Housing Cost for such Qualifying Household, and that the First Purchaser intends to occupy the Affordable Home as its principal residence after acquiring title to the Affordable Home.

City agrees that Developer may rely in good faith upon applicant-submitted information to determine whether proposed First Purchasers are Qualifying Households, and Developer shall not incur any liability under this Declaration as a result of fraud, mistake, or misrepresentation (intentional or unintentional) by a proposed First Purchaser. Notwithstanding the foregoing, Developer will use commercially reasonable efforts to review and verify whether First Purchasers are Qualifying Households.

2.7.3 Effect of First Sale on Developer Obligations. Upon conveyance of an Affordable Home to a First Purchaser and execution and recordation of a Resale Agreement on the Affordable Home in compliance with this Declaration, Developer’s obligations under this Declaration shall be satisfied regarding the subject Affordable Home, this Declaration shall terminate as to the Affordable Home, and the Affordable Home shall be subject to terms of the Resale Agreement. No additional documentation shall be required to effectuate such termination, however upon written request from Developer for such release, City shall sign an instrument, in recordable form, memorializing the release of the Affordable Home from the provisions of this Declaration. The form and substance of the release document shall be subject to the reasonable approval of City.

2.7.4 Effect of Sale of All Affordable Homes on Developer Obligations.

Upon conveyance of the Affordable Homes to First Purchasers and recordation of Resale Agreements on the Affordable Homes in compliance with this Declaration, Developer’s obligation to provide Affordable Homes under this Declaration and the DDA shall be fully satisfied, this Declaration shall terminate, and the Affordable Homes shall be subject to the Resale Agreements.

No additional documentation shall be required to effectuate such termination, however following sale of all Affordable Homes and recordation of the Resale Agreements consistent with the requirements of this Declaration, and upon written request from Developer for such termination, City shall sign an instrument, in recordable form, memorializing termination of this Declaration.

The form and substance of the termination document shall be subject to the reasonable approval of City.

2.7.5 Alternative Sale Option. In the event that, one hundred and eighty (180) days after the sale of the final market rate unit, Developer has been unable to sell some or all of the Affordable Homes to Qualifying Households after using commercially reasonable efforts, as set forth herein, City shall purchase any remaining unsold Affordable Homes (up to and not more than two (2) Affordable Homes) from Developer at the Sales Price Maximum listed in Exhibit D for use as affordable housing (an “Alternative Affordable Sale”). Under the Alternative Affordable Sale, City shall ensure that the Affordable Home remains restricted for occupancy by a Qualifying Household for a term consistent with the requirements of the Surplus Lands Act (Gov. Code § 54220 et seq.).

For the purposes of an Alternative Affordable Sale, commercially reasonable efforts shall include the following: listing the Affordable Home on the Multiple Listing Service (“MLS”); reasonable cooperation with any City efforts to market the Affordable Home; newspaper and radio

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11 advertisements to publicize the availability of the Affordable Homes; a website marketing the Affordable Homes and the criteria used to purchase them, as well as a form for interested parties to complete online indicating their interest in being notified about the availability of the units ; production of specific marketing information highlighting the Affordable Homes, including the specific affordability features for each unit and the eligibility requirements and restrictions on each unit; outreach that includes contacting nonprofit organizations and business associations that serve City residents in housing related issues, and affordable housing advocacy groups, that are identified by City and provided by City to Developer in writing; directly contacting households that meet the eligibility requirements for Qualifying Households and have provided their contact information on an interested parties list and that are identified by City and provided by City to Developer in writing; and availability of a sales manager with walk-throughs of the Affordable Homes.

It is understood that Developer will not be obligated, but may at any time in its sole discretion, sell an Affordable Home to a Qualifying Household for a price less than that shown as the Sales Price Maximum in Exhibit D.

Notwithstanding anything to the contrary herein, an Alternative Affordable Sale shall satisfy Developer’s obligation to provide that Affordable Home under this Declaration and the DDA, and this Declaration shall terminate as to that Affordable Home as provided under this Section 2.7.

3. EXHIBITS. The following exhibits are attached hereto and made a part of this Declaration by this reference:

Exhibit A Property Legal Description
Exhibit B Form of Resale Agreement
Exhibit C Form of Income Certification
Exhibit D Affordable Housing Cost

4. COVENANTS RUN WITH THE LAND. The Parties hereby declare their mutual specific intent that the covenants, conditions, restrictions, reservations and agreements set forth in this Declaration are part of a plan for the promotion and preservation of affordable housing within the territorial jurisdiction of the City and that, except as otherwise provided in Section 2.2 , 2.7.3, and 2.7.4, each shall be deemed covenants running with the land of the Property and each Affordable Home, binding upon each successor-in-interest of Developer, including each Owner, for the duration of the Affordability Period. Regardless of classification or characterization, each of the covenants, conditions, restrictions and agreements contained in this Declaration touch and concern the land of the Property and each Affordable Home, and each of them is expressly declared to be for the benefit and in favor of the City for the duration of the Affordability Period, regardless of whether or not the City is or remains an owner of any land or interest in land to which such covenants, conditions, restrictions or agreements relate. The City, in the event of any Default or breach of this Declaration, has the right to exercise all of the rights and remedies, and to maintain any actions at law or suits in equity or other proper proceedings, to enforce the curing of such Default or breach, as provided in this Declaration, at law or in equity. Each and every contract, deed or other instrument hereafter executed covering or conveying all or any portion of or any interest in the Property or an Affordable Home shall incorporate all of the provisions of this Declaration, either expressly or by reference, and any contract, deed or other instrument

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12 transferring any estate or interest in an Affordable Home, shall conclusively be deemed to have been executed, delivered and accepted subject to the agreements, covenants, conditions, reservations, and restrictions of this Declaration, regardless of whether such agreements, covenants, conditions, reservations and restrictions are set forth in or referenced such contract, deed or other instrument.

5. AGENCY REMEDIES. If an Event of Default occurs, the City shall have the right to exercise any or all of the remedies described in this Section 5, all cumulative (so exercise of one remedy shall not preclude exercise of another remedy), in addition to such other remedies as may be available at law or in equity, under any other provisions of this Declaration or pursuant to the City Grant Deed or the DDA.

5.1 Suits Before End of Affordability Period. The City may sue the defaulting Party for damages or other relief, from time to time, at the City’s election, without terminating this Declaration, including by mandamus or other suit, action or proceeding at law or in equity, to require the defaulting Party to perform the covenants or agreements or observe the conditions or restrictions of this Declaration, or enjoin any acts or things that may be unlawful or in violation of the rights of the City under this Declaration; or by other action at law or in equity, as necessary or convenient to enforce the covenants, agreements, conditions or restrictions of this Declaration.

5.2 Receipt of Moneys. No receipt of money by the City from any Person after any Notice of Default to a Party shall affect any Notice previously given to such Party, or waive the City’s right to enforce payment or deposit of any amount payable or later falling due, or the City’s right to enter the Property or an Affordable Home.

5.3 No Waiver. No failure by a Party to insist upon strict performance of any condition, covenant, agreement, restriction or reservation of this Declaration or to exercise any right or remedy upon a Default and no acceptance of full or partial payment of any amount due or becoming due to the Party during the continuance of any such Default shall waive any such Default or such condition, covenant, agreement, restriction or reservation. No obligation of a Party under this Declaration shall be modified and no Default, shall be waived, except by a written instrument signed by the Parties. No waiver of any Default shall modify this Declaration. Each and every covenant, agreement, condition, restriction and reservation of this Declaration shall continue in full force and effect with respect to any other then-existing or subsequent Default of such condition, covenant, agreement, restriction or reservation of this Declaration.

5.4 Damages. Each Party may recover from each other Party all damages the Party incurs by reason of such other Party’s Default and reimbursement reasonable out of pocket costs including attorney fees. Each Party may recover such damages at any time after another Party’s Default, including after the expiration of the Affordability Period subject to any limits on damages within the DDA, which shall survive termination. Notwithstanding any applicable law to the contrary, each Party need not commence separate actions to enforce another Party’s obligations for each amount or payment not paid, or each month’s accrual of damages and costs for the other Party’s Default, but may bring and prosecute a single combined action for all such damages and costs.

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13 5.5 Injunction of Breaches. Whether or not an Event of Default has occurred, a Party may obtain a court order enjoining each other Party from continuing any Default or from committing any threatened Default.

5.6 Enforcement. Developer agrees that their respective non-monetary obligations under this Declaration is one of the reasons that the City entered into this Declaration. Therefore, City may be entitled to withhold, condition, suspend, or revoke any permit, license or other entitlement for the Property, including without limitation final inspections for occupancy and/or certificates of occupancy for the Property as a consequence of a Default by Developer under this Declaration, in addition to such other remedies available in law or equity to City.

5.7 City Enforcement. The City shall have the power to enforce this Declaration and no other Person shall have any right or power to enforce any provision of this Declaration on behalf of the City or the City or to compel the City or the City to enforce any provision of this Declaration against Developer, Owner or the Affordable Homes, except to the extent required or authorized by Health and Safety Code Section 33334.3(f)(7).

6. INDEMNITY
Developer hereby agrees to indemnify, defend, and hold harmless the City, its respective employees, officers, and agents (“Indemnified Parties”) from any and all losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including but not limited to reasonable attorneys’ fees) (“Claims”) which arise out of or in connection with (1) Developer's operation, maintenance, or marketing of the Affordable Homes; (2) Developer’s failure to perform its obligations under this Declaration as and when required herein; or (3) any act or omission by Developer or any contractor, subcontractor, architect, engineer, consultant or supplier of Developer with respect to Developer's performance of its obligations under the Declaration or otherwise imposed by law, except to the extent that the loss is caused by the sole, active negligence or willful act or omission of the Indemnified Parties. Developer shall pay within thirty (30) days upon the Indemnified Party’s demand any amounts owing under this indemnity provision. The duty of Developer to indemnify includes the duly to defend the Indemnified Party in any court action, administrative action, or other proceeding brought by any third party arising from a Claim, with counsel reasonably acceptable to the Indemnified Party.

7. INSURANCE
In order to protect the City and its commissions, agents, attorneys, officers, employees and authorized representatives (collectively, “Additional Insureds”) against any and all claims and liability for death, injury, loss and damage resulting from the Developer’s actions in connection with this Declaration, the Property, and the Project, the Developer shall secure and maintain the insurance coverage, described in and required by this Section 7. The City shall not have any obligation under this Agreement until the Developer provides the required policies and/or certificates evidencing the insurance required by this Section 7 to the City and the City approves such evidence of insurance. The Developer shall pay any deductibles and self-insured retentions

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14 under all insurance policies issued in satisfaction of the terms of this Agreement. Developer shall retain all insurance policies as set forth in this Section 7 until recordation of the Certificate of Completion, as that term is defined in the DDA. Developer shall maintain in full force and effect from the Effective Date until the issuance of the Certificate of Completion, subject to 5.2.4, the following insurance coverage:

7.2.1.1 Commercial General Liability Insurance coverage, including, but not limited to, Premises-Operations, Contractual Liability Insurance (specifically covering all indemnity obligations of the Developer pursuant to this Declaration), Products-Completed Operations Hazards, Personal Injury (including bodily injury and death), and Property Damage for liability arising out of the construction of the Project and/or the Developer’s operations concerning the Property or the Project. The commercial general liability insurance coverage shall have minimum limits for Bodily Injury and Property Damage liability of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate.

7.2.1.2 Automobile Liability Insurance against claims of Personal Injury (including bodily injury and death) and Property Damage covering all owned, leased, hired and non-owned vehicles used by the Developer with minimum limits for Bodily Injury and Property Damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and ONE MILLION DOLLARS ($1,000,000) aggregate. Such insurance shall be provided by a business or commercial vehicle policy.

7.2.1.3 If the Developer hires a consultant to provide design services, such as architectural or engineering services in connection with the Project, or any portion of the Project, the Developer shall require each such consultant to provide Professional Liability (Errors and Omissions) Insurance, for liability arising out of, or in connection with, the performance of such design services, with limits of not less than ONE MILLION DOLLARS ($1,000,000).

7.2.1.4 Upon acceptance of the Project or any portion thereof, from each contractor, the Developer shall maintain Fire and Extended Coverage Insurance, excluding earthquake coverage, on the Project on a blanket basis or with an agreed amount clause in amounts not less than 100% of the replacement value of all portions of the Project so accepted.

7.2.2 During the construction of the Project, the Developer shall require that each contractor performing work on the Project maintain the following insurance coverage, as specified below, at all times during the performance of said work, or the Developer shall provide for such contractors “wrap” coverage, as specified below, at all times during the performance of said work:

7.2.2.1 The Developer shall maintain Builder’s Risk Insurance to be written on an All Risk Completed Value form, in an aggregate amount equal to 100% of the completed insurable value of the Project or portion of the Project on which such contractor is performing work.

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15 7.2.2.2 Each general contractor and, unless covered under the general contractor’s policy, each sub-contractor shall maintain Commercial General Liability Insurance with limits of not less than ONE MILLION DOLLARS ($1,000,000) per occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate to protect the Developer during the construction of the Project from claims involving bodily injury and/or death and damage to the property of others.

7.2.2.3 Each general contractor and each sub-contractor shall maintain Automobile Liability Insurance against claims of personal injury (including bodily injury and death) and property damage covering all owned, leased, hired and non -owned vehicles used in the performance of the contractor’s obligations with minimum limits for bodily injury and property damage of ONE MILLION DOLLARS ($1,000,000) each occurrence and TWO MILLION DOLLARS ($2,000,000) aggregate in the case of each general contractor and ONE MILLION DOLLARS ($1,000,000) combined single limit in the case of each subcontractor. Such automobile liability insurance shall be provided by a business or commercial vehicle policy.

7.2.3. The insurance required in Section 7.2.1.1 above and 7.2.1.2 above but, as to Section

7.2.1.2 only with respect to policies maintained by each general contractor, shall include endorsements naming the Additional Insureds as additional insured for liability arising out of this Declaration and any operation related to this Declaration.

7.2.4 Any insurance coverage required under this Declaration shall not be written on a “claims made” basis. The applicable certificate of insurance must clearly provide that the coverage is on an “occurrence” basis. The requirements of this Section 7.2.4 shall survive any expiration or termination of this Declaration and the recordation of the Grant Deed and any Certificate of Completion.

7.2.5 Receipt by the City of evidence of insurance that does not comply with the above requirements shall not constitute a waiver of the insurance requirements of this Declaration.

7.2.6 Subject to Section 7.2.4, all of the insurance coverage required under this Section shall be maintained by the Developer or its contractors, as required by the terms of this Agreement, until the issuance of the Certificate of Completion and shall not be canceled without, at least, thirty (30) days prior written notice to the City. Also, phrases such as “endeavor to” and “but failure to mail such notice shall impose no obligation or liability of any kind upon the company” shall not be included in the cancellation wording of any certificates of insurance or any coverage for the Additional Insureds. The Developer shall immediately obtain replacement coverage for any insurance policy that is terminated, canceled, non -renewed, or whose policy limits are exhausted or upon insolvency of the insurer that issued the policy.

7.2.7 All insurance to be obtained and maintained by the Developer under this Section

5.4 shall be issued by a company or companies listed in the then current “Best’s Key Rating Guide”

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16 publication with a minimum of an “A:VII” rating and be admitted to conduct business in the State of California by the State of California Department of Insurance.

7.2.8 The City will not accept self-insurance in satisfaction of the insurance requirements of this Section 7.

7.2.9 All insurance obtained and maintained by the Developer in satisfaction of the requirements of this Agreement shall be primary to and not contributing to any insurance maintained by the Additional Insureds.

7.2.10 Insurance coverage in the minimum amounts set forth in this Section 7 shall not be construed to relieve the Developer of any liability, whether within, outside, or in excess of such coverage, and regardless of solvency or insolvency of the insurer that issues the coverage; nor shall it preclude the Additional Insureds from taking such other actions as are available to them under any other provision of this Agreement or otherwise at law.

7.3 Failure by the Developer to maintain all insurance coverage required by this Section 7 in effect shall be an Event of Default by the Developer. The City, at its sole option, may exercise any remedy available to them in connection with such an Event of Default. Alternatively, the City may, at its sole option, purchase any such required insurance coverage and the C ity shall be entitled to immediate payment from the Developer for any premiums and associated costs paid by the City for such insurance coverage. Any election by the City to purchase or not to purchase insurance otherwise required to be carried by the Developer shall not relieve the Developer of its obligation to obtain and maintain the insurance coverage required by this Declaration.

8. GENERAL PROVISIONS

8.1 Relationship of Parties. Nothing contained in this Declaration shall be interpreted or understood by any of the Parties, or by any Third Person, as creating the relationship of employer and employee, principal and agent, limited or general partnership, or joint venture between or among City, Developer or any Owner.

8.2 Governing Law. This Declaration shall be governed by the substantive and procedural laws of the State of California, without application of conflicts or choice of laws principles.

8.3 Amendment. This Declaration may be amended only by a written instrument signed by City and each other Party then owning an estate in property then subject to this Declaration.

8.4 Principles of Interpretation. No inference in favor of or against any Party shall be drawn from the fact that such Party has drafted any part of this Declaration. The Parties have participated substantially in the negotiation, drafting, and revision of this Declaration, with advice from counsel and other advisers of their own selection. A term defined in the singular in this Declaration may be used in the plural, and vice versa, all in accordance with ordinary principles

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17 of English grammar, which govern all language in this Declaration. The words “include” and “including” in this Declaration shall be construed to be followed by the words: “without limitation.” Each collective noun in this Declaration shall be interpreted as if followed by the words “(or any part of it),” except where the context clearly requires otherwise. Every reference to any document, including this Declaration, refers to such document as modified from time to time, and includes all exhibits, schedules, and riders to such document. Every reference to a law, statute, regulation, order, form or similar governmental requirement refers to each such requirement as amended, modified, renumbered, superseded or succeeded, from time to time.

8.5 Attorney’s Fees. In the event that a Party brings an action to enforce this Declaration or otherwise arising out of this Declaration, the prevailing Party in such action shall be entitled to recover from the other Party reasonable attorney fees to be fixed by the court in which a judgment is entered, as well as the costs of such suit. For the purposes of this Declaration, the words “reasonable attorney fees” in the case of the City, include the salaries, costs and overhead of the lawyers employed in the Office of the City Attorney of the City who are legal counsel to the City in such an action, as allocated on an hourly basis.

8.6 Severability. If any term or provision of this Declaration or its application to any Person, property or circumstance shall to any extent be invalid or unenforceable, then the remainder of this Declaration, or the application of such term or provision to Persons, properties or circumstances, other than those as to which it is invalid or unenforceable, shall not be affected by such invalidity. All remaining provisions of this Declaration shall be valid and be enforced to the fullest extent applicable law allows.

8.7 Time is of the Essence. Time is of the essence with respect to the performance of each term, provision, covenant, condition, restriction, reservation or agreement contained in this Declaration.

8.8 Unavoidable Delay; Extension of Time of Performance. Performance by a Party under this Declaration shall not be deemed or considered to be in Default, where any such Default is due to the occurrence of an Unavoidable Delay.

8.9 Titles and Headings for Reference Only. The titles and headings of the articles, paragraphs or sections of this Declaration are for convenience and reference only and are not to be considered a part of this Declaration and shall not in any way interpret, modify or restrict the meaning of any term, provision, covenant, condition, restriction, reservation or agreement contained in this Declaration.

8.10 Notices.

8.10.1 Delivery. Any and all Notices sent by a Party to another Party pursuant to or as required by this Declaration shall be proper, if in writing and transmitted to the address of the recipient Party designated in Section 8.10.2, by one or more of the following methods: (a) messenger for immediate personal delivery; (b) a nationally recognized overnight (one Business Day) delivery service (i.e., Federal Express, United Parcel Service, etc.); or (c) registered or certified United States mail, postage prepaid, return receipt requested. Such Notices may be sent in the same manner to such other address as a Party may from time to time designate by Notice, in

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18 accordance with this Section 8.10. Any such Notice shall be deemed to be received by the addressee, regardless of whether or when any return receipt is received by the sender or the date set forth on such return receipt, on the day that it is delivered by personal delivery, on the date of delivery by a nationally recognized overnight courier service or three (3) calendar days after it is placed in the United States mail, as provided in this Section 8.10. Rejection, other refusal to accept or the inability to deliver a Notice because of a changed address of which no notice was given, shall be deemed receipt of the Notice. Any attorney representing a Party may give any Notice on behalf of such Party.

8.10.2 Addresses. The following are the authorized addresses for the submission of Notices to the Parties, as of the Effective Date:

To City:

City of Upland
460 N Euclid Ave
Upland, California 91786

Attention: City Manager

To Developer:

And:

City Ventures Homebuilding, LLC
444 Spear St., Ste. 200
San Francisco, CA 94105
Attn: Philip Kerr

City Ventures Homebuilding, LLC
3121 Michelson Dr., Ste. 150
Irvine, California 92612
Attn: Michelle Thrakulchavee

8.10.3 Entire Agreement. This Declaration may be signed in counterpart originals, each of which shall be deemed to be an original, and all of which together shall constitute one and the same instrument. This Declaration includes fourteen (14) pages and two (2) exhibits.

This Declaration and the DDA constitute the entire understanding and integrate all of the terms, conditions, covenants, restrictions, reservations, terms, provisions and agreements of the Parties regarding the Property and each Affordable Home and supersede all negotiations or previous agreements between the Parties with respect to each Affordable Home. None of the terms, conditions, covenants, restrictions, reservations, terms, provisions or agreements set forth in this Declaration or the DDA shall be deemed to be merged with any deed conveying title to any estate or interest in the Property or an Affordable Home

8.11 Financing Cooperation. The City acknowledges that Developer intends to fund the construction of the Project from its revolving $325,000,000.00 line of credit from Wells Fargo Bank, (together with any other lender providing such financing, “Lender”) in which case no construction financing documents will encumber the Property. Notwithstanding the forgoing, the City agrees to reasonably cooperate with Developer and Lender and to execute such other and

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19 further documents as may be reasonably requested by Lender in order to protect the rights, interests and remedies of Lender; provided that such documents expressly acknowledge and agree that the security interests of Lender shall, at all times, be subject to the security interests of the City with respect to the Affordable Homes.

8.12 Term. The requirements of this Declaration will apply for a period of forty-five (45) years from the date of occupancy of all of the Affordable Homes following Close of Escrow, unless terminated earlier including pursuant to Sections 2.2, 2.7.3, or 2.7.4 above. [Signatures on following page]

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20 SIGNATURE PAGE
TO

REGULATORY AGREEMENT AND DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
(Northwest Corner of 1st Ave and A St.)
IN WITNESS WHEREOF, City and Developer have caused this Declaration to be signed or on their behalf by their duly authorized representatives, as set forth below:

CITY:

THE CITY OF UPLAND, a
California public body,
corporate and politic

By:

DEVELOPER:

CITY VENTURES HOMEBUILDING, LLC,
a Delaware limited liability company

By: City Ventures Communities, LLC, a
Delaware limited liability company, its
sole member

By:

Name:

Its:

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1 EXHIBIT “A”
TO

REGULATORY AGREEMENT AND DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
(Northwest Corner of 1st Ave and A St.)
Property Legal Description

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF UPLAND IN

THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

PARCEL 1:

LOTS 6 TO 13, INCLUSIVE, BLOCK 49, TOWN OF MAGNOLIA, IN THE CITY OF

UPLAND, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 9 OF MAPS, PAGE 15, RECORDS OF SAID COUNTY.

TOGETHER WITH THAT PORTION OF THE VACATED ALLEY LYING ADJACENT TO SAID LAND ON THE SOUTH, AS VACATED BY RESOLUTION NO. 3465 OF THE CITY COUNCIL OF THE CITY OF UPLAND, RECORDED AUGUST 21, 1984, AS INSTRUMENT NO. 84-199409, OFFICIAL RECORDS.

PARCEL 2:

THE NORTH 40 FEET OF LOTS 14 TO 20, INCLUSIVE, BLOCK 49, TOWN OF MAGNOLIA,

IN THE CITY OF UPLAND, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 9, PAGE 15 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

TOGETHER WITH THE SOUTH 1/2 OF THAT CERTAIN ALLEY LYING NORTH OF LOTS 14 TO 20, INCLUSIVE, AS VACATED BY RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UPLAND, RESOLUTION NO. 3465, A CERTIFIED COPY OF WHICH WAS RECORDED AUGUST 21, 1984, AS INSTRUMENT NO. 84-199409, OFFICIAL RECORDS.

PARCEL 3:

PORTION OF LOTS 14, 15, 16, 17, 18, 19 AND 20, BLOCK 49 OF MAGNOLIA, IN THE CITY

OF UPLAND, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT

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2 RECORDED IN BOOK 9, PAGE 15 OF MAPS, RECORDS OF SAID COUNTY, DESCRIBED AS FOLLOWS:

BEGINNING AT A POINT IN THE EAST LINE OF LOT 14, 40 FEET SOUTH OF THE NORTHEAST CORNER OF SAID LOT; THENCE SOUTH ALONG THE EAST LINE OF SAID LOT, 40 FEET TO A POINT 40 FEET NORTH OF THE SOUTHEAST CORNER OF SAID LOT; THENCE WEST 140 FEET TO A POINT IN THE WEST LINE OF LOT 20 OF SAID BLOCK, 40 FEET NORTH OF THE SOUTHWEST CORNER OF SAID LOT 20; THENCE NORTH ALONG THE WEST LINE OF SAID LOT 20, 40 FEET TO A POINT 40 FEET SOUTH OF THE NORTHWEST CORNER OF SAID LOT; THENCE EAST 140 FEET TO THE POINT OF BEGINNING.

PARCEL 4:

THE SOUTH 40 FEET OF LOTS 14 TO 20, INCLUSIVE, BLOCK 49, TOWN OF MAGNOLIA,

IN THE CITY OF UPLAND, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, AS PER PLAT RECORDED IN BOOK 9, PAGE 15 OF MAPS, RECORDS OF SAID COUNTY.

APN: 1046-591-08-0-000, 1046-591-09-0-000, 1046-591-10-0-000, 1046-591-11- 0-000, 1046-591-12-0-000 AND 1046-591-13-0-000

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1 EXHIBIT “B”
TO

REGULATORY AGREEMENT AND DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
(Northwest Corner of 1st Ave and A St.)
Form of Resale Agreement

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1 RECORDING

REQUESTED BY

AND WHEN RECORDED
MAIL TO:

City of Upland
460 N Euclid Ave
Upland, California 91786
Attention: City Clerk’s Office

SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY
EXEMPT FROM RECORDING FEES PURSUANT TO GOVT. CODE § 27383 APN(s) _____________________________________

CITY OF UPLAND

RESALE RESTRICTION AGREEMENT AND

DECLARATION OF AFFORDABLE HOUSING

COVENANTS, CONDITIONS AND RESTRICTIONS
(_________________[Address of Unit])

THIS RESALE RESTRICTION AGREEMENT AND DECLARATION OF
AFFORDABLE HOUSING COVENANTS, CONDITIONS AND RESTRICTIONS (this “Declaration”) is dated as of , 2022 (“Effective Date”), and is made and entered into by and between the CITY OF UPLAND, a public body, corporate and politic (“City”), and __________________________________ [Name of person(s) purchasing unit] (“Owner”), with reference to the following recited facts (each, a “Recital”).

RECITALS
A. Owner purchased that certain real property specifically described in Exhibit “A” to this Declaration (“Property”) which is located in the subdivision at Northwest Corner of 1st Ave and A St. in the City of Upland (“Project”);
B. The City required the developer of the Project (“Developer”) in which the Property is located to construct 15% of all total units (anticipated to be five (5) Affordable Homes, as defined in Section 1 of this Declaration), and convey each Affordable Home to a Qualifying Household (as defined in Section 1 of this Declaration) at an Affordable Housing Cost (as defined in Section 1 of this Declaration), all for the purpose of increasing and improving the supply of affordable owner-occupied housing in the City;

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2 C. The Property is one of the Affordable Homes described in Recital B, and t his Declaration is intended, among other purposes, to restrict the use of the Property to affordable housing for Qualifying Households at Affordable Housing Cost and for occupancy by Qualifying Households as their primary residence until the end of the Affordability Period of forty-five (45) years;

NOW, THEREFORE, IN CONSIDERATION OF THE PROMISES, COVENANTS AND

UNDERTAKINGS SET FORTH IN THIS DECLARATION AND FOR OTHER GOOD AND

VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH IS

HEREBY ACKNOWLEDGED, OWNER AND CITY COVENANT, DECLARE AND AGREE FOR THEMSELVES, THEIR SUCCESSORS AND ASSIGNS, AS FOLLOWS:

1. DEFINITIONS. As used in this Declaration, the following words, phrases and terms shall have the meaning as provided in the initial paragraph of this Declaration, in the Recitals or in this Section 1, unless the specific context of usage of a particular word, phrase or term requires otherwise:

1.1 Affordable Home. Each of the five (5) separate residential dwelling units, or 15% of total units, in the Project constructed or to be constructed for sale to Qualifying Households, whether in the form of a single-family residence, town-home, condominium or another form, and the associated legal parcel of the Property on or in which each dwelling unit is located, respectively.

1.2 Affordable Housing Cost. An “affordable housing cost” as defined in Health and Safety Code Section 50052.5 and accompanying regulations of the California Department of Housing and Community Development. The Affordable Housing Cost may be modified from time to time based upon updates to the State Income Limits for Low Income households as established the State’s Housing and Community Development Department

1.3 Affordability Period. The time period beginning following full occupancy for each of the Affordable Homes following Close of Escrow and ending on the forty-fifth (45th) anniversary of the Completion Date.

1.4 City. The City of Upland, California, a municipal corporation.

1.5 Completion Date. The first date on which fee title to the Property is conveyed to a Qualifying Household at an Affordable Housing Cost.

1.6 County. The County of San Bernardino, California.

1.7 Default. Any Monetary Default or Non-Monetary Default.

1.8 Default Interest. Interest at an annual rate equal to the lesser of: (a) eight percent (8%) per annum; or (b) the Usury Limit.

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3 1.9 Event of Default. The occurrence of any one or more of the following:

1.9.1 Monetary Default. A Monetary Default that continues for ten (10) business days after Notice to the defaulting Party from City, specifying in reasonable detail the amount of money not paid and the nature and calculation of each such payment;

1.9.2 Non-Monetary Default. Any Non-Monetary Default that is not cured within thirty (30) days after Notice to the defaulting Party from City describing the Non-Monetary Default in reasonable detail, or, in the case of a Non-Monetary Default that cannot with reasonable diligence be cured within thirty (30) days after the effective date of such Notice, if the defaulting Party does not do all of the following: (a) within thirty (30) days after Notice of such Non- Monetary Default, advise City of the intention of the defaulting Party to take all reasonable steps to cure such Non-Monetary Default; (b) duly commence such cure within such period, and then diligently prosecute such cure to completion; and (c) complete such cure within a reasonable time under the circumstances.

1.10 Maintenance Deficiency. The occurrence of an adverse condition on any area of the Property in contravention of the Maintenance Standard.

1.11 Maintenance Standard. Maintenance of the Property in good condition and repair and a neat, clean and orderly condition, including, without limitation, maintenance, repair, reconstruction and replacement of all improvements on the Property and maintenance of Owner’s good standing with the Property’s home owners association, including but not limited to timely payment of all home owners association dues and fees.

1.12 Monetary Default. Any failure by Owner to pay or deposit, when and as this Declaration requires, any amount of money, any bond or surety or evidence of any insurance coverage required to be provided under this Declaration, whether to or with the City or a Third Person.

1.13 Non-Monetary Default. Any or all of the following, excepting any such failure constituting a Monetary Default: (a) failure of a Party to perform any of its obligations under this Declaration; (b) failure of a Party to comply with any affirmative or negative covenant or material restriction or prohibition in this Declaration; or (c) occurrence of any other event or circumstance that, with the passage of time or giving of Notice, or both, or neither, would constitute a breach of this Declaration by a Party.

1.14 Notice. Any consent, demand, designation, election, notice, or request relating to this Declaration, including any Notice of Default. All Notices must be in writing.

1.15 Notice of Default. Any Notice claiming or giving Notice of a Default or alleged Default.

1.16 Owner. As defined in the Preface, a Qualifying Household purchaser of the Property, which is an Affordable Home, in compliance with this Declaration.

1.17 Parties. Collectively, City and Owner.

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4 1.18 Party. Individually, either City or Owner, as applicable.

1.19 Person. Any association, corporation, governmental entity or agency, individual, joint venture, joint-stock company, limited liability company, partnership, trust, unincorporated organization or other entity of any kind.

1.20 Property. That certain real property located within the City of Upland, County of San Bernardino, State of California, specifically described in the legal descriptions attached as Exhibit “A” to this Declaration, which is incorporated into this Declaration by this reference.

1.21 Purchase Money Deed of Trust. A deed of trust recorded against the Owner’s title to its Affordable Home securing repayment of such Owner’s then current Purchase Money Loan.

1.22 Purchase Money Loan. A loan from a Federal or State chartered bank, savings and loan or credit union to the then current Owner of an Affordable Home, the proceeds of which were entirely used by such Owner to acquire title to the subject Affordable Home.

1.23 Purchase Price. The amount paid by the then current Owner of the subject Affordable Home to acquire title to the Affordable Home from the Developer or the previous Owner of the Affordable Home, plus any associated Sale Costs paid by the then current Owner.

1.24 Qualifying Household. An individual or family with an income above Very Low Income and not exceeding Low Income as published annually for the County by the Californ ia Department of Housing and Community Development consistent with the maximum allowable income of persons and families pursuant to Health and Safety Code Section 50093 and associated regulations of the California Department of Housing and Community Development.

1.25 Record, recorded, recording or recordation. Recordation of the referenced document in the official records of the County.

1.26 Resale or Resell. Transfer of an Affordable Home by its Owner.

1.27 Resale Purchaser. Transferee of an Affordable Home from the Affordable Home’s immediately prior Owner.

1.28 Resale Transfer Notice. Defined in Section 3.8.1.

1.29 Sale Costs. All of the following related to a Transfer of an Affordable Home: (a) the seller’s portion of any closing costs; (b) the actual cost of necessary health and safety related repairs to the Affordable Home; and (c) costs of obtaining homeowners association documents (if any).

1.30 Third Person. Any Person that is not a Party, an affiliate of a Party, a relative of a Party or an elected official, officer, director, manager, shareholder, member, principal, partner, employee or agent of a Party.

1.31 Transfer. Regarding any property, right or obligation means any of the following, whether by operation of law or otherwise, whether voluntary or involuntary, and whether direct or

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5 indirect, any assignment, conveyance, grant, hypothecation, mortgage, pledge, sale, or other transfer, whether direct or indirect, of all or any part of such property, right or obligation, or of any legal, beneficial, or equitable interest or estate in such property, right or obligation or any part of it (including the grant of any easement, lien, or other encumbrance) or any change in the occupancy of the Property from being occupied by Owner as Owner’s principal residence to being rented by Owner to any other person, exclusive of any of the following (provided that the City has received written notice of such occurrence) relating to the Property: (a) a mere change in form of ownership with no material change in beneficial ownership and such change in ownership is a tax-free transaction under United States income tax law and the State of California real estate transfer tax law; (b) a conveyance only to member(s) of the immediate family(ies) of the transferor(s) or trusts for their benefit; or (c) a collateral conveyance pursuant to a Purchase Money Deed of Trust.

1.32 Unavoidable Delay. A delay in a Party performing any obligation under this Declaration, arising from or on account of any cause whatsoever beyond the Party’s reasonable control, including strikes, labor troubles or other union activities, casualty, war, acts of terrorism, riots, litigation, governmental action or inaction, regional natural disasters or inability to obtain required materials. Unavoidable Delay shall not include delay caused by a Party’s financial condition, illiquidity, or insolvency.

1.33 Usury Limit. The highest rate of interest, if any, that Law allows under the circumstances.

2. EXHIBITS. The following exhibits are attached hereto and made a part of this Declaration by this reference:

Exhibit A Property Legal Description

3. OWNER COVENANTS

3.1 Owner Covenants of Qualification to Own Affordable Home. Owner hereby covenants, represents and warrants to City that as of the date on which such Owner is approved by Developer for acquisition of an Affordable Home, the total household income for such Owner did not exceed the maximum household income permitted for a Qualifying Household. Owner hereby further covenants, represents and warrants to City that, as of the date on which such Owner acquires title to its Affordable Home: (a) Owner shall promptly occupy the Affordable Home after the date on which such Owner acquires title to its Affordable Home as Owner’s principal place of residence; (b) Owner has not entered into any arrangement to, and shall not sell, lease, rent, transfer or assign the Affordable Home to any Third Person during the Affordability Period, except as expressly allowed by this Declaration for resale to a Qualifying Household at an Affordable Housing Cost (except as provided in Section 3.10); (c) Owner has no present intention to and will not lease or rent any room or sublet or rent a portion of the Affordable Home to any relative of the Owner or to any Third Person (except as provided in Section 3.10); and (d) the aggregate sum payable each month by Owner following Owner’s acquisition of title to its Affordable Home towards principal and interest on such Owner’s Purchase Money Loan, any loan insurance fees associated with such loans, property taxes and assessments, fire and casualty insurance covering replacement value of property improvements, property maintenance and repairs, a reasonable allowance for utilities, including garbage collection, sewer, water, electricity, gas, and ot her

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6 heating, cooking and refrigeration fuels, but exclusive of telephone service, and home owner association fees, all in relation to the Affordable Home, does not exceed an Affordable Housing Cost for the Owner’s household.

3.2 Owner Voluntary Submission to Declaration and Reservation of Property for Affordable Housing.

3.2.1 Owner acknowledges that, without the limitations imposed by this Declaration, Owner would not have been able to acquire its Affordable Home. Therefore, Owner agrees that all of the covenants, conditions and restrictions created by this Declaration are: (a) required to increase and preserve housing available to Qualifying Households in the City; (b) reasonable in light of their purposes; and (c) approved in every respect by Owner. Owner acknowledges that in acquiring its Affordable Home, the sole and exclusive benefit sought by Owner was decent and affordable shelter and Owner has received such benefit. Owner further acknowledges that ownership of its Affordable Home is not intended to give Owner a business opportunity or right, expectation or entitlement to any profits from any sale of its Affordable Home. Therefore, Owner agrees not to challenge the covenants, conditions or restrictions of this Declaration or any right of Developer or City created under this Declaration and acknowledges and agrees that the covenants, conditions or restrictions of this Declaration are not an unreasonable restraint on any right of Owner to Transfer all or any part of Owner’s Affordable Home.

3.2.2 Owner, on behalf of itself and its successors or assigns, covenants and agrees that throughout the Affordability Period: (a) the Property shall be reserved and restricted for ownership and residential use and occupancy as the primary residence of a Qualifying Household at an Affordable Housing Cost; (b) Owner shall occupy the Property as its primary residence and shall not lease, sublease or rent all or any portion of the Property to any Person, except as expressly provided in Section 3.10; (c) Owner shall not Transfer all or any portion of the Property to any Person who is not a Qualifying Household; (d) Owner shall not Transfer all or any portion of the Property to a Qualifying Household for more than an Affordable Housing Cost for such Qualifying Household; and (e) Owner shall not Transfer all or any portion of the Property to a Qualifying Household for a use other than such Qualifying Household’s primary residence.

3.3 Residency Verification. Owner for itself, its heirs, successors and assigns, covenants and agrees that City shall have the right and reasonable opportunity, at least once every twelve (12) months, to verify Owner’s continued occupancy of such Owner’s Affordable Home as its principal place of residence and Owner agrees to cooperate in providing evidence of such residency.

3.4 Occupant Income Information. Each Owner covenants and agrees to provide the Income Certification Form in substantially the same form as attached hereto as Exhibit B, which may include any or all of the following information or documentation to City, upon request by City: (1) copies of filed Federal and State income tax returns and copy of each W2 Wage and Earnings Statement for the three (3) most recently concluded income tax years for each adult Person in the Owner’s household; (2) an income verification form from the current employer(s) of all employed adult Person’s in the Owner’s Household; (3) an income verification form from the United States Social Security Administration or the California Department of Social Services for each Person in the Owner’s household who receives assistance from either of such agencies (if

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7 any); or (4) for each adult Person in the Owner’s household who is unemployed or has no such income tax return, another form of independent income verification.

3.5 Household Income Changes. Each Affordable Home will continue to be treated as occupied by a Qualifying Household, even if during Owner’s residency, Owner’s household ceases to be a Qualifying Household, as long as Owner’s household was a Qualifying Household on the date Owner acquired title to its Affordable Home. No resident of an Affordable Home shall be denied continued occupancy of the Affordable Home solely because the income of the individual or household increases (or family size decreases) in a manner that causes the individual or household to cease being a Qualifying Household, as long as the income of the individual or household did not exceed the maximum income allowable for a Qualifying Household on the date such individual or household acquired title to its Affordable Home.

3.6 Inspections. Each Owner covenants and agrees to permit City to inspect Owner’s Affordable Home, from time-to-time, for purposes of verifying compliance with this Declaration, upon seven (7) days prior written notice to Owner.

3.7 Owner Covenant Regarding No Discrimination or Segregation. Owner covenants by and for itself and all Persons claiming under or through such Owner that there shall be no discrimination against or segregation of any Person or group of Persons, on account of race, color, creed, religion, sex, marital status, national origin, or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the Owner 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, sub-tenants, sub-lessee, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land. Notwithstanding the first sentence of this Section 3.7, with respect to familial status, this Section 3.7 shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in this Section 3.7 shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 and Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of Section 12955 of the Government Code shall apply to this Section 3.7.

3.8 Resale of Affordable Home by Owner.

3.8.1 City Notice. Owner, for itself, its successors and assigns, hereby covenants and agrees that Owner shall not Transfer its Affordable Home (or any interest in its Affordable Home), other than a collateral transfer under a Purchase Money Deed of Trust for the benefit of the beneficiary of such Purchase Money Deed of Trust, without first giving Notice to City (each, a “Resale Transfer Notice”) and obtaining the written concurrence of City that the proposed Transfer complies with this Declaration. Within fifteen (15) da ys following the receipt of a Resale Transfer Notice, City shall deliver to Owner a written concurrence or objection to the Transfer of the Affordable Home. Each Resale Transfer Notice shall include all of the following information:

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8 (a) the identity of the proposed Resale Purchaser, including the identity of all persons in the household of the proposed Resale Purchaser proposing to reside in the Affordable Home;
(b) all of the documentation described in Section 3.4 regarding the household of the proposed Resale Purchaser;
(c) the proposed resale price of the Affordable Home payable by the proposed Resale Purchaser, including the terms of the Purchase Money Loan to be assumed or obtained by the proposed Resale Purchaser, the estimated amount of Sale Costs, real estate broker fees and other resale costs or charges payable by the Owner or the proposed Resale Purchaser regarding the Resale of the subject Affordable Home;
(d) the name, address, and telephone number of the escrow agent proposed to conduct the escrow for the Transfer of the Affordable Home from the Owner to the proposed Resale Purchaser;
(e) an executed written acknowledgment and agreement from the proposed Resale Purchaser for the benefit of City, in recordable form, that the ownership and occupancy of the subject Affordable Home is subject to this Declaration and that the proposed Resale Purchaser shall assume the rights and obligations of Owner under this Declaration; and (f) such other information as City may reasonably request.

3.8.2 Resale Purchaser Qualifications. Owner acknowledges and agrees that, in accordance with Section 3.2, all Resale Purchasers of Owner's Affordable Home must be a Qualifying Household, the proposed resale price of Owner's Affordable Home must be an Affordable Housing Cost for such Resale Purchaser and the Resale Purchaser must occupy the Affordable Home as its principal residence. Owner agrees that City shall have the right and reasonable opportunity, prior to each Resale of Owner's Affordable Home, to verify that each proposed Resale of Owner's Affordable Home will be to a Qualifying Household at an Affordable Housing Cost for such Qualifying Household and that the Resale Purchaser intends to occupy the Affordable Home as its principal residence after acquiring title to the Affordable Home.

3.8.3 Shared Net Equity Appreciation. Owner acknowledges and agrees that the resale purchase price is calculated based on affordability requirements and restricted to the affordable housing cost, as that cost is defined in Section 50052.5 of the Health and Safety Code and accompanying regulations of the California Department of Housing and Community Development. Consistent with State law, City shall ensure equity sharing in effect at the time the resale Purchase Money Loan closes, consistent with CalHOME Guidelines in effect at that time.

3.9 Transfers Not Requiring City Consent. Notwithstanding the foregoing, City consent or approval shall not be required for any of the following Transfers (each, an “Exempt Transfer”:

3.9.1 Conveyance as a Result of Marriage. A transfer of title to an Affordable Home by the Owner to himself/herself and his/her spouse (such that the spouses become co-Owners of the Affordable Home) as a result of a marriage;

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9 3.9.2 Conveyance to a Revocable Living Trust. A transfer of title to an Affordable Home by the Owner to a revocable living trust established by such Owner for estate planning purposes, where such Owner is a beneficiary of such trust;

3.9.3 Conveyances between Co-Owners as a Result of Death, Voluntary Conveyance, or Divorce. If there is more than one individual constituting the Owner of the Affordable Home (i.e., spouses, joint tenants, etc.), a transfer of one Owner’s interest in the Affordable Home to the other Owner by reason of death, voluntary conveyance, divorce or dissolution of marriage or incidental property settlement by which the spouse of an Owner becomes a sole Owner of the Property;

3.9.4 Conveyance to a Person who is Not a Co-Owner as a Result of Death.

Upon the death of an Owner, a Transfer of the Affordable Home to a Qualifying Ho usehold that meets the other requirements of this Declaration for ownership and occupancy of the Affordable Home. If the transferee of the Affordable Home upon the death of an Owner is not a Qualifying Household who meets the requirements of this Declaration for ownership and occupancy of the Affordable Home, the Transfer is not an Exempt Transfer and the transferee shall, within one hundred eighty (180) days after the date the transferee obtains title to the Affordable Home, transfer fee title to the Affordable Home to a Qualifying Household at an Affordable Housing Cost pursuant to this Declaration;

3.9.5 Purchase Money Deed of Trust. The execution of a Purchase Money Deed of Trust, including pursuant to a refinancing transaction in accordance with Section 3.13, provided that the lien is being created in good faith and for value;

3.9.6 Foreclosure of Purchase Money Deed of Trust. Any foreclosure or deed in lieu of foreclosure with respect to a Purchase Money Deed of Trust.

3.10 Temporary Rentals. If City determines, in City’s sole and absolute discretion, that extenuating circumstances justify the temporary rental of an Affordable Home by its Owner, as when such Owner must temporarily relocate to another area of the country, but will return to occupy the Affordable Home as such Owner’s primary residence within less than twelve (12) months. However, even if City allows temporary rental of an Affordable Home, the tenant must be a Qualifying Household and the rent must not exceed an Affordable Housing Cost for such tenant. City may impose conditions upon the Owner and the tenant as a condition to consenting to temporary rental of an Affordable Home, in the sole and absolute discretion of City.

3.11 Owner Affordable Home Maintenance. Owner, for itself, its successors and assigns, covenants and agrees that:

3.11.1 Owner Obligation. Owner’s Affordable Home shall be continuously maintained by Owner, at Owner’s sole cost and expense, in accordance with the Maintenance Standard.

3.11.2 City Remedies. During the continuance of a Maintenance Deficiency regarding Owner's Affordable Home, City may send Notice to Owner of such Maintenance Deficiency. If Owner fails to cure or commence and diligently pursue to cure the Maintenance Deficiency within thirty (30) calendar days following its receipt of No tice of the Maintenance

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10 Deficiency, City may conduct a public hearing, following transmittal of Notice of the public hearing to Owner, at least ten (10) days prior to the scheduled date of such public hearing, to verify whether a Maintenance Deficiency exists regarding Owner’s Affordable Home. If, upon the conclusion of the public hearing, City finds that a Maintenance Deficiency exists regarding Owner’s Affordable Home and remains uncured, City shall have the right to enter the exterior areas of Owner's Affordable Home and perform all acts necessary to cure the Maintenance Deficiency or to take any other action at law or in equity that may then be available to City to accomplish the abatement of the Maintenance Deficiency. Any sum expended by City for the abatement of a Maintenance Deficiency pursuant to this Section 3.11.2 shall be reimbursed to City by Owner within thirty (30) calendar days after Notice to Owner requesting payment. If any amount becoming due to City under this Section 3.11.2 is not paid within thirty (30) calendar days after Notice to Owner requesting payment, Owner shall also pay Default Interest on such amount, until such amount is paid in full.

3.12 Only Purchase Money Encumbrances. Owner shall only be allowed to encumber its Affordable Home with Purchase Money Deeds of Trust. Encumbering the title to an Affordable Home with other than Purchase Money Deeds of Trust is prohibited and shall constitute a Monetary Default under this Declaration. The outstanding balance of the Owner’s then current Purchase Money Loan shall never exceed the Purchase Price paid by such Owner to acquire the subject Affordable Home. Owner acknowledges and agrees by accepting a Transfer of an Affordable Home subject to this Declaration that City has a substantial interest in promoting stability of ownership of the Owner's Affordable Home and that the restriction on encumbrance in this Section 3.12 is reasonable and reasonably calculated to avoid potential foreclosure and sale of the Owner's Affordable Home.

3.13 Refinancing. Owner shall be entitled to enter into a refinancing transaction that meets all of the following requirements: (a) the transaction represents a refinancing of all of the Owner's then current Purchase Money Loan; (b) the refinancing loan bears for its entire term a fixed annual percentage rate that is lower than the annual percentage rate of the loan being refinanced; (c) the entirety of the gross proceeds of the refinancing loan, less reasonable and customary costs of processing the refinancing loan, obtaining appraisals, and the like not exceeding three percent (3%) of the refinancing loan amount, are used to refinance the entire balance of the Owner’s then current Purchase Money Loan (no “cash out” to Owner and the Affordable Home is completely released from the lien of the then current Purchase Money Deed of Trust securing the loan being refinanced); (d) the refinancing loan does not provide Owner with the ability to obtain cash advances or other “cash out” options; and (e) Owner's monthly principal and interest expenses or loan term are reduced relative to the same elements of the loan being refinanced. A refinancing loan obtained by Owner that satisfies all of the requirements of this Section 3.13 shall, upon closing of such loan, be considered Owner’s then current Purchase Money Loan and the deed of trust securing such refinancing loan shall be considered the then current Purchase Money Deed of Trust.

4. COVENANTS RUN WITH THE LAND. The Parties hereby declare their mutual specific intent that the covenants, conditions, restrictions, reservations and agreements set forth in this Declaration are part of a plan for the promotion and preservation of affordable housing within the territorial jurisdiction of the City and that each shall be deemed covenants running with the land of the Property, binding upon each successor-in-interest of Owner, for the duration of the Affordability Period. Regardless of classification or characterization, each of the covenants,

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11 conditions, restrictions and agreements contained in this Declaration touch and concern the land of the Property and each of them is expressly declared to be for the benefit and in favor of the City for the duration of the Affordability Period, regardless of whether or not the City is or remains an owner of any land or interest in land to which such covenants, conditions, restrictions or agreements relate. The City, in the event of any Default or breach of this Declaration, has the right to exercise all of the rights and remedies, and to maintain any actions at law or suits in equity or other proper proceedings, to enforce the curing of such Default or breach, as provided in this Declaration, at law or in equity. Each and every contract, deed or other instrument hereafter executed covering or conveying all or any portion of or any interest in the Property shall incorporate all of the provisions of this Declaration, either expressly or by reference, and any contract, deed or other instrument transferring any estate or interest in an Affordable Home, shall conclusively be deemed to have been executed, delivered and accepted subject to the agreements, covenants, conditions, reservations, and restrictions of this Declaration, regardless of whether such agreements, covenants, conditions, reservations and restrictions are set forth in or referenced such contract, deed or other instrument.

5. AGENCY REMEDIES. If an Event of Default occurs, the City shall have the right to exercise any or all of the remedies described in this Section 5, all cumulative (so exercis e of one remedy shall not preclude exercise of another remedy), in addition to such other remedies as may be available at law or in equity, under any other provisions of this Declaration or pursuant to the City Grant Deed or the DDA.

5.1 Suits Before End of Affordability Period. The City may sue the defaulting Party for damages or other relief, from time to time, at the City’s election, without terminating this Declaration, including by mandamus or other suit, action or proceeding at law or in equity, to require the defaulting Party to perform the covenants or agreements or observe the conditions or restrictions of this Declaration, or enjoin any acts or things that may be unlawful or in violation of the rights of the City under this Declaration; or by other action at law or in equity, as necessary or convenient to enforce the covenants, agreements, conditions or restrictions of this Declaration.

5.2 Receipt of Moneys. No receipt of money by the City from any Person after any Notice of Default to a Party shall affect any Notice previously given to such Party, or waive the City’s right to enforce payment or deposit of any amount payable or later falling due, or the City’s right to enter the Property, it being agreed that after service of Notice of Default or the commencement of suit or proceedings, or after final order or judgment, the City may demand, receive, and collect any moneys due or thereafter falling due, without in any manner affecting such Notice, proceeding, order, suit or judgment, all such moneys collected being deemed payments on account of the applicable Party’s liability to the City.

5.3 No Waiver. No failure by the City to insist upon strict performance of any condition, covenant, agreement, restriction or reservation of this Declaration or to exercise any right or remedy upon a Default and no acceptance of full or partial payment of any amount due or becoming due to the City during the continuance of any such Default shall waive any such Default or such condition, covenant, agreement, restriction or reservation. No obligation of a Party under this Declaration shall be modified and no Default, shall be waived, except by a written instrument signed by the City. No waiver of any Default shall modify this Declaration. Each and every covenant, agreement, condition, restriction and reservation of this Declaration shall continue in

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12 full force and effect with respect to any other then-existing or subsequent Default of such condition, covenant, agreement, restriction or reservation of this Declaration.

5.4 Damages. The City may recover from each other Party all damages the City incurs by reason of such Party’s Default and reimbursement of the City’s reasonable out of pocket costs, including reasonable attorney fees. The City may recover such damages at any time after another Party’s Default, including after the expiration of the Affordability Period. Notwithstanding any applicable law to the contrary, the City need not commence separate actions to enforce another Party’s obligations for each amount or payment not paid, or each month’s accrual of damages and costs for the other Party’s Default, but may bring and prosecute a single c ombined action for all such damages and costs.

5.5 Injunction of Breaches. Whether or not an Event of Default has occurred, the City may obtain a court order enjoining each other Party from continuing any Default or from committing any threatened Default.

5.6 Specific Enforcement. Owner agrees that specific enforcement of its non-monetary obligations under this Declaration is one of the reasons that the City entered into this Declaration and that, if Owner Defaults or breaches in performance or failure to perform any such obligation, potential monetary damages to the City, as well as to prospective Qualifying Households, would be difficult, if not impossible, to evaluate and quantify. Therefore, in addition to any other relief to which the City may be entitled as a consequence of a Default Owner under this Declaration, Owner agrees to the imposition of the remedy of specific performance against Owner under this Declaration.

5.7 Enforcement. The City, as successor in interest to the City, shall have the power to enforce this Declaration and no other Person shall have any right or power to enforce any provision of this Declaration on behalf of the City or the City or to compel the City or the City to enforce any provision of this Declaration against Owner or the Affordable Homes, except to the extent required or authorized by Health and Safety Code Section 33334.3(f)(7).

6. GENERAL PROVISIONS

6.1 Relationship of Parties. Nothing contained in this Declaration shall be interpreted or understood by any of the Parties, or by any Third Person, as creating the relationship of employer and employee, principal and agent, limited or general partnership, or joint venture between or among City, Developer or any Owner.

6.2 Governing Law. This Declaration shall be governed by the substantive and procedural laws of the State of California, without application of conflicts or choice of laws principles.

6.3 Amendment. This Declaration may be amended only by a written instrument signed by City and each other Party then owning an estate in property then subject to this Declaration.

6.4 Principles of Interpretation. No inference in favor of or against any Party shall be drawn from the fact that such Party has drafted any part of this Declaration. The Parties have

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13 participated substantially in the negotiation, drafting, and revision of this Declaration, with advice from counsel and other advisers of their own selection. A term defined in the singular in this Declaration may be used in the plural, and vice versa, all in accordance with ordinary principles of English grammar, which govern all language in this Declaration. The words “include” and “including” in this Declaration shall be construed to be followed by the words: “without limitation.” Each collective noun in this Declaration shall be interpreted as if followed by the words “(or any part of it),” except where the context clearly requires otherwise. Every reference to any document, including this Declaration, refers to such document as modified from time to time (except, at the City’s option, any modification that violates this Declaration), and includes all exhibits, schedules, and riders to such document. The word “or” in this Declaration includes the word “and.” Every reference to a law, statute, regulation, order, form or similar governmental requirement refers to each such requirement as amended, modified, renumbered, superseded or succeeded, from time to time.

6.5 Attorney’s Fees. In the event that a Party brings an action to enforce this Declaration or otherwise arising out of this Declaration, the prevailing Party in such action shall be entitled to recover from the other Party reasonable attorney fees to be fixed by the court in which a judgment is entered, as well as the costs of such suit. For the purposes of this Declaration, the words “reasonable attorney fees” in the case of the City, include the salaries, costs and overhead of the lawyers employed in the Office of the City Attorney of the City who are legal counsel to the City in such an action, as allocated on an hourly basis.

6.6 Severability. If any term or provision of this Declaration or its application to any Person, property or circumstance shall to any extent be invalid or unenforceable, then the remainder of this Declaration, or the application of such term or provision to Persons, properties or circumstances, other than those as to which it is invalid or unenforceable, shall not be affected by such invalidity. All remaining provisions of this Declaration shall be valid and be enforced to the fullest extent applicable law allows.

6.7 Time is of the Essence. Time is of the essence with respect to the performance of each term, provision, covenant, condition, restriction, reservation or agreement contained in this Declaration.

6.8 Unavoidable Delay; Extension of Time of Performance. Performance by a Party under this Declaration shall not be deemed or considered to be in Default, where any such Default is due to the occurrence of an Unavoidable Delay.

6.9 Titles and Headings for Reference Only. The titles and headings of the articles, paragraphs or sections of this Declaration are for convenience and reference only and are not to be considered a part of this Declaration and shall not in any way interpret, modify or restrict the meaning of any term, provision, covenant, condition, restriction, reservation or agreement contained in this Declaration.

6.10 Notices.

6.10.1 Delivery. Any and all Notices sent by a Party to another Party pursuant to or as required by this Declaration shall be proper, if in writing and transmitted to the address of

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14 the recipient Party designated in Section 6.10.2, by one or more of the following methods: (a) messenger for immediate personal delivery; (b) a nationally recogniz ed overnight (one Business Day) delivery service (i.e., Federal Express, United Parcel Service, etc.); or (c) registered or certified United States mail, postage prepaid, return receipt requested. Such Notices may be sent in the same manner to such other address as a Party may from time to time designate by Notice, in accordance with this Section 6.10. Any such Notice shall be deemed to be received by the addressee, regardless of whether or when any return receipt is received by the sender or the date set forth on such return receipt, on the day that it is delivered by personal delivery, on the date of delivery by a nationally recognized overnight courier service or three (3) calendar days after it is placed in the United States mail, as provided in this Section 6.10. Rejection, other refusal to accept or the inability to deliver a Notice because of a changed address of which no notice was given, shall be deemed receipt of the Notice. Any attorney representing a Party may give any Notice on behalf of such Party.

6.10.2 Addresses. The following are the authorized addresses for the submission of Notices to the Parties, as of the Effective Date:

To City:

City of Upland
460 N Euclid Ave
Upland, California 91786

Attention: City Manager

To Owner: ____________________[Owner]
____________________[Owner Address]
____________________[Owner Address]

6.10.3 Entire Agreement. This Declaration may be signed in counterpart originals, each of which shall be deemed to be an original, and all of which together shall constitute one and the same instrument. This Declaration includes fourteen (14) pages and one (1) exhibit.

This Declaration constitutes the entire understanding and integrate all of the terms, conditions, covenants, restrictions, reservations, terms, provisions and agreements of the Parties regarding the Property and supersedes all negotiations or previous agreements between the Parties with respect to the Property. None of the terms, conditions, covenants, restrictions, reservations, terms, provisions or agreements set forth in this Declaration shall be deemed to be merged with any deed conveying title to any estate or interest in the Property. [Signatures on following page]

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15 SIGNATURE PAGE
TO

RESALE RESTRICTION AGREEMENT AND

DECLARATION OF AFFORDABLE HOUSING

COVENANTS, CONDITIONS AND RESTRICTIONS
(___________________________ [ADDRESS])
IN WITNESS WHEREOF, City and Developer have caused this Declaration to be signed or on their behalf by their duly authorized representatives, as set forth below:

CITY:

THE CITY OF UPLAND, a California
public body, corporate and politic

By:

OWNER:

_____________________________
[OWNER’S NAME]

By:__________________________

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FOR DISCUSSION PURPOSES ONLY
EXHIBIT “A”
TO

RESALE RESTRICTION AGREEMENT AND

DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
(___________________________[ADDRESS])
Property Legal Description
[To follow]

APNs:

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FOR DISCUSSION PURPOSES ONLY
EXHIBIT “B”
TO

RESALE RESTRICTION AGREEMENT AND

DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
(___________________________[ADDRESS])
Income Certification Form

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FOR DISCUSSION PURPOSES ONLY

INCOME CERTIFICATION FORM
An income certification is required as one of the stipulations of purchasing an affordable home contracted under the Housing Authority. In order to ensure compliance, please fill out the following and return it with proof of income and assets to the responsible agent.

NAME OF APPLICANT(S): PRESENT HOME ADDRESS:

Home Phone: _ Work Phone: _
Cell Phone: E-mail Address:

Names of Members of Household
Relationship to
Head of
Household

Date of
Birth

Employer or Other
Source of Income

Annual Gross
Income*
Head $
$
$
$
$
$
Anticipated gross income of all adults during the next 12-month period: $

*Annual Gross Income includes:
1) all wages and salaries, overtime, commissions and bonuses BEFORE payroll deductions; 2) full amount of periodic payment(s) received from Social Security, annuities, insurance policies, retirement funds, pensions, disability of death benefits, alimony, child support and regular contributions/gifts;

3) payments in lieu of earnings.

Total value of all assets (excluding personal property) ......................................................... $ Income expected from assets during next 12-month period: (Interest, dividends, etc.)………………. $ TOTAL OF ALL INCOME DURING NEXT 12-MONTH PERIOD:………………………………………….

Total income includes expected income from assets, but not value of assets $

The undersigned certifies that all of the above information is a full disclosure of all income and is true and correct.

Date (Applicant’s Signature)
Date (Applicant’s Signature)

TO BE CERTIFIED YOU MUST ATTACH PROOF OF INCOME

46708.00203\34818147.18
DRAFT 11/09/22

FOR DISCUSSION PURPOSES ONLY
EXHIBIT “C”
TO

REGULATORY AGREEMENT AND DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
Income Certification Form

46708.00203\34818147.18
DRAFT 11/09/22

FOR DISCUSSION PURPOSES ONLY

INCOME CERTIFICATION FORM
An income certification is required as one of the stipulations of purchasing an affordable home contracted under the Housing Authority. In order to ensure compliance, please fill out the following and return it with proof of income and assets to the responsible agent.

NAME OF APPLICANT(S): PRESENT HOME ADDRESS:

Home Phone: _ Work Phone: _
Cell Phone: E-mail Address:

Names of Members of Household
Relationship to
Head of
Household

Date of
Birth

Employer or Other
Source of Income

Annual Gross
Income*
Head $
$
$
$
$
$
Anticipated gross income of all adults during the next 12-month period: $

*Annual Gross Income includes:
1) all wages and salaries, overtime, commissions and bonuses BEFORE payroll deductions; 2) full amount of periodic payment(s) received from Social Security, annuities, insurance policies, retirement funds, pensions, disability of death benefits, alimony, child support and regular contributions/gifts;

3) payments in lieu of earnings.

Total value of all assets (excluding personal property) ......................................................... $ Income expected from assets during next 12-month period: (Interest, dividends, etc.)………………. $ TOTAL OF ALL INCOME DURING NEXT 12-MONTH PERIOD:………………………………………….

Total income includes expected income from assets, but not value of assets $

The undersigned certifies that all of the above information is a full disclosure of all income and is true and correct.

Date (Applicant’s Signature)
Date (Applicant’s Signature)

TO BE CERTIFIED YOU MUST ATTACH PROOF OF INCOME

46708.00203\34818147.18
DRAFT 11/09/22

FOR DISCUSSION PURPOSES ONLY

EXHIBIT “D”
TO

REGULATORY AGREEMENT AND DECLARATION OF

AFFORDABLE HOUSING COVENANTS, CONDITIONS

AND RESTRICTIONS
(Northwest Corner of 1st Ave and A St.)
Affordable Housing Cost

46708.00203\34818147.18
DRAFT 11/09/22

FOR DISCUSSION PURPOSES ONLY
City of Upland
First Time Homebuyer Program

New Construction Single-Family Maximum Purchase Price Analysis (70% AMI)

Unit Size (Bedrooms)
Adjusted Household (HH) Occupancy
2 BR and
3-HH
3 BR and
4-HH
4 BR and
5-HH
Income Maximum
70% of Area Median Income (AMI) per HH* $55,055 $61,180 $66,080 Maximum Monthly Affordable Housing Cost
Affordability based on 30% of 70% AMI* $1,377 $1,530 $1,652 1 Sales Price Maximum* $400,000 $400,000 $400,000
2 City Silent 2nd Loan Estimate* $285,965 $260,426 $239,994 3 Down-Payment of Sales Price Maximum
(Assumes 1%) (i.e. Homebuyer Contribution) $4,000 $4,000 $4,000 4 First Lender Loan of Sales Price Maximum $110,035 $135,574 $156,006 5 Principal & Interest (Includes PMI (if necessary);
Assumes 6% fixed, 30-year term)
(Estimated Monthly Payment)
$660 $813 $935
6 Property Taxes (1.25% of Sales Price Maximum)
(Estimated Monthly Payment) $417 $417 $417
7 Homeowners Association Dues & Hazard Insurance
(Estimated Monthly Payment) $200 $200 $200
8 Utilities
(Estimated Monthly Payment) $100 $100 $100
Estimated Monthly Housing Payment
(Rows 5+6+7+8) $1,377 $1,530 $1,652

City loan may not be used for closing costs, Recommended Front/Beck End ratios max (30%/42%)

* Sales Price for up to 2022 70% AMI Income per Household. In the event that the actual costs differ from assumptions listed in Rows 5-8 at the time of sale to a First Purchaser, the Sales Price Maximum and Affordable Housing Cost will remain the same and the City Silent 2nd Loan, as noted in Row 2, shall be increased or decreased to account for the difference. In the event that First Purchaser’s actual income is above 70% of AMI adjusted for household size, Sales Price Maximum will remain the same, Affordable Housing Cost will be adjusted consistent with Health & Safety Code § 50052.5 and the City Silent 2nd Loan shall be adjusted accordingly, in addition to any adjustments required by the preceding sentence (see following table for calculation at 2022 80% AMI).

Notwithstanding the above, Affordable Housing Cost shall adjust proportionately to account for annual adjustment to AMI as published by HCD; the Sales Price Maximum shall remain $400,000 and the City Silent 2nd Loan and cost assumptions in Rows 4-8 shall be adjusted as necessary and accordingly to reflect the updated Affordable Housing Cost.

46708.00203\34818147.18
DRAFT 11/09/22

FOR DISCUSSION PURPOSES ONLY
New Construction Single-Family Maximum Purchase Price Analysis (80% AMI)

Unit Size (Bedrooms)
Adjusted Household (HH) Occupancy
2 BR and
3-HH
3 BR and
4-HH
4 BR and
5-HH
Income Maximum
(80% of Area Median Income (AMI)) per HH* $63,400 $70,400 $76,050 Maximum Monthly Affordable Housing Cost
Affordability based on 30% of 80% AMI* $1,585 $1,760 $1,901 1 Sales Price Maximum* $400,000 $400,000 $400,000
2 City Silent 2nd Loan Estimate* $251,169 $221,981 $198,421 3 Down-Payment of Sales Price Maximum
(Assumes 1%) (i.e. Homebuyer Contribution) $4,000 $4,000 $4,000 4 First Lender Loan of Sales Price Maximum $144,831 $174,019 $197,579 5 Principal & Interest (Includes PMI (if necessary);
Assumes 6% fixed, 30-year term)
(Estimated Monthly Payment)
$868 $1,043 $1,184
6 Property Taxes (1.25% of Sales Price Maximum)
(Estimated Monthly Payment) $417 $417 $417
7 Homeowners Association Dues & Hazard Insurance
(Estimated Monthly Payment) $200 $200 $200
8 Utilities
(Estimated Monthly Payment) $100 $100 $100
Estimated Monthly Housing Payment
(Rows 5+6+7+8) $1,585 $1,760 $1,901

City loan may not be used for closing costs, Recommended Front/Beck End ratios max (30%/42%)

* Sales Price for 2022 80% AMI Income per Household. In the event that the actual costs differ from assumptions listed in Rows 5-8 at the time of sale to a First Purchaser, the Sales Price Maximum and Affordable Housing Cost will remain the same and the City Silent 2nd Loan, as noted in Row 2, shall be increased or decreased to account for the difference. In the event that First Purchaser’s actual income is between 70% and 80% of AMI adjusted for household size, Sales Price Maximum will remain the same, Affordable Housing Cost will be adjusted consistent with Health & Safety Code § 50052.5 and the City Silent 2nd Loan shall be adjusted accordingly, in addition to any adjustments required by the preceding sentence. Notwithstanding the above, Affordable Housing Cost shall adjust proportionately to account for annual adjustment to AMI as published by HCD; the Sales Price Maximum shall remain $400,000 and the City Silent 2nd Loan and cost assumptions in Rows 4-8 shall be adjusted as necessary and accordingly to reflect the updated Affordable Housing Cost.