cc/cdc 2023 AR 01/10 affordable housing agreement santa fe senior village — Vista City Council, January 10, 2023 (part 1 of 2)

ACTION:
____________________________
Clerk/Secretary
Department: City Manager Item No: C4
Prepared by: Sylvia Solis Daniels, Housing Program Manager Meeting Date: January 10, 2023 Approved by: Amanda Lee, Acting City Manager Agenda Location: Consent Calendar SUBJECT: AFFORDABLE HOUSING AGREEMENT WITH SANTA FE SENIOR VILLAGE, LP RECOMMENDATION:

1.Adopt City Council Resolution No. 2023- , approving an Affordable Housing Agreement by and among the Community Development Commission of the City of Vista, the City of Vista and Santa Fe Senior Village, LP, a California Limited Partnership.

2.Adopt Community Development Commission Resolution No. 2023- , approving an Affordable Housing Agreement by and among the Community Development Commission of the City of Vista, the City of Vista and Santa Fe Senior Village, LP, a California Limited Partnership.

3. Adopt Community Development Commission Resolution No. 2023- , amending the Capital Project Budget for Fiscal Years 2022/23 and 2023/24.

CORRELATION TO CITY COUNCIL GOALS: (1) Homelessness & Housing, and (2) A Cleaner Vista.

PRIOR ACTION: On June 28, 2022, adopted City Council Resolution No. 2022-108, approving the Six- Year Capital Improvement Program and FYs 2022/23 and 2023/24 Capital Project Budget and authorizing appropriations for Fiscal Years 2022/23 and 2023/24 Capital Projects and Community Development Commission Resolution No. 2022-6, approving the Six-Year Capital Improvement Program and FYs 2022/23 and 2023/24 Capital Project Budget and authorizing appropriations for Fiscal Years 2022/23 and 2023/24 Capital Projects (Vote: 4-0, Ritter absent (Ritter experienced technical difficulties)).

STATEMENT ON THE SUBJECT: National Community Renaissance of California (National CORE) and the San Diego Community Housing Corporation (SDCHC) are developing Santa Fe Senior Village Apartments at the properties located at 414 and 428 N. Santa Fe Avenue (assessor parcel numbers 175- 116-13-00 and 175-116-11-00). National CORE and SDCHC are mission-based, non-profit community builders that focus on addressing specific needs of communities through the development of service- enriched affordable housing.

National CORE and SDCHC approached the City in Spring 2022 informing staff of their purchase of 414 and 428 N. Santa Fe Avenue, a vacant lot and former auto-mechanic shop. A Vicinity Map is included as Exhibit 6. The project is a by-right development that does not require discretionary approval, with a Density Bonus with no maximum control pursuant to California Government Code Section 65915(f)(3)(D)(ii). This Government Code grants density bonuses and other incentives for 100 percent affordable projects within a half mile of a major transit stop. National CORE and SDCHC discussed their AGENDA
REPORT

CITY COUNCIL

COMMUNITY DEVELOPMENT COMMISSION

SUCCESSOR AGENCY

BUENA SANITATION DISTRICT

JOINT POWERS FINANCING AUTHORITY
01/10/2023 C4 Page 1 of 153
Approved above recommendation, Adopted the following: 1) City Council Resolution No. 2023-1; 2) Community Development Commission Resolution No. 2023-1; and 3) Community Development Commission Resolution No. 2023-2. Vote: 5-0

MEETING DATE: January 10, 2023 PAGE 2
SUBJECT: AFFORDABLE HOUSING AGREEMENT WITH SANTA FE SENIOR VILLAGE, LP intent to develop the property as a four-story, permanent supportive housing affordable development for seniors and veterans who have experienced homelessness. National CORE and SDCHC conducted several community outreach meetings with residents, community groups, the local business community, the affordable housing community, and members of the City Council. Additionally, National CORE and SDCHC offered tours of similar developments in progress in neighboring communities to introduce local leaders to their developments. National CORE/SDCHC applied for and received funding from San Diego County and State Low Income Tax Credits for the affordable housing development. Santa Fe Senior Village is scheduled to break ground for construction in March 2023, and construction is expected to be completed by September 2024.

Project Cost. The total project cost, including land acquisition, construction, architecture, financing, and other costs, is $26,009,813. The project has received $4,250,000 from the County HOME Loan program, $5,125,000 from the County's No Place Like Home (NPLH) Loan Program, and $10,832,223 from the California Tax Credit Allocation Committee. Exhibit 5 outlines all sources and uses of funds for the project.

Project Request. The developer is requesting $500,000 in funding from the Community Development Commission of the City of Vista (Commission). The funding request is a 58-year residual receipts Commission loan of$500,000. The Commission's total cost per unit is $24,443, which is one-fifth of the typical cost per unit. This funding would support the City in meeting its Regional Housing Needs Assessment (RHNA) and aligns with the City's Strategic Plan to Address Homelessness. An Affordable Housing Agreement is included as Exhibit 4 to include the full terms of the agreement between the City and National CORE/SDCHC. Included in the agreement, the project partnership, Vista Senior Village, LP, has requested that in lieu of providing payment and performance bonds to the City in connection with the loan, the City is accepting a Guarantor's guaranty that construction of the improvements will be completed in accordance with the Affordable Housing Agreement.

Additionally, the Commission is supplementing the development with $795,000 in offsite improvements for pedestrian safety and access to public transportation for the residents of Santa Fe Senior Village as well as other members of the community. The features to be included are:
(i) North and south bound covered bus shelters located in front of the development at North Santa Fe and W. Orange Street and North Santa Fe and E. Orange Street: shelters will be aligned with the design outlined for the Townsite Improvement Project (ii) Sidewalk, curb, and gutter improvements from the alley at the north side of W. Orange Street to Redlands Street
(iii) Lighting improvements to include three streetlights along the alley and undergrounding of all poles for the entire alley
The Commission will fund improvements and the City will oversee contractor completing improvements in tandem with the current Townsite Improvement Project.

Project Overview. Santa Fe Senior Village is a transit-oriented development that will transform a vacant parcel into an affordable housing community. The proposed development will provide 54 units (inclusive of a manager unit) of high-quality housing serving extremely low and very low-income seniors. Santa Fe Senior Village will include 27 units for seniors experiencing homelessness with two units' set-aside for veterans experiencing homelessness. Onsite wraparound supportive services for those experiencing homeless will be fully integrated into the development through private partnerships with government agencies and local nonprofit organizations. The remaining 26 units will serve extremely low- and low- income seniors with rents no greater than $636 and $849, respectively. The below chart outlines the affordability makeup of the project.
01/10/2023 C4 Page 2 of 153

MEETING DATE: January 10, 2023 PAGE 3
SUBJECT: AFFORDABLE HOUSING AGREEMENT WITH SANTA FE SENIOR VILLAGE, LP Number Unit Type Area Median Income Income Restriction Level Rent Ran of Units AMI 9e
34 Studio 30 percent of AMI Extremely Low Income $683 17 Studio 40 percent of AMI Very Low Income $911 1 One Bedroom 30 percent of AMI Extremely Low Income $732 1 One Bedroom 40 percent of AMI Very Low Income $976 1 Two Bedroom Managers Unit No Restriction N/A Staff recommends the Commission approve the Affordable Housing Agreement as drafted, authorizing the City Manager to sign the agreement and associated documents in the current form with any non- substantiative changes leading to the final draft.

FISCAL IMPACT: The Commission's total financial contribution to this development is $1,295,000. $997,779.95 is currently available in the Affordable Housing Project (8234). Approval of the staff recommendation will appropriate an additional $297,220.05 into the Affordable Housing Project (8234) from the Vista Housing Fund Balance Account (No. 1220000.310410).

EXHIBITS:

1. City Council Resolution No. 2023- , approving an Affordable Housing Agreement by and among the Community Development Commission of the City of Vista, the City of Vista and Santa Fe Senior Village, LP, a California Limited Partnership (page 4)

2. Community Development Commission Resolution No. 2023- , approving an Affordable Housing Agreement by and among the Community Development Commission of the City of Vista, the City of Vista and Santa Fe Senior Village, LP, a California Limited Partnership (page 8)

3. Adopt Community Development Commission Resolution No. 2023- , amending the Capital Project Budget for Fiscal Years 2022/23 and 2023/24 (page 12)

4. Affordable Housing Agreement (page 14)

5. Sources and Uses of Funding (page 145)

6. Vicinity Map (page 153)
01/10/2023 C4 Page 3 of 153

RESOLUTION NO. 2023-

A RESOLUTION OF THE CITY COUNCIL OF THE CHARTERED CITY OF

VISTA, CALIFORNIA, APPROVING AN AFFORDABLE HOUSING

AGREEMENT BY AND AMONG THE COMMUNITY DEVELOPMENT

COMMISSION OF THE CITY OF VISTA, THE CITY OF VISTA AND SANTA FE

SENIOR VILLAGE, LP, A CALIFORNIA LIMITED PARTNERSHIP
The City Council of the Chartered City of Vista does resolve as follows:

1. Findings. The City Council hereby finds and declares the following:

A. California Health and Safety Code Sections 33334.2 and 33334.6 formerly authorized and directed the Vista Redevelopment Agency (the "Redevelopment Agency") to expend a certain percentage of all taxes which are allocated to the Redevelopment Agency pursuant to Section 33670 of the California Health and Safety Code for the purposes of increasing, improving and preserving the community's supply of low and moderate income housing available at affordable housing cost to persons and families of low- and moderate-income, lower income, and very low income.

B. Pursuant to applicable law the Redevelopment Agency established a Low and Moderate Income Housing Fund (the "Housing Fund") and acquired certain property with the purpose of using such property for the provision of affordable housing.

C. By ABx1 26 enacted by the California Legislature during 2011 (the "2011 Dissolution Act"), the California Legislative eliminated every redevelopment agency within the State of California, including without limitation the Redevelopment Agency.

D. The 2011 Dissolution Act provides, in part, that the host city of a redevelopment agency was to designate a housing entity to receive the housing assets of the former redevelopment agency within such city.

E. The City Council of the City of Vista ("City") activated a housing authority, the Housing Authority of the City of Vista (the "Authority") within the corporate limits of the City under the auspices of the Community Development Commission of the City of Vista ("Commission"), and designated the Commission on behalf of the Authority as the housing entity to receive the housing assets of the former Redevelopment Agency.

F. Pursuant to the 2011 Dissolution Act, an oversight board ("Oversight Board") has been established to oversee the wind-up of the activities of the Redevelopment Agency. The Oversight Board has approved and affirmed the transfer of the housing assets of the Redevelopment Agency to the Commission on behalf of the Authority.

G. Santa Fe Senior Village, L.P., a California limited partnership (the "Developer") has purchased from a private entity 414 N. Santa Fe Avenue, a vacant lot and former auto-mechanic shop within the corporate limits of the City, which land consists of approximately .58 acres (the "Site"), where the developer will construct a 54-unit housing development, the occupancy of 53 units which would be restricted on the basis of income and affordable rent for senior citizen households, all as more particularly provided in the "Agreement" and the "Notice of Affordability", as described below. The development of the Site as provided under the Agreement constitutes the "Project."
H. In order to implement the affordable housing objectives of the Commission, the Commission proposes to enter into an Affordable Housing Agreement (the "Agreement") with the EXHIBIT 1
01/10/2023 C4 Page 4 of 153

RESOLUTION NO. 2023-

CITY COUNCIL OF THE CHARTERED CITY OF VISTA
PAGE 2
City and the Developer, under which the Developer would agree to construct the Project in accordance with the requirements of the Agreement, restrict occupancy of certain apartment units in the Project to extremely low income households, very low income households, all as more particularly set forth in the Agreement.

I. The Project is located within the project area of the Vista Redevelopment Project (the "Project Area" and the "Redevelopment Project", respectively) of the former Redevelopment Agency and the acquisition, construction and operation of the Project pursuant to the Agreement would benefit the Project Area by providing affordable housing for persons who currently live and work within the Project Area.

J. The Agreement furthers the goals of the Commission as well as the goals of the former Redevelopment Agency as it will facilitate the creation of affordable housing which will serve the residents of the neighborhood and the City and provide for a community facility as described in the Agreement.

K. The California Legislature has declared in Health and Safety Code Section 36000, et seq., that new forms of cooperation with the private sector, such as leased housing, disposition of real property acquired through redevelopment, development approvals, and other forms of housing assistance may involve close participation with the private sector in meeting housing needs, without amounting to development, construction or acquisition of low rent housing projects as contemplated under Article XXXIV of the State Constitution.

L. Health and Safety Code Section 37001.5 provides that a public body does not develop, construct or acquire a low rent housing project under Article XXXIV of the State Constitution when the public body provides assistance to a low rent housing project and monitors construction or rehabilitation of the project to the extent of carrying out routine governmental functions, performing conventional activities of a lender, and imposing constitutionally mandated or statutorily authorized conditions accepted by a grantee of assistance. In addition, the Site is privately owned and will not be subject to an exemption from property tax excepting as provided under subsections (f) or (g) of Section 37001 of the Health and Safety Code.

M. The Agreement provides for assistance by the Commission to the Project, and the Commission's monitoring of construction of the Project to the extent of carrying out routine governmental functions, performing conventional activities of a lender, and imposing constitutionally mandated or statutorily authorized conditions accepted by a grantee of assistance.

N. Voter approval of low rent housing projects within the City of Vista has been previously obtained for purposes of Article XXXIV of the State Constitution. This Resolution is hereby deemed to constitute a final approval of a proposal which may result in housing assistance benefitting persons of low income, within the meaning of Health and Safety Code Section 36005.

O. The City Council and the Commission has duly considered all terms and conditions of the proposed Agreement and believes that the Agreement is in the best interests of the Commission and the City and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable State and local law requirements.

P. Under the Agreement, the Developer shall develop the Site as more particularly set forth in the Agreement. The participation of the Commission with respect to the proposed project is described in a staff report on file with the City Clerk (the Report"). The financial participation by the Commission under the Agreement is in consideration of the particular uses required by the 01/10/2023 C4 Page 5 of 153

RESOLUTION NO. 2023-

CITY COUNCIL OF THE CHARTERED CITY OF VISTA
PAGE 3
Agreement to be conducted by Developer on the Site as well as the Developer's undertakings concerning the development and operation of improvements for affordable rental housing.

Q. The Developer has submitted to the Commission and the City Council of the City of Vista (the "City Council") copies of the Agreement substantially in the form submitted herewith.

R. All actions required by all applicable law with respect to the proposed Agreement have been taken in an appropriate and timely manner.

S. The City Council has previously determined, in its adoption of the ordinance approving the Redevelopment Project, that the Site is a portion of a blighted area, and is underutilized, as further set forth in the Implementation Plan as previously adopted and amended by the former Redevelopment Agency.

T. The Agreement would assist in the alleviation or removal of blighting conditions and would promote the affordable housing objectives of the Commission by providing for the provision of improvements and the operation of certain uses as provided in the Agreement.

U. Each of the Commission and the City Council has duly considered all of the terms and conditions of the proposed Agreement and believes that the redevelopment of the Site pursuant to the Agreement is in the best interests of the City of Vista and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements.

V. The use of funds from the former Redevelopment Agency's Low and Moderate Income Housing Fund pursuant to the Agreement, in the form of proceeds of tax allocation bonds payment of which was secured by moneys from the Low and Moderate Income Housing Fund, as such moneys were used in connection with acquisition of the Site and are proposed to be used as otherwise set forth in the Agreement, will be of benefit to the Project Area for the reasons set forth above.

W. The development of the Site under the Agreement will promote the affordable housing objectives of the Commission and will eliminate blight within the Project Area by providing for the proper reuse and redevelopment of a portion of the Project Area which was declared blighted.

2. Action.

A. The City Council hereby consents to the approval by the Commission of the Agreement in substantially the form presented to the City Council, subject to such revisions as may be made by the City Manager or his or her designee. The City Manager is hereby authorized to execute the Agreement on behalf of the City including any attachments thereto on behalf of the City. A copy of the Agreement when executed by the Commission shall be placed on file in the office of the City Clerk.

B. The City Manager (or his or her designee) is hereby authorized, on behalf of the City, subject to obtaining approval of the City Manager (on behalf of the Commission) to make revisions to the Agreement which do not increase the City's obligations or materially or substantially increase the Commission's obligations thereunder or materially or substantially change the uses or development permitted on the Site, to sign all documents, to make all approvals and take all actions necessary or appropriate to carry out and implement the Agreement and to administer the 01/10/2023 C4 Page 6 of 153

RESOLUTION NO. 2023-

CITY COUNCIL OF THE CHARTERED CITY OF VISTA
PAGE 4
Commission's obligations, responsibilities and duties to be performed under the Agreement and related documents.

3. Adoption. PASSED AND ADOPTED at a meeting of the City Council of the City of Vista held on January 10, 2023, by the following vote:

AYES:

NOES:

ABSTAIN:

JOHN FRANKLIN, MAYOR
APPROVED AS TO FORM: ATTEST:

WALTER CHUNG, CITY ATTORNEY KATHY VALDEZ, CITY CLERK By: By:

APPROVED
Amanda L.Guy
20230102111611
01/10/2023 C4 Page 7 of 153

RESOLUTION NO. 2023-

A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF

THE CITY OF VISTA, CALIFORNIA, APPROVING AN AFFORDABLE

HOUSING AGREEMENT BY AND AMONG THE COMMUNITY

DEVELOPMENT COMMISSION OF THE CITY OF VISTA, THE CITY OF VISTA

AND SANTA FE SENIOR VILLAGE, LP, A CALIFORNIA LIMITED

PARTNERSHIP
The Governing Board of the Community Development Commission of the City of Vista does resolve as follows:

1. Findings. The Commission hereby finds and declares the following:

RESOLUTION NO. 2023-

COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA
PAGE 2
H. In order to implement the affordable housing objectives of the Commission, the Commission proposes to enter into an Affordable Housing Agreement (the "Agreement")with the City and the Developer, under which the Developer would agree to construct the Project in accordance with the requirements of the Agreement, restrict occupancy of certain apartment units in the Project to extremely low income households, very low income households, all as more particularly set forth in the Agreement.

O. The Commission has duly considered all terms and conditions of the proposed Agreement and believes that the Agreement is in the best interests of the Commission and the City and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable State and local law requirements.

P. Under the Agreement, the Developer shall develop the Site as more particularly set forth in the Agreement. The participation of the Commission with respect to the proposed project is described in a staff report on file with the City Clerk (the "Report"). The financial participation by the 01/10/2023 C4 Page 9 of 153

RESOLUTION NO. 2023-

COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA
PAGE 3
Commission under the Agreement is in consideration of the particular uses required by the Agreement to be conducted by Developer on the Site as well as the Developer's undertakings concerning the development and operation of improvements for affordable rental housing.

Q. The Developer has submitted to the Commission and the City Council of the City of Vista (the "City Council") copies of the Agreement substantially in the form submitted herewith.

R. All actions required by all applicable law with respect to the proposed Agreement have been taken in an appropriate and timely manner.

U. The Commission and the City Council have duly considered all of the terms and conditions of the proposed Agreement and believes that the redevelopment of the Site pursuant to the Agreement is in the best interests of the City of Vista and the health, safety, and welfare of its residents, and in accord with the public purposes and provisions of applicable state and local laws and requirements.

2. Action.

A. The Commission hereby approves the Agreement in substantially the form presented to the Commission, subject to such revisions as may be made by the Executive Director of the Commission or his or her designee. The Executive Director is hereby authorized to execute the Agreement on behalf of the City including any attachments thereto on behalf of the Commission. A copy of the Agreement when executed by the Commission shall be placed on file in the office of the Secretary.

B. The Commission authorizes the Executive Director of the Commission (or his or her designee), on behalf of the Commission, subject to obtaining the approval of the City Manager(on behalf of the City) to make revisions to the Agreement which do not increase the City's obligations or materially or substantially increase the Commission's obligations thereunder or materially or substantially change the uses or development permitted on the Site, to sign all 01/10/2023 C4 Page 10 of 153

RESOLUTION NO. 2023-

COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA
PAGE 4
documents, to make all approvals and take all actions necessary or appropriate to carry out and implement the Agreement and to administer the Commission's obligations, responsibilities and duties to be performed under the Agreement and related documents.

3. Adoption. PASSED AND ADOPTED at a meeting of the Governing Board of the Community Development Commission held on January 10, 2023, by the following vote:

AYES:

NOES:

ABSTAIN:

JOHN FRANKLIN, CHAIRPERSON
APPROVED AS TO FORM: ATTEST:

WALTER CHUNG, COMMISSION COUNSEL KATHY VALDEZ, SECRETARY By: By:

APPROVED
Amanda L.Guy
20230102105500
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RESOLUTION NO. 2023-

A RESOLUTION OF THE COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF

VISTA, CALIFORNIA, AMENDING THE CAPITAL PROJECT
BUDGET FOR FISCAL YEARS 2022/23 AND 2023/24
The Community Development Commission does resolve as follows:

1. Findings. The Community Development Commission hereby finds and declares the following:

A. On June 28, 2022, the Community Development Commission adopted Resolution No. 2022-6 approving the Six-Year Capital Improvement Program, the Capital Project Budget for Fiscal Years 2022/23 and 2023/24, and authorizing appropriations for Fiscal Years 2022/23 and 2023/24 capital projects.

B. The Community Development Commission desires to amend the Capital Project Budget at this time to reflect changed circumstances.

2. Action.

A. The Capital Project Budget for Fiscal Years 2022/23 and 2023/24 is amended as set forth in Exhibit A.

3. Adoption. PASSED AND ADOPTED at a meeting of the Community Development Commission of the City of Vista held on January 10, 2023 by the following vote:

AYES:

NOES:

ABSTAIN:

JOHN FRANKLIN, CHAIRPERSON
APPROVED AS TO FORM: ATTEST:

WALTER CHUNG, COMMISSION COUNSEL KATHY VALDEZ, COMMISSION SECRETARY By: By:

APPROVED
Amanda L.Guy
20230102113319
00056394 5 EXHIBIT 3
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RESOLUTION NO. 2023-

COMMUNITY REDEVELOPMENT COMMISSION
PAGE 1 EXHIBIT A

1. Appropriations are hereby made to fund the Santa Fe Senior Village, affordable housing project 8234.

Account Number Account Description Increase Decrease 1220000.310410 FUND BALANCE UNRSRVD/UNDESIGTD $ 297,220 1226630.5789999.8234 SOURCE APPROPRIATION $ 297,220 01/10/2023 C4 Page 13 of 153

AFFORDABLE HOUSING AGREEMENT
by and among the

COMMUNITY DEVELOPMENT COMMISSION

OF THE CITY OF VISTA
and the

CITY OF VISTA
and

SANTA FE SENIOR VILLAGE, LP,
a California limited partnership
EXHIBIT 4
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TABLE OF CONTENTS
Page
DEFINITIONS AND INTERPRETATION..........................................................................................2

2.1. Defined Terms. .............................................................................................................2

2.2. Singular and Plural Terms. ......................................................................................... 14

2.3. References and Other Terms....................................................................................... 14

2.4. Exhibits Incorporated.................................................................................................. 14

2.5. Representations and Warranties.................................................................................. 14

2.6. Commission Representations...................................................................................... 14

2.7. Environmental Condition of the Site. ......................................................................... 16 ESCROW IN CONNECTION WITH THE DEVELOPMENT PROPERTY..................................... 19

3.1. [Reserved]................................................................................................................... 19

3.2. Commission Escrow. .................................................................................................. 19

3.3. Costs of Escrow. ......................................................................................................... 19

3.4. Escrow Instructions..................................................................................................... 19

3.5. Authority of Escrow Holder........................................................................................20

3.6. Closing........................................................................................................................20

3.7. Termination of Commission Escrow. .........................................................................20

3.8. Closing Procedure for the Commission Escrow. ........................................................20 CONDITIONSTO RECORDING.......................................................................................................21

4.1. Commission Conditions Precedent.............................................................................21 SCOPE OF DEVELOPMENT; INSURANCE AND INDEMNITY, FINANCING..........................23

5.1. Scope of Development................................................................................................23

5.2. Design Review............................................................................................................23

5.3. Time of Performance; Progress Reports.....................................................................24

5.4. Cost of Development. .................................................................................................25

5.5. Insurance Requirements..............................................................................................25

5.6. Obligation to Repair and Restore Damage Due to Casualty.......................................26

5.7. Indemnity....................................................................................................................27

5.8. Rights of Access. ........................................................................................................28

5.9. Compliance With Laws...............................................................................................28

5.10. Nondiscrimination in Employment.............................................................................30 i
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TABLE OF CONTENTS (Cont.)

5.11. Taxes and Assessments...............................................................................................30

5.12. Liens and Stop Notices. ..............................................................................................30

5.13. Certificate of Completion. ..........................................................................................30

5.14. Further Assurances......................................................................................................31

5.15. Financing of the Improvements. .................................................................................31 COVENANTS AND RESTRICTIONS ..............................................................................................37

6.1. Use Covenants. ...........................................................................................................37

6.2. Affordable Housing Requirements. ............................................................................37

6.3. Verifications................................................................................................................38

6.4. Maintenance of Site. ...................................................................................................40

6.5. Nondiscrimination Covenants.....................................................................................42

6.6. Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction........................................................................................43 DEVELOPER'S GENERAL REPRESENTATIONS AND WARRANTIES. ...................................43

7.1. Formation, Qualification and Compliance..................................................................43

7.2. Execution and Performance of Project Documents. ...................................................44

7.3. Covenant Not to Transfer Except in Conformity........................................................44 DEFAULTS, REMEDIES, AND TERMINATION............................................................................45

8.1. Default Remedies........................................................................................................45

8.2. Institution of Legal Actions. .......................................................................................45

8.3. Termination by Developer. .........................................................................................45

8.4. Termination by Commission.......................................................................................45

8.5. Acceptance of Service of Process...............................................................................46

8.6. Rights and Remedies Are Cumulative........................................................................46

8.7. Inaction Not a Waiver of Default................................................................................46

8.8. Applicable Law...........................................................................................................46

8.9. Covenant Provisions; Certain Amendments. ..............................................................47

8.10. Enforced Delay; Extension of Times of Performance. ...............................................47

8.11. Transfers of Interest in Agreement or of Site. ............................................................47

8.12. Non-Liability of Officials and Employees of Commission. .......................................49 ii
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TABLE OF CONTENTS (Cont.)

8.13. Relationship Among Commission, City and Developer.............................................49

8.14. Commission and City Approvals and Actions............................................................49

8.15. Real Estate Brokers.....................................................................................................49

8.16. Non-recourse Liability of Developer..........................................................................49 MISCELLANEOUS ............................................................................................................................50

9.1. Obligations Unconditional and Independent...............................................................50

9.2. Notices. .......................................................................................................................50

9.3. Survival of Representations and Warranties...............................................................51

9.4. No Third Parties Benefited Except for City; AB 987.................................................51

9.5. Binding Effect; Assignment of Obligations................................................................52

9.6. Counterparts................................................................................................................52

9.7. Prior Agreements; Amendments; Consents................................................................52

9.8. Governing Law. ..........................................................................................................53

9.9. Severability of Provisions...........................................................................................53

9.10. Headings. ....................................................................................................................53

9.11. Conflicts......................................................................................................................53

9.12. Time of the Essence....................................................................................................53

9.13. Conflict of Interest......................................................................................................53

9.14. Warranty Against Payment of Consideration. ............................................................53 iii
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TABLE OF CONTENTS (Cont.)

ATTACHMENTS
ATTACHMENT NO. 1 MAP OF THE SITE
ATTACHMENT NO. 2 LEGAL DESCRIPTION OF THE SITE
ATTACHMENT NO. 3 SCHEDULE OF PERFORMANCE
ATTACHMENT NO. 4 CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE ATTACHMENT NO. 5 NOTICE OF AFFORDABILITY RESTRICTIONS
ATTACHMENT NO. 6 COMMISSION NOTE
ATTACHMENT NO. 7 REQUEST FOR NOTICE OF DEFAULT
ATTACHMENT NO. 8 SCOPE OF DEVELOPMENT
ATTACHMENT NO. 9 CERTIFICATE OF COMPLETION
ATTACHMENT NO. 10 COMMISSION REGULATORY AGREEMENT
ATTACHMENT NO. I 1 INCOME VERIFICATION
ATTACHMENT NO. 12 COMMISSION DEED OF TRUST
iv
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AFFORDABLE HOUSING AGREEMENT
This AFFORDABLE HOUSING AGREEMENT (the "Agreement"), dated, for identification purposes only, as of January 23, 2023 (the "Date of Agreement"), is entered into by and among the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA, a public body, corporate and politic ("Commission"), the CITY OF VISTA, a charter city duly organized and existing under and by virtue of the Constitution and laws of the State of California ("City") and SANTA FE SENIOR VILLAGE, LP, a California limited partnership (the "Developer").

RECITALS
A. City, as part of its functions as a charter city and municipal corporation under the Constitution and laws of the State of California and in connection with its municipal code is authorized to promote the provision of affordable housing for all income segments of the community. City is authorized to enter into agreements in connection therewith.

B. Commission is acting under this Agreement as a California housing authority acting under the California Housing Authorities Law, Part 2 of Division 24 of the Health and Safety Code (the"Housing Authorities Law").

C. Commission, acting as a housing authority, is authorized and empowered to enter into agreements for the production, improvement, or preservation of affordable housing to households of limited income,with such housing to be available at"Affordable Rent" (as defined herein).

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

E. The Redevelopment Plan for the Vista Redevelopment Project (herein, the "Redevelopment Project") was adopted by Ordinance No. 87-25 by the City Council of the City of Vista on July 13, 1987,and was subsequently amended(as amended,the"Redevelopment Plan"). The redevelopment project area for the Redevelopment Plan as so amended constitutes the"Project Area." F. Developer and/or Parent(s) are experienced in the acquisition, development and operation of affordable multi-family housing,particularly in San Diego County.

K. Developer has obtained title to certain property known by the street address 414 N.

Santa Fe,more particularly described herein as the"Site." L. Developer has proposed the development and operation of an affordable rental housing project at the Site. The proposed project will consist principally of fifty-four(54)rental dwelling units of which fifty-three (53) units shall be restricted on the basis of income and with rents restricted as more particularly provided herein. Developer has obtained various financing commitments for the proposed project including without limitation a reservation of 9% federal housing tax credits, as authorized by the California Tax Credit Allocation Committee on September 28, 2022, reference CA- 22-061 (the"TCAC Approval").
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M. This Agreement is in the vital and best interest of the City and the health, safety and welfare of its residents and furthers the public policies of Commission.

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

DEFINITIONS AND INTERPRETATION

1.1. Defined Terms. As used in this Agreement (and in all other Project Documents, unless otherwise defined), the following capitalized terms shall have the following meanings:
"Adverse Commission Site Determination"has the meaning established therefor in Section

1.6.1. "Affiliated Person" means, when used in reference to a specific person, any person that directly or indirectly controls or is controlled by or under common control with the specified person, any person that is an officer or director of, a trustee of, or a general partner, managing member or operator in,the specified person or of which the specified person is an officer,director,trustee,general partner or managing member, or any person that directly or indirectly is the beneficial owner of ten percent(10%) or more of any class of the outstanding voting securities of the specified person. "Affordable Rent" means rent that does not exceed the maximum rent allowable by TCAC for the corresponding income level(namely, 30%AMI Extremely Low Income Households and 40% AMI Very Low Income Households). In the event TCAC ceases to publish affordable rents for San Diego County, affordable rents shall thereupon be determined in accordance with Health & Safety Code Sections 50052.5 and 50053.
"Applicable Federal Rate"means the interest rate set by the United States Treasury from time to time for the purpose of determining applicable Low Income Housing Tax Credit interest rates. The Applicable Federal Rate is published by the Internal Revenue Service in monthly revenue rulings. "Applicable Interest Rate"means the following rates: (a) as to amounts paid when due with respect to which the Applicable Interest Rate is made applicable by this Agreement,three percent(3%) per annum, simple interest and (b) as to amounts not paid when due, the lesser of(i) seven percent (7%)per annum, simple interest, and(ii)the maximum rate permitted by applicable law. "Approved Construction and/or Permanent Lender" means one or more of Bank of America, California Community Reinvestment Corporation ("CCRC"), Union Bank, Wells Fargo Bank,Citibank,U.S.Bank, Citi Bank,Banner Bank,Century Housing, or another mutually acceptable reputable and established bank, savings and loan association, or other similar financial institution or a state agency or instrumentality, but not Ca1HFA, the Federal National Mortgage Association (Fannie Mae) or Freddie Mae.
"Area"means the San Diego Primary Metropolitan Statistical Area, as periodically defined by HUD.
"Audit"is defined in Section 4.17.1.
"Audited Financial Statement" means an audited financial statement, including without limitation a profit and loss statement, generated by Leaf& Cole, LLP,Novogradac, CohnReznick, or 2 414 N.Santa Fe,v5
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another third party certified public accountant acceptable to Commission in its reasonable discretion, showing, for the previous Regulatory Agreement Year, in an easily readable format, Gross Revenues, Operating Expenses,Debt Service,Capital Replacement Reserve,General Partner Fee,Limited Partner Fee and Residual Receipts.
"Bank Deed of Trust" means a deed of trust, among an Approved Construction and/or Permanent Lender, as beneficiary and Developer as trustor and First American Title Insurance Company or another mutually acceptable title insurer as trustee, in connection with the construction loan provided by an Approved Construction and/or Permanent Lender to Developer. "Base Pro Forma"means that certain pro forma so labelled and dated as of February 8,2022, as on file with the Commission.
"Basic Concept Drawings" is defined in Section 4.2.1 hereof. "Building Permit" means the building permit(s) issued by City and required for the Improvements.
"Capital Replacement Reserve" means a reserve fund to be established by the Developer in an amount as set forth in the Base Pro Forma or as otherwise designated by the Executive Director. To the extent Developer is required to maintain a Capital Replacement Reserve by any Approved Construction and/or Permanent Lender, Developer shall receive a credit hereunder for such amounts maintained by it in compliance with such Approved Construction and/or Permanent Lender capital replacement reserve requirement.
"Certificate of Completion"means Attachment No. 9 to this Agreement. "Certificate of Continuing Program Compliance" means the Certificate to be filed by Developer or its property manager on behalf of Developer with Commission, which Certificate shall be substantially in the form attached hereto as Attachment No. 4. "City", as defined in the first paragraph hereof, means the City of Vista, a charter city duly organized and existing under and by virtue of the Constitution and laws of the State of California. "City Code"means the Municipal Code of the City of Vista as may be amended from time to time.
"City Manager"means the City Manager of the City or his or her designee. "Commencement Date" means the date the Commission Regulatory Agreement is recorded among the Official Records.
"Commission"means the Community Development Commission of the City of Vista,a public body, corporate and politic, acting as a housing authority exercising governmental functions and powers and organized under the Housing Authorities Law, and any assignee of or successor to its rights,powers and responsibilities.
"Commission Conditions Precedent"is set forth in Section 3.1. 3 414 N.Santa Fe,v5
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"Commission Deed of Trust" has the meaning established therefor in Section 2.1 of this Agreement. The Commission Deed of Trust shall be substantially in the form of Attachment No. 12. "Commission Escrow"is described in Section 2.2.
"Commission Loan" means that loan described in Section 2.1 of this Agreement and in the Commission Note.
"Commission Loan Amount"means Five Hundred Thousand Dollars ($500,000.00). "Commission Note" has the meaning established therefor in Section 2.1 of this Agreement.

The Commission Note shall be substantially in the form of Attachment No. 6. "Commission Regulatory Agreement"means Attachment No. 10 to this Agreement. "County"means the County of San Diego, California.
"County HOME Load"means a loan by the County to the Developer for the Development in the original principal amount of Four Million Two Hundred Fifty Thousand Dollars ($4,250,000.00).

The County HOME Loan will be originated and administered by the County in conformity with the HOME Regulations. The County HOME Loan shall be a nonrecourse loan payable from forty three percent (43%) of the Public Agency Share of Residual Receipts. Repayment of the County HOME Loan is to be secured by a deed of trust referred to herein as the"County HOME Loan Deed of Trust." "County HOME Loan Deed of Trust" means a deed of trust as to the Site which secures repayment of the County HOME Loan.
"County Loans"means the County NPLH Loan and the County HOME Loan. "County NPLH Load"means a loan by the County to the Developer for the Development in the original principal amount of Five Million One Hundred Twenty Five Thousand Dollars ($5,125,000.00)using moneys from the No Place Like Home program. The County NPLH Loan will be originated and administered by the County and shall be a nonrecourse loan. The County NPLHG Loan shall be repayable from fifty two percent(52%)of the Public Agency Share of Residual Receipts.

Repayment of the County NPLH Loan is to be secured by a deed of trust referred to herein as the "County NPLH Loan Deed of Trust."
"County NPLH Loan Deed of Trust" means a deed of trust as to the Site which secures repayment of the County NPLH Loan.
"County Regulatory Agreement" means an agreement (or two agreements) restricting affordability and income eligibility on the Site but not securing repayment of either of the County Loans.
"Date of Agreement"means January 23, 2023.
"Debt Service" means required debt service payments for the Primary Construction Loan and/or the Primary Permanent Loan including the funding obligations in respect of all reserves or escrows required thereunder and scheduled payments as approved as part of the Final Financing Package.
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"Default"is defined in Section 7.1 hereof.
"Developer"means Santa Fe Senior Village, LP, a California limited partnership. "Developer Fee" means the sum of Two Million Two Hundred Thousand Dollars ($2,200,000.00).
"Developer Title Policy" is defined in Section 2.8.
"Development" means the apartment complex and associated improvements as required by this Agreement to be: (i) constructed by Developer upon the Site as more particularly described in the Scope of Development, and(ii) operated as an affordable housing complex in conformity with the Commission Regulatory Agreement.
"Environmental Laws" means all laws, ordinances and regulations relating to Hazardous Materials, including, without limitation: the Clean Air Act, as amended, 42 U.S.C. Section 7401, et seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901, et seq.; the Comprehensive Environment Response, Compensation and Liability Act of 1980, as amended (including the Superfund Amendments and Reauthorization Act of 1986, "CERCLA"), 42 U.S.C.

Section 9601, et seq.; the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601 et seq.; the Occupational Safety and Health Act, as amended,29 U.S.C. Section 651,the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Mine Safety and Health Act of 1977, as amended, 30 U.S.C. Section 801 et seq.; the Safe Drinking Water Act, as amended,42 U.S.C. Section 300f et seq.;all comparable state and local laws,laws of other jurisdictions or orders and regulations; and all laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United States, the State, City, or any other political subdivision in which the Site is located, and of any other political subdivision, agency or instrumentality exercising jurisdiction over Commission,Developer, or the Site.
"Escrow Holder" means Fidelity National Title Company,Newport Beach office, or another mutually acceptable escrow holder.
"Event of Default"or"Default"has the meaning set forth in Section 7.1. "Excess Amount"is defined in Section 4.15.
"Executive Director"means the Executive Director of Commission or his or her designee or delegate.
"Final Development Budget" means a detailed enumeration of all projected costs of construction of the Development, including all costs and off-site improvements required to be constructed under this Agreement.
"Final Financing Package" is defined in Section 4.15.1 hereof. "General Partner Fee" means a fee if charged by the general partner; provided that the General Partner Fee together with the Limited Partner Fee shall not for any Regulatory Agreement Year exceed the amount permitted under this Agreement for the Partnership Fees (as such fees are aggregated).
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"Gross Revenues"means the sum of: the total rental income and all other revenues or income received by the Developer or its successors or assigns in connection with the Development, including without limitation Housing Rent,laundry charges(as received by Developer)or consideration received from an entity that contracts to provide laundry services, payments in connection with Section 8 certificates, if any, cable income or consideration received from an entity that contracts to provide cable services,each of(i)amounts paid to Developer or any Affiliated Person on account of Operating Expenses for further disbursement by Developer or such affiliate to a third party or parties, including, without limitation, grants received to fund social services or other housing supportive services at the Development; (ii) late charges and interest paid on rentals; (iii)rents and receipts from licenses, concessions,vending machines,coin laundry,and similar sources;(iv) other fees,charges,or payments not denominated as rental but payable to Developer in connection with the rental of office, retail, storage, or other space in the Development; (v) consideration received in whole or in part for the cancellation, modification, extension or renewal of leases; and (vi) interest and other investment earnings on security deposits, reserve accounts and other Development accounts to the extent disbursed,but does not include: (x)the proceeds of the sale of Tax Credits to finance the Development; (y)Refinancing Net Proceeds (provided the refinancing is permitted by and is accomplished in accordance with this Agreement); (z)insurance proceeds applied to reconstruct or repair the Improvements.
"Hazardous Material" or "Hazardous Materials" means and include any substance, material, or waste which is or becomes regulated by any local governmental authority, including the County, the Regional Water Quality Control Board, the State of California, or the United States Government, including, but not limited to, any material or substance which is: (i) defined as a "hazardous waste,""acutely hazardous waste,""restricted hazardous waste,"or"extremely hazardous waste"under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140, of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law); (ii) defined as a "hazardous substance" under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter Presley Tanner Hazardous Substance Account Act); (iii) defined as a "hazardous material," "hazardous substance," or "hazardous waste" under Section 25501 of the California Health and Safety Code,Division 20,Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); (iv) defined as a "hazardous substance" under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); (v) petroleum; (vi) asbestos and/or asbestos containing materials; (vii) lead based paint or any lead based or lead products; (viii) polychlorinated biphenyls, (ix) designated as a "hazardous substance" pursuant to Section 311 of the Clean Water Act(33 U.S.C. Section 1317); (x) defined as a"hazardous waste"pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (42 U.S.C. Section 6903); (xi) Methyl tertiary Butyl Ether; (xii) defined as "hazardous substances"pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act,42 U.S.C. Section 9601,et seq. (42 U.S.C. Section 9601);(xiii)any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever,which by any"Governmental Requirements" (which shall be deemed to mean the requirements under the provisions of law cited in this definition)either requires special handling in its use,transportation,generation,collection,storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to the environment; and/or (xiv) lead based paint pursuant to and defined in the Lead Based Paint Poisoning Prevention Act,Title X of the 1992 Housing and Community Development Act, 42 U.S.C. § 4800, et seq., specifically §§ 4821-4846, and the implementing regulations thereto. Notwithstanding the foregoing, "Hazardous Materials" shall not include such products in quantities below attainment levels identified in one or more of the enactments identified above as Governmental Requirements,including those products and amounts as are customarily used in the construction, maintenance, rehabilitation, management, 6 414 N.Santa Fe,v5
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operation and residence of residential developments or associated buildings and grounds, or typically used in residential activities in a manner typical of other comparable residential developments, or substances commonly ingested by a significant population living within the Development, including without limitation alcohol, aspirin,tobacco and saccharine. "Hazardous Materials Contamination"means the contamination(whether presently existing or hereafter occurring) of the improvements, facilities, soil, groundwater, air or other elements on, in, or under the Site by Hazardous Materials, or the contamination of the buildings, facilities, soil, groundwater, air or other elements on, in or of any other property as a result of Hazardous Materials at any time (whether before or after the Date of Agreement) emanating from the Site. "HCD" means the Housing and Community Development Department of the State of California. "HOME Program" is defined in Recital A.
"HOME Regulations" means the implementing regulations of the HOME Program set forth at 24 CFR §92.1, et seq. as such regulations now exist (as amended by the 2013 HOME Final Rule) and as they may hereafter be amended, to the extent applicable to the Project. Developer covenants hereunder to comply with the HAL and all applicable HOME Regulations in the performance of this Agreement,whichever are more restrictive. County shall be responsible to assure compliance with the HOME Regulations and neither City nor Commission shall have duties with respect to the HOME Regulations.

In implementation of these requirements, this Agreement, the Project, and all eligible contributions and expenditures hereunder shall conform to the following:
"Housing Rent"means the total of monthly payments by the tenants of a Unit for(a)use and occupancy for the Unit and facilities associated therewith, (b) any separately charged fees or service charges assessed by Developer which are required of all tenants of the Units, other than security deposits, (c) a reasonable allowance for utilities not included in (a) or(b) above, including garbage collection, sewer, water, electricity and gas, as determined by regulation of Housing Authority of the County of San Diego pursuant to 24 C.F.R. Section 5.600 et seq. or by the California Utility Allowance Calculator as permitted by TCAC (unless the cost for utilities is absorbed by Developer), and (d)possessory interest, taxes or other fees or charges assessed for the use of the Units and facilities associated therewith by a public or private entity other than Developer;provided that the rent charged as to any Required Affordable Unit shall not exceed Affordable Rent. Developer has represented to Commission that Developer will absorb all utility costs. "Improvements" means all of the improvements to be constructed for the Development as described in the Scope of Development required to be developed for the benefit of the users of the Site pursuant to this Agreement.
"Income Verification"means Attachment No. 11 to this Agreement. "Indemnitees" is defined in Section 1.6.2.
"Legal Description of the Site"means Attachment No. 2 to this Agreement. "Lender"means a bank or other institutional lender.
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"Limited Partner Fee" means a fee if charged by the limited partner under the Partnership Agreement; provided that the General Partner Fee together with the Limited Partner Fee shall not for any Regulatory Agreement Year exceed the amount permitted under this Agreement for the Partnership Fees (as such fees are aggregated).
"Low and Moderate Income Housing Funds"means moneys which were required under the Redevelopment Law to be deposited into a fund created under Health and Safety Code Section 33334.2 and 33334.3; such moneys were sub subsequently deposited into a Low and Moderate Income Housing Asset Fund maintained by Commission.
"Map of the Site"or"Site Map"means Attachment No. 1 to this Agreement. "Materially Adverse Conditions" are surface or subsurface conditions of the Site which:
(i) are not apparent from a visual inspection of the surface of the Site; and(ii) (a) include the presence of Hazardous Materials at the Site in excess of currently applicable levels permitted under federal or state law, or (b) include the presence of conditions not typically found in properties within City and which a mutually acceptable independent third parry geotechnical and/or environmental assessment and remediation firm retained by Developer estimates will increase development costs by over Three Hundred Thousand Dollars ($300,000.00).
"Median Income" means Median Income for the Area (namely, San Diego County), as set forth by regulation of the California Department of Housing and Community Development pursuant to Health and Safety Code Sections 50079.5 and 50105.
"Milestones" means each of the following: (i)making of the Required Submittals; and (ii) implementing Required Submittal Modifications.
"Monitoring Fee" means an annual fee to be paid by Developer to Commission to assist in defraying the Commission's cost to monitor performance of Developer hereunder. The initial Monitoring Fee shall be One Thousand Dollars ($1,000.00); the Monitoring Fee shall be adjusted annually by the City to reflect increases in the consumer price index for San Diego County. "Notice"means a notice in the form prescribed by Section 8.2 hereof. "Notice of Affordability Restrictions" means an instrument substantially in the form of Attachment No. 5 to this Agreement.
"Official Records" means, unless the context otherwise requires, the official land records of the County Recorder of the County.
"Operating Expenses" means actual, reasonable and customary costs, fees and expenses directly incurred and for which payment has been made and which are attributable to the operation, maintenance, and management of the Development, and consisting of only the following (and such additional items, if any, as to which the prior written approval of the Executive Director is first obtained. Such approval shall be granted, granted subject to conditions, or refused at the sole and absolute discretion of the Executive Director): painting,cleaning,repairs and alterations; landscaping; utilities; rubbish removal; sewer charges; costs incurred to third parties in connection with generating laundry charges (but in no event to exceed the laundry charges); real and personal property taxes and assessments; insurance premiums; security; advertising, promotion and publicity; office, janitorial, 8 414 N.Santa Fe,v5
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cleaning and building supplies; actual and customary salary payable to an on-site manager which directly and exclusively benefits residents of the Development; the actual and customary salary paid for one on-site property manager,one on-site maintenance manager and such other on-site management personnel, if any, which directly and exclusively benefit residents of the Development, subject to the prior written approval of the Executive Director who must act reasonably with regard to such written approval; a management fee ("Management Fee") (excluding any on-site management personnel) equal to the greater of(iv)seventy dollars($70.00)per Unit per month which amount shall be increased at two percent(2%)per annum for any automatic renewal of the agreement or(ii) six percent(6%) of the monthly gross revenue collections from all revenue generating operations conducted on the Site; purchase, repairs, servicing and installation of appliances, equipment, fixtures and furnishings; reasonable and customary fees and expenses of accountants, attorneys, consultants and other professionals as incurred commencing after the completion of the Improvements (as evidenced by the issuance by City of a certificate of occupancy for the corresponding building developed as part of the Improvements) in connection with the operation of the Development by Developer; repayment of loans, if any, made by one or more of the Limited Partners in accordance with the Partnership Agreement;the Limited Partner Fee;the General Partner Fee;tax credit shortfall payments,if any; any unpaid portion of the Developer Fee; on-site service provider fees for tenant social services to the extent approved in writing by the Executive Director, who shall act reasonably, prior to the incurring of such provider fees (and provided that the cost for social services shall not exceed One Hundred Eighty Eight Thousand Dollars ($188,000.00) in any Regulatory Agreement Year, as such amount is adjusted for inflation based upon a three percent 3.0%amount applied per Regulatory Agreement Year measured against the Commencement Date); payments of deductibles in connection with casualty insurance claims not normally paid from reserves; the amount of uninsured losses actually replaced, repaired or restored and not paid from reserves;tenant improvements that are not included in the costs of the Improvements, and payments made by the Developer to satisfy indemnity obligations and other payments by the Developer pursuant to this Agreement other than to the Developer, partners or other related persons; provided, however, that payments to parties related to Developer for Operating Expenses must not exceed market rates. The Operating Expenses shall not include non-cash expenses, including without limitation, depreciation. The Operating Expenses shall be reported in the Audited Financial Statement and shall be broken out in line item detail. "Parent(s)" means each of National Community Renaissance of California, a California nonprofit public benefit corporation and San Diego Community Housing Corporation, a California nonprofit public benefit corporation.
"Partnership Agreement"means the agreement(s)which set(s)forth the terms of Developer's (or its approved Affiliated Persons') limited partnership, as such agreement(s) may be amended from time to time, so long as consistent with the requirements of this Agreement. The Partnership Agreement shall include provisions which incorporate or otherwise conform to the cash flow priorities included in the definition of"Residual Receipts" set forth in this Agreement. "Partnership Fees" means the General Partner Fee and the Limited Partner Fee. For each Regulatory Agreement Year until the seventeenth(17th) anniversary of the Commencement Date,the total Partnership Fees (for the General Partner Fee and the Limited Partner Fee, as aggregated) shall not exceed Twenty Five Thousand Dollars ($25,000.00), adjusted for inflation at three percent(3.0%) per Regulatory Agreement Year measured from the Commencement Date. For each Regulatory Agreement Year after the seventeenth(17th)anniversary of the Commencement Date,the Partnership Fees (the General Partner Fee and Limited Partner Fee as aggregated) shall not exceed Twenty 9 414 N.Santa Fe,v5
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Thousand Hundred Dollars ($20,000.00), adjusted for inflation at three percent(3.0%)per Regulatory Agreement Year measured from the Commencement Date.
"Permitted Senior Lien" means collectively, the deeds of trust securing the Primary Construction Loan and the Primary Permanent Loan.
"Prescribed Income Levels" means the following: (1) thirty four (34) studio Units shall be restricted to 30% AMI Extremely Low Income Households at Affordable Rent; (ii) seventeen (17) studio Units shall be restricted to 40% AMI Very Low Income Households at Affordable Rent; (iii) one (1) one-bedroom Unit shall be restricted to 30% AMI Extremely Low Income Households at Affordable Rent; and(iv)one(1)one-bedroom Unit shall be restricted to 40%AMI Very Low Income Households at Affordable Rent. One Unit for an onsite manager will not be restricted as to income or rent.
"Primary Construction Loan" means, collectively, the mortgage loans and letters of credit obtained by Developer from an Approved Construction Lender. "Primary Permanent Loan"means, collectively, the mortgage loans obtained by Developer from an Approved Permanent Lender in an amount limited to satisfaction of the outstanding balance of the Primary Construction Loan or in an amount in excess of such outstanding balance so long as such excess proceeds are used to pay(or prepay)Developer Fee, and outstanding development costs. "Principals"means Michael Ruane, Theodore T. Miyahara and Parent(s). "Project Documents" means, collectively, this Agreement, the Commission Regulatory Agreement, all other Attachments to this Agreement, and any other agreement, document, or instrument that Commission requires in connection with the execution of this Agreement or from time to time to effectuate the purposes of this Agreement.
"Public Agency Share of Residual Receipts"means fifty percent(50%)of Residual Receipts. "Qualified Permanent Residents" has the meaning established therefor by Section 51.3 of the California Civil Code.
"Recordable Documents" means the following: (i)the Commission Regulatory Agreement; (ii)if applicable, a County regulatory Agreement; (iii)the Bank Deed of Trust; (iv)the County NLPH Loan Deed of Trust;(v)the County HOME Loan Deed of Trust;(vi)such requests for notice of default as are requested to be recorded by Commission; (vii) the Notice of Affordability Restrictions; (viii) 1-UCC Financing Statement by Developer in favor of an Approved Construction and/or Permanent Lender (as construction lender) for filing as a fixture filing among Official Records; and (ix) such other instruments,if any, as shall be approved by Executive Director(upon consultation with Commission's legal counsel) as necessary or convenient to effectuate and implement the initial financing of the Improvements (and the permanent financing thereof). "Redevelopment Plan"means the Redevelopment Plan for the Vista Redevelopment Project (the"Redevelopment Project") first approved by Ordinance No. 87-25 adopted by the City Council of the City on July 13, 1987, as subsequently amended. The Redevelopment Plan is on file with City as a public record.
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"Refinancing Net Proceeds" means the proceeds of any approved refinancing of any of the Primary Construction Loan or the Primary Permanent Loan or other approved financing secured by the interest of Developer in the Site, net of. (i)the amount of the existing financing which is satisfied out of such proceeds; (ii)reasonable and customary costs and expenses incurred in connection with the refinancing; (iii) the costs of improvements to the Site which constitute the Development, including hard and soft costs to the extent approved in writing by the Executive Director prior to the closing of the refinancing;(iv)the balance of loans to the Development made by the limited partners of Developer for development or operating deficits, amounts expended to maintain compliance with the Tax Credit Rules and the terms and conditions of the TCAC Approval, or contributions for capital expenditures in excess of available Project revenues,if any,including interest at the Applicable Federal Rate;(v)the balance, if any, of operating loans or development loans made by the general partners of Developer to the Development,including interest at the Applicable Federal Rate; (vi)payment of unpaid Tax Credit adjustment amounts or reimbursement of Tax Credit adjustment amounts paid by the administrative and/or managing general partners and/or the guarantors to the Development pursuant to the approved Partnership Agreement, if any; and (vii)the payment to the general partner of Developer of a refinancing fee, which fee is and shall be subject to the approval of the Executive Director at the time of each refinancing and which shall not exceed five percent (5%) of the amount of the approved refinancing.
"Regulatory Agreement Year"means the period commencing as of the Commencement Date and ending as of December 31 of that calendar year, then each succeeding calendar year thereafter during the Term of the Commission Regulatory Agreement; provided that the final Regulatory Agreement Year may be a portion of a calendar year.
"Related Entity" means NCRC Santa Fe SV LLC, a California limited liability company; National Community Renaissance of California, a California nonprofit public benefit corporation ("National CORE"); SDCHC Santa Fe Senior LLC, a California limited liability company; and San Diego Community Housing Corporation,a California nonprofit public benefit corporation,or an entity in which any interest is held by Developer or one or more of the Principals. "Relocation"or"Relocation Laws"means all applicable federal and state relocation laws and regulations, including without limitation, (i) the relocation obligations of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 ("URA"), 42 U.S.C. 4201-4655, and the implementing regulations thereto set forth in 49 C.F.R. Part 24, (ii) the California Relocation Assistance Act, Government Code Section 7260, et seq. and the implementing regulations thereto set forth in Title 25, Section 6000, et seq. of the California Code of Regulations, and (iii) any other applicable federal, state or local enactment, regulation or practice providing for relocation assistance, benefits, or compensation for moving and for property interests (including without limitation goodwill and furnishings, fixtures and equipment, and moving expenses), and(iv) any federal law or regulation prohibiting payment of relocation benefits or assistance to persons ineligible for relocation benefits or assistance. Developer shall be solely responsible for payment of any and all costs, expenses, and payments required to be made and/or incurred pursuant to any and all applicable Relocation Laws resulting from activities of Developer; neither City nor Commission shall be responsible for any costs or expenses as a result of the application of the Relocation Laws to the Development or this Agreement or in connection with the acquisition or use of the Site by the Developer or the implementation of this Agreement.
"Reporting Amounts" means the sum of Two Hundred Fifty Dollars ($250.00) per unit per Regulatory Agreement Year for each dwelling unit as to which Developer fails to deliver to 11 414 N.Santa Fe,v5
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Commission, during any Regulatory Agreement Year, a full and adequate report that conforms to Section 33418 of the California Health and Safety Code. "Request for Notice of Default"means Attachment No. 7.
"Required Affordable Units" means dwelling Units required to be developed on the Site under this Agreement, including fifty three (53) apartment units; provided that, in the event a greater number of Units are required to be maintained as affordable units in connection with TCAC approvals, then such greater number shall control and this Agreement, including the attachments hereto, shall be conformed to such greater numbers. In addition to the Required Affordable Units, Developer shall develop one(1) additional Unit which shall be occupied by an on-site manager. It is not contemplated that the Unit for the on-site manager will be restricted on the basis of income. "Required Covenant Period" means the Term of the Commission Regulatory Agreement as more particularly set forth in the Commission Regulatory Agreement. "Required Submittal Modifications"means modifications to a Required Submittal which are reasonably calculated to achieve a reservation of Tax Credits in an amount of not less than the Tax Credit Amount in the next round of Tax Credits; provided that such modifications shall not include any infusion of Commission or City moneys other than those amounts expressly set forth in this Agreement for such purpose.
"Required Submittals"means submittals by Developer for a reservation of Tax Credits during each round that occurs following the Date of Agreement and continuing until the first to occur of (i) Developer obtains a preliminary reservation of Tax Credits in an amount of not less than the Tax Credit Amount;(ii)this Agreement is terminated;or(iii) Commission,at its sole discretion,determines that this provision will be temporarily waived or will no longer be applicable. "Residual Receipts" for a particular Regulatory Agreement Year means Gross Revenues for the corresponding Regulatory Agreement Year less (i)Debt Service payments made during such Regulatory Agreement Year on the Primary Construction Loan or the Primary Permanent Loan in amounts not in excess of the amounts due and payable during such Regulatory Agreement Year (and not including prepayments); and (ii)the sum of(a) Operating Expenses and, to the extent funded, (b)payments made to the Capital Replacement Reserve as made during the corresponding Regulatory Agreement Year up to the amount indicated therefor in the Base Pro Forma. All calculations of Residual Receipts shall be made annually, on or before May 15 for the preceding Regulatory Agreement Year, on a cash (and not accrual) basis and the components thereof shall be subject to verification and approval,on an annual basis,based upon conformity with the terms of this Agreement, by Commission.
"Schedule of Performance" means Attachment No. 3 to this Agreement. The Schedule of Performance sets forth the dates by which Commission and Developer are to perform certain obligations under this Agreement; such dates shall be subject to Section 7.10 of this Agreement. "Scope of Development"means Attachment No. 8 to this Agreement. "Senior Citizen Household" means a household limited to: (i) Senior Citizens and (ii) Qualified Permanent Residents or Permitted Health Care Residents. 12 414 N.Santa Fe,v5
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"Senior Citizens"means persons sixty-two (62)years or older. "Site"means that certain area more particularly described in the Legal Description of the Site. "Surplus Amounts" means amounts, if any, received by Developer from time to time in connection with the rental of Units in excess of the Affordable Rent for such Units (including without limitation moneys received in relation to Section 8 which exceed Affordable Rent). "TCAC"means the Tax Credit Allocation Committee of the State of California. "TCAC Approval"has the meaning set forth therefor in Recital L of this Agreement. "Tax Credit Amount" means that amount which, per the Base Pro Forma, represents the projected yield from the marketing of the Tax Credits under the Base Pro Forma and may not correspond to the amount of tax credits ultimately available. "Tax Credit Application" means, individually and collectively, Developer's Tax Credit application to be submitted to TCAC to obtain an allocation of 9% Tax Credits for the Development or such other financing as may be applied for pursuant to Section 4.15. The Tax Credit Application submitted by Developer shall be consistent with the terms of this Agreement. "Tax Credit Deadline(s)" means December 31, 2022, and, provided that the Milestones are satisfied, later submittal dates for Tax Credits but in no event later than June 30, 2024. "Tax Credit Rent" means that maximum rent permitted to be paid for a household corresponding to an income category set forth in this Agreement(such as a 30%AMI Extremely Low Income Household or a 40%AMI Very Low Income Household under the Tax Credit Rules. "Tax Credit Rules" means Section 42 of the Internal Revenue Code and/or California Revenue and Taxation Code Sections 17057.5, 17058,23610.4 and 23610.5 and California Health and Safety Code Section 50199, et seq., and the rules and regulations implementing the foregoing, including without limitation the program regulations promulgated by TCAC. "Tax Credits" means 9% Housing Tax Credits granted pursuant to Section 42 of the Internal Revenue Code and/or California Revenue and Taxation Code Sections 17057.5, 17058, 23610.4 and 23610.5 and California Health and Safety Code Section 50199, et seq. "Term of the Commission Regulatory Agreement" means a period of fifty eight(58)years commencing as of the Commencement Date.
"Title Company" shall be First American Title Insurance Company or another title insurer mutually acceptable to Commission and Developer.
"Unit"means each of the fifty three(53)dwelling units required to be developed by Developer under this Agreement.
"Veteran(s)" has the meaning, unless the law otherwise requires, as set forth therefor in the Veterans Housing and Homelessness Prevention(VHHP)Program, Program Guidelines as adopted as of February 18,2015,by the State of California, as may be amended from time to time; a copy of such Program Guidelines is on file with the Commission. The definition of Veteran is subject to 13 414 N.Santa Fe,v5
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modification from time to time by mutual agreement of Developer and Commission but shall in all events be subject to applicable law.
"Year" means the period commencing as of the recording of the Commission Regulatory Agreement and ending as of December 31 of that calendar year, then each succeeding calendar year thereafter during the Required Covenant Period terminating as of the last day of the Required Covenant Period.
"30% AMI Extremely Low Income Households" means those households earning not greater than thirty percent (30%) of San Diego County Area Median Income, adjusted for household size,which is set forth by regulation of TCAC.
"30% AMI Extremely Low Income Unit" means a Unit occupied at Affordable Rent by a 30%AMI Extremely Low Income Household.
"40%AMI Very Low Income Households"means those households earning not greater than forty percent(40%) of San Diego County Area Median Income, adjusted for household size,which is set forth by regulation of TCAC.
"40% AMI Very Low Income Unit" means a Unit occupied at Affordable Rent by a 40% AMI Very Low Income Household.

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

1.3. References and Other Terms. Any reference to this Agreement or any Project Document shall include such document both as originally executed and as it may from time to time be modified. References herein to Articles, Sections and Exhibits shall be construed as references to this Agreement unless a different document is named.

References to subparagraphs shall be construed as references to the same Section in which the reference appears. The term"document"is used in its broadest sense and encompasses agreements, certificates, opinions, consents, instruments and other written material of every kind. The terms "including" and "include" mean "including (include) without limitation."

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

1.5. Representations and Warranties.

1.6. Commission Representations. Commission represents and warrants to Developer as follows:

Authori . Commission is a public body, corporate and politic, acting hereunder as a housing authority existing pursuant to the Housing Authorities Law, which has been authorized to transact business pursuant to action of City.Commission has full right,power and lawful authority for the entry into this Agreement and the execution, performance, and delivery of this Agreement by Commission has been fully authorized by all requisite actions on the part of Commission. The parties who have 14 414 N.Santa Fe,v5
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executed this Agreement on behalf of Commission are authorized to bind Commission by their signatures hereto.

No Conflict. Commission's execution, delivery, and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Commission is a party or by which it is bound.

No Commission Bankruptcy. Commission is not the subject of a bankruptcy proceeding.

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

Developer represents and warrants to each of City and Commission as follows:

Authority. Developer is a duly organized limited partnership organized within and in good standing under the laws of the State of California. Developer has full right,power and lawful authority to lease and accept title to and possession of the Site and undertake all obligations as provided herein and the execution,performance and delivery of this Agreement by Developer has been fully authorized by all requisite actions on the part of Developer. The parties who have executed this Agreement on behalf of Developer are authorized to bind Developer by their signatures hereto.

Litigation. To the best of Developer's knowledge,there are no actions, suits, material claims, legal proceedings, or any other proceedings affecting Developer, at law or in equity before any court or governmental agency, domestic or foreign.

No Conflict. Developer's execution, delivery, and performance of its obligations under this Agreement will not constitute a default or a breach under any contract, agreement or order to which Developer is a party or by which it is bound.

No Developer Bankruptcy. Developer is not the subject of a bankruptcy proceeding.

Developer Experience; Sophisticated Party. The Principals of Developer are sophisticated parties,with substantial experience in the acquisition,rehabilitation,development,financing,obtaining financing for, marketing, and operation of affordable housing projects, including rental projects, and with the negotiation, review, and preparation of agreements and other documents in connection with such activities. Developer is familiar with and has reviewed all laws and regulations pertaining to the 15 414 N.Santa Fe,v5
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development and operation of the Development, including without limitation the Tax Credit Rules, and has obtained advice from any advisers of its own choosing in connection with this Agreement.

Developer Knowledge of Site, Suitability. Developer,which is a subsidiary entity of Parent(s), studied the condition of the Site prior to the acquisition of the Site by Parent(s) and Developer is familiar with the condition of the Site. Developer has determined that the Site is suitable for the development proposed by Developer as further described in this Agreement.

Due Authorization and Execution; Studies Completed. Developer has duly authorized the execution of this Agreement, including without limitation the attachments hereto. Developer is ready, willing and able to execute the Commission Regulatory Agreement, and all documents necessary to effectuate the development and operation of the Site in conformity with this Agreement. Prior to the recording of the Commission Regulatory Agreement, Developer shall have caused to be executed and deposited with escrow for recording a loan agreement with an Approved Construction and/or Permanent Lender or memorandum of such agreement if provided by such lender, a Bank Deed of Trust to be recorded on a basis subordinate to each of the Commission Regulatory Agreement, and shall execute and deposit with the Escrow Holder(to be held pending satisfaction of the Commission Conditions Precedent as set forth in Section 3.1 hereunder) the Commission Regulatory Agreement, and all documents necessary to effectuate the recording of the Commission Regulatory Agreement as provided in this Agreement. If the County conditions the provision of the County Loan upon the recording of a County Regulatory Agreement, the County Regulatory Agreement shall also be senior to the Bank Deed of Trust. The deed(s)of trust securing repayment of the County Loans will be senior to the Commission Deed of Trust.

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

1.7. Environmental Condition of the Site.

Developer and/or Parent(s) conducted such studies as they deemed necessary prior to acquiring the Site.

Developer shall save,protect,pay for,defend(with counsel acceptable to each of Commission and City), indemnify and hold harmless each of Commission, City, and their respective elected and appointed officials, officers, employees, attorneys, representatives, volunteers, contractors and agents (collectively, "Indemnitees") from and against any and all liabilities, suits, actions, claims, demands, penalties, damages (including, without limitation, penalties, fines and monetary sanctions), losses, 16 414 N.Santa Fe,v5
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costs or expenses (including, without limitation, consultants' fees, investigation and laboratory fees, reasonable attorneys' fees and remedial and response costs and third-party claims or costs) (the foregoing are hereinafter collectively referred to as "Liabilities") that may now or in the future be incurred or suffered by Indemnitees by reason of, resulting from, in connection with or arising in any manner whatsoever as a direct or indirect result of. (i)the acquisition and/or ownership of the Site; (ii)the ownership and/or use of the Site; (iii) the presence, use, release, escape, seepage, leakage, spillage,emission,generation,discharge,storage,or disposal of any Hazardous Materials in,on,under, or about, or the transportation of any such Hazardous Materials to or from,the Site whether occurring prior to or after the Closing or caused or contributed to by Developer; (iv)the violation, or alleged violation, of any statute, ordinance, order,rule, regulation,permit,judgment, or license relating to the use, generation, release, leakage, spillage, emission, escape, discharge, storage, disposal, or transportation of Hazardous Materials in,on,under,or about,or to or from,the Site(whether occurring before or after the recording of the Commission Regulatory Agreement); (v)the establishment or modification of land use entitlements or land use designations as to the Site; (vi) any claims for relocation benefits or assistance arising from or related to the acquisition,disposition or use of the Site; (vii)the physical and environmental condition of the Site caused or contributed to by Developer or occurring after the Closing; and (viii) any Liabilities caused or contributed to by acts or omissions of Developer relating to any Environmental Laws and other Governmental Requirements relating to Hazardous Materials and/or the environmental and/or physical condition of the Site; provided, however, that Developer shall have no obligation to indemnify Commission and/or City for any liabilities to the extent caused by the gross negligence and/or willful misconduct of either City or Commission. The foregoing indemnification shall continue in full force and effect regardless of whether such condition, liability, loss, damage, cost, penalty, fine, and/or expense shall accrue or be discovered before or after the termination of the Required Covenant Period. This indemnification supplements and in no way limits the indemnification set forth in Section 4.7.

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

Developer hereby waives, releases and discharges forever the Indemnitees from all present and future claims, demands, suits, legal and administrative proceedings and from all liability for damages, losses, costs, liabilities, fees and expenses, including reasonable attorneys' fees, court and litigation costs and fees of expert witnesses,present and future, arising out of or in any way connected with Developer's possession or use of the Site, improvement of the Site, and the ownership and/or use of any other land or improvements located within the corporate limits of the City that is owned by the Developer, Parent(s), or any Related Entity, in accordance with this Agreement, the Scope of Development, and the land use entitlements obtained by Developer for the Development, and for the operation of the Development at the Site of any Hazardous Materials on the Site from the activities of Developer or Parent(s) whether arising prior to or after the Closing, or the existence of Hazardous Materials contamination in any state on, under, or about the Site, from the activities of Developer or 17 414 N.Santa Fe,v5
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arising from and after the Closing;the foregoing shall be subject to the limitations with respect to gross negligence and/or willful misconduct of City or Commission as set forth in Section 1.6.2 hereinabove.

In connection with the foregoing,Developer acknowledges that it is aware of and familiar with the provisions of Section 1542 of the California Civil Code that provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS 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 MUST HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY."
As such relates to this Section 1.6.5, Developer hereby waives and relinquishes all rights and benefits that it may have under Section 1542 of the California Civil Code.

Developer shall notify each of City and Commission upon receipt,and provide to Commission a copy or copies, of the following environmental permits, disclosures, applications, entitlements or inquiries relating to one or more of the Site and the Development: notices of violation, notices to comply, citations, inquiries, clean up or abatement orders, cease and desist orders, reports filed pursuant to self-reporting requirements and reports filed or applications made pursuant to any Environmental Laws and other applicable Governmental Requirements relating to Hazardous Materials and underground tanks, and Developer shall report to each of City and Commission,as soon as possible after each incident, all material information relating to or arising from such incident, including, but not limited to,the following:

All required reports of releases of Hazardous Materials, including notices of any release of Hazardous Materials as required by any Governmental Requirements; All notices of suspension of any permits relating to Hazardous Materials; All notices of violation from federal, state or local environmental authorities relating to Hazardous Materials;
All orders under the State Hazardous Waste Control Act and the State Hazardous Substance Account Act and corresponding federal statutes,concerning investigation,compliance schedules,clean up, or other remedial actions;
All orders under the Porter Cologne Act, including corrective action orders, cease and desist orders, and clean up and abatement orders;
Any notices of violation from OSHA or Cal OSHA concerning employees' exposure to Hazardous Materials;
All complaints and other pleadings filed against Developer relating to Developer's storage, use,transportation, handling or disposal of Hazardous Materials on or about the Site; and 18 414 N.Santa Fe,v5
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Any and all other notices, citations, inquiries, orders, filings or any other reports containing information which would have a materially adverse effect on the Site or Commission's liabilities or obligations relating to Hazardous Materials.

In the event of a release of any Hazardous Materials into the environment, Developer shall, as soon as possible after obtaining knowledge of the release, furnish to each of City and Commission a copy of any and all reports relating thereto and copies of all correspondence with governmental agencies relating to the release. Upon request of City and/or Commission,but subject to any limitations imposed by law or by court order, Developer shall furnish to each of City and Commission a copy or copies of any and all other environmental entitlements or inquiries relating to or affecting the Site in Developer's possession and/or shall notify each of City and Commission of any environmental entitlements or inquiries relating to or affecting the Site within Developer's actual or constructive knowledge if Developer is not in possession of same, including, but not limited to, all permit applications, permits and reports including, without limitation, those reports and other matters which may be characterized as confidential. For all purposes of this Agreement,information in the possession of Parent(s)or one or more Related Entity shall also be deemed to be in the possession of the Developer.

ESCROW IN CONNECTION WITH THE DEVELOPMENT PROPERTY

2.1. [Reservedl.

2.2. Commission Escrow. The parties shall open an escrow(the"Commission Escrow")with the Escrow Holder, by the time established therefor in the Schedule of Performance for the recording of the Commission Regulatory Agreement,and the recordation and delivery of documents described in Section 2.5. Commission and Developer agree to execute such escrow instructions as may be reasonably required to implement this Section 2.6. The obligation of Commission to deliver the Notice of Affordability Restrictions and, if not previously recorded,the Commission Regulatory Agreement,to escrow or to proceed with the recording of the Commission Regulatory Agreement is contingent upon the satisfaction of the Commission Conditions Precedent as set forth in Section 3.1 of this Agreement.

2.3. Costs of Escrow. Developer shall pay all escrow fees,recording charges,title insurance policies incurring the fees, charges, and costs which arise from Escrow.

2.4. Escrow Instructions. This Agreement constitutes the joint escrow instructions of Developer, City and Commission, and the Escrow Holder to whom these instructions are delivered is hereby empowered to act under this Agreement. All funds received in the Commission Escrow shall be deposited with other escrow funds in a general escrow account(s) and may be transferred to any other such escrow trust account in any State or National Bank doing business in the State of California. All disbursements shall be made by check from such account.

If in the opinion of any of Developer,City or Commission it is necessary or convenient in order to accomplish the recording of the Commission Regulatory Agreement, such party may require that the parties sign supplemental escrow instructions; provided that if there is any inconsistency between this Agreement and the supplemental escrow instructions, then the provisions of this Agreement shall control. The parties agree to execute such other and further documents as may be reasonably necessary, helpful or appropriate to effectuate the provisions of this Agreement. The recording of the Commission 19 414 N.Santa Fe,v5
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Regulatory Agreement, as well as the Commission Deed of Trust and the Notice of Affordability Restrictions, shall take place when the Commission Conditions Precedent have been satisfied. Escrow Holder is instructed to release Commission's escrow closing and Developer's escrow closing statements to the respective parties.

2.5. Authority of Escrow Holder. Escrow Holder is authorized to, and shall:

Pay and charge Developer for any title policies ordered by Developer and any lenders.

Disburse funds, record the Recordable Documents in the order set forth in Section 2.2.6 and deliver such documents.

Do such other actions as necessary to fulfill its obligations under this Agreement.

2.6. Closing. The recording of the Commission Regulatory Agreement, and the Notice of Affordability Restrictions, and delivery of documents related shall close ("Closing") within thirty (30) days of the parties' satisfaction of all of the Commission Conditions Precedent, but in no event later than the last day established therefor in the Schedule of Performance. The Schedule of Performance is subject to modification from time to time at the mutual concurrence of City, Commission and Developer, each acting at its sole discretion. The "Closing"means the time and day that all of the Commission Regulatory Agreement, and the Notice of Affordability Restrictions have been recorded by the San Diego County Recorder among the Official Records. The "Closing Date"means the day on which the Closing occurs.

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

2.8. Closing Procedure for the Commission Escrow. Commission Escrow Holder shall close the Commission Escrow for the recording of the Commission Regulatory Agreement as follows:

Record the following documents in this order: (i) the County Regulatory Agreement, if applicable; (ii)the Commission Regulatory Agreement; (iii)the Approved Construction and/or Permanent Lender's deed(s)of trust;(iv)the County NPLH Loan Deed of Trust;(v)the County HOME Loan Deed of Trust; (vi)the Notice of Affordability Restrictions; (vii) a request for notice of default as to any deed of trust recorded as to the Site; (vi) a request for notice of default as to any deed of request recorded as to Site; (viii) such other instruments, if any, as shall be approved by Executive 20 414 N.Santa Fe,v5
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Director(upon consultation with Commission's legal counsel)as necessary or convenient to effectuate and implement the initial financing of the Improvements (and the permanent financing thereof), including any mutually approved subordination agreements(provided that the Commission Regulatory Agreement shall not be subordinated excepting only with the prior written approval of the Executive Director consistent with this Agreement), with instructions for the Recorder of San Diego County, California to deliver to Commission the Commission Regulatory Agreement,the Commission Deed of Trust,and the Notice of Affordability Restrictions and to deliver a certified copy of each to Developer.

Escrow Holder shall also provide to Commission a copy of any other instrument recorded in conjunction with the recording of the Commission Regulatory Agreement. The order of recordation shall be subject to revision upon approval of the Executive Director; Instruct the Title Company to deliver the Developer Title Policy to Developer, with a copy to Commission;
Instruct the Title Company to deliver to Commission the Commission Loan Policy; File any informational reports required by Internal Revenue Code Section 6045(e), as amended, and any other applicable requirements;
Deliver to Commission documents as set forth in Section 2.1.6 hereof, with a copy of each to Developer; and
Forward to both Developer and Commission a separate accounting of all funds received and disbursed for each parry and copies of all executed and recorded or filed documents deposited into Escrow,with such recording and filing date and information endorsed thereon.

CONDITIONS TO RECORDING

3.1. Commission Conditions Precedent. Commission shall not affect the recording of the Commission Regulatory Agreement unless all of the following conditions precedent(the "Commission Conditions Precedent")has been fully satisfied,as determined in good faith by the Executive Director (which condition, if it requires action by Developer, shall also be a covenant of Developer):

Recording of Certain Documents. Each of the Commission Regulatory Agreement,the Notice of Affordability Restrictions, and the remainder of the Recordable Documents has been executed and is in the possession of the Escrow Holder for recording among the Official Records; any documents determined in connection with the Final Financing Package to be executed and delivered have been so executed and delivered and, where required to be recorded, have been recorded; Developer has obtained insurance as to the Site; and Developer has demonstrated to the reasonable satisfaction of the Executive Director that the Commission Regulatory Agreement will be have a senior priority as against deeds of trust, financing agreements, and other encumbrances (excepting those encumbrances which the Executive Director determines to be permissible as encumbrances senior to the and the Commission Regulatory Agreement, with the Executive Director acting at his discretion).

Evidence of Financing. Developer shall have provided written proof acceptable to Commission that Developer has sufficient internal funds and/or has obtained one or more loans or financing, subject to customary conditions, to implement the Development, the financing includes (without limitation) an infusion of not less than the amount of the County Loan from the County, the 21 414 N.Santa Fe,v5
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entirety of financing is equal to or greater than the level of funding for the Development as provided for in the Base Pro Forma, and Commission has approved such evidence of financing, in accordance with all of Section 4.15 hereof, and Commission shall have approved a Final Development Budget and a Final Financing Package. In the event Developer obtains a loan or financing for the construction of the Development, such construction loan or financing for the Development shall be ready to close, and shall close, and a portion of proceeds from the sale of Tax Credits, as provided for in this Agreement and under the Final Financing Package, shall be immediately available for use in constructing the Improvements. The evidence of financing must be consistent with the terms of this Agreement, including without limitation such financing shall be subordinate to the Commission Regulatory Agreement. The evidence of financing shall include a release of certain existing deeds of trust as more particularly set forth in Section 2.1 of this Agreement.

Construction Contract. Developer shall have provided to Commission a signed copy of a stipulated sum or guaranteed maximum price contract between Developer and the general contractor for the construction of the Development, certified by Developer to be a true and correct copy thereof, and Executive Director shall have approved such contractor or contractors, and the construction contract or contracts, pursuant to Section 4.15 hereof. National CORE is hereby approved as general contractor;the terms of a construction contract remain subject to review and approval by Commission.

Agreement Among Creditors as to Lien Priority and Provisions for Payment. Developer shall have provided to Commission evidence reasonably satisfactory to the Executive Director demonstrating that the existing secured creditors described in Section 2.1 of this Agreement are agreeable both to the lien priorities as provided under this Agreement and to the division of Residual Receipts as described in this Agreement.

Payment, Performance and Completion Bonds. Developer or its general contractor shall have obtained payment bonds and performance and completion bonds for the Development, in an amount and from a surety company reasonably acceptable to the Executive Director. All bonds shall be issued by good and solvent sureties qualified to do business in California and shall have a rating of A or better in the most recent edition of Best's Key Rating Guide. Alternatively, Developer may provide a guaranty by one or both of the Parent(s) in lieu of such payment and performance and completion bonds,provided that such guaranty shall be in form acceptable to Commission.

TCAC Approval. All TCAC approvals required in connection with the preliminary reservation of Tax Credits,which shall be deemed to include a preliminary reservation of State tax credits if such tax credits are reflected in the Base Pro Forma,have been obtained in an amount not less than that set forth therefor in the Base Pro Forma and remain in full force and effect.

Title Insurance. The Title Company shall have agreed to deliver to City a lender's policy of title insurance which insures the beneficial interest of City under the New City Deed of Trust subject to priority and conditions or title reasonably acceptable to City.

County Approval. County shall have irrevocably committed not less than the amount of the County Loans as set forth in this Agreement and County shall have confirmed to Commission and to escrow that any conditions precedent to the disbursement of the County Loans have been satisfied.

Insurance. Commission shall have received evidence, satisfactory to Executive Director, that all of the insurance policies required by Section 4.5,below, are in full force and effect. 22 414 N.Santa Fe,v5
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Entitlements and Other Governmental Approvals. Developer shall have obtained and shall have provided to the Executive Director evidence satisfactory to the Executive Director that:
(i)Developer has obtained all governmental approvals, including without limitation entitlements, to construct the Development; (ii) Developer shall have obtained and shall make available written confirmation as to the availability and commitment of the County Loans as well as a preliminary reservation for 9% Tax Credits in an amount of not less than the Tax Credit Amount; and (iii)Developer has obtained all governmental approvals, including without limitation entitlements, to construct all improvements as required under this Agreement.

Readiness. Developer shall have provided to the Executive Director evidence satisfactory to the Executive Director that: (i)Developer is, subject to the recording of the Commission Regulatory Agreement occurring, immediately ready, willing, able and committed to construct the Development and thereupon operate the Development in conformity with this Agreement; and (ii) Developer is immediately ready, willing, able and committed to effect all construction as required under this Agreement and that all conditions precedent to financing and implementation of the Development have been satisfied.

Representations and Warranties. The representations and warranties of Developer contained in this Agreement shall be correct as of the recording of the Commission Regulatory Agreement as though made on and as of that date, and Executive Director shall have received a certificate to that effect signed by an officer of Developer.

No Default. No Default by Developer shall have occurred under this Agreement or any other agreement between Commission and Developer and/or its officers or employees, no event shall have occurred which,with the giving of notice or the passage of time or both,would constitute a Default by Developer under this Agreement, and Executive Director shall have received a certificate to that effect signed by an officer of Developer.

All conditions set forth in Section 3.1, or to Commission's obligations hereunder, are for Commission's benefit only and Executive Director may waive all or any part of such rights by written notice to Developer. If Executive Director shall, within the applicable periods set forth herein, disapprove of any of the items which are subject to Commission's approval, or if any of the conditions set forth in this Agreement are not met within the times called for, Commission may thereafter terminate this Agreement without any further liability on the part of Commission by giving written notice of termination to Developer.

SCOPE OF DEVELOPMENT; INSURANCE AND INDEMNITY, FINANCING

4.1. Scope of Development. Developer shall develop the Improvements in accordance with the Scope of Development, and the approved plans, drawings and documents for the Improvements. In the event of any inconsistency between the Scope of Development and the plans for the Improvements which have been approved by Commission and/or City, the approved Development plans shall control.

4.2. Design Review.

Prior to the Date of Agreement, in connection with its application for land use approvals by City, Developer has applied for land use approvals, including environmental clearance required by City or otherwise legally required,for the development of the Improvements;such land use approvals are more fully described in the Scope of Development. Developer has submitted"Basic Concept Drawings"for 23 414 N.Santa Fe,v5
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the Improvements. The Improvements include site improvements and fifty four (54) rental Units (inclusive of the manager's unit), as well as various amenities, as more particularly described in the Scope of Development. Before commencement of construction of the Improvements or other works of improvement upon the Site, Developer shall submit to City any plans and drawings (collectively, the"Design Development Drawings")which may be required by City with respect to any permits and entitlements which are required to be obtained to develop the Improvements,which City shall comment on and return to Developer within thirty (30) days from the date of receipt thereof. Developer, on or prior to the date set forth in the Schedule of Performance, shall submit to City such plans for the Improvements as required by City in order for Developer to obtain building permits for the Improvements. Within thirty (30) days after City's disapproval or conditional approval of such plans, Developer shall revise the portions of such plans identified by City as requiring revisions and resubmit the revised plans to City.

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

Any and all change orders or revisions required by City and its inspectors under the City Code including without limitation all applicable Uniform Codes (e.g., Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and regulations shall be included by Developer in its Design Development Drawings and other required submittals and shall be completed during the construction of the Improvements.

Commission and City shall not be responsible either to Developer or to third parties in any way for any defects in the Design Development Drawings, nor for any structural or other defects in any work done according to the approved Design Development Drawings, nor for any delays reasonably caused by the review and approval processes established by this Section 4.2.4.

Before commencement of construction of the Improvements or other works of improvement upon the Site, Developer shall, at its own expense, secure or cause to be secured any and all land use and other entitlements,subdivision and/or subdivided land grounds,permits,and approvals which may be required for the Improvements by City or any other governmental agency affected by or having jurisdiction over such construction or work, except for those which are the responsibility of Commission as set forth herein, including without limitation a license agreement between Developer and City allowing entry onto the Site which indemnifies City and Commission from any claims made in connection with the activities of Developer. Developer shall, without limitation, apply for and secure, and pay all costs, charges and fees associated therewith, all permits and fees required by City, County, and other governmental agencies with jurisdiction over the Improvements.

4.3. Time of Performance; Progress Reports. Developer shall submit all Design Development Drawings, commence and complete all construction of the Improvements, and satisfy all other obligations and conditions of this Agreement within the times established therefor in this Agreement. Construction of the Improvements shall be commenced on or before the time established therefor in the Schedule of Performance.

Once construction is commenced, it shall continuously and diligently be pursued to completion and shall not be abandoned for more than thirty(30)days except when due to causes beyond the control and without the fault of Developer as set forth in Section 7.1(e). 24 414 N.Santa Fe,v5
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During the course of construction and prior to issuance of the Certificate of Completion, Developer shall provide timely reports of the progress of construction when requested by the Executive Director. Developer shall complete construction of all of the Improvements on the Site within twenty (20)months after the first to occur of (i) commencement of construction or (ii)the time established by this Agreement for commencement of construction.

4.4. Cost of Development. The cost of planning,designing,developing,and constructing the Improvements shall be borne solely by Developer; provided that provisions concerning the availability of the Commission Loan shall be applicable as provided herein. All fees imposed by any governmental entity in connection with the acquisition of the Site or the development of the Improvements shall be borne by Developer and shall be paid when due by Developer. Developer shall be responsible for and bear the costs,if any,associated with the application of Relocation Laws to the Development to the extent described above within the definition of"Relocation." Developer shall pay to City,or cause to be disbursed by the lender making the Primary Construction Loan to City, all of the City fees payable as of such time not later than concurrently with the closing of the Primary Construction Loan.

4.5. Insurance Requirements. Commencing as of recording of the Commission Regulatory Agreement and continuing throughout the Required Covenant Period, and, in addition at all times during which Developer is conducting work on the Site or any portion thereof, including times prior to the recording of the Commission Regulatory Agreement, Developer shall maintain at Developer's sole expense,with insurers reasonably approved by Commission, the following policies of insurance in form and substance reasonably satisfactory to Commission:
workers' compensation insurance(if Developer has any employees)and(in addition to such insurance as is described in subsections (b), (c), (d) and(e) of this Section 4.5), additional other insurance to the extent and with limits as required by law in connection with the Improvements or other work performed on the Site (to be in effect only while work is being performed on the Site); prior to the commencement of construction of the Improvements and at all times prior to completion of the Improvements, builder's risk-all risk insurance covering 100% of the replacement cost of all Improvements (including offsite and the materials) during the course of construction in the event of fire, lightning, windstorm, vandalism, earthquake, malicious mischief and all other risks normally covered by "all risk" coverage policies in the area where the Site is located (including loss by flood if the Site is in an area designated as subject to the danger of flood); following completion of the Improvements,fire and hazard"all risk"insurance covering 100% of the replacement cost of the Improvements in the event of fire, lightning, windstorm, vandalism, earthquake, malicious mischief and all other risks normally covered by"all risk" coverage policies in the area where the Site is located(including loss by flood if the Site is in an area designated as subject to the danger of flood);
public liability insurance in amounts reasonably required by the Executive Director from time to time, and in no event less than$2,000,000 for"single occurrence;" 25 414 N.Santa Fe,v5
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property damage insurance in amounts reasonably required by the Executive Director from time to time, and in no event less than $2,000,000; and all other insurance reasonably required by the Executive Director from time to time.

All such insurance shall provide that it may not be canceled or materially modified without 30 days' prior written notice to Commission. The policies required under subparagraphs (b) and(c) shall include a "lender's loss payable endorsement" (Form 438BFU) in form and substance satisfactory to Commission, showing each of City and Commission as an additional insured and loss payee. Each of City and Commission shall be an additional insured in the policies required under subparagraphs (d) and(e). No such insurance shall include deductible amounts to which Commission has not previously consented in writing. Certificates of insurance for the above policies (and/or original policies, if required by Commission) shall be delivered to Commission from time to time within 10 days after demand therefor. All policies insuring against damage to the Improvements shall contain an agreed value clause sufficient to eliminate any risk of co-insurance. No less than thirty (30) days prior to the expiration of each policy,Developer shall deliver to Commission evidence of renewal or replacement of such policy reasonably satisfactory to the Executive Director.

Coverage provided hereunder by Developer shall be primary insurance and not be contributing with any insurance maintained by Commission or City, and the policy shall contain such an endorsement. The insurance policy or the endorsement shall contain a waiver of subrogation for the benefit of City and Commission. None of the above-described policies shall require Developer to meet a deductible or self-insured retention amount of more than Ten Thousand Dollars ($10,000.00)unless approved in writing by the Executive Director. All policies shall be written by good and solvent insurers qualified to do business in California and shall have a policyholder's rating of A- or better in the most recent edition of`Best's Key Rating Guide--Property and Casualty." The required certificate shall be furnished by Developer at the time set forth herein.

Developer hereby waives all rights to recover against Commission or City (or any officer, employee, agent or representative of Commission or City) for any loss incurred by Developer from any cause insured against or required by any Project Document to be insured against; provided, however, that this waiver of subrogation shall not be effective with respect to any insurance policy if the coverage thereunder would be materially reduced or impaired as a result. Developer shall use its best efforts to obtain only policies which permit the foregoing waiver of subrogation.

4.6. Obligation to Repair and Restore Damage Due to Casualty. If during the period of construction the Improvements shall be totally or partially destroyed or rendered wholly or partly uninhabitable by fire or other casualty required to be insured against by Developer, Developer shall promptly proceed to obtain insurance proceeds and take all steps necessary to begin reconstruction and, immediately upon receipt of insurance proceeds, to promptly and diligently commence the repair or replacement of the Improvements to substantially the same condition as the Improvements are required to be constructed pursuant to this Agreement, whether or not the insurance proceeds are sufficient to cover the actual cost of repair, replacement, or restoration, and Developer shall complete the same as soon as possible thereafter so that the Improvements can be occupied as an affordable housing project in accordance with this Agreement. In no event shall the repair,replacement,or restoration period exceed fifty three(53)months from the date Developer obtains insurance proceeds unless the Executive Director,in his or her sole and absolute discretion, approves a longer period of time. Commission shall cooperate 26 414 N.Santa Fe,v5
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with Developer, at no expense to Commission, in obtaining any governmental permits required for the repair,replacement, or restoration. If,however,the then-existing laws of any other governmental agencies with jurisdiction over the Site do not permit the repair, replacement, or restoration, Developer may elect not to repair, replace, or restore the Improvements by giving notice to Commission(in which event Developer will be entitled to all insurance proceeds after paying to Commission from such proceeds an amount equal to any assistance expended by Commission in connection with the Site and, if applicable, any facilities not located on the Site which serve the residents of the Site, but Developer shall be required to remove all debris from the Site) or Developer may reconstruct such other improvements on the Site as are consistent with applicable land use regulations and approved by City, Commission, and the other governmental agency or agencies with jurisdiction,and Commission may pursue remedies of its choosing under this Agreement, including without limitation termination.

4.7. Indemnity. Developer shall defend(by counsel satisfactory to Commission), indemnify and save and hold harmless the Indemnitees from and against all claims, damages, demands, actions, losses, liabilities, costs and expenses (including, without limitation, reasonable attorneys' fees and court costs) arising from or relating to: (i)Developer's obligations under this Agreement (including without limitation Section 4.9 hereof); (ii)the use of federal funds for the Development and compliance, vel non, with respect thereto; (iii) compliance with applicable laws and the terms and conditions of the TCAC Approval; (iv) a claim, demand or cause of action that any person has or asserts against Developer;(v) any act or omission of Developer,any contractor,subcontractor or material supplier, engineer, architect or other person with respect to the Site; (vi) any claims for relocation benefits or assistance arising from or related to the acquisition, disposition or use of the Site; (vii) any claim,loss or liability arising from or related to the acquisition of the Site by Developer or a Related Entity, dealings any occupants of the Site; (viii)the establishment or modification of land use entitlements or land use designations as to the Site; (ix)Developer's ownership, occupancy or use of the Site; or (x) any relocation claims related in any manner to this Agreement. Notwithstanding the foregoing, Developer shall not be obligated to indemnify the Indemnitees with respect to the consequences of any act of gross negligence, sole active negligence,or willful misconduct of any of the Indemnitees. Developer's obligations under this Section 4.7 shall survive the issuance of the Certificate of Completion and termination of this Agreement; the requirements under this Section 4.7 are in addition to and do not limit the obligations of Developer under the Commission Regulatory Agreement.

Developer shall reimburse Commission immediately upon written demand for all costs reasonably incurred by Commission (including the reasonable fees and expenses of attorneys, accountants, appraisers and other consultants, whether the same are independent contractors or employees of Commission) in connection with the enforcement of the Project Documents and all related matters including the following: (a) Commission's commencement of, appearance in, or defense of any action or proceeding purporting to affect the rights or obligations of the parties to any Project Document, and (b) all claims, demands, causes of action, liabilities, losses, commissions and other costs against which Commission is indemnified under the Project Documents. Such reimbursement obligations shall bear interest based upon the amounts and times of disbursement by Commission,provided that Commission gives written demand to Developer at the Applicable Interest Rate. Such reimbursement obligations shall survive the issuance of the Certificate of Completion and termination of this Agreement and are in addition to and do not limit the obligations of Developer 27 414 N.Santa Fe,v5
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under the Commission Regulatory Agreement. In the event of any inconsistency between this paragraph and the provisions of Section 7.16,the provisions of Section 7.16 shall control.

Developer shall indemnify each of City and Commission from any real estate commissions or brokerage fees which may arise from this Agreement or the Site, including without limitation the acquisition of the Site by Developer,or the leasing of dwelling units on the Site. Developer represents that it has engaged no broker,agent,or finder in connection with this transaction,and Developer agrees to hold each of City and Commission harmless from any claim by any broker, agent or finder in connection with this Agreement,the activities by Developer, or the Site.

In addition,and without limitation to the foregoing,Developer agrees to indemnify,defend and hold Commission harmless from and against any claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense (including, without limitation, reasonable attorneys' fees), resulting from, arising out of, or based upon(i)the presence, release,use, generation, discharge, storage or disposal of any Hazardous Materials on, under, in or about, or the transportation of any such Hazardous Materials to or from, the Site caused or contributed to by Developer or which occurs after the Closing,or(ii)the violation, or alleged violation,by Developer or anyone acting by or through Developer, of any statute, ordinance, order, rule, regulation, permit, judgment or license relating to the use, generation, release, discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or from, the Site which is caused or contributed to by Developer or which occurs after the Closing. This indemnity shall include, without limitation, any damage, liability, fine,penalty,parallel indemnity after closing cost or expense arising from or out of any claim, action, suit or proceeding for personal injury(including sickness, disease or death), tangible or intangible property damage, compensation for lost wages,business income,profits or other economic loss, damage to the natural resource or the environment, nuisance, contamination, leak, spill, release or other adverse effect on the environment. At the request of Developer, Commission shall cooperate with and assist Developer in its defense of any such claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense; provided that Commission shall not be obligated to incur any expense in connection with such cooperation or assistance. Notwithstanding anything contained herein to the contrary,Developer shall not indemnify Commission for any claims arising from Commission's gross and active negligence or Commission's willful misconduct.

4.8. Rights of Access. Prior to the issuance of the Certificate of Completion, for purposes of assuring compliance with this Agreement, representatives of Commission and City shall have the right of access to the Site, without charges or fees, at normal construction hours during the period of construction for the purposes of this Agreement, including but not limited to, the inspection of the work being performed in constructing the Improvements so long as Commission representatives comply with all safety rules. Commission representatives shall, except in emergency situations, notify Developer seventy-two (72) hours prior to exercising its rights pursuant to this Section 4.8. In addition,representatives of City shall have access to the Site in connection with the enforcement of laws,including without limitation the City Code to the extent used in connection with the exercise of police powers of City without regard to any limitations otherwise set forth in this Section 4.8.

4.9. Compliance With Laws. Developer shall carry out the design, construction and operation of the Improvements in conformity with all applicable laws, including all applicable state labor standards and federal prevailing wage laws (including without 28 414 N.Santa Fe,v5
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limitation provisions for payment of prevailing wages in connection with all construction of the Improvements to the extent applicable), City zoning and development standards, building, plumbing, mechanical and electrical codes, and all other provisions of the City Code, and the Fair Housing Act,42 U.S.C. Section 3601 et seq. (and 24 C.F.R. Part 100), the Americans With Disabilities Act,42 U.S.C. Section 12101,et seq.,Government Code Section 4450, et seq., Government Code Section 11135, et seq., the Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards Code, Health and Safety Code Section 18900, et seq. Developer, including but not limited to its contractors and subcontractors, shall comply with Labor Code Section 1720, et seq., and its implementing regulations, regarding the payment of prevailing wages (the "State Prevailing Wage Law") and, if applicable, federal prevailing wage law ("Federal Prevailing Wage Law" and, together with State Prevailing Wage Law, "Prevailing Wage Laws")with regard to the construction of the Improvements,but only if and to the extent such sections are applicable to the development of the Improvements. Developer shall be solely responsible for determining and effectuating compliance with any applicable Prevailing Wage Laws, and Commission or City make no final representation as to the applicability or non-applicability of the Prevailing Wage Laws to the Improvements, or any part thereof. Developer hereby releases from liability, and agrees to indemnify, defend, assume all responsibility for and hold each of Commission and City, and their respective officers, employees, agents and representatives, harmless from any and all claims,demands,actions,suits,proceedings,fines,penalties,damages,expenses resulting from, arising out of, or based upon Developer's acts or omissions pertaining to the compliance with the Prevailing Wage Laws for the Improvements.

Developer shall further be responsible for compliance with all agreements between the County and Developer concerning the Development, as well as compliance with the terms and conditions of the TCAC Approval.

This Agreement, including without limitation the amount of the Commission Loan, assumes that prevailing wages will be paid in connection with the construction of the Improvements of the greater of the amounts required (under Federal Prevailing Wage Law or State Prevailing Wage Law, whichever is applicable). In the event Developer contends that Developer is not required to pay prevailing wages under one or both of the State Prevailing Wage Law or the Federal Prevailing Wage Law,Developer shall so inform Commission in writing not less than sixty(60)days before the Closing.

Upon receipt of such writing, Commission shall review whether and in what amount the Commission Loan shall be reduced. Commission, acting through its Executive Director, will consider information submitted by Developer with respect to this matter, but the determination of Executive Director as to the amount of the Commission Loan in such event, to be made at the sole discretion of Executive Director, shall be final.

Subject to Section 4.7 of this Agreement, Developer shall indemnify,protect, defend and hold harmless Commission and its officers, employees, contractors and agents, with counsel reasonably acceptable to Commission, from and against any and all loss, liability, damage, claim, cost, expense and/or "increased costs" (including reasonable attorney's fees, court and litigation costs, and fees of expert witnesses) which, in connection with the development, construction, and/or operation of the Improvements, including, without limitation, any and all public works (as defined by applicable law), results or arises in any way from any of the following: (1)the noncompliance by Developer of any applicable local, state and/or federal law, including, without limitation, any applicable federal and/or state labor laws (including, without limitation, if applicable, the requirement to pay state prevailing 29 414 N.Santa Fe,v5
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wages and/or federal prevailing wages); (2)the implementation of Section 1781 of the Labor Code, as the same may be amended from time to time, or any other similar law; and/or(3) failure by Developer to provide any required disclosure or identification as required by Labor Code Section 1781, as the same may be amended from time to time, or any other similar law. It is agreed by the parties that, in connection with the development of the Improvements,including,without limitation,any and all public works (as defined by applicable law), Developer shall bear all risks of payment or non-payment of prevailing wages under California law and/or the implementation of Labor Code Section 1781, as the same may be amended from time to time, and/or any other similar law. "Increased costs," as used in this Section 4.9, shall have the meaning ascribed to it in Labor Code Section 1781, as the same may be amended from time to time. The foregoing indemnity shall survive termination of this Agreement and shall continue after completion of the construction and development of the Improvements by Developer.

4.10. Nondiscrimination in Employment. Developer certifies and agrees that all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding companies are and will be treated equally by it without regard to,or because of race,color, religion, ancestry, national origin, sex, sexual orientation, age (excepting as otherwise provided herein as to restriction of the Required Affordable Units to Senior Citizen Households), pregnancy, childbirth or related medical condition, medical condition (cancer related) or physical or mental disability.

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

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

4.13. Certificate of Completion. Promptly after completion of the Improvements in conformity with this Agreement, if requested to do so in writing by Developer, Commission shall furnish Developer with a"Certificate of Completion," substantially in the form of attached hereto. Commission shall not unreasonably withhold such Certificate 30 414 N.Santa Fe,v5
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of Completion. The Certificate of Completion shall be a conclusive determination of satisfactory completion of the Improvements and the Certificate of Completion shall so state. If Commission refuses or fails to furnish a Certificate of Completion after written request from Developer, Commission shall, within thirty (30) days of receipt of written request therefor, provide Developer with a written statement of the reasons Commission refused or failed to furnish the Certificate of Completion. The statement shall also contain Commission's opinion of the actions Developer must take to obtain the Certificate of Completion. The Certificate of Completion is not a notice of completion as referred to in Section 3093 of the California Civil Code.

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

4.15. Financing of the Improvements. Financing shall be provided consistent with the Final Financing Package.

Developer shall submit to Commission evidence reasonably satisfactory to the Executive Director that Developer has obtained sufficient equity capital or has arranged for and obtained a binding commitment for construction financing necessary to undertake the development of the Site and the construction of the Improvements in accordance with this Agreement ("Proof of Financing Commitments"). This requirement shall be implemented as follows: on or before the time set forth in the Schedule of Performance for the recording of documents, but not later than forty-five (45) days prior to Closing, and prior to taking possession of the Site, Developer shall submit to the Executive Director a proposed final financing package (the "Initial Proposed Financing Package") which identifies all funding, including sources, amounts, timing and mechanics for disbursement, sufficient to finance the development of the Improvements in conformity with this Agreement and is consistent with the Base Pro Forma. It is contemplated that Commission shall not provide financial assistance excepting to the extent expressly provided herein for the provision of financial assistance. Upon receipt of such submittal from Developer of the Initial Proposed Financing Package, the Executive Director (and nominees of his choosing for this purpose) will review the Initial Proposed Financing Package and will confer with Developer regarding the Initial Proposed Financing Package. The Executive Director may make suggestions and propose modifications or substitutions to the Initial Proposed Financing Package. The parties contemplate that more than one submittal may be necessary to achieve a submitted financing package that is approved by the Executive Director, and that a consultative process shall occur in connection with each such submittal. At such point as the Executive Director may determine, in his or her reasonable discretion,to approve a proposed financing package, upon approval by the Executive Director, such financing package shall be referred to as the "Final Financing Package." Attachments hereto shall be subject to change by the terms of the Final Financing Package. On behalf of the Commission, in his or her discretion, the Executive Director may deem the Initial Proposed Financing Package to be the Final Financing Package.

Required Financing Submittals; Submittal of Construction Contract. Such evidence of financing for the Development and readiness to commence construction of the Development shall include all of the following:
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An updated pro forma and final development budget for the Development, including the Initial Proposed Financing Package, showing the projected costs of construction of the Development, including all onsite and offsite improvements to be constructed in connection therewith.

A copy of the lender's firm commitment obtained by Developer for the Primary Construction Loan for the Development and, when available, copies of all loan documents evidencing the Primary Construction Loan therefor. The Primary Construction Loan commitments for financing shall be in such form and content acceptable to Commission and its financial advisor(s) and its legal advisor(s) and as such reasonably evidences a legally binding, firm and enforceable commitment, subject only to the Lender's customary and normal conditions and terms and subject to the requirements of this Section 4.15. Developer shall provide written certification to Commission that the loan documents submitted are correct copies of the actual loan documents to be executed by Developer concurrently with the Closing. If the Lender requires a subordination agreement between or among Lender, Commission and/or Developer, Commission shall review the form of subordination subject to the reasonable review and approval of the Executive Director and legal counsel(s), subject to one or more of the conditions set forth in Section 4.15.6 necessary for the Primary Construction Loan to be a title insured first monetary lien on the Development. Any financial commitment must provide that it will be subordinate to the Commission Regulatory Agreement.

A current certified financial statement of Developer (and all partners and members thereof, except the Investor Limited Partner) and/or other documentation satisfactory to Commission as evidence of other sources of capital sufficient to demonstrate that Developer has adequate funds to cover the difference, if any, between construction and completion costs, and the financing authorized by the Tax Credits, Primary Construction Loan, and any additional subsidies, sources of funding, or financing obtained by Developer for the development of the Development.

Copies of the construction contract(s).

Commission,which may act through its Executive Director, shall have the right to approve or disapprove such evidence of financing within fifteen (15) business days of submission by Developer to Commission of all complete items required by this Section 4.15 or as otherwise reasonably imposed by Developer's financing and such approval or disapproval shall be provided not less than fifteen(15) business days prior to the date scheduled for the Closing (so long as Commission has had no fewer than thirty(30) days for review of a complete submittal). Failure by Commission to approve evidence of financing shall constitute disapproval. In this regard, Developer agrees it shall use best efforts to cause its Primary Construction Lender to timely provide complete drafts of documents for review by Commission and its legal counsel(s) to perform within such time frames. Approval shall not be unreasonably withheld or conditioned; provided that any financial commitment must provide that it will be subordinate to the Commission Regulatory Agreement. If Commission disapproves any such evidence of financing, Commission shall do so by written notice to Developer stating the reasons for such disapproval and Developer shall promptly obtain and submit to Commission new evidence of financing within reset but equal time periods. If Developer's submission of new evidence of financing is timely and complete and provides Commission with adequate time to review such evidence within the times established in this Section 4.15, Commission shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 4.15 for the approval or disapproval of the evidence of financing as submitted to Commission initially. The Closing shall be extended as necessary to accommodate the time necessary to obtain the Executive Director's approval hereunder.
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The evidence of financing shall be deemed to be an ongoing representation by Developer that the sum total of all sources of financing are at least equal to the amount of the approved Project costs as set forth in the Final Development Budget for the Development and that such Final Development Budget conforms to the Tax Credit Application and the preliminary reservation of Tax Credits, and any and all updates thereto submitted by Developer to TCAC. Once the complete evidence of financing is approved by Commission, Developer shall promptly notify Commission in writing of any change in, additional conditions to, or additional sources of financing, including without limitation,the award of state or federal Tax Credits, and any updates or additional information material or relevant to such financing and/or the Tax Credits. The representations made by Developer with respect to the budgets and costs for the Development and the sources of funding and method of financing for the Development, inclusive of all submittals and information related to the Tax Credits, were and remain the basis used by Commission to negotiate the financial terms of this Agreement.

4.15.1.1. Tax Credit Equity. The parties intend that Developer is to obtain equity financing for the construction and operation of the Development including the use of Tax Credits and obtaining capital contributions from limited partners in Developer in consideration primarily for the receipt of the Tax Credits received by Developer with respect to the Development.

In the event a preliminary reservation of Tax Credits is not obtained by Developer by the Tax Credit Deadline, this Agreement shall be subject to termination by Commission. The following requirements must be satisfied in order for the equity financing for Tax Credit funding for the Development to be approved by Commission pursuant to this Section

4.15:

Developer understands and agrees that Developer and/or Parent(s)may be required to provide an operating deficit guaranty, tax credit recapture guaranty, and/or other guaranties which may be required with respect to the limited partners' investment in the Development. If required for such financing,the execution of such guaranties shall be an additional Condition Precedent for the purposes of Section 3.1.

Developer shall submit the following documents as evidence of financing prior to the time set forth in the Schedule of Performance for the recording of documents, but not later than the Closing:
(a) a copy of a legally binding, firm and enforceable loan commitment(s) or approval(s) obtained by Developer from unrelated financial institutions for the mortgage loan or loans for financing to fund the construction of the Development,subject to such lenders'reasonable,customary and normal conditions and terms, (b) a limited partnership agreement or funding agreement from the equity investors in the Development which demonstrates that Developer has sufficient funds for such construction, and that such funds have been committed to such construction, and a current financial statement of Developer, (c) a copy of a Preliminary Reservation of Tax Credits from the California Tax Credit Allocation Committee for Tax Credits for the construction of the Development, (d) a binding agreement for the purchase of the Tax Credits, and/or (e) other documentation satisfactory to Commission as evidence of other sources of capital, all of which together are sufficient to demonstrate that Developer has adequate funds to construct and complete the Development.

The equity investment of the limited partners of the limited partnership shall not be less than the approximate prevailing price for 9%Tax Credits at such time,taking into consideration all relevant factors such as timing of required payments and amount of the Tax Credits. 33 414 N.Santa Fe,v5
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The identity of the limited partners of the limited partnership shall be reasonably acceptable to the Executive Director, Commission financial advisor(s), and legal counsel(s).

Required Submissions. Developer shall submit the following documents as evidence of Tax Credit financing:

The Partnership Agreement or equivalent funding commitment letter from the equity investors in the Development which demonstrates that Developer has sufficient funds and committed capital/equity for commencement through completion of construction, and that such funds have been committed to construction of the Development, and a current financial statement of Developer.

A complete copy of each application for Tax Credits and supporting documentation submitted to TCAC by Developer,within five (5) days following Developer's submission thereof to TCAC.

A copy of a preliminary reservation letter from TCAC notifying Developer that an allocation of 9% Tax Credits for not less than the Tax Credit Amount, has been reserved for construction of the Development, and further documentation demonstrating that Developer remains eligible and qualified to receive such allocation,along with certification that there have not been any material changes to the information provided by Developer in the applications for Tax Credits, as defined and referenced in such reservation letters, and that if there are material changes then such information will be provided to TCAC (and Commission) forthwith.

4.15.1.2. Approval of Financing_As required herein, Developer shall submit to Commission evidence that Developer has obtained sufficient equity capital or has arranged for and obtained a binding commitment for construction financing necessary to undertake the development of the Site and the construction of the Improvements in accordance with this Agreement("Proof of Financing Commitments").

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

Approval shall not be unreasonably withheld so long as the terms and conditions of the financing are consistent with this Agreement,including without limitation the availability of the Tax Credit Amount and the acknowledgment and consent by such lender to the Commission Regulatory Agreement as senior encumbrances, with the further proviso that if the Tax Credit Amount exceeds the amount set forth therefor on the Base Pro Forma, Developer shall agree that the excess remaining after applying amounts necessary to defray any cost overruns theretofore experienced or the Developer Fee (the "Excess Amount"), subject to the terms of the senior loan documents, shall be applied first to fund the Capital Replacement Reserve;financing terms shall be reasonable and customary. If Commission shall disapprove any such evidence of financing,Commission shall do so by Notice to Developer stating the reasons for such disapproval and Developer shall endeavor to promptly obtain and submit to Commission new evidence of financing. Commission shall approve or disapprove such new evidence of financing in the same manner and within the same times established in this Section 4.15(e) for the approval or disapproval of the evidence of financing as initially submitted to Commission. Developer shall close the approved Tax Credit financing prior to or concurrently with the Closing.

The Proof of Financing Commitment shall include a copy of a legally binding, firm and enforceable loan commitment(s)obtained by Developer from one or more financial institutions for the mortgage loan or loans for financing to fund the construction and completion of the Improvements. 34 414 N.Santa Fe,v5
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The parties intend that Developer is to obtain equity financing for the construction and operation of the Development including the use of Tax Credits (in an amount of not less than the Tax Credit Amount) and obtaining capital contributions from limited partners in the Development in consideration primarily for the receipt of the Tax Credits received by Developer with respect to the Development.

In no event shall Commission be obligated to provide any financial assistance or subsidy to the Development. City shall have no obligation to make any expenditures under this Agreement.

Developer understands and agrees that Developer and/or Parent(s) may be required by third party lenders to provide an operating deficit guaranty, tax credit recapture guaranty, and/or other guaranties which may be required with respect to the limited partners' investment in the Development.

If required for such financing, the execution of such guaranties shall be an additional condition precedent for the purposes of each of Sections 3.1 and 3.2.

4.15.1.3. Provisions Pertaining to the Disbursement of the Commission Loan. Commission will disburse to Developer the Commission Loan Amount as follows: (i) in an amount equal to the permit fees which shall have been paid by Developer to City in connection with the Project(within seven(7) days after City receives reasonably satisfactory evidence with respect to such payment), (ii) fifty percent(50%)of that portion of the Commission Loan Amount which remains undisbursed following the disbursement of the amounts described in clause (i), above within two (2)business days after the closing of the recording of a construction loan from a private third party), and, as to the remainder(iii) in installments based upon the percentage of completion of the Improvements as determined in good faith by the Executive Director upon review of evidence from Developer, the originator of the Primary Construction Loan, or other sources which evidence the percentage of completion.

Mortgages, deeds of trust and subleases and subleases-back on Developer fee interest in the Site shall be permitted before the completion of the Improvements only with Commission's prior written approval, but only for the purpose of securing loans of funds to be used for financing the construction of the Improvements (including architecture, engineering, legal, construction period carrying costs such as property taxes, insurance and interest,and related direct costs as well as indirect costs) on or in connection with the Site, and the obtaining of a permanent loan in the amount of the outstanding balance of the construction loan. In no event, however, shall the amount or amounts of indebtedness secured by mortgages or deeds of trust on Developer's fee interest in the Site exceed the projected Developer's cost, as evidenced by a pro forma and a construction contract which have been approved by the Executive Director in accordance with this Agreement and which set forth such costs, unless the written approval of the Executive Director is first obtained. Developer shall notify Commission in advance of any mortgage, deed of trust or sublease and sublease-back financing, if Developer proposes to enter into the same before completion of the construction of the Improvements.

The words "mortgage"and"trust deed"as used hereinafter shall include sublease and sublease-back.

The holder of any mortgage or deed of trust on Developer's fee interest in the Site authorized by this Agreement shall not be obligated by the provisions of this Agreement to construct, complete, or operate the Improvements or any portion thereof, or to guarantee such construction, completion or operation; nor shall any covenant or any other provision in this Agreement be construed so to obligate such holder. Nothing in this Agreement shall be deemed to permit or authorize any such holder to devote the Site to any uses or to construct any improvements thereon, other than those uses or improvements provided for or authorized by this Agreement. 35 414 N.Santa Fe,v5
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With respect to any mortgage or deed of trust granted by Developer as to its fee interest in the Site as provided herein, whenever Commission may deliver any notice or demand to Developer with respect to any breach or default by Developer under this Agreement, Commission shall at the same time deliver to each holder of record of any mortgage or deed of trust authorized by this Agreement a copy of such notice or demand;provided that the failure to notify any holder of record shall not vitiate or affect the effectiveness of notice to Developer. Each such holder shall(insofar as the rights granted by Commission are concerned) have the right, at its option, within sixty (60) days after the receipt of the notice,or such longer time as expressly provided for a cure under this Agreement,to cure or remedy or commence to cure or remedy and thereafter to pursue with due diligence the cure or remedy of any such default and to add the cost thereof to the mortgage debt and the lien of its mortgage or deed of trust. Nothing contained in this Agreement shall be deemed to permit or authorize such holder to undertake or continue the construction or completion of the Improvements, or any portion thereof (beyond the extent necessary to conserve or protect the improvements or construction already made) without first having expressly assumed Developer's obligations to Commission by written agreement reasonably satisfactory to Commission. The holder, in that event, must agree to complete, in the manner provided in this Agreement,the improvements to which the lien or title of such holder relates, but on a schedule which takes into account the time reasonably required for the holder to obtain title to and possession of the Site, analyze and negotiate amendments to plans, specifications, construction contracts and operating contracts or to negotiate new construction contracts and operating contracts.

Any such holder properly completing such improvement shall be entitled, upon compliance with the requirements of Section 4.13 of this Agreement,to a Certificate of Completion. It is understood that a holder shall be deemed to have satisfied the sixty (60) day time limit set forth above for commencing to cure or remedy a Developer default which requires title and/or possession of the Site (or portion thereof) if and to the extent any such holder has within such sixty (60) day period commenced proceedings to obtain title and/or possession and thereafter the holder diligently pursues such proceedings to completion and cures or remedies the default. The Executive Director is authorized to consent, on behalf of Commission, to the provision of similar cure rights to the limited partner as reasonably requested by the tax credit investor.

In any case where, sixty(60) days after the holder of any mortgage or deed of trust creating a lien or encumbrance upon the Site or any part thereof receives a notice from Commission of a default by Developer in completion of construction of any of the Improvements under this Agreement, and such holder is not vested with ownership of Developer's fee interest in the Site and has not exercised the option to construct as set forth in Section 4.15, or if it has exercised the option but has defaulted hereunder and failed to timely cure such default, in addition to such other rights and remedies as Commission shall have, Commission may purchase the mortgage or deed of trust by payment to the holder of the amount of the unpaid mortgage or deed of trust debt, including principal and interest and all other sums secured by the mortgage or deed of trust. If the ownership of the Site or any part thereof has vested in the holder,Commission,if it so desires, shall be entitled to a conveyance from the holder to Commission upon payment to the holder of an amount equal to the sum of the unpaid mortgage or deed of trust debt at the time title became vested in the holder (less all appropriate credits, including those resulting from collection and application of rentals and other income received during foreclosure proceedings);
All expenses with respect to foreclosure including reasonable attorneys' fees; The net expense,if any,incurred by the holder as a direct result of the subsequent management of the Site or part thereof,
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The costs of any improvements made by such holder;
An amount equivalent to the interest that would have accrued at the rate(s) specified in the holder's loan documents on the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust debt and such debt had continued in existence to the date of payment by Commission; and
Any customary prepayment charges imposed by the lender pursuant to its loan documents and agreed to by Developer.

In the event of a mortgage or deed of trust default or breach by Developer whether prior to or after the completion of the construction of any of the Improvements or any part thereof(continuing until the expiration of the Commission Regulatory Agreement), Developer shall immediately deliver to Commission a copy of any mortgage holder's notice of default. If the holder of any mortgage or deed of trust has not exercised its option to construct,Commission shall have the right but no obligation to cure the default. In such event, Commission shall be entitled to reimbursement from Developer of all proper costs and expenses incurred by Commission in curing such default.

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

The Commission Regulatory Agreement and the affordability covenants as contained therein will not be subordinated excepting only to affordability covenants(but not deeds of trust or instruments which secure payments or repayments) for the benefit of the County as beneficiary. The provision of durable affordable covenants is fundamental to the willingness of the Commission to enter into this Agreement.

COVENANTS AND RESTRICTIONS

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

5.2. Affordable Housing Requirements.

Developer agrees to make available, restrict occupancy to, and rent all of the Required Affordable Units at Affordable Rent. Subject to modification if mutually approved by the parties and further subject to the possible approval of greater affordability requirements by TCAC, there shall be fifty three(53)Required Affordable Units on the Site,one of which Units will be occupied by an onsite manager with affordability for those units to be provided in conformity with the Prescribed Income Levels and Affordable Rents. The restriction of Units in addition to the Required Affordable Units at limited rent levels, in connection with requirements for tax credits, shall not be deemed to constitute a violation of this Agreement.
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The Required Affordable Units shall be maintained as rental units available at and rented to 30% AMI Low Income Households and 40% AMI Extremely throughout the Required Covenant Period, as more particularly set forth in the Commission Regulatory Agreement.

All of the Required Affordable Units shall be restricted to occupancy by Senior Citizen Households. In addition, twenty seven (27) of the Units shall be restricted to Senior Citizen Households experiencing homelessness, with two (2) of such Units being further restricted to Senior Citizen Households consisting of Veterans experiencing homelessness.

Developer shall be responsible for the selection of tenants for the Required Affordable Units in compliance with the criteria set forth in Sections 5.2 and 5.3 of this Agreement. Developer shall restrict occupancy of all of the Required Affordable Units be occupied by Senior Citizen Households.

Developer shall be responsible for the selection of tenants for the Required Affordable Units in compliance with the criteria set forth in Section 5.3 of this Agreement. Developer shall be responsible to comply with all nondiscrimination provisions and fair housing provisions which are applicable as a matter of law.

Each tenant shall be a 30%AMI Extremely Low Income Household or a 40%AMI Very Low Income Household which, in accordance with the Prescribed Income Levels, meets the eligibility requirements established for the corresponding Required Affordable Unit, and Developer shall obtain a certification from each tenant renting or leasing each housing unit which substantiates such fact.

Developer shall verify the income certification of each tenant as set forth in Section 5.3 hereof. Prior to the rental or lease of any Unit on the Site to a tenant,and annually thereafter,Developer shall submit to Commission or its designee, at Developer's expense, a completed income computation and certification form, in a form to be provided by Commission.

Each Required Affordable Unit shall be rented at an "Affordable Rent" as defined in this Agreement.

5.3. Verifications.

Developer shall verify the income of each proposed and existing tenant of the Required Affordable Units and all other Units developed on the Site.

Following the issuance of the Certificate of Completion, and on or before June 15 of each Regulatory Agreement Year commencing which occurs after the recording of the Commission Regulatory Agreement, Developer, at its expense, shall submit to Commission or its designee the reports in the manner described by Health and Safety Code Section 33418, as the same may be amended from time to time,with each such report to be in the form prescribed by Commission. Each annual report shall cover the immediately preceding Regulatory Agreement Year. Developer shall submit to Commission the Monitoring Fee annually concurrently with the submittal of the reports referenced in this Section 5.3.2.

Developer shall maintain on file each tenant's executed lease and Income Verification and rental records for all Required Affordable Units developed on the Site. Developer shall maintain complete and accurate records pertaining to the Required Affordable Units and will permit any duly authorized representative of Commission to inspect the books and records of Developer pertaining to this Agreement and the Required Affordable Units upon reasonable advance notice of not less than twenty four (24) hours and during normal business hours. Developer shall prepare and submit to Commission (or its designee) annually commencing June 15 following the completion of the 38 414 N.Santa Fe,v5
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Improvements and continuing throughout the Required Covenant Period, a Certificate of Continuing Program Compliance. Such documentation shall state for each Required Affordable Unit the unit size, the rental amount,the number of occupants,and the income of the occupants and any other information which may be used to determine compliance with the terms of this Agreement.

As part of its annual report, Developer shall include a statement of amounts payable by Developer under this Agreement supported by an Audited Financial Statement (prepared by an independent accounting firm reasonably acceptable to Commission) which sets forth information in detail sufficient for adequate review by Commission for the purposes of confirming those amounts payable by Developer to Commission as well as showing the general financial performance of the Affordable Housing Project("Annual Financial Report"). Each Annual Financial Report shall include a profit and loss statement showing Gross Revenues, Operating Expenses, Debt Service, Capital Replacement Reserve and Rental Receipts,payments of fees and any other remuneration to Developer all certified by the Audited Financial Statement. Developer agrees to maintain records in businesslike manner, and to maintain such records for the Term of the Commission Regulatory Agreement. The income and rent restrictions provided for hereunder are intended and shall be maintained in a manner sufficient to satisfy the requirements of Health and Safety Code Section 33413(b) without regard to whether such statute is applicable as a matter of law.

In addition, as part of its annual report and at Commission's request, but not less frequently than prior to each initial and subsequent rental of each Unit to a new tenant household (but not lease renewals) and annually thereafter, Developer shall also provide to Commission completed income computation, asset evaluation, and certification forms, for any such tenant or tenants, in substantially the form provided by Commission from time to time. Developer shall obtain an annual certification from each household of each Unit demonstrating that such household is a 30% AMI Extremely Low Income Household or a 40%AMI Very Low Income Household,as applicable,and meets the eligibility requirements established for each such Unit. Developer shall verify the income certification of each tenant household. In order to comply with this Section 5.3.2, Developer shall submit to Commission any and all tenant income and occupancy certifications and supporting documentation required to be submitted to TCAC pursuant to the Tax Credit Rules and the Tax Credit Regulatory Agreement for the Development; provided, Commission may request (and Developer shall provide) additional documentation to assist Commission's evaluation of Developer's compliance with this Agreement, if determined to be necessary in the reasonable discretion of the Executive Director, specifically including(without limitation) any documentation or additional certifications that may be necessary to verify compliance with the requirements applicable to funding sources not without to Commission or City, as applicable, and each tenant's status as to each Required Affordable Unit. This requirement is in addition to and does not replace or supersede Developer's obligation to annually submit the Certificate of Continuing Program Compliance to Commission. Further, Commission has the right, but not the obligation to monitor compliance with respect to each tenant household at the Rental Project, and Commission's election to monitor some, but not all, of the Units shall not constitute a waiver of Commission's right to monitor and enforce compliance with respect to all Units in the future.

Throughout the Required Covenant Period, Developer shall deliver to the Executive Director a copy of each report it makes to TCAC, to tax credit investors (or their representatives), and to the county concerning the Development; such reports shall be delivered concurrently with the delivery of any such reports to TCAC,tax credit investors (or their representatives), or the County, respectively.

Gross income calculations for prospective (and continuing) tenants shall be determined in accordance with 25 Cal. Code Regs. Section 6914 or as required by the Tax Credit Rules. Developer 39 414 N.Santa Fe,v5
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shall verify the income and information provided in the income certification of the proposed tenant as set forth below.

Developer shall verify the income of each proposed tenant of the Rental Project and by at least one of the following methods as appropriate to the proposed tenant:
obtain two (2)paycheck stubs from the person's two (2)most recent pay periods; obtain a true copy of an income tax return from the person for the most recent tax year in which a return was filed;
obtain an income verification certification from the employer of the person; obtain an income verification certification from the Social Security Administration and/or the California Department of Social Services if the person receives assistance from such agencies; obtain an alternate form of income verification reasonably requested by Commission, if none of the above forms of verification is available to Developer; or as to the Required Affordable Units obtain verification and supporting documentation of the household as a Senior Citizen Household;
As to the Units restricted to Senior Citizen Households experiencing homelessness, evidence verifying such households are experiencing homelessness; As to the Units restricted to Senior Citizen Households that are Veterans, evidence verifying that such households consist of Veterans that are experiencing homelessness.

Developer shall retain documentation regarding the eligibility of each new tenant household.

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

Developer and its maintenance staff, contractors or subcontractors shall comply with the following standards as to the Development(collectively, "Maintenance Standards"):
(a) The Site shall be maintained in conformance and in compliance with the approved final as-built plans, and reasonable maintenance standards which comply with the industry standard for comparable first quality affordable housing projects in San Diego County, including but not limited to painting and cleaning of all exterior surfaces and other exterior facades comprising all private improvements and public improvements to the curbline. The Site shall be maintained in good condition taking into account ordinary wear and tear and in accordance with the industry custom and practice generally applicable to comparable first quality affordable housing projects in San Diego County. (b) Landscape maintenance shall include, but not be limited to: watering/irrigation; fertilization;mowing;edging;trimming of grass;tree and shrub pruning;trimming and shaping of trees and shrubs to maintain a healthy, natural appearance and safe road conditions and visibility, and 40 414 N.Santa Fe,v5
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irrigation coverage; replacement, as needed, of all plant materials; control of weeds in all planters, shrubs, lawns, ground covers, or other planted areas; and staking for support of trees. (c) Clean-up maintenance shall include, but not be limited to: maintenance of all sidewalks,paths and other paved areas in clean and weed-free condition;maintenance of all such areas clear of dirt, mud, trash, debris or other matter which is unsafe or unsightly; removal of all trash, litter and other debris from improvements and landscaping prior to mowing; clearance and cleaning of all areas maintained prior to the end of the day on which the maintenance operations are performed to ensure that all cuttings, weeds, leaves and other debris are properly disposed of by maintenance workers.

If Commission notifies Developer in writing if the condition of the Site which do not meet with the Maintenance Standards, Commission will specify the deficiencies and the actions required to be taken by Developer to cure the deficiencies. Upon notification of any maintenance deficiency, Developer shall have thirty (30) days within which to correct, remedy or cure the deficiency. If the deficiencies require more than thirty (30) days to cure and Developer diligently commences to cure within the thirty (30) day period, then Developer shall have an additional sixty (60) days to cure. If the written notification states the problem is urgent relating to the public health and safety, then Developer shall have forty-eight (48) hours to rectify the problem. In the event Developer does not maintain the Site in the manner set forth herein and in accordance with the Maintenance Standards, Commission shall have, in addition to any other rights and remedies hereunder, the right to maintain the Site, or to contract for the correction of such deficiencies, after written notice to Developer, and Developer shall be responsible for the payment of all such costs incurred by Commission.

In addition to the routine maintenance and repair required pursuant to Section 5.4 Developer shall perform the following minimum programmed maintenance of the Improvements to the Site for so long as the Commission Regulatory Agreement remain in effect:

Interior painting and window covering replacement at least every seven(7)Years,unless such improvements would be substantially disruptive to a vulnerable resident occupant, in which case, Developer shall perform as work at the earliest feasible opportunity; Exterior painting at least every ten (10) Years, unless the exterior is of a material which the manufacturer recommends to not be painted;
Repair and resurfacing of parking areas and walkways at least every ten(10)Years; Replacement of all deteriorated or worn landscaping at least every five (5)Years; and Replacement of all deteriorated or worn recreational equipment at least every ten(10)Years.

Notwithstanding the foregoing, if the Executive Director reasonably determines that the Development suffers from excess unexpected wear and tear requiring any of the above items of maintenance to be performed sooner than as set forth above, Commission may require that such maintenance actions be performed within a reasonable time, even if sooner than the time periods set forth above. Upon the request of Developer, the Executive Director, at his or her sole and absolute discretion, may grant a waiver or deferral of any program maintenance requirement. Developer shall keep such records of maintenance and repair as are necessary to prove performance of the program maintenance requirements.
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To the greatest extent allowed by law, the maximum occupancy of the Units in the Development shall not exceed more than such number of persons as is equal to two persons per bedroom,plus one. Thus,for a studio Unit,the maximum occupancy shall not exceed two(2)persons; for a one(1)bedroom Unit,the maximum occupancy shall not exceed three (3)persons; and for a two (2)bedroom Unit,the maximum occupancy shall not exceed five (5)persons.

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

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

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

5.6. Effect of Violation of the Terms and Provisions of this Agreement After Completion of Construction. Commission is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided, without regard to whether Commission has been, remains or is an owner of any land or interest therein in the Site or in the Project Area of the Redevelopment Plan. Commission shall have the right, if the Agreement or any covenants in any agreement pursuant to this Agreement, including without limitation the Commission Regulatory Agreement are breached,to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and such covenants may be entitled.

DEVELOPER'S GENERAL REPRESENTATIONS AND WARRANTIES.

As a material inducement to each of City and Commission to enter into this Agreement, Developer represents and warrants to each of City and Commission that:

6.1. Formation, Oualification and Compliance. Developer (a)is a California limited partnership validly existing and in good standing under the laws of the State of California; (b)has all requisite and the authority to conduct its business and own, purchase, improve and sell its properties. Developer is in compliance in all material respects with all laws applicable to its business and has obtained all approvals, licenses, exemptions and other authorizations from,and has accomplished all filings,registrations and qualifications with any governmental agency that are necessary for the transaction of its business; (c)Developer has and will in the future duly authorize,execute and deliver this Agreement and any and all other agreements and documents required to be executed and delivered by Developer in order to carry out, give effect to, and consummate the transactions contemplated by this Agreement; (d)Developer does not have any material contingent obligations or any material contractual agreements which could materially adversely affect the ability of Developer to carry out its obligations hereunder; (e) There are no material pending or, so far as is known to Developer, threatened, legal proceedings to which Developer is or may be made a party or to which any of its property is or may become subject, which have not been fully disclosed by Developer to Commission and City in this Agreement which could materially adversely affect the ability of Developer to carry out its obligations hereunder; and(f) There is no action or proceeding pending or,to Developer's best knowledge, threatened, looking toward the dissolution or liquidation of Developer and there is no action or proceeding pending or,to Developer's best knowledge, 43 414 N.Santa Fe,v5
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threatened by or against Developer which could affect the validity and enforceability of the terms of this Agreement, or materially and adversely affect the ability of Developer to carry out its obligations hereunder.

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

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

6.3. Covenant Not to Transfer Except in Conformity. Excepting for the rental of individual dwelling units to occupants in the regular course of business (which rental activity shall not be limited by this Section 6.3),or the sale of a partnership interest to generate proceeds in consideration of the Tax Credits, or the transfer of limited partnership interests and/or the Improvements to Developer's general partners or the members thereof following the expiration of the tax credit compliance period,Developer shall not sell,lease,or otherwise transfer or convey all or any part of the Site, or any interest therein,unless Developer has first obtained the prior written consent of the Executive Director, which consent may be granted or refused in the Executive Director's sole and absolute discretion. In addition, Developer's limited partner and any successor thereto, may, without the prior consent of Commission and except as set forth in the senior permitted liens, sell, transfer, assign, pledge, hypothecate, and encumber some or all of its partnership interests in Developer and the same shall not be a violation of this Agreement. Moreover, Developer's limited partner and any successor thereto, shall have the right, without the prior consent of Commission and except as set for in the senior permitted liens, to remove any or all of Developer's general partners for cause as permitted under Developer's limited partnership agreement and replace any or all removed general partners with a person or entity determined in the limited partner's sole discretion. Any sale,lease,transfer or conveyance without such consent shall, at Commission's option, be void. Excepting to the extent otherwise expressly permitt4ed herein, a change in ownership of Developer resulting in the persons executing this Agreement on behalf of Developer retaining less than fifty-one percent(51%)ownership of all outstanding shares of Developer shall be deemed to violate this Section 6.3. In connection with the foregoing consent requirement, Developer acknowledges that Commission relied upon Developer's particular expertise in entering into this Agreement and continues to rely on such expertise to ensure the satisfactory completion of all of the Improvements, and the marketing and rental of the Required Affordable Units to 30% AMI Extremely Low Income Households and 40% AMI Very Low Income Households to afford the community a long-term,quality affordable housing resource.
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DEFAULTS,REMEDIES,AND TERMINATION.

7.1. Default Remedies. Subject to the extensions of time set forth in Section 7.12 of this Agreement, failure by any party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and failure to cure as described hereafter, constitutes a "Default" or"Event of Default" under this Agreement.

A party claiming a Default shall give written notice of Default to the other parties specifying the Default. Except as otherwise expressly provided in this Agreement, and without limiting or affecting rights of parties hereto to terminate this Agreement, the claimant shall not institute any proceedings against any other party, and the other parties shall not be in Default if such parry within thirty (30) days from receipt of such notice immediately, with due diligence, commences to cure, correct or remedy the specified Default and shall complete such cure, correction or remedy with diligence.

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

7.3. Termination by Developer. In the event that as of the time described below (and if no time is described below, the time established therefor in the Schedule of Performance):
by the time set forth therefor in the Schedule of Performance for the recording of the Commission Regulatory Agreement, Developer is not in default under this Agreement and Commission does not execute and attempt to effect the recording of the Commission Regulatory Agreement to Developer in the manner and condition and by the date provided in this Agreement; or If Commission has delivered to Developer an Adverse Commission Site Determination and Developer does not elect to perform remedial action,Developer shall have the right,within ninety(90) days after receipt of such Adverse Commission Site Determination,to terminate this Agreement; in the event of any Default of Commission prior to the recording of the Commission Regulatory Agreement which is not cured within the time set forth in Section 7.1 hereof; and any such failure is not cured within the applicable time period after written demand by Developer (or, with respect to (c), above, by the time set forth therein), then this Agreement may, at the option of Developer, be terminated by Notice thereof to Commission; provided that Developer shall have delivered to Commission the documents required to be delivered to Commission pursuant to Section 4.15 of this Agreement. From the date of the Notice of termination of this Agreement by Developer to Commission and thereafter, this Agreement shall be deemed terminated and there shall be no further rights or obligations among the parties.

7.4. Termination by Commission. In the event that Developer fails to obtain one or more of a preliminary reservation of Tax Credits by TCAC by the Tax Credit Deadline, or to provide by the Tax Credit Deadline evidence satisfactory to the Executive Director that 45 414 N.Santa Fe,v5
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tax credit proceeds will be available for the Development,or if prior to the time established in the Schedule of Performance for the satisfaction of the Commission's Conditions Precedent:

One or more of the Milestones is not satisfied by the time established therefor as to the applicable Tax Credit Deadline; or
Developer(or any successor in interest) assigns this Agreement or any rights therein or in the Site in violation of this Agreement; or
Commission receives notification from Developer that there are Materially Adverse Conditions at the Site or that the condition of the Site will delay or preclude completion of the Improvements; or One of more of the Commission Conditions Precedent is not satisfied; or Developer fails to execute Developer is otherwise in default of this Agreement and fails to cure such default within the time set forth in Section 7.1 hereof, then this Agreement and any rights of Developer or any assignee or transferee with respect to or arising out of the Agreement or the Site (including without limitation all attachments to this Agreement), shall, at the option of Commission, be terminated by Commission by Notice thereof to Developer.From the date of the Notice of termination of this Agreement by Commission to Developer and thereafter this Agreement (including without limitations all attachments hereto) shall be deemed terminated and there shall be no further rights or obligations among the parties,except that Commission may pursue any remedies it has hereunder.

7.5. Acceptance of Service of Process. In the event that any legal action is commenced against City, service of process on City shall be made by personal service upon the Executive Director or in such other manner as may be provided by law. In the event that any legal action is commenced against Commission, service of process on Commission shall be made by personal service upon the Executive Director or in such other manner as may be provided by law. In the event that any legal action is commenced against Developer, service of process on Developer shall be made in such manner as may be provided by law and shall be effective whether served inside or outside of California.

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

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

7.8. Applicable Law. The laws of the State of California shall govern the interpretation and enforcement of this Agreement.
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7.9. Covenant Provisions; Certain Amendments. In the event, as a result of the provision of other financing in connection with the Development, the parties will review and, if appropriate amend covenant and reporting provisions hereof to encompass such other Units as may be regulated by virtue of such other funding. In the event Developer is required by virtue of such other financing to restrict the affordability of Units in a manner more restrictive than as set forth under the form of Commission Regulatory Agreement then, from time to time upon receipt of request therefor from the Executive Director, Developer agrees to consent to modifications to incorporate such greater restrictions into the Commission Regulatory Agreement; such request(s)by the Executive Director can be made at any time(s) during the Required Covenant Period without regard to whether the Commission Regulatory Agreement have been recorded.

7.10. Enforced Delay; Extension of Times of Performance. In addition to specific provisions of this Agreement,performance by any party hereunder shall not be deemed to be in Default, and all performance and other dates specified in this Agreement shall be extended, where delays or Defaults are due to: war; insurrection; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy; acts or omissions of another party, or acts or failures to act of City or any other public or governmental agency or entity (excepting that acts or failures to act of Commission or City shall not excuse performance by Commission or City). Notwithstanding anything to the contrary in this Agreement, an extension of time for any such cause shall be for the period of the enforced delay and shall commence to run from the time of the commencement of the cause, if notice by the party claiming such extension is sent to the other party within thirty (30) days of the commencement of the cause. Times of performance under this Agreement may also be extended in writing by the mutual agreement of Commission and Developer.

The failure to obtain an allocation or reservation of tax credits or financing commitments adequate to finance the Development shall not constitute grounds of enforced delay pursuant to this Section 7.10.

In addition to the foregoing(and without regard to the preceding portion of this Section 7.10), the Executive Director shall have the authority, at his discretion, to approve extensions on behalf of Commission to approve extensions of time not to exceed a cumulative total of three hundred sixty-five (365) days.

7.11. Transfers of Interest in Agreement or of Site. Except as otherwise set forth in Section 6.3 hereof, Section 7.12,and all subsections of this Section 7.12, shall apply to all transfers.

The qualifications and identity of Developer are of particular concern to Commission. It is because of those qualifications and identity that Commission has entered into this Agreement with Developer. For the period commencing upon the date of this Agreement and until the end of the Required Covenant Period, except as otherwise set forth in Section 6.3 hereof, no voluntary or involuntary successor in interest of Developer shall acquire any rights or powers under this Agreement, nor shall Developer make any total or partial sale, transfer, conveyance, assignment, subdivision, refinancing or lease of the whole or any part of the Site or the Development thereon (excepting the rental of Units to Occupants) without prior written approval of Commission, except as expressly set forth herein.
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In the event of a proposed assignment by Developer under subparagraphs 7.11.2 through

7.11.3, inclusive, Developer agrees that at least thirty (30) days prior to such assignment it shall give written notice to Commission including a request for approval of such assignment and satisfactory evidence that the assignee has assumed jointly with Developer the Obligations of this Agreement. In addition, no consent of Commission shall be required in connection with the transfer of Developer's interest in the Site that occurs by foreclosure or deed in lieu of foreclosure of any Permitted Senior Lien to respective holder thereof or to their nominees or assignees exclusive of Developer and Parent(s). The provisions of this Section 7.11.2 shall be limited by those transfers permitted in Section

6.3. Section 6.3 shall be enforceable in accordance with its terms.

The conveyance or dedication of any portion of the Site to City or other appropriate governmental agency, or the granting of easements or permits to facilitate construction of the Development.

In the event of a proposed assignment by Developer under subparagraphs 7.11.2 through

Commission agrees that it will consider in good faith,but in its sole and absolute discretion, a request made pursuant to this Section 7.11 after the achievement of occupancy of ninety percent(90%) or more of the Units in conformity with this Agreement following the issuance by Commission of a Certificate of Completion for the last building to be constructed as part of the Improvements,provided Developer delivers written notice to Commission requesting such approval, the Commission Regulatory Agreement remain in full force and effect. Such notice shall be accompanied by sufficient evidence regarding the proposed assignee's or purchaser's development and/or operational qualifications and experience,its financial commitments and resources,and the financial terms of such assignment (including the consideration proposed to flow to Developer or Related Entity and/or any of the Principals) in sufficient detail to enable Commission to evaluate the proposed assignee or purchaser pursuant to the criteria set forth in this Section 7.11, and as reasonably determined by Commission. Notwithstanding the foregoing,the transfer of limited partnership interests to tax credit investors shall not require Commission consent nor entitle Commission to receive compensation (in connection with such transfer to tax credit investors); neither shall a transfer which is expressly required by this Agreement to be approved by Commission. As to transfers where approval of Commission is not expressly required under this Agreement but where transfer is nevertheless approved by Commission, Commission shall be entitled to receive compensation. As to transfers where Commission approval is required, Commission shall evaluate each proposed transferee or assignee on the basis of its development and/or qualifications and experience in the operation of facilities similar to the Development,and its financial commitments and resources,and may reasonably disapprove any proposed transferee or assignee, during the period for which this Section 7.11 applies, which Commission reasonably determines does not possess sufficient qualifications. An assignment and assumption agreement in form satisfactory to Commission's legal counsel shall also be required for all proposed assignments. Within thirty (30) days after the receipt of Developer's written notice 48 414 N.Santa Fe,v5
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requesting approval of an assignment or transfer pursuant to this Section 7.11, including assignments that do not require Commission/Commission Executive Director approval, Commission shall either approve or disapprove such proposed assignment or shall respond in writing by stating what further information, if any, Commission reasonably requires in order to determine the request complete and determine whether or not to grant the requested approval. Upon receipt of such a response,Developer shall promptly furnish to Commission such further information as may be reasonably requested. In addition, Commission approval shall not be required for a transfer made at the conclusion of the tax credit period to Developer and affiliates upon the withdrawal of the tax credit investor (which shall include either a transfer of the Improvements and/or the limited partnership interests in Developer to the general partners and/or members thereof), so long as there are no defaults under this Agreement and the transferee agrees to be bound by all executory provisions of this Agreement.

All of the terms,covenants and conditions of this Agreement shall be binding upon Developer and its permitted successors and assigns. Whenever the term"Developer" is used in this Agreement, such term shall include any other permitted successors and assigns as herein provided.

Commission may assign or transfer any of its rights or obligations under this Agreement with the approval of Developer, which approval shall not be unreasonably withheld; provided, however, that Commission may assign or transfer any of its interests hereunder to City at any time without the consent of Developer.

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

7.13. Relationship Among Commission,City and Developer. It is hereby acknowledged that the relationship among Commission, City and Developer is not that of a partnership or joint venture and that Commission, City and Developer shall not be deemed or construed for any purpose to be the agent of the other. Accordingly, except as expressly provided in this Agreement, including the Attachments hereto, neither Commission nor City shall have no rights, powers, duties or obligations with respect to the development, operation, maintenance or management of the Development.

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

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

7.16. Non-recourse Liability of Developer. Notwithstanding anything to the contrary in this Agreement or any other Project Document, neither Developer nor any of its partners 49 414 N.Santa Fe,v5
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shall be personally liable for any default, loss, claim, damage, expense or liability to any person and the sole remedy against Developer hereunder shall be limited to its interest in the Development, excepting that Developer will be responsible for those liabilities of Developer referenced in Sections 4.7.

MISCELLANEOUS

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

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

If to Developer: Santa Fe Senior Village, LP
c/o National Community Renaissance of California
9421 Haven Avenue
Rancho Cucamonga, CA 91730
Attn: Michael Ruane
Telephone: (760) 941-6545
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with a copy to: San Diego Community Housing Corporation 4725 Mercury Street, Suite 202
San Diego, CA 92111
Attn.: Ted Miyahara
Telephone: (619) 876-4222
and a copy to: Gubb &Barshay LLP
235 Montgomery Street, Suite 1110
San Francisco, CA 94101
Attn.: Lauren B. Fechter
(which copy shall not constitute notice to Developer)
and a copy to: [tax credit syndicator: to be designated by Developer] (which copy shall not constitute notice to Developer)
If to Commission: Community Development Commission of the City of Vista 200 Civic Center Drive
Vista, CA 92084
Attn: Executive Director
If to City: City of Vista
200 Civic Center Drive
Vista, California 92084
Attention: City Manager
and a copy to: (which copy shall not constitute notice to Commission or City)
Office of City Attorney
200 Civic Center Drive
Vista, CA 92084
Attention: City Attorney
Addresses for notice may be changed from time to time by written notice to all other parties.

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

8.3. Survival of Representations and Warranties. All representations and warranties in the Project Documents shall survive the recording of the Commission Regulatory Agreement and the rental of the Required Affordable Units and have been or will be relied on by Commission notwithstanding any investigation made by Commission.

8.4. No Third Parties Benefited Except for City; AB 987. This Agreement is made for the purpose of setting forth rights and obligations of Developer and Commission,and no other person (except for City) shall have any rights hereunder or by reason hereof. Except for City, which shall be deemed to be a third parry beneficiary of this Agreement (including 51 414 N.Santa Fe,v5
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without limitation the Attachments hereto), there shall be no third party beneficiaries of this Agreement. Developer acknowledges that, notwithstanding the foregoing portion of this Section 8.4, pursuant to AB 987 and the amendments to Health and Safety Code Section 33334.3 made effective as of January 1, 2008 by that bill, it is possible that violations of the covenants, conditions and restrictions relating to affordable housing contained in the Commission Regulatory Agreement may now be enforceable not only by Commission and City, but also by each of the persons and/or entities listed in Section 33334.3(f)(7) of the Health and Safety Code, specifically (1)residents of affordable units subject to covenants recorded pursuant to Health and Safety Code Section 33334.3(f)(1) (each, a "Covenanted Unit"), (2)the most recent former residents of such a Covenanted Unit, (3) applicants that are 30% AMI Extremely Low Income Households or 40% AMI Very Low Income Households that are denied occupancy of such a Covenanted Unit, and (4)persons that are 30% AMI Extremely Low Income Households or 40% AMI Very Income Households and who are on a waiting list for occupancy of such a Covenanted Unit. The provisions of AB 987 are to be applicable only to the extent required by law. Nothing in this Section 8.4 or this Agreement (including the Attachments hereto) is intended to provide an enforcement right to any person or entity not specifically made an intended third party beneficiary of this Agreement; any such third party shall be limited in their right to enforce affordability restrictions to the extent provided by Health and Safety Code Section 33334.3(f). Neither Commission nor City make any representation concerning the applicability, vel non, of Section 33334.3 as described in the foregoing portion of this Section 8.4.

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

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

8.7. Prior Agreements; Amendments; Consents. This Agreement(together with the other Project Documents) contains the entire agreement among City, Commission and Developer with respect to the Site, and all prior negotiations, understandings and agreements with respect to such matters are superseded by this Agreement and such other Project Documents. No modification of any Project Document (including waivers of rights and conditions)shall be effective unless in writing and signed by the party or parties against whom enforcement of such modification is sought, and then only in the specific instance and for the specific purpose given. This Agreement is executed in three (3) 52 414 N.Santa Fe,v5
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duplicate originals, each of which is deemed to be an original. This Agreement includes pages 1 through 53,plus signature pages,and Attachments 1 through 12,which constitutes the entire understanding and agreement of the parties.

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

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

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

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

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

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

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

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

8.14. Warranty Against Payment of Consideration. Developer warrants that it has not paid or given, and will not pay or give, any third person any money or other consideration for obtaining this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the dates hereinafter respectively set forth.

DEVELOPER:

SANTA FE SENIOR VILLAGE,LP,
a California limited partnership
By: NCRC Santa Fe SV LLC
a California limited liability company
Its: Managing General Partner
By: National Community Renaissance of
California
a California nonprofit public benefit
corporation,
Its: Manager
By:

Michael Ruane
Its: Executive Vice President
By: SDCHC Santa Fe Senior LLC
a California limited liability company, its
administrative general partner
By: San Diego Community Housing
Corporation, a California nonprofit public
benefit corporation, its manager and sole
member
By:

Theodore T. Miyahara
Its: President& Chief Executive Officer
S-1
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CITY: COMMISSION:

CITY OF VISTA, a charter city duly COMMUNITY DEVELOPMENT organized and existing under and by virtue of COMMISSION OF THE CITY OF VISTA, a the Constitution and the laws of the State of public body, corporate and politic California
By: By:

JOHN FRANKLIN,Mayor JOHN FRANKLIN, Chairperson
ATTEST: ATTEST:

Kathy Valdez, City Clerk Kathy Valdez, Commission Secretary APPROVED AS TO FORM: APPROVED AS TO FORM:

Walter C. Chung, City Attorney Walter C. Chung, Commission Counsel S-2
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ATTACHMENT NO. 1

MAP OF THE SITE
[to come]
Attachment No. 1

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ATTACHMENT NO. 2

LEGAL DESCRIPTION OF THE SITE
[to come]
Attachment No. 2

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ATTACHMENT NO. 3

SCHEDULE OF PERFORMANCE
For the purposes of this Schedule of Performance, the "Date of Agreement" is January 23, 2023. The Executive Director may extend by not more than three hundred sixty-five (365) days the time under this Schedule of Performance by which any obligation of Developer shall be performed.

1. TCAC Approval. Developer shall have Not later than the applicable Tax Credit Deadline. obtained allocation by TCAC of a
preliminary reservation for tax credits for
the Development.

2. Satisfaction of Commission Conditions Not later than the one hundred twentieth (120th) Precedent. Developer shall satisfy the day following the applicable Tax Credit Deadline.

Commission Conditions Precedent.

3. Recording of Documents. Each and every Within one hundred eighty (180) days after the document required to be executed and earlier to occur of. (i) the satisfaction of the delivered in connection with the recording Commission Conditions Precedent,or(ii)the time of the Commission Regulatory Agreement established under this Schedule of Performance shall have been delivered and each and for the satisfaction of the Commission Conditions every document required to be recorded Precedent.
shall have been recorded, including
without limitation the Commission
Regulatory Agreement).

4. Commencement of Construction. No later than two hundred twenty (220) days Developer shall have commenced following the applicable Tax Credit Deadline. construction of the Improvements.

5. Completion of Construction. Developer Within twenty (20) months after the earlier of shall complete construction of the (i) commencement of construction or(ii)the time Improvements. set forth in item #4 for the commencement of construction of the Improvements.

Attachment No. 3

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6. Rental Units Occupied. Developer causes Within one hundred twenty (120) days after the the Required Affordable Units to be earlier of(i) completion of construction or(ii)the occupied using rents prescribed by and in time established for completion of construction in conformity with the Agreement or held this Schedule of Performance. available for such occupancy.

Attachment No. 3

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4847-5658-4103v7/200471-0011
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ATTACHMENT NO. 4

CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
TO: Community Development Commission of the City of Vista 200 Civic Center Drive
Vista, California 92084
Attention: Executive Director
The undersigned, , being duly authorized to execute this Certificate of Continuing Program Compliance (this "Certificate") on behalf of Santa Fe Senior Village, LP, a California limited partnership (the "Developer"), hereby represents and warrants that:

1. He has read and is thoroughly familiar with the provisions of that certain unrecorded Affordable Housing Agreement(the"AHA")by and among Commission,the City of Vista(the"City") and Developer dated as of January 23,2023, including without limitation the Commission Regulatory Agreement, and other attachments thereto. Capitalized terms used herein shall have the same meaning as that set forth in the AHA; and

2. As of the date of this Certificate, the following number of completed residential units at the Site: (i) are currently occupied by 30%AMI Extremely Low Income Households at Affordable Rent; (ii) are currently occupied by a 40% AMI Very Low Income Households at Affordable Rent; (iii) are currently vacant and being held available for occupancy by a 30%AMI Extremely Low Income Households at Affordable Rent; (iv) are currently vacant and being held available for occupancy by a 40% AMI Very Low Income Households at Affordable Rent; (v) are currently vacant and being held available for occupancy by a 30% AMI Extremely Low Income Household and have been so held continuously since the date a 30%AMI Extremely Low Income Households vacated such Unit; or(vi) are currently vacant and being held available for occupancy by a 40% AMI Very Low Income Household and have been so held continuously since the date a 40% AMI Very Low Income Households vacated such Unit:

Occupied at an Affordable Rent by:
i. 30%AMI Extremely Low Income Households (30%) #of Units,Nos.:
ii. 40%AMI Very Low Income Households (40%),#of Units,Nos.:

Vacant:
a. Held for occupancy by:
i. 30%AMI Extremely Low Income Households (30%) _#of Units,Nos:

Attachment No. 4

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ii. 40%AMI Very Low Income Households (50%),#of Units,Nos.:
b. Last occupied by:
i. 30%AMI Extremely Low Income Households (30%)_#of Units,Nos:
ii. 40%AMI Very Low Income Households (40%)!#of Units,Nos.:

Further delineate which Units have been occupied by or held vacant for occupancy by Senior Citizen Households experiencing homelessness; in addition, indicate which Units have been occupied by or held vacant for occupancy by Senior Citizen Households that consist of Veterans experiencing homelessness.

3. At no time since the date of filing of the last Certification of Continuing Program Compliance have less than one hundred percent(100%)of the Required Affordable Units as completed units in the Development been occupied by, or been last occupied, or have been available for occupancy by 30% AMI Extremely Low Income Households or 40% AMI Very Low Income Households at an Affordable Rent, not fewer than fifty three (53) of the Required Affordable Units have been occupied with households. All of the Required Affordable Units have been occupied only by Senior Citizen Households or have been held for occupancy by Senior Citizen Households.

Attachment No. 4

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

Michael Ruane
Its: Executive Vice President
By: SDCHC Santa Fe Senior LLC
a California limited liability company
Its: Administrative General Partner
By: San Diego Community Housing
Corporation
a California nonprofit public benefit
corporation,
Its: Manager
By:

Theodore T. Miyahara
Its: President& Chief Executive Officer
(DEVELOPER)
Attachment No. 4

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ATTACHMENT NO. 5

NOTICE OF AFFORDABILITY RESTRICTIONS
[to come]
Attachment No. 5

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ATTACHMENT NO. 6

COMMISSION NOTE
202_("Date of Promissory Note") $500,000.00
Vista, California
FOR VALUE RECEIVED,the undersigned SANTA FE SENIOR VILLAGE,LP,a California limited partnership, ("Maker" or "Developer"), having its principal place of business at 9421 Haven Avenue, Rancho Cucamonga, California 91730, promises to pay to the order of the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA, a public body, corporate and politic ("Payee"or"Commission"), at 200 Civic Center Drive,Vista,California 92084,or at such other place as the holder of this Note from time to time may designate in writing,the principal sum of Five Hundred Thousand Dollars ($500,000.00) (the "Original Principal Amount"), as well as additional amounts described in Section 1 below,together with interest on the unpaid principal amount of this Promissory Note ("Promissory Note") from time to time outstanding at the "Applicable Interest Rate," as defined in that certain unrecorded Affordable Housing Agreement dated as of January 23,2023 by and among Commission, the City of Vista, a charter city duly organized and existing under and by virtue of the Constitution and the laws of the State of California ("City"), and Developer (the "AHA") in lawful money of the United States of America. This Promissory Note is being delivered pursuant to the AHA.

Any capitalized terms not defined herein shall have the respective meanings set forth therefor in the AHA. The loan evidenced by this Promissory Note shall be governed by such provisions of the AHA (including without limitation the attachments thereto) as shall be applicable. Interest shall accrue on the Original Principal Amount at the Applicable Interest Rate commencing as of the Date of Promissory Note. All capitalized terms used herein shall have the meanings set forth therefor in the AHA. Interest shall accrue only on the Commission Loan Amount and such additional amounts as may become payable under Section 1 of this Promissory Note. This Promissory Note shall be nonrecourse.

1. Additional Amounts. The principal due under this Promissory Note shall be increased by: (a) any "Reporting Amounts" (as defined in Article II, Section 3 of the Commission Regulatory Agreement; (b) an amount equal to one hundred fifteen percent (115%) of the amounts paid by Commission for insurance premiums or costs to repair and maintain the Development upon the failure by Developer to timely and fully provide insurance at the times and for the amounts provided therefor in the AHA; and (c) in the event an Audited Financial Statement shows an underpayment to Commission of five percent(5%) or greater of the amount paid to Commission for the corresponding Year, Developer shall pay to Commission the Commission's reasonable costs (including accountant and consultant fees, attorneys' fees, and a reasonable estimation of the cost of staff time) incurred in connection with Commission's audit of Developer.

2. Payments.

8.14.1.1. Payments of Additional Amounts due pursuant to Section 1 hereof shall be due and payable as of the last day of the Regulatory Agreement Year during which an obligation therefor first arises;
Attachment No. 6

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8.14.1.2. Excepting to the extent earlier times apply to the payment of Additional Amounts pursuant to paragraph(a) of this Section 2,payments under this Promissory Note shall be due and payable as follows: payments of the pro rata portion of Commission of the Public Agency Share of Residual Receipts payable on the first anniversary of the Date of the Promissory Note, and each anniversary thereafter until this Promissory Note has been satisfied in full. In addition, the entire amount of the Commission Loan together with accrued interest and any additional amounts which become owing hereunder shall be paid by maker to Payee as of the fifty-eighth(58th) anniversary of the Date of the Promissory Note (which fifty-eighth anniversary date constitutes the"Maturity Date").

8.14.1.3. Payments to Commission may, at the option of Payee,be accelerated and shall be due and payable hereunder in the event of the occurrence of any default under the AHA, the Commission Deed of Trust, this Promissory Note, or the Commission Regulatory Agreement, which default continues past such notice or cure period as may be applicable under the AHA.

Notwithstanding anything to the contrary contained herein, to the extent not sooner paid hereunder, payment of all amounts accrued as of the Maturity Date shall be due and payable as of the Maturity Date.

3. Other Loan Documents;Limitation Upon Refinancing. Repayment of this Promissory Note is secured by a deed of trust (the "Commission Deed of Trust") of this date executed by Maker for the benefit of Payee encumbering the property described in the Deed of Trust (the "Property" or "Site").

Developer may not process a cash out refinancing during the Term of the Commission Regulatory Agreement which would, in the good faith judgment of Payee, adversely affect payments (including without limitation the amount thereof) to Payee during the Term of the Commission Regulatory Agreement; any such refinancing with the express prior written consent of the Payee constitutes a breach hereunder.

4. Prepayment. Maker shall have the right to prepay amounts owing under this Promissory Note at any time.

5. Due on Sale or Encumbrance. In the event of any Transfer(as defined below) of the Property, or any portion thereof or interest therein, Payee shall have the absolute right at its option, without prior demand or notice, to declare all sums secured hereby immediately due and payable. As used herein, the term "Transfer" means and includes the direct or indirect sale, transfer, conveyance, mortgage, further encumbrance, assignment, or other alienation of the Property, or any portion thereof or interest therein, whether voluntary, involuntary, by operation of law or otherwise, the execution of any installment land sale contract, sales agreement or similar instrument affecting all or a portion of the Property, granting of an option to purchase any portion of or interest in the Property or any interest therein, or the lease of all or substantially all of the Property or of all or substantially all of the improvements located thereon. Transfer shall not include the sale, transfer, assignment, pledge, hypothecation or encumbrance by Developer's limited partner of its partnership interest to the extent Attachment No. 6

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permitted by the AHA nor shall Transfer include the removal of any general partner of Developer by the limited partner for cause and the replacement of such removed general partner by another person or entity in accordance with the terms of Developer's partnership agreement to the extent permitted by the AHA, nor shall Transfer include a sale to National Community Renaissance of California, a California nonprofit public benefit corporation and/or San Diego Community Housing Corporation, a California nonprofit public benefit corporation after the expiration of the tax credit period. "Transfer" shall not include a Transfer permitted in the AHA or the leasing of individual Units on the Property so long as Trustor complies with the provisions of the AHA relating to such leasing activity. Failure of Beneficiary to exercise the option to declare all sums secured hereby immediately due and payable upon a Transfer will not constitute waiver of the right to exercise this option in the event of any subsequent Transfer.

6. Subordination to Multifamily. Developer and the Payee each makes the following representations and warranties to [name of lender's agent: to come], as Agent("Agent"):
"The indebtedness evidenced by this Promissory Note is and shall be subordinate in right of payment to the prior payment in full of the indebtedness evidenced by a Multifamily Note of even date herewith in the original principal amount of[approximately$ ] issued by Santa Fe Senior Village, LP and payable to [to come] ("Senior Lender"), or order, to the extent and in the manner provided in that certain Subordination Agreement, dated as of , 202_, between the payee of this Promissory Note, and the Senior Lender and the maker of the Promissory Note (the "Senior Lender Subordination Agreement"). The mortgage or deed of trust securing this Promissory Note is and shall be subject and subordinate in all respects to the Assignment of Rents, Security Agreement and Fixture Filing securing the rights and remedies of the payee and each subsequent holder of this Promissory Note under the mortgage or deed of trust securing this Promissory Note are subject to the restrictions and limitations set forth in the Subordination Agreement. Each subsequent holder of this Promissory Note shall be deemed, by virtue of such holder's acquisition of the Promissory Note,to have agreed to perform and observe all of the terms, covenants and conditions to be performed or observed by the Subordinate Lender under the Subordination Agreement."
In the event of the refinancing of the senior loan for an amount not in excess of the outstanding principal balance of the existing senior loan and reasonable and customary closing costs, City will execute an instrument or instruments evidencing the subordination of the indebtedness evidenced by this Promissory Note to such new senior loan.

The deed of trust securing this Promissory Note shall also be subordinate to the deed of trust securing repayment of the County Loans.

7. Miscellaneous.
(a) Governing Law. All questions with respect to the construction of this Promissory Note and the rights and liabilities of the parties to this Promissory Note shall be governed by the laws of the State of California.

Attachment No. 6

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(b) Binding on Successors. This Promissory Note shall inure to the benefit of, and shall be binding upon, the successors and assigns of each of the parties to this Promissory Note. (c) Attorneys' Fees.
(i) Maker shall reimburse Payee for all reasonable attorneys' fees, costs and expenses, incurred by Payee in connection with the enforcement of Payee's rights under this Promissory Note,including,without limitation,reasonable attorneys' fees,costs and expenses for trial, appellate proceedings,out-of-court negotiations,workouts and settlements or for enforcement of rights under any state or federal statute, including, without limitation, reasonable attorneys' fees, costs and expenses incurred to protect Payee's security and attorneys' fees, costs and expenses incurred in bankruptcy and insolvency proceedings such as (but not limited to) seeking relief from stay in a bankruptcy proceeding. The term "expenses" means any expenses incurred by Payee in connection with any of the out-of-court, or state, federal or bankruptcy proceedings referred to above, including, without limitation, the fees and expenses of any appraisers, consultants and expert witnesses retained or consulted by Payee in connection with any such proceeding. (ii) Payee shall also be entitled to its reasonable attorneys' fees, costs and expenses incurred in any post judgment proceedings to collect and enforce the judgment. This provision is separate and several and shall survive the merger of this Promissory Note into any judgment on this Promissory Note.
(d) Entire Agreement. This Promissory Note and the relevant provisions of the AHA constitute the entire agreement and understanding between and among the parties in respect of the subject matter of such agreements and supersede all prior agreements and understandings with respect to such subject matter,whether oral or written. (e) Time of the Essence. Time if of the essence with respect to every provision hereof.
(f) Waivers by Maker. Except as otherwise provided in any agreement executed in connection with this Promissory Note, Maker waives: presentment; demand; notice of dishonor; notice of default or delinquency; notice of acceleration; notice of protest and nonpayment; notice of costs, expenses or losses and interest thereon; and diligence in taking any action to collect any sums arising under this Promissory Note or in any proceeding against any of the rights or interests in or to properties securing payment of this Promissory Note.
(g) Non-waivers. No previous waiver and no failure or delay by Maker in acting with respect to the terms of this Promissory Note or the Commission Deed of Trust shall constitute a waiver of any breach, default, or failure of condition under this Promissory Note, the Commission Deed of Trust or the obligations secured thereby. A waiver of any term of this Promissory Note, the Commission Deed of Trust or of any of the obligations secured thereby must be made in writing and shall be limited to the express written terms of such waiver. In the event of any inconsistencies between the terms of this Promissory Note and the terms of any other document related to the loan evidenced by this Promissory Note,the terms of this Promissory Note shall prevail. (h) Non-recourse Liability of Developer. Notwithstanding anything to the contrary of this Promissory Note, neither Developer nor any of its partners shall be personally liable Attachment No. 6

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for any default, loss, claim, damage, expense or liability or any person and the sole remedy against Developer hereunder shall be limited to its interest in the Development. (signature on following page)
Attachment No. 6

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Theodore T. Miyahara
Its: President& Chief Executive Officer
Attachment No. 6

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ATTACHMENT NO. 7

REQUEST FOR NOTICE OF DEFAULT

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

Community Development Commission of the
City of Vista
200 Civic Center Drive
Vista, California 92084
Attention: Executive Director

SPACE ABOVE THIS LINE FOR RECORDER'S USE ONLY
Exempt from recording fees pursuant to Government Code§6103.

Request for Notice Under Section 2924b Civil Code
In accordance with Section 2924b,Civil Code,request is hereby made that a copy of any Notice of Default and a copy of any Notice of Sale under the Deed of Trust recorded as Instrument No. on , 202_, in Book , Page , Official Records of San Diego County, California, and describing land therein as
See Exhibit A attached hereto
executed by , as Trustor, in which is named as Beneficiary, and as Trustee, be mailed to Community Development Commission of the City of Vista, at 200 Civic Center Drive, Vista, California 92084, Attention: Executive Director.

NOTICE: A COPY OF ANY NOTICE OF DEFAULT AND OF ANY NOTICE OF SALE WILL BE SENT ONLY TO THE ADDRESS CONTAINED IN THIS RECORDED REQUEST.

IF YOUR ADDRESS CHANGES,A REQUEST MUST BE RECORDED.

Executive Director
Date:

Attachment No. 7

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

STATE OF CALIFORNIA )
ss.

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

I certify under 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.

Signature of Notary Public

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

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

Signer is representing: Date Of Documents Name Of Person(s)Or Entity(ies)
Signer(s)Other Than Named Above
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ATTACHMENT NO. 8

SCOPE OF DEVELOPMENT
I. GENERAL DESCRIPTION
The Site is specifically delineated on the Site Map and the Legal Description of the Site.

II. DEVELOPMENT
Developer shall construct fifty four (54) apartment units on the Site, together with all on-site and off-site features described in this Scope of Development(consistent with the conceptual drawings as presented to the City Council of the City on January 23, 2023, including without limitation landscaping. Existing units may be maintained in their existing sizes so long as such units satisfy the City Code and all applicable laws. Improvements to be made under this Agreement, including all conditions of development now or hereafter imposed by City (including without limitation and mitigation measures) collectively constitute the"Improvements." The quality of construction shall be of a high level. The Improvements shall conform to such plans as are approved by City and maintained on file with City as supplemented by the Design Development Drawings (the "Approved Plans"). Improvements shall conform to approvals given by City under Building Permit Case No. B22-1877.

Developer shall commence and complete the Improvements by the respective times established therefor in the Schedule of Performance.

III. DEVELOPMENT STANDARDS
The Improvements shall conform to all applicable state laws and regulations and to local zoning, applicable provisions of the City Code and the following development standards:

A. General Requirements:

1. Vehicular Access. The placement of vehicular driveways shall be coordinated with the needs of proper street traffic flow as approved by City. All access driveways shall require written approval of City staff.

2. Building Signs. Existing signs on the Site must conform to the City Code.

Additional or new signs on the Site shall be limited in size, subdued and otherwise designed to contribute positively to the environment. Signs identifying the building use will be permitted,but their height, size, location, color, lighting and design will be subject to City staff approval, and signs must conform to the City Code.

3. Screening. All outdoor storage of materials or equipment shall be enclosed or screened to the extent and in the manner required by City staff.

Attachment No. 8

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4. Landscaping. Developer shall continue to provide existing landscaping; additional landscaping shall conform to plans as hereafter approved by City.

Landscaping shall consist of trees, shrubs and installation of an automatic irrigation system adequate to maintain such plant material. The type and size of trees to be planted, together with a landscaping plan, shall be subject to City staff approval prior to planting.

5. Utilities. All utilities on the Site provided to service the units constructed by Developer shall be underground at Developer's expense.

6. Building Design. Buildings shall be constructed such that the Improvements shall be of high architectural quality and shall be effectively and aesthetically designed and in conformance with City approvals.

7. Mitigation Measures. Mitigation measures approved for the Development under the California Environmental Quality Act(CEQA).

B. Design Features:

The following design features are considered essential components to the Improvements:

Handicapped Units — The City shall designate the number of Units shall be fully handicapped accessible to the extent necessary to achieve compliance with State Housing Code- Title 24 requirements.

Securi - The details of security will be reviewed upon submission of the detailed plans.

Overall Design Quality, Materials, Colors, Design Features - Quality of design is important,materials and colors are to be approved by City.

Housing Type—Fifty one(51) studio Units,two(2)one bedroom Unit,and a manager Unit which may consist of two (2)bedrooms.

Mobility/Agility-All facilities shall comply with all TCAC and HOME requirements applicable to the Project.

IV. DEMOLITION AND SOILS
Developer assumes all responsibility for surface and subsurface conditions at the Site and the suitability of the Site for the Improvements. Developer has,prior to the Date of Agreement,undertaken all investigation of the Site as it shall deem necessary and has not received or relied upon any representations of Commission, City, or their respective officers, agents and employees.

Attachment No. 8

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V. SPECIAL AMENITIES
Developer shall undertake all new improvements required by City as a condition of development of the Site, and specifically new resident amenities to include features as hereafter designated by the City in connection with a development approval by City or otherwise agreed to by Developer.

Attachment No. 8

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ATTACHMENT NO. 9

CERTIFICATE OF COMPLETION

RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:

APN:
(Space Above for Recorder's Use Only)
This document is exempt from the payment of a recording fee pursuant to Government Code Section 27383.

CERTIFICATE OF COMPLETION
THIS CERTIFICATE OF COMPLETION (the "Certificate") is made by the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA, a public body, corporate and politic (the "Commission"), in favor of SANTA FE SENIOR VILLAGE, LP, a California limited partnership (the"Developer"), as of the date set forth below.

RECITALS
A. Commission, the City of Vista, a Charter city duly organized and acting under and by virtue of the Constitution and laws of the State of California(the"City"), and Developer have entered into that certain unrecorded Affordable Housing Agreement(the"AHA")dated as of January 23,2023, concerning the redevelopment of certain real property situated in the City of Vista, California,as more fully described in Exhibit"A" attached hereto and made a part hereof(the"Site").

B. As referenced in Section 4.13 of the AHA, Commission is required to furnish Developer or its successors with a Certificate of Completion upon completion of construction of the "Improvements" (as defined in Section 1.1 of the AHA), which Certificate is required to be in such form as to permit it to be recorded in the Recorder's Office of San Diego County. This Certificate is conclusive determination of satisfactory completion of the construction and development required by the AHA.

Attachment No. 9

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C. Commission has conclusively determined that the construction and development of the Development has been satisfactorily completed.

NOW, THEREFORE, Commission hereby certifies as follows:

I. Commission does hereby certify that the Improvements to be constructed by Developer has been fully and satisfactorily completed in full conformance with the AHA.

2. This Certificate shall not constitute evidence of compliance with or satisfaction of any obligation of Developer to any holder of a mortgage, or any insurer of a mortgage, securing money loaned to finance construction work on the Site, or any part thereof.

3. This Certificate shall not constitute evidence of Developer's compliance with those covenants in the AHA that survive the issuance of this Certificate or without certain unrecorded agreement by and among Commission, City, and Santa Fe Senior Village L.P., a California limited partnership entitled "Affordable Housing Agreement" dated as of January 23, 2023 (the "AHA"), a copy of which is on file with City as a public record.

4. This Certificate is not a Notice of Completion as referred to in California Civil Code Section 3093.

5. Nothing contained in this instrument shall modify in any other way any other provisions of the AHA(including without limitation the attachments thereto).

IN WITNESS WHEREOF,Commission has executed this Certificate of Completion this day of , 202_.

COMMUNITY DEVELOPMENT COMMISSION
OF THE CITY OF VISTA, a public body, corporate
and politic
By:

Amanda Lee, Acting Executive Director
ATTEST:

Kathy Valdez, Secretary
Attachment No. 9

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EXHIBIT "A" TO ATTACHMENT NO.9

LEGAL DESCRIPTION
[to come]
Exhibit"A"to Attachment No. 9

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ATTACHMENT NO. 10

COMMISSION REGULATORY AGREEMENT
RECORDING REQUESTED BY:

WHEN RECORDED RETURN TO:

Community Development Commission of the
City of Vista
200 Civic Center Drive
Vista, California 92084
Attention: Executive Director
(Space above for Recorder's Use.)
This document is exempt from the payment of a recording fee pursuant to Government Code Section 6103.

REGULATORY AGREEMENT
These Covenants,Conditions and Restrictions,herein sometimes referred to as these"CC&Rs" or "Declaration" or "Regulatory Agreement" or "Commission Regulatory Agreement" are made by the signatories hereto.

RECITALS
WHEREAS, each of the COMMUNITY DEVELOPMENT COMMISSION OF THE CITY OF VISTA, a public body, corporate and politic ("Commission"), the CITY OF VISTA, a charter city duly organized and existing under and by virtue of the Constitution and the laws of the State of California ("City"), and SANTA FE SENIOR VILLAGE, LP, a California limited partnership ("Developer") is a party to this Declaration. Commission, City and Developer are sometimes collectively referred to herein as the "Declarants." WHEREAS, Commission, City and Developer have entered into that certain unrecorded Affordable Housing Agreement dated as of January 23, 2023 (the "AHA") for the improvement and development of certain real property described in Exhibit"A"(to which these CC&Rs are attached)as the "Site", which AHA provides for the recordation of this Regulatory Agreement. The AHA is incorporated herein by this reference and any capitalized term not defined herein shall have the meaning established therefor in the AHA. City is a third party beneficiary of the AHA.

Attachment No. 10
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WHEREAS,this Regulatory Agreement establishes a plan for the improvement,development and maintenance of the Site, for the benefit of City and Commission.

WHEREAS, Developer is the fee owner of the "Site" as described in the legal description attached hereto as Exhibit"A" and incorporated herein by this reference.

WHEREAS, the AHA sets forth certain restrictive covenants applicable to the Site, particularly the use of the Site for the provision of rental housing units available to 30% AMI Low Income Households and 40%AMI Very Low Income Households at Affordable Rents as those terms are defined therein.

WHEREAS, Commission, City, and Developer wish to adopt this Regulatory Agreement to further govern the use of the Site in conjunction and along with the AHA and to ensure that Commission achieves credit for production of affordable housing units in the manner described by Section 33413 of the California Health and Safety Code.

NOW, THEREFORE, Commission and City each of Developer (as owner of real property interests described hereinabove), in City, declares that the Site shall be held,transferred, encumbered, used, sold, conveyed, leased and occupied subject to the Covenants, Conditions and Restrictions hereinafter set forth expressly and exclusively for the use and benefit of said property,and Commission and City. Each and all of the restrictions, limitations, conditions, covenants, liens, reservations and charges herein contained shall run with the land and be recorded on the property title and shall be binding on Declarants,their grantees, successors,heirs, executors, administrators, devisees or assigns, and all subsequent owners of all or any part of the Site.

ARTICLE I

DEFINITIONS
The definitions provided herein shall be applicable to this Declaration and also to any amendment or supplemental Declaration (unless the context implicitly or explicitly shall prohibit), recorded against the Site pursuant to the provision of this Declaration. Any capitalized terms not defined herein shall have the respective meanings set forth therefor in the AHA.

Section 1. "Affiliated Person" means, when used in reference to a specific person, any person that directly or indirectly controls or is controlled by or under common control with the specified person,any person that is an officer or director of,a trustee of,or a general partner,managing member or operator in, the specified person or of which the specified person is an officer, director, trustee, general partner or managing member, or any person that directly or indirectly is the beneficial owner of ten percent (10%) or more of any class of the outstanding voting securities of the specified person.

Section 2. "Affordable Rent" means rent that does not exceed the maximum rent allowable by TCAC for the corresponding income level (namely, 30% AMI Extremely Low Income Households and 40% AMI Very Low Income Households). In the event TCAC ceases to publish affordable rents for San Diego County, affordable rents shall thereupon be determined in accordance with Health& Safety Code Sections 50052.5 and 50053.

Attachment No. 10

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Section 3. "Applicable Federal Rate" means the interest rate set by the United States Treasury from time to time for the purpose of determining applicable Low Income Housing Tax Credit interest rates. The Applicable Federal Rate is published by the Internal Revenue Service in monthly revenue rulings.

Section 4. "Approved Construction and/or Permanent Lender" means one or more of Bank of America, California Community Reinvestment Corporation ("CCRC"), Union Bank, Wells Fargo Bank, Citibank, U.S. Bank, Citi Bank, Banner Bank, Century Housing, or another mutually acceptable reputable and established bank, savings and loan association, or other similar financial institution or a state agency or instrumentality, but not Ca1HFA, the Federal National Mortgage Association(Fannie Mae) or Freddie Mae.

Section 5. "Area" means the San Diego Primary Metropolitan Statistical Area, as periodically defined by HUD.

Section 6. "Audit" is defined in Section 4.17.1 of the AHA.

Section 7. "Audited Financial Statement"means an audited financial statement,including without limitation a profit and loss statement, generated by Leaf & Cole, LLP, Novogradac, CohnReznick, or another third party certified public accountant acceptable to Commission in its reasonable discretion, showing, for the previous Regulatory Agreement Year, in an easily readable format, Gross Revenues, Operating Expenses, Debt Service, Capital Replacement Reserve, General Partner Fee, Limited Partner Fee and Residual Receipts.

Section 8. "Base Pro Forma" means that certain pro forma so labelled and dated as of February 8,2022, as on file with the Commission.

Section 9. "Capital Replacement Reserve"means a reserve fund to be established by the Developer in an amount as set forth in the Base Pro Forma or as otherwise designated by the Executive Director. To the extent Developer is required to maintain a Capital Replacement Reserve by any Approved Construction and/or Permanent Lender,Developer shall receive a credit hereunder for such amounts maintained by it in compliance with such Approved Construction and/or Permanent Lender capital replacement reserve requirement.

Section 10. "Certificate of Continuing Program Compliance" means the Certificate to be filed by Developer or its property manager on behalf of Developer with Commission,which Certificate shall be substantially in the form of Attachment No. 4 to the AHA.

Section 11. "Ci1y"means the City of Vista,a charter city duly organized and existing under and by virtue of the Constitution and laws of the State of California.

Section 12. "Cijy Code"means the Municipal Code of the City of Vista as may be amended from time to time.

Section 13. "Commencement Date" means the date the Commission Regulatory Agreement is recorded among the Official Records.

Attachment No. 10

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Section 14. "Commission" means the Community Development Commission of the City of Vista, a public body, corporate and politic, acting as a housing authority exercising governmental functions and powers and organized under the Housing Authorities Law, and any assignee of or successor to its rights,powers and responsibilities.

Section 15. "Co "means the County of San Diego, California.

Section 16. "Date of Agreement"means January 23, 2023.

Section 17. "Debt Service" means required debt service payments for the Primary Construction Loan and/or the Primary Permanent Loan including the funding obligations in respect of all reserves or escrows required thereunder and scheduled payments as approved as part of the Final Financing Package.

Section 18. "Developer", as defined in the first paragraph hereof, means Santa Fe Senior Village, LP, a California limited partnership.

Section 19. "Developer Fee" means the sum of Two Million Two Hundred Thousand Dollars ($2,200,000.00).

Section 20. "Development"means the apartment complex and associated improvements as required by the AHA to be: (i) constructed by Developer upon the Site as more particularly described in the Scope of Development, and (ii) operated as an affordable housing complex in conformity with the Commission Regulatory Agreement.

Section 21. "Environmental Laws" means all laws, ordinances and regulations relating to Hazardous Materials, including,without limitation: the Clean Air Act, as amended,42 U.S.C. Section 7401, et seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq.; the Resource Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901, et seq.; the Comprehensive Environment Response, Compensation and Liability Act of 1980, as amended (including the Superfund Amendments and Reauthorization Act of 1986, "CERCLA"), 42 U.S.C.

Section 22. "Executive Director" means the Executive Director of Commission or his or her designee or delegate.

Section 23. "General Partner Fee"means a fee if charged by the general partner; provided that the General Partner Fee together with the Limited Partner Fee shall not for any Regulatory Agreement Year exceed the amount permitted under the AHA for the Partnership Fees (as such fees are aggregated).

Attachment No. 10

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Section 24. "Gross Revenues" means the sum of: the total rental income and all other revenues or income received by the Developer or its successors or assigns in connection with the Development, including without limitation Housing Rent, laundry charges (as received by Developer) or consideration received from an entity that contracts to provide laundry services, payments in connection with Section 8 certificates, if any, cable income or consideration received from an entity that contracts to provide cable services, each of(i) amounts paid to Developer or any Affiliated Person on account of Operating Expenses for further disbursement by Developer or such affiliate to a third party or parties, including,without limitation, grants received to fund social services or other housing supportive services at the Development; (ii) late charges and interest paid on rentals; (iii)rents and receipts from licenses, concessions, vending machines, coin laundry, and similar sources; (iv) other fees, charges, or payments not denominated as rental but payable to Developer in connection with the rental of office,retail, storage, or other space in the Development; (v) consideration received in whole or in part for the cancellation,modification, extension or renewal of leases; and(vi) interest and other investment earnings on security deposits, reserve accounts and other Development accounts to the extent disbursed, but does not include: (x)the proceeds of the sale of Tax Credits to finance the Development; (y)Refinancing Net Proceeds (provided the refinancing is permitted by and is accomplished in accordance with the AHA); (z) insurance proceeds applied to reconstruct or repair the Improvements.

Section 25. "Hazardous Material" or "Hazardous Materials" means and include any substance, material, or waste which is or becomes regulated by any local governmental authority, including the County,the Regional Water Quality Control Board,the State of California,or the United States Government, including, but not limited to, any material or substance which is: (i) defined as a "hazardous waste,""acutely hazardous waste,""restricted hazardous waste,"or"extremely hazardous waste"under Sections 25115, 25117 or 25122.7, or listed pursuant to Section 25140, of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law); (ii) defined as a "hazardous substance" under Section 25316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter Presley Tanner Hazardous Substance Account Act); (iii) defined as a "hazardous material," "hazardous substance," or "hazardous waste" under Section 25501 of the California Health and Safety Code,Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory); (iv) defined as a "hazardous substance" under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); (v) petroleum; (vi) asbestos and/or asbestos containing materials; (vii) lead based paint or any lead based or lead products; (viii) polychlorinated biphenyls, (ix) designated as a "hazardous substance" pursuant to Section 311 of the Clean Water Act(33 U.S.C. Section 1317); (x) defined as a"hazardous waste"pursuant to Section 1004 of the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq. (42 U.S.C. Section 6903); (xi) Methyl tertiary Butyl Ether; (xii) defined as "hazardous substances"pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act,42 U.S.C. Section 9601, et seq. (42 U.S.C. Section 9601); (xiii)any other substance, whether in the form of a solid, liquid, gas or any other form whatsoever,which by any"Governmental Requirements" (which shall be deemed to mean the requirements under the provisions of law cited in this definition)either requires special handling in its use,transportation,generation,collection,storage, handling, treatment or disposal, or is defined as "hazardous" or harmful to the environment; and/or (xiv)lead based paint pursuant to and defined in the Lead Based Paint Poisoning Prevention Act,Title X of the 1992 Housing and Community Development Act, 42 U.S.C. § 4800, et seq., specifically §§ 4821-4846, and the implementing regulations thereto. Notwithstanding the foregoing, "Hazardous Materials" shall not include such products in quantities below attainment levels identified in one or Attachment No. 10

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more of the enactments identified above as Governmental Requirements,including those products and amounts as are customarily used in the construction, maintenance, rehabilitation, management, operation and residence of residential developments or associated buildings and grounds, or typically used in residential activities in a manner typical of other comparable residential developments, or substances commonly ingested by a significant population living within the Development, including without limitation alcohol, aspirin,tobacco and saccharine.

Section 26. "Hazardous Materials Contamination" means the contamination (whether presently existing or hereafter occurring)of the improvements,facilities,soil,groundwater,air or other elements on, in, or under the Site by Hazardous Materials, or the contamination of the buildings, facilities, soil, groundwater, air or other elements on, in or of any other property as a result of Hazardous Materials at any time (whether before or after the Date of Agreement) emanating from the Site.

Section 27. "HCD" means the Housing and Community Development Department of the State of California.

Section 28. "Housing Rent"means the total of monthly payments by the tenants of a Unit for (a)use and occupancy for the Unit and facilities associated therewith, (b) any separately charged fees or service charges assessed by Developer which are required of all tenants of the Units, other than security deposits, (c) a reasonable allowance for utilities not included in (a) or(b) above, including garbage collection, sewer,water,electricity and gas,as determined by regulation of Housing Authority of the County of San Diego pursuant to 24 C.F.R. Section 5.600 et seq. or by the California Utility Allowance Calculator as permitted by TCAC (unless the cost for utilities is absorbed by Developer), and(d)possessory interest,taxes or other fees or charges assessed for the use of the Units and facilities associated therewith by a public or private entity other than Developer;provided that the rent charged as to any Required Affordable Unit shall not exceed Affordable Rent. Developer has represented to Commission that Developer will absorb all utility costs.

Section 29. "Improvements" means all of the improvements to be constructed for the Development as described in the Scope of Development required to be developed for the benefit of the users of the Site pursuant to the AHA.

Section 30. "Income Verification" means a verification in the form of Attachment No. 11 to the AHA;provided that such form is subject to modification from time to time with the prior written approval of the Executive Director.

Section 31. "Legal Description of the Site"means Exhibit"A"hereto.

Section 32. "Limited Partner Fee"means a fee if charged by the limited partner under the Partnership Agreement; provided that the General Partner Fee together with the Limited Partner Fee shall not for any Regulatory Agreement Year exceed the amount permitted under the ABA for the Partnership Fees (as such fees are aggregated).

Section 33. "Median Income" means Median Income for the Area (namely, San Diego County), as set forth by regulation of the California Department of Housing and Community Development pursuant to Health and Safety Code Sections 50079.5 and 50105.

Attachment No. 10

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Vista City CouncilJanuary 10, 2023

Vista City Council
January 10, 2023