Southern California Edison Revised Cal. PUC Sheet No. 87557-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 65295-E
Schedule NEM-ST Sheet 22 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 22C11 Resolution
SPECIAL CONDITIONS (continued)
4. Billing. (continued)
j. California Climate Credit Cash-Out Provision for Residential Customers.
Customers receiving service on a Residential rate schedule receive a semi-annual California Climate Credit from the State of California. In the event that a portion or all of the dollar value of the California Climate Credit cannot be consumed by the end of the Customer’s Relevant Period, one of the following will occur: (1) for Residential Net Surplus Generators eligible to receive NSC via the separate check option – any remaining California Climate Credit balance will be added to the NSC owed the Customer and sent with the NSC check, or (2) for all other Residential Customers – any remaining California Climate Credit balance will be sent to the Customer via a separate check after the final billing statement for the current Relevant Period is issued.
Southern California Edison Revised Cal. PUC Sheet No. 87558-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 65296-E
Schedule NEM-ST Sheet 23 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 23C11 Resolution
SPECIAL CONDITIONS (continued)
5. NEM Aggregation (NEM-A).
Pursuant to D.16-01-044, Customers served under this Schedule who have additional metered service accounts located on property where the Generating Facility is located and/or on property adjacent or contiguous to the property on which the Generating Facility is located, if those properties are all solely owned, leased, or rented by the Customer, may choose to have the electrical load (kWh) served by such meters aggregated for the purposes of determining if the Customer is a net consumer or a net producer of energy. For the purposes of NEM-A only, parcels that are divided by a street, highway, or public thoroughfare are considered contiguous, provided they are within an unbroken chain of otherwise contiguous parcels and are all solely owned, leased or rented by the Customer, as verified in Form 14-937. Customers are also eligible to participate in NEM-A where all meters in an NEM-A arrangement are located within an unbroken chain of contiguous parcels that are all solely owned, leased, or rented by the Customer. For example, if there are three parcels (A, B and C), all of which are solely owned, leased or rented by the Customer, where A contains the Generating Facility and abuts B, B abuts C, but A and C are separated by B, then the loads of all three parcels shall be eligible to participate in NEM-A. Refer to Diagram 1 (for illustrative purposes only). In addition, if there are five parcels (A, B, C, D and E) that form a cluster of contiguous parcels, where A contains the Generating Facility, and D and E are separated from A, B, and C by a street, highway or public thoroughfare, for the purposes of participating in NEM-A only, all five parcels are considered contiguous, provided they are otherwise contiguous and all solely owned, leased or rented by the Customer. Refer to Diagram 2 (for illustrative purposes only).
The Customer must provide SCE with a list of additional metered service accounts on Form 14-937 (subject to eligibility verification by SCE) that are to be included in the NEM-A arrangement, which consists of the account directly interconnected to and located on the same property as the Generating Facility (the generating account, which is also considered an aggregated account when allocated kWh) and all aggregated accounts. A Customer may have more than one NEM-A arrangement, but accounts may not be shared across multiple arrangements. Aggregated accounts may not have any other NEM Eligible Generators directly interconnected to them, but are permitted to have Non-NEM Eligible Generators directly interconnected to them. All accounts in an NEM-A arrangement must be (1) all Bundled Service accounts; or (2) all DA Service accounts served by the same ESP; or (3) all CCA or CA Service accounts served by the same Community Choice Aggregator or Community Aggregator.
Southern California Edison Revised Cal. PUC Sheet No. 87559-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 65297-E
Schedule NEM-ST Sheet 24 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 24C11 Resolution
SPECIAL CONDITIONS (continued)
5. NEM Aggregation (NEM-A). (continued)
A Customer may elect to modify the aggregated accounts included in an NEM-A arrangement, provided a minimum of 60-days’ notice is provided to SCE prior to the change taking effect, and such change remains in effect for a minimum of 12 months and doesn’t result in the Generating Facility being oversized compared to the electrical requirements of the NEM-A arrangement.
Customers electing to participate in NEM-Aggregation are required to pay all applicable charges, including energy, non-energy and NBCs, on a monthly basis in accordance with their OAT, pursuant to the provisions of Special Condition 4.b. All accounts in an NEM-A arrangement will be placed on the same billing cycle, and will be billed individually pursuant to the Rates section and Special Condition 4 of this Schedule. The electrical consumption (kWh) registered on each account’s meter will be reduced, for purposes of billing monthly energy charges and credits as described in the Rates section, by a proportional allocation, at the 15- minute interval level, of the electricity generated by the Generating Facility that is exported to SCE’s grid. The proportional allocation is determined per billing period based on the cumulative consumption of each aggregated account compared to the cumulative consumption of the NEMA arrangement since the start of the Relevant Period, and the cumulative generation exported from the Generating Facility since the start of the Relevant Period. The Customer is required to designate one account in the NEM-A arrangement to receive any remaining kWh not allocated due to rounding after the proportional allocation methodology described above is completed. All accounts included in an NEM-A arrangement are ineligible to receive NSC from SCE. However, if an aggregated account that is not a generating account is separated from the NEM-A arrangement, and subsequently qualifies for service under this Schedule, that account is eligible to receive NSC on a going-forward basis, provided it meets all other NEM-ST eligibility criteria.
Aggregated accounts are eligible for the same demand response programs as other Customers served under this Schedule. All demand response programmatic elements (e.g., eligibility) and payments to aggregated accounts are based on the metered usage disregarding any contributions from kWh allocated to the aggregated accounts based on the proportional allocation methodology described above.
Customers electing to participate in NEM-A are not eligible to concurrently participate under the terms of Special Condition 7.a of this Schedule, as provided. Customers may dual participate under the terms of Special Condition 7.b of this Schedule, provided there is only one NEM-ST Generating Facility behind the same meter as the Non-NEM Eligible Generator(s).
Existing Customers served under this Schedule who elect to participate in NEM-A who also have existing executed NEM-ST Interconnection Agreements and who are making no modifications to their Generating Facilities other than electing NEM-A will not be required to complete new Interconnection Agreements, nor conduct new interconnection studies.
Southern California Edison Revised Cal. PUC Sheet No. 87560-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 85447-E
Schedule NEM-ST Sheet 25
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E-A Michael Backstrom Date Submitted Mar 28, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 25C15 Resolution
SPECIAL CONDITIONS (continued)
5. NEM Aggregation (NEM-A). (continued)
In lieu of interconnecting the Generating Facility to an existing metered service account, Customers electing to participate in NEM-A may request an additional service from SCE for the purposes of interconnecting the Generating Facility. This additional service and associated metering must be located on the same property as the Generating Facility at a location approved by SCE and must not result in adverse impacts to SCE’s electrical system, as determined by SCE. No additional load other than incidental load related to the inverters and support of the Generating Facility may be registered on this additional metered service. This additional service and associated metering are provided under the Added Facilities provisions of SCE’s Electric Rule 2.H and are at the Customer’s expense. The new service will be billed monthly for any charges of its OAT not already provided for under Added Facilities.
This Schedule will remain available for Customers submitting interconnection applications for NEM-A between April 15, 2023 and February 14, 2024, provided Customers demonstrate their NEM-A arrangement had at least two existing aggregated accounts as of December 15, 2022.
NEM-A Customers with an application date on or after April 15, 2023, will have a nine-year Transition Period on this Schedule pursuant to D.22-12-056 commencing on their original PTO.
NEM-A Sunset Date. The NEM-A sunset period begins November 16, 2023, and ends on February 14, 2024. Pursuant to D.23-11-068, customers who prior to February 15, 2024, submit all necessary documentation (i.e., a completed interconnection application free of major deficiencies) may receive service on this Schedule.
Consistent with the intent of D.23-11-068, Customers will have three years from February 14, 2024, to interconnect and submit final building permit sign off and electrical clearing by the authority having jurisdiction to remain eligible for this Schedule and the provisions contained within. SCE is granted the discretion to provide Schedule NEM-ST (i.e., NEM-A) tariff eligibility to a Customer if a delay in meeting the NEM-A Sunset Date (February 14, 2024) is caused by SCE. Similarly, SCE has the discretion to apply NEM-A eligibility to Customers who fail to submit the final building permit sign off and other necessary documentation within three years from February 14, 2024, if such failure is due to delays caused by SCE. NBT-A Customers submitting interconnection applications on or after February 15, 2024, referred to as NBT-A Transition Customers (as defined in Schedule NBT), will be billed on this Schedule temporarily and then subsequently transitioned to Schedule NBT-A once it is operational. Customers will be transitioned to Schedule NBT-A at the end of their Relevant Period following SCE’s implementation of Schedule NBT-A, with a nine-year Eligibility Period commencing the date of the Customer’s original PTO.
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Southern California Edison Revised Cal. PUC Sheet No. 87561-E Rosemead, California (U 338-E) Cancelling Original Cal. PUC Sheet No. 85448-E
Schedule NEM-ST Sheet 26 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 26C12 Resolution
SPECIAL CONDITIONS (continued)
6. NEM-Paired Storage Systems.
Pursuant to D.16-04-020, D.16-01-044 and D.14-05-033, where a Customer utilizes a NEMPaired Storage System (as defined in Special Condition 1.g), the applicable provisions of this Special Condition 6 shall apply. Additionally, where this Special Condition conflicts with any other Special Condition within this Schedule, the provisions contained in this Special Condition shall prevail. Customers with NEM-Paired Storage Systems who take service under this Special Condition are exempt from Supplemental Review fees, Detailed Study costs, and the costs associated with any Distribution or Network upgrades triggered by the Interconnection Request, provided the Renewable Generator is sized 1 MW or smaller.i Customers with NEM-Paired
Storage Systems who take service under this Special Condition are exempt from Standby charges.
a. Sizing Requirements. The size of the Integrated or Directly Connected Energy Storage Device is determined by the inverter alternating current (AC) nameplate rating. i. Small NEM-Paired Storage System: There are no additional sizing requirements for the Integrated or Directly Connected Energy Storage Device(s) relative to the size of the Renewable Generator.
ii. Large NEM-Paired Storage System: The maximum aggregate output capacity of the Integrated or Directly Connected Energy Storage Device(s) can be no greater than 150 percent of the Renewable Generator’s maximum output capacity. For example, if the maximum output capacity of the Renewable Generator is 15 kW, the maximum aggregate output capacity of the Integrated or Directly Connected Energy Storage Device(s) can be no greater than 22.5 kW. Pursuant to D.20-06-017, the maximum aggregate output capacity limitation shall not apply for a period of three years beginning August 16, 2020 and ending August 15, 2023.
iii. Direct Current-Coupled NEM-Paired Storage System: The system size shall be determined as the lesser of the shared inverter’s nameplate capacity and the storage device’s maximum continuous output rating. Continuous output of a storage device is determined by referring to the device’s technical specifications sheets. If that metric is not included, the inverter nameplate will be used.
i
In the event the Integrated or Directly Connected Energy Storage Device is added subsequent to the date that the Renewable Generator received Permission to Operate, the same interconnection cost categories applicable to the Renewable Generator shall apply to the Integrated or Directly Connected Energy Storage Device. Customers defined in Special Conditions 1.a.ii and 1.a.iii do not receive these cost exemptions.
Southern California Edison Revised Cal. PUC Sheet No. 87562-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 66672-E
Schedule NEM-ST Sheet 27 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 27C11 Resolution
SPECIAL CONDITIONS (continued)
6. NEM-Paired Storage Systems. (continued)
b. Metering Requirements.
i. Small NEM-Paired Storage Systems.
A. Solar Photovoltaic (PV): Where the Renewable Generator(s) utilizes solar PV only, an estimation methodology, as described in Section 6.c below, shall apply in lieu of additional metering. As an alternative option, at the start of a new Relevant Period, a Customer may elect to adhere to the metering and billing requirements applicable to Large NEM-Paired Storage Systems. Customers who elect this option shall not be subject to the estimation methodology so long as they adhere to the necessary metering requirements. The cost of the metering required under this option shall not exceed $600, unless Complex Metering, as described below, is required. For Small NEM-Paired Storage Systems that are unable to meet the metering requirements of Large NEM-Paired Storage Systems, the estimation methodology shall apply. Where the Small NEM-Paired Storage System is combined in a Multiple Tariff Generating Facility pursuant to Special Condition 7 of this Schedule and the Renewable Generator(s) utilizes NGOM, the billing provisions of Special Condition 7 will apply and not the estimation methodology described in Section 6.c below.
B. Non-Solar PV: Where the Renewable Generator(s) utilizes a technology other than only solar PV, the Customer must adhere to the metering and billing requirements applicable to Large NEM-Paired Storage Systems. The cost of the metering required under this provision shall not exceed $600, unless Complex Metering, as described below, is required.
ii. Large NEM-Paired Storage Systems.
A. The Customer must adhere to the metering and billing requirements contained within Special Condition 7.b of this Schedule or use power control-based options described below. For metering and billing purposes only, the Integrated or Directly Connected Energy Storage Device is treated as the Non-NEM Eligible Generator when applying the provisions of Special Condition 7.b. The cost of the metering required under this provision shall not exceed $600, unless Complex Metering, as described below, is required. Generating Facilities that are unable to meet the metering requirements of Special Condition 7.b are ineligible for service under this Schedule as a NEM-Paired Storage System.
B. Power control-based firmware or software options shall be certified to a national standard. Power control-based options include using equipment that prevents electricity to be exported from the storage device to the grid, and using equipment that prevents electricity imported from the grid to charge the storage device. Open loop response time outlined in the control technical specification documentation must not be greater than 10 seconds.
Southern California Edison Revised Cal. PUC Sheet No. 87563-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 65300-E
Schedule NEM-ST Sheet 28 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 28C11 Resolution
SPECIAL CONDITIONS (continued)
6. NEM-Paired Storage Systems. (continued)
c. Estimation Methodology for Small NEM-Paired Storage Systems (where storage is < or = 10 kW rated capacity).
Small NEM-Paired Storage billing uses an “estimation method” that caps maximum allowable NEM bill credits based on solar photovoltaic (PV) generation estimates. The approach used to develop the generation estimates applied to NEM-Paired Storage billing is as follows:
i. SCE has established a maximum cap for NEM‐eligible exports by California Energy Commission (CEC) Climate Zone for each calendar month based on standardized monthly estimates that are scaled for a given NEM customer based on the size of the customer’s solar system.
ii. To develop the generation estimates, SCE used the California Solar Initiative Expected Performance-Based Buydown (CSI EPBB) calculator to produce a single, scalable, production factor table. This table captures the estimated amount of kWh generated per installed kW of solar PV capacity (kWh/kW production factor) for each calendar month and each of the nine CEC Climate Zones in SCE’s service area.
Climate Zones are referred to as Baseline Regions in SCE’s tariffs. iii. For a given NEM-Paired Storage customer, the NEM-eligible cap on exports is calculated by multiplying the Customer-appropriate production factor for a given month and Climate Zone (based on billing period and location) and scaling the kWh by the customer’s PV installed capacity (in kW).
iv. The solar PV configuration assumptions used in the CSI EPBB calculator to generate the scalable production factor table are the following:
• Tilt: If Optimal Tilt as defined by the EPBB Calculator was <20 degrees for a given Climate Zone, then 20 degree tilt was used, otherwise Optimal Tilt as defined by the EPBB Calculator was used • Azimuth: 180 degrees
• For each climate zone, identified the three zip codes with the most residential PV installations; chose the zip code with the highest generation estimate per the EPBB calculator
• Panel: SunPower.SPR-327NE-WHT-D
• Inverter: SPR-X20-327-C-AC (240V) or any other micro-inverter designed to match the panels.
o As a reference, inverter efficiency is 96%. • Mounting Method: > 6 “ average standoff (EPBB default) • Shade: Minimal (EPBB default)
Southern California Edison Revised Cal. PUC Sheet No. 87564-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 74403-E
Schedule NEM-ST Sheet 29 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 29C11 Resolution
SPECIAL CONDITIONS (continued)
6. NEM-Paired Storage Systems. (continued)
c. Estimation Methodology for Small NEM-Paired Storage Systems…(Continued) v. Once implemented in SCE’s billing system, Customers subject to this provision shall have a maximum monthly generation output cap established for each calendar month based on the “production factor table.”
vi. In all cases, the first day of the Customer’s Billing Period determines which calendar month cap is used for that Billing Period. For example, if the Customer’s Billing Period starts on January 15 and ends on February 15, the January cap is used. vii. Any export (EF) registered on SCE’s revenue meter(s) that exceeds the monthly cap is not eligible for credit as outlined in the Rates section above and is forfeited by the Customer. For example, if a Customer’s monthly cap amount for January is 500 kWh and the Customer exports 525 kWh for that monthly Billing Period, 25 kWh are not eligible for NEM credit and are forfeited. The forfeited kWh are assumed to have occurred during the Customer’s highest priced TOU period, regardless of when the energy was actually exported. If the amount of forfeited kWh for a Billing Period exceeds the amount of EF registered during the Customer’s highest priced TOU period, the remaining kWh subject to forfeit are then removed from the next highest priced TOU period and so on until all kWh subject to forfeit are accounted for. For example, if a Customer has a July monthly cap amount of 700 kWh and exports 1,000 kWh, 300 kWh must be forfeited. If the Customer exported 200 kWh in the Summer On-peak period and 800 kWh in the Summer Mid-Peak period, 200 kWh of the forfeited 300 kWh are removed from the Summer On-Peak period (so the Customer’s EF during the Summer On-Peak period is billed at zero); the remaining 100 kWh of the forfeited 300 kWh are removed from the Summer Mid-Peak period (so the Customer’s EF during the Summer Mid-Peak period is billed at 700 kWh). Forfeited kWh are not eligible for NSC.
d. Interconnection and Safety Requirements. NEM-Paired Storage Systems must meet the technical and safety standards required for interconnection under Rule 21 or the CAISO Tariff, as applicable. This includes evaluation under the same technical interconnection standards currently applied to Generating Facilities that are not paired with energy storage devices.
e. NEM Transition Provisions. NEM-Paired Storage Systems are subject to the transition provisions included in Special Condition 8 below. In regards to Special Condition 8.b, NEM-Paired Storage Systems shall remain eligible for service under this Schedule provided the capacity of the Integrated or Directly Connected Energy Storage Device(s) is not increased by more than 10 percent of its original maximum aggregate output capacity.
Southern California Edison Revised Cal. PUC Sheet No. 87565-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 65302-E
Schedule NEM-ST Sheet 30 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 30C11 Resolution
SPECIAL CONDITIONS (continued)
7. Customers with a Multiple Tariff Generating Facility (NEM-MT).
Where a Customer utilizes a Multiple Tariff Generating Facility (as defined in Special Condition 1), the applicable provisions of this Special Condition 7 shall apply. Additionally, where this Special Condition conflicts with any other Special Condition contained herein, the provisions contained in this Special Condition shall prevail. Customers served pursuant to this Special Condition are responsible for paying NBCs, as defined in the Rates section above, on each kWh of electricity that is consumed from the grid net of exports (i.e., net consumption) in each metered interval as recorded on the TOU revenue meter at the Point of Common Coupling (PCC). Multiple Tariff Generating Facilities consisting of generating facilities served under Schedules FC-NEM or BG-NEM that receive service pursuant to Special Condition 7.a below are not eligible to concurrently participate in an NEM-A arrangement pursuant to Special Condition 5 above. For purposes of tariff administration, other metering configurations than those outlined below may be allowed at SCE’s discretion. a. A Customer utilizing a Multiple Tariff Generating Facility consisting of all NEM Eligible Generating Facilities, with at least one NEM-ST Generating Facility, shall adhere to the following:
i. Where a Customer chooses not to install separate Net Generation Output Metering (NGOM) on each group of NEM Eligible Generators (as defined in Special Condition 1 above), all energy exported to SCE’s system from any group of NEM Eligible Generators shall receive only the generation component energy credits per the Customer’s OAT. The NEM credits will not include any portion of the Delivery Service energy rate components, or any other component of the Customer’s OAT, unless separate NGOMs are installed on each group of NEM Eligible Generators. A Customer with a Multiple Tariff Generating Facility that includes a Renewable Electrical Generating Facility served under this Schedule shall be responsible for all nonbypassable charges as specified herein.
ii. Where a Customer chooses to install NGOM on a group of NEM Eligible Generators, the NGOM must conform to the requirements set forth in SCE’s Electric Rule 21, Section J. The total energy exported to SCE’s system, as determined at the PCC meter (SCE billing meter) will be allocated to each group based on its NGOM reading to the total of all NGOM readings. For example, if the SCE billing meter registered 900 kWh of energy exported to SCE’s system, and during that same time period a group of NEM Eligible Generators (group 1) had an NGOM registration of 2,000 kWh, while another group of NEM Eligible Generators (group 2) had an NGOM registration of 4,000 kWh, then group 1 would be allocated 300 kWh and group 2 would be allocated 600 kWh, for NEM crediting purpose.
Southern California Edison Revised Cal. PUC Sheet No. 87566-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 65303-E
Schedule NEM-ST Sheet 31 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 31C11 Resolution
SPECIAL CONDITIONS (continued)
7. Customers with a Multiple Tariff Generating Facility (NEM-MT). (continued) b. A Customer with a Multiple Tariff Generating Facility consisting of one or more NEM Eligible Generators served under this Schedule and one or more Non-NEM Eligible Generators (defined in Special Condition 1 above) shall adhere to the following:
i. Where all Non-NEM Eligible Generators have a non-export relay (reverse or minimum power protection), per SCE’s Electric Rule 21, Section G.1.i, Screen 2 (option 1 or 2), thus assuring no export to SCE’s system from any Non-NEM Eligible Generator, the Customer is not required to install NGOM on their NEM Eligible Generator(s). However, where a Customer’s Multiple Tariff Generating Facility includes more than one group of NEM Eligible Generators, NGOM in accordance with Special Condition 7.a.ii above must be installed to determine which percentage of the measured excess energy exported to SCE’s system will receive NEM energy credits at the bundled rate (Delivery Service plus generation) and which percentage of the measured excess energy exported to SCE’s system will receive NEM energy credits at the generation rate component only. Otherwise, unallocated NEM-eligible excess energy exported to SCE’s system will be subject to the provisions of Special Condition 7.a.i above. ii. Where one or more of the Customer’s Non-NEM Eligible Generators does not have a non-export relay, and where each group of the NEM Eligible Generators does not have NGOM installed in accordance with Special Condition 7.a.ii above, NEM credits will only be applicable on the NEM Eligible Generators that do have NGOM. Monthly valued NEM credits for each of the NEM-Eligible Generator groups with NGOM will be the lesser of (A) its proportion of the NGOM reading to the total of all NEM Eligible Generators’ NGOM readings multiplied at the PCC, or (N) its NGOM reading. iii. The value of energy credits will be applied consistent with the appropriate NEM tariff as follows, including the requirement that Customers with a Multiple Tariff Generating Facility that includes a Renewable Electrical Generating Facility served under this Schedule shall be responsible for all nonbypassable charges as specified herein:
A. First, apply BG-NEM and/or FC-NEM generation rate component credits (if any) to generation rate component charges on any aggregated account served by the Generating Facility.
B. Second, apply any remaining BG-NEM and/or FC-NEM credits from (A) above to the remainder of generation rate component charges on the account served by the Generating Facility.
C. Third, apply NEM-ST energy (generation and delivery service rate component) credits to any remaining energy charges of the accounts that are served by the Generating Facility.
D. Fourth, apply NEM energy (generation and delivery service rate component) credits to any remaining energy charges of the accounts that are served by the Generating Facility.
Southern California Edison Revised Cal. PUC Sheet No. 87567-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 85449-E
Schedule NEM-ST Sheet 32 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 32C12 Resolution
SPECIAL CONDITIONS (continued)
8. NEM-ST Legacy Provisions. This Special Condition is applicable to all Customers receiving service on this Schedule and to all Customers who have submitted an interconnection application free of all major deficiencies by April 14, 2023. a. 20-Year Transition Period.
Pursuant to D.16-01-044, Customers who are receiving service on this Schedule, or who have submitted all documentation necessary to receive service on this Schedule, are eligible to continue receiving service on this Schedule for a period of 20 years from the original year in which their Generating Facility was interconnected to SCE’s grid, indicated by and measured from the date on which the Customer originally received permission to operate (PTO) the Generating Facility from SCE and ending at the conclusion of the Customer’s applicable Relevant Period that ends immediately on or after the 20th anniversary of the original PTO date. For example, if a Customer initially received PTO on April 1, 2018, the Customer is eligible to continue receiving service on this Schedule through the conclusion of the Relevant Period ending immediately on or after March 31, 2038. b. Modifications.
Generating Facilities eligible for the 20-year transition period outlined above that are modified and/or repaired shall remain eligible for the remainder of their 20-year transition period as long as the modifications and/or repairs do not increase the Generating Facility by more than the greater of (1) 10 percent of the Generating Facility’s nameplate rating capacity, as established when the Generating Facility was originally interconnected, or (2) 1 kW; and provided the modifications and/or repairs do not result in the Generating Facility exceeding the Customer’s annual onsite load. Customers making modifications and/or additions to their Generating Facilities that exceed the 10 percent or 1 kW limit referenced above have the option of either (a) interconnecting the additions and/or modifications separately under a Rule 21 Non-Export agreement (so long as they demonstrate that the expansion uses a non-export relay, or any other control system, to prevent the expansion from exporting to the grid) without losing its 20-year NEM eligible period, or (b) having the entire Generating Facility served under another eligible tariff, subject to the terms and conditions contained therein.
This provision is only applicable if, at the time of the customer request for an expansion above the threshold described above, an eligible successor tariff is available and applicable to the Generating Facility. Otherwise, the legacy period for the Generating Facility will not be affected by the proposed modification.
(T)
Southern California Edison Revised Cal. PUC Sheet No. 89085-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 87568-E
Schedule NEM-ST Sheet 33
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5394-E Michael Backstrom Date Submitted Oct 25, 2024 Decision 24-03-071 Vice President Effective Oct 25, 2024 33C8 Resolution
SPECIAL CONDITIONS (continued)
8. NEM-ST Legacy Provisions. (continued)
c. Transferability.
Generating Facilities eligible for the 20-year transition period shall not lose their eligibility if transferred to a new owner, operator, or SCE account, provided the Generating Facility remains at its original location.i
The transfer of an existing Generating Facility to a new location is considered a new installation requiring a new Interconnection Agreement that is subject to the applicable tariffs in place at the time the new Interconnection Request is completed.
d. Integrated or Directly Connected Energy Storage Devices.
Integrated or Directly Connected Energy Storage Devices shall be treated in the same way, and be subject to the same transition period, as the Renewable Generator to which they are connected. Pursuant to D.22-12-056. Customers adding only energy storage to their existing Generating Facility shall remain eligible for the remainder of their 20-year Transition Period of this Schedule; however, customers adding storage to their existing Generating Facility through participation in the Self-Generation Incentive Program (SGIP) will be required to transition to the Net Billing Tariff pursuant to D.24-03-071 if they apply and have a reservation accepted on or after June 4, 2024. Customers participating in the following SGIP budget categories, as defined in D.24-03-071, are exempt from this requirement:
Residential Solar and Storage Equity, low-income qualified Equity Resiliency residential, and San Joaquin Valley Residential.
(N)
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(N)
i The Generating Facility must at all times serve an Eligible Customer-Generator as defined in Special Condition 1.a above.
Southern California Edison Revised Cal. PUC Sheet No. 87569-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 85451-E
Schedule NEM-ST Sheet 34 (T)
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E Michael Backstrom Date Submitted Feb 12, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 34C11 Resolution
SPECIAL CONDITIONS (continued)
9. Natural Disaster (Disaster): This Special Condition is applicable to NEM-ST Legacy Eligible Customer-Generators impacted by an event in affected area declared in a state of emergencyi and included in either the California Governor’s Proclamation of a State of Emergency or the President of the United States’. Disaster impacted customers will retain their original permission to operate (PTO) date. The original 20-Year Transition Period will remain in effect under this Schedule as defined in Special Condition 8.
Disaster impacted Eligible Customer-Generators must:
a. Submit a new Interconnection Request with a replacement Renewable Electrical Generating Facility sized to generate no more than 12 months of historic, or estimated, usage (kWh), and
b. Submit proof of destruction of the Renewable Electrical Generating Facility, if requested by SCE.
c. If the Renewable Electrical Generating Facility needs to be replaced due to a Disaster, SCE will true-up all charges and credits pursuant to Special Condition 4.e up to the date of the Disaster, unless the Eligible Customer-Generator requests that SCE continue to bill through the end of the Relevant Period.
d. The period from destruction of the Renewable Electrical Generating Facility to PTO of the replacement Renewable Electrical Generating Facility must not exceed four years, unless reasonable documentation acceptable to SCE is provided showing that a new Interconnection Request has been submitted. The new Interconnection Request must be completed by the same Customer of Record who was taking service under Schedule NEM-ST prior to the Disaster. If the Renewable Electrical Generating Facility is not replaced by the Customer, but the property is sold to a new Customer after the destruction of the Renewable Electrical Generating Facility, this provision does not extend to the new Customer of Record or New Party In.
e. Customers impacted by a Disaster who meet the requirements included in this Special Condition and whose replacement system is sized no greater than 1 megawatt (MW) are exempt from the interconnection application fee when submitting a new Interconnection Request.
i Government Code 8558(b) - https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=GOV§ionNum=8558
Southern California Edison Revised Cal. PUC Sheet No. 87570-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 87131-E
Schedule NEM-ST Sheet 35
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5203-E-B Michael Backstrom Date Submitted Jul 25, 2024 Decision 23-11-068 Vice President Effective Feb 15, 2024 35C15 Resolution
SPECIAL CONDITIONS (continued)
10. NEM-ST Sunset Date. The NEM-ST Sunset Period begins on December 15, 2022 and ends on April 15, 2023, except for NEM-A customers pursuant to Special Condition 5. Pursuant to D.22-12-056, Customers who prior to April 15, 2023, submit all necessary documentation (i.e., a completed interconnection application free of major deficiencies) may receive service on this Schedule.
Consistent with the intent of D.22-12-056, all Customers will have three years from April 14, 2023 to interconnect and submit final building permit sign off and electrical clearing by the authority having jurisdiction to remain eligible for this Schedule and the provisions contained within. SCE is granted the discretion to provide Schedule NEM-ST tariff eligibility to a Customer if a delay in meeting the NEM-ST Sunset Date (April 14, 2023) is caused by SCE.
Similarly, SCE has the discretion to apply NEM-ST eligibility to Customers who fail to submit the final building permit sign off and other necessary documentation within three years from April 14, 2023 if such failure is due to delays caused by SCE.
NBT Customers submitting interconnection applications on or after April 15, 2023, referred to as NBT Transition Customers (as defined in Schedule NBT), will be billed on this Schedule temporarily, will be billed on the monthly billing option which is consistent with Schedule NBT, and then subsequently transitioned to Schedule NBT once it is operational. Customers will be transitioned to Schedule NBT at the end of their Relevant Period following SCE’s implementation of Schedule NBT, with a nine-year Eligibility Period commencing the date of the Customer’s original PTO.
This Schedule will remain available for Customers submitting interconnection applications for NEM-A between April 15, 2023, and February 14. 2024, provided Customers demonstrate their NEM-A arrangement had at least two existing aggregated accounts as of December 15, 2022. NEM-A Customers with an application date on or after April 15, 2023, will have a nineyear Transition Period on this Schedule pursuant to D.22-12-056 commencing on their original PTO.
REQUIRED DISCLOSURE
Interconnection Requests submitted pursuant to SCE’s Rule 21 are subject to SCE’s Rule 21 protocols including the Confidentiality provisions (Section D.7) and the “Required Disclosure” (Section D.7.d). As a condition of taking service under this Schedule, pursuant to CPUC Decisions (D.)14-11-001 and D.21-06-026, SCE is required to provide certain data, including, but not limited to, confidential customer information, to the CPUC, its contractors, the California Department of Consumer Affairs Contractors State License Board, and the California Department of Financial Protection & Innovation. Customer authorizes SCE to release any and all information contained in the application for interconnection to the entities identified above without further notification or consent. (T)
(T)
(T)
(D)
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Southern California Edison Original Cal. PUC Sheet No. 88775-E Rosemead, California (U 338-E) Cancelling Cal. PUC Sheet No.
Schedule NEM-ST Sheet 36
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5353-E Michael Backstrom Date Submitted Aug 13, 2023 Decision 23-11-068 Vice President Effective
36C8 Resolution
SPECIAL CONDITIONS (Continued)
11. Prevailing Wage
California Public Utilities (PU) Code Section 769.2 requires a contractor that installs a Renewable Electrical Generation Facility or associated battery storage to comply with prevailing wage requirements in order for the facility to participate in a tariff developed pursuant to PU Code Section 2827 or 2827.1. These requirements are stated in PU Code Section 769.2 and in case of any discrepancy between tariff language and the PU Code, the language in the PU Code prevails.
The requirements are:
(1) The contractor shall pay each construction worker employed, at minimum, the general prevailing rate of per diem wages, except that an apprentice registered in a program approved by the Chief of the Division of Apprenticeship Standards shall be paid, at minimum, the applicable apprentice prevailing rate.
(2) The contractor shall maintain and verify payroll records pursuant to Section 1776 of the Labor Code and make those records available for inspection and copying as provided in that Section. The contractor shall not be required to provide copies of certified payroll records to any entity other than the Department of Industrial Relations or the California Public Utilities Commission (Commission).viii (3) The contractor shall biannually, on July 1 and December 31 of each year, submit to the Commission digital copies of its certified payroll records for projects.ixii The contractor’s submission of payroll records is a condition to access tariffs developed pursuant to PU Code Section 2827 or 2827.1 for a Customer’s Renewable Electrical Generating Facility subject to PU Code Section 769.2.
(N)
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viii Pursuant to Decision 23-11-068 the contractor may also be required to provide these records to any entity that the Commission designates to act on its behalf to implement this requirement. ixiiContractors may submit their records on a voluntary basis more often than the biannual requirement stated in the PU Code 769.2.
(N)
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Southern California Edison Original Cal. PUC Sheet No. 88776-E Rosemead, California (U 338-E) Cancelling Cal. PUC Sheet No.
Schedule NEM-ST Sheet 37
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5353-E Michael Backstrom Date Submitted Aug 13, 2023 Decision 23-11-068 Vice President Effective
37C7 Resolution
SPECIAL CONDITIONS (Continued)
11. Prevailing Wage (Continued)
The requirements of PU Code Section 769.2 do not apply to projects with a complete interconnection application submission date before January 1, 2024.xi All projects with an
interconnection application submission date on or after January 1, 2024, including applications to modify an existing Renewable Electrical Generating Facility, are subject to the PU Code Section 769.2 requirements with the following exceptions:
(1) A residential Renewable Electrical Generating Facility that has a maximum generating capacity of 15 kilowatts or less of electricity.
(2) A residential Renewable Electrical Generating Facility that is installed on a singlefamily home. (3) A project that is a public work, as defined in Section 1720 of the Labor Code, and that is subject to Article 2 (commencing with Section 1770) of Chapter 1 of Part 7 of Division 2 of the Labor Code.
(4) A Renewable Electrical Generating Facility that serves only a Modular Home, a Modular Home Community, or multiunit housing that has two or fewer stories.
If PU Code Section 769.2 applies, the Customer must execute the “Prevailing Wage Disclosure Form” and submit the form with their interconnection application, and Customer’s contractor shall confirm to SCE that it is up to date with their past required submittals of payroll records.
If Customer's contractor has been found to have willfully violated PU Code Section 769.2 in connection with the construction of Customer's Renewable Electrical Generating Facility, that facility shall not be eligible to receive service pursuant to a tariff developed based on PU Code Sections 2827 or 2827.1. Only in the case of multi-tariff configuration, where there is more than one renewable generator behind the same utility billing meter, SCE will treat all the generators as one system and therefore none of the renewable generators will be served on tariffs developed based on PU Code Section 2827 or 2827.1, and those renewable generators will be compensated based on PURPA compliant tariff, regardless which facility is subject to the violation of PU Code 769.2. (N)
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ix
If a Customer or contractor provides documentation confirming that the facility that they are applying for was built on or before December 31, 2023, the prevailing wage requirements will not apply to that project. (N)
(N)
Southern California Edison Original Cal. PUC Sheet No. 88777-E Rosemead, California (U 338-E) Cancelling Cal. PUC Sheet No.
Schedule NEM-ST Sheet 38
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5353-E Michael Backstrom Date Submitted Aug 13, 2023 Decision 23-11-068 Vice President Effective
38C7 Resolution
SPECIAL CONDITIONS (Continued)
11. Prevailing Wage (Continued)
If a willful wage violation is alleged, the Customer’s Renewable Electrical Generating Facility will remain on the tariff until the Department of Industrial Relations (Department) or a court completes their assessment and makes a final determination. At that time, if the contractor is found in willful violation, then SCE will be required to remove the Customer’s Renewable Electrical Generating Facility implicated by the violation from this Schedule and transition the Customer to the PURPA compliant tariff on the next billing cycle (after the required 30/60-day notification). While on the PURPA compliant tariff, the Renewable Electrical Generating Facility will be compensated based on that tariff and the Renewable Electrical Generating Facility shall be subject to SCE Schedule Customer Generation Departing Load Cost Responsibility Surcharge and SCE Schedule Standby charges as the Renewable Electrical Generating Facility is no longer eligible to be served on tariffs developed pursuant to PU Code Section 2827 or 2827.1. The Customer’s Renewable Electrical Generating Facility billing meter will be trued up at the end of the billing cycle (after the required 30/60-day notification) before transitioning to the PURPA compliant tariff and any credits remaining after the true-up (including all benefitting/ aggregated accounts) will be forfeited.
If the violation occurs on a single generating account and there are no benefitting/aggregated account(s), SCE will notify the Customer at least 30-days in advance of automatically transitioning the Customer's Renewable Electrical Generating Facility on their next billing cycle to a PURPA compliant tariff.
If the violation occurs on a single generating with benefitting/aggregated accounts SCE will notify the Customer(s) at least 60-days in advance of automatically transitioning the Customer's Renewable Electrical Generating Facility on their next billing cycle to a PURPA compliant tariff.
If a willful wage violation is reversed or nullified by the determining body and the generation account holder or Customer/property owner provides documentation to the utility evidencing such reversal/nullification, then the Renewable Electrical Generating Facility (or the whole system for multi-tariff) will be able to regain access to the applicable NEM/NBT tariff as of the next billing cycle or within 30-days after receiving the notification of the reversal of the willful wage violation.
Beginning January 1, 2025, contractors who have been found in willful violation of the prevailing wage rule in PU Code Section 769.2 will not be permitted to apply to interconnect facilities utilizing tariffs established pursuant to PU Code Sections 2827 or 2827.1. (N)
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(N)
Southern California Edison Original Cal. PUC Sheet No. 88778-E Rosemead, California (U 338-E) Cancelling Revised Cal. PUC Sheet No. 74404-E
Schedule NEM-ST Sheet 39
NET ENERGY METERING
SUCCESSOR TARIFF
(Continued)
(Continued)
(To be inserted by utility) Issued by (To be inserted by Cal. PUC) Advice 5353-E Michael Backstrom Date Submitted Aug 13, 2023 Decision 23-11-068 Vice President Effective
39C9 Resolution
REQUIRED DISCLOSURE
All customers must: Accept that SCE may release to the California Energy Commission, the California Public Utilities Commission, and/or other state agencies, information regarding the Customer’s facility, including such Customer’s name and Renewable Electrical Generating Facility location, capacity, and operational characteristics. Pursuant to CPUC Decisions 14-11- 001, 21-06-026, and 23-11-068, SCE is required to provide certain data, including, but not limited to, confidential Customer information, to the CPUC, its contractors, the California Department of Consumer Affairs Contractors State License Board, the California Department of Financial Protection & Innovation, and the California Department of Industrial Relations. As a condition of receiving service under this tariff, the eligible customer authorizes SCE to release any and all information provided in the Interconnection Request to the entities identified above without further notification or consent. For Renewable Electrical Generating Facilities that are subject to Pub. Util. Code § 769.2, in addition to consenting to SCE sharing the data or information with those regulatory entities, Customer also consents to those entities making that information publicly available.
(L)(D)
(N)
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(N)
CONSENT TO COLLATERAL ASSIGNMENT OF SOLAR PROJECT DOCUMENTS
AND EQUIPMENT SUBORDINATION
This Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination, dated as of April_____________, 2026 (this “Consent”), is made by the City of Yorba Linda (the “Host”), and CF FFP Yorba Linda CC LLC (a California limited liability company and assignee of Greenskies Clean Energy LLC) and is provided for the benefit of KeyBank National Association (the “Construction Lender”) and the sale-leaseback lessor to be identified in the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent (the “SLB Lessor”), in connection with those certain solar project documents (the “Solar Project Documents”) identified in Schedule A to this Consent, and relates to the solar photovoltaic system (the “System”) to be located at the site (the “Site”) identified in Schedule A to this Consent.
Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Solar Project Documents. The term “Financing Party,” as used in this Consent, shall refer to Construction Lender prior to the Sale Leaseback Transaction (as such term is defined herein) for a specific System, and to SLB Lessor on or after the Sale Leaseback Transaction for the specific System.
1. Acknowledgment and Consent.
a. The Host acknowledges that CF FFP Yorba Linda CC LLC (the “Company”) is entering into a construction financing agreement with Construction Lender to finance the building of the System (the “Construction Financing”) and will enter into one or more sale-leaseback transactions (each a “Sale Leaseback Transaction”, collectively the “Sale Leaseback Transactions”) with SLB Lessor, whereby the Company will sell its rights, interests and obligations in and to the System to SLB Lessor, and in connection therewith SLB Lessor will lease the System to the Company (collectively, the “Transactions”). b. Host acknowledges that, as a part of the Transactions, the Company may assign the Solar Project Documents to a sister entity not long after the date hereof, and may subsequently further assign the Solar Project Documents to another sister entity in connection with the Transactions (collectively the “Provider Assignees”). c. In order to secure its obligations under the Transactions, the Company (i) is collaterally assigning and granting to Construction Lender a first-priority security interest in all of the Company’s right, title and interest in, to and under the System and the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents, in connection with the Construction Financing, and (ii) in connection with the Sale Leaseback Transactions (A) will convey the System to the SLB Lessor and (B) will collaterally assign and grant to the SLB Lessor a first-priority security interest in all of the Company’s right, title and interest in, to and under the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents.
d. To the extent consent is not already granted in the Solar Project Documents, Host consents to the transactions set forth in subparts (a) through (c) above.
2. Financing Party's Rights. Notwithstanding any contrary term in the Solar Project Documents:
a. the Financing Party shall be entitled to exercise any and all rights of secured parties generally with respect to the Solar Project Documents; b. the Host agrees that the Host will provide to the Financing Party notice of any default by the Company and other material notices under the Solar Project Documents and will permit the Financing Party the same cure periods as are available to the Company under the Solar Project Documents, provided that the Financing Party shall have an additional ninety (90) days to cure any default the Company has not cured within the cure period permitted, so long as the Financing Party is diligently proceeding to cause a cure; and further provided that any period to cause a cure shall be tolled if the Financing Party is prohibited from curing any default due to bankruptcy of the Company or by any other process, stay or injunction issued by any court or governmental authority;
c. if, in connection with the exercise of any of its rights and remedies, the Financing Party elects to exercise step-in rights under, or become party to, the Solar Project Documents, the Financing Party shall use commercially reasonable efforts to ensure that the System remains under the care of a Qualified Operator and a “Qualified Operator” is a business organization which has the skillset and experience to operate and service the System in accordance with the terms of the Solar Project Documents and the Company acknowledges and agrees that the Financing Party shall not be bound by the terms of the Solar Project Documents unless and until the Financing Party becomes a party to such Solar Project Documents; and d. if the Financing Party transfers the Company’s (or any Provider Assignee’s) interests in the Solar Project Documents to a third party (an “Assignee”), so long as the Assignee is also a Qualified Operator, (i) the Host shall recognize the respective Assignee as the counterparty under the Solar Project Documents; (ii) the Host shall continue to perform its obligations under the Solar Project Documents in favor of such Assignee; and (iii) the Financing Party shall be released from any further liability thereunder (other than those obligations arising prior to the date of such assignment or those obligations that are not assumed).
3. Payments Under Solar Project Documents. The Host shall pay all amounts payable by it under the Solar Project Documents, if any, in lawful money of the United States of America, in immediately available funds, directly into the account specified below (or, after delivery of the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent, into the account specified in such notice) or to such other person or account as may be specified from time to time by the Financing Party to the Host in writing.
Bank: KeyBank National Association
ABA Routing Number: 041001039
Account Number: 359681786224
Account Name: OBO CF Holdco KBC LLC – Controlled Account
4. Representations and Warranties of Host. The Host hereby represents and warrants to the Financing Party as follows:
a. the Host is duly organized, validly existing and in good standing under the laws of California and has all requisite power and authority to execute and deliver, and to perform its obligations under, the Solar Project Documents and this Consent; b. the execution, delivery and performance by the Host of this Consent have been duly authorized by all necessary action and, as of the date hereof, do not require any further consents or approvals that have not been obtained;
c. the execution, delivery and performance by the Host of this Consent will not (i) violate any provision of any law, regulation, order, judgment, injunction or similar matters applicable to it; or (ii) conflict with, result in a breach of or violate any of the terms, conditions or provisions of the Host’s formation, constituent or governing documents; d. this Consent and the Solar Project Documents are legal, valid and binding obligations of the Host enforceable against the Host in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general; and
e. as of the date hereof, the Host has no knowledge of a Force Majeure event having occurred under the Solar Project Documents.
5. Representations and Warranties of Company. The Company hereby represents and warrants to the Financing Party and the Host that the Company has the full power, authority and legal right to execute, deliver and perform its obligations under this Consent and the Solar Project Documents. This Consent has been duly executed and delivered by the Company, and this Consent and the Solar Project Documents are legal, valid and binding obligations of the Company enforceable against Company in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general.
6. Confirmation and Agreement. The Host confirms the following matters for the benefit of the Financing Party with respect to the Solar Project Documents and the Systems. a. As of the date hereof, the Host has not taken any official action requiring or authorizing, entered into any approval to exercise or decided whether it will exercise, in each case, any purchase option available to the Host in connection with the System, nor is the Host under any legal or economic compulsion to exercise any such purchase option. Notwithstanding anything in any Solar Project Document to the contrary, the Host hereby agrees that its exercise of any purchase option available to it with respect to the System (other than any such purchase option arising with respect to the sixth (6th), tenth (10th) or fifteenth (15th) anniversary of the Commercial Operation Date (as defined in the Solar Project Documents) or upon the end of the Initial Term (as defined in the Solar Project Documents)) is subject to the SLB Lessor’s prior written consent as owner of the System (not to be unreasonably withheld, conditioned or delayed). b. To the Host’s knowledge, there exists no default or event or condition that
would, with the giving of notice or lapse of time, constitute a default under the Solar Project Documents, and each of the Company and the Host has fulfilled all of its respective obligations under the Solar Project Documents to the extent such obligations are required to be performed as of the date hereof.
c. The Host owns the Site where the System has been or will be installed.
The Host acknowledges and agrees that the Site noted in Schedule A is correct. d. The interest of the Financing Party in the System shall at all times be superior to any interest the Host may now or hereafter have in the System, and the Host hereby subordinates any lien, encumbrance or interest heretofore or hereafter created that the Host may have in the System, whether such lien, encumbrance or interest is statutory or by agreement, to the title, lien, encumbrance or interest of the Financing Party, regardless of the timing or order of creation or any perfection, and whether or not the System (or any part thereof) is deemed a fixture on the Site. The Host agrees that the System is, and shall at all times remain, personal property notwithstanding that it may be installed on or affixed to the Site. e. Without limitation of the foregoing, the Host grants to the Financing Party and its agents, employees and contractors a license to enter upon the Site and remove the System for up to one hundred eighty (180) days after notice to Financing Party of the termination or expiration of the Solar Project Documents, with such one hundred eighty (180) day period being tolled for any period of time during which the Financing Party is stayed from removing the System by a proceeding in bankruptcy with respect to the Company. The Host agrees not to hinder such exercise of remedies under the Solar Project Documents or this Consent. If the Financing Party elects to remove the System then the Financing Party shall perform such removal in accordance with the terms of the Solar Project Documents, provided that the Financing Party shall have no obligations to remove substructures installed in order to support the System.
f. The Solar Project Documents are in full force and effect and have not been amended except as explicitly indicated in Schedule A, and there are no other agreements or representations of any kind between the Host and the Company other than the Solar Project Documents listed in Schedule A.
g. The Host will use commercially reasonable efforts to place its direct successors, assigns and lien holders on notice of the ownership of the System by the Financing Party, the existence of Financing Party’s security interest in the Solar Project Documents, and the fact that the System is not part of the Site or fixtures thereof, as necessary and appropriate to avoid confusion or adverse claims.
h. The Host acknowledges that, under the Transaction, the Company is not permitted to agree to an amendment or assignment of the Solar Project Documents without the prior written consent of the Financing Party, which shall not be unreasonably withheld, conditioned, or delayed.
i. There is no mortgage, financing statement, fixture filing, lien, or other encumbrance (a “Lien”) attached to the Site described in the Solar Project Documents.
Notwithstanding the foregoing, if the Company or the Financing Party discovers a Lien on the Site that could reasonably be construed as prospectively attaching to the System, the Host will secure, or otherwise cooperate with the Company and the Financing Party to secure, any nondisturbance agreement, lien waiver, disclaimer, or other documentation (“Waiver Documentation”) determined by the Financing Party as necessary and appropriate to avoid confusion or adverse claims.
j. There is no easement, license, restrictive covenant, or other such real estate interest (“Site Interest”), whether possessory or non-possessory, that will adversely affect the Company’s ability to develop, construct, operate, maintain, and decommission the System in accordance with the Solar Project Documents. Notwithstanding the foregoing, if the Company or the Financing Party discovers a Site Interest on the Sites that could reasonably be construed as prospectively adversely affecting the Company’s ability to comply with the Solar Project Documents, the Host will secure or otherwise cooperate with the Company and the Financing Party to secure any Waiver Documentation determined by Financing Party as necessary and appropriate to permit full compliance with the Solar Project Documents. k. The Host confirms that it intends to fulfill its obligations under the Solar Project Documents, including ensuring that sufficient monies are appropriated in accordance with applicable law.
l. The Host and the Company confirm as of the date hereof, no liquidated damages or other such payments are due and owing.
7. General.
a. Unless otherwise expressly specified or permitted by the terms hereof, all communications and notices provided for herein shall be in writing, and any such communication or notice shall become effective (i) upon personal delivery thereof, including, without limitation, by overnight mail or courier service; (ii) in the case of notice by United States mail, certified or registered, postage prepaid, return receipt requested, upon receipt thereof; or (iii) in the case of notice by email, upon confirmation of receipt thereof in writing by the intended recipient, and provided such email transmission is promptly further confirmed by any of the methods set forth in clauses (i) or (ii) above, in each case addressed to each party hereto at its address set forth below or, in the case of any such party hereto, at such other address as such party may from time to time designate by written notice to the other parties hereto:
If to the Host: As noted in the Solar Project
Documents
If to Financing Party:
Construction Lender
KeyBank National Association
127 Public Square
Cleveland, OH 44114-1306
Attn: E. Clare Morter
Tel: (216) 471-4982
E-mail: [email protected]
E-mail:
[email protected]
with a copy to:
KeyBank National Association
4900 Tiedeman Road
Cleveland, OH 44114
Mail Code: OH-01-51-0575
Attn: Key Agency Services
Tel: (216) 813-1950
Email: [email protected]
SLB Lessor
As set forth in the “Notice of SLB Transaction” in
the form attached as Exhibit A to this Consent.
If to Company:
CF Holdco KBC LLC
c/o GREENSKIES CLEAN ENERGY LLC
127 Washington Avenue
West Building, Lower Level
North Haven, CT 06473
Attn: General Counsel
With a copy to: [email protected]
b. This Consent may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Consent by facsimile or e-mail (including “pdf” format) or other electronic means shall be effective as delivery of an original executed counterpart of this Consent.
c. In case any provision of this Consent, or the obligations of any of the parties hereto, shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions, or the obligations of the other parties hereto, shall not in any way be affected or impaired thereby, and the parties hereto shall negotiate in good faith to replace such invalid, illegal or unenforceable provisions.
d. This Consent shall be binding upon and benefit the successors and assigns of the Host, the Company and their respective successors, transferees and assigns. No termination, amendment, variation or waiver of any provisions of this Consent shall be effective
unless in writing and signed by the Host and the Company and consented to by the Financing Party.
e. Except as expressly modified by this Consent, all other terms and provisions of the Solar Project Documents are and remain in full force and effect. This Consent shall be governed by and construed in accordance with the laws of the State of New York. f. Each Solar Project Document listed in Schedule A constitutes a service contract and not a lease of property pursuant to Section 7701(e)(1) of the Internal Revenue Code, in accordance with Section 7701(e)(3) of the Internal Revenue Code. g. The Host will from time to time, upon the written request of the Financing Party, execute and deliver such further documents and do such other acts and things as the Financing Party may reasonably request in order to effectuate more fully the purposes of this Consent.
h. To the extent not prohibited by applicable law, the parties hereto hereby irrevocably waive all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Consent. i. This Consent is the entire agreement pertaining to the matters discussed herein and shall supersede all oral and written representations and negotiations and prior agreements, if any, related to the subject matter hereof. [Signatures follow on next page.]
Signature Page
IN WITNESS WHEREOF, the parties hereto by their officers thereunto duly authorized have duly executed this Consent as of the date first set forth above.
CF FFP YORBA LINDA CC LLC
By: ___________________________________
Name:_________________________________
Title:__________________________________
CITY OF YORBA LINDA
By: ___________________________________
Name:_________________________________
Title:__________________________________
Accepted: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By: ___________________________________
Name: ________________________________
Title:__________________________________
Exhibit A
Notice of SLB Transaction
[_], 202[_]
City of Yorba Linda
[Address]
Telephone: []
Email: []
Attn: []
Reference is made to that certain Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination between the City of Yorba Linda (the “Host”) and CF FFP Yorba Linda CC LLC (the “Company”) dated as of [___], 2026 (the “Consent”). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Consent.
Per the Consent, notice is hereby provided that Company (or a Provider Assignee) has entered into a Sale-Leaseback Transaction, with ___________________, which is now the SLB Lessor as defined in the Consent.
The Host hereby acknowledges and agrees that, from and after the date hereof, all references to the Financing Party shall mean and refer exclusively to the SLB Lessor (and not the Construction Lender), and any and all obligations, notices, consents, approvals, payments, and deliveries that were or are to be made to, or for the benefit of, the Construction Lender shall instead be directed to, and made for the benefit of, the SLB Lessor. The Host confirms that all representations, warranties, and confirmations made by it in the Consent remain true and correct as of the date of this Notice.
In accordance with Section 3 of the Consent, the Host is hereby instructed to pay all amounts payable by it under the Solar Project Documents into the account specified immediately below:
Bank: []
ABA Routing Number: []
Account Number: []
Account Name: []
All notices and other communications that Host is required to send to SLB Lessor under the Consent shall be directed as follows:
[]
Attn: []
CF FFP YORBA LINDA CC LLC
By: ________________________
Name:
Title:
SLB LESSOR:
[]
By: ________________________
Name:
Title:
CITY OF YORBA LINDA
Acknowledged by:
[]
By: ________________________
Name:
Title:
Schedule A
Energy Services Agreement – Solar dated September 20, 2023 as amended by that certain OMNIBUS AMENDMENT for the Community Center project located at 4501 Casa Loma Ave, Yorba Linda, CA 92886
General Terms and Conditions of Energy Services Agreement dated July 18, 2023
CONSENT TO COLLATERAL ASSIGNMENT OF SOLAR PROJECT DOCUMENTS
AND EQUIPMENT SUBORDINATION
This Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination, dated as of April_____________, 2026 (this “Consent”), is made by the City of Yorba Linda (the “Host”), and CF FFP Yorba Linda Golf Club LLC (a California limited liability company and assignee of Greenskies Clean Energy LLC) and is provided for the benefit of KeyBank National Association (the “Construction Lender”) and the sale-leaseback lessor to be identified in the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent (the “SLB Lessor”), in connection with those certain solar project documents (the “Solar Project Documents”) identified in Schedule A to this Consent, and relates to the solar photovoltaic system (the “System”) to be located at the site (the “Site”) identified in Schedule A to this Consent.
Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Solar Project Documents. The term “Financing Party,” as used in this Consent, shall refer to Construction Lender prior to the Sale Leaseback Transaction (as such term is defined herein) for a specific System, and to SLB Lessor on or after the Sale Leaseback Transaction for the specific System.
1. Acknowledgment and Consent.
a. The Host acknowledges that CF FFP Yorba Linda Golf Club LLC (the “Company”) is entering into a construction financing agreement with Construction Lender to finance the building of the System (the “Construction Financing”) and will enter into one or more sale-leaseback transactions (each a “Sale Leaseback Transaction”, collectively the “Sale Leaseback Transactions”) with SLB Lessor, whereby the Company will sell its rights, interests and obligations in and to the System to SLB Lessor, and in connection therewith SLB Lessor will lease the System to the Company (collectively, the “Transactions”). b. Host acknowledges that, as a part of the Transactions, the Company may assign the Solar Project Documents to a sister entity not long after the date hereof, and may subsequently further assign the Solar Project Documents to another sister entity in connection with the Transactions (collectively the “Provider Assignees”). c. In order to secure its obligations under the Transactions, the Company (i) is collaterally assigning and granting to Construction Lender a first-priority security interest in all of the Company’s right, title and interest in, to and under the System and the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents, in connection with the Construction Financing, and (ii) in connection with the Sale Leaseback Transactions (A) will convey the System to the SLB Lessor and (B) will collaterally assign and grant to the SLB Lessor a first-priority security interest in all of the Company’s right, title and interest in, to and under the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents.
d. To the extent consent is not already granted in the Solar Project Documents, Host consents to the transactions set forth in subparts (a) through (c) above.
2. Financing Party's Rights. Notwithstanding any contrary term in the Solar Project Documents:
a. the Financing Party shall be entitled to exercise any and all rights of secured parties generally with respect to the Solar Project Documents; b. the Host agrees that the Host will provide to the Financing Party notice of any default by the Company and other material notices under the Solar Project Documents and will permit the Financing Party the same cure periods as are available to the Company under the Solar Project Documents, provided that the Financing Party shall have an additional ninety (90) days to cure any default the Company has not cured within the cure period permitted, so long as the Financing Party is diligently proceeding to cause a cure; and further provided that any period to cause a cure shall be tolled if the Financing Party is prohibited from curing any default due to bankruptcy of the Company or by any other process, stay or injunction issued by any court or governmental authority;
c. if, in connection with the exercise of any of its rights and remedies, the Financing Party elects to exercise step-in rights under, or become party to, the Solar Project Documents, the Financing Party shall use commercially reasonable efforts to ensure that the System remains under the care of a Qualified Operator and a “Qualified Operator” is a business organization which has the skillset and experience to operate and service the System in accordance with the terms of the Solar Project Documents and the Company acknowledges and agrees that the Financing Party shall not be bound by the terms of the Solar Project Documents unless and until the Financing Party becomes a party to such Solar Project Documents; and d. if the Financing Party transfers the Company’s (or any Provider Assignee’s) interests in the Solar Project Documents to a third party (an “Assignee”), so long as the Assignee is also a Qualified Operator, (i) the Host shall recognize the respective Assignee as the counterparty under the Solar Project Documents; (ii) the Host shall continue to perform its obligations under the Solar Project Documents in favor of such Assignee; and (iii) the Financing Party shall be released from any further liability thereunder (other than those obligations arising prior to the date of such assignment or those obligations that are not assumed).
3. Payments Under Solar Project Documents. The Host shall pay all amounts payable by it under the Solar Project Documents, if any, in lawful money of the United States of America, in immediately available funds, directly into the account specified below (or, after delivery of the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent, into the account specified in such notice) or to such other person or account as may be specified from time to time by the Financing Party to the Host in writing.
Bank: KeyBank National Association
ABA Routing Number: 041001039
Account Number: 359681786224
Account Name: OBO CF Holdco KBC LLC – Controlled Account
4. Representations and Warranties of Host. The Host hereby represents and warrants to the Financing Party as follows:
a. the Host is duly organized, validly existing and in good standing under the laws of California and has all requisite power and authority to execute and deliver, and to perform its obligations under, the Solar Project Documents and this Consent; b. the execution, delivery and performance by the Host of this Consent have been duly authorized by all necessary action and, as of the date hereof, do not require any further consents or approvals that have not been obtained;
c. the execution, delivery and performance by the Host of this Consent will not (i) violate any provision of any law, regulation, order, judgment, injunction or similar matters applicable to it; or (ii) conflict with, result in a breach of or violate any of the terms, conditions or provisions of the Host’s formation, constituent or governing documents; d. this Consent and the Solar Project Documents are legal, valid and binding obligations of the Host enforceable against the Host in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general; and
e. as of the date hereof, the Host has no knowledge of a Force Majeure event having occurred under the Solar Project Documents.
5. Representations and Warranties of Company. The Company hereby represents and warrants to the Financing Party and the Host that the Company has the full power, authority and legal right to execute, deliver and perform its obligations under this Consent and the Solar Project Documents. This Consent has been duly executed and delivered by the Company, and this Consent and the Solar Project Documents are legal, valid and binding obligations of the Company enforceable against Company in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general.
6. Confirmation and Agreement. The Host confirms the following matters for the benefit of the Financing Party with respect to the Solar Project Documents and the Systems. a. As of the date hereof, the Host has not taken any official action requiring or authorizing, entered into any approval to exercise or decided whether it will exercise, in each case, any purchase option available to the Host in connection with the System, nor is the Host under any legal or economic compulsion to exercise any such purchase option. Notwithstanding anything in any Solar Project Document to the contrary, the Host hereby agrees that its exercise of any purchase option available to it with respect to the System (other than any such purchase option arising with respect to the sixth (6th), tenth (10th) or fifteenth (15th) anniversary of the Commercial Operation Date (as defined in the Solar Project Documents) or upon the end of the Initial Term (as defined in the Solar Project Documents)) is subject to the SLB Lessor’s prior written consent as owner of the System (not to be unreasonably withheld, conditioned or delayed). b. To the Host’s knowledge, there exists no default or event or condition that
would, with the giving of notice or lapse of time, constitute a default under the Solar Project Documents, and each of the Company and the Host has fulfilled all of its respective obligations under the Solar Project Documents to the extent such obligations are required to be performed as of the date hereof.
c. The Host owns the Site where the System has been or will be installed.
The Host acknowledges and agrees that the Site noted in Schedule A is correct. d. The interest of the Financing Party in the System shall at all times be superior to any interest the Host may now or hereafter have in the System, and the Host hereby subordinates any lien, encumbrance or interest heretofore or hereafter created that the Host may have in the System, whether such lien, encumbrance or interest is statutory or by agreement, to the title, lien, encumbrance or interest of the Financing Party, regardless of the timing or order of creation or any perfection, and whether or not the System (or any part thereof) is deemed a fixture on the Site. The Host agrees that the System is, and shall at all times remain, personal property notwithstanding that it may be installed on or affixed to the Site. e. Without limitation of the foregoing, the Host grants to the Financing Party and its agents, employees and contractors a license to enter upon the Site and remove the System for up to one hundred eighty (180) days after notice to Financing Party of the termination or expiration of the Solar Project Documents, with such one hundred eighty (180) day period being tolled for any period of time during which the Financing Party is stayed from removing the System by a proceeding in bankruptcy with respect to the Company. The Host agrees not to hinder such exercise of remedies under the Solar Project Documents or this Consent. If the Financing Party elects to remove the System then the Financing Party shall perform such removal in accordance with the terms of the Solar Project Documents, provided that the Financing Party shall have no obligations to remove substructures installed in order to support the System.
f. The Solar Project Documents are in full force and effect and have not been amended except as explicitly indicated in Schedule A, and there are no other agreements or representations of any kind between the Host and the Company other than the Solar Project Documents listed in Schedule A.
g. The Host will use commercially reasonable efforts to place its direct successors, assigns and lien holders on notice of the ownership of the System by the Financing Party, the existence of Financing Party’s security interest in the Solar Project Documents, and the fact that the System is not part of the Site or fixtures thereof, as necessary and appropriate to avoid confusion or adverse claims.
h. The Host acknowledges that, under the Transaction, the Company is not permitted to agree to an amendment or assignment of the Solar Project Documents without the prior written consent of the Financing Party, which shall not be unreasonably withheld, conditioned, or delayed.
i. There is no mortgage, financing statement, fixture filing, lien, or other encumbrance (a “Lien”) attached to the Site described in the Solar Project Documents.
Notwithstanding the foregoing, if the Company or the Financing Party discovers a Lien on the Site that could reasonably be construed as prospectively attaching to the System, the Host will secure, or otherwise cooperate with the Company and the Financing Party to secure, any nondisturbance agreement, lien waiver, disclaimer, or other documentation (“Waiver Documentation”) determined by the Financing Party as necessary and appropriate to avoid confusion or adverse claims.
j. There is no easement, license, restrictive covenant, or other such real estate interest (“Site Interest”), whether possessory or non-possessory, that will adversely affect the Company’s ability to develop, construct, operate, maintain, and decommission the System in accordance with the Solar Project Documents. Notwithstanding the foregoing, if the Company or the Financing Party discovers a Site Interest on the Sites that could reasonably be construed as prospectively adversely affecting the Company’s ability to comply with the Solar Project Documents, the Host will secure or otherwise cooperate with the Company and the Financing Party to secure any Waiver Documentation determined by Financing Party as necessary and appropriate to permit full compliance with the Solar Project Documents. k. The Host confirms that it intends to fulfill its obligations under the Solar Project Documents, including ensuring that sufficient monies are appropriated in accordance with applicable law.
l. The Host and the Company confirm as of the date hereof, no liquidated damages or other such payments are due and owing.
7. General.
a. Unless otherwise expressly specified or permitted by the terms hereof, all communications and notices provided for herein shall be in writing, and any such communication or notice shall become effective (i) upon personal delivery thereof, including, without limitation, by overnight mail or courier service; (ii) in the case of notice by United States mail, certified or registered, postage prepaid, return receipt requested, upon receipt thereof; or (iii) in the case of notice by email, upon confirmation of receipt thereof in writing by the intended recipient, and provided such email transmission is promptly further confirmed by any of the methods set forth in clauses (i) or (ii) above, in each case addressed to each party hereto at its address set forth below or, in the case of any such party hereto, at such other address as such party may from time to time designate by written notice to the other parties hereto:
If to the Host: As noted in the Solar Project
Documents
If to Financing Party:
Construction Lender
KeyBank National Association
127 Public Square
Cleveland, OH 44114-1306
Attn: E. Clare Morter
Tel: (216) 471-4982
E-mail: [email protected]
E-mail:
[email protected]
with a copy to:
KeyBank National Association
4900 Tiedeman Road
Cleveland, OH 44114
Mail Code: OH-01-51-0575
Attn: Key Agency Services
Tel: (216) 813-1950
Email: [email protected]
SLB Lessor
As set forth in the “Notice of SLB Transaction” in
the form attached as Exhibit A to this Consent.
If to Company:
CF Holdco KBC LLC
c/o GREENSKIES CLEAN ENERGY LLC
127 Washington Avenue
West Building, Lower Level
North Haven, CT 06473
Attn: General Counsel
With a copy to: [email protected]
b. This Consent may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Consent by facsimile or e-mail (including “pdf” format) or other electronic means shall be effective as delivery of an original executed counterpart of this Consent.
c. In case any provision of this Consent, or the obligations of any of the parties hereto, shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions, or the obligations of the other parties hereto, shall not in any way be affected or impaired thereby, and the parties hereto shall negotiate in good faith to replace such invalid, illegal or unenforceable provisions.
d. This Consent shall be binding upon and benefit the successors and assigns of the Host, the Company and their respective successors, transferees and assigns. No termination, amendment, variation or waiver of any provisions of this Consent shall be effective
unless in writing and signed by the Host and the Company and consented to by the Financing Party.
e. Except as expressly modified by this Consent, all other terms and provisions of the Solar Project Documents are and remain in full force and effect. This Consent shall be governed by and construed in accordance with the laws of the State of New York. f. Each Solar Project Document listed in Schedule A constitutes a service contract and not a lease of property pursuant to Section 7701(e)(1) of the Internal Revenue Code, in accordance with Section 7701(e)(3) of the Internal Revenue Code. g. The Host will from time to time, upon the written request of the Financing Party, execute and deliver such further documents and do such other acts and things as the Financing Party may reasonably request in order to effectuate more fully the purposes of this Consent.
h. To the extent not prohibited by applicable law, the parties hereto hereby irrevocably waive all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Consent. i. This Consent is the entire agreement pertaining to the matters discussed herein and shall supersede all oral and written representations and negotiations and prior agreements, if any, related to the subject matter hereof. [Signatures follow on next page.]
Signature Page
IN WITNESS WHEREOF, the parties hereto by their officers thereunto duly authorized have duly executed this Consent as of the date first set forth above.
CF FFP YORBA LINDA GOLF CLUB LLC
By: ___________________________________
Name:_________________________________
Title:__________________________________
CITY OF YORBA LINDA
By: ___________________________________
Name:_________________________________
Title:__________________________________
Accepted: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By: ___________________________________
Name: ________________________________
Title:__________________________________
Exhibit A
Notice of SLB Transaction
[_], 202[_]
City of Yorba Linda
[Address]
Telephone: []
Email: []
Attn: []
Reference is made to that certain Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination between the City of Yorba Linda (the “Host”) and CF FFP Yorba Linda Golf Club LLC (the “Company”) dated as of [___], 2026 (the “Consent”). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Consent. Per the Consent, notice is hereby provided that Company (or a Provider Assignee) has entered into a Sale-Leaseback Transaction, with ___________________, which is now the SLB Lessor as defined in the Consent.
The Host hereby acknowledges and agrees that, from and after the date hereof, all references to the Financing Party shall mean and refer exclusively to the SLB Lessor (and not the Construction Lender), and any and all obligations, notices, consents, approvals, payments, and deliveries that were or are to be made to, or for the benefit of, the Construction Lender shall instead be directed to, and made for the benefit of, the SLB Lessor. The Host confirms that all representations, warranties, and confirmations made by it in the Consent remain true and correct as of the date of this Notice.
In accordance with Section 3 of the Consent, the Host is hereby instructed to pay all amounts payable by it under the Solar Project Documents into the account specified immediately below:
Bank: []
ABA Routing Number: []
Account Number: []
Account Name: []
All notices and other communications that Host is required to send to SLB Lessor under the Consent shall be directed as follows:
[]
Attn: []
CF FFP YORBA LINDA GOLF CLUB LLC
By: ________________________
Name:
Title:
SLB LESSOR:
[]
By: ________________________
Name:
Title:
CITY OF YORBA LINDA
Acknowledged by:
[]
By: ________________________
Name:
Title:
Schedule A
Energy Services Agreement – Solar dated September 20, 2023 as amended by that certain OMNIBUS AMENDMENT for the Black Gold project located at 1 Black Gold Drive, Yorba Linda, CA 92886, as amended by that Upgrades, Scope and/or Schedule Change Acknowledgment dated October 22, 2024
General Terms and Conditions of Energy Services Agreement dated July 18, 2023
CONSENT TO COLLATERAL ASSIGNMENT OF SOLAR PROJECT DOCUMENTS
AND EQUIPMENT SUBORDINATION
This Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination, dated as of April_____________, 2026 (this “Consent”), is made by the City of Yorba Linda (the “Host”), and CF FFP Yorba Linda Library LLC (a California limited liability company and assignee of Greenskies Clean Energy LLC) and is provided for the benefit of KeyBank National Association (the “Construction Lender”) and the sale-leaseback lessor to be identified in the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent (the “SLB Lessor”), in connection with those certain solar project documents (the “Solar Project Documents”) identified in Schedule A to this Consent, and relates to the solar photovoltaic system (the “System”) to be located at the site (the “Site”) identified in Schedule A to this Consent.
Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Solar Project Documents. The term “Financing Party,” as used in this Consent, shall refer to Construction Lender prior to the Sale Leaseback Transaction (as such term is defined herein) for a specific System, and to SLB Lessor on or after the Sale Leaseback Transaction for the specific System.
1. Acknowledgment and Consent.
a. The Host acknowledges that CF FFP Yorba Linda Library LLC (the “Company”) is entering into a construction financing agreement with Construction Lender to finance the building of the System (the “Construction Financing”) and will enter into one or more sale-leaseback transactions (each a “Sale Leaseback Transaction”, collectively the “Sale Leaseback Transactions”) with SLB Lessor, whereby the Company will sell its rights, interests and obligations in and to the System to SLB Lessor, and in connection therewith SLB Lessor will lease the System to the Company (collectively, the “Transactions”). b. Host acknowledges that, as a part of the Transactions, the Company may assign the Solar Project Documents to a sister entity not long after the date hereof, and may subsequently further assign the Solar Project Documents to another sister entity in connection with the Transactions (collectively the “Provider Assignees”). c. In order to secure its obligations under the Transactions, the Company (i) is collaterally assigning and granting to Construction Lender a first-priority security interest in all of the Company’s right, title and interest in, to and under the System and the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents, in connection with the Construction Financing, and (ii) in connection with the Sale Leaseback Transactions (A) will convey the System to the SLB Lessor and (B) will collaterally assign and grant to the SLB Lessor a first-priority security interest in all of the Company’s right, title and interest in, to and under the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents.
d. To the extent consent is not already granted in the Solar Project Documents, Host consents to the transactions set forth in subparts (a) through (c) above.
2. Financing Party's Rights. Notwithstanding any contrary term in the Solar Project Documents:
a. the Financing Party shall be entitled to exercise any and all rights of secured parties generally with respect to the Solar Project Documents; b. the Host agrees that the Host will provide to the Financing Party notice of any default by the Company and other material notices under the Solar Project Documents and will permit the Financing Party the same cure periods as are available to the Company under the Solar Project Documents, provided that the Financing Party shall have an additional ninety (90) days to cure any default the Company has not cured within the cure period permitted, so long as the Financing Party is diligently proceeding to cause a cure; and further provided that any period to cause a cure shall be tolled if the Financing Party is prohibited from curing any default due to bankruptcy of the Company or by any other process, stay or injunction issued by any court or governmental authority;
c. if, in connection with the exercise of any of its rights and remedies, the Financing Party elects to exercise step-in rights under, or become party to, the Solar Project Documents, the Financing Party shall use commercially reasonable efforts to ensure that the System remains under the care of a Qualified Operator and a “Qualified Operator” is a business organization which has the skillset and experience to operate and service the System in accordance with the terms of the Solar Project Documents and the Company acknowledges and agrees that the Financing Party shall not be bound by the terms of the Solar Project Documents unless and until the Financing Party becomes a party to such Solar Project Documents; and d. if the Financing Party transfers the Company’s (or any Provider Assignee’s) interests in the Solar Project Documents to a third party (an “Assignee”), so long as the Assignee is also a Qualified Operator, (i) the Host shall recognize the respective Assignee as the counterparty under the Solar Project Documents; (ii) the Host shall continue to perform its obligations under the Solar Project Documents in favor of such Assignee; and (iii) the Financing Party shall be released from any further liability thereunder (other than those obligations arising prior to the date of such assignment or those obligations that are not assumed).
3. Payments Under Solar Project Documents. The Host shall pay all amounts payable by it under the Solar Project Documents, if any, in lawful money of the United States of America, in immediately available funds, directly into the account specified below (or, after delivery of the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent, into the account specified in such notice) or to such other person or account as may be specified from time to time by the Financing Party to the Host in writing.
Bank: KeyBank National Association
ABA Routing Number: 041001039
Account Number: 359681786224
Account Name: OBO CF Holdco KBC LLC – Controlled Account
4. Representations and Warranties of Host. The Host hereby represents and warrants to the Financing Party as follows:
a. the Host is duly organized, validly existing and in good standing under the laws of the State of California and has all requisite power and authority to execute and deliver, and to perform its obligations under, the Solar Project Documents and this Consent; b. the execution, delivery and performance by the Host of this Consent have been duly authorized by all necessary action and, as of the date hereof, do not require any further consents or approvals that have not been obtained;
c. the execution, delivery and performance by the Host of this Consent will not (i) violate any provision of any law, regulation, order, judgment, injunction or similar matters applicable to it; or (ii) conflict with, result in a breach of or violate any of the terms, conditions or provisions of the Host’s formation, constituent or governing documents; d. this Consent and the Solar Project Documents are legal, valid and binding obligations of the Host enforceable against the Host in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general; and
e. as of the date hereof, the Host has no knowledge of a Force Majeure event having occurred under the Solar Project Documents.
5. Representations and Warranties of Company. The Company hereby represents and warrants to the Financing Party and the Host that the Company has the full power, authority and legal right to execute, deliver and perform its obligations under this Consent and the Solar Project Documents. This Consent has been duly executed and delivered by the Company, and this Consent and the Solar Project Documents are legal, valid and binding obligations of the Company enforceable against Company in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general.
6. Confirmation and Agreement. The Host confirms the following matters for the benefit of the Financing Party with respect to the Solar Project Documents and the Systems. a. As of the date hereof, the Host has not taken any official action requiring or authorizing, entered into any approval to exercise or decided whether it will exercise, in each case, any purchase option available to the Host in connection with the System, nor is the Host under any legal or economic compulsion to exercise any such purchase option. Notwithstanding anything in any Solar Project Document to the contrary, the Host hereby agrees that its exercise of any purchase option available to it with respect to the System (other than any such purchase option arising with respect to the sixth (6th), tenth (10th) or fifteenth (15th) anniversary of the Commercial Operation Date (as defined in the Solar Project Documents) or upon the end of the Initial Term (as defined in the Solar Project Documents)) is subject to the SLB Lessor’s prior written consent as owner of the System (not to be unreasonably withheld, conditioned or delayed). b. To the Host’s knowledge, there exists no default or event or condition that
would, with the giving of notice or lapse of time, constitute a default under the Solar Project Documents, and each of the Company and the Host has fulfilled all of its respective obligations under the Solar Project Documents to the extent such obligations are required to be performed as of the date hereof.
c. The Host owns the Site where the System has been or will be installed.
The Host acknowledges and agrees that the Site noted in Schedule A is correct. d. The interest of the Financing Party in the System shall at all times be superior to any interest the Host may now or hereafter have in the System, and the Host hereby subordinates any lien, encumbrance or interest heretofore or hereafter created that the Host may have in the System, whether such lien, encumbrance or interest is statutory or by agreement, to the title, lien, encumbrance or interest of the Financing Party, regardless of the timing or order of creation or any perfection, and whether or not the System (or any part thereof) is deemed a fixture on the Site. The Host agrees that the System is, and shall at all times remain, personal property notwithstanding that it may be installed on or affixed to the Site. e. Without limitation of the foregoing, the Host grants to the Financing Party and its agents, employees and contractors a license to enter upon the Site and remove the System for up to one hundred eighty (180) days after notice to Financing Party of the termination or expiration of the Solar Project Documents, with such one hundred eighty (180) day period being tolled for any period of time during which the Financing Party is stayed from removing the System by a proceeding in bankruptcy with respect to the Company. The Host agrees not to hinder such exercise of remedies under the Solar Project Documents or this Consent. If the Financing Party elects to remove the System then the Financing Party shall perform such removal in accordance with the terms of the Solar Project Documents, provided that the Financing Party shall have no obligations to remove substructures installed in order to support the System.
f. The Solar Project Documents are in full force and effect and have not been amended except as explicitly indicated in Schedule A, and there are no other agreements or representations of any kind between the Host and the Company other than the Solar Project Documents listed in Schedule A.
g. The Host will use commercially reasonable efforts to place its direct successors, assigns and lien holders on notice of the ownership of the System by the Financing Party, the existence of Financing Party’s security interest in the Solar Project Documents, and the fact that the System is not part of the Site or fixtures thereof, as necessary and appropriate to avoid confusion or adverse claims.
h. The Host acknowledges that, under the Transaction, the Company is not permitted to agree to an amendment or assignment of the Solar Project Documents without the prior written consent of the Financing Party, which shall not be unreasonably withheld, conditioned, or delayed.
i. There is no mortgage, financing statement, fixture filing, lien, or other encumbrance (a “Lien”) attached to the Site described in the Solar Project Documents.
Notwithstanding the foregoing, if the Company or the Financing Party discovers a Lien on the Site that could reasonably be construed as prospectively attaching to the System, the Host will secure, or otherwise cooperate with the Company and the Financing Party to secure, any nondisturbance agreement, lien waiver, disclaimer, or other documentation (“Waiver Documentation”) determined by the Financing Party as necessary and appropriate to avoid confusion or adverse claims.
j. There is no easement, license, restrictive covenant, or other such real estate interest (“Site Interest”), whether possessory or non-possessory, that will adversely affect the Company’s ability to develop, construct, operate, maintain, and decommission the System in accordance with the Solar Project Documents. Notwithstanding the foregoing, if the Company or the Financing Party discovers a Site Interest on the Sites that could reasonably be construed as prospectively adversely affecting the Company’s ability to comply with the Solar Project Documents, the Host will secure or otherwise cooperate with the Company and the Financing Party to secure any Waiver Documentation determined by Financing Party as necessary and appropriate to permit full compliance with the Solar Project Documents. k. The Host confirms that it intends to fulfill its obligations under the Solar Project Documents, including ensuring that sufficient monies are appropriated in accordance with applicable law.
l. The Host and the Company confirm as of the date hereof, no liquidated damages or other such payments are due and owing.
7. General.
a. Unless otherwise expressly specified or permitted by the terms hereof, all communications and notices provided for herein shall be in writing, and any such communication or notice shall become effective (i) upon personal delivery thereof, including, without limitation, by overnight mail or courier service; (ii) in the case of notice by United States mail, certified or registered, postage prepaid, return receipt requested, upon receipt thereof; or (iii) in the case of notice by email, upon confirmation of receipt thereof in writing by the intended recipient, and provided such email transmission is promptly further confirmed by any of the methods set forth in clauses (i) or (ii) above, in each case addressed to each party hereto at its address set forth below or, in the case of any such party hereto, at such other address as such party may from time to time designate by written notice to the other parties hereto:
If to the Host: As noted in the Solar Project
Documents
If to Financing Party:
Construction Lender
KeyBank National Association
127 Public Square
Cleveland, OH 44114-1306
Attn: E. Clare Morter
Tel: (216) 471-4982
E-mail: [email protected]
E-mail:
[email protected]
with a copy to:
KeyBank National Association
4900 Tiedeman Road
Cleveland, OH 44114
Mail Code: OH-01-51-0575
Attn: Key Agency Services
Tel: (216) 813-1950
Email: [email protected]
SLB Lessor
As set forth in the “Notice of SLB Transaction” in
the form attached as Exhibit A to this Consent.
If to Company:
CF Holdco KBC LLC
c/o GREENSKIES CLEAN ENERGY LLC
127 Washington Avenue
West Building, Lower Level
North Haven, CT 06473
Attn: General Counsel
With a copy to: [email protected]
b. This Consent may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Consent by facsimile or e-mail (including “pdf” format) or other electronic means shall be effective as delivery of an original executed counterpart of this Consent.
c. In case any provision of this Consent, or the obligations of any of the parties hereto, shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions, or the obligations of the other parties hereto, shall not in any way be affected or impaired thereby, and the parties hereto shall negotiate in good faith to replace such invalid, illegal or unenforceable provisions.
d. This Consent shall be binding upon and benefit the successors and assigns of the Host, the Company and their respective successors, transferees and assigns. No termination, amendment, variation or waiver of any provisions of this Consent shall be effective
unless in writing and signed by the Host and the Company and consented to by the Financing Party.
e. Except as expressly modified by this Consent, all other terms and provisions of the Solar Project Documents are and remain in full force and effect. This Consent shall be governed by and construed in accordance with the laws of the State of New York. f. Each Solar Project Document listed in Schedule A constitutes a service contract and not a lease of property pursuant to Section 7701(e)(1) of the Internal Revenue Code, in accordance with Section 7701(e)(3) of the Internal Revenue Code. g. The Host will from time to time, upon the written request of the Financing Party, execute and deliver such further documents and do such other acts and things as the Financing Party may reasonably request in order to effectuate more fully the purposes of this Consent.
h. To the extent not prohibited by applicable law, the parties hereto hereby irrevocably waive all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Consent. i. This Consent is the entire agreement pertaining to the matters discussed herein and shall supersede all oral and written representations and negotiations and prior agreements, if any, related to the subject matter hereof. [Signatures follow on next page.]
Signature Page
IN WITNESS WHEREOF, the parties hereto by their officers thereunto duly authorized have duly executed this Consent as of the date first set forth above.
CF FFP YORBA LINDA LIBRARY LLC
By: ___________________________________
Name:_________________________________
Title:__________________________________
CITY OF YORBA LINDA
By: ___________________________________
Name:_________________________________
Title:__________________________________
Accepted: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By: ___________________________________
Name: ________________________________
Title:__________________________________
Exhibit A
Notice of SLB Transaction
[_], 202[_]
City of Yorba Linda
[Address]
Telephone: []
Email: []
Attn: []
Reference is made to that certain Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination between the City of Yorba Linda (the “Host”) and CF FFP Yorba Linda Library LLC (the “Company”) dated as of [___], 2026 (the “Consent”). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Consent.
Per the Consent, notice is hereby provided that Company (or a Provider Assignee) has entered into a Sale-Leaseback Transaction, with ___________________, which is now the SLB Lessor as defined in the Consent.
The Host hereby acknowledges and agrees that, from and after the date hereof, all references to the Financing Party shall mean and refer exclusively to the SLB Lessor (and not the Construction Lender), and any and all obligations, notices, consents, approvals, payments, and deliveries that were or are to be made to, or for the benefit of, the Construction Lender shall instead be directed to, and made for the benefit of, the SLB Lessor. The Host confirms that all representations, warranties, and confirmations made by it in the Consent remain true and correct as of the date of this Notice.
In accordance with Section 3 of the Consent, the Host is hereby instructed to pay all amounts payable by it under the Solar Project Documents into the account specified immediately below:
Bank: []
ABA Routing Number: []
Account Number: []
Account Name: []
All notices and other communications that Host is required to send to SLB Lessor under the Consent shall be directed as follows:
[]
Attn: []
CF FFP YORBA LINDA LIBRARY LLC
By: ________________________
Name:
Title:
SLB LESSOR:
[]
By: ________________________
Name:
Title:
CITY OF YORBA LINDA
Acknowledged by:
[]
By: ________________________
Name:
Title:
Schedule A
Energy Services Agreement – Solar dated September 20, 2023 as amended by that certain OMNIBUS AMENDMENT for the Library project located at 4852 Lakeview Ave., Yorba Linda, CA 92886
General Terms and Conditions of Energy Services Agreement dated July 18, 2023
CONSENT TO COLLATERAL ASSIGNMENT OF SOLAR PROJECT DOCUMENTS
AND EQUIPMENT SUBORDINATION
This Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination, dated as of April_____________, 2026 (this “Consent”), is made by the City of Yorba Linda (the “Host”), and CF FFP Yorba Linda CC LLC (a California limited liability company and assignee of Greenskies Clean Energy LLC) and is provided for the benefit of KeyBank National Association (the “Construction Lender”) and the sale-leaseback lessor to be identified in the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent (the “SLB Lessor”), in connection with those certain solar project documents (the “Solar Project Documents”) identified in Schedule A to this Consent, and relates to the solar photovoltaic system (the “System”) to be located at the site (the “Site”) identified in Schedule A to this Consent.
Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Solar Project Documents. The term “Financing Party,” as used in this Consent, shall refer to Construction Lender prior to the Sale Leaseback Transaction (as such term is defined herein) for a specific System, and to SLB Lessor on or after the Sale Leaseback Transaction for the specific System.
1. Acknowledgment and Consent.
a. The Host acknowledges that CF FFP Yorba Linda CC LLC (the “Company”) is entering into a construction financing agreement with Construction Lender to finance the building of the System (the “Construction Financing”) and will enter into one or more sale-leaseback transactions (each a “Sale Leaseback Transaction”, collectively the “Sale Leaseback Transactions”) with SLB Lessor, whereby the Company will sell its rights, interests and obligations in and to the System to SLB Lessor, and in connection therewith SLB Lessor will lease the System to the Company (collectively, the “Transactions”). b. Host acknowledges that, as a part of the Transactions, the Company may assign the Solar Project Documents to a sister entity not long after the date hereof, and may subsequently further assign the Solar Project Documents to another sister entity in connection with the Transactions (collectively the “Provider Assignees”). c. In order to secure its obligations under the Transactions, the Company (i) is collaterally assigning and granting to Construction Lender a first-priority security interest in all of the Company’s right, title and interest in, to and under the System and the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents, in connection with the Construction Financing, and (ii) in connection with the Sale Leaseback Transactions (A) will convey the System to the SLB Lessor and (B) will collaterally assign and grant to the SLB Lessor a first-priority security interest in all of the Company’s right, title and interest in, to and under the Solar Project Documents including, without limitation, all of the Company’s rights to receive payments under or with respect to the Solar Project Documents.
d. To the extent consent is not already granted in the Solar Project Documents, Host consents to the transactions set forth in subparts (a) through (c) above.
2. Financing Party's Rights. Notwithstanding any contrary term in the Solar Project Documents:
a. the Financing Party shall be entitled to exercise any and all rights of secured parties generally with respect to the Solar Project Documents; b. the Host agrees that the Host will provide to the Financing Party notice of any default by the Company and other material notices under the Solar Project Documents and will permit the Financing Party the same cure periods as are available to the Company under the Solar Project Documents, provided that the Financing Party shall have an additional ninety (90) days to cure any default the Company has not cured within the cure period permitted, so long as the Financing Party is diligently proceeding to cause a cure; and further provided that any period to cause a cure shall be tolled if the Financing Party is prohibited from curing any default due to bankruptcy of the Company or by any other process, stay or injunction issued by any court or governmental authority;
c. if, in connection with the exercise of any of its rights and remedies, the Financing Party elects to exercise step-in rights under, or become party to, the Solar Project Documents, the Financing Party shall use commercially reasonable efforts to ensure that the System remains under the care of a Qualified Operator and a “Qualified Operator” is a business organization which has the skillset and experience to operate and service the System in accordance with the terms of the Solar Project Documents and the Company acknowledges and agrees that the Financing Party shall not be bound by the terms of the Solar Project Documents unless and until the Financing Party becomes a party to such Solar Project Documents; and d. if the Financing Party transfers the Company’s (or any Provider Assignee’s) interests in the Solar Project Documents to a third party (an “Assignee”), so long as the Assignee is also a Qualified Operator, (i) the Host shall recognize the respective Assignee as the counterparty under the Solar Project Documents; (ii) the Host shall continue to perform its obligations under the Solar Project Documents in favor of such Assignee; and (iii) the Financing Party shall be released from any further liability thereunder (other than those obligations arising prior to the date of such assignment or those obligations that are not assumed).
3. Payments Under Solar Project Documents. The Host shall pay all amounts payable by it under the Solar Project Documents, if any, in lawful money of the United States of America, in immediately available funds, directly into the account specified below (or, after delivery of the “Notice of SLB Transaction” in the form attached as Exhibit A to this Consent, into the account specified in such notice) or to such other person or account as may be specified from time to time by the Financing Party to the Host in writing.
Bank: KeyBank National Association
ABA Routing Number: 041001039
Account Number: 359681786224
Account Name: OBO CF Holdco KBC LLC – Controlled Account
4. Representations and Warranties of Host. The Host hereby represents and warrants to the Financing Party as follows:
a. the Host is duly organized, validly existing and in good standing under the laws of California and has all requisite power and authority to execute and deliver, and to perform its obligations under, the Solar Project Documents and this Consent; b. the execution, delivery and performance by the Host of this Consent have been duly authorized by all necessary action and, as of the date hereof, do not require any further consents or approvals that have not been obtained;
c. the execution, delivery and performance by the Host of this Consent will not (i) violate any provision of any law, regulation, order, judgment, injunction or similar matters applicable to it; or (ii) conflict with, result in a breach of or violate any of the terms, conditions or provisions of the Host’s formation, constituent or governing documents; d. this Consent and the Solar Project Documents are legal, valid and binding obligations of the Host enforceable against the Host in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general; and
e. as of the date hereof, the Host has no knowledge of a Force Majeure event having occurred under the Solar Project Documents.
5. Representations and Warranties of Company. The Company hereby represents and warrants to the Financing Party and the Host that the Company has the full power, authority and legal right to execute, deliver and perform its obligations under this Consent and the Solar Project Documents. This Consent has been duly executed and delivered by the Company, and this Consent and the Solar Project Documents are legal, valid and binding obligations of the Company enforceable against Company in accordance with their respective terms except as may be limited by bankruptcy, insolvency and other laws affecting creditors’ rights in general.
6. Confirmation and Agreement. The Host confirms the following matters for the benefit of the Financing Party with respect to the Solar Project Documents and the Systems. a. As of the date hereof, the Host has not taken any official action requiring or authorizing, entered into any approval to exercise or decided whether it will exercise, in each case, any purchase option available to the Host in connection with the System, nor is the Host under any legal or economic compulsion to exercise any such purchase option. Notwithstanding anything in any Solar Project Document to the contrary, the Host hereby agrees that its exercise of any purchase option available to it with respect to the System (other than any such purchase option arising with respect to the sixth (6th), tenth (10th) or fifteenth (15th) anniversary of the Commercial Operation Date (as defined in the Solar Project Documents) or upon the end of the Initial Term (as defined in the Solar Project Documents)) is subject to the SLB Lessor’s prior written consent as owner of the System (not to be unreasonably withheld, conditioned or delayed). a. Notwithstanding anything in any Solar Project Document to the contrary,
the Host hereby agrees that its exercise of any purchase option available to it with respect to the System is subject to the SLB Lessor’s prior written consent as owner of the System (not to be unreasonably withheld, conditioned or delayed and such consent not to be withheld if the request is consistent with the provisions of the Solar Project Document). b. To the Host’s knowledge, there exists no default or event or condition that would, with the giving of notice or lapse of time, constitute a default under the Solar Project Documents, and each of the Company and the Host has fulfilled all of its respective obligations under the Solar Project Documents to the extent such obligations are required to be performed as of the date hereof.
c. The Host owns the Site where the System has been or will be installed.
The Host acknowledges and agrees that the Site noted in Schedule A is correct. d. The interest of the Financing Party in the System shall at all times be superior to any interest the Host may now or hereafter have in the System, and the Host hereby subordinates any lien, encumbrance or interest heretofore or hereafter created that the Host may have in the System, whether such lien, encumbrance or interest is statutory or by agreement, to the title, lien, encumbrance or interest of the Financing Party, regardless of the timing or order of creation or any perfection, and whether or not the System (or any part thereof) is deemed a fixture on the Site. The Host agrees that the System is, and shall at all times remain, personal property notwithstanding that it may be installed on or affixed to the Site. e. Without limitation of the foregoing, the Host grants to the Financing Party and its agents, employees and contractors a license to enter upon the Site and remove the System for up to one hundred eighty (180) days after notice to Financing Party of the termination or expiration of the Solar Project Documents, with such one hundred eighty (180) day period being tolled for any period of time during which the Financing Party is stayed from removing the System by a proceeding in bankruptcy with respect to the Company. The Host agrees not to hinder such exercise of remedies under the Solar Project Documents or this Consent. If the Financing Party elects to remove the System then the Financing Party shall perform such removal in accordance with the terms of the Solar Project Documents, provided that the Financing Party shall have no obligations to remove substructures installed in order to support the System.
f. The Solar Project Documents are in full force and effect and have not been amended except as explicitly indicated in Schedule A, and there are no other agreements or representations of any kind between the Host and the Company other than the Solar Project Documents listed in Schedule A.
g. The Host will use commercially reasonable efforts to place its direct successors, assigns and lien holders on notice of the ownership of the System by the Financing Party, the existence of Financing Party’s security interest in the Solar Project Documents, and the fact that the System is not part of the Site or fixtures thereof, as necessary and appropriate to avoid confusion or adverse claims.
h. The Host acknowledges that, under the Transaction, the Company is not
permitted to agree to an amendment or assignment of the Solar Project Documents without the prior written consent of the Financing Party, which shall not be unreasonably withheld, conditioned, or delayed.
i. There is no mortgage, financing statement, fixture filing, lien, or other encumbrance (a “Lien”) attached to the Site described in the Solar Project Documents.
Notwithstanding the foregoing, if the Company or the Financing Party discovers a Lien on the Site that could reasonably be construed as prospectively attaching to the System, the Host will secure, or otherwise cooperate with the Company and the Financing Party to secure, any nondisturbance agreement, lien waiver, disclaimer, or other documentation (“Waiver Documentation”) determined by the Financing Party as necessary and appropriate to avoid confusion or adverse claims.
j. There is no easement, license, restrictive covenant, or other such real estate interest (“Site Interest”), whether possessory or non-possessory, that will adversely affect the Company’s ability to develop, construct, operate, maintain, and decommission the System in accordance with the Solar Project Documents. Notwithstanding the foregoing, if the Company or the Financing Party discovers a Site Interest on the Sites that could reasonably be construed as prospectively adversely affecting the Company’s ability to comply with the Solar Project Documents, the Host will secure or otherwise cooperate with the Company and the Financing Party to secure any Waiver Documentation determined by Financing Party as necessary and appropriate to permit full compliance with the Solar Project Documents. k. The Host confirms that it intends to fulfill its obligations under the Solar Project Documents, including ensuring that sufficient monies are appropriated in accordance with applicable law.
l. The Host and the Company confirm as of the date hereof, no liquidated damages or other such payments are due and owing.
7. General.
a. Unless otherwise expressly specified or permitted by the terms hereof, all communications and notices provided for herein shall be in writing, and any such communication or notice shall become effective (i) upon personal delivery thereof, including, without limitation, by overnight mail or courier service; (ii) in the case of notice by United States mail, certified or registered, postage prepaid, return receipt requested, upon receipt thereof; or (iii) in the case of notice by email, upon confirmation of receipt thereof in writing by the intended recipient, and provided such email transmission is promptly further confirmed by any of the methods set forth in clauses (i) or (ii) above, in each case addressed to each party hereto at its address set forth below or, in the case of any such party hereto, at such other address as such party may from time to time designate by written notice to the other parties hereto:
If to the Host: please fill inAs noted in the Solar
Project Documents
If to Financing Party:
Construction Lender
KeyBank National Association
127 Public Square
Cleveland, OH 44114-1306
Attn: E. Clare Morter
Tel: (216) 471-4982
E-mail: [email protected]
E-mail:
[email protected]
with a copy to:
KeyBank National Association
4900 Tiedeman Road
Cleveland, OH 44114
Mail Code: OH-01-51-0575
Attn: Key Agency Services
Tel: (216) 813-1950
Email: [email protected]
SLB Lessor
As set forth in the “Notice of SLB Transaction” in
the form attached as Exhibit A to this Consent.
If to Company:
CF Holdco KBC LLC
c/o GREENSKIES CLEAN ENERGY LLC
127 Washington Avenue
West Building, Lower Level
North Haven, CT 06473
Attn: General Counsel
With a copy to: [email protected]
b. This Consent may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Consent by facsimile or e-mail (including “pdf” format) or other electronic means shall be effective as delivery of an original executed counterpart of this Consent.
c. In case any provision of this Consent, or the obligations of any of the parties hereto, shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions, or the obligations of the other parties hereto, shall not in any way be
affected or impaired thereby, and the parties hereto shall negotiate in good faith to replace such invalid, illegal or unenforceable provisions.
d. This Consent shall be binding upon and benefit the successors and assigns of the Host, the Company and their respective successors, transferees and assigns. No termination, amendment, variation or waiver of any provisions of this Consent shall be effective unless in writing and signed by the Host and the Company and consented to by the Financing Party.
e. Except as expressly modified by this Consent, all other terms and provisions of the Solar Project Documents are and remain in full force and effect. This Consent shall be governed by and construed in accordance with the laws of the State of New York. f. Each Solar Project Document listed in Schedule A constitutes a service contract and not a lease of property pursuant to Section 7701(e)(1) of the Internal Revenue Code, in accordance with Section 7701(e)(3) of the Internal Revenue Code. g. The Host will from time to time, upon the written request of the Financing Party, execute and deliver such further documents and do such other acts and things as the Financing Party may reasonably request in order to effectuate more fully the purposes of this Consent.
h. To the extent not prohibited by applicable law, the parties hereto hereby irrevocably waive all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Consent. i. This Consent is the entire agreement pertaining to the matters discussed herein and shall supersede all oral and written representations and negotiations and prior agreements, if any, related to the subject matter hereof. [Signatures follow on next page.]
Signature Page
IN WITNESS WHEREOF, the parties hereto by their officers thereunto duly authorized have duly executed this Consent as of the date first set forth above.
CF FFP YORBA LINDA CC LLC
By: ___________________________________
Name:_________________________________
Title:__________________________________
CITY OF YORBA LINDA
By: ___________________________________
Name:_________________________________
Title:__________________________________
Accepted: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By: ___________________________________
Name: ________________________________
Title:__________________________________
Exhibit A
Notice of SLB Transaction
[_], 202[_]
City of Yorba Linda
[Address]please fill in
Telephone: []
Email: []
Attn: []
Reference is made to that certain Consent to Collateral Assignment of Solar Project Documents and Equipment Subordination between the City of Yorba Linda (the “Host”) and CF FFP Yorba Linda CC LLC (the “Company”) dated as of [___], 2026 (the “Consent”). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed thereto in the Consent.
Per the Consent, notice is hereby provided that Company (or a Provider Assignee) has entered into a Sale-Leaseback Transaction, with ___________________, which is now the SLB Lessor as defined in the Consent.
The Host hereby acknowledges and agrees that, from and after the date hereof, all references to the Financing Party shall mean and refer exclusively to the SLB Lessor (and not the Construction Lender), and any and all obligations, notices, consents, approvals, payments, and deliveries that were or are to be made to, or for the benefit of, the Construction Lender shall instead be directed to, and made for the benefit of, the SLB Lessor. The Host confirms that all representations, warranties, and confirmations made by it in the Consent remain true and correct as of the date of this Notice.
In accordance with Section 3 of the Consent, the Host is hereby instructed to pay all amounts payable by it under the Solar Project Documents into the account specified immediately below:
Bank: []
ABA Routing Number: []
Account Number: []
Account Name: []
All notices and other communications that Host is required to send to SLB Lessor under the Consent shall be directed as follows:
[]
Attn: []
CF FFP YORBA LINDA CC LLC
By: ________________________
Name:
Title:
SLB LESSOR:
[]
By: ________________________
Name:
Title:
CITY OF YORBA LINDA
Acknowledged by:
[]
By: ________________________
Name:
Title:
Schedule A
Energy Services Agreement – Solar dated September 20, 2023 as amended by that certain OMNIBUS AMENDMENT for the Community Center project located at 4501 Casa Loma Ave, Yorba Linda, CA 92886
General Terms and Conditions of Energy Services Agreement dated July 18, 2023
COMMUNITY DEVELOPMENT DEPARTMENT
DATE: APRIL 21, 2026
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: NATE FARNSWORTH, COMMUNITY DEVELOPMENT DIRECTOR
SUBJECT: APPROVE AN AFFORDABLE HOUSING AGREEMENT AND DENSITY
BONUS AGREEMENT AND DECLARATION OF CC&R WITH THE OLSON
COMPANY
RECOMMENDATION
Approve an Affordable Housing Agreement and Density Bonus Agreement and Declaration of Covenants, Conditions and Restrictions with Olson Urban VI – Yorba Linda 2 LLC.
SUMMARY
The recommended agreement formalizes affordable housing obligations for a development at 4861 Liverpool Street, ensuring eight of the 40 units are sold to qualified moderate-income households and restricted for 45 years.
DISCUSSION
Planning Commission Resolution No. 5655, Condition of Approval No. 108 requires Olson Company to enter into an Affordable Housing Agreement (AHA) to restrict eight moderateincome restricted units to further the State’s affordable housing requirements.
The AHA:
1. Requires eight affordable units to be sold to qualified buyers and with 45-year affordability covenants
2. Restricts the eight units to moderate-income households
3. Requires the developer to identify qualified buyers and sell the units at an affordable price
The developer will sell the units through a City-approved lottery system. Priority will be given to buyers who live and/or work within Yorba Linda.
When the restricted units are re-sold, the new owner must also be income qualified, subject to verification by the City throughout the 45-year covenant.
APPROVE AN AFFORDABLE HOUSING AGREEMENT AND DENSITY BONUS
AGREEMENT AND DECLARATION OF CC&R WITH THE OLSON COMPANY P a g e | 2
FISCAL IMPACT
The City will incur modest costs to monitor and report on the AHA and to verify sales and buyer eligibility.
ALTERNATIVES
Do not approve the recommendation and provide alternative direction.
ATTACHMENT
1. Affordable Housing Agreement and Density Bonus Agreement and Declaration of Covenants, Conditions and Restrictions
882/009410-1018
22554356.7 06/25/25
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attention: City Clerk
(Space Above for Recorder’s Use)
(Exempt from Recordation Fee per Gov. Code § 27383)
AFFORDABLE HOUSING AND DENSITY BONUS AGREEMENT AND
DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS
THIS AFFORDABLE HOUSING AND DENSITY BONUS AGREEMENT AND DECLARATION OF COVENANTS, CONDITIONS, AND RESTRICTIONS (the “Agreement”) is made by and between OLSON URBAN VI – YORBA LINDA 2, LLC, a Delaware limited liability company (the “Developer”), and the CITY OF YORBA LINDA, a California municipal corporation (the “City”) as of the ____ day of ____________, 2026.
R E C I T A L S
A. Developer owns fee title to that certain real property located at 4861 Liverpool Street, in the City of Yorba Linda, County of Orange,State of California, legally described in the legal description attached hereto as Exhibit “A” (the “Property”). The Property comprises approximately one and nine-tenths (1.9) acres.
B. On January 6, 2025, Developer submitted an application to City for development of a new townhome condominium project on the Property, which will include a total of forty (40) units (the “Project”). On December 10, 2025, the City of Yorba Linda Traffic Commission (“Traffic Commission”) held a public hearing regarding the Project, at which the Traffic Commission recommended that the City of Yorba Linda Planning Commission (“Planning Commission”) approve the Project.
On January 14, 2026, the Planning Commission held a public hearing, at which the Planning Commission approved the Project.
C. The Property is zoned Residential Urban (RU) and is in the City’s Congregational Lands Overlay (CLO) Zone, which allows for a minimum of thirty-eight (38) units and a maximum of sixty-six (66) units to be developed on the Property, and requires that a minimum of twenty percent (20%) of the units developed shall be offered to, and sold to low or moderate income households at an affordable housing cost, and such units shall be restricted for a minimum of forty-five (45) years.
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D. Pursuant to the CLO Zone requirements, eight(8) of the residential units to be constructed by Developer pursuant to the Project (the “Affordable Units”) are required to be restricted, for forty-five (45) years, for sale to and ownership and occupancy by households which qualify as “persons and families of moderate income” pursuant to Health and Safety Code section 50093 at an affordable sales price, as calculated and determined pursuant to the methodology set forth in Health and Safety Code section 50052.5.
E. Pursuant to the State of California’s Density Bonus Law (Government Code Section 65915 et seq.) (the “Density Bonus Law”), the Project qualifies for a density bonus (which Developer has elected not to request), two incentives or concessions pursuant to Government Code Section 65915(d)(2)(B), vehicular parking ratios pursuant to Government Code Section 65915(p)(1), and certain waivers or reductions of development standards pursuant to Government Code Section 65915(e)(1).
F. Developer has requested, and City has agreed to and approved the following waivers:
1. A waiver of development standards to allow an approximately 15- foot front yard setback where 20 feet is required.
2. A waiver of development standards to allow a 4-foot side yard interior setback where interior side yard setbacks are required to have a cumulative total of both side yards of 20 feet.
3. A waiver of development standards to allow a 4-foot 8-inch rear yard setback where 25 feet is required.
4. A waiver of development standards to allow a 7-foot minimum building separation where 10 feet is required.
5. A waiver of development standards to allow a 4-foot 8-inch setback to a single-family zone where 100 feet is required for 3-story structures.
6. A waiver of development standards to waive open space requirements.
7. A waiver of development standards to reduce the requirement to provide landscaping on a minimum of 50% of the building site area.
8. A waiver of development standards to allow three-story buildings adjacent to an arterial street where a one-story building height is the maximum allowed.
G. The Project is contemplated to be built in four (4) phases (each a “Phase”), with no Affordable Units to be constructed in the first or second Phases, and four (4) Affordable Units to be constructed in each of the third and fourth Phases. Four (4) of the Affordable Units shall contain one (1) bedroom and one and one-half (1.5) bathrooms, each containing approximately nine hundred seventy-two square feet (972 sf), and four
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(4) of the Affordable Units shall contain two (2) bedrooms and two and one-half (2.5) bathrooms, each containing approximately one thousand two hundred eight square feet (1,208 sf). The location and designation of the Affordable Units, which are unit nos. 20 through 27, are depicted on the site plan, which has been approved by the City and is attached hereto as Exhibit “B” (the “Site Plan”).
H. Developer shall identify the Affordable Units in the covenants, conditions, and restrictions for the Project (the “Association CC&Rs”).
I. Developer’s execution and recordation of, and thereafter compliance with, this Agreement is required as a condition to City’s issuance of a certificate of occupancy for any units within the Project, and Developer’s execution and recordation of, and thereafter compliance with, this Agreement satisfies the Project’s Condition of Approval number 108 of Planning Commission Resolution No. 5655, adopted on January 14, 2026 (“PC Resolution No. 5655), and the affordable housing requirements set forth in Section
18.17.010, et seq., Section 18.17.200 et seq., and Section 18.19.010 et seq. of the Yorba Linda Municipal Code. Because this Agreement is required pursuant to the Density Bonus Law, this Agreement shall be and shall remain in a priority lien position to all deeds of trust, and shall not be subordinated to any financing obtained by Developer and encumbering the Property (with the holder of any such financing referred to hereinafter as a “Subordinate Lender”).
NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein by this reference, and for other valuable consideration, the sufficiency of which is hereby acknowledged, City and Developer agree as follows:
1. Definitions.
a. “Affordable Sales Price” shall mean, as to each Affordable Unit, a sales price that would result in an annual Monthly Housing Cost that is not less than twenty-eight percent (28%) of the gross income of the Moderate Income Household and does not exceed the maximum percentage of income that can be devoted to housing cost by Moderate Income Households under California law. As of the date of this Agreement, the Affordable Sales Price for a Moderate Income Household means a purchase price with a reasonable downpayment, and that would result in an annual Monthly Housing Cost that is (a) not less than twenty-eight percent (28%) of the gross income of the Moderate Income Household, and (b) not more than the product of thirty-five percent (35%) times one hundred ten percent (110%) of the Median Income adjusted for family size appropriate for the property, or, for any Moderate Income Household that has a gross income that exceeds one hundred ten percent (110%) of the Median Income adjusted for family size, the annual Monthly Housing Cost may not exceed thirty-five percent (35%) of the gross income of the Moderate Income Household, all as more particularly set forth in Section 50052.5 of the California Health and Safety Code. Pursuant to Section 50052.5 of the California Health and Safety Code, for purposes of calculating the Affordable Sales Price, “adjusted for family size appropriate for the property” shall mean a household of two (2) persons for a one (1) bedroom Affordable Unit, and three (3) persons for a two (2) bedroom Affordable Unit. For purposes of determining an Affordable Sales Price, a
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“reasonable” downpayment is a downpayment that equals five percent (5%) of the sales price for the Affordable Unit. A calculation of Affordable Sales Price, based on the date of this Agreement, is set forth in Exhibit “D” attached hereto and incorporated herein. As indicated in said Exhibit “D”, the Affordable Sales Price will be updated on the first day of each calendar quarter, to reflect changes (if any) in the Median Income, utilities allowances, and mortgage interest rates; provided, however, that the Affordable Sales Price in effect as of the date Developer enters into a purchase and sale contract with a Moderate Income Household shall remain applicable to said purchase and sale contract for a period of ninety (90) days after the execution of the purchase and sale contract. If, at the end of said ninety (90) day period, the escrow under the purchase and sale agreement has not closed, the Sales Price under the purchase and sale agreement shall be updated to reflect the then-current Affordable Sales Price. b. “Affordable Unit” shall have the meaning ascribed in Recital D of this Agreement.
c. “Association” shall have the meaning ascribed in Section 8 of this Agreement.
d. “Association CC&Rs” shall have the meaning ascribed in Section 8 of this Agreement.
e. “Association Property” means real or personal property designated by the Developer, as the “Declarant” under the Association CC&Rs. or the Board of Directors of the Association. as Association Property and therefore made subject to the restrictions on Association Property established in the governing documents. The Association Property in a “Phase” consists of all the real property described as Association Property in the Condominium Plan for the Phase (except for the Units and the Condominium Common Area shown on the Condominium Plan(s)). The Association Property is “common area” as defined in California Civil Code section 4095. f. “Condominium” means an estate in real property as defined in California Civil Code Section 4125. A Condominium consists of an undivided fee-simple ownership interest in the Condominium Common Area in a Phase, together with a separate ownership interest in fee in a “Unit” as described in the recorded Condominium Plans and as defined in California Civil Code Section 4125, and any easements appurtenant thereto.
g. “Condominium Common Area” means the volumes of airspace described in the Condominium Plan for each Phase, which shall be owned by Owners in each Phase of the Project as tenants-in-common. The Condominium Common Area in each Phase of the Project constitutes the “undivided interest-in-common in a portion of the real property,” in accordance with California Civil Code Section 4125. Condominium Common Area is not Association Property. The undivided fee simple interest in the Condominium Common Area in a Phase is appurtenant to each Unit in such Phase and is a fraction having one (1) as its numerator and the number of Units in that Phase as its denominator.
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h. “Condominium Plan” shall mean the Condominium Plan for a Phase to be recorded in accordance with all applicable regulations of the California Department of Real Estate. The Condominium Plan for each Phase shall identify the Association Property, the Condominium Common Area and the Units in such Phase. i. “Developer” shall mean Developer and any successor in interest of Developer to the Property or any portion thereof, including the Association, but excluding any Owner(s).
j. “Median Income” shall mean the Orange County area median income adjusted for family size as established by the United States Department of Housing and Urban Development, and as published periodically by the State of California Department of Housing and Community Development.
k. “Moderate Income Household” shall mean a household whose annual income does not exceed the qualifying limits under California law for “persons and families of moderate income” as defined in California Health and Safety Code section 50093 and as published periodically by the State of California Department of Housing and Community Development.
l. “Monthly Housing Cost” shall include all of the following associated with an Affordable Unit, estimated or known as of the date of the proposed sale of the Affordable Unit: (a) principal and interest payments to be paid in the form of loan proceeds on a thirty (30) year fixed mortgage loan and any loan insurance fees associated therewith; (b) property taxes and assessments; (c) flood insurance, if required by the Owner’s primary mortgage lender or by the Association CC&Rs; (d) fire and casualty insurance covering replacement value of property improvements, unless such insurance is procured by the homeowner association; (e) homeowner association fees; (f) lease payments for solar equipment, if required, unless the amount of such payments are included in the reasonable utility allowance; and (g) a reasonable utility allowance. The Monthly Housing Cost of a purchaser shall be an average of estimated costs for the next twelve (12) months. Notwithstanding anything in this Agreement to the contrary, Developer agrees that until such time as Developer has sold the last condominium unit in the Project, the homeowner association fees charged to each owner of an Affordable Unit shall not exceed Three Hundred Seventy-Five Dollars ($375) per month. m. “Owner” shall mean a Moderate Income Household to whom Developer has conveyed fee title to one of the Affordable Units. n. “Phase” shall mean all of the real property and improvements described and designated as a Phase of the Project in the Association CC&Rs or in a recorded Supplemental Agreement or Notice of Addition to the Association CC&Rs, the Units of which are described in a Final Subdivision Public Report issued by the California Department of Real Estate.
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o. “Proposed Buyer” shall mean a person or family determined to be a Moderate Income Household to whom Developer desires and proposes to Transfer an Affordable Unit.
p. “Sales Price” shall mean all sums paid by a Moderate Income Household to Developer for, or in conjunction with, the acquisition of an Affordable Unit, including the purchase price designated in any purchase agreement, consideration for personal property and all other costs and fees paid by the Moderate Income Household, to or for the benefit of the Developer.
q. “Subordinate Lender” shall have the meaning ascribed in Recital I of this Agreement.
r. “Transfer” shall mean any sale, assignment, or transfer of an interest in an Affordable Unit(excluding any sale, assignment or transfer of Developer’s interest in the Property resulting as a consequence of, or immediately subsequent to, a foreclosure or conveyance in lieu of foreclosure), including, without limitation, a fee simple interest, tenancy in common, joint tenancy, community property, tenancy by the entireties, life estate, or other limited estate, leasehold interest or any rental of the Affordable Unit. s. “Unit” shall mean a separate interest in space as defined in Section 4125(b) of the California Civil Code. Each Unit is a separate freehold estate, as separately shown, numbered and designated in the Condominium Plan for each Phase.
Each Unit includes the residential element and a garage element as depicted on the Condominium Plan for each Phase. The Project is comprised of forty (40) Units.
2. Sale of Affordable Units.
Developer shall sell the Affordable Units to Moderate Income Households at an Affordable Sales Price. Subject to the terms of this Section 2, Developer agrees to commence to market each Affordable Unit at the earliest feasible time, but not later than the completion of construction of said Affordable Unit. Developer shall sell the Affordable Units pursuant to a lottery system, which, through randomized selection, shall assign priority to applicants for the Affordable Units (the “Lottery List”). Prior to implementation of any such lottery system, Developer shall submit its proposed lottery system to City for review and approval, which approval shall not be unreasonably withheld, conditioned or delayed Notwithstanding anything to the contrary in this Agreement, the minimum household size for a Proposed Buyer shall be one (1) person per bedroom, and the maximum household size for a Proposed Buyer shall be two (2) persons per bedroom plus one (1). For example, for a two-bedroom Afrordable Unit, the minimum household size of a Proposed Buyer shall be two (2) persons and the maximum household size for a Proposed Buyer shall be five (5) persons.
During the first fourteen (14) days of Developer’s marketing efforts for the Affordable Units, Developer shall build an interest list of applicants for the Affordable Units from the general public without restrictions. Developer shall conduct the lottery from said interest list following the conclusion of the foregoing fourteen (14) day exclusive marketing
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period. Upon completion of the lottery, the Lottery List will be sorted into two categories, (1) the general public, and (2) those who live and/or work in the City of Yorba Linda.
Developer shall prioritize persons who live and/or work within the City of Yorba Linda(“Yorba Linda Applicants”), subject to any applicable federal, state or local law. The Yorba Linda Applicants on the Lottery List shall be offered an Affordable Unit in the order of their lottery ranking until all Yorba Linda Applicants have received an opportunity to purchase an Affordable Unit. Thereafter, if any Affordable Units remain, Developer may offer the remaining Affordable Units to any other applicants on the Lottery List in order of their position on the Lottery List. Once the Lottery List is exhausted, Developer may sell the remaining Affordable Units to Moderate Income Households at its discretion without the need for a second lottery.
Any of Developer, Developer’s officials and employees, and the immediate family members of Developer’s officials and employees shall be ineligible to purchase an Affordable Unit(the “Developer Eligibility Prohibition”). All of Developer’s advertising and marketing materials pertaining to the Affordable Units, including, without limitation, postings or publications on the Internet, shall contain astatement regarding the Developer Eligibility Prohibition. Escrow for the sale of an Affordable Unit by Developer to a Moderate Income Household shall not close until after issuance of a certificate of occupancy to be issued by the City of Yorba Lindabuilding department for such Affordable Unitas well as issuance of a Final Subdivision Public Report by the California Department of Real Estate. As used herein, the term “immediate family member” shall mean and include a parent or step-parent, grandparent or step-grandparent, sibling or step-sibling, and child or step-child.
3. Restrictions on Transfer by Sale of Any Affordable Unit. a. General. Upon Developer’s sale of all eight (8) Affordable Units in accordance with the terms of this Agreement, Developer shall have no further obligations or liability under this Agreement, or any responsibility with respect to the Affordable Units, except as expressly set forth in Section 4, subdivision (e), and Section 10 of this Agreement.
b. Determination of Sales Price.
DEVELOPER UNDERSTANDS THAT THE DETERMINATION OF THE SALES
PRICE CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING
INTO CONSIDERATION INTEREST RATES, PROPERTY TAXES AND OTHER
FACTORS THAT CANNOT BE ACCURATELY PREDICTED AND THAT THE SALES
PRICE PERMITTED HEREUNDER MAY BE LESS THAN THE FAIR MARKET VALUE
OF THE PROPERTY AND MAY NOT INCREASE OR DECREASE IN THE SAME
MANNER AS OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. DEVELOPER FURTHER ACKNOWLEDGES THAT IN SETTING
THE SALES PRICE, THE PRIMARY OBJECTIVE OF CITY AND THIS AGREEMENT IS
TO PROVIDE HOUSING TO QUALIFIED HOUSEHOLDSAT AN AFFORDABLE SALES PRICE. THE SALES PRICE MAY BE LESS THAN OTHER SIMILAR PROPERTIES WHICH HAVE NO RESTRICTIONS.
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Developer’s Initials
c. Transfer of an Affordable Unit.
Developer may transfer an Affordable Unit only in strict accordance with the provisions of this Agreement. Specifically, Developer may only transfer an Affordable Unit to a Moderate Income Household. Any such transfer may be made only if (i) the sales price for the Affordable Unit does not exceed an Affordable Sales Price for said buyer; and (ii) the Transfer has previously been approved in writing by City, which approval shall not be unreasonably withheld, conditioned or delayed, and which approval shall be evidenced by City’s execution of the “Request for Verification of Proposed Buyer” (as defined in Section 4a below) for said buyer.
In order to comply with this Subsection 3c, Developer must apply the Affordable Sales Price for the Proposed Buyer of the Affordable Unit in accordance with the definitions set forth in Section 1 of this Agreement. City housing staff will provide Developer with the then current Affordable Sales Prices on the first day of each calendar quarter until such time as all of the Affordable Units have been sold. City shall have the right to review and approve, at City’s election, which approval shall not be unreasonably withheld, conditioned or delayed, the form of the purchase and sale agreement proposed to be used by Developer for the sale of the Affordable Units prior to execution thereof by a Proposed Buyer; provided, however, that such right to approve shall be limited to conformance of the purchase and sale agreement with the terms of this Agreement.
4. Process to Complete Transfer by Sale of Condominiums.
Not less than four (4) weeks prior to Developer’s Transfer by sale of an Affordable Unit, Developer shall do all of the following:
a. Notice to City: Developer shall send, or shall cause the Proposed Buyer’s mortgage lender to send, to City, at 4845 Casa Loma, Yorba Linda, California 92886, the form attached hereto and incorporated herein as Exhibit “C” (“Request for Verification of Proposed Buyer”) fully completed and executed by each of Developer, the Proposed Buyer, and the Proposed Buyer’s mortgage lender (the “Mortgage Lender”), accompanied by all documents and materials received by Developer and/or the Mortgage Lender, and necessary in order for Developer, the Mortgage Lender and City to make a determination that the Proposed Buyer is a Moderate Income Household and that the Sales Price is an Affordable Sales Price for the Proposed Buyer, as required pursuant to Sections 4b and 4c below (collectively, the “Supporting Eligibility Documentation”). b. Qualification of Proposed Buyer. No Transfer shall occur unless and until determination is made based on the Request for Verification of Proposed Buyer and Supporting Eligibility Documentation (collectively, the “Verification and Supporting Documentation”) that the Proposed Buyer is a Moderate Income Household who intends to occupy the Affordable Unitas his/her principal residence. Each Request for Verification of Proposed Buyer shall include a statement by the Proposed Buyer certifying its intent with regard to the occupancy of the Affordable Unit and as to the truth and accuracy of all
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of the Verification and Supporting Documentation, including, without limitation, all information supplied as to the Gross Income (calculated as set forth in 25 Cal. Code of Regs., Section 6914) of the Proposed Buyer. Each of Developer and the Mortgage Lender shall certify, pursuant to the Request for Verification of Proposed Buyer the information provided in the Verification and Supporting Documentation. Each of Developer and the Mortgage Lender shall be entitled to rely on the Verification and Supporting Documentation in making the determination required by this subsection 4b unless Developer and/or the Mortgage Lender (as applicable) has knowledge of, or a reasonable basis for belief as to, the inaccuracy or falsehood of any of information in the Verification and Supporting Documentation (the “Review Standard”). c. Affordable UnitSales Price. The Sales Price for the Affordable Unit shall not exceed an Affordable Sales Price for the proposed Buyer. In determining the Affordable Sales Price, the family size of the Proposed Buyer shall be deemed to be two (2) persons in the case of a one (1) bedroom unit, and three (3) persons in the case of a two (2) bedroom unit.
d. Certificates from Developer and Proposed Buyer; Disclosure. Each Request for Verification of Proposed Buyer shall include an “Owner’s Certificate” that, based on the information included in the Verification and Supporting Documentation but subject to the Review Standard, (i) Developer has made the affirmative determination required by Section 4b above that the Proposed Buyer is a Moderate Income Household, and (ii) the Sales Price is an Affordable Sales Price as required by Section 4c above.
Within thirty (30) days after City’s receipt of the Verification and Supporting Documentation, City shall approve, disapprove, or conditionally approve the Proposed Buyer’s eligibility to purchase an Affordable Unit as a Moderate Income Household who intends to occupy the Affordable Unit as his/her principal residence, which approval shall not be unreasonably withheld, conditioned, or delayed. City’s approval shall be made by City’s execution of the Request for Verification of Proposed Buyer for said buyer. Further, Developer and Proposed Buyer each shall certify in writing, on the Request for Verification of Proposed Buyer, that the Transfer shall be closed in accordance with, and only with, the terms of a purchase and sale contract, the general form of which has been submitted to and approved by City before execution of this Agreement, and the salient terms of which have been provided to City for review and approval (all of which review and approval by City was or is (as applicable) limited to a determination by City that the purchase and sale contract and salient terms thereof are in conformance with this Agreement) and that all consideration delivered by the Proposed Buyer to Developer has been fully disclosed to City. Notwithstanding anything to the contrary in this Section 4, Developer shall have the right, but shall not be obligated, to seek a preliminary determination from City regarding a Proposed Buyer and a proposed Sales Price (a “Preliminary Determination”) prior to compiling and submitting to City all of the Verification and Supporting Documentation.
e. Failure to Comply. In the event a Transfer is made in violation of the terms of this Agreement or false or misleading statements are made in any documents or certificate submitted to City for its approval of the Transfer, City shall be entitled to all available remedies in law or equity, including, without limitation, the right to file an action
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at law or in equity against Developer and/or the Proposed Buyer (as applicable) to seek to enforce the terms of this Agreement; provided, however, that City shall only have the right to file an action against Developer if City has determined or has a reasonable belief that Developer violated the terms of this Agreement. Further, in the event Developer fails to comply with Sections 4a, 4b, 4c, or 4d above, as determined by a court of competent jurisdiction, any costs, liabilities or obligations incurred by Developer and its Proposed Buyer for the return of any monies paid or received or for any costs and legal expenses, shall be borne jointly and severally by Developer and its Proposed Buyer and such parties shall hold City harmless and reimburse City’s expenses, costs, and reasonablelegal fees for any action City takes in enforcing the terms of this Section 4e. f. Qualification by City Housing Consultant. Developer agrees that City may retain an affordable housing consultant (the “City Consultant”)to assist in the review and qualification of Developer’s proposed buyers, including any Preliminary Determinations requested by Developer. With respect to the foregoing, within five (5) days after the date of this Agreement, Developer shall deposit Fifteen Thousand Dollars ($15,000) (the “Deposit Funds”) with City to cover all costs charged by the City Consultant to qualify said initial buyers. Within forty-five (45) days after the date Developer has sold all Affordable Units to Moderate Income Households, as verified by the City Consultant, City shall return all unexpended Deposit Funds to Developer. Notwithstanding any of the foregoing, in the event that at any time prior to the City Consultant’s qualification of Affordable Units for all of the Moderate Income Households pursuant to this paragraph the outstanding balance of the Deposit Funds held by City drops below Five Thousand Dollars ($5,000), Developer shall deposit an additional Five Thousand Dollars ($5,000) with City.
g. City Affordable Housing Documents; Partial Termination. Developer shall require each Proposed Buyer to execute, with signatures acknowledged (as applicable), (i) an Affordable Housing Agreement with Resale Restrictions setting forth the affordable housing, owner occupancy, and resale requirements with respect to the Affordable Unit (the “Moderate Income Household AHA”), (ii) a Deed of Trust securing the obligations of the Moderate Income Household under the Moderate Income Household AHA, including certain payment and reimbursement obligations triggered by default of the Owner under the Moderate Income HouseholdAHA (the “Deed of Trust”), (iii) an Affordable Housing Disclosure Statement (the “Disclosure”), and (iv) a Subordination Agreement pursuant to which (a) the deed of trust securing the Owner’s primary mortgage (the “Primary Mortgage Deed of Trust”) is subordinated to the Moderate Income Household AHA, and (b) the Deed of Trust is subordinated to the Primary Mortgage Deed of Trust (the “Subordination Agreement”). The forms of the Moderate Income Household AHA, Deed of Trust, Disclosure, and Subordination Agreement shall be provided to Developer. Each of City and Developer acknowledges and agrees that Condition of Approval No. 108 in PC Resolution No. 5655 inadvertently contains two (2) incorrect references to the required term for the Moderate Income Household AHA (i.e., Condition of Approval No. 108 references both 30 years and 55 years), and notwithstanding those inaccuracies the requiredterm for the Moderate Income Household AHA is forty-five (45) years, as stated in each of Recital C and Recital D of this Agreement, and as will be set forth in each Moderate Income Household AHA. On the
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thirtieth (30th) day following the close of any transfer of an Affordable Unit to a Moderate Income Household, provided (1) the documents described in clauses (i), (ii), (iii), and (iv) of this Section 4g have been duly executed, with signatures acknowledged (as applicable), and (with the exception of the Disclosure) recorded in the Official Records of Orange County, and (2) City has not notified Developer, in writing that City has determined the sale was not made in compliance with the terms of this Agreement, Developer shall be automatically released from this Agreement with respect to the sold Affordable Unit. If requested, in writing, by Developer, City agrees to execute and record a release and partial termination which terminates this Agreement with respect to any such sold and released Affordable Unit(s).
h. Delivery of Documents. Upon the close of the proposed Transfer, Developer shall provide City with a copy of the recorded documents, including a copy of the recorded Moderate Income Household AHA, Deed of Trust, and Subordination Agreement, a copy of the final sales contract, settlement statement, escrow instructions, Disclosure, all certificates required by this Section 4, and any other documents which City may reasonably request.
5. Nondiscrimination Covenants.
In addition to any other nondiscrimination provisions applicable to the Property under federal, state or local law, 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 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 Property, or any part thereof, nor shall Developer, 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, subtenants, sublessees or vendees of the Property, or any part thereof. The foregoing covenants shall run with the land.
6. Maintenance of Property.
Developer shall maintain the Property and all improvements thereon, including, without limitation, all buildings, signage, lighting, landscaping, and irrigation of landscaping, in good condition, free of debris, waste and graffiti, and in compliance with all applicable provisions of the Yorba Linda Municipal Code.
After the Association Property has been transferred to the Association in accordance with the terms of the Association CC&Rs, the Association shall be responsible for the foregoing maintenance with respect to the Association Property.
7. Amenities and Location.
The Affordable Units shall be similar to the base plan of the Project market rate units in terms of design, appearance, materials, finished quality and interior amenities. In
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addition to the eight(8) Affordable Units described in Recitals D and G above, the Project includes thirty-two (32) market rate units. The market rate units consist of the following:
fourteen (14) four (4) bedroom and three and a half (3.5) bathroom units, each containing approximately one thousand nine hundred seven square feet (1,907 sf) and eighteen (18) three bedroom and two and a half (2.5) bathroom units, each containing approximately two thousand ten square feet (2,010 sf). The Affordable Units consist of the following: four (4) one (1) bedroom and one and a half (1.5) bathroom units, each containing, approximately nine hundred seventy-two square feet (972 sf); and four (4) two (2) bedroom and two and a half (2.5) bathroom units, each containing approximately one thousand two hundred eight square feet (1,208 sf). Issuance of a certificate of occupancy by the City shall constitute final approval that an Affordable Unit complies with this Section 7 and Condition of Approval number 108 of PC Resolution No. 5655.
8. Conveyance of Association Property to Association.
Prior to the first close of escrow of one of the Affordable Units, Developer shall (i) establish a homeowners association (the “Association”) for the purpose of maintaining the Association Property; (ii) prepare and record covenants, conditions, and restrictions setting forth the respective maintenance obligations of the Owners and the Association (the “Association CC&Rs”); and (iii) convey the Association Property to the Association on a Phase by Phase basis to enable the Association to perform the maintenance obligations hereunder, and as set forth in the Association CC&Rs. The Association CC&Rs shall expressly state that until such time as Developer conveys the Association Property to the Association, Developer shall be responsible for maintaining the Association Property.
9. Property Taxes.
Developer shall not seek exemption from the payment of property taxes and assessments for any portion of the Property or take any other action that would result in any portion of the Property being exempt from the imposition of property taxes and assessments.
10. Indemnification.
Developer shall defend, indemnify and hold harmless City and City’s officers, officials, agents, employees, representatives, and consultants (individually, an “Indemnified Party” and collectively, the “Indemnified Parties”) from and against any actual loss, damage, costs, expenses, liability, claim, or judgment relating in any manner to Developer’s performance under this Agreement, except to the extent caused by the active negligence or willful misconduct of an Indemnified Party.
11. Insurance.
Developer shall procure and maintain, at its sole cost and expense, in a form and content satisfactory to City, the following policies of insurance:
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Commercial General Liability Insurance. A policy of commercial general liability insurance written on a per occurrence basis in an amount not less than a combined single limit of Three Million Dollars ($3,000,000) or its equivalent.
Worker’s Compensation Insurance. A policy of worker’s compensation insurance in such amount as will fully comply with the laws of the State of California.
Builder’s Risk. Builder’s risk coverage written on a completed value basis in an amount equal to the full replacement cost of the improvements with coverage available on the “all risk” form of policy, and may be on a reporting form, including coverage against collapse, fire, and water damage, with such insurance to be in such amounts and form and written by such companies as shall be approved by City. City agrees to accept a builder’s risk insurance policy from the general contractor for the Project in conformance with the requirements set forth herein.
Automobile Liability Insurance. Automobile liability insurance (bodily injury and property damage liability) which coverage shall include owned, hired, and non-owned automobiles, with limits of liability of not less than One Million Dollars ($1,000,000.00) combined single limit per accident for bodily injury and property damage combined.
All of the above policies of insurance shall be primary insurance and except for the Worker’s Compensation Insurance shall name the Indemnified Parties as additional insureds. Said policies shall be satisfactory only if issued by companies qualified to do business in California and rated A:VII or better in the most recent edition of the Best Rating Guide. The insurer shall waive all rights of subrogation and contribution it may have against the Indemnified Parties and their respective insurers. All of said policies of insurance shall provide that said insurance may not be amended or canceled without providing thirty (30) days prior written notice by registered mail to City. In the event any of said policies of insurance are canceled, Developer shall, prior to the cancellation date, submit new evidence of insurance in conformance with this Section 11 to the City Manager of City. The foregoing obligations shall remain in effect until Developer has sold each Affordable Unit to a Moderate Income Household.
The Association shall maintain policies of commercial general liability and fire and casualty insurance in the limits set forth in California Civil Code sections 5800 and 5805 and as may be required by the California Department of Real Estate.
In no event shall the limits of any policy be considered as limiting the liability of Developer hereunder or limiting the indemnity obligation of Developer set forth in Section 10 of this Agreement.
12. Repair of Damage.
If any of the Affordable Units and/or any improvements on the Property necessary for continued occupancy of the Affordable Units (collectively, the “Required Units & Improvements”) shall be totally or partially destroyed or rendered wholly or partly uninhabitable by fire or other casualty, Developer (or the Association if Developer has transferred the damaged portion of the Required Units & Improvements to the
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Association), 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 Required Units & Improvements to substantially the same condition as the Required Units & Improvements are required to be maintained under the terms of this Agreement, whether or not the insurance proceeds are sufficient to cover the actual cost of repair, replacement, or restoration, and Developer (or the Association if Developer has transferred the damaged portion of the Required Units & Improvements to the Association), shall complete the same as soon as possible thereafter so that the Required Units & Improvements or damaged portion thereof can continue to be developed and occupied as affordable housing units in accordance with this Agreement. In no event shall the repair, replacement, or restoration period exceed twelve (12) months from the date or the destruction unless the City Manager of City, in his or her sole and absolute discretion, approves a longer period of time.
13. Defaults and Remedies.
a. Defaults. Failure or delay by any party to perform any term or provision of this Agreement which is not cured within thirty (30) days after receipt of notice from the other party specifying the default (or ten (10) days with respect to defaults regarding inadequate maintenance of the Property, including, without limitation, graffiti removal and landscaping/landscaping irrigation repairs) constitutes a default under this Agreement; provided, however, if such default is of the nature requiring more than thirty (30) days to cure, the defaulting party shall avoid default hereunder by commencing to cure within such thirty (30) day period, and thereafter diligently pursuing such cure to completion. Except as required to protect against further damages, the injured party may not institute proceedings against the party in default until thirty (30) days after giving such notice. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default.
b. Institution of Legal Actions. In addition to any other rights or remedies, any party may institute legal action to cure, correct, or remedy any default, to recover damages for any default, or to obtain any other legal or equitable remedy consistent with the purposes of this Agreement; provided, however, that notwithstanding anything in the foregoing to the contrary, (i) in no event shall Developer be entitled to obtain monetary damages of any kind from City, including but not limited to damages for economic loss, lost profits, or any other consequential, punitive or special damages of any kind, (ii) in no event shall City be entitled to obtain monetary damages of any kind from Developer, including but not limited to damages for economic loss, lost profits, or any other consequential, punitive or special damages of any kind, and (iii) in no event shall any partner, member, shareholder, board member, director, commissioner, officer, employee, official or agent of Developer be personally liable to City, including for any amount that may become due under this Agreement. Notwithstanding clause (ii) and (iii) above, nothing contained herein is intended to relieve Developer and, if Developer is a partnership, limited liability company, or corporation, any general partner, member, or shareholder of Developer of liability for damages caused to City as a result of (i) fraud or willful misrepresentation. Such legal actions must be instituted and maintained in the
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Superior Court of the County of Orange, State of California, or in any other appropriate court in that county.
c. Rights and Remedies are Cumulative. The rights and remedies of the parties are cumulative, and the exercise by any party of one or more of its 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 any other party.
14. Covenants Do Not Impair Liens.
This Agreement shall not prevent or limit Developer, in any manner, at its sole discretion, from encumbering the portion of the Property owned by it, or any portion thereof or any improvement thereon, by any mortgage, deed of trust, or other security device securing financing with respect to such portion of the Property. The City acknowledges that the lenders providing such financing may request certain interpretations and/or modifications and agrees, upon request from time to time, to meet with the Developer and the representatives of such lenders to negotiate in good faith any such request for interpretation or modification. Subject to compliance with applicable laws, the City will not unreasonably withhold its consent to any such requested interpretation or modification provided that such interpretation or modification is consistent with the intent and purposes of this Agreement and does not have an adverse impact on the City's rights or obligations hereunder. The Parties hereto understand and agree that, notwithstanding any provisions contained in this Agreement, the restrictions and covenants hereunder are not intended by the Parties hereto to grant any right of foreclosure, under the laws of the jurisdiction where the Project is located, to any Party hereto upon a default of any provision herein, rather they are intended by the Parties hereto to constitute a restrictive covenant that is filed of record prior in time to any instrument or agreement granting a security interest in the Project or Property, and that, notwithstanding a foreclosure or transfer of title pursuant to any other instrument or agreement, the restrictive covenants and provisions hereunder shall remain in full force and effect.
No violation or breach of covenants, conditions, restrictions, provisions, or limitations contained in this Agreement shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security instrument.
15. Conflict with Other Laws; Severability.
In the event that any provision of this Agreement is found to be contrary to applicable law, then such provisions shall be deemed modified in a manner which is consistent with the goals and intent of this Agreement to provide housing to Moderate Income Households at an Affordable Sales Price.
Every provision of this Agreement is intended to be severable. In the event any term or provision of this Agreement is declared by a court of competent jurisdiction to be unlawful, invalid or unenforceable for any reason, such determination shall not affect the
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balance of the terms and provisions of this Agreement, which terms and provisions shall remain binding and enforceable.
16. Covenants for Benefit of City.
This Agreement is designed to create equitable servitudes and covenants running with the Property, in accordance with the provisions of Civil Code Section 1468. The covenants, conditions, restrictions, reservations, equitable servitudes, liens and charges set forth herein shall run with the Property and shall be binding upon all persons having any right, title or interest in the Property, or any part thereof, their heirs, successive owners and assigns; shall inure to the benefit of City and its successors and assigns, shall be binding upon Developer, its successors and assigns and successors in interest; and may be enforced by City and its successors and assigns. Developer hereby declares its understanding and intent that the burden of the covenants set forth herein touch and concern the land and that Developer’s interest in the Property is rendered less valuable thereby. Developer hereby further declares its understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Property by Moderate Income Households, and by furthering the public purposes of City.
In amplification and not in restriction of the provisions set forth hereinabove, it is intended and agreed that City is deemed a beneficiary of the agreements and covenants provided herein both for and in its own right and also for the purposes of protecting the interests of the community. All covenants without regard to technical classification or designation shall be binding for the benefit of City and such covenants shall run in favor of City for the entire period during which such covenants shall be in force and effect, without regard to whether City is or remains an owner of any land or interest therein to which such covenants relate. However, all such covenants and restrictions shall be deemed to run in favor of all real property owned by City which real property shall be deemed the benefited property of such covenants. City shall have the right, in the event of any breach of any such agreement or covenant, to exercise all of the rights and remedies, and to maintain any action at law or suit in equity or other proper proceedings to enforce the curing of such breach of agreement or covenant.
17. Partial Release of Agreement.
Upon written request from Developer and Developer’s delivery to City of a legal description of the Affordable Units, City shall terminate and release the encumbrance of this Agreement as to the Property, excluding the Affordable Units (the “Partial Release”).
The City shall promptly execute, acknowledge and deliver for recordation such instrument(s) as reasonably necessary to cause the Partial Release, which may include replacing Exhibit “A” with a legal description of the Affordable Units, which shall remain subject to this Agreement until released in accordance with the terms of Section 4g above.
18. Full Release and Termination. Unless City has notified Developer, in writing and pursuant to the terms of Section 4g above, that City has determined a sale of an Affordable Unit was not made in compliance with the terms of this Agreement, then on
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the thirtieth (30th) day following the close of escrow for the last Affordable Unit to a Moderate Income Household, this Agreement shall automatically terminate and be of no further force and effect. If requested by Developer, City shall execute and record a termination and release of this Agreement.
19. Notices, Demands and Communications.
Written notices, demands and communications between Developer and City shall be sufficiently given if (i) delivered by hand, (ii) delivered by reputable same-day or overnight courier service that provides a receipt showing date and time delivery, or (iii) dispatched by registered or certified mail, postage prepaid, return receipt requested, as follows:
Developer: Olson Urban VI – Yorba Linda 2, LLC
c/o Olson Company
3010 Old Ranch Parkway, Suite 100
Seal Beach, CA 90740
Attn: Steve Armanino
copy to: Jackson Tidus
2030 Main Street, Suite 1500
Irvine, CA 92614
Attn: Sarah Kleinberg, Esq
City:
City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attn: City Manager
copy to: Rutan & Tucker, LLP
18575 Jamboree Road, 9th Floor
Irvine, CA 92612
Attn: Todd Litfin, Esq.
Such addresses for notice may be changed from time to time upon notice to the other party.
Any written notice, demand or communication shall be deemed received upon receipt if delivered by hand or by same-day or overnight courier, and shall be deemed received on the third (3rd) calendar day from the date it is postmarked if delivered by registered or certified mail.
20. Assignment.
a. Assignment by City. City shall not assign all or anypart of its interest in this Agreement to a third party without obtaining the prior written consent of Developer, which consent shall not be unreasonably withheld, conditioned, or delayed.
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b. Assignment by Developer. Developer shall not, whether voluntarily, involuntarily, or by operation of law, assign all or any part of its interest in this Agreement to a third party without obtaining the prior written consent of City, which consent shall not be unreasonably withheld, conditioned, or delayed. If City approves an assignment, the assignment shall not be effective unless and until the proposed assignee executes and delivers to City an agreement in form satisfactory to City’s legal counsel assuming the obligations of the assignor which have been assigned. Nothing in this Section 20b is intended to restrict Developer from transferring, in accordance with this Agreement,(i) an Affordable Unit to a Moderate Income Household, and (ii) the Association Property in the Project to the Association. Notwithstanding the foregoing or anything to the contrary contained in this Agreement, any sale, assignment or transfer of Developer’s interest in the Property resulting as a consequence of, or immediately subsequent to, a foreclosure or conveyance in lieu of foreclosure shall not be deemed an assignment, sale, gift, encumbrance, hypothecation or transfer of Developer’s rights or obligations under this Agreement, and as such, any such sale or transfer shall not be subject to City’s prior written consent.
21. Attorneys’ Fees and Costs.
If a party to this Agreement commences an action against the other party to this Agreement arising out of or in connection with this Agreement, the prevailing party shall be entitled to recover reasonable attorneys’ fees, expert witness fees, costs of investigation, and costs of suit from the losing party to the extent determined by a court of competent jurisdiction in a final non-appealable decision.
22. Entire Agreement, Waivers, and Amendments.
This Agreement contains the entire agreement between the parties relating to the subject matter hereof, and supersedes all negotiations and previous agreements between the parties with respect to all or part of the subject matter hereof. All waivers of the provisions of this Agreement must be in writing and signed by the appropriate authorities of the party to be charged. A waiver of the breach of the covenants, conditions or obligations under this Agreement by any party shall not be construed as a waiver of any succeeding breach of the same or other covenants, conditions or obligations of this Agreement. Any amendment or modification to this Agreement must be in writing and executed by the appropriate authorities of City and Developer.
23. Interpretation; Governing Law.
This Agreement shall be construed according to its fair meaning and as if prepared by both of the parties hereto. This Agreement shall be construed in accordance with the internal laws of the State of California.
24. City Approvals and Actions.
City shall maintain authority of this Agreement and the authority to implement this Agreement through the City Manager of City (or his or her duly authorized representative).
The City Manager shall have the authority to make approvals, issue interpretations,
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execute documents, waive provisions, and/or enter into certain amendments of this Agreement on behalf of City so long as such actions do not materially or substantially change the basic business terms hereof, change the uses or development permitted on the Property, or add to the costs incurred or to be incurred by City. All other material and/or substantive interpretations, waivers, or amendments shall require the consideration, action and written consent of the City Council.
25. Amendments.
All amendments to this Agreement must be in writing, signed by Developer and City (or their successors-in-interest) and recorded in the Official Records of Orange County, California.
26. Third Party Beneficiaries.
The performance of City’s and Developer’s respective obligations under this Agreement is not intended to benefit any party other than City or Developer. To the extent legally permissible, no person or entity not a signatory to this Agreement shall have any rights or causes of action against any Party to this Agreement as a result of that party’s performance or non-performance under this Agreement, or for the enforcement of any provisions of this Agreement.
27. Counterparts.
This Agreement may be executed in counterparts each of which, when both Developer and City have signed this Agreement, shall be deemed an original and shall constitute one and same instrument.
28. Subordinate Lender Cure Rights.
Provided a Subordinate Lender has provided City with written notice of its address for notice purposes, City shall notify such Subordinate Lender in writing concurrently with any notice given to Developer of any default by Developer under this Agreement, and City agrees that any such Subordinate Lender has the right (but not the obligation) to cure any breach or default specified in such notice within the time periods set forth below, and City will not declare a default of this Agreement, as to such Subordinate Lender, if such Subordinate Lender cures such default within thirty (30) days from and after the expiration of the time period provided in the this Agreement for the cure thereof by Developer; provided, however, that if such default cannot with diligence be cured by such Subordinate Lender within such thirty (30) day period, the commencement of action by such Subordinate Lender within such thirty (30) day period to remedy the same shall be deemed sufficient so long as such Subordinate Lender pursues such cure with diligence to completion; provided, however, further, if such Subordinate Lender is legally restrained from commencing such exercise (e.g., in the context of a stay of bankruptcy of Developer), then such periods shall be extended while such Subordinate Lender is pursuing relief from the same. A Subordinate Lender may cause a Request for Notice to be recorded on the Property subsequent to the recordation of the first lien deed of trust or mortgage requesting a statutory notice of default as set forth in the California Civil Code
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Section 29246. Such notice shall be sent to: City of Yorba Linda, 4845 Casa Loma Yorba Linda, CA 92886, Attention: City Manager.
[end – signature page follows]
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IN WITNESS WHEREOF, City and Developer have caused this instrument to be executed on their behalf of their respective officers hereunto duly authorized as of the date set forth above.
Executed at Yorba Linda, California
this day of ,
2026
“City”
CITY OF YORBA LINDA,
a California municipal corporation
By:
Peter Grant, City Manager
Attest:
_______________________________
Marcia Brown, City Clerk
APPROVED AS TO FORM
RUTAN & TUCKER, LLP
Todd O. Litfin, City Attorney
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Executed at
, California
this day of
, 2026
“Developer”
OLSON URBAN VI – YORBA LINDA 2, LLC
a Delaware limited liability company
By: OLSON URBAN COMMUNITIES VI, LLC
a Delaware limited liability company
Sole Member
By: OLSON URBAN VENTURES VI, LLC
a Delaware limited liability company
Sole Member
By: OLSON URBAN HOUSING, LLC
a Delaware limited liability
company
Operating Member
By: IN TOWN LIVING, INC.
a Delaware corporation
Managing Member
By:_______________
Name: ____________
Title:______________
By:_______________
Name: ____________
Title:______________
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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 )
County of Orange )
On _________________________, before me, ,
(insert name and title of the officer)
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 (Seal)
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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 )
County of Orange )
On _________________________, before me, ,
(insert name and title of the officer)
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 (Seal)
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LIENHOLDER CONSENT AND
SUBORDINATION OF LIEN
The undersigned beneficiary (“Subordinate Lender”) under that certain Construction Deed of Trust with Absolute Assignment of Leases and Rents, Security Agreement and Fixture Filing (as amended, amended and restated, restated, supplemented or otherwise modified from time, the “Deed of Trust”) recorded in the Official Records of Orange County, California (the “Official Records”) on or about the same date hereof (the “Deed of Trust”), hereby consents to the recordation of the Affordable Housing and Density Bonus Agreement and Declaration of Covenants, Conditions, and Restrictions (the “Agreement”) to which this instrument is attached and hereby subordinates. In addition, Subordinate Lender hereby provides notice that any notice to Subordinate Lender under the Agreement should be provided to the address below:
Wells Fargo Bank, National Association
2030 Main Street, Floor 08
Irvine, CA, 92414-7255
MAC E2231-080
Attention: Cinthya Martinez Hanselman
Loan No: 79533
[Signature on following page]
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Executed as of this _____ day of ______________, 2026.
WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Administrative Agent
By:
Name:
Its: ______
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 )
COUNTY OF )
On _______________ before me,
____________________________________________, Notary Public, personally appeared ____________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature ________________________ (Seal)
882/009410-1018
22554356.7 06/25/25 EXHIBIT “A”
EXHIBIT “A”
LEGAL DESCRIPTION OF PROPERTY
Real Property in the City of Yorba Linda, County of Orange, State of California, described as follows:
[Parcel 1 of Parcel Map No. 2024-159]
To be inserted before recordation
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EXHIBIT “B”
SITE PLAN
[Attached]
882
/009410-1018
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22554356.7 06/25/25 EXHIBIT “C”
EXHIBIT “C”
REQUEST FOR VERIFICATION OF PROPOSED BUYER
[Attached]
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REQUEST FOR VERIFICATION OF PROPOSED BUYER
THIS FORM MUST BE DELIVERED TO THE CITY BEFORE PROCEEDING WITH ANY TRANSFER OF AN AFFORDABLE UNIT.
Date: _________________
City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attn: Project Manager
Re: Request for Verification of Proposed Buyer
To Whom It May Concern:
Olson Urban VI – Yorba Linda 2, LLC, a Delaware limited liability company (“Project Owner”) desires to transfer the Affordable Unit located at _________________________________ (the “Property”) and by this letter is requesting the City to verify that the proposed buyer is a “Moderate Income Household” (as that term is defined in the Affordable Housing and Density Bonus Agreement and Declaration of Covenants, Conditions, and Restrictions, Including Resale Restrictions).
1. The Proposed Buyer is:
Name: _______________________________________________________ _______________________________________________________ _______________________________________________________ Current
Address:
_______________________________________________________ _______________________________________________________ _______________________________________________________ Telephone
Number:
_______________________________________________________
2. The terms of the proposed transfer are
(a) Sales price of $___________. This sales price is based on the lesser of _____(i) Fair market value; or
_____(ii) The maximum price which results in an Affordable Sales Price.
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IN ORDER TO ANSWER QUESTION 2(b) YOU MUST CALCULATE THE
PROPOSED SALES PRICE BASED ON THE HOUSING COST LIMITATIONS SET FORTH IN CALIFORNIA HEALTH & SAFETY CODE SECTION 50052.5, TAKING INTO
CONSIDERATION ALL ITEMS LISTED IN THE DEFINITION OF MONTHLY HOUSING COST.
(b) Price of any personal property being sold by Project Owner to the proposed buyer: $______________. (If none, so state.)
(c) The price of $____________ to be paid by the proposed buyer for any services of Project Owner. (If none, so state).
(d) All other amounts of money or other consideration, if any, concerning the Property or any other matter to be paid by the proposed buyer to Project Owner:
$__________. (If none, so state.)
(e) Sources of payment of sales price:
Sales price $___________
Cash down payment $___________
1st loan $___________
Total $___________
(f) The repayment terms for the 1st loan obtained by the proposed buyer to purchase the Property is as follows:
Monthly payments: $_____________
Taxes and assessments (1/12 of yearly taxes and
assessments):
$_____________
Insurance (1/12 of yearly premium): $______________
Homeowner’s dues: $______________
Total: $_______________
Interest rate ___________
Due date:
Points and fees: ____________
Lender:
_____________________________________________________________________
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Lender’s address: _______________________________________________________
3. The proposed buyer represents, warrants and covenants the following:
(a) The Property will be the principal residence of the proposed transferee, and will not be rented or leased.
(b) The combined maximum annual income for all household members of the proposed buyer is $___________. (This figure must include all sources of income.) (c) The proposed buyer will deliver to the City a signed financial statement, and supporting documentation, in a form acceptable to the City.
4. The proposed buyer’s household consists of the following persons who will reside in the Property:
Adults (18 or over) - [name of each]:
____________________________
____________________________
____________________________
Minors (under 18) [name of each]:
____________________________
____________________________
____________________________
5. In the event a transfer is made in violation of the terms of the Affordable Housing and Density Bonus Agreement and Declaration of Covenants, Conditions, and Restrictions (“Agreement”), or false or misleading statements are made in any documents or certificate submitted to City for its approval of the transfer, City shall have the right to file an action at law or in equity against the proposed buyer to seek to enforce the terms of the Agreement and/or force a sale of the Property and transfer of the Property to a Moderate Income Household.
A true and correct copy of the purchase and sale or other agreement between Project Owner and the proposed buyer is attached hereto. The transfer, if completed, shall be closed in accordance with the terms of the attached agreement. The attached agreement discloses all consideration to be delivered by the proposed buyer to Project Owner.
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I declare under penalty of perjury under the laws of the State of California that, as to the actual knowledge of Olson Urban VI – Yorba Linda 2, LLC, after diligentreview of all documents and other materials submitted to Olson Urban VI – Yorba Linda 2, LLC, but subject to the “Review Standard” (as defined in the Agreement), the foregoing is true and correct.
Executed at
, California
this day of
, 2026
“Developer”
OLSON URBAN VI – YORBA LINDA 2, LLC
a Delaware limited liability company
By: OLSON URBAN COMMUNITIES VI, LLC
a Delaware limited liability company
Sole Member
By: OLSON URBAN VENTURES VI, LLC
a Delaware limited liability company
Sole Member
By: OLSON URBAN HOUSING, LLC
a Delaware limited liability
company
Operating Member
By: IN TOWN LIVING, INC.
a Delaware corporation
Managing Member
By:_______________
Name: ____________
Title:______________
By:_______________
Name: ____________
Title:______________
I declare under penalty of perjury under the laws of the State of California that, as to the actual knowledge of the undersigned, after diligent review of all documents and other materials submitted to the undersigned, but subject to the “Review Standard” (as defined in the Agreement), the foregoing is true and correct.
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By: __________________________________
Printed Name: __________________________
Title: _________________________________
Lender Name: __________________________
_____________________________________
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I declare under penalty of perjury under the laws of the State of California that the foregoing, and all documents and materials submitted to City and Developer in order to make a determination that I am a Moderate Income Household, are true and correct, and that I intend to occupy the Affordable Unit as my principal place of residence.
PROPOSED BUYER:
________________________________
Date
________________________________
signature
________________________________
signature
________________________________
print name
________________________________
print name
____________________________________________________________________ street address telephone
____________________________________________________________________ city state zip code
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Project Owner/Mortgage Lender Certifications
Based on the Proposed Buyer’s Certificate above, and all documents attached hereto, Project Owner hereby certifies that, to the actual knowledge of Project Owner, after diligentreview of all documents and other materials submitted to Project Owner by the Proposed Buyer, but subject to the “Review Standard” (as defined in the Agreement):
(1) Proposed Buyer is a Moderate Income Household; and
(2) The purchase price to be paid by the Proposed Buyer is an Affordable Sales Price.
[Capitalized terms used above are defined in the Agreement to which this certificate is attached.]
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Executed at
, California
this day of
, 2026
“Developer”
OLSON URBAN VI – YORBA LINDA 2, LLC
a Delaware limited liability company
By: OLSON URBAN COMMUNITIES VI, LLC
a Delaware limited liability company
Sole Member
By: OLSON URBAN VENTURES VI, LLC
a Delaware limited liability company
Sole Member
By: OLSON URBAN HOUSING, LLC
a Delaware limited liability
company
Operating Member
By: IN TOWN LIVING, INC.
a Delaware corporation
Managing Member
By:_______________
Name: ____________
Title:______________
By:_______________
Name: ____________
Title:______________
Based on the Proposed Buyer’s Certificate above, and all documents attached hereto, Mortgage Lender hereby certifies that, to the actual knowledge of Mortgage Lender, after diligent review of all documents and other materials submitted to Mortgage Lender by the Proposed Buyer, but subject to the “Review Standard” (as defined in the Agreement):
(1) Proposed Buyer is a Moderate Income Household; and
(2) The purchase price to be paid by the Proposed Buyer is an Affordable Sales Price.
[Capitalized terms used above are defined in the Agreement to which this certificate is attached.].
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By: __________________________________
Printed Name: __________________________
Title: _________________________________
Lender Name: __________________________
The foregoing Proposed Buyer and Transfer is approved by City.
By: ______________________________________
Printed Name: ______________________________
Title: _____________________________________
882/009410-1018
22554356.7 06/25/25 EXHIBIT “D”
EXHIBIT “D”
CALCULATION OF AFFORDABLE SALES PRICE
[Attached]
882
/009410-1018
22554356.7 06/25/25 EXHIBIT “D” Page 456 of 1101
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attention: City Clerk
[Space above line for Recorder’s use]
[Exempt From Recording Fee Pursuant to Government Code § 27383]
AFFORDABLE HOUSING AGREEMENT WITH RESALE RESTRICTIONS
AND OPTION TO PURCHASE
This AFFORDABLE HOUSING AGREEMENT WITH RESALE RESTRICTIONS AND OPTION TO PURCHASE (the “Agreement”) is made this ____ day of ___________, by and between ___________________________ (“Participant”), and the CITY OF YORBA LINDA, a California municipal corporation (“City”).
R E C I T A L S
A. Participant has acquired fee title to a townhome condominium located at _________________________, in the City of Yorba Linda (“City”), California (the “Property”). The Property is more particularly described in Exhibit “A” attached hereto and incorporated herein by this reference.
B. The Property was developed by Olson Urban VI – Yorba Linda 2, LLC, a Delaware limited liability company (the “Project Developer”) as part of a forty (40) unit residential townhome condominium development (the “Project”).
C. The Property and the adjacent real property developed as part of the Project (collectively, the “Project Site”) is in City’s Residential Urban (R-U) zoning district and is in City’s Congregational Lands Overlay (CLO) Zone, which allows for a minimum of thirtyeight (38) units and a maximum of sixty-six (66) units to be developed on the Project Site and requires that a minimum of twenty percent (20%) of the units developed shall be offered to, and sold to low or moderate income households at an affordable housing cost.
D. Pursuant to the CLO Zone requirements, eight (8) of the residential units constructed by the Project Developer (the “Affordable Units”) are required to be restricted, for forty-five (45) years, for sale to and ownership and occupancy by households which qualify as “persons and families of moderate income” pursuant to Health and Safety Code section 50093 at an affordable sales price, as calculated and determined pursuant to the methodology set forth in Health and Safety Code section 50052.5 (the “Affordable Sales Price”).
E. Pursuant to the State of California’s Density Bonus Law (Government Code Section 65915 et seq.) (the “Density Bonus Law”), the Project qualified for a density bonus (which the Project Developer elected not to request). In connection with the Project
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Developer’s entitlement application, the Project Developer requested, under the Density Bonus Law, and City granted, the following waivers:
1. A waiver of development standards to allow an approximately 15- foot front yard setback where 20 feet is required.
2. A waiver of development standards to allow a 4-foot side yard interior setback where interior side yard setbacks are required to have a cumulative total of both side yards of 20 feet.
3. A waiver of development standards to allow a 4-foot 8-inch rear yard setback where 25 feet is required.
4. A waiver of development standards to allow a 7-foot minimum building separation where 10 feet is required.
5. A waiver of development standards to allow a 4-foot 8-inch setback to a single-family zone where 100 feet is required for 3-story structures.
6. A waiver of development standards to waive open space requirements.
7. A waiver of development standards to reduce the requirement to provide landscaping on a minimum of 50% of the building site area.
8. A waiver of development standards to allow three-story buildings adjacent to an arterial street where a one-story building height is the maximum allowed.
F. On _______, 2026, City and the Project Developer entered into that certain Affordable Housing and Density Bonus Agreement and Declaration of Covenants, Conditions, and Restrictions, which was recorded on ____, 2026, as Instrument No. ________ in the Official Records of Orange County (the “Declaration”). The Declaration designated the Property as one of the Affordable Units.
G. Participant represents and warrants to City that Participant has read and understands the terms and provisions of this Agreement and the covenants, conditions, and restrictions set forth in this Agreement, and that Participant has obtained the advice of independent legal counsel with respect to the terms of this Agreement, including all attachments hereto, or has knowingly and voluntarily waived the right to consult with legal counsel of his/her choosing.
H. Participant is an “Eligible Buyer” which, for purposes of this Agreement is a household (i) whose annual income does not exceed the qualifying limits under California law for “moderate-income households” as established by the United States Department of Housing and Urban Development, and as published periodically by the State of California Department of Housing and Community Development, and (ii) if the Property contains two (2) bedrooms, who at initial occupancy contains not less than two (2) persons.
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I. Participant represents and warrants to City that Participant shall reside in the Property as Participant’s principal residence at all times throughout the term of this Agreement.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing Recitals, which are incorporated herein by this reference and made a part hereof, and for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Duration of Covenants. The covenants set forth in this Agreement shall remain in effect from the date this Agreement is recorded and continue thereafter for a period of forty-five (45) years.
2. Property Transfer Restrictions.
a. Participant acknowledges that because the Project is located in the CLO Zone and obtained waivers pursuant to the Density Bonus Law, Participant was able to acquire the Property for a sales price substantially below the fair market value of the Property. As a result, except as expressly permitted in paragraph b of this Section 2, Participant shall not (i) sell, transfer assign, lease, or rent the Property or any portion of or estate in the Property, or (ii) obtain a mortgage or other loan (including the refinance of an existing loan), the repayment of which is secured by the Property (with any of the actions described in the foregoing clause (i) or (ii), a “Transfer”).
b. The following Transfers are permitted provided that Participant notifies City, in writing, prior to effecting the Transfer. (i) a transfer resulting from the death of Participant, (ii) a transfer by Participant where the spouse or domestic partner of Participant becomes a co-owner of the Property, (iii) a transfer of title to a spouse or domestic partner as part of divorce or dissolution proceedings, (iv) a transfer by Participant into a trust in which Participant is a beneficiary, provided that Participant continues to maintain the Property as Participant’s primary residence, (v) a transfer to an Eligible Buyer (provided City has made, or makes, a determination that the buyer qualifies as an Eligible Buyer in accordance with Section 4c below, and that the sales price constitutes an Affordable Sales Price in accordance with Section 4d below), (vi) a transfer by Participant of a nonpossessory interest in the Property, such as an easement or license for utilities or other like purposes, or a condemnation, or (vii) an “Approved Refinancing Mortgage” (as that term is defined in Section 12 below). c. Any Transfer that does not comply with the terms of this Section 2 is expressly prohibited by this Agreement and shall constitute a default of Participant under this Agreement, entitling City to purchase the Property from the new owner at an Affordable Sales Price pursuant to the process described in Section 4b below, as well as to exercise any remedies available at law or equity, including,
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without limitation, the enforcement of the liquidated damages provision in Section 16 of this Agreement.
3. Notice to City. Participant (or Participant’s heirs following the death of Participant) agrees to notify City in writing not less than thirty (30) days prior to any Transfer of any interest in the Property.
4. Sale of Property; City’s Option to Purchase.
a. If Participant desires to Transfer the Property, including by sale, quitclaim, exchange, or any other disposition of the Property (any of the foregoing, a “Proposed Sale”), Participant shall first notify City, at 4845 Casa Loma, Yorba Linda, CA 92886 of its intent to Transfer the Property, by sending to City the notification form attached hereto and incorporated herein as Exhibit”B” (“Participant’s Notice of Intent to Transfer”), at least ten (10) days prior to the date each time the Property is placed on the market for a Proposed Sale or Participant takes any other action to Transfer the Property or any interest therein. b. For a period of sixty (60) days commencing on the date City receives Participant’s Notice of Intent to Transfer (or, if Participant fails to send such notice, the date City discovers that Participant has placed the Property on the market or has taken any other action to Transfer the Property or any interest therein, City shall have an option to (A) purchase the Property from Participant at an “Affordable Sales Price” (as that term is defined in Section 4d below, and as determined pursuant to Section 4e below), or (B) to cause the purchase of all the Property by an Eligible Buyer at an Affordable Sales Price (“City’s Option to Purchase”).
City’s exercise of City’s Option to Purchase shall be made by delivery of written notice to Participant.
In the event City either purchases the Property or arranges the purchase by an Eligible Buyer, an escrow shall be established to close within forty-five (45) days after delivery of City’s notice of exercise (as applicable), subject to any extensions requested by City (as applicable) for causes outside the control of City.
In the event City arranges the purchase by an Eligible Buyer pursuant to this Section 4b, the Eligible Buyer shall be required to execute and record an assumption, release and consent agreement substantially in the form attached hereto and incorporated herein as Exhibit “C” (the “Assumption Agreement”), an Affordable Housing Disclosure Statement substantially in the form attached hereto and incorporated herein as Exhibit “D”, and a Subordination Agreement substantially in the form attached hereto and incorporated herein as Exhibit “E” (collectively, the “City Subsequent Buyer Documents”).
c. In the event City has failed to exercise City’s Option to Purchase within thesixty (60) day timeframe referenced in Section 4b above, and Participant desires to effect its own Transfer of the Property, the following restrictions shall apply:
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(1) Participant shall not Transfer the Property until such time as City has determined, (i) the proposed buyer is an Eligible Buyer; (ii) the proposed buyer intends to occupy the Property as its principal residence; and (iii) the Proposed Sale is at an “Affordable Sales Price” (as defined in Section 4d below). (2) If Participant identifies a proposed buyer whom Participant believes to be an Eligible Buyer, Participant shall cooperate with and reasonably assist City with the determination of whether the proposed buyer is an Eligible Buyer. Within ten (10) days after Participant locates the proposed buyer, Participant shall submit to City (1) information evidencing the proposed buyer’s identity and income in order that City may make a preliminary determination regarding the proposed buyer’s household income status (a “Preliminary Determination”); and (2) the price at which Participant proposes to sell the Property.
(3) In the event City makes a Preliminary Determination that the proposed buyer qualifies as an Eligible Buyer, Participant may proceed with opening an escrow for a Proposed Sale; provided, however, that not less than twenty (20) days prior to the date escrow is scheduled to close for the Proposed Sale, Participant shall, or shall cause the proposed buyer to, submit to City adequate information to enable City to make a final determination regarding whether the proposed buyer qualifies as an Eligible Buyer and whether the Property is available to such proposed buyer at an Affordable Sales Price (a “Final Determination”). Such information shall include (a) a completed Seller Checklist in the form attached hereto and incorporated herein as Exhibit “F”; (b) a completed Buyer Eligibility Application in the form attached hereto and incorporated herein as Exhibit “G”; and (c) the purchase and sale agreement pursuant to which Participant proposes to sell the Property to the proposed buyer. City may request additional information reasonably required to make a Final Determination regarding the proposed buyer’s status. In making a Final Determination regarding a proposed buyer, City shall apply the definition of “Gross Income” as set forth in 25 California Code of Regulations Section 6914 (“25 CCR Section 6914”). (4) If City is unable to make a Final Determination regarding the proposed buyer’s income as provided herein prior to the date set for the Proposed Sale, then the proposed buyer’s income shall be deemed to exceed the maximum allowable income limit for Eligible Buyer status and Participant may not conclude the Proposed Sale.
(5) Upon Participant’s sale of the Property to a household that qualifies as an Eligible Buyer (provided that person’s status as an Eligible Buyer has been determined by City pursuant to this Section 4c) at an Affordable Sales Price, the Eligible Buyer shall be required to execute a complete set of City Subsequent Buyer Documents.
IN THE EVENT PARTICIPANT SELLS THE PROPERTY TO
A BUYER WHO DOES NOT QUALIFY AS AN ELIGIBLE BUYER,
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CITY SHALL HAVE AN OPTION TO PURCHASE THE PROPERTY
FROM THE BUYER AT AN AFFORDABLE SALES PRICE
DETERMINED PURSUANT TO SECTION 4e BELOW.
THE FOREGOING CONSTITUTES NOTICE TO ANY
BUYER OF THE PROPERTY WHO HAS PURCHASED THE
PROPERTY WITHOUT OBTAINING THE PRIOR APPROVAL OF
CITY
d. As used herein, the term “Affordable Sales Price” shall be a purchase price which would result in an annual “Monthly Housing Cost”(as defined below) that does not exceed the maximum percentage of income that can be devoted to housing cost by an Eligible Buyer, under California Health and Safety Code Section 50052.5 or successor statute. As of the date of this Agreement, the Affordable Sales Price for an Eligible Buyer means a purchase price with a reasonable downpayment, and that would result in an annual Monthly Housing Cost that is (a) not less than twenty-eight percent (28%) of the gross income of the Eligible Buyer, and (b) not more than the product of thirty-five percent (35%) times one hundred ten percent (110%) of the Orange County area median income adjusted for family size appropriate for the Property, or, for any Eligible Buyer that has a gross income that exceeds one hundred ten percent (110%) of the Orange County area median income adjusted for family size, the annual Monthly Housing Cost may not exceed thirty-five percent (35%) of the gross income of the Eligible Buyer, all as more particularly set forth in Section 50052.5 of the California Health and Safety Code. For purposes of determining an Affordable Sales Price, a “reasonable” downpayment is a downpayment that equals five percent (5%) of the sales price for the Affordable Unit. A sample Affordable Sales Price calculation is attached hereto and incorporated herein as Exhibit “H”. “Monthly Housing Cost” shall be a cost that includes all of the following associated with the Property, estimated or known as of the date of the Proposed Sale of the Property:
(1) Principal and interest payments on a thirty-year fixed mortgage loan and any loan insurance fees associated therewith. (2) Property taxes and assessments.
(3) Flood insurance, if required by the holder of the “Primary Mortgage Deed of Trust” (as that term is defined in Section 11 below) or the Project’s covenants, conditions and restrictions.
(4) Fire and casualty insurance covering replacement value of property improvements, unless such insurance is procured by the homeowner association for the Project.
(5) Any homeowner association fees.
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(6) A reasonable utility allowance.
(7) The lease cost incurred for solar panels.
The Monthly Housing Cost of a buyer shall be an average of estimated costs for the next twelve (12) months.
For purposes of this Agreement, the term “adjusted for family size appropriate to the Property” shall mean a household of two (2) persons in the case of a one-bedroom unit and three (3) persons in the case of a two-bedroom unit.
Concurrent with the notice of a proposed Transfer of the Property, Participant shall request from the City a determination of the then current Affordable Sales Price. This determination shall remain in effect for ninety (90) days. For purposes of determining if a proposed sales price constitutes an Affordable Sales Price, the proposed sales price shall mean and refer to the total compensation to be received by Participant in connection with said sale.
PARTICIPANT UNDERSTANDS THAT THE DETERMINATION OF THE
AFFORDABLE SALES PRICE CAN BE MADE ONLY AT THE TIME OF THE
PROPOSED SALE, AND THAT THE AFFORDABLE SALES PRICE PERMITTED
HEREUNDER MAY BE LESS THAN THE FAIR MARKET VALUE OF THE PROPERTY
AND MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS OTHER
SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THE AFFORDABILITY COVENANTS IN THIS AGREEMENT. PARTICIPANT FURTHER ACKNOWLEDGES
THAT IN SETTING THE AFFORDABLE SALES PRICE, THE PRIMARY OBJECTIVE OF
CITY AND THIS AGREEMENT IS TO PROVIDE HOUSING TO ELIGIBLE BUYERS AT AN AFFORDABLE SALES PRICE.
PARTICIPANT’S INITIALS
e. In the event City exercises City’s Option to Purchase, the Affordable Sales Price shall be determined based upon (i) a five percent (5%) down payment; (ii) a thirty-year fully amortizing fixed interest rate mortgage at the then-prevailing home mortgage rate for Orange County, California, as set forth on the FreddieMac website or, if the aforementioned website is no longer available or no longer provides home mortgage rates for Orange County, at the rate available from a reputable institutional lender reasonably selected by City; and (iii) based on the allowable Monthly Housing Cost at the time of City’s purchase. f. In the event Participant sells or otherwise Transfers the Property in violation of the terms of this Agreement or false or misleading statements are made in any documents or certificate submitted to City for its approval of the sale or other Transfer of the Property, City shall have the right to file an action at law or in equity against Participant and/or the proposed buyer to seek to enforce the terms of this Agreement and/or force a sale of the Property to an Eligible Buyer.
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5. City Provision of Tax Records. Participant acknowledges that in the event City is audited, City may be required to submit the financial information, including tax records, of Participant that were utilized by City to determine Participant’s eligibility to purchase the Property. City shall have no liability to Participant for any damage or injury suffered by Participant as a result of such submittal by City and Participant hereby waives and releases any such rights or claims it may otherwise have at law or at equity.
Participant acknowledges that it is aware of the meaning and legal effect of California Civil Code section 1542, which provides:
A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party
____________________________
Participant’s initials
6. Maintenance of Property. Participant shall maintain the improvements and landscaping on the Property (other than those improvements or landscaping maintained by the homeowner’s association for the Property) in a manner consistent with community standards which will uphold the value of the Property, in accordance with the Yorba Lunda Municipal Code. Participant also agrees to comply with any applicable declaration of covenants, conditions, and restrictions recorded against the Project, or portions thereof, and all applicable federal, state and local laws and regulations.
7. Occupancy Standards and Requirements.
a. The Property shall be used as the principal residence of Participant and for no other purpose.
b. Participant shall not enter into an agreement for the rental or lease of the Property, or any portion thereof, or permit the rental of lease of the Property, or any portion thereof.
c. The maximum occupancy of the Property shall be two (2) persons per bedroom, plus one (1) person (i.e., for a two bedroom property, the maximum occupancy is 5 persons).
d. Participant shall, upon demand by City, submit to City an affidavit of occupancy verifying Participant’s compliance with this Section 7. Said affidavit may be required by City on an annual basis.
e. City may grant a temporary waiver of the above requirements for good cause, in City’s sole and absolute discretion.
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8. City Administrator. City may contract with a consultant or other person or entity (the “Administrator”) to carry out City’s obligations under this Agreement. Any reference to the duties of City herein shall also apply to the Administrator.
9. Income and Asset Information. Participant has submitted an application and additional information verifying income and asset eligibility to City prior to execution of this Agreement. Participant represents, warrants and declares under penalty of perjury to City that all information Participant has provided and will provide in the future to City is and will be true, correct and complete. Participant acknowledges that City is relying upon Participant’s representations that Participant is an Eligible Buyer, and City would not have entered into this Agreement if Participant did not so qualify. Asset eligibility shall be determined pursuant to the definition of Gross Income as set forth in 25 CCR Section 6914, as it may be amended from time to time.
10. Participant Financing. Participant shall obtain financing for the purchase of the Property (a “Primary Mortgage”) from an institutional third party lender reasonably approved by City (the “Lender”). Participant hereby acknowledges that Participant must make a down payment of not less than five percent (5%) and not more than twenty percent (20%) of the purchase price for the Property in connection with the Lender’s financing. A minimum of five percent (5%) of Participant's down payment shall be provided from Participant's own funds (i.e., not gifted or loaned funds). Nothing in this Agreement shall be construed as a promise or guaranty by City that Participant will qualify for or receive a Primary Mortgage from a Lender.
11. Order of Recordation; Request for Notice. Participant agrees it shall instruct the escrow agent for acquisition of the Property by Participant that the order of recording in the escrow for the purchase of the Property by Participant shall occur as follows: 1) the Grant Deed transferring the Property to Participant; 2) this Agreement; 3) the deed of trust securing the Primary Mortgage (the “Primary Mortgage Deed of Trust”); 4) a deed of trust in favor of City, securing Participant’s obligations under this Agreement (the “City Deed of Trust”); and 5) a subordination agreement pursuant to which (a) the Primary Mortgage Deed of Trust shall be subordinated to this Agreement, and (b) the City Deed of Trust shall be subordinated to the Primary Mortgage Deed of Trust.
Participant shall cause a Request for Notice to be recorded on the Property subsequent to the recordation of the Primary Mortgage Deed of Trust requesting a statutory notice of default as set forth in the California Civil Code Section 2924(b). Such notice shall be sent to: City of Yorba Linda, 4845 Casa Loma, Yorba Linda, CA 92886, Attention: City Manager.
12. Approved Refinancing Mortgage. Notwithstanding anything to the contrary in Section 2 above, Participant shall be permitted to refinance the Primary Mortgage Deed of Trust, provided the replacement mortgage constitutes an “Approved Refinancing Mortgage,” which for purposes of this Agreement shall mean a thirty (30) year fully amortizing fixed interest rate mortgage that replaces Participant’s existing thirty (30) year fixed primary mortgage, and conforms to one of the following: (i) the principal
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balance of the mortgage does not exceed the sum of the then-current outstanding principal balance owed on Participant’s existing thirty (30) year fixed primary mortgage and reasonable closing costs, (ii) the principal balance of the mortgage exceeds the sum of the outstanding balance owed on Participant’s existing thirty (30) year fixed primary mortgage and reasonable closing costs by not more than Twenty-Five Thousand Dollars ($25,000), and has been approved by the Community Development Director of City, in his or her reasonable discretion, or (iii) the principal balance of the mortgage exceeds the sum of the outstanding balance owed on Participant’s existing thirty (30) year fixed primary mortgage and reasonable closing costs by more than Twenty-Five Thousand Dollars ($25,000), and has been approved by the City Council of City, in its sole and absolute discretion.
13. Foreclosure Sale not a Violation of this Agreement. Notwithstanding the requirements hereunder that the Property must be continuously occupied by an Eligible Buyer as the Eligible Buyer’s principal residence, a foreclosure, trustee’s sale, deed in lieu of foreclosure, or other proceeding or transaction under the Primary Mortgage Deed of Trust shall not constitute a default hereunder provided the purchaser of the Property at such sale either (i) qualifies as an Eligible Buyer, executes a complete set of City Subsequent Buyer Documents, and thereafter occupies the Property as the household’s principal residence; or (ii) sells the Property to an Eligible Buyer at the Affordable Sales Price within one hundred eighty (180) days after the conclusion of said sale and said Eligible Buyer executes a complete set of City Subsequent Buyer Documents, and thereafter occupies the Property as the Eligible Buyer’s principal residence.
14. Indemnification. Participant shall defend, indemnify and hold harmless City and City’s officers, officials, agents, members, employees, representatives, and volunteers from and against any loss, liability, claim, or judgment relating in any manner to the Property or this Agreement. Participant shall remain fully obligated for the payment of taxes, liens and assessments related to the Property.
15. Defaults. Failure or delay by either party to perform any term or provision of this Agreement which is not cured within thirty (30) days after receipt of notice from the other party constitutes a default under this Agreement; provided, however, if such default is of the nature requiring more than thirty (30) days to cure, the defaulting party shall avoid default hereunder by commencing to cure within such thirty (30) day period, and thereafter diligently pursuing such cure to completion.
The injured party shall give written notice of default to the party in default, specifying the default complained of by the injured party. Except as required to protect against further damages, the injured party may not institute proceedings against the party in default until thirty (30) days after giving such notice (or such larger period as described in the immediately preceding sentence). Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default.
In addition to any other legal or equitable remedy available to City, in the event of a material default by Participant that has not been timely cured, City shall be entitled to
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exercise City’s Option to Purchase, provided that City’s sixty (60) day period to exercise City’s Option to Purchase shall commence upon the expiration of the cure period provided to Participant pursuant to this Section 15.
16. Liquidated Damages for Prohibited Transfer. In the event City seeks monetary damages for a Prohibited Transfer, Participant shall be required, to the extent permitted by law, to pay to City the entire amount of the “Sale Price” (as defined below) received in excess of the Affordable Sales Price permitted pursuant to this Agreement; provided, however, that nothing herein shall be deemed to limit City’s remedy for a Prohibited Transfer to seeking monetary damages, and City shall be entitled to pursue any other equitable remedy permitted by law, including specific performance or injunctive relief, to prevent a Prohibited Transfer. For purposes of this Section 16, the “Sale Price” is the price to be paid by the buyer of the Property to Participant for Participant’s interest in the Property, less repayment of the “Primary Note” (as that term is defined in Section 17 below), and after deduction of escrow fees, recording fees, transfer taxes, title insurance costs, broker’s commissions, loan fees or any other closing or transaction costs paid by Participant (other than Participant’s share of property taxes that are paid at the close of escrow).
THE PARTIES HERETO AGREE THAT THE AMOUNT SET FORTH IN THIS SECTION 16 (THE “DAMAGE AMOUNT”) CONSTITUTES A REASONABLE
APPROXIMATION OF THE ACTUAL DAMAGES THAT CITY WOULD SUFFER DUE TO THE DEFAULTS BY PARTICIPANT SET FORTH IN THIS SECTION 16, CONSIDERING
ALL OF THE CIRCUMSTANCES EXISTING ON THE EFFECTIVE DATE OF THIS
AGREEMENT, INCLUDING THE RELATIONSHIP OF THE DAMAGE AMOUNTS TO THE RANGE OF HARM TO CITY AND ACCOMPLISHMENT OF CITY’S PURPOSE OF
ASSISTING IN THE PROVISION OF AFFORDABLE HOUSING TO ELIGIBLE BUYERS
THAT REASONABLY COULD BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL DAMAGES WOULD BE COSTLY OR INCONVENIENT. THE DAMAGE AMOUNT SET FORTH IN THIS SECTION 16 SHALL BE THE SOLE DAMAGES REMEDY FOR THE DEFAULTS SET FORTH IN THIS SECTION 16, BUT NOTHING IN THIS SECTION 16 SHALL BE INTERPRETED TO LIMIT CITY’S REMEDY FOR SUCH DEFAULT TO DAMAGES. IN PLACING ITS INITIALS AT THE PLACES
PROVIDED HEREINBELOW, EACH PARTY SPECIFICALLY CONFIRMS THE
ACCURACY OF THE STATEMENTS MADE ABOVE AND THE FACT THAT EACH
PARTY HAS BEEN REPRESENTED BY COUNSEL OR HAS HAD THE OPPORTUNITY
TO BE REPRESENTED BY COUNSEL TO EXPLAIN THE CONSEQUENCES OF THE
LIQUIDATED DAMAGES PROVISION AT OR PRIOR TO THE TIME EACH EXECUTED THIS AGREEMENT.
PARTICIPANT’S INITIALS: ___________ CITY’S INITIALS: ___________ Notwithstanding any of the above, nothing herein is intended to preclude City’s recovery of its reasonable attorney’s fees and costs incurred to enforce this Section 16, as provided in Section 30 below.
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17. Distribution of Insurance and Condemnation Proceeds. In the event the improvements on the Property are destroyed and insurance proceeds are distributed to Participant instead of being used to rebuild such improvements, or in the event of condemnation of the Property, if proceeds thereof are distributed to Participant, such proceeds (the “Proceeds”) shall be paid and distributed as follows: (i) first, to the Lender or the holder of the note secured by the Primary Mortgage Deed of Trust (the “Primary Note”), to pay the remaining balance owed thereon (the “Primary Note Balance”), (ii) second, to the extent Proceeds remain, the difference between the Affordable Sales Price, calculated pursuant to Section 4(d) above, and the Primary Note Balance, shall be distributed to Participant, and (iii) third, to the extent Proceeds remain, all such remaining Proceeds shall be distributed to City.
18. Covenant to Keep Property Drug Free. Participant represents and covenants to City that (i) Participant shall maintain a drug free environment on the Property, and (ii) Participant and all persons residing on the Property shall not unlawfully manufacture, distribute, dispense, possess or use controlled substances, as said term is defined in 21 United States Code Section 812 and California Health and Safety Code Section 11007, including, without limitation, heroin, cocaine, and amphetamines on the Property. If Participant or any person residing on the Property is convicted, or pleads guilty or nolo contendere to a charge of unlawfully manufacturing, distributing, dispensing, possessing or using controlled substances on the Property, then such event shall be deemed a default under this Agreement, which shall entitle City to exercise City’s Option to Purchase within sixty (60) days of City’s notice of said default.
19. 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 either party of one or more of its 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 the other party.
20. Covenants to Run with the Land. All conditions, covenants, and restrictions contained in this Agreement shall be covenants running with the land, and shall, in any event, and without regard to technical classification or designation, legal or otherwise, be, to the fullest extent permitted by law and equity, binding for the benefit and in favor of, and enforceable by, City and City’s successors and assigns, against Participant, its successors and assigns, to or of the Property or any portion thereof or any interest therein, and any party in possession or occupancy of said Property or portion thereof.
In amplification and not in restriction of the provisions set forth hereinabove, it is intended and agreed that City shall be deemed a beneficiary of the agreements and covenants provided hereinabove both for and in its own right and also for the purposes of protecting the interests of the community. All covenants without regard to technical classification or designation shall be binding for the benefit of City and such covenants shall run in favor of City for the entire period during which such covenants shall be in force and effect, without regard to whether City is or remains an owner of any land or interest therein to which such covenants relate. City shall have the right, in the event of any
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breach of any such agreement or covenant, to exercise all the rights and remedies, and to maintain any action at law or suit in equity or other proper proceedings to enforce the curing of such breach of agreement or covenant.
21. Non-Waiver. Failure to exercise any right City may have or be entitled to, in the event of default hereunder, shall not constitute a waiver of such right or any other right in the event of a subsequent default.
22. Recordation; Other Documents. Participant agrees and acknowledges that this Agreement shall be recorded against the Property with the County Recorder of the County of Orange and shall appear of record with respect to and as an encumbrance to the Property. Participant agrees to execute any other documents reasonably required by City to complete the transaction contemplated hereby.
23. Further Assurances. Participant shall execute any further documents consistent with the terms of this Agreement, including documents in recordable form, as City shall from time to time find necessary or appropriate to effectuate its purposes in entering into this Agreement.
24. Governing Law. Participant hereby agrees to comply with all ordinances, rules and regulations of City. Nothing in this Agreement is intended to be, nor shall it be deemed to be, a waiver of any City ordinance, rule or regulation. This Agreement shall be governed by the laws of the State of California. Any legal action brought under this Agreement must be instituted in the Superior Court of the County of Orange, State of California, or in the Federal District Court in the District of California in which Orange County is located.
25. Amendment to Agreement. No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be made except by a written agreement executed by Participant and City.
26. City May Assign. City may, at its option and without obtaining the consent of the Participant, assign this Agreement.
27. Participant Assignment Prohibited. In no event shall Participant assign or transfer any portion of this Agreement or any of the other agreements referred to herein without the prior express written consent of City. Any such assignment or transfer without the prior express written consent of City shall be null and void.
28. Relationship of Participant and City. The relationship of Participant and City pursuant to this Agreement is that of debtor and creditor and shall not be or be construed to be a joint venture, equity venture, partnership, or other relationship.
29. Notices. Any notices, requests or approvals given under this Agreement from one party to another may be personally delivered, delivered by reputable same-day or overnight courier that provides a receipt with the date and time of delivery, or deposited with the United States Postal Service for mailing, postage prepaid, registered or certified mail, return receipt requested to the following address:
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To Participant:
____________________
____________________
____________________
To City: City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attention: City Manager
Either party may change its address for notice by giving written notice thereof to the other party.
30. Attorneys’ Fees and Costs. In the event that any action is instituted to enforce payment or performance under this Agreement, the parties agree the nonprevailing party shall be responsible for and shall pay all costs, including expert witness fees, and all reasonable attorneys’ fees incurred by such prevailing party in enforcing this Agreement.
31. Recording and Priority of Agreement. Upon complete execution and notarizing of this Agreement, City shall cause this Agreement to be recorded against the Property in the Orange County Recorder’s Office. This Agreement shall be recorded prior to the recording of any deed of trust, including, without limitation, the Primary Mortgage Deed of Trust, and shall have priority over and shall not be made subordinate to any mortgage, deed of trust, or other encumbrance recorded against the Property, including, without limitation, the Primary Mortgage Deed of Trust and lien of any Approved Refinancing Mortgage.
32. Nondiscrimination. Participant 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 any basis listed in subdivision (a) or (d) of Section 12955 of the California 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 California Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, or any part thereof, nor shall Participant, 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, subtenants, sublessees or vendees of the Property, or any part thereof. The foregoing covenants shall run with the land.
The covenants established in this Agreement shall, without regard to technical classification and designation, be binding for the benefit and in favor of City and City’s successors and assigns. The covenants against discrimination shall remain in effect in perpetuity.
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Notwithstanding the foregoing, the Participant acknowledges and agrees that during Participant’s ownership of the Property, Participant shall occupy the Property as Participant’s principal residence and shall not rent or lease the Property.
33. Entire Agreement. This Agreement, together with all attachments hereto, constitutes the entire understanding and agreement of the parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental thereto, and supersedes all prior negotiations, discussions and previous agreements between Cityand Participant concerning all or any part of the subject matter of this Agreement.
34. Authority. Each signatory hereto warrants to the other party that it has authority to sign on behalf of the party for whom it purports to sign.
35. Non-Liability of Officers and Employees. No officer, official, member, employee, agent, or representative of City shall be personally liable to Participant, or any successor or assign of same, in the event of any default or breach by City, or for any amount which may become due to Participant, or any successor or assign of same, or for breach of any obligation of the terms of this Agreement.
36. Time of Essence. Time is of the essence of every portion of this Agreement in which time is a material part.
37. Interpretation; Severability. The terms of this Agreement shall be construed in accordance with the meaning of the language used and shall not be construed for or against either party hereto by reason of the authorship of this Agreement or any other rule of construction which might otherwise apply. The Section headings are for purposes of convenience only, and shall not be construed to limit or extend the meaning of this Agreement. Each provision of this Agreement shall be severable from the whole. If any provision of this Agreement shall be found contrary to law, the remainder of this Agreement shall continue in full force.
38. Integration; Amendment. It is understood that there are no oral agreements between the parties hereto affecting this Agreement, and this Agreement supersedes and cancels any and all previous negotiations, arrangements, agreements, and understandings, if any, between the parties with respect to the subject matter hereof, and none shall be used to interpret this Agreement. This Agreement may be amended at any time by the mutual consent of the parties by an instrument in writing.
39. Counterparts. This Agreement may be executed in counterparts, each of which, when this Agreement has been signed by each of the parties hereto, shall be deemed to be an original.
[Signatures on next page]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year written below.
Date: _________________
“Participant”
___________________________
By:
By: _________________________________
Date: __________________
“City”
CITY OF YORBA LINDA, a California
municipal corporation
By:
Peter Grant, City Manager
ATTEST:
Marcia Brown, City Clerk
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
Todd O. Litfin, City Attorney
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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 )
County of ______________________ )
On _________________________, before me, , (insert name and title of the officer) 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 (Seal)
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 )
County of ______________________ )
On _________________________, before me, , (insert name and title of the officer) 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 (Seal)
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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 )
County of ______________________ )
On _________________________, before me, , (insert name and title of the officer) 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 (Seal)
882/009410-1018
23556819.5 a04/13/26 Exhibit “A”
EXHIBIT “A”
LEGAL DESCRIPTION OF THE PROPERTY
That certain real property located in the City of Yorba Linda, County of Orange, State of California and described as follows:
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Exhibit “B”
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EXHIBIT “B”
NOTICE OF INTENT TO TRANSFER
[See attached]
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Exhibit “B”
-2-
NOTICE OF INTENT TO TRANSFER
NOTICE OF INTENT TO TRANSFER MUST BE DELIVERED
TO THE CITY OF YORBA LINDA PRIOR TO PLACING THE
PROPERTY ON THE MARKET OR PROCEEDING WITH
ANY TRANSFER OF THE PROPERTY.
From: ______________________________ (“Owner”)
To: City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attention: City Manager
Re:
____________________
____________________
(the “Property”)
Owner desires to [sell, convey, or otherwise transfer] (circle appropriate words) (“Transfer”) the Property.
Owner understands that Owner may not Transfer the Property until the City of Yorba Linda(“City”) has determined that (i) the proposed buyer is an “Eligible Buyer,” and (ii) the proposed sales price is an “Affordable Sales Price”, as those terms are defined in the Affordable Housing Agreement with Resale Restrictions and Option to Purchase Owner entered into with City in connection with Owner’s purchase of the Property (“Agreement”).
To determine if a proposed buyer is an Eligible Buyer and if a sales price is an Affordable Sales Price, Owner must submit to City a complete Seller Checklist in the form attached as Exhibit “F” to the Agreement, and a complete Buyer Eligibility Application in the form attached as Exhibit “G” to the Agreement (“Buyer Application”). Owner is instructed to contact City for assistance in completing the Seller Checklist and Buyer Application.
Date: _________________ ________________________________ Signature of Owner
________________________________
Printed name of Owner
(___) ___________________________
Day time telephone of Owner
(___)____________________________
Cell phone number of Owner
_________________________________
E-mail address of Owner
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Exhibit “B”
-3-
[Signatures continued on next page]
Date: _________________ ________________________________ Signature of Owner
________________________________
Printed name of Owner
(___) ___________________________
Day time telephone of Owner
(___)____________________________
Cell phone number of Owner
_________________________________
E-mail address of Owner
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Exhibit “C”
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EXHIBIT “C”
ASSUMPTION AGREEMENT
[See attached]
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Exhibit “C”
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attention: City Clerk
(Space above for Recorder’s use)
(Exempt from Recording Fee Per Gov. Code § 27383)
ASSUMPTION, RELEASE, AND CONSENT AGREEMENT
This ASSUMPTION, RELEASE, AND CONSENT AGREEMENT (“Agreement”), is made as of _________________________, by and between CITY OF YORBA LINDA, a California municipal corporation (“City”), and ___________________________ (“Participant”).
W I T N E S S E T H:
A. Participant has acquired or is about to acquire fee title to that certain real property located in the City of Yorba Linda, County of Orange, State of California described in Exhibit “A” attached hereto and made a part hereof (the “Property”).
B. On or about _____________________, City and
________________________ (the “Original Participant”), the original owner of the Property, entered into that certain Affordable Housing Agreement with Resale Restrictions and Option to Purchase (the “AHA”), which was recorded against the Property on ____________________, as Instrument No. ______________, in the Official Records of the County of Orange (the “Official Records”). Among other terms, the AHA imposes affordability covenants on the Property that require that throughout the term thereof the Property be owned by an income-qualified household that occupies the Property as its principal place of residence.
C. In connection with the Original Participant’s purchase of the Property, the Original Participantexecuted that certain Deed of Trust securing the Original Participant’s repayment of certain sums to City if such sums become due and the Original Participant’s performance under the AHA (the “City Deed of Trust”). The City Deed of Trust was recorded against the Property on _____________________, as Instrument No. _________________, in the Official Records.
D. Participant has met all of City’s requirements to acquire and own the Property. City is willing to consent to the acquisition and ownership, provided Participant assumes all of the Original Participant’sobligations under the AHAand City Deed of Trust (collectively, the “City Documents and Agreements”).
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Exhibit “C”
-3-
NOW THEREFORE, City and Participant agree as follows:
1. Assumption by Participant. As of the Effective Date, Participant(i) assumes and agrees to pay and to perform all of the obligations of the Original Participant under the City Documents and Agreements, and further agrees to be bound by all of the terms, provisions and conditions contained in the City Documents and Agreements as though Participant had originally made, executed and delivered same to City; and (ii) reaffirms and restates all of the representations, warranties, covenants and indemnities of the Original Participantcontained in the City Documents and Agreements with the same force and effect as if each were separately stated herein and made as of the date hereof.
2. Consent and Recognition by City. As of the Effective Date, City (i) consents to the acquisition and ownership of the Property by Participant, and (ii) recognizes that Participant has all of the rights of the Original Participant under the City Documents and Agreements. Such consent by City shall not constitute a consent to any further or subsequent sale, conveyance or transfer by Participant of the Property, or any part thereof, or any interest therein.
3. Release of Original Participant. City hereby releases the Original Participant from any and all liabilities and obligations under the City Documents and Agreements, and agrees that it will not institute any action, suit, claim or demand in law or equity against the Original Participant for or on account of the Original Participant’s personal liability and obligations under the City Documents and Agreements.
4. Conditions Precedent. Before this Agreement becomes effective and any party becomes obligated under it, all of the following conditions shall have been satisfied, at no cost to City, and in a manner acceptable to City in the exercise of City's sole judgment:
A. Execution of this Agreement. Participant shall have executed, with signature(s) notarized, and delivered to City this Agreement.
B. Deed of Conveyance. A grant deed effectuating the transfer of the Property to Participant shall have been duly executed by then-owner of the Property, with signature(s) notarized, and recorded in the Official Records.
The date on which all of the conditions set forth in this Section 4 have been satisfied in the manner described above shall be referred to as the “Effective Date.”
5. Legal Effect. Except as modified by this Agreement, the City Documents and Agreements are unchanged and, as so modified, the City Documents and Agreements shall remain in full force and effect and are hereby ratified and reaffirmed by Participant.
6. Obligations Joint and Several. If Participant is comprised of more than one individual or entity, then the obligations of each such individual or entity under this Agreement and under the City Documents and Agreements shall be joint and several.
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Exhibit “C”
-4-
7. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto as well as their respective heirs, executors, administrators, successors and assigns.
8. Governing Jurisdiction. This Agreement shall be governed by and construed in accordance with the internal laws of the State of California.
9. Attorneys' Fees. If any lawsuit, arbitration or other proceeding is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover the reasonable fees and costs of its attorneys in such proceeding.
10. Entire Agreement. This Agreement contains the entire agreement between City and Participant with respect to the subject matter hereof and supersedes all prior agreements, understandings, offers and negotiations, oral or written, with respect thereto.
11. Counterparts. This Agreement may be executed in counterparts, each of which, when this Agreement has been signed by each of the parties hereto, shall be deemed to be an original.
IN WITNESS WHEREOF, City and Participant have executed this Agreement as of the date first hereinabove written.
CITY OF YORBA LINDA,
a California municipal corporation
By: _______________________________
Peter Grant, City Manager
PARTICIPANT
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Exhibit “C”
-5-
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 )
County of Orange )
On _________________________, before me, , (insert name and title of the officer) 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 (Seal)
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Exhibit “C”
-6-
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 )
County of Orange )
On _________________________, before me, , (insert name and title of the officer) 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 (Seal)
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Exhibit “C”
-7-
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 )
County of Orange )
On _________________________, before me, , (insert name and title of the officer) 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 (Seal)
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Exhibit “C”
-8-
EXHIBIT “A”
LEGAL DESCRIPTION
That certain real property located in the City of Yorba Linda, County of Orange, State of California described as follows
.
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Exhibit “D”
-1-
EXHIBIT “D”
AFFORDABLE HOUSING DISCLOSURE STATEMENT
[See attached]
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Exhibit “D”
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AFFORDABLE HOUSING DISCLOSURE STATEMENT
Name of
Participant(s):
____________________________________________________
Property Address: ____________________________________________________ Purchase Price: $________________
I/we _________________________ (the “Participant”) am/are purchasing the above described property (the “Property”). I/we understand that to (i) satisfy certain zoning requirements applicable to the Property, and (ii) obtain, under the California Density Bonus Law, waivers of certain City of Yorba Linda (“City”) development standards for the residential development project in which the Property is a part (the “Project”), the developer of the Property was required to restrict the Property as an affordable housing unit. I/we understand that the affordability restrictions imposed on the Property enabled me/us to purchase the Property at the purchase price listed above (the “Purchase Price”), which is less than the market price for the Property.
I/we understand that our ability to purchase the Property is conditioned on a number of factors, including, but not limited to:
• I/we understand that the original buyers of the Property signed an Affordable Housing Agreement with Resale Restrictions and Option to Purchase (“City Affordable Housing Agreement”), and that in connection with my/our purchase, I/we have signed or will sign an Assumption, Release, and Consent Agreement (“Assumption Agreement”), in which I/we have assumed and agreed to be bound by all of the terms and requirements of the City Affordable Housing Agreement.
• I/we have read or had explained to us the terms and conditions of the City Affordable Housing Agreement. I/we understand that the City Affordable Housing Agreement imposes binding legal obligations on me/us. • I/we understand that if I/we attempt to sell the Property to a household that does not qualify under California law as a person or family of moderate income (an “Eligible Buyer”) or if I/we attempt to sell the Property at a price that exceeds a sale price that is affordable to an Eligible Buyer under California law (an “Affordable Sales Price”), the City may pursue all available remedies against me/us, including an action to stop a sale or to force a sale to an Eligible Buyer, or I/we may be required to pay to City a penalty that equals the difference between the sales price for the Property and an Affordable Sales Price (the “Damage Amount”).
• I/we understand that the original buyers of the Property also signed a Deed of Trust that I/we have assumed pursuant to the Assumption Agreement
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Exhibit “D”
-3-
that secures (i) my/our obligation to pay the Damage Amount to the City and the City’s legal fees and costs if any of such amounts become due under the City Affordable Housing Agreement, and (ii) my/our compliance with the City Affordable Housing Agreement.
• I/we understand that the City Affordable Housing Agreement contains an option to purchase that may be exercised by City to purchase the Property at an Affordable Sales Price in the following situations:
during the period after I/we notify City of my/our desire to sell the Property or I/we place the Property for sale (whichever occurs first), for a minimum of 60 days, and up until the time I/we enter into an agreement to sell the Property to an Eligible Buyer; or
upon my/our sale of the Property to a buyer who does not qualify as an Eligible Buyer, or any other material default that has not been cured after written notice and an opportunity to cure, including, but not limited to, my/our failure to live in the Property as my/our principal residence.
• I/we understand that the City Affordable Housing Agreement will remain in effect for a period of forty-five (45) years.
• I/we understand that I/we must qualify as “persons and families of moderate income” under California law.
• I/we understand that my/our monthly payments for housing expenses may not be less than 28% of my/our gross household income, nor exceed the product of 35% times 110% of the Orange County area median income adjusted for family size appropriate for the Property, as more specifically defined by Health and Safety Code Section 50052.5.
• I/we understand that during my/our ownership of the Property, I/we must continuously occupy the Property and I/we shall not rent or lease any part of the Property.
• I/we understand that on an annual basis during my/our ownership of the Property, I/we must sign a certification declaring, under penalty of perjury, that I/we have continuously occupied, and continue to occupy, the Property. • I/we understand that on an annual basis during my/our ownership of the Property, we must provide to the City copies of the following documents evidencing our continued occupancy of the Property: (i) two utility bills or other similar documentation, and (ii) a valid California Driver’s License, California Identification Card, or photo ID of similar status.
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Exhibit “D”
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• I/we understand that City shall not be held responsible for any costs associated with the home I/we purchase including, but not limited to, any loan fees or charges, any charges for appraisals or any escrow costs or other costs relating to the transfer of the Property.
• I/we understand that City cannot ensure that information provided by or on my/our behalf will be kept confidential.
• I/we understand that City shall not be responsible for providing information concerning any public or private sources of loans.
• I/we understand that all loans and funding requests must be approved by the City Manager of City. Therefore, a minimum 30 day escrow may be necessary.
“Participant”
By:
Printed Name: ______________________
By: _________________________________
Printed Name: ______________________
Date: _____________________
Date: _____________________
* * *
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Exhibit “D”
-5-
By execution below, the undersigned City representative certifies that he/she met, in person, with the Participant, and read to the Participant (with translator, if English is not a primary language spoken by Participant) this Affordable Housing Disclosure Statement, and further explained to the Participant the purpose and effect of the City Affordable Housing Agreement.
By:
Printed Name:
Title:
Date:
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Exhibit “E”
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EXHIBIT “E”
SUBORDINATION AGREEMENT
[See attached]
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Exhibit “E”
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Free Recording Requested By And
When Recorded Mail To:
City of Yorba Linda
4845 Casa Loma
Yorba Linda, CA 92886
Attention: City Clerk
[Exempt From Recording Fee
Per Gov. Code §6103 and 27383]
SUBORDINATION AGREEMENT
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY
INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENTS.
THIS SUBORDINATION AGREEMENT (“Agreement”) is entered into as of ____________, 20__, by and among the CITY OF YORBA LINDA, a California municipal corporation (“City”), _____________________ (“Participant”), and _________________ (“Lender”).
R E C I T A L S
A. Participant owns fee title to the real property described on Attachment No. “1” attached hereto and incorporated herein by reference (the “Property”).
B. The Property is part of a forty (40) unit residential townhome project developed by Olson Urban VI – Yorba Linda 2, LLC, a Delaware limited liability company (the “Project Developer”). The Property and the adjacent real property developed as part of the project (collectively, the “Project Site”) is in City’s Residential Urban (R-U) zoning district and is also in City’s Congregational Lands Overlay (CLO) Zone, which, among other requirements, requires that a minimum of twenty percent (20%) of the units developed shall be offered to, and sold to low or moderate income households at an affordable housing cost.
C. Pursuant to the CLO Zone requirements, eight (8) of the residential units constructed by the Project Developer (the “Affordable Units”) are required to be restricted, for forty-five (45) years, for sale to and ownership and occupancy by households which qualify as “persons and families of moderate income” pursuant to Health and Safety Code section 50093 at an affordable sales price, as calculated and determined pursuant to the methodology set forth in Health and Safety Code section 50052.5 (the “Affordable Sales Price”). The Property is one of the Affordable Units.
D. Pursuant to the State of California’s Density Bonus Law (Government Code Section 65915 et seq.) (the “Density Bonus Law”), the residential project qualified for a density bonus (which the Project Developer elected not to request). In connection with
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Exhibit “E”
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the Project Developer’s entitlement application, the Project Developer requested, under the Density Bonus Law, and City granted, waivers of certain City development standards.
E. On or about ____________, the Project Developer sold the Property to ___________________________________ (the “Original Participant”). In connection with the Original Participant’s purchase of the Property, the Original Participant and City entered into that certain Affordable Housing Agreement with Resale Restrictions and Option to Purchase, which, among other things, required that the Original Participant occupy the Property as the Original Participant’s principal place and residence and restricted the Original Participant’s resale of the Property to income-eligible households at a restricted sales price, as approved by City (the “AHA”). The AHA was recorded in the Official Records of the County of Orange (the “Official Records”) as Instrument No. _________________.
F. Concurrently with the execution of the AHA, the Original Participant executed that certain Deed of Trust, which secured the Original Participant’s payment of certain sums to City if such sums become due and the Original Participant’s performance under the AHA (the “City Deed of Trust”). The City Deed of Trust was recorded in the Official Records as Instrument No.____________.
G. On or about the same date hereof, Participant executed that certain Assumption, Release, and Consent Agreement, which is being recorded concurrently herewith in the Official Records, pursuant to which Participant agreed to assume all of the Original Participant’s rights and obligations under the AHA and City Deed of Trust.
H. Participant has executed or is about to execute a deed of trust, in favor of Lender, to be recorded concurrently herewith and encumbering the Property to secure a promissory note in the sum not to exceed
________________________________________________ Dollars ($_____________) (the “Lender Loan”), payable with interest and upon the terms and conditions described in such note (respectively, the “Lender Deed of Trust” and “Lender Note”).
I. Lender is willing to make the Lender Loan provided the Lender Deed of Trust is a lien or charge upon the Property prior and superior to the lien or charge of the City Deed of Trust and provided that City will specifically and unconditionally subordinate the lien or charge of the City Deed of Trust to the lien or charge of the Lender Deed of Trust.
J. City is willing to permit the Lender Loan to be recorded, and to subordinate the lien or charge of the City Deed of Trust to the Lender Deed of Trust provided the AHA is a lien or charge upon the Property prior and superior to the lien or change of the Lender Deed of Trust and provided that Lender will specifically and unconditionally subordinate