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to the greater of: (a)all amounts paid for the Property in excess of the Affordable Sales Price shall <br /> be forfeited to the City, or(b)the City Equity Share. <br /> 4.5 Equity Sharing Agreement. <br /> 4.5.1 Following the expiration of the Affordability Term, Homebuyer agrees to <br /> pay to the City the City Equity Share, as follows: <br /> 4.5.2 The City Equity Share shall be paid out of proceeds from a Transfer of the <br /> Property after the Affordability Term. <br /> 4.5.3 The City Equity Share includes the following: <br /> (a) An amount equal to the difference between the fair market value of <br /> the Affordable Unit at the time of the initial purchase and the Affordable Sales Price (the "Initial <br /> Subsidy"). <br /> (b) An amount equal to the product of (1) the appreciation of the <br /> Affordable Unit, as measured by the increase in the fair market value of the Affordable Unit at the <br /> time of the sale to the Homebuyer and the resale of the Affordable Unit, and (2) the percentage <br /> that the initial subsidy represented of the fair market value of the Affordable Unit when it was <br /> purchased by the Homebuyer(the"Proportionate Share of Appreciation"). <br /> 4.6 The City Equity Share shall only be subordinate to a First Lien, as approved by <br /> the City at the time of the initial sale (or subsequent approval in the event of a refinance or resale <br /> during the Affordability Term), and amounts owed to Homebuyer for the value of improvements <br /> to the Property and the down payment paid by Homebuyer. <br /> 4.7 For purposes of determining the City Equity Share, at the time of the initial sale <br /> of the Property, and each re-sale during the Affordability Term, the fair market value shall be <br /> determined as follows: <br /> 4.7.1 For the initial sale, Developer may propose to the City a fair market value <br /> based on a price per square foot that is based on comparable sales of other units within the Project. <br /> 4.7.2 Except as approved in writing by the City,prior to the sale of an Affordable <br /> Unit, a qualified appraiser shall conduct an appraisal of the Affordable Unit to determine fair <br /> market value without the restrictions of this Agreement. If the Developer or a prospective <br /> Homebuyer disputes the appraised value,then that party may pay for the costs of a second appraisal <br /> and, if there is still disagreement, the average of the two appraisals shall be used to determine the <br /> fair market value. <br /> 4.7.3 The fair market value of the Affordable Unit, as determined in accordance <br /> with the above, shall be provided to the City for approval or disapproval,which City shall provide <br /> within thirty (30) days of receipt of the proposed fair market value. If City does not provide a <br /> written response within such time period, then the proposed fair market value shall be deemed <br /> approved by the City. <br /> Page 34 <br /> Exhibit B <br /> 55 394.00101143724951.1 <br /> I <br />