HomeMy WebLinkAboutSANTA ANA 8 INV. LLC RECORDING REQUESTED BY:
Recorded in Official Records, Orange County
AND WHEN RECORDED MAIL TO: Hugh Nguyen, Clerk-Recorder
City of Santa Ana II I II II 1 �!I I� �I II III III I II I NO FEE
20 Civic Center Plaza (M-30) * $ R 0 0 1 5 6 3 z 3 0 4 $ *
P.O. Box 1988 2025000169429 03:03 pm 06/12125
Santa Ana, California 92702 18 Recwin3A Ale 83
Attention: City Clerk 0,00 0.00 0.00 0.00 246.00 0.00 0.00 0.00 0.00 0.00
Free Recordingpu suani to
Return FULLY EXECUTED Government Code§§6103 and 27383
Copy to City Clerk, M-30 A-2025-066
D Cmto DENSITY BONUS HOUSING AGREEMENT WITH DECLARATION OF
COVENANTS, CONDITIONS AND RESTRICTIONS
510-520 North Harbor Boulevard; APN: 100-63-04, 100-63-05
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This DENSITY BONUS HOUSING AGREEMENT WITH DECLARATION OF
COVENANTS, CONDITIONS AND RESTRICTIONS ("Agreement"), is made and entered into
this_I day of_`J tk'& , 2025 ("Effective Date"), for reference purposes only, by and
between the City of Santa Ana, a charter city and municipal corporation of the State of California
("City"), and Santa Ana 8 Inv, LLC, a Delaware limited liability company ("Developer"). City
and Developer are sometimes referred to collectively as the"Parties"and individually as a"Party."
RECITALS
A. Developer is the owner of that certain property located within the City of Santa
Ana, County of Orange, State of California, commonly known as
510 and 520 North Harbor Boulevard, Santa Ana, Califonua, and legally described
as set forth in Exhibits A-1 and A-2, which are attached hereto and incorporated
herein by this reference as if set forth in full ("Property").
B. Developer is proposing to develop a residential development consisting of no more
than forty five (45) units, five (5) of which are proposed as moderate income
residential ownership units on the Property, as more particularly set forth in Density
Bonus Application No. DBA-2024-02 ("Project").
C. Santa Ana Municipal Code sections 41-1600, et seq. ("City Density Bonus for
Affordable Housing"), and California Government Code sections 65915, et seq.
("State Density Bonus Law"), set forth a process to provide increased residential
densities and incentives,concessions, and waivers to property owners or developers
who restrict a portion of their residential development to Moderate Income
Households, as specified. These regulations are intended to materially assist the
housing industry in providing adequate and affordable housing for all economic
segments of the community and to provide a balance of housing opportunities
throughout the City.
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D. The Project complies with the affordability requirements for a housing
development as set forth in the State Density Bonus Law and City Density Bonus
for Affordable Housing.
E. In light of the purpose of the State Density Bonus Law and City Density Bonus for
Affordable Housing, and the express provisions of Government Code Section
65915(d)(2)(A), the City has determined that the Project is eligible for one (1)
incentive or concession,and waivers as prescribed by the State Density Bonus Law,
F. This Agreement, and the exhibits attached hereto and incorporated herein by
reference, are intended to set forth the terms and conditions for the implementation
of the Proj ect's requirement to provide affordable housing units in exchange for
receiving the density bonus, concession and waivers set forth herein.
NOW,THEREFORE, in consideration of the above recitals,which are incorporated herein
by this reference, and of the mutual covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. DEFINITIONS AND EXHIBITS
1.1 Definitions. In addition to the terms that may be defined elsewhere in this
Agreement, the following terms when used in this Agreement shall be defined as follows:
1.1.1 "Affordability Covenants"means restrictions on the sale and conveyance
of the Property pursuant to California Government Code Section 65915 that ensure that the
Property will be preserved for Moderate Income Households for at least fifty-five (55) years for
owner-occupied housing units and will be sold or resold only to persons or families of very low,
low, or moderate income, as defined in Section 50052.5 of the California Health and Safety Code.
1.1.2 "Adjusted for Family Size Appropriate to the Unit" or "Adjusted for
Household Size"shall have the meaning set forth by Health and Safety Code Section 50052.5(h).
1.1.3 "Administrative Procedures Manual" shall mean the City's
Administrative Procedures Manual: Ownership Housing Development, setting forth rules and
regulations for the City's homeownership program.
1.1.4 "Affordability Term" means the duration of the Affordability Covenants
as set forth in Section 3.1.
1.1.5 "Affordable Housing Cost" means the total housing costs paid by a
qualifying Moderate Income Household in accordance with California Health and Safety Code
Section 50052.5, and implementing regulations of Sections 6920,6924 and 6930 of Title 25 of the
California Code of Regulations for Moderate Income Households. The Affordable Housing Cost
shall not exceed thirty-five percent (35%) times one hundred ten percent (110%) of the Orange
County Median Income Adjusted for Family Size Appropriate for the Unit. For Moderate Income
Households whose gross income exceeds 110% of Median Income, the Affordable Housing Cost
shall not exceed thirty five percent(35%) of the gross income of the household.
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1.1.6 "Affordable Housing Resale Restrictions" means the restrictions
unposed on each Affordable Unit that restrict sales to qualified Eligible Households pursuant to a
local preference for families who live or work in the City of Santa Ana at an Affordable Sales
Price, in the form of Exhibit B attached hereto.
1.1.7 "Affordable Sales Price" means the maximum sales price that can be
charged for an Affordable Unit as set forth in Section 3.3.1.
1.1.8 "Affordable Units(s)" means the five (5) unit(s), which shall comprise of
four (4) three-bedroom units and one (1) four-bedroom unit, which always must be proportionate
to the unit mix for the property. Any change to the number,bedroom size, location,or distribution
of Affordable Units is subject to City Manager approval.
1.1.9 "Agreement" means this Density Bonus Housing Agreement With
Declaration of Covenants, Conditions and Restrictions.
1.1.10 "Benchmark Down Payment" is a component of the Affordable Sales
Price calculations. For the purposes of this Agreement, the Benclunark Down Payment is set at
5% of the total Affordable Sales Price. The Benchmark Down Payment is used solely as a
component for determining the Affordable Sales Price for an Affordable Unit.It does not represent
a cap on the down payment ainount that can be contributed by a Homebuyer.
1.1.11 "Certificate of Occupancy" means a certificate or approval of a final
inspection from the City.
1.1.12 "City" means the City of Santa Ana, California.
1.1.13 "City Attorney"means the City Attorney for the City of Santa Ana.
1.1.14 "City Council" means the City Council of the City of Santa Ana.
1.1.15 "City Deed of Trust" means the deed of trust to be executed by the
Homebuyer and recorded against Affordable Unit the Homebuyer's obligations under the City
Promissory Note, substantially in the form attached hereto as Exhibit D.
1.1.16 "City Manager"means the City Manager for the City of Santa Ana.
1.1.17 "City's Planning Commission" means the Planning Commission for the
City of Santa Ana.
1.1.18 "City Promissory Note" means the promissory note executed by the
Homebuyer evidencing Homebuyer's agreement to pay the City Equity Share, substantially in the
form attached hereto as Exhibit C.
1.1.19 "Density Bonus Application" shall mean the Density Bonus Application
No. 2024-02 for the Project.
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1.1.20 "Developer" means Santa Ana 8 Inv, LLC, a Delaware limited liability
company, and its permitted successors and assigns to all or any part of the Property,Project or this
Agreement.
1.1.21 "Effective Date"means the date the Developer and the City shall record or
cause to be recorded in the Official Records for Orange County, California, an executed original
of this Agreement,pursuant to Section 4.2 herein.
1.1.22 "Eligible Household" means a Household whose income does not exceed
the"Moderate Income Household" qualifying limit as defined herein.
1.1.23 "First Lien" means the lien of the institution making the purchase money
mortgage loan to Homebuyer for the purchase of an Affordable Unit. For the avoidance of doubt,
the City's Deed of Trust shall be subordinate to the First Lien.
1.1.24 "Gross Household Income"means all income from whatever source from
all adult Household members, which is anticipated to be received during the 12-month period
following the date of the determination of Gross Household Income, The applicable sources of
income are defined in California Code of Regulations Title 25 Housing and Community
Development Section 6914. The definition includes the following specific requirements:
(a) Except as provided in subdivision(b), all payments from all sources
received by the head of Household (even if temporarily absent) and each additional member of the
Household who is not a minor shall be included in the annual income of a Household. Gross
Household Income shall include,but not be limited to:
(i) The gross amount,before any payroll deductions, of wages
and salaries, overtime pay, commissions, fees, tips and bonuses;
(ii) The net income from operation of a business or profession
or from rental or real or personal property(for this purpose, expenditures for business expansion
or amortization of capital indebtedness shall not be deducted to determine the net income from a
business);
(iii) Interest and dividends;
(iv) The full amount of periodic payments received from social
security, annuities, insurance policies, retirement funds, pensions, disability or death benefits and
other similar types of periodic receipts (but see subdivision(2)(c));
(v) Payments in lieu of earnings, such as unemployment and
disability compensation, worker's compensation and severance pay;
(vi) Public Assistance. If the public assistance payment includes
an amount specifically designated for shelter and utilities which is subject to adjustment by the
public assistance agency in accordance with the actual cost of shelter and utilities, the amount of
public assistance income to be included as income shall consist of:
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(1) The amount of the allowance or grant exclusive of
the amount specifically designated for shelter and utilities, plus
(2) The maximum amount which the public assistance
agency could in fact allow for the Household for shelter and utilities.
(vii) Periodic and determinable allowances such as alimony and
child support payments, and regular contributions or gifts received from persons not residing in
the dwelling;
(viii) All regular pay, special pay and allowances of a member of
the Armed Forces (whether or not living in the dwelling) who is head of the Household or spouse
or domestic partner(but see subdivision (b)(v));
(ix) Where a Household has net assets in excess of$5,000,
income shall include the actual amount of income, if any, derived from all of the net Household
assets or 10 percent of the value of all such assets, whichever is greater. For purposes of this
section, net Household assets means value of equity in real property other than the Houschold's
full-time residence, savings, stocks, bonds, and other forms of capital investment. The value of
necessary items such as furniture and automobiles shall be excluded,
(b) The following items shall not be considered as income:
(i) Casual, sporadic or irregular gifts;
(ii) Amounts which are specifically for or in reimbursement of
the cost of medical expenses;
(iii) Lump-sum additions to Household assets, such as
inheritances, insurance payments (including payments under health and accident insurance and
worker's compensation), capital gains and settlement for personal or property losses;
(iv) Amounts of educational scholarships paid directly to the
student or to the educational institution, and amounts paid by the government to a veteran for use
in meeting the costs of tuition, fees,books and equipment. Any amounts of such scholarships, or
payments to veterans not used for the above purposes of which are available for subsistence are
to be included in income;
(v) The special pay to a serviceman head of a Household away
from home and exposed to hostile fire;
(vi) Relocation payments made pursuant to federal, state, or
local relocation law;
(vii) Foster child care payments;
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(viii) The value of coupon allotments for the purchase of food
pursuant to the Food Stamp Act of 1964 which is in excess of the amount actually charged the
eligible Household;
(ix) Payments received pursuant to participation in the
following volunteer programs under the ACTION Agency:
(1) National Volunteer Antipoverty Programs which
include VISTA, Service Learning Programs and Special Volunteer Programs.
(c) National Older American Volunteer Programs for persons aged 60
and over which include Retired Senior Volunteer Programs, Foster Grandparent Program, Older
American Community Services Program, and National Volunteer Program to Assist Small
Business Experience, Service Corps of Retired Executive (SCORE) and Active Corps of
Executives (ACE)
1.1.25 "Homebuyer" means an Eligible Household that has entered into an
agreement to purchase an Affordable Unit in accordance with this Agreement.
1.1.26 "Homebuyer Documents" means the Affordable Housing Resale
Restrictions, the City Promissory Note, and the City Deed of Trust.
1.1.27 "Household" means all the persons who will occupy the Affordable Unit
as their primary residence. The size of a prospective Household must be compatible with the size
of the Affordable Unit to be purchased. Unless otherwise approved in writing by the City, which
the City may withhold in its reasonable discretion, the minimum number of occupants is three (3)
for three-bedroom units and four (4) for four-bedroom units. A child who is subject to a legally-
binding shared-custody agreement, in which the child resides with the Household at least 50% of
the time, is counted as a member of the Household. For the purpose of calculating the Household
income and not the number of occupants, excluded from the definition of Household are live-in
caregivers/caretakers,foster children.,unborn children and children being pursued for legal custody
or adoption that are not currently living with the Household.
1.1.28 "Housing Cost" means and includes all of the following costs associated
with ownership of an Inclusionary Unit as defined in Title 25 of the California Code of Regulations
Section 6920:
(a) Principal and interest on a mortgage loan at the defined interest rate;
(b) Property tax and assessments;
(c) Fire and casualty insurance covering replacement value of property
improvements;
(d) Property maintenance and repairs;
(e) A reasonable utility allowance, as determined by the City; and
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(f) Homeowner Association assessments and dues.
1.1.29 "Median Income" means the Orange County, California area median
income,Adjusted for Household Size pursuant to California Health and Safety Code § 50052.5(h),
as periodically published by HCD.
1.1.30 "Moderate Income Household(s)" means a Household whose income
does not exceed One Hundred Twenty Percent (120%) of the area median income for the Orange
County, California PMSA as published by HCD,
1.1.31 "Primary Residence" means that the Homebuyer is occupying the
Affordable Unit for at least ten (10) months out of any twelve(12) month period.
1.1.32 "Project" means that certain affordable residential development as more
particularly described in the Recitals and Section 2 of this Agreement.
1.1.33 "Project Approvals" means all approvals, conditions, and entitlements
issued by the City, inclusive of the Planning Commission and City Council.
1.1.34 "Property"means that certain real property more particularly described in
the legal description in Exhibit A and improvements thereon.
1.1.35 "Request for Default" means the request for default attached hereto as
Exhibit I.
1.1,36 "State Density Bonus Law" means Government Code Section 65915, et
seq., as they exist on the Effective Date.
1.1.37 "Supportable Mortgage" means the mortgage amount that can be
supported by a Moderate Income Household based on the Affordable Housing Cost calculations.
The mortgage calculation is based on the prevailing market interest rate for a 3 0-year fully
amortizing mortgage with a fixed interest rate. The Supportable Mortgage shall be determined in
accordance with the City's Administrative Procedures Manual, provided that it should be
determined for a Moderate Income Household consistent with the requirements of this Agreement
and State Density Bonus Law.
1.1.38 "Transfer" means any sale, assignment, conveyance, lease or transfer,
voluntary or involuntary, of any interest in the Property. Without limiting the generality of the
foregoing, Transfer shall include(i) a transfer by devise, inheritance or intestacy; (ii) creation of a
life estate or joint tenancy interest; (iii) a gift of all or any portion of the Property; or (iv) any
voluntary conveyance of the Property.
1.1.39 "Transferee"means any natural person or entity who obtains ownership or
possessory rights in the Property pursuant to a Transfer.
1.1.40 "Term"means the period during which this Agreement shall be in full force
and effect, as provided for in Section 5.1 below.
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1.1.41 "Unit" means a residential dwelling unit within the Project to be
constructed or caused to be constructed by Developer.
1.1,42 "Unrestricted Units" means the Units within the Project to be constructed
or caused to be constructed by Developer and sold at market rate without restriction.
1.2 Exhibits. The following documents are attached to, and by this reference made
a part of, this Agreement:
1.2.1 Exhibit A (1-2): Legal Description of the Property
1.2.2 Exhibit B: Affordable Housing Resale Restrictions, Equity
Sharing and Regulatory Agreement
1.2.3 Exhibit C: City Promissory Note
1.2.4 Exhibit D: City Deed of Trust
1.2.5 Exhibit E: Income Verification Form
1.2.6 Exhibit F: Certification of Continued Occupancy
1.2.7 Exhibit G: Notice of Affordability Restrictions on Transfer of
Property
1.2.8 Exhibit H: Request for Default
1.2.9 Exhibit I: Affordable Sales Price
2. DEVELOPMENT OF THE PROPERTY
2.1 Project, Developer shall develop, operate, and maintain, or cause the
development, operation and maintenance of, the Property as forty five (45) Units, with five (5)
Affordable Units for Eligible Households and forty(40)Unrestricted Units in accordance with this
Agreement and the Project Approvals.Notwithstanding anything to the contrary contained herein,
in no event shall this Agreement apply to any of the Unrestricted Units and such Unrestricted Units
shall not be subject to any of the covenants, restrictions, requirements, or provisions of this
Agreement which are applicable to the Affordable Units and this Agreement shall not be recorded
on the title of any of the Unrestricted Units.
2.2 Density Bonus. The Project shall have forty five(45) Units, to be sold, owned,
occupied, operated, and maintained pursuant to the terms and conditions of this Agreement.
Developer understands and agrees that Developer is not requesting an increase in density and that
this Agreement does not allow or approve an increase in residential density over the allowed
density regulations of the City. Developer shall not construct or develop, or otherwise claim a
right to construct or develop any additional residential units on the Property under this Agreement.
2.3 Development Concessions, Incentives, and Waivers, As set forth in the City
entitlements,Developer petitioned for and is hereby granted the following concessions,incentives,
and waivers as part of the approval of Density Bonus Application:
2.3.1 Concession. In accordance with Government Code Section 65915(d)(1),the
Project is granted one (1) concession for relief from City Municipal Code Section 41-592.3 and
SP-2, Ch. 3, Frontyard/Porch Frontage Type Configuration Requirement, contained at 1, on Page
3-9, which would ordinarily require the Project provide porch dimensions as follows: a minimum
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porch depth of 6 feet,a minimum porch width of 10 feet(for asymmetrical entries)and a minimum
porch height of 10 feet. Pursuant to the Project Approvals,the Project shall provide the following:
(a) Clear ground floor height minimum of nine feet-one inch (9'-1");
(b) Porch depth minimum of four feet (4') (measured from face of
landing to building fagade); and,
(c) Asymmetrical entry width minimum of nine feet-six inches (9'-6").
2.3.2 Waivers. In accordance with Government Code Section 65915(e),provided
the Project complies with the Project Approvals, the Project is granted the following waivers or
reductions from Onsite Open Space Requirements:
(a) The requirement of City Municipal Code Section 41-592.3 and SP-
2, Ch. 3, Table 3-9, to provide minimum private open space of 90 square feet per unit is waived
for eighteen (18) units.
(b) The requirement of City Municipal Code Section 41-592.3 and SP-
2, Ch. 3, Table 3-9, for minimum private open space dimensions is reduced from six (6) feet to
four feet-six inches (4'-6").
(c) The requirement of City Municipal Code Section 41-592.3 and SP-
2, Ch. 3, Table 3-9 for common open space is reduced from 12,219 square feet, which is 15% of
the lot area, to 3,853 square feet.
2.4 Parking Requirements. Onsite parking shall be provided in compliance with
Government Code Section 65915(p). The Project shall provide not less than ninety nine (99)
parking spaces.
2.5 No Further Concessions, Incentives, or Waivers. Developer acknowledges
and agrees that no further concessions, incentives, waivers or parking requirements are requested,
and that the terms set forth in Section 2.3 and 2.4 fully satisfies any duty City may have under the
City Density Bonus for Affordable Housing,the Density Bonus Law,or any other law or regulation
to provide any density bonus incentive or to waive any building, zoning, or other requirement in
connection with a density bonus. By this Agreement, Developer releases any and all claims
Developer may have against City in any way relating to or arising from City's obligation to waive
requirements of or provide development incentives pursuant to the City Density Bonus for
Affordable Housing and the Density Bonus Law applicable to the Project.
2.6 Unit Mix.
2.6.1 Unrestricted Units. The Project, for purposes of this Agreement, may have
no more than forty (40) Unrestricted Units, as set forth Section 2.6.3, below, plus any Released
Units,as set forth in Section 3.6 below,and pursuant to the terms and conditions of this Agreement.
Any change to the unit distribution of the Unrestricted Units may affect the comparability of the
Affordable Units and is subject to City Manager approval.
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2.6.2 Affordable Units. The Project, for purposes of this Agreement, shall have
no less than five (5) Affordable Units, for Moderate Income Households, as set forth in Section
2.6.3, and pursuant to the terms and conditions of this Agreement. The Affordable Units shall be
consistent with the Project Approvals, comparable in bedroom distribution and amenities to the
Unrestricted Units, and shall be located throughout the Project as required under Santa Ana
Municipal Code section 41-1602(c)(5).
2.6.3 Unit Mix. Four (4) Affordable Units shall be three-bedroom units and one
(1) Affordable Unit shall be a four-bedroom unit. The Affordable Units shall be consistent with
the Project Approvals for the Project.
2.7 Minimum Development Standards for Affordable Units. The Affordable Units
shall be constructed with the same exterior appearance and interior features, fixtures, and
amenities, and shall use the same type and quality of materials as provided for any base
Unrestricted Units, regardless of whether such Unrestricted Units are in the Project.
Notwithstanding the foregoing, nothing herein shall be construed to limit the ability of purchasers
of Unrestricted Units to purchase upgrades for such units.
2.8 Permits and Processin • Compliance with Laws. Developer, at its sole cost and
expense, or as otherwise set forth in a separate written agreement, shall secure or cause to be
secured any and all permits that may be required for development of the Project by City or any
other federal, state, or local governmental entity having or claiming jurisdiction over the Property
or Project. Upon securing any and all permits, and all necessary financing and property interests,
Developer shall carry out and perfonn the development, operation, and maintenance of the Project
or cause the performance of the development, operation, and maintenance of the Project, in
conformity with all applicable federal, state, and local laws and regulations, and all conditions of
approval issued by the City Council and City's Planning Commission for the Project, inclusive of
the Project Approvals. Any changes to the Project shall be reviewed by the City Manager to
determine compliance with this Agreement. If any changes to the Project shall materially alter the
ability of Developer to comply with any terms of this Agreement in City's reasonable
determination, then City and Developer shall meet and confer to address amendments and
revisions to this Agreement as necessary.
2.9 Relocation Prior to Develo rnent of Project. If relocation is required prior to the
completion of development of the Project, Developer shall have the sole and exclusive
responsibility for providing relocation assistance and paying all relocation costs as may be required
to comply with applicable federal and state laws and regulations.In addition to any other indemnity
provided by Developer under this Agreement,Developer shall indemnify, defend (with counsel of
City's choosing and the consent of Developer, which shall not be unreasonably withheld, and
which may be joint defense counsel upon City's and Developer's consent), and hold harmless City
and all of its officials, officers, employees,representatives,volunteers and agents from any and all
alleged or actual claims, causes of action, liabilities, and damages from any third party for
relocation assistance,benefits and costs prior to the completion of the development of the Project.
2.10 Mechanic's Liens; Indemnification. Developer shall take all actions reasonably
necessary to remove any future mechanic's liens or other similar liens (including design
professional liens) against the Property or Project, or any part thereof, by reason of work, labor,
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services, or materials supplied or claimed to have been supplied to Developer or caused by, at the
direction of, or on behalf of Developer. Prior to the recording of this Agreement(or memorandum
thereof)pursuant to Section 4.2 below, Developer shall provide evidence from the Title Company
of any new recordings against the Property or Project. City hereby reserves all rights to post notices
of non-responsibility and any other notices as may be appropriate upon a filing of a mechanic's
lien. In addition to any other indemnity provided by Developer under this Agreement, Developer
shall indemnify,defend (with counsel of City's choosing and the consent of Developer,which shall
not be unreasonably withheld, conditioned or delayed and which may be joint defense counsel
upon City's and Developer's consent), and hold harmless City and all of its officials, officers,
employees,representatives,volunteers and agents from any and all alleged or actual claims, causes
of action, liabilities, and damages from any third party by reason of a mechanic's lien or work,
labor, services, or materials supplied or claimed to have been supplied to Developer or caused by,
at the direction of, or on behalf of Developer.
3. AFFORDABILITY
3.1 Affordability Tenn. The Affordability Term for each Affordable Unit shall
commence on the date the Affordable Unit receives a certificate occupancy and expire fifty-five
(55) years later (each an "Affordability Term").
3.2 Memorializing Commencement of Affordability Ter1x1. Developer shall keep or
cause to be kept detailed records of the commencement date of the Affordability Term for each
Affordable Unit until that Affordable Unit is sold to a Homebuyer in accordance with this
Agreement or released pursuant to Section 3.6 hereof, City shall have the right to review and
verify said records without a fee from City to Developer to ensure that the commencement date
specified by Developer for an Affordable Unit coincides with the date that the initial Affordable
Unit received all permits from City required for occupancy of the Unit. In the event that a conflict
exists between the date specified by Developer for the commencement of the Affordability Term
for an Affordable Unit and the date specified by City's issuance of all required permits for
occupancy of the Unit, the date specified by City's issuance of all required permits for occupancy
of the Unit shall control.
3.3 Levels of Affordability. Each Affordable Unit shall be initially sold to and
occupied by an Eligible Household for an Affordable Sales Price, and any resale shall be subject
to the Affordable Housing Resale Restrictions and the City Deed of Trust recorded against the
Affordable Unit,
3.3.1 Affordable Sales Price. Developer covenants that, during the Term of this
Agreement, each Affordable Unit shall be sold to,or held vacant for sale to,an Eligible Household
for an Affordable Sales Price. The Affordable Sales Price is equal to the sum of the Supportable
Mortgage plus, if applicable, the Benchmark Down Payment. Prior to the sale of any Affordable
Unit, Developer shall provide the City with at least thirty (30) days' written notice of the
determined amount,and the City shall have ten(10)days to approve or disapprove of the proposed
Affordable Sales Price. The Affordable Sales Price for the initial sale of the Affordable Units shall
be as calculated in Exhibit I.
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3.4 Notice to_City. Prior to entering into an agreement for the transfer of an
Affordable Unit, Developer shall provide at least thirty(30)days written notice to the City, along
with a proposed written agreement setting forth the terms of the sale, including the proposed
Affordable Sales Price.
3.5 Homebuyer Documents. The sale of each Affordable Unit is subject to satisfaction
of the following conditions:
3.5.1 Each Homebuyer shall execute the Affordable Housing Resale Restrictions,
which shall be recorded against the Affordable Unit.
3.5.2 The Affordable Housing Resale Restrictions shall include the following
occupancy requirements: The Owner shall occupy and continually use the Affordable Unit as the
Homebuyer's Primary Residence during the Total Affordability Term. On an annual basis, the
City's Program Manager will send the Homebuyer an Occupancy Recertification Form to be filled
out and returned to the City within thirty(30)days of receipt.The Owner shall affirm that they are
occupying the Affordable Unit as their Primary Residence. The Owner will be required to submit
copies of two current utility bills, or other evidence of occupancy that is acceptable to the City, as
part of the annual recertification process.
3.5.3 The Affordable Housing Resale Restrictions shall provide for the terms of
resale and the distribution of proceeds from any sale, as follows:
(a) The Homebuyer shall execute the City Promissory Note evidencing
Homebuyer's agreement to pay the City Equity Share, and record the City Deed of Trust against
the Affordable Unit to secure the City Promissory Note.
(b) During the Affordability Term, prior to the Transfer of an
Affordable Unit, each Homebuyer shall agree to the City Promissory Note, and execute the
Affordable Housing Resale Restrictions, the City Deed of Trust, the Notice of Restrictions, and
the Request for Default, which shall be recorded against each Affordable Unit. In the event a
Homebuyer seeks to Transfer an Affordable Unit during the Affordability Term, the City, in its
sole and absolute discretion,may approve an assignment and assumption agreement for subsequent
sales of the Property to Eligible Households during the Affordability Term. The Affordable
Housing Resale Restrictions shall provide that Affordable Units shall only be Transferred to an
Eligible Household for an Affordable Sales Price during the Affordability Term,and the City Deed
of Trust securing the City Promissory Note shall remain a lien on the Property.
(c) During the Affordability Term, if a Transfer complies with the
requirements of the Affordable Housing Resale Restrictions, then the Homebuyer selling the
Affordable Unit shall be entitled to closing proceeds after payment of a First Lien for the
Affordable Unit, and the City Equity Share shall be an obligation of the new Homebuyer,pursuant
to the City Promissory Note and City Deed of Trust recorded against the Property.
(d) Following the expiration of the Affordability Term for the
Affordable Unit, the City Equity Share shall become due and payable upon a Transfer of the
Property.
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(e) The City Equity Share includes an amount equal to the "initial
subsidy" and "proportionate share of appreciation," in accordance with California Government
Code section 65915(c)(2), and shall be determined as follows:
(i) An amount equal to the difference between the fair market
value of the Affordable Unit at the time of the initial purchase and the Affordable Sales Price
(the"Initial Subsidy"), plus
(ii) An amount equal to the product of(1) the appreciation of
the Affordable Unit, as measured by the increase in the fair market value of the Affordable Unit
at the time of the sale to the Homebuyer and the resale of the Affordable Unit, and (2) the
percentage that the Initial Subsidy represented of the fair market value of the Affordable Unit
when it was purchased by the Homebuyer (the"Proportionate Share of Appreciation").
(0 Payment of the City Equity Share is subject to the following: (1)
payment to satisfy a First Lien from a primary lender, as approved by City at the time of the initial
sale, or subsequent approval in the event of a refinance event, and (2) an amount equal to the down
payment and the cost of improvements paid by the Homebuyer. Following payment of the City
Equity Share, the Homebuyer shall receive the remainder of any closing proceeds, less any costs
of closing, including any and all real estate broker commissions.
(g) When the City Equity Share becomes due, the proceeds from the
sale of the Property shall first satisfy a First Lien, and the Homebuyer shall receive proceeds for
the value of any improvements and any down payment actually paid. The City Equity Share shall
be paid prior to disbursement of remaining sales proceeds to the Homebuyer.
3.5.4 In order to assist City with calculation of the City Equity Share, Developer
or a Homebuyer, as applicable, shall provide City with a calculation of the fair market value of
each Affordable Unit at the initial sale which shall be determined as follows:
(a) For the initial sale,Developer shall propose to the City a fair market
value based on a price per square foot that is based on comparable sales of other units within the
Project.
(b) Except for the initial sales subject to sub-paragraph (a), prior to the
sale of an Affordable Unit, a qualified appraiser shall conduct an appraisal of the Affordable Unit
to determine fair market value without the restrictions of this Agreement. If a seller or prospective
Homebuyer disputes the appraised value,then that party may pay for the costs of a second appraisal
and, if there is still disagreement, the average of the two appraisals shall be used to determine the
fair market value.
(c) The fair market value of the Affordable Unit, as determined in
accordance with the above, shall be provided to the City for approval or disapproval, which City
shall provide within thirty (30) days of receipt of the proposed fair market value. If City does not
provide a written response within such time period, then the proposed fair market value shall be
deemed approved by the City.
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3.6 Alternative Compliance. If, for the initial sale of an Affordable Unit, a
Homebuyer has not been identified by the Developer for certification by the City within 90 days
of the issuance of a Certificate of Occupancy for such unit and good faith marketing efforts by
Developer, as outlined in Section 4.13, Developer shall provide the City written notice that a
Homebuyer has not been identified for the Affordable Unit; the notice to the City shall include a
description of additional plans to market the Affordable Unit subject to City's reasonable review
and approval. If Developer is still unable to identify a Homebuyer within an additional 90 days
following implementation of the additional marketing plan approved by the City, Developer may
sell the Affordable Unit to a qualified nonprofit housing corporation pursuant to, and subject to
the requirements of, the State Density Bonus Law ("Nonprofit Unit"). At close of such a sale,
provided that the Developer has complied with all requirements of the State Density Bonus Law,
including but not limited to recording an equity sharing agreement against the Nonprofit Unit
required under Govermnent Code Section 65915(c)(2)(C), the Nonprofit Unit shall not be subject
to any requirement of this Agreement and this Agreement shall terminate as to and cease to be a
burden on or encumbrance against that Nonprofit Unit. Upon Developer's request in connection
with a sale of a Nonprofit Unit approved by the City, City agrees to provide documentation, in a
form subject to City's reasonable approval, terminating this Agreement as to that Nonprofit Unit
at the close of the sale.
4. OPERATION OF THE PROJECT BY DEVELOPER
4.1 Payment of Density Bonus Setup Fee. A Density Bonus Setup Fee in the ainount
of Fifteen Thousand Nine Hundred Sixty Seven Dollars and Ninety Cents ($15,967.90), was
paid by the Developer on December 9, 2024.
4.2 Recording of Documents, Priority.
4.2.1 Prior to issuance of building permits for the Project,Developer and the City
shall record or cause to be recorded in the Official Records for Orange County, California, an
executed original of this Agreement,and Developer shall deliver the proof of recording as required
by Section 4.2.3,below. City shall cooperate with Developer in promptly executing in recordable
form this Agreement. The date of recording of the Agreement shall be the Effective Date of the
Agreement. Upon the date of recording, the terms and conditions of this Agreement shall be
binding upon and run with the Property and Project for the Term of this Agreement. It is the
express intent and agreement between the Parties that this Agreement shall remain binding and
enforceable against the Affordable Units for the Term of this Agreement to ensure compliance
with the State Density Bonus Law and City Density Bonus Law,and to ensure the continued supply
of Affordable Units in the Project, except as expressly set forth in this Agreement.
4.2.2 The Agreement shall be recorded against the Property and have priority over
those matters of public record, except as approved in writing by the City;provided,however,prior
to issuance of a Certificate of Occupancy for the Project, the Parties may execute an amendment
to this Agreement or other appropriate instrument that ensures that the requirements of this
Agreement, upon the creation of the Affordable Units and the recordation of this Agreement, are
properly recorded against each Affordable Unit and memorializes Owner's obligation to provide
the Affordable Units on a for-sale basis in accordance with this Agreement and,upon the recording
of such instrument as to the individual Affordable Units, the City may determine, in its sole and
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absolute discretion, to a release of this Agreement to the Property as a whole. Provided, however,
this Agreement shall terminate and be of no further force and effect on the Unrestricted Units or
any common areas of the Property as provided in Section 5.1,
4.2.3 Prior to issuance of building permits for the Project, Developer shall cause
to be provided to City a condition of title guarantee(or other evidence acceptable to the City) that
demonstrates this Agreement is senior to any other lien, deed of trust,mortgage, or other interest
in the Property or the Project, except any Developer construction loan, Developer mortgage or
deed of trust, or other interest in the Property or the Project approved by the City in writing, which
approval shall not be unreasonably conditioned,withheld, or delayed. The City shall have not less
than ten (10) days to determine that this Agreement (or an amended version of the Agreement
restricting the Affordable Units) has senior rights. If City disapproves the evidence provided by
Developer, then Developer agrees and acknowledges that City may withhold the building permit
unless and until Developer provides evidence satisfactory to the City demonstrating priority of this
Agreement or an amendment thereto.
4.3 Occupancy Levels. Developer shall not apply or permit any occupancy
requirements that violate local, state or federal law during the development or sale of the
Affordable Units,
4.4 Use of the Property. All uses conducted on the Property by Developer,
including, without limitation, all activities undertaken by the Developer pursuant to this
Agreement, shall conform to all applicable provisions of the Santa Ana Municipal Code and other
applicable federal, state, and local laws,rules, and regulations.
4.5 Maintenance. Developer shall, at all times during the term of this Agreement,
cause the Property and the Project to be maintained in a decent, safe and sanitary manner,
regardless of cause of the disrepair. Developer, until a Homeowners' Association ("HOA") is
established, at which point, the HOA and each Homebuyer shall be fully and solely responsible
for costs of maintenance, repair, addition and improvements. City, and any of its employees,
agents, contractors or designees shall have the right to enter upon the Property at reasonable times
and in a reasonable manner to inspect the Project, after providing notice as follows: (i) at least a
24-hour notice to Developer and Homebuyer of the Affordable Unit which will be inspected, or
(ii) at least 48 hours' notice to Developer, which shall promptly give notice to Owners of the
Affordable Unit to be inspected.
4.6 Pre aration and Recordation of Transfer Documents. Developer shall prepare
and obtain City's approval, which approval shall not be unreasonably withheld, conditioned or
delayed, of the Affordable Housing Resale Restrictions, the City Promissory Note, the City Deed
of Trust, and the Notice of Affordability Restrictions, for each Affordable Unit to Eligible
Households required by Section 3 of this Agreement in substantially the forms attached hereto as
Exhibits B, C, D,and G, respectively. Developer shall not sell an Affordable Unit unless and until
the City has reviewed and approved the Homebuyer as an Eligible Household for the purchase of
the Affordable Unit, and the Homebuyer has executed and submitted to the Program Director, in
recordable form, the Affordable Housing Resale Restrictions, the City Deed of Trust, and the
Notice of Affordability Restrictions, and the approved financing for the Homebuyer, including the
executed City Promissory Note. City's approval of the Homebuyer as an Eligible Household
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pursuant to this Section 4.6 shall not be unreasonably conditioned,withheld, or delayed. City shall
have thirty(30) days to review a request to approve a proposed Homebuyer.
4.7 Selection of Homebuyers.
4.7.1 Developer shall be responsible for the selection of Homebuyers for the
Affordable Units in compliance with lawful and reasonable criteria and the requirements of this
Agreement.
4.7.2 In selecting Homebuyers for the Affordable Units, Developer shall apply a
preference for Santa Ana residents and workers to the extent permissible by law. Subject to
applicable laws and regulations governing nondiscrimination and preferences in housing
occupancy required by the State of California, the Developer shall give preference in purchasing
the Affordable Units to households that live and/or work in the City of Santa Ana or who have an
active Housing Choice Voucher issued by the Housing Authority of the City of Santa Ana or any
other Public Housing Authority.
4.7.3 Qualified applicants for Affordable Units will be screened and "lotterized."
A waiting list will be created from a lottery generated from the initial pool of qualified homebuyer
applications. The waiting list will track applicant name and contact information, lottery number
(or designated number after the initial lottery), household income, household size, status of
application, and any other information deemed necessary. The waiting list will be maintained as
an electronic file and available for audit by the City of Santa Ana in accordance with resident
selection procedures as set forth herein.
4.7.4 Prior to the sale of an Affordable Unit, Developer shall require the
Homebuyer to execute a written purchase sale agreement substantially similar to the Form PSA,
and a written certification from the Homebuyer verifying compliance with the requirements for an
Eligible Household and all other eligibility requirements established for the Affordable Unit.
Developer shall verify the income of the Homebuyer as set forth herein.
4.8 Income Verification and Certification. Developer shall verify income of
prospective Homebuyers and certify the verification to the City; provided, however, that
Developer shall not be liable for any fraud or mistake in performing its duties pursuant to this
Section 4.8. In evaluating prospective Homebuyers, Developer shall consider the following
sources of income in order of preference: (i) employment income; (ii) business income; (iii)
income from Social Security, Supplemental Security Income (SSI), welfare, disability, or pension
payments; and (iv) alimony or child support. To verify income, Developer shall comply with the
procedures set forth in Section A-3 of the Administrative Procedures Manual. Subject to the
foregoing preferences, Developer shall consider Gross Household Income from all adult
Household members,which is anticipated to be received during the 12-month period following the
date of the determination of Gross Household Income. Within fifteen (15) days of delivery of an
executed contract for purchase of an Affordable Unit by a prospective Homebuyer, Developer
shall provide City with the Income Verification Form set forth in Exhibit F and the Certification
of Continuing Occupancy set forth in Exhibit G.
4.9 DELETED
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4.10 DELETED
4.11 DELETED
4.12 Marketing and Resident Selection Plan.
4.12.1 Prior to Certificate of Occupancy,Developer shall prepare and obtain City's
approval, which approval shall not be unreasonably conditioned, withheld, or delayed, of a
marketing program and resident selection plan for the sale of the Affordable Units at the Project
("Marketing Program"). City shall have thirty(30)days to review a proposed Marketing Program.
The sale of the Affordable Units shall thereafter be marketed in accordance with the Marketing
Program as the same may be amended from time to time with City's prior written approval. Upon
request, Developer shall provide City with periodic reports with respect to the sale of the
Affordable Units.
4.12.2 The Marketing Program shall include marketing and community outreach
activities, proposed Homebuyer selection criteria, occupancy standards, income requirements,
timeline and details for outreach and marketing, data collection, record keeping and monitoring,
procedures for complaints, and compliance assessment. Components of the resident selection plan
shall include the application process, interview procedure, Affordable Unit offer and assigmnent
for selected homeowners, rejected applications, and wait list management. All requirements set
forth herein shall be incorporated in the Marketing Program.
4.13 Non-Discrimination in Housing. Developer, and any successors in interest, shall
not discriminate any person or group of persons on account of race, color, religion, sex, gender,
gender identity, gender expression, sexual orientation, marital status, national origin, ancestry,
familial or marital status, disability, veteran or military status, genetic information, political
affiliation or opinion, medical condition, pregnancy or pregnancy-related condition, or condition
of physical or mental disability or other handicap, age, or source of income or status with regard
to public assistance in the transfer, use, occupancy, tenure or enjoyment of the Property or the
Affordable Units, and the Developer,or any person claiming under or through it,shall not establish
or permit any such practice of discrimination or segregation with reference to the selection,
location,number,use or occupancy of any Homebuyer or resident of the-Property or the Affordable
Units.
4.14 Monitoring and Recordkee iinng. Throughout the Term of this Agreement, on or
before January 31 of each year, Developer shall annually complete or cause to be completed and
submit to City the Annual Compliance Report in the form set forth in Exhibit G for each year until
all Affordable Units are sold. Representatives of City shall be entitled to enter the Property if
necessary after review of above documentation, upon at least forty-eight (48) hour notice, to
monitor compliance with this Agreement, and shall be entitled to inspect the records of the Project
relating to the Affordable Units and to conduct an independent audit or inspection of such records
at a location within the City that is reasonably acceptable to the City without a fee from the City.
Developer agrees to cooperate with City in making the Property and the records of the Project
relating to the Affordable Unit reasonably available for such inspection or audit. Developer agrees
to maintain or cause for the maintenance of each record of the Project for no less than five (5)
years after creation of each such record.
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4.1 S Developer shall allow the City to conduct annual inspections of the Affordable
Units on the Property after the date of construction completion,with reasonable notice,which shall
be at least twenty four(24)hours in advance,unless a shorter time is required in an emergency, to
Developer for the Term of this Agreement. Developer shall commence to cure or cause the
commencement to cure any defects or deficiencies found by the City while conducting such
inspections within ten (10) business days of written notice thereof, or such longer period as is
reasonable within the reasonable discretion of the City.
5. TERM OF THIS AGREEMENT
5.1 Term. This Agreement shall continue until all Affordable Units have been
sold to Homebuyers pursuant to this Agreement (the "Term"). Upon the issuance of a Certificate
of Occupancy for all of the Affordable Units in a building, this Agreement shall terminate as to
the Unrestricted Units and the common area associated with that building. If there are no
Affordable Units in a particular building, this Agreement shall terminate as to the Unrestricted
Units in that building and the common area associated with that building upon the issuance of the
Certificate of Occupancy for Affordable Units in the prior building. Upon the initial sale of each
Affordable Unit and execution and recordation (as applicable) of the Homebuyer Documents
pursuant to Section 3.5, or sale of an Affordable Unit as a Released Unit pursuant to Section 3.6,
this Agreement shall terminate and be of no further force and effect with respect to such Affordable
Unit. Upon the initial sale of all Affordable Units to Eligible Households pursuant to this
Agreement, this Agreement shall terminate and be of no further force and effect. While not
necessary to effect the termination of this Agreement, the Parties shall cooperate to execute and
record a release or termination as to the Unrestricted Units, common area of the Project, or the
Affordable Units as per the terms of this Section.
5.2 Continuing Obligation to Pa the City Equity Share. Notwithstanding the
expiration of the Term,the City shall have the right to receive payment for the City Equity Share,
and enforce the Affordable Housing Resale Restrictions, the City Promissory Note, and the City
Deed of Trust until satisfactory payment of the City Equity Share pursuant to the terms of those
agreements.
6. DEFAULT AND TERMINATION; INDEMNIFICATION
6.1 Default. 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 such other period specifically provided herein), 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
within an additional sixty (60) days following the conclusion of such thirty (30) day period (for a
total of ninety(90)days). Except as required to protect against further damages,the injured Party
may not institute proceedings against the Party in default until the time for cure has expired.
Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it
change the time of default.
6.2 Remedies.
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6.2.1 Any individual who sells or rents (including subleasing)an Affordable Unit
in violation of the provisions of this Agreement shall be required to forfeit to City all monetary
amounts so obtained.
6.2.2 City may institute any appropriate legal actions or proceedings necessary to
ensure compliance with this Agreement, including but not limited to:
(a) Actions to revoke, deny or suspend any permits for the construction
of any Units in the Project, except that such actions may not include the suspension or revocation
of any issued permit or license for the construction of any unit or units in the Development that
have been constructed and sold or are under construction and under contract for sale;
(b) Applicable actions under the Affordable Housing Resale
Restrictions, City Promissory Note, or City Deed of Trust executed by a Homebuyer;
(c) Actions for injunctive relief, damages, or other monetary relief; and
(d) Civil citations or penalties.
6.3 Rights and Remedies Cumulative. 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.
6.4 Waiver of Speculative, Consequential, or Punitive Damage . Notwithstanding
anything to the contrary contained in this Agreement, in no event shall either Party be liable for
speculative, consequential, punitive or other indirect damages, and each Party waives any right
to collect speculative, consequential,punitive or other indirect damages against the other Party.
Developer acknowledges the protections of Civil Code Section 1542 relative to this waiver and
release, which section reads as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE
CREDITOR OR RELEASING PARTY DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR
HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER
SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.
BY INITIALING BELOW, DEVELOPER KNOWINGLY AND VOLUNTARILY WAIVES
THE PROVISIONS OF SECTION 1542 SOLELY IN CONNECTION WITH THE WAIVERS
AND RELEASES OF THIS SECTION.
DEVELOPER'S INITIALS
6.5 Indemnification. In addition to any other indemnity specifically provided in this
Agreement, Developer agrees to defend (with counsel of City's choosing and the consent of
Developer, which shall not be unreasonably withheld, conditioned or delayed and which may
be joint defense counsel upon City's and Developer's consent) indemnify and hold harmless
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City and its respective officers, officials, agents, employees, representatives, and volunteers
(collectively, "Indemnitees") from and against any loss, liability, claim, or judgment arising
from any claims, demands, or causes of action arising from or related to Developer's
performance of its obligations under this Agreement, including the approval of this Agreement,
except to the extent caused by the active negligence or willful misconduct of Indemnitees.
7. ASSIGNMENT; COVENANTS RUN WITH THE LAND
7.1 Assignment by Developer.
7.1.1 Prohibited Transfers or Assignments. Developer shall not sell, transfer, or
assign the Property or Project in whole or in part, or transfer or assign Developer's rights and
obligations in this Agreement,in whole or in part,unless the sale,transfer,or assignment complies
with this Section 7. With the exception of sale, transfer, or assigmnent occurring after the
recordation of this Agreement to an entity wholly owned by Developer, if Developer seeks to sell,
transfer or assign the Property or Project, or any rights and obligations in this Agreement,
Developer shall request City's written consent, and City shall respond within thirty (30) days with
a written approval or denial,which City may determine in its reasonable discretion. City's failure
to respond to the request within thirty (30) days shall be deemed an approval.
7.1.2 Sale or Conveyance of Property. Developer agrees and declares that the
Property and the Project shall be held, conveyed, mortgaged, encumbered, leased, rented, used,
occupied, operated, sold, and approved subject to all obligations set forth or incorporated in this
Agreement in accordance with the terms of Section 5.1 hereof, all of which are for the purpose of
enhancing and protecting the value and attractiveness of the Property and the Project. All of the
obligations set forth or incorporated in this Agreement shall constitute covenants which tun with
the land and shall be binding on Developer and its successors and assigns, and all parties having
or acquiring any right, title or interest in, or to any pant of the Property or Project. Developer
further understands and agrees that the approvals received for this Project have been made on the
condition that Developer and all subsequent owners, or other successors and assigns of the
Property and/or Project sell the Affordable Units in accordance with the covenants, conditions and
restrictions of this Agreement. Notwithstanding anything to the contrary contained herein, in the
event that Developer or any successor in interest elects not to construct the Project, or any portion
thereof, this Agreement shall terminate as to and cease to be a burden on or encumbrance against
the Property or such portion thereof upon expiration or earlier termination of the entitlements for
the Project.
7.1.3 Subsequent Assi nth. As used in this Agreement, the term "Developer"
shall be deemed to include any such transferee or assignee after the date such sale, transfer, or
assignment occurs in compliance with this Agreement.
7.l.4 Unpermitted Assignments Void. Any sale, transfer, or assignment made in
violation of this Agreement shall be null and void, and City shall have the right to pursue any right
or remedy at law or in equity to enforce the provisions of the restriction against unpertnitted sales,
transfers, or assignments.
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7.2 Covenants Run with the Land. The Property shall be used, occupied and
improved subject to the covenants, conditions, and restrictions set forth herein in accordance with
the terms of Section 5.1 hereof. The covenants, conditions, restrictions, reservations, equitable
servitudes, liens and charges set forth in this Agreement shall run with the Property in accordance
with the terms of Section 5.1 hereof and shall be binding upon Developer and all persons having
any right, title or interest in the Property, or any part thereof, their heirs, and successive owners
and assigns, shall inure to the benefit of City and its successors and assigns, and may be enforced
by City and its successors and assigns. 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 its successors and assigns, and the parties hereto expressly agree that this Agreement and the
covenants herein shall run in favor of City. City is deemed the beneficiary of the terins and
provisions of this Agreement and of the covenants running with the land, for and in its own right
and for the purposes of protecting the interests of the community and other parties, public or
private, in whose favor and for whose benefit this Agreement and the covenants running with the
land have been provided. Developer hereby declares its understanding and intent that the burden
of the covenants set forth herein touch and concern the land and that the Developer's interest in the
Property is rendered less valuable thereby. Developer hereby further declares its understanding
and intent that the agreement provides a public benefit in furtherance of benefit of such covenants
touch and concern the land by enhancing and increasing the enjoyment and use of the Property by
the citizens of City and by furthering the health, safety, and welfare of the residents of City.
8. MISCELLANEOUS
8.1 Entire Agreement. This Agreement and all of its exhibits and attachments set
forth and contain the entire understanding and agreement of the parties with respect to the density
bonus of the Project, and there are no oral or written representations, understandings or ancillary
covenants, undertakings or agreements which are not contained or expressly referred to herein.
No testimony or evidence of any such representations, understandings or covenants shall be
admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions
of this Agreement.
8.2 Amendment, Any alteration, change or modification of or to this Agreement, in
order to become effective, shall be made in writing and in each instance approved by the City
Council, or through the City Manager as detailed herein, and signed on behalf of each party. The
City Manager shall have the authority to make approvals,issue interpretations, execute documents,
waive provisions, and/or enter into amendments of this Agreement on behalf of City that further
the intent of this Agreement. Any requested alteration, change or modification of the Agreement
by Developer shall require the payment of fees or deposit by Developer to City, as applicable, for
the City's review of the request. Each alteration, change, or modification to this Agreement shall
be recorded against the Property in the Official Records of Orange County, California.
8.3 Notices.
8.3.1 Delivery. As used in this Agreement, "notice" includes, but is not limited
to, the communication of notice, request, demand, approval, statement, report, acceptance,
consent,waiver,appointment or other communication required or permitted hereunder. All notices
shall be in writing and shall be considered given either: (i) when delivered in person to the
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recipient named below; or(ii) on the date of delivery shown on the return receipt, after deposit in
the United States mail in a sealed envelope as either registered or certified mail with return receipt
requested, and postage and postal charges prepaid, and addressed to the recipient named below; or
(iii) two (2) days after deposit in the United States mail in a sealed envelope, first class mail and
postage prepaid, and addressed to the recipient named below;or(iv)one(1) day after deposit with
a known and reliable next-day document delivery service (such as Federal Express), charges
prepaid and delivery scheduled next-day to the recipient named below, provided that the sending
party receives a confirmation of delivery from the delivery service provider; or (v) the first
business day following the date of transmittal of any facsimile, provided confirmation of
successful transmittal is retained by the sending Party; or (vi) upon transmission thereof (as
evidenced by the recipient's reply to such notice or other competent evidence of actual receipt) if
transmitted by electronic transmission(email), provided that a copy of such notice is concurrently
sent by first-class mail postage prepaid. All notices shall be addressed as follows;
If to City: City of Santa Ana
Community Development Agency
20 Civic Center Plaza (M-26)
P.O. Box 1988
Santa Ana, California 92702
Attention: Housing Manager
With a copy to: Office of the City Attorney
City of Santa Ana
20 Civic Center Plaza, 7th Floor(M-29)
Santa Ana, California 92702
If to Developer: Santa Ana 8 Inv, LLC,
A Delaware limited liability company
3121 Michelson Dr, Suite 150
Irvine, CA 92612
8.3.2 Change of Address. Either Party may, by notice given at any time,require
subsequent notices to be given to another person or entity, whether a party or an officer or
representative of a party, or to a different address, or both. Notices given before actual receipt of
notice of change shall not be invalidated by the change.
8.4 Severability. If any term, provision, covenant or condition of this Agreement
shall be determined invalid, void or unenforceable, the remainder of this Agreement shall not be
affected thereby to the extent such remaining provisions are not rendered impractical to perform,
taking into consideration the purposes of this Agreement.
8.5 Interpretation and Governing,Law. This Agreement and any dispute hereunder
shall be governed and interpreted in accordance with the laws of the State of California without
regard to conflict of law principles. This Agreement shall be construed as a whole according to
its fair language and common meaning to achieve the objectives and purposes of the Parties hereto,
and the rule of construction to the effect that ambiguities are to be resolved against the drafting
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Party shall not be employed in interpreting this Agreement, all Parties having been represented by
counsel in the negotiation and preparation hereof
8.6 Section Headin s. All section headings and subheadings are inserted for
convenience only and shall not affect any construction or interpretation of this Agreement.
8.7 Singular and Plural. As used herein,the singular of any word includes the plural,
and vice versa, as context so dictates. Masculine, feminine, and neuter forms of any word include
the other as context so dictates.
8.8 Joint and Several Obligations. If at any time during the term of this Agreement
the Property and/or Project is owned, in whole or in part, by more than one Developer, all
obligations of such Developer under this Agreement shall be joint and several, and the default of
any such Developer shall be the default of all such Developers.
89 Time of Essence. Time is of the essence in the performance of the provisions of
this Agreement as to which time is an element.
8.10 Computation of Days. Unless otherwise specified in this Agreement or any
Exhibit attached hereto, use of the term "days" shall mean calendar days. For purposes of this
Agreement and all Exhibits attached hereto, "business days" shall mean every day of the week
except Saturdays, Sundays, official State holidays as recognized in Government Code Section
19853(a) or successor statute, and any days in which Santa Ana City Hall is closed for business.
8.11 Waiver. Failure by a Party to insist upon the strict performance of any of the
provisions of this Agreement by the other Party, or the failure by a Party to exercise its rights upon
the default of the other Party,shall not constitute a waiver of such Party's right to insist and demand
strict compliance by the other Party with the terms of this Agreement thereafter.
8.12 Non-Discrimination. In performing its obligations under this Agreement,
Developer shall not discriminate because of race, color, creed, religion, sex, gender, gender
identity, gender expression, marital status, sexual orientation, familial status, source of income,
veteran or military status, age, national origin, ancestry, disability or genetic information, as
defined and prohibited by applicable law, in the recruitment, selection, training, utilization,
promotion,termination or other related activities. Developer affirms that it is an equal opportunity
employer and shall comply with all applicable federal, state and local laws and regulations.
8.13 Third Party Beneficiaries. No person or entity, other than City and Developer
shall have any right of action based upon any provision of this Agreement.
8.14 Force Majeure. Neither Party shall be deemed to be in default where failure or
delay in performance of any of its obligations under this Agreement is caused by floods,
earthquakes, other Acts of God, fires,pandemics as declared by federal, state, or local emergency
resolution, wars, riots or similar hostilities, strikes and other labor difficulties beyond the Party's
control (including the Party's employment force), court actions (such as restraining orders or
injunctions), or other causes beyond the Party's control, including delays by any governmental
entity (although the City may not benefit from this provision for a delay that results from City's
failure to perform its obligations under this Agreement), or an insurance company of either party.
Page 23
5 53 94.00101\43 7215 67.1
If any such events shall occur, the term of this Agreement and the time for performance by either
Party of any of its obligations hereunder may be extended by the written agreement of the Parties
for the period of time that such events prevented such performance.
8.15 Mutual Covenants. The covenants contained herein are mutual covenants and
also constitute conditions to the concurrent or subsequent performance by the Party benefited
thereby of the covenants to be performed hereunder by such benefited Party.
8.16 Successors in Interest. The burdens of this Agreement shall be binding upon,
and the bone-fits of this Agreement shall inure to, all permitted successors in interest to the Parties
to this Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes
and constitute covenants running with the land. Each covenant to do or refrain from doing some
act hereunder with regard to development of the Property: (a) is for the benefit of and is a burden
upon every portion of the Property; (b) runs with the Property and each portion thereof; and(c) is
binding upon each Party and each successor in interest approved pursuant to this Agreement during
ownership of the Property or any portion thereof.
8.17 Counterparts. This Agreement may be executed by the Parties in counterparts,
which counterparts shall be construed together and have the same effect as if all of the Parties had
executed the same instrument.
8.18 Jurisdiction and Venue. Any action at law or in equity under this Agreement or
brought by a Party hereto for the purpose of enforcing, construing or determining the validity of
any provision of this Agreement shall be filed and tried in the Superior Court of the County of
Orange, State of California, or to the extent allowed by law, in the federal court district covering
the City, and the Parties hereto waive all provisions of law providing for the filing, removal or
change of venue to any other court.
8.19 Project as a Private Undertaking. It is specifically understood and agreed by and
between the Parties hereto that the development of the Project is a private development,that neither
Party is acting as the agent of the other in any respect hereunder, and that each Party is an
independent contracting entity with respect to the terms, covenants and conditions contained in
this Agreement. No partnership,joint venture or other association of any kind is formed by this
Agreement. The only relationship between City and Developer is that of a government entity
regulating the development of private property and the Developer of such property.
8.24 Further Actions and Instruments. Each of the Parties shall cooperate with and
provide reasonable assistance to the other to the extent conten-1plated hereunder in the performance
of all obligations under this Agreement and in the satisfaction of the Project and conditions of this
Agreement. Upon the request of either Party at any time, the other Party shall promptly execute,
with acknowledgment or affidavit if reasonably required, and file or record such required
instruments and writings and take any actions as may be reasonably necessary under the terms of
this Agreement to carry out the intent and to fulfill the provisions of this Agreement or the Project
or to evidence or consummate the transactions contemplated by this Agreement. City hereby
authorizes City Manager to take such other actions and negotiate and execute any additional
agreements or amendments to this agreement as may be reasonably necessary or proper to fulfill
Page 24
55344,00 t 01\43721567.1
the City's obligations under this Agreement. The City Manager may delegate her or his powers
and duties under this Agreement to an authorized management level employee of the City.
8.21 Estoppel Certificate. Within ten (10) business days following a written request
by any of the Parties, the other Party shall execute and deliver to the requesting Party a statement
certifying that (i) either this Agreement is unmodified and in full force and effect or there have
been specified (date and nature) modifications to the Agreement, but it remains in full force and
effect as modified; and (ii) either there are no known current uncured defaults under this
Agreement or that the responding Party alleges that specified (date and nature) defaults exist. The
statement shall also provide any other reasonable information requested. The failure to timely
deliver this statement shall constitute a conclusive presumption that this Agreement is in fall force
and effect without modification, except as may be represented by the requesting Party, and that
there are no uncured defaults in the performance of the requesting Party, except as may be
represented by the requesting Party.
8.22 No Subordination. City's approval of the necessary land use entitlements that
authorize Developer to develop, operate, and maintain the Project was based upon Developer's
obligation to provide the Affordable Units pursuant to the State Density Bonus Law, City Density
Bonus for Affordable Housing, and the terms and conditions of this Agreement. For the duration
of the Term, this Agreement shall have priority over any and all mortgages, deeds of trust, and
other similar forms of secured financing recorded against the Property or any portion thereof,
unless otherwise approved by City in writing. Developer expressly understands and acknowledges
that state law requires preservation of Affordability Covenants in connection with the approval of
this density bonus project.
8.23 Mortgagee Protections. Notwithstanding anything to the contrary set forth
elsewhere herein, Developer may obtain financing for the development and construction of the
Project, which financing may be secured by a lien or charge of a mortgage, deed of trust, or other
security interest then of record made in good faith and for value(a"Mortgage")without the City's
consent; provided, however, that the Mortgage is subject to and subordinate to this Agreement
unless otherwise approved by the City in writing, in its sole and absolute discretion. Upon the
written request therefore by any holder of a Mortgage (a "Mortgagee"), the City shall provide
such Mortgagee copies of any notice of default or demand to perform provided to Developer under
this Agreement substantially concurrently with its delivery to Developer and agrees that such
Mortgagee may,but is under no obligation to, cure any such default pursuant to Section 6. In the
event a Mortgage exists for which City has received notice from the Mortgagee pursuant to this
Section, this Agreement shall not be amended, supplemented, restated or otherwise modified in
any manner without the prior written consent of such Mortgagee, which shall not be unreasonably
withheld, conditioned, or delayed. The City's rights pursuant to Section 6 shall be superior to,but
shall not render invalid, any mortgage or deed of trust recorded against the Property or any portion
thereof, including without limitation, any Affordable Unit. Notwithstanding any other provision
in this Agreement to the contrary, this Agreement shall not diminish or affect the rights of the
California Housing Finance Agency ("CaIHFA"), HUD, the Federal National Mortgage
Association ("FNMA"), or the Veterans Administration ("VA") under any mortgage recorded
against the Property in compliance with the Declaration. The City further agrees to execute and
deliver to Mortgagee such further and other documents as Mortgagee may reasonably require to
effect the purpose and intent of this Section.
Page 25
55394.00101\43721567.1
8.24 Attorneys' Fees and Costs. If either 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.
8.25 Authority to Execute. The person or persons executing this Agreement on behalf
of each Party warrants and represents that he or she/they have the authority to execute this
Agreement on behalf of his or her/their corporation, partnership or business entity and warrants
and represents that he or she/they has/have the authority to bind the Party to the performance of its
obligations hereunder.
(Signatures on following page)
Page 26
55394,00101\43721567.1
IN WITNESS WHEREOF, the parties hereto have caused this Density Bonus Housing
Agreement to be executed on the date set forth at the beginning of this Agreement.
ATTEST: CITY OF SANTA ANA
Jennifer Hall Alvaro Nunez
City Clerk City Manager
APPROVED AS TO FORM:
By: [NAME]
City Attorney
RECOMMEND FOR APPROVAL: Santa Ana 8 Inv,LLC, a Delaware limited
liability company
Michael Garcia By: L
Executive Director Its: 7c ; tRes
f�rem-f-
Community Development Agency
Page 27
5 5 3 94.00101/43 721567.1
IN WITNESS WHEREOF, the parties hereto have caused this Density Bonus Housing
Agreement to be executed on the date set forth at the beginning of this Agreemen
ATTEST: it- CITY OF ANTA ANA
ennifer 1 ro Nunez
City Cler City Manager
APPROVED AS TO FORM:
)z
By: [NAME] MATTHEW R.CODY
City Attorney
RECOMMEND FOR APPROVAL: Santa Ana S Inv,LLC,a Delaware limited
liability company
Michael Garcia By: 714,
Executive Director Its: i` x d c u ,ref. , c t (�l`+vS DCV6)0F 01eMt
Community Development Agency
Page 27
55394.00 10 1 A372156T 1
CALIFORNIA ACKNOWLEDGMENT CIVIL CODE § 1189
A notary public or other officer completing this certificate verifies only the identity ofthe 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 C C !}
On 9� rQQ before me, s5 k � . j• L � i �Lt. pi�
Date H re In ert!Name and Title of he Officer
personally appeared 9 1 +- _
Ngm (s)of Signer(s)
who proved to me on the basis of satisfactory evidence to be the personN whose nameis/ ubscribed
to the within instrument and acknowledg to me that he he hey executed the same in Fiis her their
authorized capacityx, and that by his �e `their signal eeVon the instrument the person k or the entity
upon behalf of which the personV acted, executed the instrument.
certify under PENALTY OF PERJURY under the
laws of the State of California that the foregoing
16my
sERUSHABELLES paragraph is true and correct.
Notary Public•California Zorange County
Commission#2466078 WITNESS my hand and official seal.
comm.Expires Oct10.2027
Signature
Place Notary Seal and/or Stamp Above Si nature of Notary Public
OPTIONAL
Completing this information con deter alteration of the document or
froudulent reattachment of this form to an unintended document.
Description of Attached Document
Title or Type of Document:
Document Date: Number of Pages
Signer(s) Other Than Named Above:
Capacity(ies) Claimed by Signer(s)
Signer's Name: Signer's Name:
❑ Corporate Officer— Title(s): ❑ Corporate Officer— Title(s):
❑ Partner— ❑ Limited ❑ General ❑ Partner— ❑ Limited ❑ General
❑ Individual ❑ Attorney in Fact ❑ Individual ❑ Attorney in Fact
❑ Trustee ❑ Guardian or Conservator ❑ Trustee ❑ Guardian or Conservator
❑ Other: ❑ Other:
Signer is Representing: Signer is Representing:
02019 National Notary Association
CALIFORNIA ACKNOWLEDGMENT CIVIL CODE § 1189
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 Or-oingt
On �� 20213 before me, E QF j q n T. ^AyycA . N o+rAry
fiu��Iti
Dote //�� T Here Insert Nome and Title of the Officer
personally appeared Al V ciro U LR Z
Name(s)of Signer(s)
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.
certify under PENALTY OF PERJURY under the
laws of the State of California that the foregoing
EVELYN Ig= paragraph is true and correct.
Notary Public.California
orange county
Cornmission 0 2489063 WITNESS my hand and official seal.
.My Comm.Expires May 3,2028
Signature
Place Notary Seal and/or Stomp Above 14at of Notary Public
OPTIONAL
Completing this information can deter alteration of the document or
fraudulent reattachment of this form to an unintended document.
Description of Attached Document
Title or Type of Document:
Document Date: Number of Pages:
Signer(s) Other Than Named Above:
Capacity(ies) Claimed by Signer(s)
Signer's Name: Signer's Name:
❑ Corporate Officer— Title(s): ❑ Corporate Officer — Title(s):
❑ Partner— ❑ Limited ❑ General ❑ Partner-- ❑ Limited ❑ General
❑ Individual ❑ Attorney in Fact ❑ Individual ❑ Attorney in Fact
❑ Trustee ❑ Guardian or Conservator ❑ Trustee ❑ Guardian or Conservator
❑ Other: ❑ Other:
Signer is Representing: Signer is Representing:
02019 National Notary Association
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SANTA ANA IN THE COUNTY OF
ORANGE, STATE OF CALIFORNIA,AND IS DESCRIBED AS FOLLOWS:
PARCEL 1:
THAT PORTION OF THE NORTHEAST QUARTER OF THE SOUTHEAST QUARTER OF SECTION 9,
TOWNSHIP 5 SOUTH, RANGE 10 WEST,S.B.B.&M.DESCRIBED AS FOLLOWS:
BEGINNING AT THE SOUTHEAST CORNER OF THE NORTHEAST QUARTER OF THE SOUTHEAST
QUARTER OF SECTION 9,TOWNSHIP 5 SOUTH,RANGE 10 WEST, S.S.B_&M.;
THENCE NORTH 10 CHAINS;
THENCE WEST 6 CHAINS;
THENCE SOUTH 10 CHAINS;THENCE EAST 6 CHAINS TO THE POINT OF BEGINNING.
EXCEPT THEREFROM THE NORTH 5-516THS CHAINS.
PARCEL 2:
THE RIGHT TO USE THE REPLACE AND REPAIR THE EXISTING IRRIGATING PIPE LINE NEAR.THE WEST
LINE OF THE NORTH 5-516THS CHAINS.
APN: 100-631-04(PORTION)
APN: 100-631-05(PORTION)
Page 28
Exhibit A
Legal Description of the Property
55394.00101\43721567,2
EXHIBIT B
FORM OF AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY SHARING,AND
REGULATORY AGREEMENT
RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO;
City of Santa Ana
20 Civic Center Plaza(M-30)
P.O. Box 1988
Santa Ana, CA 92702
Attn: City Cleric
Free Recordingpursuant to
Government Code 6103&27383
AFFORDABLE HOUSING RESALE RESTRICTIONS,EQUITY SHARING AND
REGULATORY AGREEMENT
(Address; APN)
This AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY SHARING
AND REGULATORY AGREEMENT ("Affordable Housing Resale Restrictions" or
"Agreement") is made as of , by ("Homebuyer") in favor of
the CITY OF SANTA ANA, a municipal corporation ("City").
RECITALS
A. Homebuyer has purchased a single family house located at ,
Santa Ana, California, , as such real property is more particularly described in "Exhibit I"
attached hereto and incorporated herein ("Property").
B. In connection with Homebuyer purchasing the Property, Homebuyer
acknowledged and received disclosures that the purchase was subject to a Density Bolnus Housing
Agreement with Declaration of Covenants, Conditions and Restrictions ("Density Bonus
Agreement"), dated on or about , 2025, between the developer of the Property,
("Developer"). The Density Bonus Agreement required the Property to be sold
to a Moderate Income Household, subject to the provisions of this Affordable Housing Resale
Restrictions, pursuant to which Developer imposed covenants upon the Property to be sold to
Eligible Homebuyers at an Affordable Sales Price. Homebuyer hereby acknowledges and agrees
that this Affordable Housing Resale Restrictions is intended to implement the requirements of the
Density Bonus Agreement, and that the purchase, use and occupancy of the Property is subject to
the conditions, covenants and restrictions contained herein. Capitalized terms used herein and not
otherwise defined shall have the same meaning as set forth in the Density Bonus Agreement.
Page 29
Exhibit B
55394.00101/43 721567.1
C. Homebuyer desires and intends to restrict the Property and the improvements
thereon in accordance with this Affordable Housing Resale Restrictions. Homebuyer agrees and
acknowledges that this Affordable Housing Resale Restrictions is intended to implement and
further the intent of the Density Bonus Agreement, entered into between City and Developer of
the Property,which was recorded against the Affordable Unit to impose the conditions, covenants,
and restrictions as set forth herein. This Affordable Housing Resale Restrictions shall be construed
in accordance with the Regulatory Agreement.
D. Homebuyer is a Moderate Income Household, as that term is defined in this
Agreement.
E. Homebuyer has represented to City that Homebuyer and Homebuyer's household
intend to reside in the Property as Homebuyer's principal residence at all times during
Homebuyer's ownership of the Property.
NOW,THEREFORE, for good and valuable consideration, the parties agree as follows:
1. DEFINITIONS
"Affordability Term" means that period of time commencing upon the Date of this
Agreement and terminating on the date that is fifty-five (55) years from the date a Certificate of
Occupancy was issued for the Property.
"Affordable Mousing Cost"means the purchase price for Moderate Income Households
pursuant to California Health & Safety Code Section 50052.5, and implementing regulations of
Sections 6920, 6924 and 6930 of Title 25 of the California Code of Regulations for Moderate
Income Households. The Affordable Housing Cost shall not exceed thirty-five percent (35%)
times one hundred ten percent(110%) of the Orange County Median Income for a household size
appropriate to the unit, pursuant to Santa Ana Municipal Code.
"Affordable Sales Price"means a purchase price required under a written purchase sale
agreement that does not exceed the sum of the Supportable Mortgage plus the Benchmark Down
Payment,
Affordable Unit" or"Property"means the individual dwelling unit restricted by this
Agreement
"City"means the City of Santa Ana, California, a California municipal corporation, and
the City's successors and assigns.
"City Deed of Trust"means the City Deed of Trust, securing this Affordable Housing
Resale Restrictions and the City Promissory Note, and dated on or about the same date hereof.
"City Equity Share"means the amount that Homebuyers agree to pay to the City in
accordance with the City Promissory Note.
"City Promissory Note"means the City Promissory Note, evidencing Homebuyer's
agreement to pay the City Equity Share and dated on or about the same date hereof.
Page 30
Exhibit B
55 394.0010 1\43721567.1
"County"means the County of Orange, California.
"Date of this Agreement"means the date in the first paragraph of this Agreement.
"Default"means the failure of a party to perform any action or covenant required by this
Agreement within the time periods provided herein following notice and opportunity to cure.
The term default also includes an Ownership Default and a Maintenance Default as more fully
defined and described herein. Notwithstanding the foregoing for purposes of acceleration of the
City Promissory Note,or initiation of foreclosure proceedings there shall be a distinction between
the types of default hereunder, including an "Ownership Default" and a "Maintenance Default."
The term"Ownership Default"means the failure of Homebuyer to perform any action or covenant
required by the Affordable Housing Resale Restriction related to ownership, owner-occupancy,
lien priority, and restrictions on sale and resale of the Property subject to the notice and opportunity
to cure provisions set forth herein. A default of any obligation secured by the First Lien shall be
a cross-default and also constitute an Ownership Default. The term"Maintenance Default"means
the failure of Homebuyer to perform any action or covenant required by this Agreement relating
to a "Maintenance Deficiency," including the ongoing upkeep, maintenance, and use of the
Property in decent, safe, sanitary, clean, and neighborly manner, subject to the notice and
opportunity to cure provisions set forth herein (and expressly excluding an Ownership Default).
"Developer"means Alminlo Properties, a California limited liability company .
"Eligible Household" means a Household whose income does not exceed the "Moderate
Income Household" qualifying limit as defined herein.
"First Lien"means the lien of the institution making the purchase money mortgage loan
to Homebuyer for the purchase of the Property.
"Homebuyer" means the person or persons set forth in the first paragraph of this
Agreement, and their successors and assigns.
"Housing Cost"means and includes all of the following costs associated with ownership
of an Affordable Unit as defined in Title 25 of the California Code of Regulations Section 6920,
and Santa Ana Municipal Code, including:
(a) Principal and interest on a mortgage loan at the defined interest rate;
(b) Property tax and assessments;
(c) Fire and casualty insurance covering replacement value of property
improvements;
(d) Property maintenance and repairs;
(e) A reasonable utility allowance, as determined by the Orange County
Housing Authority; and
(fj Homeowner Association assessments and dues.
Page 31
Exhibit B
553 94.00101\43721567.1
"Legal Description"means the legal description of the Property which is attached hereto
as Exhibit A and incorporated herein.
"Median Income"means the area median income for Orange County PMSA, Adjusted
for Family Size Appropriate to the unit pursuant to California Health and Safety Code §
50052.5(h), as periodically published by the California Department of Housing and Community
Development.
"Moderate Income" and "Moderate Income Households" means moderate income
households as defined in Health & Safety Code Section 50079.5, with Gross Income for the
Household that does not exceed one hundred twenty percent (120%) AMI.
"Notice of Intent to Transfer" means a written notice from Homebuyer to the City that
provides notice of an intent to Transfer the Property and all information required by this Agreement
in connection with the proposed Transfer.
"Permitted Transfer"means any Transfer which is permitted under this Agreement with
the written consent of the City.
"Prohibited Transfer"means any Transfer which is disapproved by the City or violates
this Agreement.
"Property"means that certain real property located at the street address set forth in Recital
A and legally described in the Legal Description.
"Purchase Agreement"means that certain agreement pursuant to which Homebuyer has
agreed to purchase the Property from the Developer.
"Request for Notice"means the Request for Notice of Default attached hereto as Exhibit
I and incorporated herein.
"Sales Price"means the sum to be paid by a Transferee for the Transfer of the Property.
"Transfer" shall mean any sale, assignment, conveyance, lease or transfer, voluntary or
involuntary, of any interest in the Property. Without limiting the generality of the foregoing,
Transfer shall include (i) a transfer by devise, inheritance or intestacy; (ii) creation of a life estate;
(iii) creation of a joint tenancy interest; (iv) a gift of all or any portion of the Property; or (v) any
voluntary conveyance of the Property.
"Transferee"shall mean any natural person or entity who obtains ownership or possessory
rights in the Property pursuant to a Transfer.
2. HOMEBUYER'S REPRESENTATIONS AND WARRANTIES AS TO THE SALE OF
THE PROPERTY TO HOMEBUYER.
2.1 Homebuyer represents and warrants to City that the financial and other
information which Homebuyer has provided to City with respect to Hornebuyer's income and the
Page 32
Exhibit B
55394.00101\43721567.1
purchase price of the Property was true and correct at the time such information was provided, and
remains true and correct as of the Date of this Agreement.
2.2 Homebuyer agrees to occupy the Property as Homebuyer's primary residence.
3. RESTRICTIONS ON SALE OF PROPERTY.
3.1 Homebuyer covenants and agrees that during the Affordability Term, any resale
of the Property shall be to a Moderate Income Household for an amount that does not exceed an
Affordable Sales Price.
3.2 Prior to any Transfer of the Affordable Unit, Homebuyer shall provide the City
with a Notice of Intent to Transfer, in a form approved by the City, and the City shall have the
right to approve or disapprove of any Transfer,which approval shall not be unreasonably withheld.
3.3 Permitted Transfers. Prior to any Transfer of the Property, Homebuyer shall
obtain City's written consent pursuant to the requirements of Section 4 and 5, below, and subject
to the following:
(a) During the Affordability Term, the Homebuyer may Transfer the
Property to a Moderate Income Household for an Affordable Sales Price.
(b) Upon expiration of the Affordability Term,Homebuyer may sell the
Property without the affordability restrictions of this Agreement, subject to the satisfaction of the
City Promissory Note and City Deed of Trust.
3.4 Prohibited Transfers, Any Transfer of the Property without the City's written
consent or in violation of this Agreement is a Prohibited Transfer.
4. HOMEBUYER PROCEEDS FROM SALE OF PROPERTY,
4.1 This Agreement implements the provisions of the Density Bonus Agreement
for disbursement of funds from a sale of the Property, as further set forth below.
4.2 Permitted Transfers During the Affordability Terin. During the Affordability
Term, a Homebuyer retains the proceeds from a Permitted Transfer after payment of the First
Lien, and reasonable closing costs and broker fees. The City Deed of Trust shall remain a lien
on the Property, or the Transferee shall executed a new Affordable Housing Resale Restrictions,
City Promissory Note, and City Deed of Trust,
4.3 Permitted Transfers Upon Expiration of the Affordability Term. Upon
expiration of the Affordability Tenn, the City Equity Share shall become due and payable upon a
Permitted Transfer, and the proceeds from a sale shall be used for payment of the City Equity
Share in satisfaction of the City Promissory Note.
4.4 Prohibited Transfers. Homebuyer agrees and acknowledges that a Prohibited
Transfer is a default of this Agreement and, in the event of such a default,the City shall be entitled
Page 33
Exhibit B
55394.001 01\43721567.1
to the greater of (a) all amounts paid for the Property in excess of the Affordable Sales Price shall
be forfeited to the City, or (b) the City Equity Share.
4.5 Equity Sharing Agreclnent.
4.5.1 Following the expiration of the Affordability Term, Holnebuyer agrees to
pay to the City the City Equity Share, as follows:
4.5.2 The City Equity Share shall be paid out of proceeds from a Transfer of the
Property after the Affordability Term.
4.5.3 The City Equity Share includes the following;
(a) An amount equal to the difference between the fair market value of
the Affordable Unit at the time of the initial purchase and the Affordable Sales Price (the "Initial
Subsidy").
(b) An amount equal to the product of (1) the appreciation of the
Affordable Unit, as measured by the increase in the fair market value of the Affordable Unit at the
time of the sale to the Homebuyer and the resale of the Affordable Unit, and (2) the percentage
that the initial subsidy represented of the fair market value of the Affordable Unit when it was
purchased by the Homebuyer(the"Proportionate Share of Appreciation").
4.6 The City Equity Share shall only be subordinate to a First Lien, as approved by
the City at the time of the initial sale (or subsequent approval in the event of a refinance or resale
during the Affordability Term), and amounts owed to Homebuyer for the value of improvements
to the Property and the down payment paid by Homebuyer.
4.7 For purposes of determining the City Equity Share, at the time of the initial sale
of the Property, and each re-sale during the Affordability Tenn, the fair market value shall be
determined as follows:
4.7.1 For the initial sale, Developer may propose to the City a fair market value
based on a price per square foot that is based on comparable sales of other units within the Project.
4.7.2 Except as approved in writing by the City,prior to the sale of an Affordable
Unit, a qualified appraiser shall conduct an appraisal of the Affordable Unit to determine fair
market value without the restrictions of this Agreement. If the Developer or a prospective
Homebuyer disputes the appraised value,then that party may pay for the costs of a second appraisal
and, if there is still disagreement, the average of the two appraisals shall be used to determine the
fair market value.
4.7.3 The fair market value of the Affordable Unit, as determined in accordance
with the above, shall be provided to the City for approval or disapproval, which City shall provide
within thirty (30) days of receipt of the proposed fair market value. If City does not provide a
written response within such time period, then the proposed fair market value shall be deemed
approved by the City.
Page 34
Exhibit B
55394.00101\43721567.1
5. PROCESS FOR TRANSFER OF THE PROPERTY. In the event that Homebuyer desires
to Transfer the Property, the following procedure shall apply:
5.1 Notice to City. Prior to any Transfer, Homebuyer shall send a completed Notice
of Intent to Transfer to City at the address set forth in Section 22. The Notice of Intent to Transfer
shall include: (a)the identity of the proposed Transferee and contact information,including current
address and phone number, (b) the proposed terms of the Transfer, (c) whether the Property is
being sold to a purchaser that qualifies as a Moderate Income Household and supporting
documentation, and (d) if during the Affordability Term, the proposed Affordable Sales Price and
the resulting Monthly Housing Costs. If the proposed Transfer is upon expiration of the
Affordability Term, then the Notice of Intent to Transfer shall include the proposed sales price and
a good faith estimate of the proceeds from the sale of the Property.The City may request additional
information as reasonably necessary to evaluate the requested Transfer.
5.2 Qualification of Proposed Transferee. For a transfer during the Affordability
Term, the proposed Transferee shall complete an Income Verification Form, in a form approved
by the City,which shall include,without limitation, a certification as to the income and family size
of the proposed Transferee.
5.3 Certificates from Parties. In the event the City approves the proposed Transfer,
Homebuyer and proposed Transferee each shall certify in writing, in a form acceptable to City,
that the Transfer shall be closed in accordance with the terms of the sales contract and other
documents submitted to and approved by City and that all consideration delivered by the proposed
Transferee to owner has been fully disclosed to City. The written certificate shall also include a
provision that 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 have the right to file an action at law or in equity to make the
parties terminate and/or rescind the sales contract and/or declare the sale void notwithstanding the
fact that the Transfer may have closed and become final as between Homebuyer and Transferee.
5.4 Requirements for Permitted Transfers. For a Permitted Transfer during the
Affordability Tenn, the City will require: (1) an assignment and assumption agreement that is
reasonably acceptable to City,or(2)the proposed Transferee execute a new City Promissory Note,
City Deed of Trust, and Affordable Housing Resale Restrictions. Upon expiration of the
Affordability Term, the City will require a closing statement setting forth the proceeds from a
proposed sale, and shall have at least thirty(30) days to review and approve the sales documents.
5.5 Written Approval of City Required Before Transfer. The purchase sale
agreement or other contract for Transfer of the Property, and the Income Verification Form, shall
be provided to the City,which shall have at least thirty(30) days to review. The Property, and any
interest therein, shall not be conveyed by any Transfer except with the express written consent of
City, which consent shall be given only if the Transfer is in accordance with the provisions of this
Agreement.
5.6 Notice of Prohibited Transfer. Within thirty (30) days after receiving all
information required by this Section 5,the City shall determine and give notice to Homebuyer as
to whether the City consents to the Transfer as a Permitted Transfer, or if the City determines the
Page 35
Exhibit B
553 94.00101\43721567.1
proposed Transfer is a Prohibited Transfer, Any attempt to Transfer the Property without the City's
written approval, or after the City has given notice of a Prohibited Transfer, shall be a Default of
this Agreement, and the City may apply to a court of competent jurisdiction for specific
performance of this Agreement, for an injunction prohibiting a proposed sale or Transfer in
violation of this Agreement, for a declaration that the Prohibited Transfer is void, or for any such
other relief as may be appropriate.
5.7 Delivery of Documents. Upon the close of the proposed Transfer,Homebuyer and
Transferee, as applicable, shall provide the City with a copy of the final sales contract, settlement
statement, escrow instructions, all certificates required by this Section 5 and any other documents
City may request.
6. ENCUMBRANCES.
6.1 Subordination. Except as provided otherwise herein, the provisions of this
Agreement, the Notice of Affordability Restrictions and the City Deed of Trust, the obligations
herein and therein, shall be subordinate only to the First Lien on the Property and, if applicable,
other loan(s) as approved by the City, including lien instruments that secure other Homebuyer
purchase money and/or down payment assistance, including without limitation City, State of
California, or federal affordable housing programs, which liens shall not impair the rights under
the First Lien in the event of default under the First Lien by Homebuyer. Such remedies under the
First Lien include the right of foreclosure or acceptance of a deed or assignment in lieu of
foreclosure,
6.2 Request for Notice of Default. City 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 California Civil Code Section 2924b. A form
of a Request for Notice is attached hereto as Exhibit I and incorporated herein.
6.3 Further Encumbrances. Homebuyer agrees that it shall not record or cause the
recordation of any deed of trust ("Further Encumbrance") securing a note having an original
principal sum which, when added to the sum of the principal amount(s) of any notes secured by
any deeds of trust against the Property as of the date of recordation of the Further Encumbrance,
exceeds one hundred percent(100%) of the fair market value of the Property.
7, USES. Homebuyer covenants and agrees to devote, use and maintain the Property in
accordance with this Agreement. All uses conducted on the Property, including, without
limitation, all activities undertaken by Homebuyer pursuant to this Agreement, shall conform to
all applicable provisions of the Santa Ana Municipal Code, and the recorded documents pertaining
to and running with the Property.
8. NONDISCRIMINATION COVENANTS
Homebuyer covenants by and for itself, its successors and assigns, and all persons claiming under
or through thein that there shall be no discrimination against or segregation of,any person or group
of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the
Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (in) and
Exhibit B Page 36
5 5394.00 10 A43721567.1
paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code,
in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein
conveyed, nor shall the grantee or any person claiming under or through him or her, establish or
permit any practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the
premises herein conveyed. The foregoing covenants shall run with the land. All deeds, leases or
contracts relating to the Property, or any part thereof, shall contain or be subject to substantially
the following non-discrimination or non-segregation clauses:
"The grantee herein covenants by and for himself or herself, his or her heirs, executors,
administrators,and assigns,and all persons claiming under or through them,that there shall
be no discrimination against or segregation of, any person or group of persons on account
of any basis listed in subdivision (a) or(d) of Section 12955 of the Government Code, as
those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the
sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein
conveyed, nor shall the grantee or any person claiming under or through him or her,
establish or permit any practice or practices of discrimination or segregation with reference
to the selection, location, number, use or occupancy of tenants, lessees, subtenants,
sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run
with the land."
The covenants established in this Section 8 shall,without regard to technical classification
and designation, be binding for the benefit and in favor of City and its successors and assigns, and
shall remain in effect in perpetuity,
9, MAINTENANCE OF PROPERTY.
Homebuyer shall maintain the improvements and landscaping on the Property in a manner
consistent with community standards which will uphold the value of the Property, in accordance
with the Santa Ana Municipal Code. Homebuyer also agrees to comply with all applicable federal,
state and local laws.
9.1 Exterior Maintenance, Except as to be maintained by the homeowners
association, as applicable, all exterior, painted surfaces of any structures located on the Property
shall be maintained at all times in a clean and good condition. Any defacing marls shall be cleaned
or removed within a reasonable period of time.
9.2 Front and Side Exteriors. Except as to be maintained by the homeowners
association,as applicable,Homebuyer shall at all tiYnes maintain the front exterior,any visible side
exteriors, and yards, if any, in a clean, safe and presentable manner.
9.3 Graffiti Removal. All graffiti and defacement of any type, including but not
limited to marks, words and pictures, shall be promptly removed from the Property within two (2)
days of the time they were made and any necessary painting or repair completed in a timely and
expeditious manner after notice thereof, whichever is less.
Page 37
Exhibit B
55394,00101\43721567.1
9.4 No Nuisance. Homebuyer shall not maintain, cause to be maintained, or allow
to be maintained on or about the Property any public or private nuisance, including without
limitation, the conduct of criminal activities set forth in the nuisance abatement provisions of the
Uniform Controlled Substances Act (Health & Safety Code Sections 11570, et seq.) or the Street
Terrorism Enforcement and Prevention Act(Penal Code Sections 186.22 et seq.),or any successor
statute or law.
10. OCCUPANCY STANDARDS.
The Property shall be used as the principal personal residence of Homebuyer and Homebuyer's
immediate family/household and for no other purpose. Homebuyer shall not enter into an
agreement for the rental or lease of all or any part of the Property. Homebuyer shall not rent out a
room or rooms at the Property. Homebuyer may request a temporary waiver of the foregoing
requirement in the event of extreme hardship requiring Homebuyer to move to another
geographical area or to less expensive housing, including, for example and without limitation,
transfer of job location, loss of job, or unexpected major expenses. City may approve or
disapprove such request in its sole discretion, and may require as a condition of approval that
Homebuyer only rent the Property to Eligible Households at an affordable rent (as defined in
Section 50052.5 and 50053 of the California Health & Safety Code.) Subject to applicable state
or federal law, the standard occupancy for the Property shall be consistent with the Regulatory
Agreement. Homebuyer shall, upon demand by City, submit to City an affidavit of occupancy
verifying Homebuyer's compliance with this Section 10. Such affidavit may be required by City
on an annual basis.
11. EFFECT OF VIOLATION OF THE TERMS AND PROVISIONS OF THIS
AGREEMENT.
11.1 In General. The covenants established in this Agreement shall, without regard
to technical classification and designation, be binding for the benefit and in favor of City, its
successors and assigns, as to those covenants which are for its benefit. The covenants contained
in this Agreement shall remain in effect for the periods of time specified herein. The covenants
against discrimination shall remain in effect in perpetuity. City is deemed the beneficiary of the
terms and provisions of this Agreement and of the covenants running with the land, for and in its
own rights and for the purposes of protecting the interests of the community and other parties,
public or private, in whose favor and for whose benefit this Agreement and the covenants rumling
with the land have been provided. This Agreement and the covenants herein shall run in favor of
City,without regard to whether City has been,remains or is an owner of any land or interest therein
in the Property or in the Project Area. City shall have the right, if the Restriction or covenants are
breached,to exercise all rights and remedies,and to maintain any actions or suits at law or in equity
or other proper proceedings to enforce the curing of such breaches to which it or any other
beneficiaries of this Agreement and covenants may be entitled.
11.2 Acceleration. The City shall be entitled to accelerate payments due under the
City Promissory Note, and the amount required thereunder shall become due and immediately
payable to City by Homebuyer upon the occurrence of any one of the following events of
acceleration:
Page 38
Exhibit B
55394,00101\43721567.1
11.2.1 During the Affordability Tenn, Homebuyer Transfers the Property for a
price in excess of an Affordable Sales Price or to a Transferee who does not qualify as a Moderate
Income Household;
11.2.2 Homebuyer makes a Prohibited Transfer of title to or any interest in the
Property without City's consent or in violation of this Agreement;
11.2.3 Homebuyer refinances any lien or encumbrance to which City Deed of Trust
is subordinate (each such lien, a"First Lien") for a loan amount in excess of the then current loan
balance secured by such lien or encumbrance and loan closing costs;
11.2.4 Homebuyer fails to occupy the Property as Homebuyer's principal
residence or is in Default of any other obligation under the Affordable Housing Resale
Restrictions;
11.2.5 Homebuyer has an Ownership Default violating any affordable housing
terms or provisions of this Agreement.
12. COMPLIANCE WITH LAWS,• GOVERNING LAW.
Homebuyer hereby agrees to comply with all applicable ordinances,rules, and regulations of City.
Nothing herein 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 declaration must be instituted in the Superior Court of the County of
Orange, State of California, or in the Federal District Court in the Central District.
13. INDEMNIFICATION.
Homebuyer shall pay for, defend, indemnify and hold harmless City and the City and their
respective officers, officials, agents, employees, representatives, and volunteers from and against
any loss, liability, claim, or judgment relating in any manner to Homebuyer's use of the Property
or Homebuyer's violation of this Agreement. Homebuyer shall remain fully obligated for the
payment of taxes, liens and assessments related to the Property. There shall be no reduction in
taxes for Homebuyer, nor any transfer of responsibility to City to snake such payments, by virtue
of this Agreement.
14. INSURANCE,
Homebuyer shall maintain,during the tenn of this Agreement,an all-risk property insurance policy
insuring the Property in an amount equal to the full replacement value of the structures on the
Property. The policy shall contain a statement of obligation on behalf of the carrier to notify the
City of any material change, cancellation or termination of coverage at least thirty (30) days in
advance of the effective date of such material change, cancellation or tenmination. Homebuyer
shall transmit a copy of the certificate of insurance to City within thirty (30) days of the effective
Date of this Agreement, and Homebuyer shall annually transmit to City a copy of the certificate
of insurance, signed by an authorized agent of the insurance carrier setting forth the general
provisions of coverage. The copy of the certificate of insurance shall be transmitted to City at the
Exhibit B Page 39
55394,00101\43721567.1
address set forth in Section 22 hereof. The form, content and issuer of any certificate of insurance
approved by City.
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, that 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 party
who so fails or delays must immediately commence to cure, correct or remedy such failure or
delay, and shall complete such cure, correction or remedy with diligence. 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.
Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it
change the time of default.
16. 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.
17. FURTHER ASSURANCES.
Homebuyer 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.
18. GOVERNING LAW.
Homebuyer 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 where the City is located.
19. AMENDMENT OF RESTRICTION.
No modification, rescission, waiver, release or amendment of any provision of this Agreement
shall be made except by a written agreement executed by Homebuyer and City.
20. CITY MAY ASSIGN.
City may, at its option, assign its rights hereunder without obtaining the consent of Homebuyer.
21, HOMEBUYER ASSIGNMENT PROHIBITED
Page 40
Exhibit B
553 94.0010 1\43 721567.1
In no event shall Homebuyer assign or transfer any portion of this Agreement without the prior
express written consent of City, which consent shall be given by City only in the event that City
determines that the assignee or transferee is an Eligible Household, that the assignee's or
transferee's monthly housing payments are at an Affordable Housing Cost, and that the assignee
or transferee has expressly assumed this Agreement by execution of a written assignment
document to be provided by City and recorded against the Property, or execution of new
instruments by the transferee. This section shall not affect or diminish City's right to assign all or
any portion of its rights hereunder.
22. NOTICES'.
Any notices, requests or approvals given under this Agreement from one party to another may be
personally delivered or deposited with the United States Postal Service for mailing, postage
prepaid, registered or certified mail, return receipt requested to the following address:
To Homebuyer: At the property address.
To City: City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92702
Attn: City Clerk
Either party may change its address for notice by giving written notice thereof to the other
party.
23. ATTORNEYS' FEES AND COSTS.
In the event that any action is instituted to enforce payment ar performance under this Agreement,
the parties agree the non-prevailing party shall be responsible for and shall pay all costs and all
attorneys' fees incurred by such prevailing party in enforcing this Agreement.
24. ENTIRE AGREEMENT.
This Agreement, together with the City Promissory Note and City Deed of Trust, and all
attachments thereto and 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 the City and
Homebuyer concerning all or any part of the subject matter of this Agreement.
[Signature block begins on follow page.]
Exhibit B Page 41
5 5394.00 10 1\43721567.1
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.
HOMEBUYER:
By:
By:
CITY:
ATTEST: CITY OF SANTA ANA
By: By:
City Clerk City Manager
Dated: Dated:
Exhibit B Page 42
5 5394,00 101\43721 567.1
EXHIBIT 1 OF THE AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY
SHARING AND REGULATORY AGREEMENT
LEGAL DESCRIPTION
Page 43
Exhibit 1
of the Affordable Housing Resale Restrictions, et al.
5 5394,0010 1\43 721567.1
EXHIBIT C
FORM OF CITY PROMISSORY NOTE
City Equity Share [DATE]
Santa Ana, CA
1. FUNDAMENTAL PROVISIONS.
The following terms will be used as defined terms in this City Promissory Note (as it may be
amended, modified, extended and renewed from time to time, this "Note"):
Lender/Payee: City of Santa Ana, a California municipal corporation.
Borrower/Maker: [HOMEBUYER]
Principal Amount: City Equity Share, as defined in the Affordable Housing Resale
Restrictions
Interest Rate: None.
Default Interest Rate: Eight percent per annum.
Maturity Date: The date of a Transfer of the Property after expiration of the
Affordability Term.
Business Day: Any day of the year other than Saturdays, Sundays and legal
holidays on which City's main office is closed.
Property: [ADDRESS]
Deed of Trust: The City Deed of Trust executed by Borrower, as "Trustor", for the
benefit of City, as "Beneficiary," concurrently with this Note, and
recorded against the Property.
Affordable Housing
Resale Restrictions: The Affordable Housing Resale Restrictions, Equity Sharing and
Regulatory Agreement, dated on or about'[DATE],.
Loan: The agreement by Borrower to pay the Principal Amount to City, in
accordance with the Affordable Housing Resale Restrictions and
this Note.
City Documents: This Note, the Affordable Housing Resale Restrictions, the City
Deed of Trust
Page 44
Exhibit C
5 53 94.00101\43721567.1
2. PROMISE TO PAY, For value received, Borrower promises to pay to the City, at its
office at 20 Civic Center Plaza(M-30), Santa Ana, CA 92702, or at such other place as the
Lender hereof may from time to time designate in writing,the Principal Amount together with
interest thereon, and all other sums due wader and secured by the Deed of Trust.
3. SECURITY. This Note is secured by the City Deed of Trust. The holder of this Note will
be entitled to the benefits of the security provided by the City Deed of Trust and will have the
right to enforce the covenants and agreements of Maker contained therein and in the Affordable
Housing Resale Restrictions
4. PAYMENTS. The City Equity Share is due upon a Transfer of the Property after
expiration of the Affordability Term, or upon an event of Default. In the event any City Equity
Share become due and payable hereunder or pursuant to the Affordable Housing Resale
Restrictions, the City Equity Share shall be immediately due and payable hereunder. Failure to
declare such amounts due in any instance shall not constitute a waiver on the part of the City to
declare them due in the future. Maker will pay to City all suins owing under this Note without
deduction, offset, or counterclaim of any kind.
5. DEFAULT RATE OF INTEREST. If City Equity Share payable to City pursuant to the
Affordable Housing Resale Restrictions and this Note are not paid to City within ten (10) days of
the due date thereof, then interest shall accrue on such sum at a rate equal to the lesser of eight
percent (8%) interest per annum, compounded annually, or the maximum rate permitted by law.
G. PREPAYMENT. This Note may not be prepaid in whole or in part.
7. TRANSFER. Maker shall not transfer, lease, sell, assign,refinance, encumber, convey or
otherwise Transfer any interest in the Property without complying with all requirements of the
Affordable Housing Resale Restrictions, Maker's failure to comply with the requirements of this
paragraph shall be a Default wider this Note.
8. DEFAULT, The occurrence of any one or more of the following shall constitute an event
of default ("Default") hereunder.
8.1 The occurrence of a breach of any of Maker's covenants, warranties, or
representations under this Note, the City Deed of Trust, or the Affordable Housing Resale
Restrictions, including without limitation, any unauthorized refinancing, sale, conveyance, lease,
assignment, encumbrance, or other Transfer of the Property, Maker's failure to occupy the
Property as Maker's principal residence, any failure to pay amounts payable pursuant to this
Note, and Maker's failure to maintain insurance on the Property as required pursuant to the City
Deed of Trust.
8.2 The entry of an order for relief under federal bankruptcy laws as to Maker or the
adjudication of Maker as insolvent or bankrupt pursuant to the provisions of any state or federal
Exhibit C Page 45
55394,00101\43721567.i
insolvency or bankruptcy act, or Maker's consent to, acquiescence in, or attempt to secure the
appointment of, any receiver for all or any substantial part of the Property.
8.3 The occurrence of an event of default under any loan secured by the Property and
the continuance of such default beyond the expiration of all applicable cure periods such that the
holder of such loan has the right to accelerate such loan.
9. Remedies. Upon the occurrence of a Default,the giving of any required notice thereof,
and the expiration of any applicable cure period, City may, at its option, exercise any one or
more of the following remedies:
9.1 Declare all of the sums payable under this Note to be immediately due and
payable without further demand.
9.2 Pursue the exercise of the power of sale provided under the City Deed of Trust.
9.3 Either in person or by agent, with or without bringing any action or proceeding, or
by a receiver appointed by a court, and without regard to the adequacy of its security, enter upon
the Property and take possession thereof(or any part thereof} and of any of the Security in its
own name or in the name of the Trustee, and do any acts which it deems necessary or desirable
to preserve the value or marketability of the Property, or part thereof or interest therein, or
protect the security thereof. The entering upon and taking possession of the Security shall not
cane or waive any breach hereunder or invalidate any act done in response to such breach, and
notwithstanding the continuance in possession of the Property, the City shall be entitled to
exercise every remedy provided by the City Documents or by law, upon the occurrence of any
-Lmcured breach.
9.4 Commence an action to foreclose the City Deed of Trust as a mortgage, appoint a
receiver, or specifically enforce any of the covenants set forth in the City Documents.
9.5 Exercise its option to purchase the Property pursuant to the Affordable Housing
Resale Restrictions.
9.6 Exercise all other rights and remedies provided herein or in any other City
Document.
9.7 Exercise any other remedy provided by law or in equity.
The rights and remedies of the City hereunder are cumulative, and the City's exercise or failure to
exercise one or more of such rights or remedies shall not preclude City's exercise, at the same time
or different times, of any other right or remedy for the same Default or any other Default,
Page 46
Exhibit C
5 53 94.0010 1\43 721567.1
10. Maker's Personal Liabilft . Maker will be fully and personally liable for all loss, cost,
liability, damage, and expense (including without limitation attorneys' fees) suffered or incurred
by City arising from any of the following:
10.1 Failure to pay taxes, assessments, and any other charges that could result in liens
against any portion of the Property or any other Security.
10.2 Failure to pay and discharge any mechanics' liens, materialmen's liens, or other
unpermitted liens against any portion of the Property or any other Security.
10.3 Maker's fraud or intentional misrepresentation with respect to any
representations, warranties, or certifications made in the City Documents or in connection with
Maker's application to participate in the City's affordable housing program.
10.4 Maker's retention of any rental income or other income arising with respect to
any portion of the Property or any other Security subsequent to the date of City's delivery of any
notice of a Default, or which, under the terms of the City Documents, should otherwise have
been paid to City.
10.5 Maker's retention or use of insurance proceeds, condemnation awards, or other
similar funds or payments attributable to the Property or any other Security that pursuant to the
City Documents should have been paid to City or used for another purpose.
10.6 Waste of the Property, or any other failure to maintain, repair, or restore any
portion of the Property or any other Security in accordance with the requirements of the City
Documents.
10.7 The removal, demolition, damage or destruction of any portion of the Property or
any other Security that is neither consented to in writing by City nor fully compensated for by
insurance proceeds or condemnation awards.
10.8 The failure of the City Documents to constitute a lien or security interest, as
applicable, on the Property or any other Security, subject only to those exceptions, if any,
permitted by the City Documents or otherwise approved in writing by City.
10.9 Nothing in this paragraph will affect or limit the rights of City to enforce any of
City's rights or remedies with respect to any portion of the Property or any other Security.
11. Maker's Waivers. Maker hereby expressly waives diligence, presentment,protest, and
demand, and notice of protest, notice of dishonor and notice of nonpayment of this Note, and
expressly waives any rights to be released by reason of any extension of time or change in terms
of payment, or change, alteration or release of any security given for the payments hereof, and
Page 47
Exhibit C
55394.00101\43721567.1
expressly waives the right to plead any and all statutes of limitation as a defense to any demand
on this Note.
12. Notices. All notices, requests, demands, reports or other communications regarding this
Note shall be in writing and delivered: (i) personally; or(ii)by independent, reputable, overnight
commercial courier; or(iii)by deposit in the United States mail, postage and fees fully prepaid,
registered or certified snail, with return receipt requested; addressed as follows, or to such other
address as specified in written notice delivered to the parties pursuant to this Section:
To Maker: At the Property address.
To City: City of Santa Ana
20 Civic Center Plaza(M-30)
P.O. Box 1988
Santa Ana, CA 92702
Attn: City Clerk
13. Any notice that is personally delivered (including by means of professional messenger
service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal
Service), shall be deemed received on the documented date of delivery thereof.
14. Assignment by Lender, Successors and Assigns. This Note shall be binding upon Maker
and Maker's heirs, successors and assigns; provided however, Maker may not assign this Note
without City's prior written consent except as may be permitted in accordance with the City
Deed of Trust and the Affordable Housing Resale Restrictions. City may assign its rights to
receive the proceeds under this Note to any person or entity without the consent of Maker, and
upon notice to Maker of such assignment, all payments shall be made to the assignee.
15. No Joint Venture, The relationship of Maker and City under this Note is solely that of a
participant and administrator of an affordable housing program, and in no manner are the City
and the Maker partners or joint ventures, nor do any of the City Documents establish a principal
and agent relationship between City and Maker.
16. Attorneys' Fees and Costs. If any legal action is filed to interpret or enforce this Note, the
prevailing party shall be entitled to an award of its reasonable attorneys' fees, costs and expenses
incurred therein. Maker agrees to pay all costs and expenses (including reasonable attorneys'
fees) that City may incur in connection with enforcement of this Note and collection of sums
payable hereunder whether or not suit is filed.
17. No Third-Party Beneficiaries. This Note shall not benefit or be enforceable by any
person or entity except the City and the Maker and their respective successors and assigns.
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Exhibit C
55394.00101\43721567.I
18. Entire Agreement, Amendments, This Note, together with the Affordable Housing Resale
Restrictions and the City Deed of Trust, sets forth the entire understanding between Maker and
the City with respect to the subject matter hereof. Any previous representations, warranties,
agreements, and understandings among the parties regarding the subject matter of the Affordable
Housing Resale Restrictions, this Note and City Deed of Trust whether written or oral, are
superseded by the terms of the Affordable Housing Resale Restrictions, this Note and the City
Deed of Trust. This Note may be modified or amended only by a written instrument duly
executed by City and Maker.
19. No City Waiver. Any waiver of any ten-n or provision of this Note must be in writing.
No waiver of any breach, default or failure of condition under this Note or any other City
Document shall be implied from City's failure or delay in declaring a default or exercising any of
City's rights or remedies with respect to such breach, default or failure, or from any previous
waiver of any similar or unrelated breach, default or failure, nor shall acceptance by City of any
payment hereunder constitute a waiver of City's right to require prompt payment of any
remaining amounts owed. Without limiting the generality of the foregoing, City's failure or
delay in declaring any amount due hereunder shall not constitute a waiver of City's right to
declare such sun due for the same or any subsequent event that triggers Maker's payment
obligations hereunder.
20. Severability. If any provision of this Note shall be held by a court of competent
jurisdiction to be invalid, illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions of this Note shall not be affected or impaired thereby.
21. Controlling.Law and Venue. The terms of this Note shall be interpreted under the laws of
the State of California without regard to principles of conflicts of law. This Note was entered
into and is to be performed in the County of Orange, which is the exclusive venue for any action
or dispute arising hereunder.
22. Captions. All captions and headings in this Note are for the purposes of reference and
convenience and shall be disregarded for all other purposes,including the construction or
enforcement of any of the provisions of this Note.
23. Joint and Several. The obligations of each signatory to this Note shall be joint and
several.
24. Time of the Essence. Time is of the essence with regard to all matters contained in this
Note.
MAKER and HOMEBUYER:
By:
Page 49
Exhibit C
55394,00101\43721567.1
EXHIBIT D
FORM OF CITY DEED OF TRUST
CITY DEED OF TRUST
RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:
City of Santa Ana
20 Civic Center Plaza(M-30)
P,O. Box 1988
Santa Ana, California 92702
Attention: City Clerk
Free Recording pursuant to
Government Code 6103&27383
CITY DEED OF TRUST,ASSIGNMENT OF RENTS AND SECURITY
AGREEMENT
THIS PERFORMANCE DEED OF TRUST, ASSIGNMENT OF RENTS AND
SECURITY AGREEMENT ("Deed of Trust") is made as of , 20—, by
and (collectively, "Trustor") as Trustor, to the City of
Santa Ana, as Trustee and Beneficiary (hereafter, "Trustee", "Beneficiary," or"City").
The Trustor, in consideration of the promises herein recited and the trust herein created,
irrevocably and unconditionally grants, transfers, conveys and assigns to Trustee, in trust for the
benefit of City, with power of sale and right of entry and possession, all of Trustor's right,title and
interest now held or hereafter acquired in and to the property Iocated in the City of Santa Ana,
Orange County, ,State of California, described in the attached Exhibit I and more commonly
known as: (APN:, . _) (the "Property");
TOGETHER with the rents, issues, and profits of such Property, subject however, to the
right,power, and authority granted and conferred on City in this Deed of Trust to collect and apply
the rents, issues, and profits; and TOGETHER with all the improvements now or hereafter erected
on the Property, and all easements, rights of way, and appurtenances thereto, and all fixtures now
or hereafter attached to the Property, all of which, including replacements and additions thereto,
shall be deemed to be and remain a part of the Property covered by this Deed of Trust;
All of the foregoing, together with the Property, is herein collectively referred to as the
"Security."
TO HAVE AND TO HOLD the Security, together with acquittances, to the Trustee, its
successors and assigns forever;
Page 50
Exhibit D
5 53 94.00101\43 721567.1
TO SECURE to the City the payment of the sums, and the performance of the covenants
and agreements of the Trustor evidenced by (i) that certain Affordable Housing Resale
Restrictions, Equity Sharing and Regulatory Agreement executed by and between Trustor and
City,dated as of the date hereof and recorded substantially concurrently herewith(the"Affordable
Housing Resale Restrictions"), and (ii) that certain City Promissory Note (the "Note") dated as
of the date hereof and executed by Trustor for the benefit of City, pursuant to which Trustor is
obligated to pay to City a City Equity Share, and all extensions, modifications, or renewals of the
Note and the Affordable Housing Resale Restrictions. The Note and the Affordable Housing
Resale Restrictions are incorporated herein by this reference; and TO SECURE the payment of all
other sums, with interest thereon, advanced in accordance herewith to protect the security of this
Deed of Trust and the performance of the covenants and agreements of Trustor herein contained.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, it is agreed as follows:
1. Trustor's Estate. Trustor represents and warrants that Trustor is lawfully seized
of the estate hereby conveyed, has the right to grant and convey the Security, and that other than
this Deed of Trust, the Security is encumbered only by: (1)that certain deed of trust executed by
Trustor and recorded against the Property substantially concurrently herewith to secure
repayment of a loan made by (the "First Mortgage Lender") to assist
Trustor in the purchase of the Property and evidenced by a promissory note executed by Trustor
in favor of the First Mortgage Lender in the original principal amount of`,[Dollars] ($ )(the
"First Mortgage Note"), and (2) the Affordable Housing Resale Restrictions. Trustor agrees to
warrant and defend generally the title to the Security against all claims and demands, subject to
any declarations, easements or restrictions listed in a schedule of exceptions to coverage in any
title insurance policy insuring the City's interest in the Security, and Trustor shall pay all costs
and expenses, including cost of evidence of title and attorneys' fees in a reasonable sum, in any
such action or proceeding in which City or Trustee may appear, and in any suit brought by City
to foreclose this Deed of Trust. As used in this Deed of Trust, the term"First Mortgage Lender"
shall include all successors and assigns of the First Mortgage Lender with respect to the First
Mortgage Note.
2. Note and Affordable Housing Resale Restrictions. Trustor will promptly pay
when due all sums payable pursuant to the Note and shall perform all of Trustor's covenants and
obligations under the Note, the Affordable Housing Resale Restrictions, and this Deed of Trust.
3. Charges and Liens. Trustor will promptly pay when due, the interest, principal,
and all other charges accruing under any deed of trust,mortgage, or other instrument encumbering
the Property, and will pay when due directly to the payee thereof all taxes, assessments and other
charges, Fines and impositions affecting the Property. Upon request by the City, Trustor will
promptly furnish to the City copies of all notices of amounts due described in this Section and
evidence of payment of such arnounts. Trustor shall pay when due each obligation secured by or
reducible to a lien, charge or encumbrance which now does or later may encumber or appear to
encumber all or part of the Property or any interest therein, whether or not such lien, charge or
encumbrance is or would be senior or subordinate to this Deed of Trust;provided however,Trustor
will not be required to discharge the lien of the deed of trust securing the First Mortgage Note(the
"First Mortgage Deed of Trust"), and Trustor will not be required to pay any tax, charge, lien or
Page 51
Exhibit D
5 5394.00101\43721567.1
assessment described in this Section so long as Trustor is actively contesting its validity in good
faith and by appropriate legal proceedings that will operate to prevent the enforcement of the lien
or forfeiture of the Property or any part thereof. Trustor shall post security for the payment of such
contested claims as may be requested by the City.
4. Protection of Security. If Trustor fails to perform any of the covenants and
agreements set forth in this Deed of Trust, or if any action or proceeding is commenced that
materially affects City's interest in the Property, including, but not limited to, default under any
senior lienholder document, eminent domain, insolvency, code enforcement, arrangements or
proceedings involving a bankrupt or decedent, foreclosure of any mortgage secured by the
Property or sale of the Property under a power of sale of any instrument secured by the Property,
City, at its option, without releasing Trustor from any obligation hereunder, may upon notice to
Trustor,make such appearance, disburse such sums and take such action as is necessary to protect
City's interest,including,but not limited to,the purchase of insurance,disbursement of reasonable
attorneys' fees and entry upon the Property to make repairs. Any amounts disbursed by City
pursuant to this Section, with interest thereon, shall become additional indebtedness of Trustor
secured by this Deed of Trust. Unless Trustor and City agree to other terms of payment, such
amounts shall be payable upon notice from City to Trustor requesting payment thereof, and shall
bear interest from the date of disbursement at the highest rate permissible under applicable law.
Nothing contained in this Section shall require City to incur any expense or take any action
hereunder.
5. Inspection. The City may make, or cause to be made, reasonable entries upon the
Property and inspections of the Security;provided that the City will give Trustor reasonable notice
of inspection.
6. Title Insurance. At Trustor's expense, Trustor shall purchase a CLTA lender's
policy of title insurance for the benefit of City, insuring this Deed of Trust as a secondary lien on
the Property, with no delinquent taxes or assessment liens appearing as exceptions to title,
7. Hazard Insurance. Trustor shall keep the Property insured by a standard all-risk
property insurance policy with endorsements for vandalism, malicious mischief, and special
extended perils, in the full replacement value of the improvements, and with endorsements for
increases in costs due to changes in code and inflation, with loss payable to City and any superior
trust deed holder, as their interests may appear, and any other insurance required by the City.
The insurance carrier providing such insurance shall be licensed to do business in the State
of California and may be chosen by Trustor, subject to approval by City. All insurance policies
and renewals thereof shall be in a form acceptable to the City, and shall include a standard
mortgagee clause with standard lender's endorsement in favor of the holder of any senior lien and
the City as their interests may appear and in a form acceptable to the City. Trustor shall provide
City with copies of all policies and renewals thereof, certificates of insurance, all renewal notices
and all receipts of paid premiums. In the event of loss, Trustor shall give prompt notice to the
insurance carrier and the City or its designated agent. The City, or its designated agent, may make
proof of loss if not made promptly by Trustor. The policies shall include an endorsement providing
that City shall receive thirty (30) days' advance written notice of the cancellation, expiration or
Page 52
Exhibit D
5 53 94.00101\43 721567.1
termination or any material change in the coverage afforded by any of the insurance policies
required under this Section.
If the Property is acquired by the City, all right, title and interest of Trustor in and to any
insurance policy and in and to the proceeds thereof resulting from damage to the Property prior to
the sale or acquisition will pass to the City to the extent of the sums secured by this Deed of Trust
immediately prior to such sale or acquisition, subject to the rights of the holder of any senior lien.
Renewal policies and any replacement policies, together with premium receipts
satisfactory to the City, shall be delivered to the City at least thirty(30)days prior to the expiration
of existing policies.Neither Trustee nor the City shall by reason of accepting,rejecting, approving
or obtaining insurance incur any liability for the existence, nonexistence, form or legal sufficiency
of such insurance, or solvency of any insurer for payment of losses. The application of proceeds
pursuant to this Section shall not cure or waive any default or notice of default hereunder or
invalidate any act done pursuant to such notice.
8. Awards and Damages. Subject to the rights of senior lienholders, all judgments,
awards of damages, settlements and compensation made in connection with or in lieu of(a) taking
of all or any part of or any interest in the Property by or under assertion of the power of eminent
domain, (b) any damage to or destruction of the Property or any part thereof by insured casualty,
and (c) any other injury or damage to all or any part of the Property, are hereby assigned to and
shall be applied to the restoration or repair of the Property (if applicable) or paid to the City. The
City is authorized and empowered (but not required) to collect and receive any such sums and is
authorized to apply them in whole or in part upon any indebtedness or obligation secured hereby,
in such order and manner as the City shall determine at its option. The City shall be entitled to
settle and adjust all claims under insurance policies provided under this Deed of Trust and may
deduct and retain from the proceeds of such insurance the amount of all expenses incurred by it in
connection with any such settlement or adjustment.All or any part of the amounts so collected and
recovered by the City may be released to Trustor upon such conditions as the City may impose for
its disposition. Application of all or any part of the amounts collected and received by the City or
the release thereof shall not cure or waive any default under this Deed of Trust. If the Property is
abandoned by Trustor, or if, after notice by City or its designated agent to Trustor that the
condemnor or insurer offers to make an award or settle a claim for damages, Trustor fails to
respond to City within thirty (30) days after the date such notice is mailed, City or its designated
agent is authorized to collect and apply the proceeds,at City's option,either to restoration or repair
of the Property or to the sums secured by this Deed of Trust
9. Maintenance. Trustor shall maintain the Property and all structures and
landscaping thereon in good condition and repair. Trustor agrees to complete installation of
landscaping as approved by the City, and to diligently maintain and care for installed landscaping,
using generally accepted methods of cultivation and watering. Trustor shall not remove or
demolish any building located on the Property, and agrees to complete or restore promptly and in
good and workmanlike manner any building which may be constructed, damaged or destroyed
thereon, and to pay when due all claims for labor performed and materials furnished therefor, and
to comply with all laws affecting the Property or requiring any alterations or improvements to be
made thereon. Trustor shall not commit or permit waste thereof, and shall not commit or permit
any act upon the Property in violation of applicable laws. Trustor will comply with all applicable
Page 53
Exhibit D
55394.00101\43721567.1
laws, ordinances and governmental regulations affecting the Property or requiring any alteration
or improvement thereof, and will not suffer or permit any violations of any such law,ordinance or
governmental regulation, nor of any covenant, condition or restriction affecting the Property. If
there arises a condition in contravention of this Section, and if the Trustor has not cured such
condition within thirty (30) days after receiving a notice from City of such a condition, then in
addition to any other rights available to City, City shall have the right (but not the obligation) to
perform all acts necessary to cure such condition, and to establish or enforce a lien or other
encumbrance against the Property to recover its cost of cure.
10. Occupancy. Trustor shall occupy the Property as Trustor's primary residence, and
the Property shall be used as the primary residence of Truster and Trustor's household and for no
other purpose. The Property shall not be leased or rented by Trustor to any person or entity other
than as expressly permitted by the Affordable Housing Resale Restrictions or consented to by City
in writing. The City shall have the right to monitor whether the Property is owner-occupied by
requesting that Trustor provide City with a written certification under penalty of perjury that the
Property is owner-occupied, accompanied by supporting documentation reasonably satisfactory to
the City.
11. Transfer. Trustor shall not allow any Further Encumbrance or Transfer of the
Property (as such terms are defined in the Affordable Housing Resale Restrictions) any without
complying with all requirements of the Affordable Housing Resale Restrictions.
12. Assignment of Rents. Trustor hereby irrevocably, absolutely, presently and
unconditionally assigns to City the rents, issues, revenue and profits of the Property. This is an
absolute assignment and not an assignment for security only. Subject to the limitations on lease or
rental of the Property as set forth herein and in the Affordable Housing Resale Restrictions, City
hereby confers upon Tr astor a license to collect and retain such rents, issues, revenue and profits,
as they become due and payable prior to any Default hereunder. Upon the occurrence of any such
Default, City may terminate such license without notice to or demand upon Trustor and without
regard to the adequacy of any security for the indebtedness hereby secured, and may either in
person,by agent, or by a receiver to be appointed by a court, enter upon and take possession of the
Property or any part thereof, and sue for or otherwise collect such rents, issues, and profits,
including those past due and unpaid, and apply the same, less costs and expenses of operation and
collection, including reasonable attorneys' fees, to any indebtedness secured hereby, and in such
order as City may determine. City's right to the rents, issues, revenue and profits of the Property
does not depend upon whether or not City takes possession of the Property. The entering upon and
taking possession of the Property, the collection of such rents, issues, revenue and profits, and the
application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder
or invalidate any act done pursuant to such notice. If a Default occurs while City is in possession of
all or part of the Property and/or is collecting and applying rents as permitted under this Deed of
Trust, City, Trustee and any receiver shall nevertheless be entitled to exercise and invoke every
right and remedy afforded any of them under this Deed of Trust and at law or in equity, including
the right to exercise the power of sale granted hereunder. Regardless of whether or not City, in
person or by agent, takes actual possession of the Property, City shall not be deemed to be a
"mortgagee in possession," shall not be responsible for performing any obligation of the lessor
under any lease,shall not be liable in any manner for the Property,or the use,occupancy,enjoyment
Page 54
Exhibit D
55394.00 10 1\43 721567.1
or operation of any part of it , and unless due solely to the willful misconduct or gross negligence
of City, shall not be responsible for any dangerous or defective condition of the Property or any
negligence in the management,repair or control of the Property.
13. Default.An event of default("Default")shall arise hereunder upon the occurrence
of any one or more of the following and the expiration of any applicable cure period:
a. Trustor fails to occupy the Property as Trustor's principal residence;
b. The sale, conveyance, encumbrance, refinance, assignment, or other
transfer of the Property including without limitation,the lease or rental of the Property in violation
of the Affordable Housing Resale Restrictions;
C. An event of default arises under the Note or the Affordable Housing Resale
Restrictions, and such default remains uncured following the expiration of any applicable cure
period;
d. Trustor fails to pay when due any sum payable pursuant to the Note, the
Affordable Housing Resale Restrictions or this Deed of Trust;
e. The Property is refinanced or encumbered in violation of the Affordable
Housing Resale Restrictions or this Deed of Trust;
f. Trustor fails to maintain insurance on the Property as required by the
Affordable Housing Resale Restrictions and this Deed of Trust,
g. Subject to Trustor's right to contest the following charges, Trustor fails to
pay prior to delinquency taxes or assessments due on the Property or fails to pay when due any
other charge that may result in a lien on the Property, and Trustor fails to cure such default within
twenty (20) days of date of delinquency, but in all events prior to the tune that the holder of such
lien has the right to pursue foreclosure thereon;
h. Trustor declares bankruptcy or mares an assignment of assets for the benefit
of creditors, or an order for relief is entered under federal bankruptcy laws as to Trustor, or Trustor
is adjudicated as insolvent or bankrupt pursuant to the provisions of any state or federal insolvency
or bankruptcy, or Trustor consents to, acquiesces in, or attempts to-secure the appointment of, any
receiver for all or any substantial part of the Property;
L The occurrence of an event of default under any loan secured by the
Property and the continuance of such default beyond the expiration of all applicable cure periods
such that the holder of such loan has the right to accelerate such loan.
j. Trustor fails to observe or perform any other covenant, condition, or
agreement to be observed or performed by Trustor pursuant to the Note, the Affordable Housing
Resale Restrictions or this Deed of Trust.
Page 55
Exhibit D
5 5394.00 101\43721567.1
14. Remedies. Upon the occurrence of a Default, the giving of notice thereof and the
expiration of any applicable cure period, City may, at its option, exercise any one or more of the
following remedies:
a. Declare all of the sums payable under the Note to be immediately due and
payable without further demand.
b. Pursue the exercise of the power of sale provided under this Deed of Trust.
C. Either in person or by agent, with or without bringing any action or
proceeding, or by a receiver appointed by a court, enter upon, take possession thereof(or any part
thereof) and of any of the Security, in its own name or in the name of Trustee, and do any acts
which it deems necessary or desirable to preserve the value or marketability of the Property, or
part thereof or interest therein, increase the income therefrom, or protect the security thereof. The
entering upon and taking possession of the Security shall not cure or waive any breach hereunder
or invalidate any act done in response to such breach and, notwithstanding the continuance in
possession of the.Security, the City shall be entitled to exercise every right and remedy provided
under the Note, this Deed of Trust, or the Affordable Housing Resale Restrictions, or by law upon
occurrence of any uncured breach.
d. Commence an action to foreclose this Deed of Trust as a mortgage, appoint
a receiver, or specifically enforce any of the covenants hereof.
e. Exercise any option to purchase the Property, as authorized pursuant to the
Affordable Housing Resale Restrictions.
f Exercise all other rights and remedies provided herein, in the instruments
by which the Trustor acquires title to any Security, or in any other document or agreement now or
hereafter evidencing, creating or securing all or any portion of the obligations secured hereby.
g. Exercise any other remedy provided by law or in equity.
15. Acceleration and Sale.
a. Notice of Default. Upon Trustor's breach of any covenant or agreement of
Trustor under the Note, the Affordable Housing Resale Restrictions or this Deed of Trust, City
shall mail notice to Trustor as provided in Section 24 hereof specifying:(i)the nature of the breach;
(ii) the action required to cure such breach; (iii) a date no less than thirty (30) days from the date
the notice is mailed to Trustor by which such breach must be cured or such shorter cure period as
may be provided in the Note, the Affordable Housing Resale Restrictions or this Deed of Trust;
and (iv) that failure to cure such breach on or before the date specified in the notice may result in
acceleration of the Loan and the sale of the Property. The notice shall further inform Trustor of
Trustor's right to reinstate after acceleration and the right to bring a court action to assert the
nonexistence of a default or any other defense of Trustor to acceleration and sale. If the breach is
not cured on or before the date specified in the notice, City at City's option declare all of the sums
secured by this Deed of Trust to be immediately due and payable without further demand and may
invoke the power of sale and/or pursue any other remedy provided herein or available under law.
Exhibit D Page 56
55394.00101143721567,1
City shall be entitled to collect from the Trustor, or from the proceeds of the sale of the Property,
all reasonable costs and expenses incurred in pursuing the remedies provided hereunder,including,
but not limited to, reasonable attorneys' fees.
If a non-monetary default is not reasonably capable of being cured within thirty
(30) days, the City, in its sole and absolute discretion, may grant the Trustor or the First Mortgage
Lender such additional time as is reasonably necessary to cure the default provided that the Trustor
or the First Mortgage Lender (i) initiates corrective action within said period, and (ii) diligently,
continually, and in good faith works to effect a cure as soon as possible.
Notwithstanding the cure periods established in this Section, in no event shall the
City be precluded from sooner exercising any remedies if its security becomes or is about to
become materially jeopardized by any failure to cure a default or the default is not cured within
ninety (90) days after the first notice of default or delinquency is given.
b. Trustor's Right to Reinstate. Notwithstanding City's acceleration of the
suns secured by this Deed of Trust, Trustor will have the right to have any proceedings begun by
City to enforce this Deed of Trust discontinued at any time prior to five(5) days before sale of the
Property pursuant to the power of sale contained in this Deed of Trust or at any time prior to entry
of the judgment enforcing this Deed of Trust if. (a) Trustor pays City all sums which would be
then due under this Deed of Trust and the Note had no acceleration occurred; (b) Trustor pays all
reasonable expenses incurred by City and Trustee in enforcing the covenants and agreements of
Trustor contained in this Deed of Trust, including,but not limited to, reasonable attorneys' fees;
Trustor cures all breaches of any other covenants or agreements of Trustor set
forth in the Affordable Housing Resale Restrictions and this Deed of Trust; and (d) Trustor takes
such action as City may reasonably require to assure that the lien of this Deed of Trust, City's
interest in the Property and Trustor's obligation to pay the sums and perform the obligations
secured by this Deed of Trust shall continue unimpaired. Upon such payment and cure by Trustor,
this Deed of Trust and the obligations secured hereby will remain in full force and effect as if no
acceleration had occurred.
. C. Sale. After delivery to Trustee of a Notice of Default and Demand for Sale
and after the expiration of such time and the giving of such notice of default and sale as may then
be required by law, and without demand on Trustor,Trustee shall sell the Property at the time and
place of sale fixed by it in said notice of sale, at public auction to the highest bidder for cash in
lawful money of the United States of America,payable at time of sale, Trustee may postpone sale
of all or any portion of the Property by public announcement at such time and place of sale and
from time to time thereafter may postpone such sale by public announcement at the time and place
fixed by the preceding postponement. Any person, including Trustor, Trustee or the City, may
purchase at such sale. Upon such sale by Trustee it shall deliver to such purchaser its deed
conveying the Property so sold, but without any covenant or warranty expressed or implied. The
recitals in such deed of any matters or facts shall be conclusive proof of their truthfulness. Upon
sale by Trustee and after deducting all costs, expenses and fees of Trustee, Trustee shall apply the
proceeds of sale to the payment of the indebtedness hereby secured, including without limitation
the indebtedness evidenced by the Note, any advances made or costs or expenses paid or incurred
by City under this Deed of Trust, any indebtedness evidenced by any other instrument hereby
Page 57
Exhibit D
553 94.00101\43721567.1
secured, and all other sums then secured hereby, including without limitation, interest as provided
in the Note and the Affordable Housing Resale Restrictions, in such order as the City shall direct;
and then the remainder, if any, shall be paid to the person or persons legally entitled thereto.
16. Remedies Cumulative,• No Waiver. No exercise of any right or remedy by the
City or Trustee hereunder shall constitute a waiver of any other right or remedy herein contained
or provided by law, and no delay or forbearance by the City or Trustee in exercising any such right
or remedy hereunder shall operate as a waiver thereof or preclude the exercise thereof in any
continued or subsequent default hereunder. All remedies provided in this Deed of Trust are distinct
and cumulative to any other right or remedy under this Deed of Trust or any other document, or
afforded by law or equity, and may be exercised concurrently, independently or successively. No
sale of the Property, forbearance on the part of City, or extension of the time for payment of the
indebtedness hereby secured shall operate to release, discharge, waive, modify, change or affect
the Iiability of Trustor either in whole or in part.
17. Indemnity. Trustor agrees to defend, indemnify, and hold the Santa Ana, and its
elected and appointed officers, officials, employees,and agents harmless from all losses,damages,
liabilities, claims, actions,judgments, costs, and reasonable attorneys' fees that they may incur as
a direct or indirect consequence of. (i) Trustor's failure to perform any obligations as and when
required by the Note,the Affordable Housing Resale Restrictions, or this Deed of Trust; or(ii)the
failure at any time of any of Trustor's representations or warranties herein or in the Affordable
Housing Resale Restrictions or the Note to be true and correct.
18. Due on Transfer of the Property. If the Truster sells, conveys, assigns, transfers,
alienates, or otherwise disposes of its interest in the Property, either voluntarily or involuntarily or
by operation of law, in part or in full, in violation of the Affordable Housing Resale Restrictions,
the City may, at its option, require immediate payment in full of all sums due under the Note.
19. Reconveyance. Upon payment of all sums and satisfaction of all obligations
secured by this Deed of Trust, including without limitation, payment of the City Equity Share as
defined in the Affordable Housing Resale Restrictions, and upon the expiration or termination of
the Affordable Housing Resale Restrictions, the City will provide a written request to the Trustee
to reconvey the Security and will surrender this Deed of Trust and the Note to Trustee.The Trustee
shall reconvey the Security without warranty and without charge to the person or persons legally
entitled thereto. Such person or persons shall pay all costs of recordation, if any. The recitals in
the reconveyance of any hatters or facts shall be conclusive proof of the truthfulness thereof.
20. Trustee Substitution. The City, at its option and without prior notice, may from
time to time, by written instrument, remove the Trustee and appoint a successor trustee pursuant
to a written instrument executed by City and duly acknowledged and recorded in the Official
Records of Orange. Such instrument shall be conclusive proof of proper substitution of such
successor Trustee or Trustees, who shall, without conveyance from the predecessor Trustee,
succeed to all the title,estate,power and duties conferred upon the Trustee herein and by applicable
law. Such instrument shall set forth the name of the Trustor, the original Trustee and the
Beneficiary hereunder, the book and page where this Deed of Trust is recorded, and the name and
address of the new Trustee.
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Exhibit D
55394.00 10 1\43721567.1
21. City's Rights to Release.Without affecting the liability of any person for payment
of any indebtedness hereby secured (other than any person released pursuant hereto), including
without limitation any one or more endorsers or guarantors, and without affecting the lien hereof
upon any of the Property not released pursuant hereto, at any time and from time to time without
notice: (a)City may in its sole discretion: (i)release any person now or hereafter liable for payment
of any or all such indebtedness, (ii) extend the time for or agree to alter the terms of payment of
any or all of such indebtedness,and(iii)release or accept additional security for such indebtedness,
or subordinate the lien or charge hereof, and (b) Trustee, acting pursuant to the written request of
the City, may reconvey all or any part of the Property, consent to the malting of any snap or plot
of the Land, join in granting any easement thereon, or join in any extension agreement of any
agreement subordinating the lien or charge hereof.
22. Subordination. Absent the prior written consent of City, this Deed of Trust shall
not be subordinated to any other deed of trust or encumbrance on the Property, except a First Lien,
as allowed by the Affordable Housing Resale Restrictions.
23. Reauest for Notice. City requests that copies of any notice of default and notice of
sale affecting the Property be sent to City at its address set forth herein. City shall record a Request
for Notice of Default and Sale.
24. Notices.All notices,requests,demands,reports or other communications regarding
this Deed of Trust shall be in writing and delivered: (i) personally; or (ii) by independent,
reputable, overnight commercial courier; or(iii)by deposit in the United States mail, postage and
fees fully prepaid, registered or certified mail, with return receipt requested, and addressed as
follows, or to such other address as specified in written notice delivered to the parties pursuant to
this Section:
To Trustor: At the Property address.
To City: City of Santa Ana
20 Civic Center Plaza(M-30)
Santa Ana, CA 92702
Attn: City Clerk
Any notice that is personally delivered (including by means of professional messenger
service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal
Service), shall be deemed received on the documented date of delivery thereof.
25. Successors Sound. The terms of this Deed of Trust shall be binding upon the
Trustor and the Trustor's heirs, legatees, devisees, administrators, executors, successors and
assigns.
26. Attornevs' Fees and Costs. If any legal action is filed to enforce or interpret this
Deed of Trust, or the interpretation or enforcement thereof, the prevailing party shall be entitled to
an award of its reasonable attorneys' fees, costs and expenses incurred therein.
Page 59
Exhibit D
55394.00101\43721567.1
27. No Waiver.Any waiver of any term or provision of this Deed of Trust must be in
writing. No waiver shall be implied from any delay or failure by City to take action on any breach
or default hereunder or to pursue any remedy allowed under this Deed of Trust or applicable law.
No failure or delay by City at any time to require strict performance of any provision of this Deed
of Trust or to exercise any election contained herein or any right,power or remedy hereunder shall
be construed as a waiver of any other provision or any succeeding breach of the same or any other
provision hereof or a relinquishment for the future of such election.
28. No Third-Party Beneficiaries. This Deed of Trust shall not benefit or be
enforceable by any person or entity except the City, the Trustee, and the Trustor and their
respective successors and assigns.
29. Entire Aureement. This Deed of Trust, together with the Affordable Housing
Resale Restrictions and the Note, sets forth the entire understanding between Trustor and the City
with respect to the subject matter hereof. Any previous representations, warranties, agreements,
and understandings among the parties regarding the subject matter of the Affordable Housing
Resale Restrictions, this Deed of Trust and Note whether written or oral, are superseded by the
terms of the Affordable Housing Resale Restrictions, the Note and this Deed of Trust.
30. Amendments. This Deed of Trust shall not be amended except by a written
instrument duly executed by Trustor and Beneficiary and recorded in the Official Records of
Orange.
31. Severability. If any provision pf this Deed of Trust shall be held by a court of
competent jurisdiction to be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions of this Deed of Trust shall not be affected or impaired
thereby.
32. Controlliniz Law and Venue.The terms of this Deed of Trust shall be interpreted
under the laws of the State of California without regard to principles of conflicts of law.This Deed
of Trust was entered into and is to be performed in the County of Orange, which is the exclusive
venue for any action or dispute arising out of this Deed of Trust.
33. Captions and Gender.All captions and headings in this Deed of Trust are for the
purposes of reference and convenience and shall be disregarded for all other purposes, including
the construction or enforcement of any of provisions thereof. Whenever the context so requires,
the masculine gender includes the feminine and/or neuter, and the singular number includes the
plural.
34. Joint and Several.The obligations of each signatory to this Deed of Trust shall be
joint and several.
35. Time of the Essence.Time is of the essence with regard to all matters contained in
this Deed of Trust.
Page 60
Exhibit D
55394.00101\43721567.1
[SIGNATURES ON FOLLOWING PAGE]
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date first
written above.
TRUSTOR:
By:
Print Name:
By:
Print Name:
(Signatures must be acknowledged by notary)
Exhibit D Page 61
553 94.00101\43721567.1
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
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) ss.
On , 20�, before me, a 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 capacitylies, and that by his/her/their
signature/s on the instrument the person/s, or the entity upon behalf of which the persons acted,
executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing is true and correct.
WITNESS my hand and official seal Signature of Notary Public
Page 62
Exhibit D
5 53 94.00 10 1\43 721567.1
EXHIBIT I OF DEED OF TRUST
LEGAL DESCRIPTION
Page 63
Exhibit 1
5 5394,0010111437215G7.I of Deed of Trust(Legal Description)
EXHIBIT E
INCOME VERIFICATION FORM
Affordable Unit Address:
Head of Household (Print Name):
Current Address (if
different from above):
Telephone Number: Home: Work: Cell:
Email address:
Date of Birth: Social Security#or TIN:
Household Composition
List All Household Members Living in the Affordable Unit
Dependent Social Security#
Name Sex Age (Y/N) or Taxpayer ID#
List additional household members on a separate sheet of paper.
Exhibit E Page 64
55 394.00101\43 721567.1
INCOME VERIFICATION FORM
Monthly Gross Income *
List All Sources of Income of All Household Members Living in the Affordable Unit
Part 1: Earned Income
Other
Head of Household
Household Members Total
1. Gross wages, before payroll deductions and $ $ $
including overtime pay, commissions, fees, tips
and bonuses.
2. Net income from self employment, independent $ $ $
contractor work or a business.
3. Social security and any payments from annuities, $ $ $
insurance policies, pensionlretirement funds,
disability or death benefits received periodically.
4. Payment in lieu of earnings, such as $ $ $
unemployment, disability compensation, worker's
compensation and severance pay.
5. Public assistance, welfare payments $ $ $
6. Alimony, child support, other periodical Iowa nces $ $ $
7. Regular pay, special pay and allowances of $ $ $
members of the Armed Forces
8. Other $ $ $
Subtotal: Monthly Earned Income $
Total Monthly Earned Income x 12 = $ Total Annual Household Gross Earned Income
INCOME VERIFICATION FORM
Monthly Gross Income '"
Exhibit E Page 65
55394.00101\43721567.1
List All Sources of Income of All Household Members Living in the Affordable Unit
Part 2: Investment Income
Total
Other Adult Household
Head of Household Investment
Household Members Income
1. Interest paid on Bank and Savings accounts $ $ $
2. Dividends and other payments from stocks and $ $ $
bonds
3. Income from real property (i.e. rental property) $ $ $
4. Other(describe) $ $ $
Subtotal: Monthly Investment Income: $
Total Monthly Investment Income x 12 = $ Total Annual Household Investment Income
*Note: The following items are not considered income: casual or sporadic gifts; amounts specifically for or in
reimbursement of medical expenses; lump sum payments such as inheritances, insurance payments, capital
gains and settlement for personal or property losses; educational scholarships paid directly to the student or
educational institution; special pay to a serviceman head of family away from home and under hostile fire;
relocation payments under federal, state or local law; foster child care payments; value of coupon allotments
for purpose of food under Food Stamp Act of 1964 which is in excess of amount actually charged the eligible
household; payments received pursuant to participation in the following programs: VISTA, Service Learning
Programs, and Special Volunteer Programs, SCORE, ACE, Retired Senior Volunteer Program, Foster
Grandparent Program, Older American Community Services Program, and National Volunteer Program to
Assist Small Business Experience.
Exhibit E Page 66
55394.00 10 1\43 721567.1
INCOME VERIFICATION FORM
Assets **
List the Current Value of All Assets of All Household Members Living in the Affordable Unit
If the Asset generates income, that income must be specified In Part 2 above
Other Adult
Head of Household
Household Members Total Value of
Value Value Assets
1. Bank and Savings accounts $ $ $
2. Stocks and bonds $ $ $
3. Real property (i.e. rental property) $ $ $
4. Other(describe) $ $ $
Total Asset Value $
**Note: Necessary items, such as furniture and automobiles, used for personal use are excluded from
household assets. Collections of items for hobby, investment or business purposes must be included in
household assets. If the total value of household assets exceeds $5,000, the calculation of the household's
annual income shall include the greater of the actual amount of income, if any, derived from all of the
household assets; or 10% of the total value of the assets.
Exhibit E Page 67
553 94.00101\43 721567.1
INCOME VERIFICATION FORM
if the total asset value exceeds $5,000, perform the calculations in the following table. If the total asset value
is less than $5,000, the amount of investment income to be included in annual household income is $0.
Calculation of Investment Income to be Included in Annual Household Income
1. Total Annual Household Investment Income $
2. Total Asset Value $ x % $
The Greater of#1 or#2 = Investment Income to be Included in Annual Household Income $
Calculation of the Household's Total Annual Income
Total Annual Household Gross Earned Income $
Total Investment Income to be Included in Annual Household Income $
Total Household Income $
Documentation
Attach True Copies of the Relevant Documents Listed Below
Paycheck stubs from three most recent
pay periods Bank/Savings account verification
Employment verification Self-employment verification
Three years Income tax returns for Title
Holders Unemployment verification
Social security verification Welfare verification
Alimony/child support verification Disability income verification
Other(Describe)
Page 68
Exhibit E
55394.00101\43721567.1
AFFIDAVIT
This Affidavit is made with the knowledge that it will be relied upon by and the
City of Santa Ana to determine maximum income for eligibility to purchase the Affordable Unit
listed above. (1/we)warrant that all information set forth in this document is true, correct and
complete and based upon information (I/we) deem reliable and based upon such investigation
as (I/we) deemed necessary.
(I/We)acknowledge that (1/we) have been advised that the making of any misrepresentation or
misstatement in this affidavit will constitute a material breach of(my/our) purchase agreement
and will additionally enable the seller to terminate the purchase contract and sell the Affordable
Unit to another party.
(I/We) do hereby swear under penalty of perjury that the foregoing statements are true and
correct and that this affidavit has been executed as of the date specified below by each adult
member of the household which intends to occupy an Affordable Unit located at
,Santa Ana, California.
Signature Date
Printed Name
Executed at , Santa Ana, California
Signature Date
Printed Name
Executed at , Santa Ana, California
Page 69
Exhibit E
55394.00101\43721567.1
EXHIBIT F
CERTIFICATION OF CONTINUED OCCUPANCY
Date:
Owner(s) Name:
Address: Santa Ana, CA
We are the Owners of an Inclusionary Unit that was produced under the requirements of the City of Santa
Ana Inclusionary Housing Ordinance, We understand and agree that the Inclusionary Unit must be used as
our Primary Residence and for no other purpose.
By this Certification, we declare under penalty of perjury that:
1, We currently occupy the Inclusionary Unit; and
2. We have occupied the Inclusionary Unit for at least ten (10) out of the past twelve (12) months; and
3. We have not used the Inclusionary Unit for any other purpose than as our Primary Residence; and
4, We are not renting or leasing any part of the Inclusionary Unit to another party.
We have attached true and accurate copies of two utility bills or other documentation evidencing our
continued occupancy of the Inclusionary Unit.
We acknowledge that any intentional or negligent misrepresentation in this Certification may result in civil
liability and/or criminal penalties including, but not limited to, fine or imprisonment, or both, and liability for
monetary damages under the provisions of Title 18, United States Code, Section 100.1, et seq.
Signed:
Signed:
Page 70
Exhibit F
5 5394.00101\43721567.1
EXHIBIT G
FORM OF NOTICE OF AFFORDABILITY RESTRICTIONS ON TRANSFER OF
PROPERTY
RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:
City of Santa Ana
20 Civic Center Plaza(M-30)
P.O. Box 1988
Santa Ana, California 92702
Attention: City Clerk
.Free Recording pursuant to
Government Code 6103&27383
NOTICE OF AFFORDABILITY RESTRICTIONS ON
TRANSFER OF PROPERTY
This Notice of Affordability Restrictions on Transfer of Property (or "Notice of
Affordability Restrictions") is executed and recorded pursuant to the Density Bonus Housing
Agreement With Declaration of Covenants, Conditions, and Restrictions (the "Density Bonus
Agreement"), recorded on or about , 202_1 in the Official Records of Orange County,
against that certain real property generally located at (APN: )in the City
of Santa Ana, California ("City") as legally described in Exhibit 1 hereto ("Property"). The City
of Santa Ana, a municipal corporation ("City"), and
(collectively "Homebuyer") have entered into that certain
Affordable Housing Resale Restrictions, Equity Sharing, and Regulatory Agreement, dated
concurrently herewith ("Affordable Housing Resale Restrictions").
1. The Affordable Housing Resale Restrictions provides for affordability restrictions
and restrictions on the transfer of the Property, as more particularly set forth in the Affordable
Housing Resale Restrictions. A copy of the Affordable Housing Resale Restrictions is on file with
City as a public record and is deemed incorporated herein. Reference is made to the Affordable
Housing Resale Restrictions with regard to the complete text of the provisions of such agreement
and all defined terms therein, which provides for affordability restrictions and restrictions on the
transfer of the Property.
2. The Affordable Housing Resale Restrictions contains restrictions on the sale of the
Property and an equity sharing agreement for Homebuyer to pay to the City certain proceeds from
the sale of the Property upon the expiration of the Affordability Term for the Property.
Page 71
Exhibit G
553 94.00101\43721 567.1
2. The Affordable Housing Resale Restrictions contains restrictions on the sale of the
Property and an equity sharing agreement for Homebuyer to pay to the City certain proceeds from
the sale of the Property upon the expiration of the Affordability Term for the Property.
(A) For a period commencing upon the date on which the Property receives a
Certificate of Occupancy, which occurred on `[DATE], and terminating on the date that is
ten (10) years later (the "Affordability Term"), the Property may only be transferred to
another eligible,qualified Moderate Income Household,at an Affordable Sales Price; such
restrictions are set forth at greater length in the Density Bonus Agreement and the
Affordable Housing Resale Restrictions.
(B) Upon expiration of the Affordability Term, the City is entitled to an
amount of the proceeds from any Transfer that is equal to the City Equity Share, which is
secured by the City Deed of Trust. The City Equity Share is based on the following; (i) an
amount equal to the difference between the fair market value of the Affordable Unit at the
time of the initial purchase and the Affordable Sales Price(the"Initial Subsidy"), plus (ii)
an amount equal to the product of(1)the appreciation of the Affordable Unit, as measured
by the increase in the fair market value of the Affordable Unit at the time of the sale to the
Homebuyer and the resale of the Affordable Unit, and (2) the percentage that the initial
subsidy represented of the fair market value of the Affordable Unit when it was purchased
by the Homebuyer (the "Proportionate Share of Appreciation"). The City Deed of Trust
will not be released as an interest in the Property or otherwise reconveyed unless and until
the City is paid the City Equity Share in accordance with the Affordable Housing Resale
Restrictions.
3. Prior to a transfer of the Property, Homebuyer must comply with requirements of
the Affordable Housing Resale Restrictions, including but not limited to the following
requirements of Section 5:
a. Notice to City. Homebuyer shall send the Notice of Intent to Transfer to
City pursuant to Section of the Affordable Housing Resale Restrictions.
b. Qualification of Proposed Transferee, During the Affordability Term,
the proposed Transferee shall provide City with sufficient information in the form provided by
City including without limitation, a certification as to the income and family size of the proposed
Transferee, for City to determine if the proposed Transferee is a Moderate Income Household, and
the proposed Affordable Sales Price.
C. Certificates from Parties. During the Affordability Term,Homebuyer and
proposed Transferee each shall certify in writing, in a form acceptable to City, that the Transfer
shall be closed in accordance with, and only with, the terms of the sales contract and other
documents submitted to and approved by City and that all consideration delivered by the proposed
Transferee to owner has been fully disclosed to City. The written certificate shall also include a
provision that 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 have the right to file an action at law or in equity to make the
Page 72
Exhibit G
5 53 94.0010 1\437215 67,1
parties terminate and/or rescind the sales contract and/or declare the sale void notwithstanding the
fact that the Transfer may have closed and become final as between Homebuyer and Transferee.
d. Written Consent of City Required Before Transfer. During the
Affordability Terris,the purchase sale agreement or other contract for Transfer of the Property, and
the Income Verification Form, shall be provided to the City, which shall have at least thirty (30)
days to review. The Property, and any interest therein, shall not be conveyed by any Transfer
except with the express written consent of City, which consent shall be given only if the Transfer
is in accordance with the provisions of this Agreement The Property, and any interest therein, shall
not be conveyed by any Transfer except with the express written consent of City, which consent
shall be given only if the Transfer is in accordance with the provisions of the Affordable Housing
Resale Restrictions.
e. Notice of Prohibited Transfer. Within thirty(30) days after receiving all
information required by the Affordable Housing Resale Restrictions, the City shall determine and
give notice to Homebuyer as to whether the City consents to the Transfer as a Permitted Transfer,
or if the City determines the proposed Transfer is a Prohibited Transfer. Any attempt to Transfer
the Property without the City's written approval, or after the City has given notice of a Prohibited
Transfer, shall be a Default of this Agreement, and the City may apply to a court of competent
jurisdiction for specific performance of this Agreement, for an injunction prohibiting a proposed
sale or Transfer in violation of this Agreement, for a declaration that the Prohibited Transfer is
void, or for any such other relief as may be appropriate.
f. Delivery of Documents. Upon the close of the proposed Transfer,
Homebuyer and Transferee, as applicable, shall provide the City with a copy of the final sales
contract, settlement statement, escrow instructions, all required certificates, and any other
documents City may request."
8. The Affordable Housing Resale Restrictions and the Density Bonus agreement both
remain in full force and effect and are not amended or altered in any manner whatsoever by this
Notice of Affordability Restrictions.
10. Capitalized terms shall have the meaning established under the Density Bonus
Agreement or the Affordable Housing Resale Restrictions (including all Attachments or Exhibits
thereto) excepting only to the extent as otherwise expressly provided under this Notice of
Affordability Restrictions.
11. Persons having questions regarding this Notice of Affordability Restrictions, the
Affordable Housing Resale Restrictions or the Density Bonus Agreement should contact City to
obtain copies.
HOMEBUYER:
By:
By:
Page 73
Exhibit G
5 5394.00101143721567.1
(Signatures must be acknowledged by notary)
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
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} ss.
Oil 20 before me, _ a 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 capacitylies, and that by his/her/their
signature/s on the instrument the persons, or the entity upon behalf of which the persons acted,
executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing is true and correct.
WITNESS my hand and official seal Signature of Notary Public
Page 74
Exhibit G
5 53 94.00 101\43721567.1
EXHIBIT 1 TO NOTICE OF AFFORDABILITY RESTRICTIONS
LEGAL DESCRIPTION
Exhibit I Page 75
to Notice of Affordability Restrictions (Legal Description)
5 5394.0010 1\43721567.1
Exhibit H
FORM OF REQUEST FOR NOTICE OF DEFAULT
RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:
City of Santa Ana
20 Civic Center Plaza(M-30)
P.O. Box 1988
Santa Ana, California 92702
Attention: City Clerk
Free Recordingpursuant to
Government Code 6103&27383
REQUEST FOR NOTICE UNDER CIVIL CODE SECTION 2924B
In accordance with California Civil Code Section 2924b request is hereby made that a copy
of any Notice of Default and a copy of any Notice of Sale under the Deeds of Trust recorded as
Instrument Nos. , and on in the Official Records of County of Orange,
California, and
describing land therein as:
[See Exhibit 1 attached hereto]
executed by , as TrustorBorrower, in
which the City of Santa Ana is named as Beneficiary and Trustee, be mailed to:
City of Santa Ana,20 Civic Center Plaza(M-30)P.O. Box 1988, Santa Ana,CA 92702,Attention:
City Clerk.
[Signature on next page]
Exhibit H Page 76
55394.00101\43721567.1
ATTEST: CITY OF SANTA ANA
Jennifer Hall Alvaro Nufiez
City Cleric City Manager
APPROVED AS TO FORM:
By: [NAME]
City Attorney
Page 77
Exhibit H
55394.00101\43721567.1
EXHIBIT 1 TO REQUEST FOR DEFAULT
LEGAL DESCRIPTION
Page 78
Exhibit I
AFFORDABLE SALES PRICE
Income criteria used to detennine affordable sales price and affordable housing cost are based on
standards imposed by the Ordinance and California Health and Safety Code Sections 50093 and
50052.5.
Certain assumptions are used in calculating both the Affordable housing cost and the Affordable
Sales Price for the Affordable Units in this Project.
Affordable housing costs include reasonable costs associated with owning a housing unit. These
include:
• Principal and interest payments for the Affordable Unit with a 10% down payment
• Private mortgage insurance (if applicable)
• Property taxes and assessments
• Homeowner's insurance
• A reasonable allowance for utilities
• A reasonable allowance for unit maintenance; and
• Homeowners maintenance association dues (HOA)
The maximum Affordable Sales Price for an Affordable Unit is the total sales prices a typical
Moderate Income Household (up to 120% of median income), adjusted for the household size
appropriate for the unit size, can afford to pay for housing. Accordingly,the Affordable Sales Price
for the Affordable Units in this Project will be as set forth below unless the Household income of
the Moderate Income Household exceeds 110% of Area Median Income adjusted for household
size, in which case the Affordable Sales Price shall be recalculated in accordance with California
Health and Safety Code ("HSC") Section 50052.5 and the actual income of the Homebuyer to
calculate the Affordable Sales Price for that Homebuyer. Affordable Sales Price shall be
recalculated quarterly and upon annual release of AMI for Orange County by HCD, in accordance
with HSC Section 50052.5. Further, the calculation of the Affordable Sales Price will be based on
actual unrestricted rate price estimates, the percentage of income allocated to housing pursuant to
Health and Safety Code , 50052.5, actual homeowner's association dues, utility costs (based on
similar ro'ects) and a cominercially reasonable interest rate at the time the Homebuyer enters into
a Residential Purchase Agreement with Developer, or its successor in interest
leaQeFs q4 the + zle. In the event that the actual interest rate available
for the Supportable Mortgage is less than the interest rate set forth herein, Developer may elect to
recalculate Affordable Sales Price based on actual interest rate.
The sale price below is based on a target income level established by Health and Safety Code
Section 50052.5,not the income of the actual Homebuyer,except in the case of Homebuyers whose
income exceeds 110% of area median income. The household size adjustment that is used in
determining the income limit for the purpose of setting the maximum Affordable Sales Price is
based on the number of bedrooms in the unit, not the size of the specific Homebuyer's household.
Page 79
These criteria are based on the California Health and Safety Code and allow the Affordable Sales
Price to be set in advance of identifying a specific buyer, The Affordable Sales Price for each
Affordable Unit is determined by using three-bedroom unit and presumed household size of four
and by using four-bedroom unit and presumed household size of five.
AFFORDABLE SALES PRICE CALCULATIONS
JANUARY 1-MARCH 31,2025
AHOCO CALCULATIONS:2024 INCOME STANDARDS
ORANGE COUNTY,CALIFORNIA
IL Moderate income:1200h HCD Median Income-30%of Income Allotted to Housing Expenses
1-Bdrm 2-Bdrm 3-Bdrm 4-Bdrm
A. Income
Benchmark Household Size 2 3 4 5
Household Income $123,840 $139,320 S154,800 $167,160
%of Income Allocated to Housing 30% 300"0 3V1. 30%
income Allotted to Housing $37.150 $41,800 $46,440 $50.150
B.OMing Expenses
Utility Allowances ' $2.592 $3.396 $4,296 $5,268
HOAtInsurancelMaintenance 2,100 2,400 2,700 3,000
Property Taxes @ 1.16%of Affordable Price 4,220 4.681 5.128 5,445
Total Expenses $8,912 $10,477 $12,124 $13,713
C. Income Available for Mortgage $28,238 $31.323 $34,316 $36,437
D. Affordable Housing Price
Supportable Mtg C@ 7.23%Interest ' $345,600 $383,300 $420,000 $445,900
Home Buyer Down Pymt @ 5%Affordable Price 18,200 20,200 22j00 23,500
Maximum Purchase Price $363,800 $403,500 $442.100 $469,400
' Based on the Orange County Housing Authority utilities allowances effective as of 10l1/24.Assumes:Electric Cooking;Electric
Heating;Electric Water Heater;Basic Electric;Air Conditioning;Water;Sewer;and Trash.
' Based on a 50 basis points premium applied to the Freddie Mac monthly average,between February 2024 and January 2025 for a
fixed interest rate mortgage loan with a 30-year amortization period..
Page 80