HomeMy WebLinkAboutItem HA 03 - Subordination Agreement and Lease Rider for FX Residences Community Development Agency
www.santa-ana.org/cd
Item # 3
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
June 16, 2026
TOPIC: Subordination Agreement and Lease Rider for FX Residences
AGENDA TITLE
Subordination Agreement and Lease Rider with the State of California Department of
Housing and Community Development for FX Residences
RECOMMENDED ACTION
1. Authorize the Executive Director of the Housing Authority to execute a
Subordination Agreement with the State of California Department of Housing and
Community Development ("HCD") and Shelter Providers of Southern California,
Inc. DBA HomeAid Orange County I Los Angeles ("HomeAid") to subordinate the
Housing Authority's $1,656,947 loan to a $3,006,567 senior permanent loan from
HCD for FX Residences (Agreement No. A-2026-XXX).
2. Authorize the Executive Director of the Housing Authority to execute a Lease
Rider with HCD and HomeAid to induce / allow HCD to make a $3,006,567
senior permanent loan for FX Residences (Agreement No. A-2026-XXX).
GOVERNMENT CODE 484308 APPLIES: Yes
DISCUSSION
On December 7, 2021, the Housing Authority approved a Loan Agreement in the amount
of$1,656,947 and a ninety-nine (99) year Ground Lease with Shelter Providers of
Orange County, Inc. DBA HomeAid Orange County ("HomeAid") for the development of
FX Residences, a 17-unit permanent supportive housing development located at 801,
807, 809, and 809'/2 East Santa Ana Boulevard (Exhibit 1). [After this approval, HomeAid
changed their legal name to Shelter Providers of Southern California, Inc. and their
business name to HomeAid Orange County I Los Angeles.]At that time, the Housing
Authority also authorized the Executive Director to execute a future Subordination
Agreement with a senior lender as may be required to complete the project financing.
The Housing Authority's loan is secured by a Deed of Trust, Promissory Note, and
Affordability Restrictions recorded against the project.
FX Residences was completed in July 2025 and provides permanent supportive housing
for individuals and families experiencing homelessness and includes on-site supportive
services provided by Mercy House. The project was developed on Housing Authority-
Subordination Agreement and Lease Rider for FX Residences
June 16, 2026
Page 2
owned land through a 99-year Ground Lease with HomeAid and serves as an important
component of the City's success to reduce homelessness by over 25% since 2019.
Entering into an Agreement with the Housing Authority for the $1,656,947 loan, three (3)
project-based vouchers, and a 99-year Ground Lease were instrumental in facilitating the
development of the project and leveraging additional public and private investment. In
May 2026, FX Residences received the Supportive Housing Development Award at the
2026 Affordable Housing Awards ceremony.
Following completion and stabilization of the project, HomeAid now needs to secure their
permanent financing from the State of California Department of Housing and Community
Development ("HCD") through the State's No Place Like Home ("NPLH") Program. The
NPLH Program was established by the State of California to finance permanent
supportive housing for persons in need of mental health services and are experiencing
homelessness, chronic homelessness, or who are at risk of chronic homelessness. HCD
has approved a permanent loan in the amount of$3,006,567 to support the long-term
operation and financial sustainability of FX Residences. As a condition of funding their
loan, HCD requires the Housing Authority to execute a Subordination Agreement and
Lease Rider in favor of HCD.
Subordination Agreement
The proposed Subordination Agreement with HCD and HomeAid is attached as Exhibit
2. Under the terms of the Subordination Agreement, the Housing Authority agrees to
subordinate its existing $1,656,947 loan and related security interests to HCD's larger,
senior, permanent loan. HCD requires a first-priority lien position as a condition of
providing their permanent financing for the project. The Subordination Agreement
establishes that HCD's deed of trust, regulatory agreement, and related loan documents
will be senior to the Housing Authority's Deed of Trust and loan documents. However,
the Housing Authority's Affordability Restrictions will remain senior and will not be
subordinated to HCD's loan. The proposed subordination is consistent with standard
affordable housing financing requirements by HCD and it is required to facilitate the
closing of HCD permanent financing for affordable housing developments across the
State of California.
Lease Rider
The proposed Lease Rider to the Housing Authority's Ground Lease is attached as
Exhibit 3. Because FX Residences is located on land owned by the Housing Authority
and leased to HomeAid through a 99-year long-term Ground Lease, HCD requires a
Lease Rider as a condition of making its NPLH loan. The Lease Rider amends and
supplements certain provisions of the Ground Lease to recognize HCD's interests as a
senior lender and to provide HCD with protections customarily required in connection
with leasehold financing. Among other provisions, the Lease Rider acknowledges HCD's
loan and regulatory agreement, permits HCD to rely upon the Ground Lease as collateral
for its financing, and establishes certain notice and cure rights in favor of HCD in the
event of a default under the Ground Lease. The Lease Rider does not alter the Housing
Subordination Agreement and Lease Rider for FX Residences
June 16, 2026
Page 3
Authority's ownership of the property and does not change the underlying public purpose
of the project.
Approval of the Subordination Agreement and Lease Rider will allow HomeAid to receive
HCD's permanent loan financing and complete the transition from construction financing
to long-term permanent financing. The Housing Authority's existing Affordability
Restrictions and general public benefits associated with FX Residences will remain
unchanged. Moreover, approval of these documents will help ensure the long-term
financial stability and continued operation of the project as permanent supportive
housing serving vulnerable residents.
If the Housing Authority does not approve the Subordination Agreement and Lease
Rider, HCD will be unable to provide its NPLH loan of$3,006,567 for the project. This
will jeopardize the project's permanent financing structure, impair HomeAid's ability to
refinance their existing construction loan obligations, and negatively impact the long-term
viability of FX Residences. While the Housing Authority's loan will become subordinate to
HCD's senior loan, subordination was contemplated as part of the original financing
structure and authorized by the Housing Authority on December 7, 2021. As such, staff
recommends approval of the proposed Subordination Agreement and Lease Rider.
FISCAL IMPACT
There is no fiscal impact associated with approval of the Subordination Agreement and
Lease Rider. The proposed actions do not increase the Housing Authority's existing
loan commitment to FX Residences, require the expenditure of additional Housing
Authority funds, or modify the terms of the Housing Authority's $1,656,947 loan.
EXHIBIT(S)
1. Housing Authority Staff Report from December 7, 2021
2. Subordination Agreement
3. Lease Rider
Submitted By: Michael L. Garcia, Executive Director, Community Development Agency
Approved By: Alvaro Nunez, City Manager
EXHIBIT 2
FREE RECORDING IN ACCORDANCE
WITH CALIFORNIA GOVERNMENT
CODE SECTION 27383 and 27388.1.
RECORDING REQUESTED BY, AND
WHEN RECORDED, MAIL TO:
State of California
Department of Housing and
Community Development
P. O. Box 952052
Sacramento, CA 94252-2052
Attn: Legal Affairs Division
18-NPLH-12673
SUBORDINATION AGREEMENT
NOTICE: THIS SUBORDINATION AGREEMENT RESULTS IN YOUR SECURITY
INTEREST IN THE PROPERTY BECOMING SUBJECT TO AND OF LOWER PRIORITY
THAN THE LIEN OF SOME OTHER OR LATER SECURITY INSTRUMENT.
THIS SUBORDINATION AGREEMENT (the "Agreement") is dated as of June 16, 2026, for
reference purposes only, and is entered into by and among the Housing Authority of the City of
Santa Ana, acting as the Housing Successor Agency, a public body, corporate and politic, (the
"Junior Lienholder") and Shelter Providers of Southern California, Inc. DBA HomeAid Orange
County Los Angeles, a California nonprofit public benefit corporation (the "Borrower"), and the
Department of Housing and Community Development, a public agency of the State of California
(the "Senior Lender").
RECITALS
A. Borrower is the owner of the leasehold estate in that real property described in
Exhibit A attached hereto and made a part hereof (the "Property"). The Borrower has acquired
and constructed a 17 unit multifamily residential rental development on the Property (the
"Improvements"). The Property and the Improvements are sometimes referred to collectively
as the "Development."
B. The Junior Lienholder has made a loan to the Borrower in the principal sum of
One Million Six Hundred Fifty Six Thousand Nine Hundred Forty Seven and No/100 Dollars
($1,656,947.00) (the "Junior Lienholder Loan"). The Junior Lienholder Loan is evidenced by a
certain promissory note (the "Junior Lienholder Note"), secured by a certain deed of trust (the
NPLH R1 Subord. Agrmt Page 1 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
"Junior Lienholder Deed of Trust") recorded on January 14, 2022, as Instrument No.
2022000020118 in the Official Records of Orange County, California (the "Official Records").
C. The Junior Lienholder and Borrower have also entered into a certain Affordability
Restrictions on Transfer of Property, affecting the use of the Development, recorded on
January 14, 2022, as Instrument No. 2022000020116 in the Official Records (the "Affordability
Restrictions").
D. The Junior Lienholder and Borrower have also entered into a certain Loan
Agreement, affecting the use of the Development, recorded on January 4, 2023, as Instrument
No. 2023000001784 in the Official Records (the "Loan Agreement").
E. The Junior Lienholder Deed of trust and Loan Agreement are collectively referred
to as the ("Junior Lienholder Documents").
F. In order to finance the development of the Improvements, the Senior Lender has
agreed to loan the Borrower a sum not to exceed Three Million Six Thousand Five Hundred
Sixty Seven and No/100 Dollars ($3,006,567.00) (the "NPLH Loan"), subject to the terms and
conditions of: (i) a regulatory agreement restricting the use and occupancy of the Development
and the income derived therefrom which shall be dated as of even date herewith and recorded
concurrently herewith as an encumbrance on the Property in the Official Records (the "NPLH
Regulatory Agreement"), (ii) the Capitalized Operating Subsidy Reserve Agreement (the
"COSRA") if applicable, and (iii) other loan documents. The NPLH Loan will be evidenced by a
promissory note (the "NPLH Note"), the repayment of which will be secured by, among other
things, a deed of trust by Borrower as trustor, to Senior Lender as beneficiary recorded
concurrently herewith as an encumbrance on the Property in the Official Records (the "NPLH
Deed of Trust") and by such other security as is identified in other loan documents. The NPLH
Regulatory Agreement, the COSRA, the NPLH Note, the NPLH Deed of Trust and all other
documents evidencing or securing the NPLH Loan are collectively referred to herein as the
"Senior Lender Documents."
G. The Senior Lender is willing to make the NPLH Loan provided the Senior Lender
Documents are liens, claims or charges upon the Development prior and superior to the Junior
Lienholder Documents, and provided that the Junior Lienholder specifically and unconditionally
subordinates and subjects the Junior Lienholder Documents to the liens, claims or charges of
the Senior Lender Documents.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual benefits accruing to the parties hereto and
other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and
in order to induce the Senior Lender to make its NPLH Loan, it is hereby declared, understood
NPLH R1 Subord. Agrmt Page 2 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
and agreed as follows:
1. The Senior Lender Documents and any and all renewals, modifications,
extensions or advances thereunder or secured thereby (including interest thereon) shall
unconditionally be and remain at all times liens, claims, or charges on the Development prior
and superior to the Junior Lienholder Documents, and to all rights and privileges of the Junior
Lienholder thereunder; and the Junior Lienholder Documents, together with all rights and
privileges of the Junior Lienholder thereunder are hereby irrevocably and unconditionally
subject and made subordinate to the liens, claims or charges of the Senior Lender Documents.
2. This Agreement shall be the whole and only agreement with regard to the
subordination of the Junior Lienholder Documents, together with all rights and privileges of the
Junior Lienholder thereunder, to the liens, claims or charges of the Senior Lender Documents,
and this Agreement shall supersede and cancel any prior agreements to subordinate the claims,
liens or charges of, but only insofar as would affect the priority between the claims, liens or
charges of the Junior Lienholder Documents to the Senior Lender Documents including, but not
limited to, those provisions, if any, contained in the Junior Lienholder Documents, which provide
for the subordination of the lien or charge thereof to another lien or charge on the Property or
the Improvements.
3. The Junior Lienholder declares, agrees and acknowledges that:
(a) The Junior Lienholder consents and approves (i) all provisions of the Senior
Lender Documents, and (ii) all agreements among the Junior Lienholder, Borrower and
Senior Lender for the disbursement of the proceeds of the NPLH Loan, including without
limitation any loan escrow agreements which have been provided to the Junior
Lienholder for review;
(b) The Senior Lender, in making disbursements of the NPLH Loan pursuant to
the NPLH Note or any other agreement, is under no obligation or duty to, nor has the
Senior Lender represented that it will, see to the application of such proceeds by the
person or persons to whom the Senior Lender disburses such proceeds, and any
application or use of such proceeds for purposes other than those provided for in such
agreement or agreements shall not defeat the subordination herein made in whole or in
part;
(c) That none of the execution, delivery or recordation of any of the Senior Lender
Documents, or the performance of any provision, condition, covenant or other term
thereof, will conflict with or result in a breach of the Junior Lienholder Documents or the
Junior Lienholder Note; and
(d) The Junior Lienholder intentionally and unconditionally waives, relinquishes,
NPLH R1 Subord. Agrmt Page 3 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
subjects and subordinates the claims, liens or charges upon the Development of the
Junior Lienholder Documents, all present and future indebtedness and obligations
secured thereby, in favor of the claims, liens or charges upon the Development of the
Senior Lender Documents, and understands that in reliance upon, and in consideration
of, this waiver, relinquishment, subjection, and subordination, the NPLH Loan and
advances thereof are being and will be made and, as part and parcel thereof, specific
monetary and other obligations are being and will be entered into which would not be
made or entered into but for said reliance upon this waiver, relinquishment, subjection
and subordination.
4. Senior Lender hereby agrees, but only as a separate and independent covenant
of the Senior Lender and not as a condition to the continued effectiveness of the covenants and
agreements of the Borrower and the Junior Lienholder as set forth herein, as follows:
(a) Following a notice from the Senior Lender to the Borrower that a default or
breach exists under the terms of the Senior Lender Documents and each of them,
the Senior Lender shall promptly(but in no event later than the following business
day)send a copy of such notice to the Junior Lienholder and the Junior Lienholder
shall have the right, but not the obligation, to cure the default as follows:
(i) If the default is reasonably capable of being cured within thirty (30)
days, as determined by the Senior Lender in its sole discretion, the
Junior Lienholder shall have such period to effect a cure prior to
exercise of remedies by Senior Lender under the Senior Lender
Documents, or such longer period of time as may be specified in the
Senior Lender Documents.
(ii) If the default is such that it is not reasonably capable of being cured
within thirty (30) days, as determined by the Senior Lender in its sole
discretion, or such longer period if so specified, and if the Junior
Lienholder (a) initiates corrective action within said period, and (b)
diligently, continually, and in good faith works to effect a cure as soon
as possible, then the Junior Lienholder shall have such additional time
as is determined by the Senior Lender, in its sole discretion, to be
reasonably necessary to cure the default prior to exercise of any
remedies by Senior Lender.
In no event shall Senior Lender be precluded from exercising 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 is given, or such
longer period of time as may be specified in the Senior Lender Documents.
NPLH R1 Subord. Agrmt Page 4 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
Nothing in this subparagraph (a) is intended to modify any covenant, term or condition
contained in the Senior Lender Documents, including, without limitation, the covenant
against creating or recording any liens or encumbrances against the Property without the
prior written approval of the Senior Lender.
(b) The provisions of this paragraph 4 are intended to supplement, and not to
limit, waive, modify or replace, those provisions of law pertaining to notice and
cure rights of junior lenders including, without limitation, those set forth in
California Civil Code sections 2924b and 2924c.
(c) This Agreement does not apply to or subordinate the Affordability Restrictions.
5. The Senior Lender would not make the NPLH Loan without this Agreement.
6. This Agreement shall be binding on and inure to the benefit of the legal
representatives, heirs, successors and assigns of the parties.
7. This Agreement shall be governed by and construed in accordance with the laws
of the State of California.
8. In the event that any party to this Agreement brings an action to interpret or enforce
its rights under this Agreement, the prevailing party in such action shall be entitled to recover its
costs and reasonable attorneys' fees as awarded by the court in such action.
9. This Agreement may be signed by different parties hereto in counterparts with the
same effect as if the signatures to each counterpart were upon a single instrument. All
counterparts shall be deemed an original of this Agreement.
NOTICE: THIS SUBORDINATION AGREEMENT CONTAINS A PROVISION WHICH
ALLOWS THE PERSON (OR ENTITY) OBLIGATED ON YOUR REAL PROPERTY
SECURITY TO OBTAIN A LOAN A PORTION OF WHICH MAY BE EXPENDED FOR OTHER
PURPOSES THAN IMPROVEMENT OF THE LAND.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth
above and agree to be bound hereby:
[Signatures follow on page 6 of this Subordination Agreement. The remainder of this
page is blank.]
NPLH R1 Subord. Agrmt Page 5 of 9
(NOFA—10/15/2018,Amended 10130/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
JUNIOR LIENHOLDER:
Housing Authority of the City of Santa Ana,
a public body, corporate and politic
ATTEST: HOUSING AUTHORITY OF THE CITY
OF SANTA ANA
Jennifer L. Hall Michael L. Garcia
Recording Secretary Secretary/Executive Director
APPROVED AS TO FORM:
SONIA R. CARVALHO
General Counsel
By:M& R 66
Matthew R. Cody
Special Counsel
Best, Best&Krieger
[Signatures follow on page 7 of this Subordination Agreement. The remainder of this
page is blank.]
NPLH R1 Subord. Agrmt Page 6 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
BORROWER:
Shelter Providers of Southern California, Inc. DBA HomeAid Orange County Los
Angeles,
a Califor ' nbnpr . blic ben fit corporation
By:
Gina R. Cunningh
Executive Director
[Signatures follow on page 8 of this Subordination Agreement. The remainder of this
page is blank.]
NPLH R1 Subord.Agrmt Page 7 of 9
(NOFA-10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessors Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
SENIOR LENDER:
The Department of Housing and
Community Development, a public
agency of the State of California
By:
Sanjeewa Devanarayana, Closing Manager
[Signatures must be acknowledged.]
NPLH R1 Subord. Agrmt Page 8 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 2
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
A Leasehold Estate created by that certain Lease executed by Housing Authority of the City of
Santa Ana, a public body, corporate and politic, lessor, and Shelter Providers of Orange County,
Inc., DBA HomeAid Orange County, Lessee and subject to all of the provisions therein
contained, as disclosed by Memorandum of Lease, dated December 30, 2022 recorded January
4, 2023 as Instrument No. 2023000001781 of Official Records of Orange County, California for
the term and upon the terms and conditions contained in said lease.
Real property in the City of Santa Ana, County of Orange, State of California, described as
follows:
Being portions of Lots 13, 14, 15, and 16 in Block 66 of SANTA ANA EAST, as shown on a map
recorded in Book 10, Pages 43 and 44 of miscellaneous records of Los Angeles County,
California, more particularly described as follows:
Beginning at the intersection of the centerline of Garfield Street and Santa Ana Boulevard as
shown on said map; thence North 25032'22" West along said Garfield Street centerline, a
distance of 39.91 feet; thence at right Angles North 64°27'38" East a distance of 40.00 feet to
the Easterly right of way line of said Garfield Street, Garfield Street being 80 feet in width, said
point being the Southwest corner of said lot 16 and the true Point of Beginning; thence North
25032'22" West along said Easterly right of way line, a distance of 100.00 feet, to the Northwest
corner of said lot 13; thence North 64035'19" East, along the Northerly line of said Lot 13, a
distance of 150.00 feet to the Northeast corner of said Lot 13, said corner being on the Westerly
right of way line of a public alley, 20 feet in width; thence South 25°32'22" east, along said
Westerly right of way line, a distance of 100.00 feet to the Northerly right of way line of said
Santa Ana Boulevard, Santa Ana Boulevard being 80.00 feet in width, said point also being the
Southeast corner of said Lot 16; thence South 64'35'19" West, along said Northerly right of way
of said Santa Ana Boulevard, said line also being the Southerly line of said Lot 16, a distance of
150.00 feet, to the Southwest corner of said Lot 16, said corner also being the intersection of
the Easterly right of way line of Garfield Street and Northerly right of way line of Santa Ana
Boulevard and the true Point of Beginning.
The above legal description is pursuant to that Lot Merger No. 2022-01, recorded April
18, 2023 as Instrument No. 2023000088045 of Official Records.
APN: 398-303-04, 398-303-05, 398-303-06 and 398-303-07
NPLH R1 Subord. Agrmt Page 9 of 9
(NOFA—10/15/2018,Amended 10/30/2018)
Rev:3/12/2024
Prep: 6/1/2026(Housing Authority of the City of Santa Ana Loan)
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
Free recording in accordance with
California Government Code
section 27383 and 27388.1.
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
State of California
Department of Housing and
Community Development
P.O. Box 952054
Sacramento, CA 94252-2054
Attn: Legal Affairs Division
No Place Like Home Program
18-NPLH-12673
LEASE RIDER
(Ground Lease)
This Lease Rider (the "Agreement") is made and entered into as of June 16, 2026, for
reference purposes only, by and among the Housing Authority of the City of Santa Ana, a
public body, corporate and politic (the "Landlord"), and Shelter Providers of Southern
California, Inc. DBA HomeAid Orange County Los Angeles, a California nonprofit public
benefit corporation (the "Lessee"), and the Department of Housing and Community
Development, a public agency of the State of California (the "Department") in consideration
of the following facts and circumstances:
A. Landlord is the fee simple owner of that certain real property described in Exhibit A
attached hereto and incorporated herein (the "Property");
B. Landlord and Shelter Providers of Southern California, Inc. DBA HomeAid Orange
County Los Angeles, a California nonprofit public benefit corporation entered into the
following ground lease of the Property: that certain Ground Lease dated December 7, 2021
and recorded in the official records of Orange County, California (the "Official Records"), that
certain Memorandum of Lease dated December 30, 2022, and recorded in the Official
Records on January 4, 2023, as instrument No. 2023000001781 of Official Records (the
"Lease");
C. Pursuant to the Lease, Lessee has agreed to develop, construct, own, operate and
manage a rental housing development on the Property consisting of not less than 17
residential rental units. Lessee is the owner of the fee interest in all of those certain
buildings, improvements and fixtures now or hereafter erected thereon, and all
NPLH Lease Rider Page 1 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
appurtenances, easements, and articles of property now or hereafter affixed to, placed upon
or used in connection with such real property and owned by Lessee or in which Lessee has
an interest, together with all additions to, substitutions for, changes in our replacements of
the whole or any part of said articles of property (collectively, the "Improvements.").
Collectively, the Property and the Improvements are hereinafter sometimes referred to as
the Development (the "Development");
D. The Department has agreed to loan an amount not to exceed Three Million Six
Thousand Five Hundred Sixty Seven and No/100 Dollars ($3,006,567.00) (the "Loan") to
Lessee to finance the Development, in part, pursuant to the No Place Like Home Program
("NPLH"). The Loan is subject to numerous terms and conditions, including without
limitation, the execution and delivery of this Agreement;
E. As a further condition of the Loan and pursuant to the requirements of the Program,
Lessee and the Department have entered into a Regulatory Agreement, including any
amendments thereto (the "Regulatory Agreement"), governing the use, occupancy,
operation, management and ownership of the Development. Landlord and Lessee hereby
waive any such provisions of the Lease in conflict with or which would frustrate Lessee's
compliance with the Regulatory Agreement in favor of the terms of the Regulatory
Agreement.
F. The Loan will be evidenced by the Promissory Note (the "Note") from Lessee and
secured by a Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing
(the "Trust Deed") on Lessee's interests in the Property; and
G. Lessee and Landlord have requested that the Department accept the Lease as
security for the Loan. In order to induce the Department to make the Loan, Landlord and
Lessee have agreed to enter into and record this Agreement for the benefit of the
Department, its successors, and assigns.
H. This Agreement amends, and is made part of, the Lease. As a result, this
Agreement encumbers the Development and must be recorded on the Property.
NOW THEREFORE, in consideration of the foregoing recitals and the mutual covenants
hereinafter contained, the Department, Lessee and Landlord hereby agree as follows:
1. Leasehold. As used herein, "Leasehold" means all of Lessee's interest in the Property
described in Exhibit A, in the Development, in the Improvements now or hereafter located
on the Property, all options contained in the Lease or granted in connection with the Lease,
all other rights of Lessee under the Lease, and all subleases entered into in connection with
the Lease (the "Subleases").
2. Representations and Warranties of Landlord. Landlord hereby represents and
NPLH Lease Rider Page 2 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
warrants to the Department as follows:
a. Title. Landlord's interest in the Development is free and clear of all liens,
encumbrances, covenants, easements, licenses, judgments, or other matters of
record except those shown as affecting the fee interest of the Property in that certain
Preliminary Report regarding the Property dated April 30, 2026, and revised on May
11, 2026, issued by First American Title Company, for Escrow No. 7361217, Order
No. NHSC-7361217 (the "Report"). The Report is attached hereto as Exhibit B.
Landlord has not required or permitted and has no knowledge of any other matters of
record to be recorded that are not contained in the Report.
b. Priority. The Lease is superior to any and all mortgage liens on the Property.
c. Transfers by Landlord. Landlord has not assigned, mortgaged, or otherwise
hypothecated or transferred, or agreed to assign, mortgage or otherwise hypothecate
or transfer, its interest in the Property and the Development in whole or in part, except
as shown in the Report and except as security for loans to Lessee approved in writing
by the Department.
d. Status of Lease.
(1) Landlord is the current Lessor under the Lease. The Lease is in full force,
the Lease is not void, voidable or terminable at the option of any party thereto or
of any other person or entity claiming an interest in or to such Lease or the
Development, and there has been no default thereunder on the part of Lessee,
nor has any event occurred which, with the giving of notice or the passage of time,
or both, would be an event of default thereunder. Landlord has not been informed
of and has not otherwise received notice from Lessee or from any other person
or entity concerning any alleged default on the part of Landlord under the Lease.
(2) Any consent or approval of any third party (including any lender) that is
required to deliver this Agreement has been obtained.
(3) To Landlord's actual knowledge, no alterations, improvements or additions
now exist on the Property that have not been approved by the Landlord.
e. Other Agreements. All terms and conditions of the Lessee's tenancy under the
Lease are set forth in the Lease and there have been no further or other supplements,
amendments, modifications or extensions thereof except those submitted to and
approved by the Department. Nothing in this Lease Rider is intended to waive,
supercede, modify or terminate any provision of the Lease granting rights to the
Department as a Mortgage Lender.
f. Lease Term. The date of the commencement of the Lease term is the date on
NPLH Lease Rider Page 3 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
which a certificate of occupancy is issued for the Development and will end on the
99t" anniversary of the date of the commencement of the Lease, subject to options
described in the Lease. All conditions precedent to the effectiveness of the Lease
and/or the exercise of any of Lessee's rights thereunder has been fully satisfied.
Notwithstanding anything in the Lease to the contrary, Lease shall not expire prior to
payment in full of the Department's Loan and fulfillment of Lessee's obligations under
the Regulatory Agreement.
g. Development. To Landlord's actual knowledge, the Development constructed, or
to be constructed, by Lessee on the Property satisfies all requirements affecting the
design, use or characteristics of such Development imposed by Landlord under the
Lease or otherwise, any and all applicable provisions of federal, state and local laws,
and all agreements with any public entities concerning the Development, as amended
from time to time.
h. Insurance. All notices, certificates, binders, endorsements, copies of policies,
and receipts required under the Lease have been delivered and approved by
Landlord.
3. Cancellation, Transfer of Interest.
a. Landlord and Lessee agree that so long as the Department, its successor or
assigns holds the Trust Deed and Regulatory Agreement encumbering the Property,
no termination of the Lease by Lessee, and no subordination, cancellation, surrender,
amendment or modification of the Lease shall be effective without the prior written
consent of the Department, which consent shall be in the Department's sole and
absolute discretion, and may be conditioned upon the satisfaction of such terms and
conditions as the Department may prescribe. Any attempt by Lessee to take such
action shall be void without the Department's prior written consent.
b. Landlord agrees that it shall not transfer, convey, sell, hypothecate, assign,
encumber or permit any liens against its interest, or any portion thereof, in the Property
or the Development without the prior written approval of the Department, which
consent shall be in the Department's sole and absolute discretion, and may be
conditioned upon the satisfaction of such terms and conditions as the Department
may prescribe. If the Department approves any such transfer, conveyance, sale,
hypothecation, assignment or other encumbrance of its interest, or any portion
thereof, in the Property or the Development, Landlord will require that any purchaser,
assignee or transferee expressly assume all of the obligations of Landlord under the
Lease and this Agreement by a written instrument recordable in the Official Records.
c. Bankruptcy. Neither the Landlord nor the Lessee, in the event of bankruptcy by
either, will take the benefit of any provisions in the United States Bankruptcy Code
NPLH Lease Rider Page 4 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
that would cause the termination of the Lease or otherwise render it unenforceable in
accordance with its terms.
d. No Merger. There shall be no merger of the Lease or any interest in the Lease,
nor of the Leasehold interest, with the fee estate in the Property if the Lease or such
interest therein, or such Leasehold estate may be directly or indirectly held by or for
the account of any person who shall hold the fee estate in the Property, or any interest
in such fee estate, nor shall there be such a merger by reason of the fact that all or
any part of the Leasehold estate created thereby may be conveyed or mortgaged in
a leasehold mortgage, deed of trust, or other security instrument to a leasehold
mortgagee that shall hold the fee estate in the Development or any interest of the
Landlord under the Lease.
4. Consent to Assignment, Payment of Rent.
a. Landlord hereby consents to and approves the following to the extent such
consents or approvals are required under the Lease:
(1) Lessee's encumbering the Lease, the Leasehold and the Development by
the Trust Deed and the Regulatory Agreement; possession of the Property and
any Development thereon by the Department or by a receiver under the Trust
Deed or the Regulatory Agreement; and sale of the Leasehold and the
Development by foreclosure under the Trust Deed or transfer by deed in lieu of
foreclosure;
(2) Assignments to the Department or its designee of any subleases and any
and all rents from such subleases; and
(3) Sale or assignment of all or any part of any interest in the Leasehold to any
purchaser at a foreclosure sale under the Trust Deed or to any transferee of a
deed in lieu of foreclosure (such purchaser or transferee, including the
Department, is collectively referred to as the "Transferee"), and to subsequent
transfers without restriction (all such assignments, transfers, and subsequent
transfers referred to in this Agreement as the "Transfer"). Any such Transferee,
upon the Transfer of all its interest in the Development and the Leasehold, shall
be relieved of all liability under the Lease accruing after date of such Transfer.
b. Nothing in this Agreement, in the Trust Deed or in the Lease shall impose on the
Department the obligations of Lessee under the Lease or require the Department to
assume the Lease unless the Department forecloses on the Leasehold under the
Trust Deed or accepts an assignment or deed in lieu of foreclose.
5. Notice of Defaults; Termination Notice.
NPLH Lease Rider Page 5 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
a. Notice and Cure. Landlord shall provide simultaneously to the Department a
written copy of all notices and demands, including, without limitation, notices of
default or breach which Landlord has given, delivered or sent to Lessee under the
Lease. No notice or demand under the Lease shall be effective unless and until a
copy of such notice is provided to the Department as provided herein. Any notice of
default under the Lease or this Agreement shall describe the default(s) with
reasonable detail. The Department shall have the right, but not the obligation, to cure
any breach or default within the time period given in the Lease; provided that, if such
notice to the Department is not given or is delayed for any reason, the period of time
within which the Department may cure any such breach or default shall commence
upon receipt by the Department of such notice. Landlord and Lessee authorize the
Department to enter the Development for the purpose of preventing defaults or
exercising its right to cure and any other powers given the Department under the
Trust Deed, this Agreement or the Lease.
b. Termination Notice. After the expiration of the grace period given Lessee under
the Lease to cure the default, Landlord shall not terminate the Lease on account of
such default but shall give the Department a written notice (the "Termination Notice")
that Lessee has failed to cure the default within the grace period and that, on account
thereof, Landlord intends to terminate the Lease, which notice shall set a termination
date not earlier than ninety (90) days after the Department's receipt of the
Termination Notice, provided that Landlord agrees to extend such termination date if
the Department reasonably requires additional time to accommodate the
Department's taking possession of the Development where possession is necessary
to cure Lessee's default. No Termination Notice shall be effective to terminate the
Lease if:
(1) Except as provided in section 5.c., within ninety (90) days after receipt of
the Termination Notice, the Department cures any default which can be cured
by payment or expenditure of money or without possession of the Development;
or provides reasonable assurance and undertakings for the cure of such default.
To effect a cure of Lessee's default, the Department may make any repair of
improvement, do any other act or thing required of Lessee under the Lease, or
do any act or thing which may be necessary or proper to prevent termination of
the Lease. The Department and its agents and contractors will have full access
to the Development for purposes of accomplishing the curing of defaults under
the Lease. Any of the foregoing done by the Department shall be as effective to
prevent a termination of the Lease as the same would have been if done by
Lessee; or
(2) The Department commences and diligently pursues to completion
proceedings for foreclosure and sale under the Trust Deed or assignment or
NPLH Lease Rider Page 6 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
transfer in lieu of foreclosure.
c. Defaults Not Susceptible to Department Cure. The Department shall not be
required to perform any act which is not susceptible to performance by the
Department, such as to cure a filing or condition of bankruptcy or insolvency or to
cure or commence the cure of any default which is Lessee's failure to pay any lien,
charge or encumbrance which is junior in priority to the Trust Deed, or to pay any
amount owed under an indemnity of Landlord by Lessee based on an event occurring
prior to the Department's possession of the Development.
d. Landlord's Payment of Loan Payments. Landlord agrees that if Landlord cures
Lessee's failure to make any payment due under the Loan, it shall seek
reimbursement of amounts so paid solely from Lessee and the Department shall
have no obligation to pay such amounts to Landlord.
e. Waiver of Breach or Default. On transfer of the Leasehold at any foreclosure
sale under the Trust Deed or by acceptance of a deed in lieu of foreclosure, all
violations, defaults and breaches by Lessee under the Lease, including, without
limitation, nonpayment of rent or other amounts payable under the Lease, shall be
deemed personal obligations of Lessee, and the Department or other Transferee
shall be entitled to the New Lease as described in section 6 below without incurring
or assuming any liability or obligation of, or claim against, Lessee under the Lease.
Nothing in this section shall be deemed a waiver of any claim by Landlord against
Lessee under the Lease.
f. Enforcement Not a Breach. No action taken by the Department to enforce its
rights under any of the documents governing the Loan against either the Landlord or
the Lessee, or both, including, without limitation, any actions taken to collect any
amounts due and owing to the Department or any action to appoint a receiver for the
Development or to otherwise protect the security of the Loan, shall constitute or result
in a breach or violation of the Lease.
g. Status Quo Ante. Any default by Lessee shall not prejudice the Department if the
Department chooses to cure such default within the applicable grace period, and
Landlord acknowledges and agrees that upon the Department's cure of any such
default, the Lease shall be restored status quo ante.
6. New Lease.
a. Conditions. Section 5 hereof notwithstanding, Landlord agrees to comply with
the requirements of subsection 6.b., if the following conditions specified in this
subsection 6.a. apply:
NPLH Lease Rider Page 7 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
(1) The Lease is terminated for any reason whatsoever or if the Department
forecloses under the Trust Deed or accepts a deed in lieu of foreclosure; and
(2) Department or other Transferee, whether or not such party has assumed
the Lease, requests Landlord in writing to enter into a new lease of the Property
within ninety (90) days after (a) the Department completes a foreclosure under
the Trust Deed, or (b) the Department accepts a deed in lieu of foreclosure, or
the end of the cure period provided to the Department in the Termination Notice
(the "New Lease").
b. Obligations. If the conditions specified in section 6.a. have been satisfied,
Landlord shall:
(1) upon receipt of the request for New Lease described in subsection 6.a.(2)
above, enter into a New Lease of the Property with the Department, its nominee,
or its successor-in-interest or other Transferee, for the remainder of the term of
the Lease, effective as of the date of the termination or conveyance pursuant to
a foreclosure sale or of a deed-in-lieu of foreclosure. The New Lease shall be at
the rent of, and consistent with the terms, provisions, covenants, options and
agreements contained in the terminated or foreclosed Lease, or granted by the
Landlord in connection with the Lease, all as modified or supplemented by this
Agreement;
(2) convey by grant deed to the Department, its nominee or its
successor-in-interest or other Transferee, all title and interest to the
Improvements, if any, which may become vested in Landlord as a result of any
termination of the Lease or foreclosure of the Trust Deed or conveyance of
Lessee's interest by deed in lieu of foreclosure, provided, however, this paragraph
does not require conveyance of the Property;
(3) assign to the Department, its nominee, or its successor-in-interest or other
Transferee, all of Landlord's interest, if any, in all existing subleases of all or any
part of the Development and all attornments given by the sublessees.
c. Priority. The Leasehold estate and the title (if any) in the Development granted
to the Department, its nominee or its successor-in-interest under this section 6 shall
be prior to any mortgage or other lien, charge or encumbrance on the Development,
except as approved in writing by the Department or as shown in the Report
7. Successors to Department. Subject to section 4 hereof, if the Leasehold is transferred
by a foreclosure sale under the Trust Deed or by a deed in lieu of foreclosure, Landlord shall
recognize the Transferee as the tenant under the Lease. Anything in the Lease
NPLH Lease Rider Page 8 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
notwithstanding, the rights and benefits of the Department under this Agreement shall
benefit and may be exercised by any Transferee or by the holder of any mortgage or deed
of trust which may be given to secure a portion of the purchase price in any sale by the
Department or its successor(s) after the Department acquires the Leasehold or enters into
a New Lease under this Agreement.
8. Diligence of Department. So long as the Department is prevented by any process or
injunction issued by any court or by any statutory stay, or by reason of any action by any
court having jurisdiction of any bankruptcy or insolvency proceeding involving Landlord or
Lessee, from commencing or prosecuting foreclosure or other appropriate proceedings in
the nature thereof, the Department shall not be deemed for that reason to have failed to
commence such proceedings or to have failed to prosecute diligently such proceedings,
provided, however, that the Department shall use reasonable efforts to contest and appeal
the issuance or continuance of any such process, stay or injunction.
9. Condemnation and Insurance Proceeds.
a. Anything in the Lease notwithstanding, all fire and other hazard or casualty
insurance proceeds shall be paid to the Department to the extent required by the
Regulatory Agreement and subject to the rights of senior mortgage holders. In
addition, in the event of any condemnation or partial condemnation, all condemnation
award proceeds payable on account of such condemnation or partial condemnation
shall be paid to the Department to the extent required by the Regulatory Agreement,
subject to the rights of holders of senior mortgages, if any.
b. During the term of the Loan, the Department shall have the right to participate in
any settlement or stipulation of judgment with respect to any condemnation
proceeding entered into with the condemnation authority affecting all or any portion
of the Development or any agreement to sell all or any portion of the Development in
lieu of condemnation, and no such settlement, stipulation or agreement shall be
made or entered into without the Department's prior written consent, which consent
shall be in the Department's sole and absolute discretion and may be conditioned
upon the satisfaction of such terms and conditions as the Department may prescribe.
Department shall also have the right (but not the obligation) to participate in any
settlement, discussion, and/or arbitration proceeding between Landlord and Lessee
with respect to the apportionment or application of any condemnation award.
10. Certificate by Landlord. Within fifteen (15) calendar days after written request by the
Department, Landlord shall execute and deliver to the Department or to any proposed
purchaser or encumbrancer of Lessee's estate a certificate declaring (i) the existence and
validity of the Lease, or New Lease as the case may be, and amendments thereto, if any,
remains in full force and effect; (ii) that all conditions under the Lease, or New Lease, have
been satisfied, and that there are no defaults under the Lease or New Lease, or if there has
NPLH Lease Rider Page 9 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
been a default under the Lease or New Lease, a description of the nature of such default;
(iii) any other information relating to the condition of the Lease, the Property or the
Development reasonably requested by the Department; and (iv) that Landlord understands
the recipient will rely on the certificate and that the Landlord will describe in reasonable detail
any exceptions to the foregoing statements.
11. Notices. Notices and other communications required by this Agreement shall be
delivered by messenger to the addresses provided below or sent by U.S Postal Service
certified mail, return receipt requested, postage prepaid, addressed as follows:
To Department: Department of Housing and Community Development
No Place Like Home (NPLH) Program
P.O. Box 952054
Sacramento, CA 94252-2054
Attn. Closings Manager
or:
651 Bannon Street, Suite 400
Sacramento, CA 95811
Attn: Closings Manager
To Landlord: Housing Authority of the City of Santa Ana
20 Civic Center Plaza,
Santa Ana, California 92702
Attn: Executive Director
To Lessee: Shelter Providers of Southern California, Inc.
DBA HomeAid Orange County Los Angeles
17821 17th Street Suite 120,
Tustin, California 92780
These addresses may be changed by a notice given in the same manner provided that
Landlord acknowledges and agrees that it shall have a duty to verify the addresses provided
herein. Notices shall be effective on receipt.
12. Department's Rights Against Lessee. Nothing in this Agreement shall limit or
restrict the Department's rights and remedies under the Note, the Trust Deed, the
Regulatory Agreement, or any other agreement between the Department and Lessee.
13. Successors and Assigns. This Agreement shall inure to the benefit of and bind the
successors and assigns of the Department, Landlord and Lessee.
14. Uninsured Hazard. Landlord agrees that neither the Department nor any person
acquiring the Property or a portion of the Leasehold pursuant to a foreclosure under the
NPLH Lease Rider Page 10 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
Trust Deed, or deed in lieu of foreclosure, nor the lessee under a New Lease pursuant to
section 6 hereof, nor any successive owner of a portion of the Leasehold after such
foreclosure or New Lease shall have any obligation hereunder or under the Lease or New
Lease to repair or reconstruct any damage or loss to the Development which is due to a
hazard not required to be covered by insurance under the Lease or New Lease.
15. Duty to Repair. Landlord agrees that if the Department, its nominee, or its
successor-in-interest succeeds to Lessee's leasehold interest in the Property and if the
Development on the Property shall have been or becomes materially damaged before or
after the date of such acquisition, the Department's, its nominee's, or its
successor-in-interest's obligation, if any, to repair, replace or reconstruct the Development
shall in any such event be limited to the greater of: i) the amount of the net insurance
proceeds received by the Department by reason of that damage or ii) the amount the
Department would be entitled to if in compliance with the minimum insurance requirements
of Lessee under the Lease.
16. Options. Landlord and Lessee agree that the Department may exercise any option
to extend the term of the Lease or to purchase any interest in the Property which is granted
to Lessee under or in connection with the Lease.
17. Limitation on Liabilitv. If the Department agrees to be bound by the terms of the
Lease, or in the event of any Transfer to a Transferee, neither the Department nor
Transferee shall have any obligation under the Lease with respect to any liabilities,
obligations, losses, damages, fines, penalties, claims, demands, suits, actions, causes of
actions, charges, judgments, costs, and expenses (including architects' and attorneys' fees
and court costs) arising out of or resulting from acts, omissions, circumstances or events
occurring before or existing at the time of such Transfer or the Department's agreement to
be bound by the Lease. Nothing in this Agreement or in the Lease shall impose on the
Department any liability to perform the obligations of Lessee under the Lease or require the
Department to assume the Lease unless and until the Department acquires Lessee's rights
by foreclosure or deed in lieu of foreclosure. After acquiring Lessee's rights by foreclosure
or deed in lieu of foreclosure, the Department shall be liable to perform Lessee's obligations
only until the Department assigns or transfers the Leasehold. The Department shall not,
however, be required to cure Lessee's defaults occurring before the Department's
acquisition of Lessee's rights by foreclosure.
18. Conflict With Lease. The provisions herein are intended to be supplementary to, and
not in derogation of, the parties' rights and obligations contained in the Lease (including all
of the Department's rights under the Lease as a leasehold mortgagee), but in the event of
any conflict or inconsistency between the terms of the Lease and the terms of this
Agreement, the terms of this Agreement shall govern and control, and the Lease shall be
deemed to be modified hereby.
NPLH Lease Rider Page 11 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
19. Attorney Fees, Costs. In any action to enforce or relating to any provision of this
Agreement, the prevailing party shall be entitled to recover from the other party, its costs
and expenses. The term "costs and expenses" as used herein shall include all costs and
expenses actually and reasonably incurred, including by not limited to attorney's fees; filing,
motion, and jury fees; juror food and lodging; taping, videotaping, and transcribing
depositions and travel expenses to attend depositions; service of process by a public officer,
registered process server, or other means; expenses of attachment including keeper's fees;
premiums on surety bonds; ordinary witness fees pursuant to section 68093 of the California
Government Code; fees of expert witnesses whether or not ordered by the court; transcripts
of court proceedings whether or not ordered by the court; court reporters fees as established
by statute; investigation expenses in preparing the case for trial; postage, telephone, and
photocopying charges; costs in investigation of jurors or in preparation for voir dire; models,
blowups and photocopies of exhibits, and any other item that is required to be awarded to
the prevailing party pursuant to statute as an incident to prevailing in the action at trial or on
appeal. Such costs and expenses shall be recoverable whether the services were rendered
by a salaried employee of the party or by an independent contractor.
20. Acknowledgment. Landlord and Lessee acknowledge that the Department is relying
on the foregoing representations,warranties, covenants and agreements of the undersigned
in making the Loan to Lessee, and warrants and affirms to and for the benefit of the
Department that each of those representations is true, correct and complete as of this date.
[Signatures follow on page 13 of this Lease Rider. The remainder of this page is
blank.]
NPLH Lease Rider Page 12 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
LANDLORD:
Housing Authority of the City of Santa Ana,
a public body, corporate and politic
ATTEST: HOUSING AUTHORITY OF THE CITY
OF SANTA ANA
Jennifer L. Hall Michael L. Garcia
Recording Secretary Secretary/Executive Director
APPROVED AS TO FORM:
SONIA R. CARVALHO
General Counsel
By: NAj R 4
Matthew R. Cody
Special Counsel
Best, Best& Krieger
[Signatures must be acknowledged.]
[Signatures continue on page 14. Remainder of this page is blank.]
NPLH Lease Rider Page 13 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
LESSEE:
Shelter Providers of Southern California, Inc. DBA HomeAid Orange County Los
Angeles,
a Californi o6 ro i
c bene i corporation
By:
Gina R. Cunni gh` m;
Executive Director
[Signatures must be acknowledged.]
[Signatures continue on page 15. Remainder of this page is blank.]
NPLH Lease Rider Page 14 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
SENIOR LENDER:
The Department of Housing and Community
Development, a public agency of the State of California
By:
Sanjeewa Devanarayana, Closing Manager
[Signatures must be acknowledged.]
NPLH Lease Rider Page 15 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
Real property in the City of Santa Ana, County of Orange, State of California, described as
follows:
Being portions of Lots 13, 14, 15, and 16 in Block 66 of SANTA ANA EAST, as shown on a map
recorded in Book 10, Pages 43 and 44 of miscellaneous records of Los Angeles County,
California, more particularly described as follows:
Beginning at the intersection of the centerline of Garfield Street and Santa Ana Boulevard as
shown on said map; thence North 25032'22" West along said Garfield Street centerline, a
distance of 39.91 feet; thence at right Angles North 64°27'38" East a distance of 40.00 feet to
the Easterly right of way line of said Garfield Street, Garfield Street being 80 feet in width, said
point being the Southwest corner of said lot 16 and the true Point of Beginning; thence North
25032'22" West along said Easterly right of way line, a distance of 100.00 feet, to the Northwest
corner of said lot 13; thence North 64°35'19" East, along the Northerly line of said Lot 13, a
distance of 150.00 feet to the Northeast corner of said Lot 13, said corner being on the Westerly
right of way line of a public alley, 20 feet in width; thence South 25032'22" east, along said
Westerly right of way line, a distance of 100.00 feet to the Northerly right of way line of said
Santa Ana Boulevard, Santa Ana Boulevard being 80.00 feet in width, said point also being the
Southeast corner of said Lot 16; thence South 64035'19" West, along said Northerly right of way
of said Santa Ana Boulevard, said line also being the Southerly line of said Lot 16, a distance of
150.00 feet, to the Southwest corner of said Lot 16, said corner also being the intersection of
the Easterly right of way line of Garfield Street and Northerly right of way line of Santa Ana
Boulevard and the true Point of Beginning.
The above legal description is pursuant to that Lot Merger No. 2022-01, recorded April
18, 2023 as Instrument No. 2023000088045 of Official Records.
APN: 398-303-04, 398-303-05, 398-303-06 and 398-303-07
NPLH Lease Rider Page 16 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
EXHIBIT B
The Report
NPLH Lease Rider Page 17 of 17
Rev:7/16/2024
Prep: 6/1/2026
Dev: Francis Xavier Residence
Assessor's Identification Number:398-303-04,398-303-05,398-303-06 and 398-303-07
Loan No.: 18-NPLH-12673
EXHIBIT 3
CLTA Preliminary Report Form Order Number: 5850714-A (tc)
(Rev. 11/06) Page Number: 1
Post Closing Report
* .� A W f rt
First American Title Company
4140 Temescal Canyon Rd, Ste 301
Corona, CA 92883
Customer Reference: 801, 807, 809 &809 1/2 E. Santa Ana Blvd
Order Number: 5850714-A (tc)
Title Officer: Terrell Crutchfield
Phone: (951)256-5879
Fax No.: (866)558-2872
E-Mail: tcrutchfield@firstam.com
Escrow Officer: Sheri Keene
Phone: (858)410-1305
Fax No.: (866)898-0113
E-Mail: X_skeene@firstam.com
Buyer:
Property:
Santa Ana, CA
PRELIMINARY REPORT
In response to the above referenced application for a policy of title insurance,this company hereby reports that it is prepared to
issue,or cause to be issued,as of the date hereof,a Policy or Policies of Title Insurance describing the land and the estate or
interest therein hereinafter set forth, insuring against loss which may be sustained by reason of any defect,lien or encumbrance not
shown or referred to as an Exception below or not excluded from coverage pursuant to the printed Schedules,Conditions and
Stipulations of said Policy forms.
The printed Exceptions and Exclusions from the coverage and Limitations on Covered Risks of said policy or policies are set forth in
Exhibit A attached. The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less than that set
forth in the arbitration clause,all arbitrable matters shall be arbitrated at the option of either the Company or the Insured as the
exclusive remedy of the parties. Limitations on Covered Risks applicable to the CLTA and ALTA Homeowner's Policies of Title
Insurance which establish a Deductible Amount and a Maximum Dollar Limit of Liability for certain coverages are also set forth in
Exhibit A. Copies of the policy forms should be read.They are available from the office which issued this report.
Please read the exceptions shown or referred to below and the exceptions and exclusions set forth in Exhibit A of
this report carefully.The exceptions and exclusions are meant to provide you with notice of matters which are not
covered under the terms of the title insurance policy and should be carefully considered.
It is important to note that this preliminary report is not a written representation as to the condition of title and
may not list all liens,defects,and encumbrances affecting title to the land.
Please be advised that any provision contained in this document,or in a document that is attached,linked or
referenced in this document,that under applicable law illegally discriminates against a class of individuals based
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 2
upon personal characteristics such as race,color,religion,sex,sexual orientation,gender identity,familial status,
disability, national origin,or any other legally protected class,is illegal and unenforceable by law.
This report(and any supplements or amendments hereto)is issued solely for the purpose of facilitating the issuance of a policy of
title insurance and no liability is assumed hereby. If it is desired that liability be assumed prior to the issuance of a policy of title
insurance,a Binder or Commitment should be requested.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 3
Dated as of April 16, 2026 at 7:30 A.M.
The form of Policy of title insurance contemplated by this report is:
ALTA Extended Loan Policy of Title Ins (7-1-21)(1)-CA
To Be Determined
A specific request should be made if another form or additional coverage is desired.
Title to said estate or interest at the date hereof is vested in:
THE HOUSING AUTHORITY OF THE CITY OF SANTA ANA, A PUBLIC BODY, CORPORATE AND POLITIC
The estate or interest in the land hereinafter described or referred to covered by this Report is:
Fee
The Land referred to herein is described as follows:
(See attached Legal Description)
At the date hereof exceptions to coverage in addition to the printed Exceptions and Exclusions in said
policy form would be as follows:
1. General and special taxes and assessments for the fiscal year 2026-2027, a lien not yet due or
payable.
2. Intentionally Deleted
3. General and special taxes and assessments for the fiscal year 2025-2026 are exempt.
(Affects Parcels 1, 2 and 3)
4. The lien of supplemental taxes, if any, assessed pursuant to Chapter 3.5 commencing with Section 75
of the California Revenue and Taxation Code.
5. The terms and provisions contained in the document entitled "Agreement" recorded July 11, 1991
as Instrument No. 91-357846 of Official Records.
(Affects Parcel 2)
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 4
6. The condition that the property shall be used for the sole purpose of providing, constructing and
maintaining Affordable Housing, as more fully defined therein, and upon the terms, covenants and
conditions in that certain document recorded January 14, 2022 as Instrument No. 2022000020116 of
Official Records.
Note: A written consent or waiver may be necessary from the public agency for any sale
or refinance.
A document recorded April 24, 2023 as Instrument No. 2023000092686 of Official Records
provides that the above document was subordinated to the document recorded January 4,
2023 as Instrument No. 2023000001784 of Official Records.
7. The condition that the property shall be used for the sole purpose of providing, constructing and
maintaining Affordable Housing, as more fully defined therein, and upon the terms, covenants and
conditions in that certain document recorded January 14, 2022 as Instrument No. 2022000020117 of
Official Records.
Note: A written consent or waiver may be necessary from the public agency for any sale
or refinance.
A document recorded April 24, 2023 as Instrument No. 2023000092686 of Official Records
provides that the above document was subordinated to the document recorded January 4,
2023 as Instrument No. 2023000001784 of Official Records.
8. A deed of trust to secure an original indebtedness of$1,656,947.00 recorded JANUARY 14, 2022 as
INSTRUMENT NO. 2022000020118 OF OFFICIAL RECORDS.
Dated: DECEMBER 7, 2021
Trustor: SHELTER PROVIDERS OF ORANGE COUNTY, INC., DBA
HOMEAID ORANGE COUNTY
Trustee: COMMONWEALTH LAND TITLE COMPANY, A CALIFORNIA
CORPORATION
Beneficiary: THE HOUSING AUTHORITY OF THE CITY OF SANTA ANA
(CA093), ACTING AS THE HOUSING SUCCESSOR AGENCY,
A PUBLIC BODY, CORPORATE AND POLITIC
A document recorded April 24, 2023 as Instrument No. 2023000092684 of Official Records
provides that the lien or charge of the deed of trust was subordinated to the lien or charge of the
deed of trust recorded April 24, 2023 as Instrument No. 2023000092682 of Official Records.
9. The condition that the property shall be used for the sole purpose of providing, constructing and
maintaining Affordable Housing, as more fully defined therein, and upon the terms, covenants and
conditions in that certain document recorded January 14, 2022 as Instrument No. 2022000020119 of
Official Records.
Note: A written consent or waiver may be necessary from the public agency for any sale
or refinance.
10. The terms and provisions contained in the document entitled "Development Impact Fee Deferral
Agreement" recorded January 14, 2022 as Instrument No. 2022000020120 of Official Records.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 5
11. An unrecorded lease dated DECEMBER 30, 2022, executed by THE HOUSING AUTHORITY OF THE
CITY OF SANTA ANA, A PUBLIC BODY, CORPORATE AND POLITIC as lessor and SHELTER
PROVIDERS OF ORANGE COUNTY, INC., DBA HOMEAID ORANGE COUNTY as lessee, as disclosed by
a MEMORANDUM OF LEASE recorded JANUARY 04, 2023 as INSTRUMENT NO. 2023000001781 of
Official Records.
Defects, liens, encumbrances or other matters affecting the leasehold estate, whether or not shown
by the public records.
12. The terms and provisions contained in the document entitled "Lease Rider Agreement CalHFA
Development No. 19-049-M" recorded January 04, 2023 as Instrument No. 2023000001782 of Official
Records.
13. The terms and provisions contained in the document entitled "California Housing Finance Agency
SNHP Regulatory Agreement CalHFA Development No. 19-049-M" recorded January 04, 2023
as Instrument No. 2023000001783 of Official Records.
14. A deed of trust to secure an original indebtedness of$1,259,848.00 recorded JANUARY 04, 2023 as
INSTRUMENT NO. 2023000001784 OF OFFICIAL RECORDS.
Dated: DECEMBER 01, 2022
Trustor: SHELTER PROVIDERS OF ORANGE COUNTY, INC., DBA
HOMEAID ORANGE COUNTY, INC., A CALIFORNIA
NONPROFIT PUBLIC BENEFIT CORPORATION
Trustee: FIRST AMERICAN TITLE COMPANY
Beneficiary: THE CALIFORNIA HOUSING FINANCE AGENCY, A PUBLIC
INSTRUMENTALITY AND POLITICAL SUBDIVISION OF THE
STATE OF CALIFORNIA
A document recorded April 24, 2023 as Instrument No. 2023000092685 of Official Records
provides that the lien or charge of the deed of trust was subordinated to the lien or charge of the
deed of trust recorded April 24, 2023 as Instrument No. 2023000092682 of Official Records.
15. The terms and provisions contained in the document entitled Lot Merger No. 2022-01 recorded April
18,2023 as Instrument No. 2023000088045 of Official Records.
16. A deed of trust to secure an original indebtedness of$1,194,375.00 recorded April 24, 2023 as
2023000092682 OF OFFICIAL RECORDS.
Dated: April 17, 2023
Trustor: Shelter Providers of Orange County, Inc. DBA HomeAid
Orange County, a California Non-Profit Corporation
Trustee: Pacific Western Bank
Beneficiary: Pacific Western Bank
17. A document entitled Assignment of Leases and Rents recorded April 24, 2023 as Instrument No.
2023000092683 of Official Records, as additional security for the payment of the indebtedness
secured by the deed of trust recorded April 24, 2023 as Instrument No. 2023000092682 of Official
Records.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 6
18. A Deed of Trust to secure an original indebtedness of$832,051.28 recorded November 9,
2023 as Instrument No. 2023000275032 of Official Records.
Dated: November 9, 2023
Trustor: Shelter Providers of Orange County, Inc., a California Non-Profit
Corporation D/B/A HomeAid Orange County
Trustee: First American Title Company
Beneficiary: Orange County Housing Finance Trust, a California public agency
formed pursuant to California Government Code section 6500 et.
seq.
A document entitled "Assignment of Lessor's Interest in Leases, Rents and Profits" recorded
November 9, 2023 as Instrument No. 2023000275034 of Official Records, as additional security for
the payment of the indebtedness secured by the deed of trust recorded November 9, 2023 as
Instrument No. 2023000275032 of Official Records.
19. The terms and provisions contained in the document entitled "Regulatory Agreement and Declaration
of Restrictive Covenants" recorded November 9, 2023 as Instrument No. 2023000275033 of Official
Records.
20. A financing statement recorded November 9, 2023 as Instrument No. 2023000275035 of Official
Records.
Debtor: Shelter Providers of Orange County, Inc.
Secured party: Orange County Housing Finance Trust
21. Water rights, claims or title to water, whether or not shown by the Public Records.
22. Rights of parties in possession.
23. The following matters disclosed by an ALTA/NSPS survey made by DS Commercial Due Diligence
Services on October 14, 2021, designated Job No. 21-09-0661:
a. A Wood Fence within the Northerly boundary of the property.
b. An Iron Fence within the Northerly boundary of the property.
c. Chain Link Fences within the Easterly, Westerly, and Southerly boundaries of the property.
d. Gates within the Southerly and Westerly boundaries of the property.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 7
INFORMATIONAL NOTES
Note: The policy to be issued may contain an arbitration clause. When the Amount of Insurance is less
than the certain dollar amount set forth in any applicable arbitration clause, all arbitrable matters shall be
arbitrated at the option of either the Company or the Insured as the exclusive remedy of the parties. If
you desire to review the terms of the policy, including any arbitration clause that may be included,
contact the office that issued this Commitment or Report to obtain a sample of the policy jacket for the
policy that is to be issued in connection with your transaction.
1. General and special taxes and assessments for the fiscal year 2025-2026.
First Installment: $192.00, PAID
Penalty: $0.00
Second Installment: $192.00, PAID
Penalty: $0.00
Tax Rate Area: 11-003
A. P. No.: 398-303-07
(Affects Parcel 4)
2. The property covered by this report is vacant land.
3. According to the public records, there has been no conveyance of the land within a period of twenty-
four months prior to the date of this report, except as follows:
None
4. We are informed that a work of improvement is contemplated on the land referred to in this
report/commitment. The land will be inspected on the day documents are intended to be recorded
for the purpose of determining whether the commencement of work has occurred. (Commencement
of the work includes but is not limited to grading, staking and delivery of equipment or materials.)
Should commencement of work occur prior to the close of escrow and recordation of documents, the
Company will require various documents and information, including but not limited to a completed
mechanics' lien risk analysis, construction contract(s), lien waivers, loan agreement, disbursement
information, executed indemnity agreement and current financial information from proposed
indemnitors, in order to determine whether mechanics' lien insurance can be issued. Other
requirements may be made following the review of such documents and information.
The map attached, if any, may or may not be a survey of the land depicted hereon. First American
expressly disclaims any liability for loss or damage which may result from reliance on this map except to
the extent coverage for such loss or damage is expressly provided by the terms and provisions of the title
insurance policy, if any, to which this map is attached.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 8
LEGAL DESCRIPTION
Real property in the City of Santa Ana, County of Orange, State of California, described as follows:
PARCEL 1: (APN: 398-303-04)
THE SOUTHWESTERLY 50.00 FEET OF LOTS 13, 14, 15 AND 16 IN BLOCK 66 OF SANTA ANA EAST, AS
SHOWN ON A MAP RECORDED IN BOOK 10, PAGES 43 AND 44 OF MISCELLANEOUS RECORDS OF LOS
ANGELES COUNTY, CALIFORNIA.
PARCEL 2: (APN: 398-303-05)
THE NORTHEASTERLY 50.00 FEET OF THE SOUTHWESTERLY 100.00 FEET OF LOTS 13, 14, 15 AND 16
IN BLOCK 66 OF SANTA ANA EAST, AS SHOWN ON A MAP RECORDED IN BOOK 10, PAGES 43 AND 44
OF MISCELLANEOUS RECORDS OF LOS ANGELES COUNTY, CALIFORNIA.
PARCEL 3: (APN: 398-303-06)
THE EASTERLY 47 FEET OF THE SOUTHERLY 15 FEET OF LOT 14 AND THE EASTERLY 47 FEET OF LOTS
15 AND 16, ALL IN BLOCK 66 OF "SANTA ANA EAST", CITY OF SANTA ANA, COUNTY OF ORANGE,
STATE OF CALIFORNIA, AS PER MAP THEREOF RECORDED IN BOOK 10 PAGES 43 AND 44 OF
MISCELLANEOUS MAPS RECORDS OF LOS ANGELES, CALIFORNIA.
PARCEL 4: (APN: 398-303-07)
THE EASTERLY 50 FEET OF LOT 13, THE NORTHERLY 10 FEET OF THE EASTERLY 50 FEET OF LOT 14,
THE WESTERLY 3 FEET OF THE EASTERLY 50 FEET OF THE SOUTHERLY 15 FEET OF LOT 14, AND THE
WESTERLY 3 FEET OF THE EASTERLY 50 FEET OF LOTS 15 AND 16 IN BLOCK 66 OF SANTA ANA EAST,
IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN
BOOK 10, PAGES 43 AND 44 OF MISCELLANEOUS MAPS, OF LOS ANGELES COUNTY.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 9
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Not American Tittle
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 10
NOTICE
Section 12413.1 of the California Insurance Code, effective January 1, 1990, requires that any title insurance
company, underwritten title company, or controlled escrow company handling funds in an escrow or sub-
escrow capacity, wait a specified number of days after depositing funds, before recording any documents in
connection with the transaction or disbursing funds. This statute allows for funds deposited by wire transfer
to be disbursed the same day as deposit. In the case of cashier's checks or certified checks, funds may be
disbursed the next day after deposit. In order to avoid unnecessary delays of three to seven days, or more,
please use wire transfer, cashier's checks, or certified checks whenever possible.
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 11
EXHIBIT A
LIST OF PRINTED EXCEPTIONS AND EXCLUSIONS(BY POLICY TYPE)
CLTA/ALTA HOMEOWNER'S POLICY OF TITLE INSURANCE[(07-01-2021)v.01.00]
EXCLUSIONS FROM COVERAGE
The following matters are excluded from the coverage of this policy and We will not pay loss or damage,costs,attorneys'fees,or expenses
that arise by reason of:
1. a. any law,ordinance,permit,or governmental regulation (including those relating to building and zoning)that restricts,regulates,
prohibits,or relates to:
i. the occupancy, use,or enjoyment of the Land;
ii. the character,dimensions,or location of any improvement on the Land;
iii. the subdivision of land;or
iv. environmental remediation or protection.
b. any governmental forfeiture,police,or regulatory,or national security power.
c. the effect of a violation or enforcement of any matter excluded under Exclusion i.a. or 1.b.
Exclusion 1 does not modify or limit the coverage provided under Covered Risk 8.a., 14, 15, 16, 18, 19,20,23,or 27.
2. Any power to take the Land by condemnation. Exclusion 2 does not modify or limit the coverage provided under Covered Risk 17.
3. Any defect,lien,encumbrance,adverse claim,or other matter:
a. created,suffered,assumed,or agreed to by You;
b. not Known to Us,not recorded in the Public Records at the Date of Policy, but Known to You and not disclosed in writing to Us by
You prior to the date You became an Insured under this policy;
C. resulting in no loss or damage to You;
d. attaching or created subsequent to the Date of Policy(Exclusion 3.d.does not modify or limit the coverage provided under Covered
Risk 5,8.f.,25,26,27,28,or 32);or
e. resulting in loss or damage that would not have been sustained if You paid consideration sufficient to qualify You as a bona fide
purchaser of the Title at the Date of Policy.
4. Lack of a right:
a. to any land outside the area specifically described and referred to in Item 3 of Schedule A;and
b. in any street,road,avenue,alley,lane, right-of-way, body of water,or waterway that abut the Land.
Exclusion 4 does not modify or limit the coverage provided under Covered Risk 11 or 21.
5. The failure of Your existing structures,or any portion of Your existing structures,to have been constructed before,on,or after the Date
of Policy in accordance with applicable building codes. Exclusion 5 does not modify or limit the coverage provided under Covered Risk 14
or 15.
6. Any claim, by reason of the operation of federal bankruptcy,state insolvency,or similar creditors'rights law,that the transfer of the Title
to You is a:
a. fraudulent conveyance or fraudulent transfer;
b. voidable transfer under the Uniform Voidable Transactions Act;or
C. preferential transfer:
i. to the extent the instrument of transfer vesting the Title as shown in Schedule A is not a transfer made as a contemporaneous
exchange for new value; or
ii. for any other reason not stated in Covered Risk 30.
7. Contamination,explosion,fire,flooding,vibration,fracturing,earthquake,or subsidence.
8. Negligence by a person or an entity exercising a right to extract or develop oil,gas,minerals,groundwater,or any other subsurface
substance.
9. Any lien on Your Title for real estate taxes or assessments imposed or collected by a governmental authority that becomes due and
payable after the Date of Policy. Exclusion 9 does not modify or limit the coverage provided under Covered Risk 8.a.or 27.
10. Any discrepancy in the quantity of the area,square footage,or acreage of the Land or of any improvement to the Land.
LIMITATIONS ON COVERED RISKS
Your insurance for the following Covered Risks is limited on the Owner's Coverage Statement as follows:
For Covered Risk 16, 18, 19,and 21 Your Deductible Amount and Our Maximum Dollar Limit of Liability shown in Schedule A.
The deductible amounts and maximum dollar limits shown on Schedule A are as follows:
Your Deductible Amount Our Maximum Dollar Limit of Liability
Covered Risk 16: 1%of Policy Amount Shown in Schedule A or$2,500 $10,000
(whichever is less)
Covered Risk 18: 1%of Policy Amount Shown in Schedule A or$5,000 $25,000
(whichever is less)
Covered Risk 19: 1%of Policy Amount Shown on Schedule A or$5,000 $25,000
(whichever is less)
Covered Risk 21: 1%of Policy Amount Shown on Schedule A or$2,500 $5,000
(whichever is less)
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 12
ALTA OWNER'S POLICY[(07-01-2021)V.01.001
CLTA STANDARD COVERAGE OWNER'S POLICY[(02-04-22)V.01.00]
EXCLUSIONS FROM COVERAGE
The following matters are excluded from the coverage of this policy,and the Company will not pay loss or damage,costs,attorneys'fees,or
expenses that arise by reason of:
1. a. any law,ordinance,permit,or governmental regulation (including those relating to building and zoning)that restricts,regulates,
prohibits,or relates to:
i. the occupancy, use,or enjoyment of the Land;
ii. the character,dimensions,or location of any improvement on the Land;
iii. the subdivision of land;or
iv. environmental remediation or protection.
b. any governmental forfeiture,police,regulatory,or national security power.
c. the effect of a violation or enforcement of any matter excluded under Exclusion i.a. or 1.b.
Exclusion 1 does not modify or limit the coverage provided under Covered Risk 5 or 6.
2. Any power of eminent domain. Exclusion 2 does not modify or limit the coverage provided under Covered Risk 7.
3. Any defect,lien,encumbrance,adverse claim,or other matter:
a. created,suffered,assumed,or agreed to by the Insured Claimant;
b. not Known to the Company,not recorded in the Public Records at the Date of Policy, but Known to the Insured Claimant and not
disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this
policy;
C. resulting in no loss or damage to the Insured Claimant;
d. attaching or created subsequent to the Date of Policy(Exclusion 3.d. does not modify or limit the coverage provided under Covered
Risk 9 or 10);or
e. resulting in loss or damage that would not have been sustained if consideration sufficient to qualify the Insured named in Schedule
A as a bona fide purchaser had been given for the Title at the Date of Policy.
4. Any claim, by reason of the operation of federal bankruptcy,state insolvency,or similar creditors'rights law,that the transaction vesting
the Title as shown in Schedule A is a:
a. fraudulent conveyance or fraudulent transfer;
b. voidable transfer under the Uniform Voidable Transactions Act;or
C. preferential transfer:
i. to the extent the instrument of transfer vesting the Title as shown in Schedule A is not a transfer made as a contemporaneous
exchange for new value; or
ii. for any other reason not stated in Covered Risk 9.b.
5. Any claim of a PACA-PSA Trust. Exclusion 5 does not modify or limit the coverage provided under Covered Risk 8.
6. Any lien on the Title for real estate taxes or assessments imposed or collected by a governmental authority that becomes due and
payable after the Date of Policy. Exclusion 6 does not modify or limit the coverage provided under Covered Risk 2.b.
7. Any discrepancy in the quantity of the area,square footage,or acreage of the Land or of any improvement to the Land.
NOTE:The 2021 ALTA Owner's Policy may be issued to afford either Standard Coverage or Extended Coverage. In addition to variable
exceptions such as taxes,easements,CC&R's,etc.,the Exceptions from Coverage in a Standard Coverage policy will also include the Western
Regional Standard Coverage Exceptions listed below as numbers 1 through 7. The 2021 CLTA Standard Coverage Owner's Policy will include
the Western Regional Standard Coverage Exceptions listed below as numbers 1 through 7.
EXCEPTIONS FROM COVERAGE
Some historical land records contain Discriminatory Covenants that are illegal and unenforceable by law.This policy treats any Discriminatory
Covenant in a document referenced in Schedule B as if each Discriminatory Covenant is redacted, repudiated,removed,and not republished
or recirculated. Only the remaining provisions of the document are excepted from coverage.
This policy does not insure against loss or damage and the Company will not pay costs,attorneys'fees,or expenses resulting from the terms
and conditions of any lease or easement identified in Schedule A.and the following matters:
1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on
real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments,or notices of such
proceedings,whether or not shown by the records of such agency or by the Public Records.
2. Any facts,rights,interests,or claims that are not shown by the Public Records but that could be ascertained by an inspection of the Land
or that may be asserted by persons in possession of the Land.
3. Easements,liens or encumbrances,or claims thereof, not shown by the Public Records.
4. Any encroachment,encumbrance,violation,variation,or adverse circumstance affecting the Title that would be disclosed by an accurate
and complete land survey of the Land and not shown by the Public Records.
5. (a)Unpatented mining claims; (b) reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c)water rights,
claims or title to water,whether or not the matters excepted under(a),(b),or(c)are shown by the Public Records.
6. Any lien or right to a lien for services,labor or material unless such lien is shown by the Public Records at Date of Policy.
7. Any claim to(a)ownership of or rights to minerals and similar substances, including but not limited to ores,metals,coal, lignite,oil,gas,
First American Title
EXHIBIT 3
Order Number: 5850714-A (tc)
Page Number: 13
uranium, clay, rock,sand,and gravel located in,on,or under the Land or produced from the Land,whether such ownership or rights
arise by lease,grant,exception,conveyance, reservation,or otherwise;and (b)any rights, privileges, immunities,rights of way,and
easements associated therewith or appurtenant thereto,whether or not the interests or rights excepted in(a)or(b)appear in the Public
Records or are shown in Schedule B.
2006 ALTA OWNER'S POLICY(06-17-06)
EXCLUSIONS FROM COVERAGE
The following matters are expressly excluded from the coverage of this policy,and the Company will not pay loss or damage,costs,attorneys'
fees,or expenses that arise by reason of:
1. (a) Any law,ordinance,permit,or governmental regulation(including those relating to building and zoning) restricting,regulating,
prohibiting,or relating to
(i) the occupancy, use,or enjoyment of the Land;
(ii) the character,dimensions,or location of any improvement erected on the Land;
(iii) the subdivision of land;or
(iv) environmental protection;
or the effect of any violation of these laws,ordinances,or governmental regulations. This Exclusion 1(a)does not modify or limit the
coverage provided under Covered Risk 5.
(b) Any governmental police power. This Exclusion 1(b)does not modify or limit the coverage provided under Covered Risk 6.
2. Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8.
3. Defects,liens,encumbrances,adverse claims,or other matters
(a) created,suffered,assumed,or agreed to by the Insured Claimant;
(b) not Known to the Company,not recorded in the Public Records at Date of Policy,but Known to the Insured Claimant and not
disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this
policy;
(c) resulting in no loss or damage to the Insured Claimant;
(d) attaching or created subsequent to Date of Policy(however,this does not modify or limit the coverage provided under Covered Risk
9 and 10);or
(e) resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title.
4. Any claim, by reason of the operation of federal bankruptcy,state insolvency,or similar creditors'rights laws,that the transaction
vesting the Title as shown in Schedule A,is
(a) a fraudulent conveyance or fraudulent transfer; or
(b) a preferential transfer for any reason not stated in Covered Risk 9 of this policy.
5. Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of
Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A.
NOTE:The 2006 ALTA Owner's Policy may be issued to afford either Standard Coverage or Extended Coverage. In addition to variable
exceptions such as taxes,easements,CC&R's,etc.,the Exceptions from Coverage in a Standard Coverage policy will also include the Western
Regional Standard Coverage Exceptions listed below as numbers 1 through 7.
EXCEPTIONS FROM COVERAGE
This policy does not insure against loss or damage,and the Company will not pay costs,attorneys'fees or expenses,that arise by reason of:
The above policy form may be issued to afford either Standard Coverage or Extended Coverage. In addition to the above Exclusions from
Coverage,the Exceptions from Coverage in a Standard Coverage policy will also include the following Exceptions from Coverage:
1. (a) Taxes or assessments that are not shown as existing liens by the records of any taxing authority that levies taxes or assessments on
real property or by the Public Records; (b) proceedings by a public agency that may result in taxes or assessments,or notices of such
proceedings,whether or not shown by the records of such agency or by the Public Records.
2. Any facts, rights,interests,or claims that are not shown in the Public Records but that could be ascertained by an inspection of the Land
or that may be asserted by persons in possession of the Land.
3. Easements,liens or encumbrances,or claims thereof, not shown by the Public Records.
4. Any encroachment,encumbrance,violation,variation,or adverse circumstance affecting the Tide that would be disclosed by an accurate
and complete land survey of the Land and that are not shown by the Public Records.
5. (a) Unpatented mining claims; (b)reservations or exceptions in patents or in Acts authorizing the issuance thereof; (c)water rights,
claims or title to water,whether or not the matters excepted under(a),(b),or(c)are shown by the Public Records.
6. Any lien or right to a lien for services,labor or material unless such lien is shown by the Public Records at Date of Policy.
7. Any claim to(a)ownership of or rights to minerals and similar substances, including but not limited to ores,metals,coal, lignite,oil,gas,
uranium,clay,rock,sand,and gravel located in,on,or under the Land or produced from the Land,whether such ownership or rights
arise by lease,grant,exception,conveyance, reservation,or otherwise;and (b)any rights, privileges,immunities,rights of way,and
easements associated therewith or appurtenant thereto,whether or not the interests or rights excepted in(a)or(b)appear in the Public
Records or are shown in Schedule B.
APN:
First American Title